Creating ‘moments of trust’ The key to building successful brand relationships in the Kinship Economy 2 Contents 2 Preface: Richard Solomons 4 Executive Summary 8 Introduction: The imperative of trust 10 SECTION 1: Securing the future in an uncertain world 11 Changing world 11 Changing consumers 12 Changing world of global brands 13 Brands in 3D 14 SECTION 2: The new Kinship Economy 16 SECTION 3: Global, local, personal 17 The benefits of global 18 The benefits of local 19 The benefits of personal 22 SECTION 4: 6 Actions for building trust 23 Securing guests’ trust 23 6 trust-building actions 34 SECTION 5: ‘Moments of trust’ 36 Conclusion: Creating kinship through ‘moments of trust’ 38 Appendix: Research methodology 1 Preface Richard Solomons To help us in our purpose of delivering trends that come today and are gone and personalisation means that brands Great Hotels Guest Love today and tomorrow; they are big trends that have need to stay relevant by becoming 3D – tomorrow, IHG looks forward over the next been developing over past decades. What managing their global, local and personal decade to understand how consumer and we are seeing now, however, is their assets simultaneously. marketplace trends are shaping guests’ collision, accelerated by the rapid rise of future expectations of hotel brands. technology-enabled personalisation. This Through the six trust-building actions this collision is shaping the experience our report highlights, we provide a blueprint Last year we published The New Kinship guests want when they travel. for how global brands in the hospitality Economy that evidenced a marketplace industry and beyond can leverage the transition from brand experiences The collision of these macro trends is macro trends of globalisation, localisation to brand relationships. We now put making the world feel more uncertain, and personalisation to create new value in relationships, not properties, at the and this uncertainty is impacting on the the services we deliver. heart of everything our hotel brands relationships with brands that travellers do, necessitating a shift away from are looking for. We have uncovered in our This sets out a vision for the ‘3D brands’ ‘transactions’ to ‘interactions’ with guests research an intersection between the of the future – brands that are global, that build lasting relationships. macro trends of globalisation, localisation local and personal. and personalisation that reduces this To help us – and others – on the journey uncertainty. This intersection is trust. If Richard Solomons to success in the new Kinship Economy, a brand can balance the macro trends by Chief Executive Officer we commissioned research from The being globally coherent, locally relevant InterContinental Futures Company that builds on our work and personally unique, consumers Hotels Group last year to understand what it is that will trust the service experience. And travellers around the world are likely to it is through building this trust that want from their relationships with hotel relationships will be secured over the brands over the coming decade. next decade. We have found that future success lies in Consumers trust brands with a heritage brands simultaneously managing three and they value the comfort and security macro trends: globalisation, localisation established global brands provide. But and personalisation. These are not the collision of globalisation, localisation 2 3 Executive Summary Creating ‘moments of trust’ – the key to both global and local. In recent years, and personal through six trust-building building successful brand relationships however, the rapid rise of technology- actions identified through the research. in the Kinship Economy enabled personalisation means that brands must now contend with a third • The research is based on a survey • IHG commissioned research into what dimension – being personal. of circa 7,000 business and leisure travellers are likely to want from their travellers from seven countries (US, relationships with hotel brands over the • Over the next decade, the challenge UK, Germany, Russia, China, Brazil and coming decade. facing global brands across all the UAE), along with qualitative depth consumer-facing industries is how to be interviews with travellers and expert • This report analyses the collision of 3D: globally coherent, locally relevant interviews. three macro trends – globalisation, and personally unique. localisation and personalisation – and The imperative of trust how this is producing an imbalance that • This report examines the benefits is impacting on the way brands have that being global, local and personal • IHG has uncovered an intersection traditionally engaged consumers. each brings to brand relationships. between the macro trends of It sets out a blueprint for brands to globalisation, localisation and • This imbalance poses a challenge transition from a 2D focus on global personalisation that is the key to for brands. Over the past decade, and local to a 3D perspective where building relationships – and this brands have focused on how to be they are simultaneously global, local intersection is trust. 4 • In a world that is becoming increasingly • The benefits of being global: do a better job at being innovative uncertain it is the comfort of trust compared to 66% of all travellers. that travellers are looking for. Trust • Global brands are well placed to will become one of the most valuable deliver consistently outstanding • Being both consistent and innovative currencies a brand can have in the brand experience every time: 71% of can be achieved if both serve the emerging new Kinship Economy. travellers rate global hotel brands promise of global coherence, as IHG Brands that build trust reduce as ‘always consistent’, increasing in demonstrates by its consistent track uncertainty while cementing enduring emerging markets. record of delivering innovation that connections. has been so important in building a • Travellers also expect global hotel coherent brand identity over time. The benefits of being global, local and brands to be the most innovative. personal This is especially true for the younger • The benefits of being local: generation of business travellers • The research highlights the importance – 75% of the Millennial ‘laptop and • Travellers now expect global brands of being global, local and personal to latte’ business travellers (a new to be relevant to their local tastes, the next generation of travellers: the traveller group born after 1982 and customs and cultures. “new global explorers” of travellers characterised by an attitude that from emerging markets and younger their office is wherever they happen • Travellers from emerging markets Millennial travellers. to be) think that global hotel brands hold this view most strongly: 68% of 5 travellers from Brazil, 60% from UAE 3D brands of the future The six trust building actions and 58% from China disagree with the statement “a global brand can never • For 21st Century consumers, the 1. Be consistent be a good fit with local culture”. global and local dimensions of brands • Hotels must provide a more meaningful no longer offer enough on their own. guarantee of consistency that is • For these travellers the more locally Global brands must be personal too, by not standardised hotels, but rather relevant a global brand is, the more adapting products and services that are individualised experiences that are trusted that brand is as a result of different from one person to the next. delivered within a consistent brand seeing their local and regional values Consumers want the reliability, safety, framework of global standards. reflected in the brand. and authority of global brands. They want the reflection of their local and • 45% of Millennial travellers agree that • The benefits of being personal: regional values. And, they want their a hotel with on-site dining options personal uniqueness respected and offering the foods that they would eat at • The rise of personalisation has addressed. home would motivate them to return to increased consumer expectations the hotel, compared to 55% of travellers across all industries. This is • For brands, this means managing the aged over 65. especially true for travellers in promises of being globally coherent, emerging markets. locally relevant and personally unique. 2. Deliver authentic local customisation The way brands can manage these • Global brands need to build trust by • The “new global explorers” (a three promises simultaneously is by customising their global offerings to new traveller group of travellers creating ‘moments of trust’ through reflect local variations that give guests originating from emerging service at every point in the customer reassurance they are experiencing economies) have higher expectations journey. something truly authentic to the locale. for personalisation than travellers The challenge for the hospitality from developed markets: 78% of • This research has identified six trust- industry is that what is considered ‘truly Russian and 64% of Chinese expect building actions for global brands genuine’ varies by generation. a hotel to tailor the experience that leverage the macro trends they have to their personal needs, of globalisation, localisation and • For older travellers, authenticity compared to 43% of US and 42% of personalisation to create ‘moments of is primarily about a demonstrable UK travellers. trust’. connection to local place. 72% of travellers aged over 65 agree that • In emerging markets,