India has a special place in Haitham Mattar’s heart, and he can’t wait to revisit the country. During his past trips to cities like Mumbai, New Delhi, Agra, Goa and Kolkata, he was enthralled by the vibrant culture, cuisine, history and heritage each place had to offer.
But more than that, he was awed by the remarkable resilience the people displayed and the nation’s capacity to survive challenging circumstances. “I definitely plan to visit India in the next few months and look forward to meeting our team and partners in person,” Mattar animatedly revealed. This will mark his first trip to the country after taking charge as IHG Hotels & Resorts’ Managing Director for India, Middle East and Africa in April 2021.
Interestingly, this is Mattar’s second stint with IHG – an organisation he was associated with for 11 years from 2000 to 2011 in various operations, commercial, sales and marketing positions in IMEA. Returning to its fold during COVID-19 impelled him to reinvent and replace several traditional management principles with innovative practices, in an era dictated by a social-distancing crisis.
COMRADES IN ARMS
A tour of India will also present Mattar with the opportunity to meet IHG’s owner partners, many of who reposed their faith in the company, recognising the long-term prospects of the sector. Backed by their conviction, the hospitality chain could expand its portfolio in the country and now, Mattar too is looking towards recovery with confidence as the market dynamics improve further.
Hotel owners had a tough time dealing with the recent black swan event. Staring at declining revenue and gross operating profits, they were forced to take some tough calls, from pruning operational processes to reducing staffing, and even reconsidering the fees paid to hotel management companies.
In his experience of close to 25 years in the hospitality sector, Mattar does not recall witnessing such testing times. Many of IHG’s hotels globally, including India, represent small, individually owned businesses, and the low demand, temporary closures and financial pressures presented by COVID-19 created enormous challenges.
However, he emphasised that as the industry edges towards recovery, the company is working closer than ever with its owners to provide vital operational and commercial support. “The strength of our business model and the speed and effectiveness of our support has been crucial for our owners, helping deliver RevPAR and guest satisfaction ahead of the industry in key markets and segments throughout 2020 and into 2021,” he elaborated.
SWITCHING GEARS
Knowing that recovery looks different for different markets and even hotels, IHG created tailored marketing plans that could best capture the local demand. And it did this by streamlining costs and operations, enhancing support for business customers, and protecting its loyalty members.
“During the peak of the pandemic, owners appreciated our market-tailored fee relief packages and options to defer payments. It gave them the flexibility to use the funds in other areas that were critical to protect the business,” Mattar stated.
IHG significantly reduced discretionary costs, marketing spends and capital expenditure, prioritising only what was needed to drive business recovery.
Globally, IHG also paused renovations and relaxed its brand standards. A key reason why it chose to be more flexible with its brand standards was to allow owners to save money. For instance, full-service properties were allowed to close buffets, reduce airport shuttle services and defer nonessential technology upgrades.
According to Mattar, taking these proactive measures was a no-brainer since IHG was clear that it would do everything in its power to help its owners control costs in a difficult trading environment. It closely collaborated with its partners in numerous ways – from providing financial and operational guidance, to establishing PPE supply chains and offsetting the increased cost of safety and cleanliness protocols with efficiency changes in other areas. This includes continuing to temporarily relax brand standards, while still maintaining quality and great guest experiences.
“For example, in EMEAA, including India, we have relaxed breakfast brand standards and developed a reduced offer for select hotels in response to local market restrictions and lower occupancy levels. Although this temporary approach varies based on market laws and local restrictions, we have carefully designed our product choices to ensure a degree of consistency across our estate and maintain the hallmarks of each of our brands,” he explained.
IHG Hotels & Resorts opened Holiday Inn Chandigarh Zirakpur and Holiday Inn hotel in Goa earlier this year.
Mattar added that it also significantly reduced discretionary costs, marketing spends and capital expenditure, prioritising only what was needed to drive the recovery. While one can’t dismiss the near-term challenges, he believed that owners share the company’s long-term confidence in the attractiveness of IHG’s portfolio and the markets it operates in.
FUTURE OF BUSINESS
Till last year, several hotel brands were offering services and amenities that most customers did not need, or ask. They did this in a bid to stay competitive and lucrative.
Now, though, many are leveraging data analytics to understand what customers truly want, in terms of services or even loyalty programmes. This can play a key role in optimising operational costs without impacting the guest experience.
A strong proponent of tech-adoption, Mattar believes that in a world where everyone expects seamless experiences, a hotel company’s digital capabilities form the crux of its offer for guests and owners. In IHG’s instance, its brand proposition for guests is as much about its booking experience, marketing and app functionality, as it is about the hotel destination and its brand hallmarks.
“For owners, our offer is about our ability to create revenue advantages through data and technology, as well as our scale and expertise. We understand this and we are investing in the technology, tools and solutions that make the biggest difference to our guests, owners and teams,” Mattar elucidated.
The company’s intuitive, cloud-based solution, IHG Concerto, is critical to the work the company is doing in this space. Blending core hotel applications into one seamless platform capable of enhancing the guest, owner and colleague experience, Mattar claimed that Concerto is the first of its kind in the hospitality industry. It gives IHG the ability to add regular releases with new functionality at pace and scale. This ensures that it continues to evolve how the guest stay is enriched and can meet new expectations, alongside driving stronger returns for its owners.
