1. Introduction
In the current business world, for companies of all sizes in all types of industries and all types of markets, it has become a priority to well build and manage brand equity. As a matter of fact, companies can obtain customer loyalty and huge profits from strong brand equity, and thus the rewards of maintaining a strong brand are clear (Keller, 2000). Companies can gain huge benefits by establishing strong brand equity and use their global influential brands as vanguards, penetrate into target markets.
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Last century thousands of brand miracles have been seen one after another, like Coca-Cola, McDonald’s, Rolls-Royce, Louis Vuitton, Sony, Apple, Microsoft, and so on. By building strong brand equity, these world top brands get easier and faster move penetrating into new markets and occupying target markets. When it comes to hospitality industry, it is especially true as in this industry revenues and decreased costs brought by customer loyalty and revisiting are more obvious and easier to measure.
Keller in his paper “The brand report card” put forward ten characteristics common to world’s strongest brands which construct an informative and illuminating tool kit to measure if a brand is well managed. It can be used to measure how well a brand as well as its competitor brands grade according to these ten attributes. This article takes InterContinental as example and combines with Keller’s brand report card knowledge to analyze and assess InterContinental’s brand portfolio and its brand strategy.
2. InterContinental and Its Brand Portfolio
InterContinental Hotels Group (IHG) is an international hotel company dedicated to provide extraordinary service and memorable experiences for their customers. With its excellent corporate management and mature brand management, the group stands as one of the leading hotel brands spreading from Europe to all over the world in the hospitality industry.
IHG is the world’s largest hotel operator in respect of number of rooms. It is reported that they have totally over 650,000 guest rooms in more than 4,400 hotels spreading in 100 different countries. In IHG hotels their guest stays records more than 130 million every single year.
IHG operates seven hotel brands – InterContinental, Crowne Plaza, Hotel Indigo, Holiday Inn, Holiday Inn Express, Staybridge Suites and Candlewood Suites. By using multi-brand strategy it can satisfy customers of different preferences. Among the seven hotel brands some become the well-known and most popular brands in the world. The group has built up a brand portfolio which encompasses hotel brands of luxurious upscale located in the world’s major cities and resorts and reliable family and leisure-oriented hotel brands that offer valued service (IHG Official Website of, 2010).
Just as CEO of InterContinental Hotels Group Andrew Cosslett says this year, the hospitality industry has endured a standstill or even worse during the recession, but some chains are climbing back. He says hotel branding is the final way to save the hospitality industry and if they want to stay on top, brand strength is going to be a key part of the rebound (DuBois, 2010).
IHG operates its hotels in three different ways – as a franchisor, a manager and on an owned-and-leased basis. The largest part of their business is franchising, with over 3800 hotels under franchise agreements. 624 hotels worldwide are operated on management contracts with hotel owners. And only 16 hotels (less than 1 per cent of their portfolio) are owned and managed by the company.
This means that IHG’s operating system focuses on building up its brand equity worldwide rather than managing properties. InterContinental has been dedicated to create strong brand power and put tremendous capital and time to strengthen its brand image.
The diversity of InterContinental’s brand portfolio indicates that it can have the flexibility and option to properly respond to various types of hotel development opportunity. What’s more, hotel owners of different countries and regions can choose the most appropriate hotel brand that will give full play to their own characteristics and advantages and thus maximize the potential of a particular site locally. And whether the guests are travelling for business or leisure, for a honeymoon or a family holiday, they’ll have a hotel that’s right for them. InterContinental (IHG) spans seven different nameplates, and each one needs to tailor to a different customer, says by Cosslett, CEO of IHG.
The seven brands of IHG are set to meet different market segments respectively (IHG Official Website of, 2010). InterContinental Hotels & Resorts is the most prestigious and luxurious hotel brand of IHG, located in many major cities and resorts in over 60 countries worldwide which offers extraordinary service and advanced facilities to both business and leisure travellers.
Crowne Plaza is an international premium hotel brand that offers greatly comfortable and elegant accommodation and it is mainly designed for those discerning travellers in business trips or leisure journeys who appreciates and enjoys simplified elegance.
