Marketing Analysis of Five Asia Hotel - Case Study Example

Marketing Analytical Paper Executive Summary Five Asia hotel has been there for the past six years and has recently started experiencing low revenues with decreasing market share. The marketing plan analyses the situational position of the company and brings in analysis of company, customer, competitors, climate and SWOT. The SWOT analysis expound on the benefits that the company will obtain if it incorporates the analysis of SWOT. The hotel is planning to increase the customer base from the current 15% to 40% within the year in terms of quarterly basis timescale. The strategy brings in some parts of 7Ps marketing mix which ensures that the objectives and goals of the company are achieved. There are many hurdles that the hotel has to jump to see there improvement from the 15% to 40% market share. There is a great level of competition, but the hotel has derived communication means through the local newspaper, radio and television in wooing the customers. The budget that has been developed accounts to all issues that may arise and the organization management has promised assistance where there is a need. Furthermore, the implementation timescale has been drawn that splits the year into four parts with each part requires to accomplish certain task. Contents Table 1.0 Situational Analysis………………………………………………………………….…4 1.1 Company Analysis………………………………………………………….…..4 1.2 Customer Analysis…………………………………………………….…….….5 1.3 Competitors Analysis……………………………………………………….…..5 1.4 Climate Analysis……………………………………………………………......7 1.5 SWOT Analysis………………………………………………………………...7 2. 0 Marketing Objectives……………………………………………………………….….8 3.0 Hotel Market…………………………………………………………………………....8 4.0 Market Segmentation…………………………………………………………………...9 5.0 Target market…………………………………………………………………………...9 6.0 Marketing Strategy Employed………………………………………………………….10 6.1 Advertising……………………………………………………………………..10 6.1.1 Choose Advertisement Room………………………………………...11 6.1.2 Choose advertisement Food and Beverage………………………...…11 6.2 Pricing Strategy……………………………………………………………..….12 6.3 Product………………………………………………………………….……...12 6.4 Customer Feedback……………………………………………………………12 7.0 Budget…………………………………………………………………………………13 8.0 Conclusion…………………………………………………………………………….14 9.0 Works Cited……………………………………………………………………………15 1.0 Situational Analysis The Five Asia hotel has employed the three basic steps that are used to analyze and identify the market needs and the position them with the product that will ensure that the targeted market segment is achieved. This is a six year old hotel that currently faces competition and other problems that are depicted to be out of context. Hence, to understand the problems and difficulties that is faced by the hotel analysis in terms of hotel situation, competitors, customer, climate and SWOT analysis. 1.1 Company Analysis The main aim of the hotel is to increases the number of customers that they receive. The facilities and services that are offered in the hotel include foods and beverages and hotel accommodation in which there are 200 rooms. The rooms are grouped in the form of luxuries and benefits that are associated e.g. single, double and presidential suite. Additionally, there are cottages and form a good place for all level of classes of people. Currently, 20% of the accommodation services are booked on weekdays while on the weekend 30% of the rooms are booked. Moreover, the food and beverage sector tends to bring more revenue. The hotel is located in an area where the population is high and there are people from different professional income earners which dictate the type of luxury that they should be accorded. The market is a population that accounts to 60% of the middle earners with 25% low earners while 5% accounts to higher income earners. This is a unique marketing scenario because the product is not taken to the customers but the customers are supposed to come to the products and services. Moreover, the internal environment is ready in participating in the marketing success. The budget, marketing team and the internal departments is flexible and are ready to ensure that the strategy succeeds (Baker 89). The weakness that the hotel is exposed to is the issue of workers. The hotel lacks enough work forces that could assist in the marketing of the product. Furthermore, the hotel has poor reputation because of previous services. The key market where the business is coming from is those people who participates in businesses e.g. conferences and local people who wants some break from their day to day activities. The hotel has to maximize the middle income earners who double ups as the middle class earners. 1.2 Customer Analysis Through a research that was carried out showed that the people who visited hotel accounted to 15% of the entire population. This population comes from those people who visit the hotel because of business and leisure activities. These are professional people who range between the middle and low income range earners which accounts to 85% of the population. 