InterContinental Hotels Group, New World Leader In The Hotel Industry – MKG Reports
MKG exclusive: 2004 worldwide ranking of hotel groups
- By acquiring the American group, Candelwood Suites, the British InterContinental Hotels Group (formerly Six Continents) has taken a leap forward, allowing it for the first time in its history to take over the former world leader, Cendant. The latter recorded a drop in its supply of rooms, which resulted from a more rigorous policy that led to the “cleaning” of its network.
- Within a particularly difficult context, the ranking of the largest hotel groups in the world has remained practically unchanged, since all have continued their expansion, notably through franchising. Corporate-run chains, which strongly increased the name-recognition of their brands, did not hesitate in using franchising to spread to geographical regions where they were absent. The race to the globalisation of brands has definitely begun, led by IT network sales technology.
- Despite a continued policy of tightening membership criteria, leading to the removal of some of its previous members, Best Western remains the brand with the widest global coverage, with a very slight increase.
- Two brands greatly expanded in 2003: Express by Holiday Inn (+10.2% in number of rooms) and Novotel (+7.3% in number of rooms).
Annual worldwide ranking of hotel groups (YTD 01/01/2004)
Annual worldwide ranking of hotel brands (YTD 01/01/2004)
Within a delicate international context, the major event of 2003 will remain, without a doubt, the rising of InterContinental Hotels Group to the top position in the hotel group ranking. The acquisition of Candlewood Suites in the USA for a total of 15 million dollars brings the number of its hotels to 3,520 for 536,518 rooms. At the same time, Cendant, which dominated the worldwide hotel industry, recorded a drop in the number of its rooms, which nevertheless still totals 6,403 units and 518,435 rooms.
The other leading groups in the worldwide hotel industry were not inactive however. Marriott solidified its third place with an increase of more than 26,000 rooms, which corresponds to a rise of 5.7%. Accor continued its international expansion. As of January 2004, the global supply of the European leader totalled 453,403 rooms. The other American groups also displayed strong growth. Choice continued its development through franchising and expanded its supply by 4%, as did both Hilton Corp. and Carlson Hospitality Worldwide.Once again, this year Best Western continued restructuring its network. By reinforcing its membership standards, the brand increased by 0.4%. With a supply of 4,110 units and 310,245 rooms, Best Western nevertheless remained the largest brand in the world. The brand ranking this year did not show any major movement among the heavyweights. Hampton Inn moved up the list by one place and is currently ahead of Super 8 Motels, in 7th place. Among the most remarkable advancements among the 20 largest hotel brands, we notice the increase of Novotel (+7.3%) and of Express by Holiday Inn (+10.2%). The budget brand of the British group thus rose one spot, which confirms the ambition of de InterContinental Hotels Group on this segment. The largest falls in supply concerned Cendant. Ramada Franchise Systems Inc. notably say a drop of 9.9%.
Finally, the first elements of the worldwide assessment of the hotel industry leads to the conclusion that despite the difficulties encountered in 2003, the major global operators have maintained steady development in the conquest of new market shares. Thus, the 10 largest groups in the world increased by 2.3% in 2003 (+78,309 rooms) versus a rise of 2.6% at the end of 2002. For 2004, a census of hotel group development projects, undertaken by MKG Consulting identified 80,000 additional rooms throughout the world, i.e. a volume corresponding to that of the expansion of the 10 largest groups in the world this year.
MKG Consulting has the largest hotel database in the world outside the USA, with the best coverage of all hotel segments. The MKG Consulting database gathers monthly the data from 40,000 hotels, representing over 2.2 million rooms. The activity results of the MKG Consulting database concern a sample of 9,000 corporate-run chain hotels, representing 1 million rooms. These results are supplied by chain hotels throughout the world, for which MKG Consulting is the official supplier of statistics.
