Mr. Smith, the owner of Sweet Dreams Motel in Far North Queensland, has owned the property for four years. However, he is unhappy with its occupancy rate of 50% throughout the year compared to other properties that can achieve a rate of 68%. Mr. Smith believes that his motel has various strengths including its location, expansive grounds, affordable rates, and spacious rooms.
Despite being aware of some weaknesses in the property, such as the lack of television units in the bedrooms, unattractive grounds, few promoting activities, and no restaurant services on site, there are still some positive external factors that could help increase the occupancy rate. For instance, installing entertainment units in the rooms, improving the landscape to make it more appealing, and potentially raising the room rates are all options to consider.
This case study aims to provide an overview of the current status of Sweet Dream motel in the market. It will summarize the products, competition, and distribution analysis in challenging market opportunities. In addition, it will briefly outline the internal strengths and weaknesses compared to external threats and opportunities for Sweet Dreams motel.
The situational analysis will delve into the background of this case study, driven by a need to understand how to make improvements for Sweet Dreams motel in Far North Queensland. The ultimate goal is to achieve a higher occupancy rate and ensure stable growth in the future.
This study examines ways to improve performance, as well as internal and external factors that influence SOOT analysis, market objectives, target market, and marketing mix. It also includes a current market analysis, overview of competitors and distribution process. Additionally, the study reviews how feedback will be measured to ensure successful implementation of the marketing strategy.
The Sweet Dreams Motel is a budget-friendly accommodation located in popular tourist regions in Far North Queensland. In the area, there are similar motel facilities and some upscale hotels. The motel is conveniently situated near the beach, shops, takeaways, restaurants, and other attractions. However, the surrounding scenery is not considered very attractive. Similarly, the premises itself are not particularly appealing; it is simply a large grassy area.
The property consists of 40 units and currently maintains a 50% occupancy rate year-round. Some loyal customers stay at the motel during every holiday period. Sweet Dreams provides rooms with tea-making facilities and offers breakfast for an additional charge. The motel rooms lack certain amenities such as TV, internet/Wi-Fi, microwave, bathtubs (only showers are available), room options, and kitchenettes. Local statistics reveal that other properties in the area have an average occupancy rate of 68% and the average length of stay is 3 nights. Mr. Smith has observed a significant increase in visitors from overseas as well as local families and couples. He advertises in local tourist guides and holiday newspapers but rarely attends meetings of the local tourist committee due to his busy management duties.
2. 3 SOOT Analysts
The table below provides a summary of strengths and weaknesses (internal factors) and opportunities and threats (external factors) for Sweet Dreams motel.
A.
Internal factors Strengths (s) I Weaknesses (w) I Located in a high traffic resort town I Lack of features: no TV, no Internet/Wi-If I Near the beach and main attractions I Low tenancy rate I Close to good restaurants and takeaways I Empty and unappealing grounds I Very affordable price, only half from similar competitors I Fail to sell on the spot because some people drive in and have a look but then leave Big rooms (able to accommodate family) I No restaurant service in the premises I Large and open sites I The motel name is not attractive I
Although there are many available rooms, the lack of advertising and focus solely on the local area is a drawback. The premises are well-maintained, but there is no strong connection between the owner and the local tourist committee. Breakfast service is provided. Additionally, there is not a solid relationship with nearby shops, restaurants, and takeaways near the hotels. However, loyal customers have been established as a result of good relationships. The low rate may create an impression of subpar quality. Regarding external factors, there are opportunities to enhance and make the grounds more appealing; however, failure could occur if occupancy does not increase.
Establishing the TV connection, finding a similar product in the market with better price and premises, and establishing internet connections. In addition, considering the downturn in the economy that can affect holiday expenditure, outdoor features such as BBC and picnic area, kids swimming pool, and mini golf (if not too costly) can be added. It is also suggested to increase room rates and build a marketing network with local and international partners. Overall, by utilizing their strengths to take advantage of these opportunities, the business can achieve better results.
Sweet Dreams will be evaluated based on their location, good relationship with repeat customers, and price points. They have potential to enhance their facilities, conduct research among repeat customers to make necessary improvements, and if feasible, increase the price to align with consumer perception since their prices are currently below market value. However, they struggle with low occupancy rates, lack of advertising efforts, and unattractive premises.
Sweet Dreams needs to be careful when implementing new improvements because they are facing competition in the market, a struggling economy, and the possibility of low occupancy in the future. The marketing objectives for Sweet Dreams motel are to increase the occupancy rate from 50% to 80% within one year.
To improve the attractiveness of the premises and capture people’s attention, the plan is to develop the landscapes and add new facilities. The goal is for 50% of visitors to make an immediate booking. In terms of advertising, it is recommended to expand beyond the local area and partner with international and online booking agencies such as WTFO.com, goad.mom, legitimate.com.au, booking.com, and expedite.com. Currently, finding information about the motel is challenging for travelers from other states or countries due to limited local advertising. Additionally, a coffee shop will be established on-site in the next year to provide guests with beverages, ice cream, and light lunches while also generating extra revenue. Finally, renaming the motel as Motor Inn is proposed.
In order to cater to the future emphasis on domestic tourists who travel by car, we suggest launching a name that highlights the vast open spaces. To effectively market and fulfill the recreational needs of different target markets, we recommend Mr. Smith focuses on three specific groups. The initial group consists of families from nearby areas, which is especially significant due to the proximity of Far North Queensland region to various mining towns in Central Queensland.
