IHG weathers storm to come out on top

Despite the challenge brought by the COVID-19 pandemic to the global hotel industry, the InterContinental Hotels Group has managed to achieve many milestones in China this year.

In recent months, the group marked the opening of its 50th InterContinental hotel, the 100th Crowne Plaza hotel, and the 200th Holiday Inn Express hotel in China.

The group also notched many firsts in China this year－it introduced a new brand "voco" to focus on conversion and new building opportunities in the upscale segment; opened the first wellness-centric "EVEN" hotel; and became the first international hotel group to partner with Ant Group, which enables guests to waive the hotel deposit based on their credit.

As one of the world's largest hotel operators and franchisers, IHG and its business model involve a wide variety of stakeholders both internally and externally. Partnerships and relations are essential for its business success in the market. Lu Haiqing, chief corporate affairs and strategic relations officer of IHG Greater China, shared with China Daily his insights on the hospitality industry in China and how IHG has recovered from the COVID-19 effects.

How do you see the effects of COVID-19 on the industry?

The COVID-19 pandemic is unprecedented. It is incomparable to 2003 SARS(severe acute respiratory syndrome), nor even the 1918 flu pandemic. No one could have a contingency plan for such a global pandemic, which impacted all aspects of society.

The virus greatly affected the hotel occupancy in the first quarter of this year, which went to as low as single digits. From the second quarter, business started to rebound and by the National Day holiday in October, the performance of our hotels had caught up to the same level with previous years and we are very positive about the fourth quarter.

What has IHG done in response to the crisis?

When a crisis comes, the first thing to do is to establish facts instead of panicking. Our executives held meetings every day in the first month of the outbreak to make sure we handled the unexpected situation efficiently and responsibly.

It's important to get in touch with government authorities and reliable media to learn about the situation and keep up with the development of the crisis.

Then we prioritized our tasks－we first reassured our employees and hotel owners, and then cut expenses in order to get through difficult times. We could see the successful epidemic control in China and got ourselves ready for the market recovery, which started to happen in May.

What changes have been brought to the industry?

Change is a constant in life, but there are things that could be eternal. People used to consider factors such as price and accessibility when they booked a hotel. But now they put hygiene on top of the list. Overall, people will pay more attention to safety. Technologies, such as teleconferencing and noncontact check-in, will become more common.

Some changes might be long-lasting, but at the same time they create opportunities. There is a Chinese proverb that goes: "Out of the deepest depth of misfortune comes bliss." The pursuit of a better life, the desire to travel and explore, and the longing for love and family will never change.

With the pandemic not ending, how should hotels deal with the new situation?

First from my point of view, we should follow the government's policies closely. Always judge the macro situation, find our place in the big picture and go with the flow.

For example, the country has been pushing forward the development of the Guangdong-Hong Kong-Macao Greater Bay Area, so we opened a regional office in Shenzhen. The government stresses opening-up, so we actively participated in the China International Import Expo. We opened Holiday Inn Express hotels along with the country's high-speed railway lines and have boldly invested in Hainan even before the government announced the island as a free trade zone.

Second, we should keep innovating in business models and in brands. We have to keep up with the trend of digitalization. The hotel industry is a traditional industry, which means we value culture, experience and quality. But, meanwhile, we should embrace changes more openly.

Last but not least, we should always get basics right. For example, IHG launched a Clean Promise program in June that includes deep cleaning with hospital-grade disinfectants. We should make sure that when guests are ready to travel again, we are ready to welcome them.

What's your view on China's "dual circulation" economic development pattern?

The "dual circulation" is a natural and necessary move amid the pandemic for China, because the country's huge economy cannot stop and wait for other countries to open again from the lockdown.

Since China's economy has grown to such a big scale, focusing on overseas markets alone and overlooking the huge domestic market is not a wise decision.

If one looks at the history of the United States, it was exactly doing what we call "dual circulation" now in the early 1900s－it strengthened its domestic infrastructure and market while expanding trade partners across the world, but it never became a closed economy.

Therefore, by boosting domestic consumption, China will not close doors to other countries, but rather become a world market.

And that's really good news for hotels and the whole service sector. We welcome people to spend their quality time at our hotels here in China.