The hotel group's 2015 Trends Report, published today, points out that that consumer perceptions of brand value have evolved, with perceived cost now about much more than price.
It focuses on how organisations can build ‘trust capital’, which ‘represents the confidence consumers have in the credibility, integrity, leadership and responsibility of an organisation and its brands’ and can both increase brand value and protect a business if there is a credibility issue or crisis.
“Consumers have evolved their definition of brand value. This new perception of brand value is a brand-building necessity,” states the report.
“Consumer-perceived brand value has three important components. First, the consumer has a new, more complex value equation in their mind as they evaluate brands. Second, trust is at the core of any brand relationship. Third, building brand value puts deposits into the company’s ‘trust bank’.”
Changing demographics
The report also offers insight into how changing consumer demographics are having an impact on the way consumers build trust capital.
It highlights the differences between 'boomers' (born 1946-1964) and 'millennials' (born 1982-2000), with millennials preferring close, experiential relationships with brands and boomers looking for brand relationships that go smoothly, with no hitches or glitches.
Additionally, it claims that millennials are more apt to be ‘invisible travellers’, and are less interested in people-enabled contact than boomers.
Changing world
The 2015 IHG trends report is the third of a series of reports focusing on consumer insights impacting the hospitality industry, and is based on nearly 40,000 interviews with international travellers worldwide.
It follows on from the 2013 report, which identified the ‘new kinship economy’ and the 2014 report, which suggested that brands hotels need to deliver a global, local and personalised experience to win guest loyalty.
Richard Solomons, IHG chief executive officer, said: “As we look around us, there are so many shifts taking place. In a digital, 24/7 world, where personalisation is increasing and consumers have a new definition of value, the trust that people have in both brands and the organisation behind them is more important than ever.
“Our research has shown that building ‘Trust Capital’ plays a critical role in delivering sustainable, high quality revenue growth. To build trust, organisations must ensure they adopt a trust agenda, focus on personalisation whilst being aware of the boundaries and develop a deep understanding of how guest needs are changing by demographic and by geography.
“For IHG, maintaining our focus in these areas will help us to continue to build genuine guest loyalty and rewarding relationships between our guests and our brands, now and into the future.”