1.3 Competitors Analysis Competition in such service is usually very high, because the segment is big, hence creates an opportunity for lot of businesses to create a segment in the market. Therefore, it is an important aspect in understanding the marketing strategy that is employed by the competitor. This means that Five Asia hotel has to develop a strategy that is different or better than the one from the competitors. After analyzing the market, the research showed that there are three main competitors who are: The Serena Hotel – this is a hotel which is ranked as three stars properties that have the same facilities such as the ones that are provided by the Five Asia. The hotel is in good standard because it is still new and refurbishment is carried out through out the year ensuring that it is of good standard. Hence, its image is likely to jeopardize Five Asia in terms of customer base (Clammer 34). The hotel is estimated to have a share market of 10% which is the lowest in the hospitality industry. The Paradise Hotel – This is the biggest threat to the Five Asia hotel. Hence, in most cases may be referred as the twin of the Five Asia hotel. The research indicate that the hotel has many things that are the same as the Five Asia hotel ranging from pricing of the room, the target markets and services and facilities that are offered. Moreover, the hotel rooms are of good quality which is likely to beat the room quality of the Five Asia hotel. However, the Paradise hotel has overlooked food and beverage sector which can be maximized by the Five Asia hotel (Cohen 78). This hotel controls 25% of the market share with specialty in accommodation part. Sun & Sand Hotel – This is the best hotel by the terms of customers and other agencies. It is five star hotel with exceptionally facilities that above the standards of most hotels in the area. The hotel most targets the middle and upper income earners, tourists and other large scale hotel activities. Even though the facilities and services that are offered by the hotel are exceptionally, they are expensive which gives the Five Asia hotel whose facilities were cheaper (Melton 56). This is threat to the entire hospitality and mostly the hotel industry. The hotel takes 40% of the market share with specialization on both food & beverage and accommodation. 1.4 Climate Analysis The method that was employed in analyzing the macro environment was the PEST analysis (Bramble 34). This enable the hotel to understands and put into considerations the legal and political requirements such as procedures and licenses that are required. The targeted market and the general environment has be analyzed and found that when the right strategy is employed there is a likely chance that more customers will be attracted. Hence, the social and cultural environment has the capacity to accept new services and facilities. 1.5 SWOT Analysis Additionally, the SWOT analysis was employed in defining the internal and external nature of the company. In this case, the strengths of the company are the availability of funding (budget) the quality of services and facilities that are in place. Moreover, the prices that are offered both in terms of rooms and food are cheap which will act as bait to the customers. However, the weakness that the hotel should check and is easily solvable is the lack of enough workers. Expertise and qualification of the marketing team is questionable while the previous poor reputation destabilizes the operability of the hotel plan. Moreover, there are opportunities that can be maximized by the hotel. Collaborations with other sectors such as tourist agencies ensure that more customers are received. Thus the presentation of the hotel to the outside world will ensure that the hotel is exposed to more customers hence the likely chance that more customers will visit the hotel. The Sun & Sand and the Paradise hotel are the biggest threats in terms of the competitors. For example the Paradise hotel is sometimes referred as the twin hotel to Five Asia. Such comparison may make customers to visit the Paradise hotel. Sun & Sand hotel has exceptionally services which will siphon the customers away. 2. 0 Marketing Objectives The aim of the marketing is to increase the number of customers who visit the hotel and consequently increase the revenues and profits. Additionally, the hotel is trying to improve the bad reputation that is associated with the hotel currently. The strategy should take three phases over one year which will later form the basis of references for the next three years. The year is divided into quarterly parts. In the first portion of the phase, revenue should be 10% and market share of 15%, the second phase should increase the amount of revenue by 25% and the market share to increase to 23%. The third phase will have to increase the amount of revenue to more than 35% with market share of 33%. The last phase ensures that the market share and revenue is about 40% increase since the start of the campaign. 