Hotel Indigo is a new innovative brand which is designed for guests of distinguishing style consciousness. It is a stylish boutique hotel attracting travellers who are searching the individual approach and facilities. Indigo hotels are usually located in urban, mid-town and suburban areas and stand close to business venues, big restaurants and some entertainment venues.
Holiday Inn is a civilian hotel brand as well as the most classic hotel brand of IHG which has gained international reputation and offers absolute dependability, friendly and qualified service, modern facilities and good value to today’s business and leisure travellers. Holiday Inn spreads widely and develops smoothly since its brand launching in major cities as well as small towns, usually along quiet roadways and near bustling airports (De Lollis, 2007).
Holiday Inn Express is a fast growing hotel brands in market segments of IHG as a quite fresh and uncomplicated hotel brand. It offers guests great convenience and comfort.
Staybridge Suites is designed for extended-stay guests that its brand name has shown the message. It is an all-suite hotel brand to win targeted customers in business, relocation or leisure preferring a residential-style hotel.
Candlewood Suites is an up-to-middle hotel brand that offers high-quality accommodation and caters to mid-market business and leisure travellers. It provides multiple night hotel stay and is also an extended stay hotel.
Along with the brand portfolio, IHG has the largest reward scheme which is called “Priority Club” in the hotel industry. Priority Club offers its members privileges and rewards within pointed hotel brands of IHG as well as unparalleled levels of free choice through their chain hotels worldwide (IHG Official Website of, 2010).
3. Application of the brand report card to the Intercontinental brand
Since InterContinental has such a diverse brand portfolio, it grasps many more development opportunities and grows fast. In this part the article will assess the InterContinental brand with the tool kit of Keller’s ten attributes that most of the world strongest brands have.
3.1 A brief overview of the ten attributes of Keller’s brand report card.
In the paper “The brand report card”, Keller explains ten points of attributes that shared by many successful brands. They are briefed as follows (Keller, 2000):
The brand maximizes customers’ experiences and surpasses their expectations.
The brand stays relevant to customer imagery and market trends.
The pricing strategy is based on consumers’ perceptions of value.
The brand is properly positioned to keep points of parity and difference.
The brand is conveying consistent brand image and information.
The brand portfolio and hierarchy make sense and cover segmented markets separately.
The brand utilizes marketing activities to build brand equity.
The brand’s managers understand what consumers want from the brand.
The brand is given proper and sustained support over the long run.
The company monitors sources of brand equity and audits the brand.
3.2 Application of the brand report card to the Intercontinental brand
Brands take on unique, personal meanings to consumers that facilitate their day-to-day activities and enrich their lives (Keller, 2006). So when companies build their brand equity, unique and personal associations and other intangible factors are required to melt into the brand building and maintaining process. With the ten points mentioned above, this part gives a general assessment of InterContinental’s brand portfolio.
Combined with Keller’s brand report card, Figure 1 illustrates how the InterContinental brand portfolio has behaved.
Figure 1 Application of the brand report card to the Intercontinental brand
Brand
Attribute
InterContinental
Crowne Plaza
Hotel Indigo
Holiday Inn
Holiday Inn Express
Staybridge Suites
Candlewood Suites
a
Excels customers’ true desire
Excels customers’ true desire
It depends
Meets customers’ true desire
Fair meets customers’ true desire
Excels customers’ true desire
Meets customers’ true desire
b
Yes, as luxury is forever theme
Yes, satisfies upper rank
Yes, caters for stylish and innovative
No, rebranding under plan
Yes, convenience and quick
Yes, relevant
Yes, relevant
c
Luxurious experience, high priced
Expensive and elegant
Uniqueness and fair price
Comfortable and fair price
Convenience with average price
Value priced
Civilian priced
d
Clear
Proper
Clear
Proper
Fair
Clear
Unclear
e
Consistent
Consistent
Consistent
Fair consistent
Consistent
Consistent
Consistent
f
Make sense, targeted at the riches
Make sense, targeted at high income
Make sense, targeted at men of characters
Targeted at upper and mid-market
Make sense, targeted at simple and busy men
Make sense, targeted at extended-stay
Make sense, targeted at mid-market
g
Greatly involved
Highly involved
Highly involved
Greatly involved
Highly involved
Involved
Involved
h
Doing well, esp. in Eu & US
Doing well
Doing well in Eu & US
Doing well before, need renew now
Doing well, in Eu & US
Doing well in Eu & US
Doing well in Eu & US
i
Great support as corporate core business
Stable support as profitable business
Special support
Great support, spend huge to rebrand.