Explaining more, he said, “Our ‘Concerto for owners’ platform is playing a key role in helping manage
costs and assess property performance, displaying key metrics in real time on any device at a click of a button. Owners can see at a glance how a single hotel, or entire portfolio, is performing on metrics such as social media and Guest Love scorecards, RevPAR, financial and operational performance.”
Moreover, the tech portal will soon provide specific recommendations for actionable insights. It is currently available in Greater China, and will soon be rolled out in the Americas and EMEAA region as well.
FINDING ITS GROUND
When the pandemic struck, IHG’s team kept a close watch on the unfolding situation in India to get a better idea of market conditions, and lessons it could implement in its local processes. After the first wave dealt the industry a heavy blow, things seemed to be on the mend till the second wave hit business with greater severity.
This was when IHG realised that domestic travel demand would act as the bridge between survival and revival. Mattar noted that while the Indian market has always been driven by domestic tourism, it has gained even more traction in the current environment where international movement is restricted.
His observation is underlined by the significant surge in bookings and occupancy across IHG properties in the country. Its hotels in markets like New Delhi and Mumbai are currently recording over 60% occupancy with many hotels also crossing the 80% mark.
“This is a marked improvement from last year, when we saw a significant lull in business with lowest occupancies ever, touching 20% during the peak of the crisis,” Mattar pointed out. “With the growing
demand for domestic leisure travel, the average rates in our leisure hotels have reached almost the same levels as 2019.” While occupancies in key cities are bouncing back at a much faster pace, the average daily rate (ADR) for business hotels is still 25-30% lower than pre-pandemic times. But with an uptick
in leisure travel, the average rates in the leisure segment have reached almost the same levels as 2019.
During the festive season last year, IHG witnessed a significant increase in bookings especially for its hotels in NCR, Goa, Chennai, Agra and Jaipur. He expects a similar trend this year as well, with vaccination drives gain ground across the country. IHG is all set to capitalise on this growth curve by penetrating key markets and signing and opening new hotels across India.
Holiday Inn and Holiday Inn Express brands currently represent 75% of IHG’s operating portfolio in India.
Revealing these plans, Mattar said, “With a robust business model, our strategy for the country has been to respond to market needs and focus on our mainstream brands as our key growth drivers. Our ‘essentials collections’ which includes our Holiday Inn and Holiday Inn Express brands are a great fit for this segment and have done exceptionally well in India.”
These brands currently represent 75% of the company’s operating portfolio in the country and comprises
majority of its current pipeline. Besides, with a low cost of development, Mattar pointed out that they
make for an attractive investment choice for owners as well.
In terms of new projects, the company opened Holiday Inn Chandigarh Zirakpur and Holiday Inn hotel in Goa earlier this year. It also signed Holiday Inn Express & Suites in Jalandhar to strengthen its footprint in Punjab and also debuted its extended stay brand, Staybridge Suites in India with signing of Staybridge Suites Bengaluru Thanisandra.
“To deliver elevated guest experiences to our guests in the luxury segment, we will soon launch Six Senses Fort Barwara in Rajasthan – our first Six Senses property in India. Further, we are optimistic about the year ahead and are in active discussions to meaningfully expand our presence across key markets in the country,” Mattar said. He noted that IHG’s global brands such as Regent, Kimpton and Vignette Collections are a great fit for the Indian market, and he looks forward to introducing these brands with the right partners, at the right location and the right time.
ATTITUDE OF GRATITUDE
The challenges presented by the pandemic forced the entire industry to think innovatively and move with agility. IHG, too, realised the merits of being more solutions-focused and responding swiftly to the evolving consumer needs in a dynamic business environment. Mattar is proud that the company was quick to roll out a number of initiatives such as IHG Clean Promise, customised staycation packages, offers for its loyalty guests and customised MICE offering etc., to drive demand to its hotels. “We also identified new revenue channels such as food delivery segment, intimate weddings and events. These contributed significantly towards our revenue during these challenging times,” he noted.
During the pandemic, IHG created several initiatives to support associates, including flexible working practices, recharge days and virtual support sessions.
He added that the company has always been clear in its commitment as a company to ensure the wellbeing of its colleagues. Hence, during the pandemic, it created several initiatives and tools such as flexible working practices, recharge days, virtual support sessions, etc. to support associates.
The lockdown also offered Mattar a much-needed opportunity to stop, reflect and reprioritise as an individual. It helped him focus on self-improvement, physically and mentally. He recalled how he took more time to learn and invested in books he had never read before. Mattar considers the pandemic a big learning opportunity. “The unprecedented challenges brought by this event enabled me to become more self-aware and push myself to become a better person overall. It has helped me appreciate the simple things in life, including a walk in the park, without any restrictions.
It has also inculcated a deep sense of gratitude for every blessing in my life,” he gratefully said. He is now trying his best to strategically deploy these learning to act skillfully in challenging moments. He
is positive that this proactive step will go a long way increase the probability of successful outcomes for
himself as an individual and IHG as a company.
