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Peter Gowers joined the strategic planning group of Bass PLC, a hotels, brewing, bars and restaurants conglomerate in 1999. When Bass (then known as Six Continents) announced the de-merger of its remaining businesses in 2002, Peter joined the newly independent hotels company, InterContinental Hotels Group, as Executive Vice President (EVP) of Strategy. In 2003, Peter was appointed EVP Global Brand Services with responsibility for group strategy, worldwide marketing and distribution, loyalty programs and revenue management.
This interview features a discussion between Frank van den Driest of EffectiveBrands and Peter Gowers of InterContinental Hotels Group. It talks about the challenges of global brand development, global activation in a franchise service model, and inspiring brand-building behaviors throughout an organization.
"We are much better off optimizing our brand for local market conditions than trying to impose a 'one size fits all' approach across the world" |
InterContinental Hotels Group is comprised of seven major hotel chains across the world. What challenges do you face in managing those chains? Are there any industry-specific challenges that were particularly difficult?
Gowers: I think the biggest challenge for us is global brand development. We really wrestled with the challenge of deciding which brands to run globally and which ones are national. As part of our organizational review, we decided that we would run our InterContinental brand as a global brand, meaning one team based in one location with contacts with stakeholders in three regions. They run it as one consistent product across the world.
Holiday Inn (the world's most stayed-at brand) is run on a regional basis. For Holiday Inn we have dedicated teams in each of our big markets. Each Holiday Inn looks and feels a bit different depending on where you are in the world.
We operate in a franchise service model. We not only have the challenge of what you would like the brand to look like in different regions, but we also have the added challenge of actually making it happen. We don't control the consumer experience to the last degree. Most branded hotels in the world are franchised. The owner of the property is not the same as the brand owner.
The approach to this challenge has always been to anchor it back to what the consumer wants. What do we think matters to our consumers? We found that 70% of the people who are staying in a hotel tonight are staying in the country they live in. Knowing that, we are much better off optimizing our brand for local market conditions than trying to impose a 'one size fits all' approach across the world.
How do you run the InterContinental brand? How the team is set up and structured in terms of roles and responsibilities?
Gowers: We have a Senior VP of the InterContinental brand and she is based in our corporate office in the UK with me. She has all the classic brand management responsibilities: developing the brand essence, the core brand positioning, the essential attributes for the brand, the hotel standards, and assuring a consistent, creative look and feel. She also does the media buying and selection for most markets of the world.
In the biggest region in which we operate (U.S.), we have folks on the ground that deal with modifying the global campaign locally and also serve as the public face of the brand if we try to buy or sell a new hotel. Those people report in a matrix structure into the global brand manager and also to a local or regional marketing director.
We have a brand team here in the centre that is responsible for A&P and new product development. In total, the team is about six people.
With respect to developing the InterContinental brand positioning based on a universal target consumer insight, how did you tackle this?
Gowers: First of all, on the consumer side, the InterContinental brand targets the consumer who is internationally-minded, psychographically as well as demographically (who see themselves as or actually are people who travel all over the world). We have a lot of consumers in America who don't travel the world at all, but like to feel they understand its differences. The brand is aimed at that kind of consumer.
When we revisited our brand positioning, we commissioned quantitative research in the US market, Europe and several markets in Asia to get an understanding of our broad consumer base for segmentation purposes. From this research, we distilled the critical and fundamental attributes to deliver the guest experience that really needed to be consistent across all three regions. For the InterContinental brand, these attributes included: having a signature restaurant, providing 24-hour a day services and offering real local insight to help you get the most from your stay.
Then we looked at attributes that were very specific to the local market. For example, a consumer who visits one of the less developed markets in Asia Pacific expects to find many staff to deal with their needs, they know that the labor costs there support this level of service. They don't necessarily expect quite the same thing when they go to Geneva.
So we have a basic series of things that all our hotels do regardless of where they are in the world and we try to select a minimum number. What we are looking to have is a guaranteed execution across the world. In a service business the fewer things you guarantee, the more likely you are to be able to do them. Brands that can guarantee very complicated propositions around the world tend only to be higher-priced brands like the InterContinental.
We might have 25% of standards that are absolutely cast in stone; the remainder (which are largely to do with physical property and staffing levels) will be much more flexible by region. We allow our hotel operators in each region to make those decisions in accordance with local competition.
"You can't come up with a positioning of your brand that is inconsistent with the sort of people you've got working for you." |
How does your vision and culture relate to your brand positioning?
Gowers: We are trying to link the corporate strategy of the business that we communicate to the stock market as explicitly as possible with our day-to-day operations. This company is all about signing up new contracts and franchises and the key driver of doing that is brand strength. Gradually over time, we built more and more of a brand culture in our company where it used to be dominated by a hotel operations culture. These are two very different things. We are wrestling with the challenge: what takes the values of your brand right through the organization when your organization is full of people who are not used to seeing brands in the hotel industry.
