Situation Analysis for Hotel Hillock - Case Study Example

Table of Contents Table of Contents 1 A Situation Analysis for Hotel Hillock, Mount Abu Rajasthan, India 1 Abstract 2 Introduction 2 Hotel Overview 2 Aims of the Report 3 Assessment of the Business 4 The Need and Scope for a Marketing Plan 5 Concise Brand Details 7 Four Ps of Marketing Mix Strategy 8 External Environment Analysis 9 Customer Analysis 10 Competitor Analysis 11 SWOT Report 11 Conclusion 15 References: 16 A Situation Analysis for Hotel Hillock, Mount Abu Rajasthan, India Abstract The paper is a situation analysis on Hotel Hillock in Mount Abu, Rajasthan, India. The situation analysis will discuss the key issue of formulating a social media presence for the hotel and the means of increasing its internet visibility. The Internal environment analysis, within the paper, will be critically examined and an assessment of the hotel’s business capabilities discussed. Also will be highlighted the need and the scope for a marketing strategy to increase its bottom lines through multi-pronged and technologically savvy internet marketing plan. The concise brand details will be examined. The ‘4Ps’ marketing strategy will also be part of the focus. External environmental analysis, that pertains to the region will be a part of the study. Some ideas which can bring about more bookings and revenues will also be examined keeping in mind the Hotel Hillock’s customer base and main competitors. A SWOT analysis will be presented before the paper is concluded. Introduction Hotel Overview The Hillock Hotel is situated in the picturesque Aravali mountain range in the mythological city of Mount Abu in Rajasthan, India. Mount Abu happens to be the only hill station in Rajasthan and is blessed with a green environment unlike the other arid and desert regions of Rajasthan. The hotel is located in a lush, forested area of Mount Abu atop a hill but close to the market and the attractive Nakki Lake. Hotel Hillock is ranked as a 4 star enterprise (www.hotelsmountabu.net). The hotel has a room capacity of 40 rooms which comprise one suite, 3 terrace deluxe rooms, 15 deluxe double rooms, 12 standard double rooms and 9 small rooms (http://www.mountabuhotels.co.in). The infrastructure in the hotel supports a multi-cuisine restaurant- Mayur a coffee shop- Chit Chat, a bar- Surahi, a banquet and conference hall, a swimming pool, landscaped gardens, the hotel lobby is also landscaped like a garden with waterfalls and a handicrafts and souvenier shop. Room amenities include AC rooms with attached bathrooms with 24 hour hot and cold running water, 24 hour room service, television and cable, and telephone facilities with ISD/STD, laundry service Other optional facilities offered are travel desk, money changer, safety deposit box, doctor on call, car rental, horse riding and trekking options, picnics and parties organized, postal services, indoor games facilities like carom, table-tennis, badminton and safe car park and free accommodation for drivers. Aims of the Report This report aims to examine and recommend changes in marketing strategies including E-commerce that Hillock Hotel needs to incorporate in order to successfully attract more customers. The report will go into all aspects needed to boost business through an aggressive internet marketing policy. Internal Environment Analysis The Hillock hotel has a good infrastructure with rooms facing mountains or landscaped gardens. The swimming pool is an added attraction during summer months. The forty well appointed rooms are tastefully decorated in keeping with the rich Rajasthani traditional decor. The management has an experience of fifty years in the hotel industry and is well versed in the nuances of the trade. They have the ability to pick the right candidate and have an eye for detail. This has led to the Hotel having a loyal and competent staff; many have been with the establishment for years. The hotel has an elaborate cuisine which caters largely to vegetarian guests. The staff, including the manger and the restaurant staff, takes pains to provide personalized service like providing a birthday cake for a child’s birthday and dishes that keep in mind the sensibilitiesof the Jain community (reviews on www.tripadvisor.in) the staff is friendly and dedicated and available twenty four hours a day. Hilltop hotel enjoys a good brand name as it is listed on most sites that cater to tourism in Rajasthan and India like mountabuhotels.co.in, tripadvisor, hotelsmounabu.net, Indian hotels guide and lomanika.com, which has the biggest hotel data base in India. However the presence is just a name in a third party website and is one among many other similar