Marketing Strategy of the Hotel Ibis in Manchester - Business Plan Example

Programme Module Assignment Marketing Strategy - HOTEL IBIS MANCHESTER ON PRINCESS STREET MANCHESTER Number Marking Date Table of contents 1.0 Introduction 3 2.0 type of services 3 3.0 Objectives 3 4.0 Marketing mix 6 4.1 People 6 4.1.1 Employee motivation 8 4.1.2 Employees need to be appropriately skilled/ trained 8 4.1.3 Employees should be aware of all aspects of their role 9 4.1.4 Effective communication with customers/ positive attitude 9 4.2 Process 10 4.2.1 transportation of customers 10 4.2.2 Self-service machines 10 4.2.3 Discount/ offers available to loyal customers 11 4.3 Physical Evidence 11 4.3.1 Interior of the hotel in terms of structure/ decoration 12 4.3.2 Support areas, such as office areas/ Internet areas 13 4.3.3 online services to customers 13 5. Conclusion 14 6. References 14 bibliography 15 1.0 Introduction The use of marketing mix for improving performance in the services sector is explored in this report. Reference is made Ibis Hotel in Manchester. Three elements of marketing mix, i.e. people, process and physical evidence, are presented, as related to Ibis Hotel in Manchester. The marketing objectives related to the specific elements of marketing mix are analyzed so that it is decided whether the above firm will be able to stabilize its performance at high levels or not. 2.0 Type of Services The Hotel Ibis Manchester is located in Princess Street. The above hotel belongs in the economy hotel category, meaning that its prices are at low to average range. Based on its capacity, 126 rooms, the specific hotel can be classified as of medium size. The hotel offers to its guests comfortable accommodation along with access to basic support services, such as Internet and satellite TV (Ibis Hotel Manchester 2014, Organizational website). 3.0 Objectives The current performance of the hotel can be characterized as satisfactory; still, improvement would be made in various business practices. A series of objectives would be set on which the marketing mix of the business should be based: A. Improvement of customer services/ People element The current quality of the services provided to the customer is not satisfactory since failures have been reported in regard to hygiene issues. Customer feedback would be introduced in the firm, as a scheme, for monitoring the quality of the firm’s customer services regularly. B. Improvement of employee behaviour/ People element Employee behaviour in Ibis Manchester would be improved; even if customer complaints on this issue have not been stated clearly the rather low popularity of the hotel among the area’s budget hotels (Dodd 2008) should be addressed by emphasizing on employees’ behaviour and performance. Training and meetings with the managers would help employees in Ibis Hotel to develop a more welcoming attitude. C. Increase of employee performance/ People element In Ibis Hotel Manchester employee performance should be increased in regard to the following point: employees would become more competent in managing customers’ complaints. In this way, the hotel’s popularity in Manchester would be increased, a fact that would benefit the income of the business. The increase of employee performance could be achieved by introducing appropriate training sessions but also by emphasizing on employee motivation. The hotel’s existing rewarding schemes should be reviewed and updated so that employee motivation in Ibis is secured. D. Improvement of services provided to customers/ Process The review of the existing services provided to customers in Ibis Manchester proved that there is no availability of machines for supporting automated transactions. For example, there is no machine for buying products, such as coffee or snacks. Also, there is no machine for developing automated banking services. The credit card processor available in the reception of the hotel is not accessible all times while it is mainly used for supporting payments to the hotel and not for offering to customers 24/7 cash withdrawals. F. Improvement of the hotel’s interior, in regard to its structure and arrangement of facilities/ Physical Evidence Even if the interior of hotel Ibis in Manchester is well designed, still there are areas for improvement. In this way, the accessibility of customers to all the hotel’s facilities would be increased while points of high interest, such as Internet areas, would be highlighted. Figure 1 – Ibis Hotel Manchester, interior – Internet area – café area (source: Organizational website 2014) For example, in the two photos included in Figure 1 two important sites in the hotel’s ground floor are presented: Internet area and café area. As derived from the two photos the Internet area is located far from the café area, in such way that it is almost invisible from the guests sitting in the hotel’s café. Other changes in the hotel’s interior should be also promoted as explained in the sections that follow. 4.0 Marketing mix The marketing mix is a strategic framework that helps the firm to respond to the expectations of its customers; the specific framework constitutes certain parts/ categories depending on the customer services issues addressed each time (Baker 2012, p.598). In regard to the Services sector the elements of marketing mix are differentiated, compared to the marketing mix in its traditional form. Indeed, for the services sector the marketing mix has three, core, parts: People, Processes and Physical evidence (Payne and McDonald 2012, p.145). The Marketing Mix for Ibis Hotel Manchester is presented below. 