Holiday Inn 2013 Annual Report Download - page 26

1
2
4
5
3
1
2
4
5
3
Build and leverage scale
For each of our brands, we aim to deliver high-quality growth
through building scale positions in the most attractive geographic
markets. In key cities, we build scale through increasing our
market share of rooms in that location. As our brands focus on
a range of occasion segments meeting guest needs in different
ways (see page 29), we use our consumer research to target the
right brands for each location.
Increased scale enables us to drive more revenue and create cost
synergies for both IHG and our owners. More hotels in an area
encourages guests to use our direct reservation channels to search
and book our hotels and provides corporate customers with good
coverage of key locations. We can also centralise and co-ordinate
operational support, national or city-level marketing campaigns
and deliver efficient procurement practices, including negotiating
reduced commission rates with online travel agencies.
Net rooms supply, Total gross revenue, Fee revenues, RevPAR, System
contribution to revenue and Fee margins are KPIs – see pages 38 and 39.
The principal risks associated with Owner proposition are set out on
page 37.
Strong brand portfolio
&loyalty programme
By building a strong brand portfolio and loyalty programme,
IHG is able to offer an unparalleled choice for guests and owners.
Our nine complementary brands are connected through a leading
loyalty programme. IHG’s loyalty programme was relaunched on
1 July 2013 with a new name: IHG Rewards Club (previously Priority
Club Rewards), reflecting the history of innovation, reliability and
integrity that is at the heart of IHG. The name, IHG Rewards Club,
clearly identifies all our brands together under the IHG family and
has driven a 10 percentage point increase in the awareness of IHG
as a brand family.
Through our strong brands and loyalty programme we are able to:
• cross-sell each of our brands, recognising that guests stay
across our brand portfolio, depending on their needs and the
occasion (see page 29);
• strengthen our owner proposition by increasing the number and
winning the loyalty of our guests, thereby driving higher RevPAR
premiums and increasing total gross revenue (see page 26); and
• encourage more direct bookings, increasing revenue for IHG’s
owners (see page 25).
In 2013, IHG Rewards Club delivered around 38.2 per cent of total
rooms revenue to our hotels; part of our system contribution to
revenue (explained on page 25).
The principal risks associated with Preferred brands and Reputation
and brand protection are set out on pages 36 and 37.
Case study – IHG Voice
IHG Voice is a premium pay-for-performance solution available
to all of our hotels for managing local telephone reservations.
The solution transfers reservation enquires made to a specific
hotel to experienced sales operatives with expert local and
regional knowledge, located in a number of core locations in
each region.
The specially trained sales agents use the proven reservation
booking methods of our award-winning central reservations
offices, ensuring that guests are able to make the right booking
for their needs and for any given occasion. It also maximises
cross-sell opportunities. If a particular hotel is unable to meet a
guest’s needs then the guest is provided with alternate suitable
IHG hotel suggestions. The service therefore maximises guest
bookings to the IHG System, delivering incremental revenue
to the hotel with improved average daily rate and RevPAR,
whilst providing a superior booking experience for the guest.
The IHG Voice reservations solution means that hotels can
concentrate on focusing their attention on providing a great
guest service and experience for those staying at their hotel.
By driving operational efficiencies and using technology in
this way, the service also allows IHG to drive a low cost of sale
without compromising the quality of the channel.
IHG® Rewards Club is the world’s first and largest hotel loyalty
programme, with 77.4 million members globally. It offers
industry-leading benefits and increased opportunity for points
redemption across our portfolio. As part of the relaunch,
IHG Rewards Club offered enhanced benefits for members
including free internet access across all hotels globally.
IHG Rewards Club has been named Best Hotel Rewards
Program in the World for eight years running by Global Traveler
magazine and Program of the Year by the Freddie Awards for
the Middle East and Asia/Oceania for 2013
24 IHG Annual Report and Form 20-F 2013
TARGETED PORTFOLIO DISCIPLINED EXECUTIONWINNING MODEL