Rosewood

Topics: Brand management, Brand, Net present value Pages: 9 (1279 words) Published: March 11, 2009
Rosewood Case

1. Make an overview of the pros and cons of the tow different branding strategies (i.e., individual branding and corporate branding)

1) Individual branding:

- Each hotel and resort featured architectural details, interiors and culinary concepts that reflected local character and culture and defined Rosewood’s ‘Sense of a Place’ (each of the properties seeks to capture what is unique about the given location).

- Some degree of flexibility and creativity

- Powerful tool to differentiate Rosewood Properties from competitors

- each property marketed itself under its own brand name in addition to

- individual brand can be very powerful

- participating in Rosewood-related advertising

- low awareness of the corporate brand

- brand-wide usage among guests and was an untapped asset

- customers are not making the connection between the corporate brand and the individual brand

- difficult to position a collection of properties in an increasingly crowded field of luxury operators

- it limits their market

- people do not tend to visit other properties of the same corporate brand

2) Corporate branding:

- status symbol

- global data warehouse

- higher cross-property usage

- less connected to the individual aspect of the hotels

- resistance of local managers to adopt the corporate brand

- fear of managers to lose their autonomy

- stimulate multi property guest stays and increased effectiveness of frequent-stay programs

- increased marketing costs because then they also have to promote the corporate brand

- need to ensure a perfect product/service performance consistent across all properties

- co-op owners don’t immediately see being part of a corporate brand as something positive, they prefer a stronger individual brand

2. The guest retention rate

Guest retention rate = number of repeat guests / total number of guests

1) Individual branding:

- Number of repeat guests: 19.169

- Number of unique guests: 115.000

- Number of multi property guests: 0.05*115.000 = 5.750

- Guest retention rate: (19.169)/(115.000) = 16,67%

2) Corporate branding:

- Number of unique guests: 115.000

- Number of multi property guests: 115.000*0.10 = 11.500

- Number of repeat guests: 11.500 – 5750 +19.169 = 24.919 (this is because the multi property guest stays have doubled)

- Guest retention rate: (24.919)/(115.000) = 21.67%

3. Customer lifetime value

a) Customer revenue drivers

1) Individual branding

i. Number of nights they stay = 2

ii. Multi property guest stays = 5%

iii. Number of times they return = 1,2

iv. Customer revenues = 750 (grows with 6%/year)

v. Acquiring costs = 150 (only once)

vi. Marketing costs = 130 (grows with 3% /year)

2) Corporate branding

i. Number of nights they stay = 2

ii. Multi property guest stays = 10%

iii. Number of times they return = 1,3

iv. Customer revenues = 750 (grows with 6%/year)

v. Acquiring costs = 150 (only once)

vi. Marketing costs = 130 (grows with 3% / year)

vii. Additional marketing costs = 8,69 (grows with 3%/year)

b) Customer Lifetime Value

|Data |Individual branding |Corporate branding |Explanation | |Unique guests |115000 |115000...
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