4.1 People In the context of the marketing mix, the word ‘people’ is used for referring to employees and customers (Baker 2012, p.603). In the services sector employees have a critical role in customer satisfaction. For this reason, in this sector managers need to emphasize on the training of employees and the introduction of rules of employee behaviour, so that the quality of their firm’s customer services is at high levels (Baker 2012, p.603). As for customers, these individuals are likely to change views and preferences on products/ services rather easily (Henry 2011). Thus, if a business aims to secure customer loyalty it should emphasize on the effective management of customers’ requests and complaints (Henry 2011). In other words, in order for service quality to be secured in the services sector it is necessary for certain terms to be met: employees should be motivated and empowered, appropriate training schemes would exist for ensuring employees’ awareness of all the requirements of their role and the recruitment/ selection process should be carefully designed so that the individuals hired have positive attitude and welcoming behaviour, as needed in all sectors of the services industry. Figure 2 – Relationship between employee engagement, employee satisfaction, customer satisfaction and financial performance in the services sector (healthcare sector) (source: Peltier, Dahl and Mulhern, 2009, p.20) The relationship between employee satisfaction, employee empowerment and customer satisfaction is presented in the graph in Figure 2. According to the above graph, employee empowerment leads to employee satisfaction, a condition that leads to customer satisfaction. At the next level, the financial performance of a business in the services sector can be expected to be high. The element ‘People’ as part of marketing mix in Ibis Manchester is analyzed below. 4.1.1 Employee motivation/ empowerment Ibis hotel Manchester could secure its position in the local market only if it would be able to keep its employees motivated. Employee motivation is usually related to monetary rewards; however, often non-monetary rewards have equal power to keep employees motivated (Piercy 2009). For example, the chance to direct meetings or to submit proposals for improvement of business operations can be valued by an employee higher than a monetary reward that would be no followed by the increase of employee’s power within his organization. In other words, empowerment would be a necessary part of the firm’s strategy for increasing employee motivation. If being motivated employees are likely to be more interested in the positive outcome of the tasks assigned to them; also, the friendlier behaviour in the workplace and the increase of self-esteem are common signs of motivated employees (Piercy 2009). 4.1.2 Employees need to be appropriately skilled/ trained Employees in the services sector are vital for the business success. In fact, not appropriately skilled employees in this sector could destroy the brand name of their organization (Clark and Gordon 2014). However, in order to be effective a training programme needs to be aligned both with organizational culture and with employees’ characteristics, meaning not just their educational background but also, mainly, with their attitudes (Clark and Gordon 2014). If such approach is not used, then the training provided to employees would have no value. For example, it has been found that even after their participation in training programs employees tend to face problems in responding to quite complex processes (Baker 2012, p.605). This practice should be also used in Ibis Hotel Manchester. 4.1.3 Employees’ should be aware of all aspects of their role In order for employees to be able to respond to customer needs the following term should be met: employees should be fully informed on the rules of the business especially in regard to their role (Clark and Gordon 2014). Otherwise, they would be unable to respond to customers’ complaints but also to the customers’ requests in regard to the use of the hotel’s facilities. For example, the employees in the reception should be informed on the schedule of the hotel’s café or the terms of operation of the hotel’s Internet area. Moreover, employees would be able to support the customers effectively in case of emergencies or unexpected failures (Clark and Gordon 2014). For example, in case of lack of rooms for covering an emergent arrival an alternative would be available to customers, such as the accommodation, in a special price, to one of the brand’s other hotels nearby. 4.1.4 Effective communication with customers/ positive attitude Employees in the hotel industry need to have a positive attitude, meaning especially the potential to show to customers that are welcomed in the hotel; the latter would highly value such employee behaviour and would be expected to continue visit the particular hotel in the future. In addition, positive attitude can help in effective problem solving; if employees are quite polite and able to work under pressure with a sense of humour, then they could calm customers if unexpected problems would appear. 4.2 Process In the hotel industry process, as an element of marketing mix, can refer to various issues, such as: a) the means of transportation used for customers who want to reach the local airport or one of the bus/ train stations; b) the automated machines established within the hotel for covering various customers’ needs, such as the need for a drink or a snack, c) the methods of payment available to customers, d) the schemes available to loyal customers in regard to reservations, lower prices and so on. 4.2.1 Transportation of customers In the organizational website no reference is made to the transportation available to customers in regard to key travel points, such as airports and train stations. A transportation scheme of such type should be added in the services of the hotel (Baker 2012) since a high percentage of guests are expected to arrive from other cities, or even from abroad. In regard to the financial implications of such service the following arrangement could be made: a fee could be introduced, low as of its value, for covering transportation needs of customers, as explained above. 4.2.2 Self-service machines When being in the hotel, the guests of the hotel may need to buy refreshments, water or other type of food without having the time to visit a shop nearby. The hotel would establish such machine for covering the particular need of customers. The fact that in most hotels such machines are available would be an important incentive for the hotel’s managers to take such initiative. At the same time the hotel could arrange with a bank to establish an automated cash machine (Baker 2012), either within or outside the hotel; such practice would further increase the hotel’s capability to cover the needs of its customers. 