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Intercontinental Hotels Boss Andy Cosslett
 Obsessed by the Importance of Branding
By Tamsin Brown, Daily Mail, LondonMcClatchy-Tribune Business News

Nov. 30, 2006 -- Many of us complain about the daily commute to work. But you have to pity Intercontinental Hotels boss Andy Cosslett who has flown on occasion from Australia to London for a single business meeting, only to hop back on the plane the same day for the return leg.

This is life for Cosslett, the thick set, rugby-mad chief executive of the world's biggest hotelier, who even at 51 looks like he would be fairly handy around a ruck or maul. He has hotels in 100 different countries, including the InterContinental, Crowne Plaza and Holiday Inn chains.

Cosslett estimates he spends 40pc of his time jetting round the globe, meeting staff, signing up new customers and making a point of personally inspecting the hotels he visits.

Travel wasn't always a part of his life. He didn't start going overseas until his mid-20's and holidays during his "classic Manchester upbringing" were to Cornwall, Wales and the Isle of Wight.

Chatting over a cup of tea in a cafe at InterContinental's Crowne Plaza hotel at Blackfriars, having just come back from trips to Japan, Canada and Switzerland, he seems relaxed and clearly takes the global commuting in his stride.

What he's not so happy about is his Air Miles. Not the miles in particular -- he must have thousands of them -- but the fact he can't get the flights he wants to take his family on holiday.

He switches from being laid back to railing about how "absolutely disgraceful" the whole situation is. Yet he uses the opportunity to insert a plug for InterContinental Hotels" rewards scheme.

"In our hotel scheme you can use your points when you want," he boasts. "We've just launched a scheme where you can redeem them with our competitor hotels.

Cosslett is a marketeer and obsessed by the importance of branding. In fact he was brought in because he possessed those skills --- the attributes chairman David Webster thought would be required to reform and reshape the hotelier in this modern era.

Today he will relaunch the InterContinental brand, making it more contemporary and targeted at a slightly younger audience.

He developed this passion for sales and marketing in his years at consumer goods giants Unilever and Cadbury Schweppes. And it was this wealth of experience that made him an ideal candidate to take IHG forward.

hotels business is changing.

The ownership and upkeep of the bricks and mortar is being severed-from the management, leaving companies like IHG to focus on getting their brands into as many towns and cities around the world as they can. IHG has been at the vanguard of this and owns just 24 of the 3,680 hotels it manages. The group, which began life as part of Bass breweries, has returned £2.7bn to shareholders since listing in 2003 after selling 176 hotels.

By distancing itself from the property, it doesn't have to invest its own money to build new hotels. It has got about 144,000 rooms in the pipeline at the moment, which would have cost it about £5.6bn to build. And by focusing on managing hotels rather than owning them, IHG is protected from the fall in room rates in a downturn. This, however, does means it doesn't get such a boost when the industry is booming.

"Building up our operating system and making our brands attractive is what our business is now about," explains Cosslett, slipping into management speak. What he means is he would rather be spending money promoting IHG than fixing up and repairing hotels. Property is hot in the investment market at the moment, bringing with it a flood of cash. But if pension funds and big professional investors are buying hotels, they want a recognised brand backing it.

"The institutional investors want a known quantity -- they don't want to take a gamble on something they've never heard of. So we need to get our brands bigger." Listening to his branding mantra, it's hard to ignore the fact that the cafe we're in at Blackfriars" Crowne Plaza could be straight out of a mainline railway station. Perhaps it is a work in progress.

Cosslett talks with excitement about how the hotel industry is at a "tipping point." "Over the next decade, when you look out this window every fourth or fifth face is going to be Chinese because the volume of travellers coming out of China is going to go up by factor of ten," he says pointing to the rainy London street outside. Travelling within China is also expected to mushroom and InterContinental, which has been there longer than any other international operator, is prepared, with plans to have 125 hotels open by the end of 2008.

"The Chinese government is pushing westwards -- trying to get industrial growth into the heartlandof China and away from the costly east. As it does that it is putting in all this infrastructure -- 47 airports are currently under construction as are 80-odd thousand kilometres of freeways.

"When President Eisenhower built the freeway system in America, Holiday Inn just followed it. The same thing is happening in China 50 years on."

Beneath all the marketing spiel, Cosslett is down to earth. He jokes that he quit playing rugby after 30 years when he turned up at a board meeting with stitches in his eye. His chairman suggested it was perhaps time he gave up. But it was bound to have been a difficult call given that his dad Edward Cosslett played against the All Blacks, while his stepdad John Burgess coached England in the 1970's.

These days Cosslett is learning the guitar from his son in his spare time. This interest recently led him to reproach staff at one hotel about the music they were playing.

"It was an airport hotel in Europe and most people there were young business travellers. They were playing something like Meat Loaf's Bat Out of Hell and it was middle of the day."

He was clearly flabbergasted and demanded to know who chose the music. It was Gus the barman. "They were amazed I was asking the question. Retailers have understood it for years, the whole sensory engagement. But the sound and smell has really not been thought out yet in this industry to the extent it will be in the future."

The group has come a long way from the days it was part of a British brewer, and shareholders have been rewarded. But with 60pc of hotel rooms in the world not branded, there is still plenty of flag hoisting left for Cosslett to do. And a lot more air miles for him to collect.

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To see more of the Daily Mail and the Financial Mail on Sunday, or to subscribe to the newspaper, go to http://www.thisismoney.com.

Copyright (c) 2006, Daily Mail, London

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