The Major Players in the Swiss and UK Luxury Industry - Case Study Example

The major players in the Swiss and UK Luxury Industry The major players in the Swiss and UK Luxury Industry Introduction The United Kingdom and Switzerland have a strong luxury hotel industry. AA ratings and a five star level characterize luxury hotels by established media brands such as Forbes (Harrison, 2014). The observation can be attributed to the strength of their national economies. The two countries have a large, wealthy class that is able and willing to pay for a five star hotel experience. In addition, the two countries are financial hubs in Europe. As a result, they have the ability of attracting many visitors. The business executives that travel into the country are keen on staying in luxurious hotels. A number of hotels have positioned themselves to take advantage of this strategic location. The paper has focused on four hotels with two from each country. The four hotels have attained a consistent five star rating in influential business and hospitality publications. The evaluation involves a focus on four significant business factors. The first area of focus is the size of the company. All the four hotels are large establishments that required a significant amount of financial investment in order to start operating. In addition, they involve a high cost of operation due to the infrastructure and logistics that is required to give a five star experience. Secondly, it has focused on their performance. The luxury hotel industry is characterized by a competitive industry that is fighting for a limited high-end clientele. Thirdly, there is a focus on the activities performed by the company. In this instance, it is evident that most luxurious hotels offer a similar experience. However, a few differences can be attributed to their unique locations and product offerings. Fourthly, the scope of the company is also analyzed. The term refers to the range of services that the organization has focused on. Luxurious hotels have multiple products that are suited for their wide clientele. The feature is influenced by the realization that different clients have individual needs. The luxury hotel industry enjoys an estimated valuation of €127 billion (Brass, 2013). The four hotels listed here are competing for a slice of the lucrative high-end industry. Furthermore, the target market is set to increase as the number of billionaires rises to 4,076 by 2022 (Brass, 2012). Hotels in Switzerland Switzerland has many luxurious hotels that cater for the needs of international tourists. The people who visit Switzerland are motivated by two factors. First, they may visit for personal reasons often accompanied by their family members. Second, they may visit the country due to official reasons. The country hosts many international conferences. In addition, it has a beautiful environment and snow that lure visitors to the country. Furthermore, most luxury hotels are located at a strategic location that exposes the visitors to the Swiss Alps and Lake Geneva. The natural beauty is a significant selling point for hotels in the country. Although the country has 5,243 registered hotels, a few players dominate the luxury market segment (Howarth HTL, 2014). The country has the highest purchasing power in the world (The Luxury Society, 2012). As a result, the hotels in the country have a ready market. 1 Le Richmond The Armleder family formed the hotel in 1875 (Dorchester Collection, 2014). The hotel has earned the status as a destination of peerless comfort and elegance. In addition, its personalized services have served to increase its competitiveness as a preferred hotel for visitors that are looking for a luxurious hotel experience in the city. 1.1 Size of the company The Le Richmond hotel is an iconic building that has characterized the Geneva cityscape for a long period. In addition, it is located in the heart of Geneva. The prime location means that it is located a short distance from its financial and shopping district. The hotel has 109 rooms that are characterized by an attempt to mix modern design and classical accents. The guest rooms have the deluxe bedding, sofa beds, marble bathrooms and high-speed internet. Moreover, its location next to the Lake Geneva, Brunswick Gardens, the Swiss Alps and the city give it a significant source of competitive advantage. 1.2 Performance of the company The Le Richmond hotel is the oldest hospitality institution in the country. The Dorchester group acquired the hotel in 2011. The group was given management responsibilities by the Cedar Capital management group. Furthermore, the hotel has one of the most expensive hotel suites in the world (Bisky, 2011). The Armleder suite commands a high fee but still manages to attract consistent clients. The estimated market share based on the visitors is more than 10% of the luxury industry. The hotel industry considers the ability to attract guests to expensive rooms as a feature of good financial performance. In addition, despite its regular change of ownership the hotel has managed to post consistent profitable performance. Currently, the hotel is under third party management (Hotel News Resource, 2012). 1.3 Activities performed by the company The hotel has a fitness center. In addition, it has a full service spa, Turkish steam baths, sauna, and private parking facilities. The hotel dining is offered by the Sapori restaurant. The restaurant serves Italian cuisine in a beautiful setting. The hotel has sufficient capacity to cater for the needs of about 200 guests every single time (Kabelitz, 2014). The hotel is well positioned to host conferences and international meetings. The restaurant Le Jardin offers refined Mediterranean cuisine. The Le Bar has positioned itself as an ideal meeting place for visitors in the area. The Le Spa offers relaxation and fitness facilities. In addition, modern TechnoGym equipment caters for the needs of clients who like exercising. Consequently, Le Richmond hotel can be characterized as a fully integrated service hotel that is committed to catering for all the needs of its clientele. 