InterContinental Hotels Group in £7m review

LONDON - The InterContinental Hotels Group is reviewing its £7m pan-European direct marketing business as it seeks to consolidate activity across its three core brands.

The review is a blow to incumbent Arc Worldwide, which was awarded the direct marketing accounts for two of the group's brands, Crowne Plaza and Holiday Inn, only two months ago.

Arc is understood to be on the shortlist for the pitch, which is scheduled for November. InterContinental declined to comment on the review, which will incorporate both strategic and creative activity, but it is believed to have approached several direct agencies.

The group's media planning and buying account, which is handled by PHD, is unaffected by the review.

Last year the company overtook hotel franchise group Cendant to become the world's biggest hotel chain, after embarking on a major expansion.

In July this year, InterContinental signed a franchise agreement for five new Holiday Inns in the UK, bringing its total to 100.

However, the group plans to sell several of its under-performing European hotels in deals worth almost £600m. One of its flagship properties, the InterContinental Hotel Paris, is among those up for sale.

Last month InterContinental launched a £500,000 integrated campaign for Holiday Inn through Arc using the strapline "It's the little things that make all the difference." The activity marked a departure from its traditional price-led approach.

Last year the group posted a 13% rise in its year-on-year operating profits to $296m (£165m).

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