IHG’s mantra for localization in China – be ‘fully embedded’

This is a viewpoint from China Travel Daily.This article appears as part of the tnooz sponsored content initiative.

When you understand data, technology, and media mix, by being in proximity with local partners, it can pave the way for apt localization, asserts Billy Turchin, VP, Digital and Voice, IHG Greater China, in a recent interview with ChinaTravelNews‘ Ritesh Gupta.

The wide ranging conversation focused on the question of the toughest challenge for any global business or brand to resonate with consumers in China.

It’s just not about data, technology, content, media planning and buying…there is more to it. Of course, the role of software platforms for email marketing, CRM, and digital advertising, or garnering data for setting up customer profiles and driving personalization at scale can’t be ignored by a marketer today.

“You can’t truly localize for China without being fully embedded in it,” says Billy Turchin, VP, Digital and Voice, IHG Greater China, who has been now living in China for last four months.

To his credit, Turchin has been associated with global businesses (including operations in China) for more than 10 years. And he has been working with IHG for over six years, working initially in global roles and now focusing on China.

“IHG has a very rich history here, being the first international hotel company in China. The group is continuously evolving its digital presence to be more relevant to the Chinese customer,” says Turchin, who is scheduled to speak at the upcoming TravelDaily Conference to be held in Shanghai on September 13 and 14.

Even localization has different connotations for different organizations and the approach can fail if not handled properly. Turchin recommends that one shouldn’t build solutions for China sitting outside of the country or don’t try to simply replicate what has worked in other markets.

Three key ways to engage Chinese consumers

As for the lessons he has learned from his previous experiences and time spent here, Turchin says localization would mean working in proximity with technology partners, marketing partners, understand the media landscape and observe consumers more closely.

“Difficult to do (localize) that if you aren’t here,” said Turchin.

Turchin referred to a few aspects of how IHG is gaining relevance by delivering a desirable guest experience to Chinese consumers.

The first: partnerships

One of the crucial aspects is to strike apt ties with local partners, be it for working with the BAT ecosystem (Baidu, Alibaba, and Tencent) or other media partners or media planning and buying agencies.

Citing an example of what’s working well for IHG at this juncture, Turchin referred to the company’s association with Baidu.

“We continue to innovate with Baidu and test new experiences. For example, with Baidu Brand Zone, we enable consumers to immerse themselves in a rich digital branded experience straight from the moment of search. So instead of just offering plain search results and then customers clicking through to a brand experience, we are able to bring that brand experience further upfront and reach the consumer within that search experience.”

Turchin also referred to a campaign with Hong Kong Tourism Board and XiaoMi, where IHG mainly planned an initiative to engage customers on the basis of their lifestyle. The XiaoMi campaign allowed IHG to reach customers in the XiaoMi channels and was run in conjunction with the 20thanniversary of Hong Kong’s return to China.

In conjunction with a marketing campaign, the group was running around `Your Rate’ (member exclusive rate), awareness was created about benefits of being a loyalty program member, including exclusive member pricing when a customer books directly with IHG.

“So as part of 20th anniversary of Hong Kong returning to the motherland, we did a new digital marketing campaign featuring ads on XiaoMi channels – advertised on video feed, XiaoMi browser, XiaoMi weather channel etc. We were able to highlight IHG content and lifestyle experiences.”

Being relevant and retaining global aura at the same time: As in case of global business, it is imperative to recruit the best of the local talent as part of plans to be localized for customers. “Being in the hospitality business, serving people – understanding their needs is of utmost importance,” said Turchin.

He said that being a global business, the company has to maintain a level of global consistency without losing out on local relevance.

“Also, our consumers are global, and we bring people together as a travel industry. We are constantly trying to deliver right messages and themes globally, yet tailor our branding and marketing for the local audience.”

For example, the company runs HUALUXE Hotels and Resorts, which is the first upscale international hotel brand designed specifically for Chinese guests. Overall, the group has 303 hotels currently within Greater China, and 262 in the pipeline, including Hong Kong, Macau and Taiwan.

