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Chain reaction


A combination of new hotel brands and consolidation continues to impact choices for travel buyers


By DAVID CHURCHILL  


 was the largest hotel group in the world in terms of room numbers, just ahead of Hilton but significantly further


in front than third-placed Marriott Inter- national. Yet two years on, it is Marriott that now leads the pack after its US$13.3bn acquisition of Starwood Group late last year to create a global hospitality giant comprising 30 hotel brands and more than 1.2 million rooms. IHG, with some 767,000 rooms and just a dozen brands, has also slipped to third place in the rankings, albeit only marginally behind Hilton. But IHG, whose global headquarters are located in Denham, south Buckingham- shire, seems determined to fight back in a bid to regain its former dominance. Over the summer, at the annual meeting of its hotel owners and franchisees in Las


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Vegas, it revealed plans to launch a new brand aimed firmly at the lower end of the midscale market, in which IHG is already a key player with its Holiday Inn and Holiday Inn Express brands. Rooms in the new brand will be priced some US$10-15 below the rack rate of a comparable HI Express hotel, IHG revealed.


Richard Solomons, who retired in August, age 55, after six years as IHG’s chief execu- tive and 25 years with the group, made an interesting comment before he left. He told financial analysts that “while it was easy to add brands from a supply perspective, from a guest perspective if the brand isn’t meaningful and relevantly differentiated then what we are doing is confusing them.” As BBT goes to press, IHG has not yet


announced the new brand’s name, refer- ring to it only as ‘Project Horizon’. Initial construction is planned to start early next year, for openings beginning in 2019.


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Whatever the new brand’s name, it will be entering a crowded market that can create headaches for the managed travel sector. The number of global hotel brands has now reached just under 1,000, according to latest figures compiled by hotel data company STR, which has identified some 996 brands. This includes 196 in the upper midscale segment (where both the existing Holiday Inn brands are positioned), and 154 more classed as midscale, where the new IHG brand will be positioned. Many of these 996 brands, however, are small regional or local groups being devel- oped to create an identity for hotel owners with a clutch of properties to market. Even President Trump is getting into the game with plans for two new brands to add to his company’s existing golf and resort hotels: the ‘lifestyle’ brand called Scion and a three- star concept named American Idea. This will


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