Hospitality Distribution Channel Management Report: London Hotel

This report provides a comprehensive analysis of hospitality distribution channel management (HDCM) for the London Hotel. It begins with an introduction to HDCM and then proceeds to Task 1, which focuses on developing a distribution strategy to maximize profit, including target market identification (business travelers, tour groups), business mix considerations, and the use of direct (hotel website, social media) and indirect distribution channels (OTAs, GDS, wholesalers). The report discusses key factors for channel development and analyzes channel performance, including effectiveness, efficiency, productivity, equity, and profitability. Task 2 evaluates the negative parameters of emerging concerns (financial issues, limiting market exposure, cost, and budget) and provides feasible solutions. Task 3 offers recommendations for developing a profitable distribution channel, emphasizing the importance of website development, staying current with market trends, and building relationships with travel agencies to increase revenue. The report concludes with a summary of key findings and a list of references.

Hospitality
Distribution Channel
Management
(HDCM)

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1 ...........................................................................................................................................1
5.a. Prepare a distribution strategy for the London hotel which will focus on generating the
maximum profit for the new hotels. Also discuss about the target market and the business mix
along with the consideration of business objectives and profit expected from the new hotel. ...1
b. Explain about the distribution channels that can be used in promoting and increasing the
revenue of the new hotel..............................................................................................................2
c. Discuss about the key factors which are required for developing a specific distribution
channel.........................................................................................................................................2
d. Analyse the distribution channel performance in the critical manner along with the
implications on the London Hotel................................................................................................3
TASK2.............................................................................................................................................4
TASK3.............................................................................................................................................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Hospitality distribution channel management can be defined as the chain of
intermediaries that a hospitality services passes through some levels before it reaches to the
customer. These chains can be short such as a direct sale from the hospitality to the customer.
Hospitality distribution channel management is the practice of managing of each of these
distribution channels. In this report, a distribution strategy has been discussed along with some
important parameters. Also evaluate the key behavioural and emerging concerns that impact on
the proposed distribution strategy.(Lv and et.al., 2020) The focus is also on developing the
profitable channels to maximise revenue and to meet out the financial objectives of the London
hotel.
TASK 1
5.a. Prepare a distribution strategy for the London hotel which will focus on generating the
maximum profit for the new hotels. Also discuss about the target market and the business
mix along with the consideration of business objectives and profit expected from the new
hotel.
The direct distribution strategy in the hotel industry can be maximised through promoting
the business online with social media and also rooms can be sold out online through social media
platforms. Online booking channels can be used to increase sales and also ensure that the

booking engine and channel manager are mobile compatible. (Turker, D. and Ozdemir, G.,
2019)For generating the maximum profit for the new hotels it is important to focus on business
travellers, tour groups, small conference groups and individual tourists. Business mix are those
hotels which is a mix of both leisure and business guests. Facebook targeting option can be the
example of probably targeting the savvy business traveller with a relatively high travel budget.
The distribution strategy also include allocate more marketing budget during peak booking
seasons. Incentives and discounts can be provided for all the first time guests. Partnership can
also be build up with local and well known restaurants, shops or different institutes.
Making friends with local business owners is a great option to build partnership and helps in
promoting each other. The focus should also on promoting and market the location of the hotel
so that more people and the market share of your hotel can be increased.
b. Explain about the distribution channels that can be used in promoting and increasing the
revenue of the new hotel
A distribution strategy for the hotel is the planning of selling the hotel rooms in an
effective manner so that hotel can generate maximum revenue for itself. There can be mix of
direct and indirect channels. Direct channels include hotel's website and indirect channels
include online travel agents(OTAs), global distribution systems(GDS) and wholesalers. (Josephi
and et.al., 2016)For promoting the hotel, it is important that the particular website of the hotel
should be attractive and easily navigable so that travellers do not feel uncomfortable in accessing
your website. In this competitive world of online bookings customers have many options that's
why the website should be easy to use so that the customers can't switch over to another options.
Online travel agents or agency can play an important role in generating the revenue because they
sell travel related products or services to the customers which include hotels, flights, travel
packages etc. So they can help in promoting the hotel and can generate pool of customers for the
particular hotel. Global distribution systems can help in various ways for attracting more
customers. It increased access to travel agents for more bookings, it enhances for more efficient
booking process and also less expensive than marketing. (Xiang and et.al., 2015)Wholesalers