3.0 Hotel Market The location of the market doubles up as a tourist attraction centre. In this location tourist usually visits in the dairy event which is the third quarter. Moreover, the number of dairy events determines the number of tourists that visit at a time. Additionally, at this time the local market becomes the broader market which incorporates the dairy event hosts, local who comes for the exhibition and the people who bring the dairies. Consequently, there is the unique market which is the holidays such as the Christmas which is in the fourth quarter of the marketing plan. There are also the conferencing, seminars and corporate out which contributes to the market. Therefore, the hotel is somehow behind in attracting the market because the strategies that were developed before not suitable. Furthermore, the is the inconsistency of the hotel in terms of pricing which makes the hotel to loose more customers. 4.0 Market Segmentation The common demographic on the week day base (Monday - Friday) is consisted of those people whose ages range between 30 – 50 with professional management of middle and lower class. During the weekends the same demographic visit the place but with their family included. Hence, the age limit has shown that the age range of the market indicates the potential customer being baby boomer generation. Hence the general market is divided into two major segments which double up as the target markets: business and leisure. The segment numbers varies over quarterly basis in a year depending on the season and number of the dairy events in the year. 5.0 Target market There will be two specific segments markets which are the leisure and business markets Leisure – this is the market that constitutes the tourist and the local people who wants change of environment. This accounts to the total market because of the ability of any body visiting the hotel. Business segment – this is the segment that brings in the 60% of the market which is the business. The hotel is targeting conference, seminars and corporate hosting. Moreover, there are business people who come from other locations and require some place to stay and the hotel should be the first option. 6.0 Marketing Strategy Employed Five Asia hotel is located at a place where there is competition. Hence, the hotel developed a strong marketing strategy to gain the interest from the market. The hotel was able to acquire information concerning the market through information that is available from exited market researches, bench market competitors’ information and purchasing of relevant market research information. The hotel was able to combine the information that was received from these hotels in developing strategies. This resulted in developing the strategies which involved advertising and pricing = service = value of money. Hence the strategies were used to develop a market matrix that maximizes the strategies. In addition, the hotel is collaborating with hospitality industry agents, airline agents and other bodies that share the same industry. This will ensure that the agents will direct the customers from other locations to the hotel as the first option. 6.1 Promotion and advertising Advertising strategy was overlooked in the previous years because the hotel saw it as an expense. However, the research that was carried out showed that this is the main strategy that should be used to attract the target market and encourage them to visit the facility and spending their money in the business. Hence, the hotel develops a strategy to attract customers to the business. This resulted in the hotel developing the right advertisement strategy and choosing the right media to be used. Hence, the strategy developed the strategy around the product (food beverage & beverage and the room) and its effectiveness on the market segment. 6.1.1 Choose Advertisement Room The targeted market for the room sector is the business target. The effective media that was used to market this sector is the use of “Sunday Standard Newspaper” which has an average of 573,000 copies is sold weekly. The hotel has heavily advertised in on single and single weekend in the 1st, 2nd and the 4th quarter to enable communication with the target market at each quarter. Moreover, on the same media and the third quarter will enable the communication at each target market. The hotel has spend more of the budget in weekend and family weekday on the peak leisure season which is the third quarter using the same media. Furthermore, the hotel has invested in “Website” and “Local Visitors’ Guide”. This strategy enables the number of sales in terms of occupation of the rooms in the second and third year. 6.1.2 Choose advertisement Food and Beverage Food and beverage is another sector that generates revenue to the organization. This is the fundamental position that the Five Asia hotel is best suited to. This is the specialty business that the hotel and forms a potential differential between the competitors. Therefore, the food and beverage strategy is focusing on the in-house guest which is the dominant in the business customers’ community. The market further requires a flexible food provision and easy access to meals to suite the lifestyle of the customers. Hence, the hotel employs the point of sale so as to attract the mainly business in-house guest. Moreover, the “Local Newspaper” is used to attract the local community during the special events e.g. Christmas which enables the creation of other sub-segment in mostly the low business season period. Refurbishment of the hotel is improved so that the image of the hotel markets itself. The strategies increase the sale of food and beverage in the hotel which so far has contributed to a third of revenues. 