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Part
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Holiday Inn Express - Revenue Channels
The exact channel revenue breakdown for specifically Holiday Inn Express was not publicly available in the annual and investor reports done by its parent company, IHG. Their reports were also not broken down by country. In order to search for this information, I thoroughly examined IHG annual and investor reports for the last 3 years, IHG and Holiday Inn Express websites, as well as third-party articles, surveys, and reports on the hotel industry. Instead, I was able to find IHG's global percentages of channel revenue contribution, which includes revenues from Holiday Inn Express for 2016:
Other channels (24.9%)
After finding similarities with IHG's and the top 50 hotel companies' channel breakdowns, it can be assumed that the breakdowns for Holiday Inn Express should not be too far from either the top 50 hotel companies' or IHG's channel breakdowns.
Through triangulation, I was also able to calculate that 25.91% of all revenue for Holiday Inn Express is from digital channels. Calculations are explained below. This may be due to industry trends towards digital media use and the mass popularity of its rewards program, which is offered on its mobile app and company website. The IHG Rewards Program was rated the #1 hotel rewards program in the world for 10 years by Global Traveler magazine.
Channel Breakdown
Although the channel breakdown for specifically Holiday Inn Express was not publicly available, I was able to find the global channel breakdown of its parent company IHG, which includes revenues from Holiday Inn Express. IHG's global percentages of channel revenue contribution in 2016 were:
All other channels, including direct conventional walk-ins, could be assumed to be included in the remaining (100% — 75.1%) 24.9%.
IHG's data is quite similar to the data from the top 50 hotel companies. According to data from TravelClick, the channel breakdown of the world's 50 leading hotel markets in 2015 was as follows:
(for about 100% with discrepancies due to rounding)
Data for GDS, OTA, Web/Mobile Direct, and call centers were fairly similar, with differences (IHG % — Industry %) being -3.6%, 3.6%, -0.4%, and -1.4% respectively. Considering this insight, the channel breakdowns for Holiday Inn Express exclusively should not be far from either the top 50 hotel companies' or IHG's channel breakdowns.
The biggest difference between the data from IHG and the top 50 hotel companies is the isolated data from IHG Rewards Club, which is covered later in the brief.
Digital Channels
Triangulation was made to further support the assumption that a large percentage of Holiday Inn Express revenues came from digital channels.
We can calculate the percentage of IHG revenues that come from Holiday Inn Express by:
($6.7 billion / $25.7 billion) * 100 = 37.74%
Thus, Holiday Inn Express revenues make up 37.74% of IHG's total revenue. If so, we can then calculate 37.74% of the $4.6 billion digital revenues:
$4.6 billion * 0.3774 = $1.736 billion
Now we can calculate the breakdown of digital channels for Holiday Inn Express:
(digital revenue / total revenue)
($1.736 billion / $6.7 billion) * 100 = 25.91%
This means that potentially 25.91% of all revenue for Holiday Inn Express is from digital channels. This may be due to the fact that IHG Rewards Club can be easily accessed digitally through its mobile app or direct website.
It could also be due to overall industry trends. According to Site Minder, "digital media is quickly becoming the only viable way for hotels to sell their rooms," and in 2017, "57% of hotel bookings were made online."
IHG Rewards Club
IHG aims to reinforce direct bookings (via its mobile app, direct website, call-ins, etc.) over indirect reservations (i.e. via online travel agencies). This is emphasized by its rewards club benefits only being available for direct reservations. This philosophy is applied to all of its hotel companies, including Holiday Inn Express. With 14.6% of IHG revenue coming from the rewards club, it should be assumed that the rewards program is a key revenue channel for IHG's hotel chains, including Holiday Inn Express.
PRnewswire.com explains that "with more than 100 million enrolled members globally, IHG® Rewards Club is the first and largest guest loyalty program in the hotel industry." It was also named "Best Hotel Rewards Program in the World ten years running as voted by the readers of Global Traveler magazine."
In May 2016, IHG introduced its "Your Rate by IHG Rewards Club" promotion, which offered exclusive discount rates for rewards club members if and only if they book directly through IHG. By doing so, IHG sought to provide cheaper rates than the average online travel agency.
In 2017, there were 2 million app downloads and bookings increased by 50%. IHG also integrated its rewards program with GrubHub and OpenTable, making IHG Rewards Club the "first hotel loyalty program to reward members with points for ordering takeout and dining out."
Conclusion
Although the channel breakdown for specifically Holiday Inn Express was not publicly available, I was able to find the global channel breakdown of its parent company IHG, which includes revenues from Holiday Inn Express. There were similarities when comparing the data from IHG and the top 50 hotel companies, and it can be assumed that the overall channel breakdown for Holiday Inn Express would be quite similar to both sets of data. Through triangulation, I was also able to find that 25.91% of all revenue for Holiday Inn Express is from digital channels. This may be due to industry trends towards digital media use and the mass popularity of its rewards program, which is offered on its mobile app and company website.