hotels. The hotel needs to market why it is different from others. It also needs to review strategy to enhance customer loyalty. Hotel Hilltop needs to incorporate the latest marketing practices, particularly pertaining to use of social media and E-commerce. A coordinated internet based marketing strategy which makes optimum use of the medium is lacking. Assessment of the Business The tariff rates range from Indian rupees (INR) 3445-6900 (45 Indian rupees equal around USD1) on one website of Aamantran tours, Jaipur while tripadvisor classifies it as a 3.5 star hotel but has no tariff rates available. The website www.travel.oneindia.in offers ‘best packages’. The deluxe room package is advertised for 2 days and 1 night in one place and when you click on the deal it states two nights and three days on another page on the same site. The pricing for both is the same at INR 3,900- INR 17,500. This kind of discrepancy in tariff rates will drive clients away. The official website offers no tariff rates so online customers cannot confirm the tariff rates on the official site. This is a key drawback as most customers select hotels on the basis of tariff before they view facilities. So one has to call them up or e-mail them to make a booking. The online visitors are likely to shift their attention to a hotel that provides a clear tariff policy for instant booking. The tariff rates for the rooms in the hotel change according to the time of year you visit. High season attracts higher rates and off season lowest rates. These tariffs mentioned are only for the weekends on this site. What about the tariff for regular days? Is the hotel just interested in the weekend visitor or does it want full occupancy through out the year? For online reservation on the official website the customer is directed to a third party site which functions poorly. The mission statement is “a place where you feel at home away from home”. The statement and the fact that it caters to customers in the middle to high economic strata could be a good USP for the national traveler. It may not be successful in attracting the international traveler. The Hillock hotel needs to analyse figures and construct strategise to channelize to its hotel as many visitors as it can from among the “more than 3 million national and international visitors who visit Mount Abu annually” (http://www.mountabu.com/) The Hillock Hotel has not given adequate publicity to attract potential guests from its target group. Right now it seems to be inclined towards a family oriented hotel but the conference hall belies that. So this means that the hotel would like encourage the business-traveller as well. The location of the hotel is ideal for the eco-traveller and the leisure traveller as well. The Hillock Hotel needs to make these strengths its USP. The Need and Scope for a Marketing Plan The scope of this marketing plan is to formulate strategy to increase the internet presence of the hotel. For a management that has been in business for the past 50 years seem to have a very meagre internet presence as the Hotel Hillock has just about three back links. “The latest statistics show that 400 million people access the internet regularly in India. So the future of internet marketing is very bright.”(Pramod 2009) If the hotel wants to generate revenues and maintain a competitive presence then the first step in that direction would be to redesign its present website. To remain competitive and a step ahead of similar hotels in the area then it needs a more viral presence. This will be a new and an unproven area for the hotel and so it must employ the best experts. The money spent will show in the long time results. Online travel booking is now the norm rather than the exception as it features ease of use. Hotels are now being judged on their internet presence rather than the starred ranks. A prospective visitor who does not get the requisite information from the internet research will wander away to a hotel that provides better literature and customer reviews on its site. The third party option for booking and reservations gives the impression that the hotel is under-booked and demand for the hotel at the lower end. Hotels should be doing their own booking and reservations even if it means additional staff. It will be more cost effective and profitable than booking through third parties. The hotel website has no customer reviews, which amounts to poor advertising on the internet. The customer reviews are also on a third party site and this shows disinterest on the part of the Hillock Hotel to promote itself. ( Trip advisor reviews) Hillock hotel requires a multi pronged strategy that includes blogs, emails, unique