Turchin also referred to IHG Rewards Club, one of that IHG has the world’s largest a single loyalty programs in the hospitality industry across the globe, and the company tailors benefits and experiences for local customers, but at the same time retains global consistency that customers come to expect from the group’s brands.

“Some companies may opt for a different and unique offering in China. So it means you break away for your brand, and a brand becomes “two brands”. We aren’t doing that. We continue to build and grow a globally relevant brand. And invest in experiences that can be tailored but globally consistent.”

The second: technology

Turchin pointed out that the entire marketing technology stack is quite different in China from the rest of the world.

For a category like advertising technology which tends to be complicated and fragmented, this calls for a market-specific consideration of demand side platforms (DSP) and data management platforms (DMP). So to be on top of auctions that happen in the time it takes for a web page to load a marketer needs to be in control.

This is how one makes the most of the spend on mobile banner ads, full-screen interstitials, video ads etc.

“Be it for DSP or DMP – leveraging 3rd party data, how do we onboard them 1st party data, where do we buy media etc. we need to plan differently for China. In the U. S., it could be Facebook Message feed, and in China, it could be WeChat Moment feed, so we have to be relevant in terms of where we are spending marketing dollars, always trying to measure and learn to improve efficacy by sending messages in the right location,” Turchin said.

The third: data

Of course, one of the main challenges in China is to deal with each ecosystem, and working on a single customer profile. There could be lack of uniformity in the overall guest experience if data isn’t aptly collected.

As for data transparency associated with different ecosystems, Turchin acknowledged that it is a challenge as there are different degrees of transparency. “So as a marketer we try to always measure and we want to find opportunities where we are able to use data to measure so that we are able to learn. If you can’t measure that it is tough to know what’s working. So we try to maintain the right balance, so we end up where our customers are. They use a variety of platforms and interact in different digital environments during the course of the day. We try to blend our spend appropriately across the whole funnel,” he said.

“We always try to encourage customers to come to our direct channels and book with us– that’s where they can have the richest branded experience and get the most benefits by becoming a member of IHG Rewards Club. So that way we get more 1st party data, and then it becomes a cycle where more data customers share better we are able to serve them.”

IHG has been focusing on building customer profiles and continues to invest in the single view of the customer. “It is not just about marketing but also about personalization,” said Turchin. “We want out staff to recognize guests, know their preferences, treat them the way they want to be treated, come up with relevant content and offers etc.” He said that the challenge when it comes to profiles is two-fold:

Getting data from more and more sources

How to use that data at the right touchpoint – could be a digital marketing experience or at the hotel, say at the front desk. “We are focusing on O2O – online to offline – how to marry the digital and physical experience,” shared Turchin.

China is doing as good or even better as any other market in terms of personalization for IHG. Turchin said as the staff communicates with loyalty program members, additional data is collected and the relationships grow over a period of time.

“So we are adept at serving our loyal customers specially in certain touchpoints. Of course, throughout the world, in case of anonymous consumers, it is always challenging to personalize the experience – we don’t know who they are. That’s where we leverage 3rd party data in some cases to try to come up with better targeting and some level of personalization but we have to build that data source for it to get better.”

So what to change, what to attain while localizing? It depends on the situation.

As Turchin points out, sometimes technology can help with dynamic content creation for example. But quite often it is the human touch, the core part of the business that’s what helps us stand out from the competition.

“We are able to empower our staff with apt customer data to personalize the trip, that’s what can be truly differentiating,” he said. The team can also empower technology that can do some of the work. “But I would like to reinforce that to localize you need to be in the market. IHG has had a long, sustained presence in China, and that has allowed us to tailor digital and physical experiences for the Chinese customer,” concluded Turchin.

Billy Turchin is scheduled to speak at the upcoming 2017 TravelDaily Conference (September 13-14, Shanghai). Click below to learn more.

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