How do you ensure that this brand positioning is executed in terms of the values that people represent to the end consumer?
Gowers: There are two big things that we have learned that have influenced the way we do things:
You can't come up with a positioning of your brand that is inconsistent with the sort of people you've got working for you, unless you are prepared to change them all and that is pretty difficult. We very much start from the perspective that if you want this value to come alive on the property, you have to have the right kind of people in the first place. So, I can't tweak my brand values unless I am committed to changing my staff.
The second thing we learned is that every aspect of your marketing and service delivery has to be tied back to the brand essence & personality. I know this is Marketing 101, but in this industry it's something quite difficult to do. Our brand personality, 'the hotel that understands you', wouldn't mean anything if we couldn't get those little executions right. We tend to try and do fewer things, but do them really well. A good example of that would be our Holiday Inn Express brand. We selected one or two things that we can stand for and completely execute. A new breakfast concept, an initiative of the brand director, was successfully rolled out over 1,000 hotels in about 3 months. This concept was thoroughly researched and works on one of the key attributes of Holiday Inn Express.
Once you've got that employee base you can't change it completely, but you can influence the new people that you take on board. How do the brand values influence your recruitment process?
Gowers: At a property level it is fairly obvious that recruiting on brand type does. You tend to screen against a particular pattern of brand attributes. For example, at Holiday Inn we tend to recruit people who are extrovert and have a friendly demeanor and all the other things that go with our brand. At InterContinental we try to recruit people that know how to deliver discreet service. We even tried to extend this back up the line: if you look at the 5 or 6 people that head up the brand in the different markets, you will find that they tend to embody their brand personality. So the person who runs Staybridge Suites is very much a straight-forward, unpretentious kind of guy and the lady who runs InterContinental is someone who obviously knows her way around the luxury end of the travel market.
We have got people whose personalities reflect the brand that they run and that turns out to be very effective. When you are trying to sell a new hotel (or get a travel agent to decide to book people into your property) there is nothing that makes them feel more comfortable about it than seeing the personality of the brand come through in the people who are going to deliver it.
Could you elaborate on the brand values that are important for InterContinental in recruitment?
Gowers: InterContinental tends to look for people who are respectful but not sycophantic, have a degree of appreciation for the world, rather than just their local market. InterContinental, for example, has a far higher proportion of people who have worked in multiple countries, right down to housekeepers and front desk staff. We do tend to recruit people who know the foibles of different nationalities and that is much more important than at a Holiday Inn Express. A good InterContinental General Manager will probably have worked in at least three countries and three continents. For most of our people this is quite true, they have worked in multiple geographic regions of the world. Ultimately, the brand personality is very much to be both worldly and international and relatively exclusive and sophisticated.
Does this carry through in the way you evaluate people in their performance reviews?
Gowers: We're getting there. On the spectrum of things you can do to guarantee the guest's experience, you first start with a clear brand identity. You translate that into who you hire and you then monitor that into how they deliver. I would say we have done a good job on the first two. We are starting to track individual performance with reference to individual brands. That has been the main challenge, and I guess it's also the case in other industries. Economies of scale in the systems facilitate tracking them all in the same way (standard performance assessment across brands). This can leave little room for brand individuality. In the industry everyone is learning that you can't create a true brand personality unless you do measure the brand performance differently by brand. We are just starting to roll this out.
Principles of Effective Global Brand Leadership
In this discussion, Peter Gowers has emphasized the importance of several principles of leading global brands.
Focus the Global Brand Team
In a service industry, having a focused brand positioning is a key success factor. Knowing this, InterContinental selected set of core brand attributes which then allows the Global Brand Team to focus on, and flawlessly execute, each of those attributes. The brand platform clearly identifies which attributes should be consistent globally and which can be adapted for the local market, giving clarity between the Global Brand Team and local marketers.
Inspire Personal Commitment to the Brand
A challenge several global brand leaders face is inspiring the personal commitment of their employees to their brand. InterContinental recognizes this challenge and reflects it not only in their positioning, but also in their hiring practices. The brand leaders in each of their markets personify the brand. In leading by example, they inspire others in the organization to become more committed to the brand. When hiring all new employees, InterContinental looks for people who embody the brand personality, knowing that they will better be able to deliver on the brand promise.
Promote True Brand Behavior
Promoting the right behavior is a key component to the long-term success of a brand. An essential part of promoting consistent brand behavior is measurement. InterContinental acknowledges the importance of monitoring how employees deliver on the brand promise. While they are still in the process of rolling out a performance measurement system tailored to their individual brands, InterContinental understands the importance of promoting and reinforcing behavior that is consistent with the brand identity.
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