1.4 Scope of the company Le Richmond has an international clientele that are attracted by its beautiful scenery and urban setting. Furthermore, the hotel gets many famous visitors from around the world (Le Richmond, 2014). Consequently, it can be categorized as an international hotel. 2. Hotel D’Angleterre The Hotel D’Angleterre is a lakefront boutique hotel that has served the wealthiest people in society since 1872 (Ellis, 2014). The hotel markets itself as an ideal choice for the business and leisure travelers that frequent the city due to its proximity to key attractions. The hotel is close to the Swiss Alps, Lake Geneva, and the shopping and business areas of the city. 2.1 Size of the company The hotel is relatively small as compared to the rest of the hotels analyzed here. The luxurious hotel has 45 individually decorated guest rooms (Ellis, 2014). The guest rooms reflect the different needs of its clientele. The city has rooms that are decorated with the unique taste of its clients in mind. In addition, it has multiple services to cater for their needs. The hotel can be said to be a small boutique enterprise that caters for a niche market. The focus on a select market ensures that the organization benefits from specialization. However, it also limits its profit margins due to the focus on a small market segment. 2.2 Performance of the company The small size of the client limits the ability of the organization to generate many revenues. It is estimated that its market share is less than 5% of the market. However, its wealthy clientele ensures that the organization enjoys considerable profit margins. The hotel charges high hotel fees in order to offer quality services that clients expect in a profitable manner. In addition, its limited size ensures that the management only needs to hire a few individuals. As a result, it is able to limit its operational expenses. The luxury hotel industry respects the ability of the organization to attract the wealthiest members of the society. 2.3 Activities performed by the company The room amenities involve luxurious furniture, high-speed internet and original artwork. In addition, the hotel contains a fitness center, a sauna, and conference facilities concierge services. Furthermore, there is hotel dining that involves fashionable Windows Restaurant. The restaurant serves Swiss and International cuisine in an exquisite dining room that is characterized by a view of Lake Geneva and Mont Blanc. 2.4 Scope of the company The Hotel D’Angleterre caters for the wealthiest individuals in Switzerland and around the world. Consequently, it can be categorized as an international organization. The organization only caters for a select clientele. As a result, it is a small enterprise. Hotels in the United Kingdom The city of London has a many star hotels that are keen on taking advantage of its status as a regional hub. In addition, the city has a lot of cultural value due to the presence of Buckingham Palace. The Connaught Mayfair and the Dorchester hotel represent the luxurious hotel industry in the country. The hotel industry in the city benefits from the weak pound and its strategic location as a gateway into Europe (PwC, 2014). Furthermore, London enjoys a significant share of the global luxury hotel clients (The World Luxury Index, 2014). 3. The Connaught Mayfair Hotel The Connaught Mayfair Hotel has many advantages as a high-end hotel. In most instances, the success of a luxury hotel depends on its location. Hotels that are located in wealthy areas have a ready market for their services. The Mayfair area is one of the wealthiest places in London. The high-end nature of the environment is reflected in the high hotel fees charged by hotels in the area. 3.1 Size of the company The Connaught Mayfair is located in Mayfair, the Central London area. The area contains many commercial buildings for major embassies, corporate headquarters and hedge funds. The hotel is the most expensive hotel destination in the country with the costs going as high as 11, 700 Euros a night (Payne, 2014). 3.2 Performance of the company The hotel has a market share of over 15 % based on estimations. For example, the Mayfair hotel has posted a consistent and robust performance in spite of the high hotel fees that it posts. For example, the hotel is always booked despite the fact that its prices can be as high as 11, 700 Euros a night. Furthermore, the organization is able to generate enough revenue to support its operations and generate a profit. In addition, the hotel is recognized within the industry as one of the most elegant settings in London (Connaught, 2014). 3.3 Activities performed by the company The Connaught Mayfair contains 123 rooms and suites with each of them containing a unique décor and style. The elegant interior design involves a deliberate attempt to ensure the hotel is not only beautiful but also contains an extraordinary ambiance. In addition, technology has been included in the hotel to ensure that the clients have a comfortable experience. For instance, each room has an iPod docking station, flat-screen televisions with international programming and wireless internet access. In the modern hotel economy, clients expect the provision of internet. The hotel provides additional amenities to their clients. For example, the chauffer-driven car is provided on request. In addition, it provides unpacking and packing services. Moreover, the hotel provides 24-hour concierge services. Furthermore, it provides complimentary shoeshine services upon request. There is laundry services offered twice a day. Additionally, it provides complimentary tea or coffee on arrival. The clients receive an afternoon treat from Butlers. The Mayfair hotel has two on-site restaurants and bars. The Helene Darroze at the Connaught and the Espelette provide authentic French cuisine from the star-rated Helene Darroze. The Connaught Bar and the Coburg Bar serve wine and cocktails in an exquisite environment. The Aman Spa in the Mayfair hotel contains full service spa treatments and a fitness center. 