Analysis of Marriott in the Context of the Hospitality Industry

Table of Content

The objective of this assignment gives us an in-depth analysis of Marriott and to better understand Marriott in the context of the hospitality industry in which they operate. Followed by analyzing the external environment issues faced using PESTLE analysis and the porter’s five forces model. And also looking into the internal environment analysis of Marriott through S. W. O. T analysis, TOWS matrix, Grand Strategy Matrix and lastly the product life cycle curve. 2. 0 Introduction Singapore Marriott Hotel 2. 1 Background of the Marriott is a global hospitality company operating more than 2,600 lodging facilities, primarily in the LLC.

S. , but also in 69 other countries and territories. The corporation has developed several brands in the mid to luxury sectors of the hotel industry, including The Ritz-Carlton in the luxury sector; Marriott Hotels and Resorts, and Renaissance Hotels and Resorts in the upscale sector; Courtyard by Marriott in the upper mid sector; and Fairfield Inn by Marriott in the mid-scale market. Extended stay properties, time-shares and golf finish the list of property types owned or operated by Marriott. The company had $12. Billion in revenue during 2007, earning a net profit of nearly $700 million through the efforts of approximately 1 51 ,OHO employees. That revenue held steady during the difficult economic conditions of 2008, at $12. 8 billion, with net profit declining to almost $400 million. The Marriott Hotel Singapore is located in the heart Of Orchard Road, next to Scoots Square and Lucky Plaza shopping complexes, and across the road from popular Wigwams Atria and Engel Ann City shopping complexes. The Marriott Cafe is popular for its international buffet meals while Crossroads Cafe is a favorite spot for watching people over drinks and a quick bite.

This essay could be plagiarized. Get your custom essay
“Dirty Pretty Things” Acts of Desperation: The State of Being Desperate
128 writers

ready to help you now

Get original paper

Without paying upfront

There is also elegant Cantonese cuisine at Wan Ha Chinese Restaurant, and trendy al fresco dining by the pool at Pool Grill. The hotel is two miles from the business district and the Singapore International Convention & Exhibition Centre. Closer to the hotel are Fort Canning one mile away, and Little India historical enclave one and a half miles away. . 1 Vision statement To become the leading provider and facilitator of value-based luxury, leisure and business experiences across the globe. Marriott committed to dynamic growth and service excellence built upon our heritage of traditional hospitality.

Marriott consistently meet and surpass guests’, employees’ and other stakeholders’ expectations. They feel pride in making effort to position Singapore in the forefront of the international arena. 3. 2 Mission statement To create an environment conducive and helpful to both our employees and customers, thereby encouraging our employees to work at their maximum opacity in being of service to our customers. 3. 3 Goals Marriott International has recently announced Its strategy for developing within the next 5 years in China.

As everybody knows, China is the largest market outside the United States, and Marriott International is betting everything on that fact. J. W. Marriott Jar. , chairman and chief executive officer of Marriott International is arguably the world’s most compelling tourism market today. Its buoyant tourism industry will host 2. 1 billion domestic and international tourists this year, an increase of 12 percent over 2009. He also said: M/thin the next 1 0 years, China is expected to be the world’s single largest source of international tourism and its number-one travel destination. 4. 0 External Environment Analysis 4. 1 The PESTLE Analysis 1 ) Political Factors: Marriott Hotels cannot discriminate when employing people based on sex, ethnicity, religion, orientation. The government supports tourism because it is a lucrative industry for the country. Marriott has to pay attention to physical and psychological working environment conditions since the Singapore government thoroughly regulates it. 2 ) Economic Factors:- In the short-term, they are affected by the economical crisis, so they should focus on giving an image of affordability.

In the long term, they have a very solid reputation so when the economy bounces back, they will be able to return to their original status which is a chain of luxury hotels. Cost of employment is high in Singapore so the Marriott would need a substantial profit to compensate. The above goes for high taxation in Singapore as well 3) Social Factors:- Green issues are very important in Singapore so the Marriott would have to focus on recycling not being wasteful and in general be as echo-friendly as Seibel.

Foreign population in Singapore is wealthy – spend on leisure, traveling and hotels 4) Technological Factors:- Marriott is defined by luxury therefore it should be up-to date with the latest technologies: Free, fast, accessible Wife. Functional and easy to use website. Paying bill on cellophane 5 ) Environmental Factors:- They have a buzzword-ECHO (Environmentally Conscious Hospitality Operators) is the name they’ve given to their green initiatives. Headquarters Initiatives: they’ve replaced plastic utensils with spaceward, given premium parking spaces to hybrid drivers, and made reusable mugs available.

