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InformationWeek 500: Search, Mobility, BI Keys To Chain's Growth

Job one for InterContinental Hotels Group: Build customer loyalty.

Untethered Concierge

Mobility is another area of emphasis. The company receives about $2.5 million a month from mobile bookings--a 400% increase over last year. IHG's iPhone app is the most downloaded in the hotel industry, and the company recently added an Android app. "We expect our mobile business to grow exponentially," Conophy says. "People want powerful computing in their hands, and for it to be intuitive and rapid."

Experimentation is the name of the game in the mobile world, says Bryson Koehler, IHG's senior VP of revenue and guest technology. "I couldn't tell you exactly what our focus is going to be because it's changing so rapidly," he says, comparing mobility to the Internet of the 1990s.

In fact, mobility increasingly factors into guests' in-hotel experiences. IHG recently began testing Apple iPads at InterContinental hotels to get concierge staff out from behind their desks and engage guests.

Going forward, guests will be able to use their smartphones to check in and even unlock their rooms. Concierges will be able to push sightseeing itineraries to guests' mobile devices, and guests will be able to transmit their preferences from their devices to the hotel before they check in, under a concept IHG calls "Virtually Me."

IHG By The Numbers
$772 million in revenue for the first half of 2010, and $8.9 billion with all franchises
$200 million IT budget; 800-person IT organization
4,503 hotels and 656,661 rooms in operation
1,302 hotels with 197,431 rooms under development
132 hotels in operation in China, with another 148 hotels under development
$1 billion relaunch of Holiday Inn brand under way
That future is fast approaching. Testing of a mobile door-unlocking capability provided by startup OpenWays came out of IHG's lab and went into Holiday Inns in Houston and Chicago in mid-August. With that technology, the hotel gives a guest a special number to punch in from her cell phone, which then emits a special sound that unlocks the door when the phone is placed against a receiver attached to the door lock. Says Conophy: "We want to endear our brands to guests so they come back, and in doing so you've got to have technologies supporting their stay."

Hotel In A Box

IHG's 800-person IT organization works mostly from the Atlanta headquarters, while IT personnel in franchise locations--which account for 95% of the company's U.S. hotels--comprise a larger matrixed organization. IHG spends a bit more than $200 million annually on IT, or about 1.2% of revenue, less than competitors Hilton, Starwood, and Marriott. Franchise properties aren't required to use IHG platforms, but they typically use its reservations and property management systems.

IHG makes it easier for franchisees to adopt corporate-recommended tech via its "hotel in a box"--everything from hosted PBXs and servers to point-of-sale systems in one package. IHG partnered with IBM to provide that IT as a service. "Hotels were asking us what to do, but it was hard to do this for as many as two new hotels opening each day," says Gustaaf Schrils, IHG's VP of global technology for the Americas. The hotel-in-a-box costs are 5% to 10% lower for hotel operators than a do-it-yourself approach, Schrils says.

In another effort to cut costs (and its carbon footprint), IHG last year launched Green Engage, a Web-based pilot system developed with Harvard University. Under the program, hotel operators record monthly utilities usage, among other data, and the system tells them whether their properties are efficient based on city, state, and occupancy norms, and then it makes recommendations--for example, where to install LED lighting. As a next step, the company will gather energy data using technology such as water flow readers. Conophy estimates Green Engage could save IHG hotel operators as much as $400 million annually.

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