IHG faces the year with openings and optimism
The hotel chain works to promote post-pandemic recovery and enters new markets
IHG has been one of the hotel chains that has had the best performance during the pandemic, despite all the difficulties. The company has a great goal ahead of it: to consolidate growth in the face of recovery. To learn more about the current situation, during SAHIC we have been able to interview its COO Jorge Apaez and Salo Smaletz, VP Development Latin America. We share their responses below:
With what expectations have you come to SAHIC?
Jorge Apaez: “I think there are several aspects, the most important thing is to turn the page on the pandemic and come together again as an industry, have a presence, visit local clients in Panama, but mainly listen to the specialists who talk about what comes. They are optimistic scenarios in terms of air transportation trends, hotel demand recovery, advances in vaccination percentages and also the elimination of travel restrictions.”
Salo Smaletz: “It's been more than 2 years since we've seen many of those who are at the conference personally and it's totally different to do business with this format, there is a very great climate of optimism. You have to listen carefully to the stories and address the issues of each company, their experiences during the pandemic, etc. It is always something that enriches”.
The pandemic produced critical situations such as property closures. What is your vision regarding new developments in the hotel field?
Jorge Apaez: “Right now we are focusing on recovery, supporting all our franchisees, all owners, general managers and sales directors. We were fortunate that as a brand in general, the performance of hotels during the pandemic was less critical than the independent battery of the industry in general and in the recovery we are also seeing a faster recovery. Throughout the pandemic, the drop in rates was less in the IHG brands and today we are working on resuming promotional activities, making sales caravans with such clients, etc. We are expanding our infrastructure, we have opened a virtual reservation center with agents in Central America, we are going to reach a total of 200 agents who will take reservations in English and are based in Honduras, Guatemala and El Salvador. This is an alternative to the reservation center that we have also had for many years in Mexico City. The increase in the volume of calls has been such that we have had to strengthen the voice channel to serve the demand in the region. I think these are very positive signs. Regarding new openings, this year we have signed 2 and we have 7 openings scheduled for what is 2022”.
What conditions do you offer to investors who want to work with you?
Jorge Apaez: “One of the differentiating elements is that Intercontinental has a great history in the region, in fact, the first Intercontinental was opened in Belén and there were a large number of Intercontinental hotels developed by PANAM to accommodate high-power guests. purchasing power they brought on the airline. In the mid-nineties, the brand was acquired by IHG and since then we have developed new properties and the Holiday Inn brand has also celebrated more than 50 years of presence in Latin America and today it already has 237 hotels in the region. Today we are the international brand with the greatest presence, added to the fact that we provide service in the local language and with personnel based in the region, we have teams in Brazil, Argentina, Colombia, Central America and of course in Miami,
“I think that one of the things that is important to mention is that today we have 17 brands and the right product for each market, obviously we help the investor to decide the brand based on the location and also on the level of investment. We work together with the investors to be able to make the project successful.”
Salo Smaletz: “We offer two models that can be a franchise in which the owner manages his property or following IHG standards, but if he is an investor who does not want to get involved in the operation, we can offer him the management of private property with a administration contract. We have had relationships for many years throughout the history of our brands in the region and we have seen the generational change of investors, today those who are in charge of these businesses are a second generation from the family that obviously already has a different point of view focused on technology and what is happening today in the industry. We are glad that families who started with one hotel, later felt encouraged to open a second and even third hotel".
How informed are the investors who contact you?
Salo Smaletz: "The profile of the investor has changed a lot in recent years, today they have much more information available in the market through consultants specialized in the business and who assist them."
"We have a portfolio with a smaller number of brands so that each one has a well-defined profile and is therefore less confusing for the investor."
There are countries that have not recovered where demand is very low, are you doing any kind of action to support them in the recovery?
Jorge Apaez: “The answer is yes, first of all, we have supported a lot during the most critical months of the pandemic in the face of such a dramatic reduction in income. Today, as I mentioned at the time, we are more focused on recovery, we have already organized events with clients in markets such as Colombia and Brazil and soon we will be in the rest of the countries of the region, motivating clients to resume their business trips. We have been preparing campaigns, particularly we have shortly a great relaunch of our loyalty program that we are going to announce. We believe it will be the spearhead for those recovery efforts. Therefore, we have several components, including also working together with event organizers and corporate clients.
What plans do you have in the short term in terms of openings?
Jorge Apaez: “We plan to grow, we trust in the recovery of the business, I mentioned 7 openings this year, very important hotels are coming for IHG in the region. One of IHG's objectives is to increase our portfolio in the resort segment. We want to venture more strongly into the "all-inclusive" segment, and for this our development team is already negotiating very interesting opportunities in the Mexican Caribbean. We see that the post-pandemic presents us with the opportunity of a very intense new era.”
Salo Smaletz: “When the pandemic broke out, our owners felt protected and listened to. There was a will of our brand and the brands in general to support owners. As Jorge also mentioned, IHG in general achieved higher rates than those of the competition including independent hotels. There is one more lesson that the pandemic leaves behind which is having a brand is an advantage. Having a brand has its cost, or better said, it is an investment, but in difficult times, it gives you the security you will be supported”
Lately we have seen that there are American brands that are betting on opening all-inclusive hotels, are you planning this type of initiative?
Jorge Apaez: Yes, without a doubt we have a perfectly defined strategy towards the growth of the resort and it can be a "European plan" or "all-inclusive" and we believe that it will complement our brand portfolio very well. In addition, with the relaunch of the loyalty program, having more destinations with this type of property will make it even more attractive for customers who want to use their points.