Residents of mining towns are known for being the highest earners in the region and are keen to discover enjoyable destinations for spending quality time with loved ones or having a brief retreat. The limited offerings in their local area, due to its proximity to the mine site, prompt this desire. As there is less traffic in Far North Queensland, families with children can conveniently hop into their cars and drive to the North region instead of enduring lengthy trips to Brisbane or opting for a plane journey for a short escape to Sydney or Melbourne.
The grey nomads, defined as individuals aged 55 or older who travel with various types of recreational vehicles such as motorhomes, caravans, camper trailers, and tents, embody a sense of adventure, humor, and camaraderie (Wisped). They represent the demographic trends of Australia’s aging population (Rig, 2011, p. 46). I am of the opinion that these grey nomads have made significant economic contributions to regional tourism in Queensland.
According to statistics, Queensland welcomed 4.5 million mature age visitors from different parts of Australia in 2009, which was a two percent increase compared to the previous year. These visitors constitute approximately 70 percent of the overnight leisure market in Queensland. The grey nomads play a significant role in the commercial camping and caravan park industry in Queensland. It is predicted that by 2021, there will be 9 million Australians above the age of 50, and tourism forecasts suggest that senior travelers will continue to contribute to the revenue industry as the baby boomer generation begins retiring.
The increase in budget travelers has led to a need for affordable lodging options that meet certain criteria: reasonable quality, safety, cleanliness, and good value. Typically, these travelers look for accommodations in the center of a town or city or near popular sites and attractions. Although some budget travelers may be drawn to remote and scenic areas for a unique tourist experience, they are unlikely to visit such places unless there is public transportation available and adequate promotion.
According to Mr. Smith, there is a constant demand for affordable family accommodation within the luxurious and beautiful area. I share this belief, especially considering the current strength of the Australian currency, which may prompt many international tourists to modify their holiday plans instead of postponing them. Additionally, I suggest including fruit-picking workers from nearby regions in this target market group.
5. Marketing Mix
5.1 Marketing mix for family travelers from local areas.
The strongest selling point of Sweet Dreams motel is its location in Far North Queensland, which is widely recognized as one of the top holiday destinations in Queensland. Sweet Dreams motels can attract family travelers by offering spacious rooms and the ability to cater to their needs. The affordable rates at Sweet Dreams make price less of a concern. Moreover, loyal customers who frequent the motel every holiday period are a testament to its quality, as they are choosing to return for reasons beyond just the price.
Customer loyalty is not maintained when there are inconsistent levels of satisfaction with each purchase (Rig, 2011, p. 325). In order to attract people to stay on the premises, Mr. Smith should consider making some improvements. Creating a small playground, as well as installing TVs and microwaves in the rooms, is necessary. Additionally, setting up internet connectivity is strongly advised so that while the rest of the family explores the area, the father can still connect to his office and check for updates.
The message we want to convey is that Sweet Dreams motel has prioritized the safety and enjoyment of children. We recommend advertising through local television networks, women’s magazines, and women’s websites. A common practice I have noticed in regional areas is using fridge magnets as promotional items. Sweet Dreams motel can distribute these magnets in potential target market areas by placing them in mailboxes or offering them for free in hair salons, nail salons, malls, boutiques, cafes, restaurants, and home appliances shops.
Additionally, when targeting the grey nomad market (with or without caravans), it is important to consider their specific needs. Based on my experience visiting tourism areas in Queensland, the older population is a potential target market for the tourism industry. Grey nomads are looking for safe and affordable accommodation after long hours of driving. They also value socializing with the community and having time to explore their surroundings. Many already have their caravans equipped with everything they need, so they are seeking basic accommodations.
If guests feel welcome and enjoy local attractions, they are more likely to spend extra time at the property. The main consideration for this group is price, and they also value certain facilities such as banking services, car repair, and good quality food options like restaurants or cafes to break the monotony of camp-style meals. Price promotions like “book two nights, get one free” will appeal to this group. They require a large parking space and appreciate quick and easy booking, as well as a warm greeting from the owner or reception.
There is a challenge and opportunity with this type of traveler because they communicate with the same group in the community. If they are satisfied with what they receive from Sweet Dreams, word of mouth will spread throughout the community. This can be the most cost-effective promotion tool we can rely on. As the demand for recreational vehicle tourism will also come from overseas, especially China in the future, it is recommended to include RCA tourism information on the Sweet Dreams website in languages such as Mandarin, Japanese, German, Italian, and French. 5. Marketing mix for budget travelers Budget travel does not mean traveling with as little money as possible. Instead, it means prioritizing spending, getting the best value for money, and creating the best travel experiences (Burnham, 2009, [online] Available at https://www.budgettraveladventures.com/travesties/budgetary/what-is-budget-travel/). Traveling is not just for wealthy individuals; budget travelers prioritize customer value. They typically plan ahead and conduct some internet research about their next vacation destination.
Having an online presence is essential for Sweet Dreams motel. Budget-conscious travelers are always looking for affordable options, such as discounted rates, meal coupons, free entry tickets to tourist attractions, or even an extra night stay bundled with malls and cinemas. It is crucial for the staff to have extensive knowledge about the motel’s features, history, local attractions, activities, and events in order to effectively communicate this information to the target market.
When creating the motel’s website, it is important to include informative content that appeals to budget travelers. This should include details about public transportation options to and from the motel, as well as the availability of free Wi-Fi on-site. Providing information about affordable local takeout options, popular shopping destinations, and where to find the best deals on souvenirs would also be helpful. In addition, feedback and evaluation should be a part of Sweet Dreams motel’s marketing process. Regular monitoring and assessment of marketing plans will assist management in better preparation and setting more realistic goals for the future.
