Another day, another Holiday Inn opening. Today it’s in China, as the brand launches its 60th Chinese hotel near the city of Baishan to commemorate its 60th anniversary. Richard Solomons, CEO of InterContinental Hotels Group, which owns the Holiday Inn brand, says that the company is targeting around 20 lucrative markets at the moment, with China and India being chief among them. Those places are a long way from Memphis, Tennessee, where a businessman decided to open a motel in 1952 and name it after a 1940s Bing Crosby movie, Holiday Inn.
That businessman’s name was Kemmons Wilson, and he was frustrated by the poor lodging options he found on a family vacation to Washington, D.C. He opened a 120-room motel with an impressive suite of amenities: a swimming pool, free ice, a restaurant, and a well-lit sign to lure in customers. Then he did something that hadn’t been done before—he standardized the style of his motel and franchised it to other business owners, birthing the model for chain hotels that now populate every popular Interstate exit in America.
Today Holiday Inn is the biggest hotel chain in the world, with more than 400,000 rooms across its brands, according to Smith Travel Research. But before it was big enough to inspire a pop-culture catchphrase and a chart-topping rap song, Holiday Inn played a role in ushering in a new age of American travel and exploration.
“Holiday Inn was a company that really started in the heyday of postwar family tourism,” says Andrew Sandoval-Strausz, a history professor at the University of New Mexico. “What was particularly new in that period was that people were traveling with their entire families and they were often traveling on highways.”
Wilson’s idea to create a standardized hotel chain was more astute market timing than genius innovation. The post-war baby boom was producing a record number of nuclear families, while improved working conditions meant more workers could travel using paid vacation time. Hotels in cities were lavish and expensive, while motels in rural areas fluctuated wildly in quality. Holiday Inn, which offered consistently clean rooms and a pool for the kids, became an instant hit, with more than 100 of them popping up before 1960.
The concept really took off when the Interstate highway system made high-speed travel and longer vacations much easier. “Holiday Inn offered these travelers on the Interstate a brand that they could trust, a certain quality level they could expect to be consistently implemented,” says Arturs Kalnins, a professor in Cornell University’s School of Hotel Administration. “It was very much an analogue to what McDonald’s was doing at the same time in fast food and was equally revolutionary in that way.”
With rooms initially offered at $4 to $6 a night, Holiday Inn played a role in the “democratization of travel,” Sandoval-Strausz says. “We forget that for literally hundreds of years, travel was only for really wealthy people. It was only landed aristocracy that could really go from place to place. As the wealth is more broadly shared through all sectors, regular folks have the option to travel.”
By the time company founder Wilson appeared on the cover of TIME in 1972, there were 1,400 Holiday Inns in the United States and the company boasted a computerized reservation system that was the “largest on-line civilian computer system in the world,” according to TIME. Like McDonald’s, the company grew at a breakneck speed in its first few decades.
Today’s Holiday Inn is very different from the one of Wilson’s era, when unmarried couples could not book rooms and clergymen were on call to provide spiritual counseling for guests. As the company evolved from a new, hot commodity into a legacy brand, its hotels aged and many grew outdated.
“As with any brand, you have to keep it fresh and relevant,” Solomons says. “We’d almost taken Holiday Inn a little for granted.”
In 2007 the company launched an ambitious $1 billion rebranding initiative, the largest ever undertaken by a hotel chain. It was a big gamble as the economy began to unravel and hotels across the board were forced to slash room prices to maintain occupancy rates. More than 1,200 underperforming hotels were removed from the Holiday Inn system, while over 1,500 new buildings were opened. All employees had to be retrained in being personable and responding to guests’ issues. A specific Holiday Inn scent was even developed. The goal was to regain what had made Holiday Inn successful in the first place—consistency.
“Having new product is often important, but obviously very important is removing the poor quality product,” Solomons says. “It was a big sea change in what the brand stood for.”
The investment paid off. Occupancy rates are on the rise, and Holiday Inn has led its sector in customer satisfaction for the last two years over competitors like Best Western, according to J.D. Power and Associates surveys. Before the rebranding, they were sixth, below the sector average.
“Holiday Inn really is the case study that many in the industry look to as the prototype for how you go about refreshing and restoring a brand to its former glory,” says Stuart Greif, a J.D. Power analyst. “They made steady and consistent improvement, and not just in one area but in every aspect of the hotel stay.”
Now the company is aiming squarely for emerging markets. A 1,200-room Holiday Inn, the largest in the world, opened earlier this year in the Macau region of China. Holiday Inn Expresses are currently popping up in India.
“They’ve just become an iconic brand,” Kalnins says. “They largely remain relevant by sticking to who they are and who they’ve always been.”