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People's Daily Online>>China Business

Hotel group develops Chinese brand

By Shi Yingying (China Daily)

09:02, March 19, 2012

Tea house instead of bar, signature local food rather than fine dining, foot message replacing spa: InterContinental Hotels Group (IHG) is doing everything it can to attract Chinese customers, including building up a new brand for the massive market.

Just 20 days after launching EVEN Hotels, the new hotel brand focusing on health in the United States, the United Kingdom's IHG PLC announced in Beijing the creation of Hualuxe Hotels & Resorts - a brand especially designed for Chinese people.

With its first property scheduled to open in late 2013, the upscale hotel brand says it will cover more than 100 Chinese cities within 15 to 20 years. The majority of Hualuxe properties will be located in second- and third-tier cities as well as Beijing and Shanghai.

"We're not fashioning an (already-existing international) brand in China. We're actually building up a new one from the ground for Chinese customers. It doesn't exist anywhere else in the world," said Keith Barr, chief executive officer of IHG Greater China, adding that Hualuxe is something like Yum! Brands' strategy of opening up East Dawning in China. Yum! Brands Inc owns KFC Corp and East Dawning is a strategy to fuse its business model with Chinese cuisine.

The company has confirmed 12 contracts in spots including Zhangjiajie and Changsha in Hunan province and Lijiang in Yunnan for Hualuxe properties, according to Zhao Huanyan, an analyst with Hotelsolution Consulting based in Shenzhen. "It's not strange at all for IHG to prefer second- and third-tier city over first tier cities," said Zhao. "About 65 percent of IHG's hotel rooms in China are scattered over second- and third-tier cities, if we look at the bigger picture here."

"IHG looked at 230 cities in China and narrowed them down to choose locations for Hualuxe. Beijing for example already has six Crowne Plazas and it would be difficult for us to have another six Hualuxe there when we have other cities that are becoming more urbanized," said Barr. Crowne Plaza is an upscale brand belonging to IHG.

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