August 17, 2022

With the recent changes to IHG’s loyalty program, a lot more guests have access to club lounges. Could we see hotel get creative in order to avoid this, though? The actions of one hotel suggest so…

The challenges with IHG’s new elite perks

The IHG One Rewards program was recently revamped, and elite perks are much stronger than before. In addition to the general perks of IHG One Rewards Platinum and IHG One Rewards Diamond, we’ve also seen the introduction of IHG One Rewards Milestone Rewards, which offers benefits like club lounge access, confirmed suite upgrades, and more.

These changes are of course fantastic news for frequent guests, as they’ll be rewarded much more generously than before. However, this also presents a challenge for hotels when it comes to delivering on these promises.

Take club lounge access, for example. Any IHG One Rewards member that earns 40 elite nights in a year can choose to receive club lounge access for all their stays. As a point of comparison, previously only InterContinental Royal Ambassador members received lounge access, and that was an exclusive, invitation-only elite status.

I think it’s safe to say that the number of guests potentially eligible for lounge access at InterContinentals is increasing significantly with the new program. This becomes a challenge for hotels on several levels:

  • Hotels design club lounges based on forecasted occupancy, and many InterContinental club lounges simply don’t have the capacity to handle the influx of guests we’re going to see
  • There’s no denying that when club lounges go from being profit centers to cost centers, the experience gets much worse; just compare Ritz-Carlton club lounges (which elite members don’t get access to) to just about any other club lounges that you can get access to based on elite status

So how do hotels strike the right balance? I’m not sure there’s a perfect answer, but one hotel’s actions perhaps present a roadmap of what we could see at other hotels as well…

Club InterContinental at the InterContinental Paris Le Grand

InterContinental renames club lounge to avoid elite access

A FlyerTalk thread covers discussions happening in a frequent traveler forum in China, about what’s going on at the InterContinental Changsha. The hotel used to have a standard club lounge. However, with the introduction of the new IHG One Rewards program, the hotel has made some changes:

  • The Club InterContinental has been replaced by “Jade on 27,” which is basically the same thing with a different name; it’s described as an “all inclusive food and beverage venue”
  • Jade on 27 is only accessible by guests paying specifically for a room including access to this
  • Meanwhile Club InterContinental guests are being directed to a special area of the lobby lounge, allegedly only offering light snacks and soft drinks, so that’s a significantly scaled back offering
  • It’s claimed that IHG customer support has made it clear that this is within the terms & conditions, since access to some sort of lounge is still being offered to eligible guests

On the one hand, this is ridiculous and not within the spirit of IHG’s loyalty program. On the other hand, if the club lounge was actually getting busy to the point that it was overcrowded and taking away from the regular experience, what’s the hotel to do? Not only does this increase the costs of operating the lounge, but it also potentially decreases revenue, as paying lounge guests may no longer do so if it’s not a relaxing space.

This seems to be the only hotel where this has been done so far, though I wouldn’t be surprised to see this spread.

Jade on 27, NOT Club InterContinental

Bottom line

IHG has significantly improved elite perks, including a new easy path to accessing club lounges. This is great for guests, but presents a challenge for hotels, as they’re going to see an influx of guests eligible for access.

It looks like at least one hotel is dealing with this issue by renaming its club lounge, and only offering access to paying guests. Meanwhile other guests can get a much more limited food & drink selection in the lobby lounge.

I’m curious to see if this practice spreads, and how IHG hotels do in general with executing on IHG’s great new elite perks.

Do you think we’ll see more InterContinental properties take a similar approach?

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