Exclusive Interview With Zhou Zhuoling, Chief Executive Of Intercontinental Hotel Group Greater China (Jolyon Bulley): Cautiously Optimistic About The Recovery Of Hotel Industry, Accelerating The Chain Of Single Hotel.

With the promotion of the resumption of work and production, the hotel industry is gradually returning to the blood, and the main hotels, which rely mainly on OTA and individual customers, are facing more tests in the aspect of income generation.

As the epidemic enters normal control, consumers generally prefer chain hotels with better hygienic quality and higher quality.

In response, Zhou Zhuoling, chief executive officer of InterContinental Hotel group Greater China (Jolyon) Bulley, in an interview with the twenty-first Century economic news reporter, said that the epidemic did accelerate the reorganization of the chain brand to the high-quality local single hotels. At present, the performance of the hotels is showing a phased feature. Meanwhile, the market of the hotels in the first tier cities is becoming saturated, and the market will be transferred to the market in the future.

Increase in occupancy rate

Twenty-first Century: what is the current status of the Inter Continental Hotel reemployment in China? What is the change of hotel occupancy rate?

Zhou Zhuoling: at present, the hotels in Greater China are almost completely reopened, and the recovery of the market will be a phased process. With the first revival of short distance travel, hotel performance in the vicinity of major cities and popular spots is most evident. The gradual recovery of travel has also brought about improvement in hotel performance in commercial destinations.

In different hotel categories, we can see that the recovery of the mid-range hotels is ahead of the luxury and high-end plates, which is undoubtedly a great benefit for us with Holiday Inn and the two middle and end brands of the Holiday Inn.

On the other hand, most countries' borders have not yet been lifted. This year can be seen as a golden opportunity for the demand for domestic travel. The demand for luxury travel experience is urgently needed. This brings opportunities for our high-end and El Luxor Hotel needs.

Twenty-first Century: we are all looking forward to the "retaliatory consumption" after the epidemic. Do you expect the hotel industry to recover rapidly after the outbreak, or will it slow down?

Zhou Zhuoling: the travel demand of consumers is very exuberant, but now from the behavior of booking hotel, it should be "cautiously optimistic". For example, according to our group data, the time of advance booking for customers is shorter than before. Most of the hotel reservation for leisure travel occurs within a week before check-in, or even many customers. The next day or the day is booked, which shows that everyone's wait-and-see mood is obvious.

From the point of view of city or region, the demand of Yunnan, Sichuan, Sanya and other natural scenery hotels is relatively large.

Monomer hotel reorganizing acceleration

Twenty-first Century: Intercontinental has recently introduced the high-end hotel brand of voco into China. Is this a plan that has been brewing in the intercontinental or intercontinental has seen the quality of the hotel after the epidemic, hoping to take the opportunity to promote this project?

Zhou Zhuoling: we have seen the growth opportunities of high-end hotel sections. The launch of voco aims at strengthening the brand supply of InterContinental Hotel group in the high-end sector, and based on the insight into the needs of consumers, we also see the needs of the owners in this area.

After the launch of the voco brand in June 2018, we began to introduce voco into China to conduct preliminary market research to decide whether to introduce the brand and how to land in China, such as the study of which brands should take the lead in entering China's market, whether the owners have their own brands into voco's wishes and needs, and what kind of consumers do they have for such hotels. Demand. Finally, we launched the voco brand in Greater China area this year and signed the first project in Wuhan, which is the result of the consumption trend and the needs of the owners. Voco has also become the eleventh brand that InterContinental Hotel group introduced into greater China.

Twenty-first Century: compared with Europe and the United States, the domestic chain rate is still relatively low, and the monomer hotel in this outbreak is more affected. Will the epidemic speed up the integration of chain hotel brand integration monomer hotel?