6.2 Pricing Strategy Pricing is an important aspect in the Five Asia hotel. Before the pricing was inconsistent and usually confused the market. The pricing of the services and facilities should be stable through out the year. Therefore, the price of the Five Asia hotel is determined by level of service, product, cost of product and service (break even, and the return) and the target market behavior e.g. considering the price between the high and low season. The strategy is expected to increases the number of sales in the second year. Hence, the price strategy will enable the hotel to set bench mark in beverage sale. This gives the hotel the chance to increase the profits and earn extra profits. 6.3 Product The product that the hotel will be specializing in is the food & beverage and the accommodation or the room. The quality of service plus the quality of the food should be admirable. The rooms should be at its most organized completely with services such as TVs and external telephone. Variety and tastes of food should be provided in addition to the exotic beverages. 6.4 Customer Feedback A plan has been developed to receive customer feedbacks so that it can be used to improve the service and products. The feedbacks were analyzed and were used to improve the standards of the hotel. 7.0 Budget Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Totals Personnel (All transctions in US Dollars)                           Salaries 300 200 450 700 550 700 600 700 800 700 700 550 6950 Benefits       50 50 50 50 50 50 50 50 50 450 Taxes       7 5.5 7.7 6 7.7 8 7.7 7.7 5.5 62.8 Bonuses           13       19   30 62 Personal total 300 200 450 757 606 771 656 758 858 777 758 635.5 7524.8 Market Research                           Primary Research 90     90     90     90   90 450 Sec. Research 75     75     100           250 Total 165 0 0 165 0 0 190 0 0 90 0 90 700 Marketing Comm.                           Newspaper 60 60 60 60 50 50 50 50 50 50 50 50 640 Radio 80 80 80 80 60 60 60 60 60 60 60 60 800 Television 110 110 110 110 70 70 70 70 70 70 70 70 1000 Total 250 250 250 250 180 180 180 180 180 180 180 180 2440 Customer                           Loyalty       60     110     90   100 360 Lead Generation       20     100     100   100 320 Total 0 0 0 80 0 0 210 0 0 190 0 200 680 Channels                           Communication 90 50   20     80       80   320 Promotions   90           90     70   250 Commissions       70                 70 Totals 90 140 0 90 0 0 80 90 0 0 150 0 640 Other                           Postage 50 50 50 50 50 45 45 45 45 45 45 45 565 Travel 35 35 35 80 80 80 80 110 110 110 40 40 835 Telephone 50 50 50 50 50 50 50 50 50 50 50 50 600 Compuets 500       500               1000 Total 635 135 135 180 680 175 175 205 205 205 135 135 3000 Total Budget 1740 925 1285 2222 2016 1826 2091 1933 2043 2142 1923 1791 21937 Quartely Budget 3950 6064 6067 5856 21937 8.0 Conclusion Marketing is a delicate and flexible matter that should be addressed carefully. The service and products that are marketed should attract the customers. The hotel should maximize the information that is available from the SWOT analysis. The strategies that have been developed should ensure that the motive and objectives of the company is achieved. Moreover, the beverage and food sector usually in such scenarios increases the revenues and profits that the organization receives. 9.0 Works Cited Baker, F. Introduction to Hotel Management. New York: O’Reilly Publishers, 2006. Bindloss, M. “Introduction to hospitality policies.” American Behavioural Scientist, 51 (2008): 1867 – 1901 Bramble, T. “Another world is possible: A study of participants in Thailand”. Journal of Sociology 42 (2007): 287 – 309 Bramwell, B. Culture and Society in Hotel Industry. Jakarta: Prentice Hall of Jakarta, 2004. Clammer, P. “Public Service Broadcasting as an Infrastructure of Translation in the Age of Cultural Diversity: Lessons for Europe from SBS Australia.” Convergence 14 (2008): 323 - 333 Cohen, E & Aveli, N. “Food in Tourism: Attraction and Impediment”. Annals of Tourism Research, 31.4 (2004): 755 – 778. Cohen, E. Relevance of Tourism in Hotel Industry. Annals of tourism research, 34.3 (2006): 690 - 708. Cox, L. “Hotel Industry In Australia.” Thesis Eleven, 91 (2007): 148 – 152 Eberle, J. “An Analysis of Hotel Industry in Asian Countries”. Annals of Quantitative Research 17.9 (2007): 66 – 70. Hawthorne, F. Asian Countries and Hospitality Industry. New York: New York Publishers, 2007. Homan, R. Globalization and Hospitality Industry. London: Sage Publications, 2004. Homan, M. Hospitality Industry. Annals of tourism research 10.7 (2007): 60-67. Melton, W. Introduction to Hotel Administration. Singapore: Cambridge University Press, 2006. Smith, S. Impacts of Globalization to Asia. London: McMillan Publishers, 2007. Twain, K. Tourism in the Asian Countries. New York: Prentice Hall Publishers, 2007. Weaver, D & Lawton, L. Tourism Management in Hospital Industry. Milton, Queensland: John Wiley & Sons, 2006. Read More