Continuing support
Stable support
Less support
j
Efficient brand audit
Efficient brand audit
depends
Inefficient brand audit
Efficient brand audit
Sometimes
Not often(PS: The horizon list is the InterContinental brand portfolio and the vertical list represents the ten dimensions explained above respectively simplified by a, b, c,…, j.)
In hospitality industry, customers put much emphasis on their experiences. How an individual perceives the value of their experiences is dependent upon a series of sociological and psychological processes (Beaton, et al, 2009). In Keller’s brand report card, the ten attributes concerns a lot about building brand strategy following the change of sociological and psychological factors such as market trends, perceived value of customers and brand improvement. According to previous achievements, IHG behaves quite successful in building brand equity worldwide. And the seven brands have their strong points and can be complementary with each other.
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Each brand in the InterContinental portfolio is designed to satisfy a segmented target market in terms of service and price. According to Keller, brands at each level of the hierarchy of portfolio accumulate power to the overall equity of the portfolio through their individual influence to make consumers aware of the various products and foster favourable associations with them. Each brand should have its own boundaries that not to cover too much ground with one brand or to overlap two brands in the same portfolio (Keller, 2000). InterContinental has seven brands that are targeted on diverse segmented markets to satisfy most types of consumers’ needs. Its brand portfolio shares points of parity such as customer-driven service and reward scheme, and points of differences in terms of price, quality and geography.
InterContinental brand has clear brand positioning whose final goal is to create Great Hotels Guests Love. They base their brand strategy on consumers’ perception of value that they adopt a multi-brand strategy worldwide forming different levels and types of hotel brands and properly priced and positioned (Huang, 2007).
Besides, IHG invests enormous capital to rebuild and revitalize its brands. It spent 1billion dollars in rebranding their hotel brand of Holiday Inn from 2007 and it will be completed in 2010 (Li, 2009). Such long term support on brand equity building will quicken and better IHG’s global branding process.
As Intercontinental is a top hotel brand with a long history, there are many things it should embrace with time changes. It should renew its brand with the pace of time and change of customers’ perceived value. Besides, more marketing activities in other countries will help build its brand equity since people might be not so familiar with the brand of InterContinental.
4. Overall Presentation of the brand report card assessment
Building strong brand equity is a key task that many companies are facing now. It is true of InterContinental Hotels Group. IHG has laid great emphasis on brand building and strengthening. Andrew Cosslett was appointed CEO of InterContinental Hotels Group as he used to be the marketing director of Unilever and Cadbury Schweppes from which indicates the importance of brand marketing (Business Voice, 2009).
IHG has seven brands under the group which cater for diverse target markets with price, quality, functional and geographical differentiations. The diverse brand portfolio of InterContinental helps it to chase and experience different business models. Each hotel brand tailors to a different customer.
It is difficult to assess a brand of how well it behaves. Usually the current marketing situation of the brand is a key criterion for people to reach a conclusion. While Keller’s ten attributes illustrated in his paper “The Brand Report Card” has shown a well thought-out, systematic approach to brand management and assessment.
This article applies Keller’s ten attributes that are shared by world strongest brands to Intercontinental brand portfolio. As a world top hotel brand, InterContinental has many attributes done quite well and successful such as its segmented market, clear brand image, proper brand positioning, immediate brand improvement, and so on.
However, they are still some points to be perfected. InterContinental Hotels & Resorts is positioned to provide ultimate life experience. But it should be priced and positioned more properly in different countries. Their famous brand Holiday Inn is now under rebuilding. Hotel Indigo is clearly targeted to attract style-conscious consumers and it need pay more attention on the change of customers’ perception of value. Holiday Inn Express caters for people who like simple and convenient service and it needs find better ways to maximize customers’ experiences with cheap and fine service. Candlewood Suites serves for mid-market and has a relative loose brand positioning.
It is no easy job to build worldwide brand equity and maintain the brand power increasing. Cheerful as InterContinental’s current accomplishments are, it needs more practice in brand management.
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