Zhou Zhuoling: according to the data of STR, the chain of monomer hotels in China has been developing for several years. Since 2018, the movement of integration opportunities for single hotels has been heating up all over the world. Tradition Hotel management group, OTA and capital have entered. But the current situation is that China's hotel chain is still very low. Data show that China's hotel market overall chain rate is only 24%, while the United States this figure reached 71%.

After the epidemic, the owner realized the importance of cash flow to the hotel's ability to resist risks, and paid more attention to return on investment and hotel operating income. Under the epidemic situation, chain brands are well received by the owners of single hotels because they are backed by the support of the large hotel group and have the advantages of good resistance and quick response. That is to say, the epidemic will speed up the renovation and flop of hotel stock assets and provide an opportunity for the hotel industry to upgrade its products and services.

Twenty-first Century: Bai Siyuan, chief executive of InterContinental Hotel group (Keith Barr) also mentioned that OTA is learning to make hotels. Does that mean that the advantages of chain hotels are obvious, and the attraction for single hotels is larger than that of OTA? Will OTA be a threat to chain hotels, or will the two party be more inclined to cooperate?

Zhou Zhuoling: as an international hotel group that has ploughed China for 36 years, we have rich experience in international brand operation and deep insight into China's local market. For single hotel, we have advantages in risk management, scale reduction, cost analysis, market analysis and forecast, hotel targeted support and distribution channels, so as to ensure timely and effective brand, operation and system support for owners and hotels.

InterContinental Hotel group recently entered into strategic cooperation with Ctrip group and opened our first official flagship store in OTA, which can be seen as a good case for exploring positive cooperation with OTA. It is of special significance at the time of the recovery of Chinese hotel market in the post epidemic period.

Mid End Hotel continues to sink

Twenty-first Century: now the middle end market is already the Red Sea. How big is the space in the middle market of the first tier cities?

Zhou Zhuoling: with the rapid development of China's hotel industry in recent years, the hotel resources in the first tier cities have been saturated, and there have been some problems of homogenization. At present, while maintaining the leading position in a second tier city, we aim to target new tourism markets, sink the brand to three or four tier cities, and all kinds of popular tourism and holiday destinations.

The epidemic will lead to economic damage. The consumption capacity of the hotel market will be affected. The budget of both the business trip and the tourist trip has been reduced. Therefore, the occupancy rate of the high end and El Luxor Hotel may be reduced in the short term, while the traditional Econo Hotel is difficult to meet the current main market consumer demand in terms of product service and quality. Therefore, the market demand of the mid-range hotel will enter one. Step up, showing the trend of supply and demand.

Twenty-first Century: Intercontinental has laid part of the mid end hotel business outside the 234 tier cities in recent years. How will the mid end hotel market be laid out in the future?

Zhou Zhuoling: we will continue to make in-depth arrangements for the three or four tier cities and emerging markets. In addition, we will continue to enter more tourist attractions to meet the needs of upgrading domestic tourist accommodation after the upgrading of mass consumption. As of March 31, 2020, about 475 3/4 intercontinental hotels in Greater China were located in 234 line cities, 411 in built hotels, and about 90% in 234 tier cities.

Twenty-first Century: will InterContinental Hotels introduce more hotels outside the first tier cities through franchising? In terms of the experience of the intercontinental itself, what difficulties are facing the middle end hotel sinking?

Zhou Zhuoling: the franchise mode helps our hotel brand sink to more two to four line cities and popular tourist destinations, but also helps to further promote the development of the high-end hotel market.

The difficulties of sina hotel's sinking include the competition of homogenization, talent development and so on. But difficulties are also opportunities. In the differential competition, we select Holiday Inn in the product update iteration to tighten up with the new generation of consumers' preferences and aspirations. In 2017, the "new generation" design was launched with more distinct colors, more fashionable design, more practical function and more flexible space. In terms of talent cultivation, InterContinental Hotel group elite training institute has set up 94 schools in the whole country, conveying a large number of professionals to the industry every year.

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