articles, SEO optimization and of course its presence on the social media circuit, facebook, twitter, even if it is only to ‘like’. The Hotel will need to regularly update its status on what it is planning for special holidays, festivals like Diwali, Christmas, Teej, etc, which group or party is using the conference hall facilities, the banquet hall, who it has organized a picnic for. These updates help to generate a business presence as the prospective customer is easily influenced by the peer “talk.” (Hospitality e-Business Strategy 2008). The hotel needs to budget these into the advertisement expenditure. If possible it should incorporate e-mail marketing. Note the email addresses of the visitors and send them regular e-mails on what new programmes it is planning. This will ensure customer loyalty. The hotel needs to be able to rank high on search engines for Mount Abu Hotels. Concise Brand Details Talking on the ‘Democratic’ brand, Howard Fineman said in the Huffington Post that “according to B-school gurus a company must create and vigilantly protect a clear coherent message about itself if it wants to thrive”. The Hotel Hillock logo should incorporate the business ideology of the hotel namely that it caters to the needs of upper end customers just below the 5 star niche. While it is not a budget hotel it strives to provide 5 star amenities at a lesser cost to the discerning guest who wants value for money. Internal resources assessment and marketing capabilities statement The Hotel Hillock is geared to meet the requirements of the middle level and upper end tourist and also members of the business community. It has the wherewithal for holding business conferences and conventions while simultaneously hosting the family oriented leisure tourist. The hotel has the capability of providing good hospitality in a family environment. It has a dedicated and nimble footed staff which is responsive to specific customer needs of the guests. The hotel has resources that allow it to offer modern day comforts. It has a well equipped kitchen which is capable of dishing out a wide variety of cuisines both for the guests as well as for special occasions, such as weddings, business conferences, parties and picnics. The swimming pool, well laid gardens, bar, well appointed rooms, convention hall with audio/ visual facilities and spacious parking and a good location are assets that the hotel needs to portray in its bid to score over its competitors. According to trip Advisor the hillock hotel is ranked second in hotels that offer similar amenities. For the Hotel to gain number one position it needs innovative selling ideas, like offering concessions, offering room and meal packages, holding special functions on special occassions like Independence Day, Children’s Day, Republic Day and New Years Eve. Gazal nights and Dance Nights could be organized which will help to catapult it to the number one slot. The hotel needs to position itself in such a way that its marketing statements should highlight its strengths of being eco- friendly, providing a resort like atmosphere but offering all modern amenities at a reasonable price. To achieve this aim the hotel needs to constantly review and upgrade its marketing strategy to keep a step ahead of its competitors. Four Ps of Marketing Mix Strategy Product: Hotel Hillock is a stand alone venture with the management fully committed to its success. They are pioneers in the hotel industry in Mount Abu and enjoy a high reputation in the hill station. The Hotel has been operational since the last 50 years and is fully conversant with local conditions. The modern trend of preserving the environment is reflected in the environs of the hotel which is situated on a hill in the Aravali ranges. The wild life sanctuary which is well within reach of the hotel ensures a pollution free environment for all times to come. Pricing: the pricing strategy should keep in mind the cultural ethos of its clients, for example catering to the rich NRI segment from Gujarat would pay high dividends, evolving a pricing strategy which is right and suited to the varying tourist seasons is already in place but needs to be revamped regularly to ensure better returns. Lean period pricing strategies could be revisited to evolve a system where the hotel remains booked even if by a category of tourists a notch below the four star kind. Place: The forecast for growth in tourism for both domestic and international is very encouraging and is expected to grow at a rate of 10.2 percent compounded annually by 2015 (Anton 2011). Hotel Hillock must evolve strategies to attract more foreign tourists during the peak season while ensuring commensurate