InterContinental® Hotels Group (IHG) has launched its 2015 Trends Report, Building Trust Capital: The new business imperative in the Kinship Economy, which identifies the growing importance for companies to build both brand and organisational trust. IHG is publishing its report during the World Economic Forum (WEF), in Davos, which highlights the erosion of trust in public and private sector institutions as one of its key trends.
Many companies focus on the 3Cs of organisational wealth: Financial Capital, Intellectual Capital and Human Capital. Today, corporations must add a fourth ‘C’: generating, gathering and growing Trust Capital which represents the confidence consumers have in the credibility, integrity, leadership and responsibility of an organisation and its brands.
IHG’s 2015 Trends Report focuses on how organisations can build Trust Capital, unveiling a blueprint that organisations can follow to build trust with different demographics and across different geographies.
This insight is based on a series of related studies spanning a three-year period and involving nearly 40,000 interviews with international travellers worldwide. It is the third in a series of reports focusing on consumer insights impacting the hospitality industry and business in general. In 2013, IHG published ‘The New Kinship Economy‘, which highlighted a transition from brand experiences to brand relationships in the hospitality sector. The 2014 report, ‘Creating Moments of Trust – the key to building successful brand relationships in the Kinship Economy‘ built on this work and suggested that to win guest loyalty in the future, hotels need to deliver a global, local and personalised experience.
Richard Solomons, Chief Executive Officer, IHG, 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.”
Key insight: changing demographics
The report provides some important insights into our changing world that are having a direct impact on the way consumers build Trust Capital. One key trend is that consumers are getting older and younger all at the same time but not in all the same places. The demographic picture shows a large group of Boomers (born 1946-1964) and a large group of Millennials (born 1982-2000).
These two groups have very different mind-sets, world-views, different desires when travelling, and different approaches to brands and trust. The real opportunity for brands is strategically managing both of these groups at the same time. According to the research:
- Millennials prefer close, experiential relationships with brands whereas Boomers look for brand relationships that go smoothly, with no hitches or glitches:
- 23% of Millennials say they want to stay in hotels that say something about them, versus 11 % of Boomers
- Millennials are more apt to be ‘invisible Travellers’ than Boomers – people who can move through the guest journey without caring for people-enabled contact:
- 67% of Boomers say they would prefer to call a hotel and speak with ‘real’ people on-site for information, versus 56% of Millennials
- Millennials and Boomers have different desires when travelling as a family. Millennials look for places that have family-centric activities where their children will be well taken care of and will have fun. Boomers prefer everyone to be together in a multi-generational way.
The report argues that the changing nature of the family is also impacting how the consumer builds trust. It reveals that the Kinship Economy now has two kinds of kinship: kin, those who are our true family and kindred spirits. Appealing to a person’s two “networks” in relevant and differentiating manners is a positive (and cost-effective) way to gain and retain consumers.
The IHG Blueprint for generating Trust Capital
- Adopt a Trust Agenda within the organisation, led by the CEO, or ‘Chief Trust Officer’.
- Recognise that trust is not the same as reputation – both are equally important and should be treated so.
- Focus on personalisation, but know your limits.
- Acknowledge that every consumer is value conscious and that consumers determine value, not companies.
- Focus on the consumer’s new way of assessing brand value.
- Focus on building value through ‘one-think decision-making’.
- Distinguish repeat behaviour from real brand loyalty.