This feels pretty week. The company has led a whole smörgåsbord of energy- and resource-saving initiatives, including: replacing 4,500 outdoor signs with LED displays, replacing 450,000 light-bulbs with CFML in 2006, saving 1 1-17 percent on their water usage through linen reuse programs, and installing 400,000 low-flow shower heads (which each save 10% on hot water use per year) 96% of Marriott hotels recycle in some form. Of course, there’s no quantification here, but it’s an area they say they’re working on. We’ll see.

Most impressively, Marriott is a member of the Pea’s Climate Leaders program, and they’ve omitted to reducing their energy use 6% per guest room in the period from 2005 to 2010. This is a modest but quantifiable step toward reducing energy use. 6) Legal Factor Legal issues apply to hospitality enterprises in a variety of operational areas from bookings to purchasing to human resources and a wide spectrum of other activities. The broad areas of legal exposure applying to the hospitality industry are contract law, liability exposure, obligations imposed on hospitality companies by specific legislation. . 2 Porter’s Five Forces Model 1. Threat of new Entrants : ( WEAK ) The competition in an industry will be the higher; the easier it is for other companies to enter this industry. In such a situation, new entrants could change major determinants of the market environment (e. G. Market shares, prices, customer loyalty) at any time. There is always a latent pressure for reaction and adjustment for existing players in this industry. Bargaining power of buyer : ( WEAK) This force reflects the strength of the bargaining position, particularly regarding price, which customers have over suppliers.

For example, tour operators, who book thousands of customers in to hotels, have a strong arraigning position and can demand lower prices from hotels. Customers have a weaker bargaining position if demand is high and capacity low, but when demand is variable and capacity high the customers have a stronger bargaining position. However, individual customers who book and consume hospitality products have limited or no bargaining power. Threat of Substitute products or services : ( STRONG) A threat from substitutes exists if there are alternative products or service with lower prices of better performance parameters for the same purpose.

They could potentially attract a significant proportion of market volume and once reduce the potential sales volume for existing players. The major substitutes for the hotel industry are camping and recreational vehicles for tourists, corporate guesthouses for business travelers and other informal means of accommodation with friends and family. The rapid development Of video-conferencing is a substitute product for the hotel meetings market. Compared to the hotel industry, these are much cheaper alternatives, making their price values very high and the switching costs very low. This makes the industry attractiveness in terms of substitutes.

Bargaining power of suppliers : (MEDIUM) The term ‘supplier’ comprises all sources for inputs that are needed in order to provide goods or services. The two key suppliers to the Hotel industry are labor and real estate. Over all the suppliers in this market are defined as property owners, developers and real estate companies, interior design and furnishings companies, architects, management and training service providers, marketing companies, industry consultants and CIT manufactures, Rivalry among existing firms : ( WEAK) This force describes the intensity of competition between existing companies in an industry.

High competitive pressure results in pressure on prices, margins, and hence, on profitability for every single company in the industry. There are a few large hotel chains that dominate the industry in Singapore. They have very strong brand names and identities and high stake in this industry which requires very high fixed costs. But Hotels also face excess capacity since one 69% of their rooms are occupied on an average. With moderate industry growth the overall attractiveness of industry in terms of competitors is low. 5. 0 Internal Environment 5. 1 The SOOT analysis and TOWS Matrix Strengths

Marriott Singapore location is just on top of the Orchard MR.. This would definitely give them an edge over the other hotels that are located in Orchard since the transportation of Singapore is mostly done by MR… Compared to the other hotels the delay between order and delivery is very less, which would eventually increase the quality of service. Marriott is very strong and established brand name all over the world. It has a base of loyal customers at local level as well as at international level. It has one of the biggest international booking structures.

Whatever the situation and scenario may e, corporate and government agencies always prefer Marriott hotel for their functions, seminars, and lodging their guest and customers. Marriott Guest Rewards program is the world’s largest and most preferred frequent guest program and is strength for customer retention. Weaknesses Limited room space may become a weakness for Marriott as it has only 393 rooms. Marriott needs to build more rooms. However, they are unable to do that because of their location constraints. This may become their weak area in future. Marriott does not directly approach new customers and only focus on the existing customers.