3.4 Scope of the company The Mayfair Hotel caters for the high-end clients who work or visit the Mayfair area. The hotel is situated in an expensive location that ensures that it attracts many customers. The hotel provides accommodation services to its clients. In addition, it provides a site for clients to enjoy a good lunch. Moreover, it has rooms that hotels can use for meetings. It has the infrastructure that enables it to serve international clients. Moreover, the embassies located in the area provide a steady supply of international clients. 4. The Dorchester Hotel The Dorchester hotel is an iconic London hotel. The high-end hotel caters for the needs of a select clientele. However, unlike the three other hotels, it has the capacity to cater for a large client base. Consequently, it has the capacity to generate the most revenue. However, its fees are not as high as the Mayfair Hotel and the Hotel D’Angleterre. 4.1 Size of the company The Dorchester hotel is one of the iconic hotels in London. The luxurious hotel is located next to Buckingham Palace and the Trafalgar Square. As a result, it enjoys a prime location that is visited by international tourists. In addition, its location next to the palace gives it an advantage over its competitors in attracting international visitors to the Palace. In addition, the five star hotels are big with 5 restaurants. As a result, it has the capacity of serving many clients. The organization has 250 rooms. As a result, it has enough capacity to host a large number of people at the same time. In addition, a large capacity gives it a competitive advantage. Furthermore, the hotel can host all the participants of a high-level international meeting. Consequently, it has the ability to compete in the lucrative market sector. 4.2 Performance of the company The Dorchester Hotel has posted strong performance on a consistent basis. The estimated market share is over 20% because the hotel is respected within the luxury hotel sector due to its ability to charge high prizes for guest rooms. In spite of the high fees charged by the hotel, it still manages to attract many visitors. Consequently, it is able to generate many revenues. In addition, its selective clientele are willing to pay a premium prize in order to receive high quality services. The management has managed to position the hotel as the best place for visitors to stay in. 4.3 Activities performed by the company The luxurious hotel offers many activities for its demanding clientele. First, it has a 24-hour fitness center that enables health conscious clients to exercise without leaving the hotel. Second, the hotels have a full service spa that ensures that the clients access all the necessary spa services that they need in order to be relaxed. In addition, it has many room amenities. For example, each room has a minibar and a safe. Moreover, they have complimentary iPod docking facilities and DVD players. The Dorchester hotel, like all the other hotels covered in this paper, has free and reliable wireless internet for its tech-savvy clientele. An evaluation of the services available in the hotel shows a deliberate attempt to extract as much value from the client as possible. The observation can be attributed to the availability of multiple services and facilities within the hotel. For example, there is a spa, a fitness center, a baby-sitting service and gift shops. In addition, there is a relentless focusing on anticipating and preparing to meet client needs. Success in the luxury hotel industry involves the ability to predict and prepare for any unique needs that a customer may have (Sherman, 2007). 4.4 Scope of the company The Dorchester hotel caters for other the domestic and global market. However, its high-end nature and unique location gives it the ability of competing at the global levels. Consequently, the organization can be labeled as an international organization. Conclusion The United Kingdom and Switzerland have a robust luxury hotel industry. The hotels charge an expensive price for their services. The high price reflects the need to ensure that they maintain their status as high-end hotel operations. In addition, it reflects the high cost of ensuring that hotel guests have a memorable experience. The high cost of operating a luxury hotel chain is passed on to the consumer. The strong performance posted by the four hotels demonstrates that Europe contains a wealthy population that is willing to spend a lot of money. However, an evaluation of the international luxury hotel industry demonstrates that it is a difficult industry to penetrate. The ability to succeed in the category involves the ability to invest a lot of money into the industry (Okonkwo, 2010). An evaluation of the four companies shows that high-end clients expect many complimentary services. Moreover, they expect that the hotel understands trends in society. For instance, they expect free and reliable internet services. In addition, they expect iPod docking stations for charging iPod. The observation can be attributed to the increasing adoption of computing devices in the society. The luxurious hotel industry is characterized by multiple product offerings. The sector involves both small and big hotels. The small hotels tend to cater for the wealthiest clientele who love their privacy. However, all the high-end clients expect and receive a high quality experience. Besides good food, the hotels that they frequent offer beautiful scenery for relaxation. Besides that, a lot of effort is put into ensuring that they receive the personalized attention (Timmerman &Yu, 2014). Although running a successful luxurious hotel involves a lot of investment, strong financial performance by the sector demonstrated that it is a worthwhile investment. Although all the four hotels enjoy a significant domestic presence, a lot of their revenue is dependent on international clients. As a result, they are forced to ensure that they invest in international marketing. Furthermore, they have to ensure that their standards live up to international expectations. Consequently, they have to incur a lot of expenses in order to attract and retain the clients. An evaluation of the performance posted by the four hotels demonstrates that the large investment is worth it. References Brass, K. (2013). Luxury Hotels: Luring the next Generation. 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