IHG:building a hotel for the Chinese

　　Keith Barr, greater China CEO of InterContinental Hotels Group, thinks the balance of power between Western brands and Chinese consumers may be at a tipping point.

　　“In the past, the Western brands have come in and shaped the preferences of Chinese consumers, it has all been one-way: all ‘in’ and very little ‘out’,” he says. But now, with China sprouting a massive middle class – in under 15 years it will be twice the size of that in the US, he says – Western brands will have to learn to listen more closely to what Chinese consumers want, he said in Shanghai on Tuesday.

　　In the tourism industry, for example, the writing is already on the wall. China will have as many hotel rooms as the US by 2025 – and the people who stay in them will inevitably have a big influence, not just on tourism in China, but overseas as well. “Chinese travellers will change the world, just like the Japanese did,” he says – except that the China wave will dwarf the Japan effect.

　　“If you want to see any of the major sites of the world, you had better do it soon,” he says, quoting an unnamed global hotel executive – before the Chinese arrive en masse.

　　Already the balance of IHG’s business in China has swung sharply toward domestic travelers, he says: 75 per cent of guests are domestic, and many of the remaining 25 per cent are other Asians. Europeans and Americans are a small minority.

　　So IHG – the largest branded hotel group in China – is planning a new “China-centric” brand to make sure it does not go the way of Best Buy and Barbie. The new brand, whose first hotels will open in China late next year, will also be exported overseas – to serve Chinese travellers abroad.

　　The new upscale “China-centric” brand will “strip away the Western view of a hotel and put a Chinese lens on it” by focusing on how business is done in China – rather than in the West – and setting out to meet the unique needs of the Chinese businessman. “Business does not get done in the bar in China, but hotels in China always build a big bar. Businessmen in China don’t go there”, he says. Business gets done around a dinner table, often in a private dining room – and the new brand will translate that insight into its design.

　　“We will have to completely readjust our Western view of social spaces, and the role of private vs public spaces,” he says – and then reproduce that in city after city across China. Maybe one day, we will all be staying in hotels with Chinese characteristics.