Opportunities There is a strong potential customer, those clients will be captured by good advertising strategy and effective distribution channel. In Singapore, tourism sector has been registering record highs of visitor arrivals and tourism receipts year after year. Accordingly, there are numerous potential customers for Marriott . Father more, as an important economic and trading hub with a base of over 5,000 multinational companies(Macs),Singapore is a natural venue for corporate meetings, Hence, there always have chances to attract corporate customers who are less sensitive about accommodation price.

The rats Competitors are one of the major threats that is faced by Marriott hotel Singapore. As we know Orchard road and its nearby premises are hosting the most number of 5-star hotels in Singapore, currently 22. It is very hard for Marriott to fight back from this amount of competitors. Some of these competitors are capable of decreasing the production costs massively and thereby decreasing the cost of the services. This could also pose a threat against Marriott hotel Singapore. Around three hotels are under construction around the same area. These hotels would be having innovative products and services.

Marriott should also have an approach in this area of innovation and creativity to attract more customers. 5. 2 Tows Matrix Analysis Internal factors External Environment Strength 1 Large expanse of brands 2 Global leader in hotels market 3 Excellent strategies to attract and retain employees 4 Geographic presence Weakness 1 Over dependence on luxury brands 2 FOCUS on US instead of international establishments 3 Marriott being targeted by fundamentalists or extremists 4 Lack of low-cost brands 1 Trend fro low-cost goods 2 Distinction amongst hotel service offered 3 Environmentally and family oriented

S-O Strategy 1 Acquire or establish hotel in Asia 2 Initiate budget and economic brands 3 Differentiation of a particular brand in certain locations W-O Strategy 1 Expand in Asia 2 Build high-end inns 3 Joint ventures in other high risk countries and use the local’s name The read 1 Boom of economy hotel brands 2 Increase of real estate in Asia 3 Terrorism S-T Strategy 1 Company wide restructuring to reduce cost and increase efficiency 2. Hire local employees by collaborating with local government units 3 Hire, train and support the localities where Marriott operates in to win the hearts and minds

W-T Strategy 1 Work towards expansions overseas due to economic meltdown 2 Use relationship with employees to temporarily reduce salary to be more competitive 3 Joint ventures with other companies especially in new ‘low cost’ businesses 5. 3 The Boston Consulting Growth (BCC) Boston Consultancy Group matrix is designed specifically to enhance a multi divisional firm s effort to formulate strategies to find out market share position and industry growth rate. BCC matrix was developed by Boston Consultancy Firm. DOG: Marriott Fitness Gym.

Fully-equipped fitness center features state-of-the-art articulators equipment. Fitness Gym at Marriott hotel have low market shares and decreasing cash flows. Star: Marriott hotel have total 393 guest rooms are equipped with a well-lit work desk, easy-to-reach cable points and in-room broadband high-speed Internet access, the perfect retreat for all business travelers. Marriott Deluxe room is experience rapid growth and best long-run opportunities for profitability Question Mark: As times become more hectic, more people than every before are willing to pay top dollar to get away from it all.

The so-called wellness revolution has even rise to a whole new kind of hospitality clientele, and has fueled staggering growth in the spa industry. Marriott hotel Retreat SPA menu Offers vanes of spa program that includes Body scrub, Facial treatments, foot bath, Manicures, Massages, steam room, and waxing. Marriott hotel Retreat SPA is in the introduction stage having negative cash flows but good growth potential. Cash cows: Marriott cafe renowned for its sumptuous all-day international buffets, this popular cafe adopts a cheery open-kitchen concept. Appetite’s and main courses are complemented by an equally tempting dessert selection.

An impressive a la carte menu is also available. Marriott cafe survive the maturity Stage and have a high relative market share position but compete in a low- growth industry. 5. 4 product Lift cycle (PL) The product life cycle presents a challenge to hotels to continuously assess their product effectiveness and performance in the market scene. Products or services used in the hotel facilities, leisure packages, business and family packages should all be assessed since their inception into the market by monitoring their growth, customer acceptance through the different stages in the cycle.

Cite this page

Analysis of Marriott in the Context of the Hospitality Industry. (2018, Mar 25). Retrieved from

Remember! This essay was written by a student

You can get a custom paper by one of our expert writers

Order custom paper Without paying upfront