domestic bookings during the lean season. Due to its location advantage being very close to the country’s main tourists destinations, namely Raipur, Agra and New-Delhi it can draw tourists visiting these places to include Mount Abu in their itiniery. Due to its proximity to Ahmadabad in Gujarat, which has emerged as a major commercial and business center in the country, Hotel Hillock is ideally situated to accommodate the business clientele from Gujarat including a very large number of NRIs who still have their roots in the state. Since the world renowned Dilwara temples, which are compared to the Taj Mahal for their exquisite marble workmanship, are in Mount Abu the hotel should venture into religious tourism in a big way. Promotion: Hotel Hillock should promote itself as a family hotel which provides quality comforts, warm hospitality with modern facilities in an eco friendly setting. Outdoor activities like trekking, horse riding, jungle walks and picnics in scenic surroundings should be part of the promotional package. At the same time the business traveller must also be encouraged and corporations should be enticed to hold their meetings and seminars on the hotel premises. External Environment Analysis The macro-environment remains challenging. These are summarized category wise below. a) Political: The political environment in the state of Rajasthan, where the hotel is located is stable. However there hovers a potential threat of terror strikes, riots, political upheavals, natural disasters which could affect the tourism industry per se. Economic: The economic situation is vulnerable to high inflation which could affect margins. Rising oil prices and food inflation affect domestic tourist traffic. The recession in the USA and parts of Europe could have an adverse impact on international tourist inflows into the country and this needs to be factored in while formulating a marketing strategy. b) Legal: The hotel industry does not anticipate any major legal changes in the near future and the policy on liquor is expected to continue without major changes and amendments. However, while pursuing foreign tourists due care is to be taken in training the hotel staff in abiding by regulations pertaining to foreigners. Also safeguards should be instituted to ensure no terrorist infiltrate the hotel in the guise of foreign or domestic tourists. c) Socio cultural: Mount Abu is known for its mythological origins and the area has a scattering of various temples, a wild life sanctuary and scenic beauty is a compelling attraction. With the Indian economy looking up there is money to spare and tourism gets a shot in the arm. Being a hill station intense heat wave conditions are also likely to see an inflow of domestic tourists. The rich cultural heritage of the area is an attraction. d) Technological: Major technological advances particularly in the IT industry have made planning a holiday or trip, an internet marvel. The company needs to upgrade its systems so that it is fully geared to take advantage of the technical revolution as more and more people book their hotels from available online information. Customer Analysis The hotel must fine tune its marketing strategy by analyzing the changing profile of its customer base. It should ensure that the average foreign and domestic luxury travellers needs are well slotted. Middle level businessmen could also form a segment of the hotels clientele. This category of customers will prefer the luxuries without paying additional taxes that a premier hotel attracts. Up to date records should be maintained so that season wise analysis is available. Present trends point towards family holidays. The needs of the children are particularly looked into by providing indoor games like carom, table tennis which adds value. The present customer is always looking for value added services and the Hotel Hillock should be alive to these changing trends. Competitor Analysis The main competition Hotel Hillock has is from similar four star and deluxe hotels like Hilltone. The name is similar and presently Hilltone Hotel is in the number one position in Mount Abu. The advantage of location that Hilltone has over Hotel Hillock will need to be countered and marketing strategy should be planned accordingly. Other hotels in the same segment are Chacha Inn, Hotel Aradhana, Mount regency, Hotel Savera Palace, Hotel Sheraton. Being the only hill station in Rajasthan, Mount there is no shortage of visitors in Mount Abu. The Delwara temples and the Brahma Kumari Ashram also pull in religious traffic and foreign visitors. The fact that the government has put a ban since 2002 on construction means there is no scope for expansion