also help in promoting the London Hotel they had a vast networks of agencies and tour operators
at their disposal, so they can help in generating the decent profit through high-volume business.
c. Discuss about the key factors which are required for developing a specific distribution channel
The key factors which are involved in developing a specific distribution channel for
London Hotel it is important to focus on the current market trend. In today's time the whole
world has focused on digitalisation. For promoting and generating maximum profit everyone is
focusing on online platforms. So for the London Hotel, for reaching out among the maximum
customers it is important to use creative ideas via online measures. (Ţierean, O., 2018)Use social
media platforms like Facebook, Instagram, You tube etc. so that customers search about the
London Hotel in an effective manner and can also connect with everyone at global level. The
website should be easy to use, navigable and should be light in technical terms so that it does not
take time in loading the London Hotel website. For increasing and maintaining the image of
London Hotel, it is important to take care about its brand name so that every customer preference
become only the London Hotel. For sustaining in this competitive world, London Hotel has to
always come up with its unique new ideas, offers and new techniques for the customers so that it
always stand out different in the market .
d. Analyse the distribution channel performance in the critical manner along with the
implications on the London Hotel
The performance of a distribution channel can be analysed across multiple dimensions.
There are some parameters which will be used are effectiveness, efficiency, productivity, equity
and profitability of the channel. For London Hotel, it is important to analyse the traffic on their
website that how many customers are visiting their web-site. If website is not attracting major
customers then it is not successful parameter for promoting its hotel. Because sometimes
customers are more focused on well known brand names, they hesitate in trying new services.
They have a doubt in their mind that whether they are cost-effective or not. (Jeon, H.J. and

Gleiberman, A., 2017)Online travel agencies sometimes does not give authentic information
about the particular hotel. When customers visit those hotels then they do not receive the
satisfactory services from them and they give negative feedback which will spread in the market
as in the critical manner. Global distribution system also help in accessing to the travel agents
but sometimes for increasing the number of bookings and making the money out of it they have
charged higher prices for the bookings as compared to the nominal prices. This will create a
negative point in the minds of customers. For making the implications on the London Hotel in
positive manner, it is important to analyse the every intermediary and small steps taken by the
hotel.
TASK2
6.Discuss and evaluate the negative parameters of emerging concern that will impact on the
distribution strategy for the new hotel along with their solutions
Key behavioural and
other emerging
concern
Opportunities for the
London Hotel
Challenges they offer to
London Hotel
Feasible solution
to emerging
concern
The emerging
concern as London
Hotel faces some
financial problems in
terms of introducing a
new distribution
channel. It will be in
the terms of cost
effectiveness.
The London Hotel
have the opportunity to
give new experiences
to their customers by
giving different
services as compared
to other hotels.
The London Hotel have
to face challenges
regarding the extra cost
which will be
implemented on the
operations part.
(Jenčková, J., 2015)
The London
Hotel have to
prepare a proper
budget so that the
things can be
implemented in
the decided
pattern
The London Hotel
has its new brand
image and by relying
They can give
exclusive discounts on
their first bookings ,
research about the
The Hotel have to
increase the budget for
the marketing area
because of the reason of
If extra cost
needs to be
implemented
then the Hotel

on their own direct
sales the hotel would
be limiting their
market exposure.
current market trend,
tastes and preferences
about the customers.
(Labanauskaitė and
et.al., 2020)
problems faced in
introducing a new
distribution channel
should have a
buffer system for
their budget.
TASK3
7. Give recommendations on developing a profitable distribution channel for maximising the
revenue of the London Hotel
For making the online distribution channel more profitable, it is important to take the
decision of choosing the website developer very wisely because once the initial payment and the
work has been done then it is very difficult to handle the situation. Then the further cost has been
implemented only on the maintaining and hosting the website relevantly.(Aluri and et.al., 2016)
It is also important to be always in the touch of latest trends and changes in the market trend.
Another measure which will help in generating the maximum revenue for the London Hotel are
travel agents or travel agency. If the London Hotel make good terms with travel agencies then it
will help in sending the pool of customers to their hotel because they specialise in selling the
travel-related products. In this way, with the mixture of traditional and modern approach a
profitable distribution channel can be developed.
CONCLUSION
Hospitality distribution channel management plays a very important role in hotel
industry. The distribution channel is the base of giving any final services to the customers.
(Kharitonova, A., 2019) If any problem has been occurred in the distribution channel then it will
also affect the image of the brand and also degraded the position of the hotel in the big market.
So it is important to take care about the every small step taken by the new entrants in the market.

REFERENCES
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sales, marketing, branding, and revenue management Boston Hospitality Review,6(3).
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