4.2.3 Discount/ offers available to loyal customers The guests of the hotel should be given incentives for visiting the hotel again in the future. Apart form the quality of services, the pricing strategy of the hotel should be also critical for ensuring customer loyalty (Baker 2012). For example, the hotel could introduce a loyalty-scheme in the context of which regular customers would be given special offers to rooms of all types in Ibis Hotel Manchester. Also, loyal customers could be possibly offered the chance to make a reservation at last minute or to pay for their stay gradually, i.e. such as in installments, either by the end of their stay or even later, through their credit card. 4.3 Physical Evidence The term ‘physical evidence’ reflects a key part of the marketing mix: the term denotes the objects that a firm uses in order to help its customers to use its services (Fifield 2007, p.243). Moreover, physical evidence can also include the material or the equipment used for furnishing a firm’s stores, so that the firm is made more attractive to its customers (Fifield 2007, p.243). According to Baker (2012) the firms in the services sector have to face the following problem: the quality of their services cannot be evaluated by customers before the services are offered (Baker 2012, p.605). Therefore, firms in the services sector have to emphasize on physical evidence, as part of their marketing mix, so that customers are convinced to buy the service, even if they have not tried the services of the particular firm in the past (Baker 2012, p.605). In this context, the value of physical evidence in regard to a firm’s position in the services sector is high. In the case of Ibis Hotel managers should take the above fact into consideration when developing the strategies required for the improvement of the firm’s physical evidence. At this point the following fact should be highlighted: the hotel industry in Manchester is highly competitive but its performance is not stabilized, as proved through the graph in Figure 3. Figure 3 – Hotel industry in Manchester, performance by month from Jun to July of 2010 (source: Hotel News Now 2010). It is made clear that in order to secure its competitiveness in the hotel sector of Manchester Ibis Hotel should emphasize on its physical evidence, aiming to distinguish its features/ services from those of its competitors. 4.3.1 Interior of the hotel in terms of structure/ decoration As made clear through the images in Figure 1 the café of the hotel is near the reception, so that it is directly accessed by guests. However, the internet area is located in the opposite side of the reception, behind a wall, without being visible from those sitting in the café or from those entering the hotel (Figure 1). The structure of the hotels ground floor would be updated so that all facilities are visible (Baker 2012), a fact that would increase their functionality. At the same time, the chairs used in the café of the hotel should be replaced by more comfortable areas; in this way the café of the hotel would become an area for relax. This initiative is necessary since the hotel does not have a recreational/ entertainment area and would need to cover, as possible, the relevant gap. 4.3.2 Support areas, such as office areas/ Internet areas As explained earlier, the ground floor of the hotel has not many areas; apart from the reception, a café covers most of the ground floor. Furniture has been added in front of one of the ground floor’s walls for adding computers so that the needs of customers for Internet use are addressed. However, space should be retrieved for developing an office area; computers would be included in that area. In this way, the hotel could respond to the needs of its customers for office area; in this way also, the computers available to guests would become visible, as so far are placed behind a wall, as explained above. 4.3.3 Online services to customers The firm could update its website (Bamford and West 2010), so that customers are able to check online the status of rooms and of the other areas of the hotel. In its current condition, the website of the organization can be characterized as of average to low level: more categories should be incorporated and details would be added in regard to the hotel’s structure and the facilities available to guests. Also, by adding information on the surrounding area, or on Manchester in general, the level of the website’s visitors would be increased, a fact that would also increase the chances for online reservations. 5. Conclusion The use of an appropriate designed Marketing mix, as suggested above, could help Ibis Hotel in Manchester to significantly increase its image in the market, a fact that will enhance its performance. Indeed, by emphasizing on People, Processes and Physical Evidence, as analyzed above Ibis Hotel Manchester could improve its brand image attracting more customers. However, the hotel’s managers should take into consideration that the three elements of the marketing mix mentioned above are of equal importance: this means that the needs of each of these elements should be equally supported so that the competitiveness of the hotel is secured. 6. References Baker, M., 2012. The Marketing Book. 5th ed. London: Routledge. Bamford, C. and West, P., 2010. Strategic Management : value creation, sustaínability, and performance. Belmont: Cengage Learning. Clark, T. and Gordon, S., 2014. ‘Budget hotels: The lowdown on going low cost.’ Daily Mail. Available at http://www.dailymail.co.uk/travel/article-617180/Budget-hotels-The-lowdown-going-low-cost.html Dodd, G. (2008) “The Manchester Hotel Market and the UK Hotel Investment Market.” Jones Lang LaSalle Hotels. Available at http://www.jll.co.uk/united-kingdom/en-gb/documents/manchester_hotelmarket.pdf Fifield, P. (2007) Marketing Strategy, 3rd Edition, Oxford: Butterworth-Heinemann Ltd Henry, A., 2011. Understanding Strategic Management. Oxford: Oxford University Press. Hotel News Now (2010) “Market Report: Manchester, England.” Sep 21, 2010. Available at http://www.hotelnewsnow.com/Article/4045/Market-Report-Manchester-England Ibis Hotel Manchester (2014) Organizational website. Available at http://www.ibis.com/gb/hotel-3143-ibis-manchester-centre-princess-street/index.shtml Payne, A. and McDonald, M., 2012. Marketing Planning for Services. London: Routledge. Peltier, J., Dahl, A. and Mulhern, F. 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