and so the Hillock will have to continuously upgrade its facilities, look for innovative ways to attract the market if it wants to keep ahead of its competition. SWOT Report Strengths Experience: The hotel has successfully established a name for itself in the industry owing not only to its extravagant services for the guests but also through 50 years of experience in the tourism and hotel industry. They have successfully adapted the changing customer behavior and have given enough evidence to gain customer base in Mount Abu and also ensure sustainability. Location: The hotel is centrally located. It is within close proximity to the main market, bus stand and the famous Nakki Lake. It thus gives them an added advantage of providing services like doctor on call, cab facilities and arranging treks and excursions for guests. Diversified Customer Base: It has rooms with different rack rates that cater to different segments of customers. This is good from a marketing point of view since a number of four star services being offered at a reasonable price help build strong brand image among growing tourists. Added Facilities: The services being offered cater to different needs of different people. Thus, allowing them to gain what they want from their vacation like for a business personnel the hotel boasts of an exclusive conference hall and for a vacationer who is away from work over a weekend, the hotel has recreational activities to offer including arranging treks and excursions to neighboring places. Thus, every individual’s demands can be met making it a ‘complete package for all ages and income groups.’ Along with these, the facilities that make u feel at home away from home remain a part of the entire experience like Air Conditioner, Panoramic View from all Rooms: The hotel infrastructure ensures that rooms face mountains or landscaped gardens, giving the guests a good getaway from the busy city life. Weakness Limited number of Rooms and the ban on construction by the Rajasthan Government in Mount Abu will not allow for expansion. It is in close proximity to the main market but not in the main market. This leads to loss of many customers who come for a specific purpose to the city and not for a vacation (travelguru). Not all online booking sites show the price of the rooms and it is inconvenient for customers if they have to make any added effort to find the same. Opportunities Eco-free Zone: Mount Abu after having been declared an eco-free zone has grown enormously as a destination for tourists looking to spend time in peaceful and calm surroundings in the lap of nature. This decision has helped increase tourist population to Mount Abu, thus allowing the Hotel Industry to reap benefits all through the year. Mount Abu is becoming a site for educational tourism, with many students from Gujarat Salagaon Dam Scheme: The approval of the Salagaon Dam Scheme to overcome the problem of water shortage (Sharma AK, 2008). This has ensured that hotels do not hike prices as price hike leads to loss of customers and this has the cascading effect of temporary fall in brand image. However, with continuous water supply the price range will not fluctuate drastically, thus ensuring a regular flow of tourists. (DeshGujarat, 2010). Rising Income Level: Income of Indians is steadily rising, giving rise to gross domestic savings at high rates. This has led to increase in disposable income of people are ready to spend on leisure. Eco-tourism: Since the government is focusing largely on eco-tourism, it is a great opportunity for the hotel to enter into active use of eco-friendly techniques of working within the hotel. Example: Using organic food for the meals, using toxic free detergents to wash the linen and other cleaning purposes, this will help the hotel frame a new policy to market itself well and gain more customers. Threats Current Competitors: Hotel Hillock faces current competition from Hilltone Hotel, Cama Rajputana Resort, Palace Hotel and resorts like Ratan Villas. Ratan Villas is situated in the Mount Abu Wild Life Sanctuary, making it a more appropriate stay for guests with infrastructure including tents and cottages adds to the adventurous mood of the tourists, along with a chance of citing wild animals. The prices of rooms too do not differ significantly with price ranging between 3000-6000 for a standard room (travelguru). Such an experience is hard to beat since the facilities being offered at competing hotels do not coincide with the ones being offered at Hotel Hillock (cleartrip). The Good resorts like Club Mahindra, which have been set up in Mount Abu, are a steal and amenities offered by local hotels look basic in front of good branded resorts. Environmental Ministry Bottleneck: Even if the hotel has expansion plans in the near future, the possibility of the same remains bleak because of a draft submitted by the Environmental Ministry declaring Mount Abu an eco-free zone with a ban on construction of any nature in order to protect the environment. Potential Competitors: Hotels that received fewer stars on rating sites like clear trip and travel guru have chances of taking away customers from hotels that charge higher rates in the same segment of 4 Star. Another factor is the emergence of guest houses as a substitute to hotels. (Gour Kanjilal) Infrastucture to support waste management is lacking and this problem could cause problems. Opportunities Mount Abu after having been declared an eco- free zone has grown enormously as a destination for tourists looking to spend time in peaceful and calm surroundings in the lap of nature. This decision has helped increase tourist population to Mount Abu, thus allowing the Hotel Industry to reap benefits all through the year. Mount Abu is becoming a site for educational tourism, with many students from Gujarat The approval of the Salagaon Dam Scheme to overcome the problem of water shortage (Sharma AK, 2008). This has ensured that hotels do not hike prices as price hike leads to loss of customers and this has the cascading effect of temporary fall in brand image. However, with continuous water supply the price range will not fluctuate drastically, thus ensuring a regular flow of tourists. (DeshGujarat, 2010). Rising Income level: Income of Indians is steadily rising, giving rise to gross domestic savings at high rates. This has led to increase in disposable income of people are ready to spend on leisure. Since the government is focusing largely on eco – tourism, it is a great opportunity for the hotel to enter into active use of eco-friendly techniques of working within the hotel. Example: Using organic food for the meals, using toxic free detergents to wash the linen and other cleaning purposes, this will help the hotel frame a new policy to market itself well and gain more customers. Conclusion Strategies and trends have changed tremendously with technological advancement. The implementation of a fully conversant internet strategy will be beneficial in drawing in the new customer and retaining the older one. Innovative services that more than fulfill customer aspirations need to be studied if the hotel is to excel over its competitors. If the challenge is taken in its stride then the new direction will see an increase in business. If the projections of the SWOT Report are taken into consideration then the future for Hotel Hillock will certainly reach new levels. References: Aamantran Tours (2008-2011) Premium Hotel Directory Website of Mount Abu [Online]2008-2011. Available on http://www.hotelsmountabu.net/hotelhillock_mountabu.htm Accessed [ 22nd August 2011] Agarwal D (2008-2010) Mount Abu The Mythological Beauty [0nline] available on http://www.mountabu.com/ accessed [22 August 2011) Anton (2011) Hillton Hotel Case Study On Situation Analysis,[Online] 19th march 2011. Available on http://essays24.com/print/Hilton-Hotels-Case-Study-One/37285.html Accessed [22nd August 2011] Deshgujarat 2010 Water Woes Avoid Visiting Mount Abu this Summer 20th April 2010 [Online] available at http://deshgujarat.com/2010/04/20/water-woes- avoid-visiting-mount-abu-this-summer/ Accessed [22nd August 2011] Gour Kanjila (n.d) Tourism S.W.O.T Analysis India [0nline] available at http://www.gourkanjilal.com/tourism-s-w-o-t-analysis-india/hotel-industry-in-india.htm, Accessed [22nd August 2011] India’s Biggest Online Booking Database, http://www.lomanika.com/rajasthan/mount-abu/hotels/four-star/hotel_hillock.htm, Accessed [22nd August 2011] Mehra SP and Sharma S, (n.d) Mount Abu: An Introduction [online] Available on http://www.abusms.com/sms/abu/index.htm Accessed [22nd August 2011] Mount Abu Hotels [online] http://www.travelguru.com/india-hotels/mount-abu-hotels.html Pramod (2009) Scope Of Internet Marketing In India 12th May 2009 [online] Applelounge: Internet Marketing Services Available at http://www.internetmarketingservicesco.com/internet-marketing-blog/scope-of-internet-marketing-in-india-2 Accessed [22nd August 2011] Sharma AK 2008 Salgaon Dam Mount Abu’s Life Line Mount Abu News 19 the February 2008 [Online] available on http://www.mountabu.com/news/node?page=1 accessed [22 August 2011] TripAdvisor.com, http://www.tripadvisor.in/Hotel_Review-g679012-d1181942-Reviews-Hillock-Mount_Abu_Rajasthan.html, Accessed [22nd August 2011] Mount Abu: The Mythological Beauty [0nline], http://www.mountabu.com/, Accessed [22nd August 2011] Read More