Service Quality - Banyan Tree Group

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Service Quality Group Project

1. What are the main factors that contributed to Banyan Tree’s success?

Great experience & expertise of founder

Extensive travel experiences, sharp observation and superior foresight of Ho Kwon Ping, founder of Banyan Tree, inspired him to bridge the price gap in the hotel industry.

Ho foresees that the 21st century will be followed by a greater Asian demand for the industry, therefore he created a brand that Asians will like, with a strong Asian culture, which will also attract the global consumers. (Mary Scoviak, 2007)

Ho attributes the success of the Banyan Tree Group, as opposed to other Asian brands, to his ability to understand Western consumer markets. While Ho’s upbringing has allowed him to straddle both East and West, this will not be key moving forward, he says. “The 21st century is really going to be the age of Asia – both India and China. The huge consumer markets are going to be Asian” (Insead 2003, para. 3)

Excellent choice of target segment

Banyan Tree targets the middle to high end consumers to make them settle for something that is not as highly priced and exclusive as a premium resort such as Aman but yet offers them the same benefits which will suit their purpose.

With the stressful and busy schedules that many couples face today, Banyan Tree’s resort provides an avenue for couples to relax, spend quality time together, as well as to build closer relationships.

This target segment is supported by S. Tamer Cavusgil director of Institute of International Business at the J. Mack Robinson College of Business at Georgia State University. He stated that managers should refer to the various market potential indicators and the most important to examine and monitor the middle class segment’s size and expansion. This is because the middle class segment contributes the most to the economy and they are the most active consumers. So in new markets or expanding markets, the middle class segment’s size and growth would be a good indicator of the market economy. (S. T. Cavusgil, 2008) In correlation to Hohol (1997), people that are very wealthy number about 80 million across Asia, those who can be labeled “middle class”, including professionals, are expected to number between 375 and 500 million by the year 2005 and those who are leaving their poverty behind and beginning to spend significantly on some modern durables are expected to number some 750 million. Hohol (1997) also added that within the first decade of the next century there will be over a billion Asian middle-class consumers which, according to him is “like having the equivalent of four to five US markets”. Unique brand positioning

Banyan Tree differentiated from its competitors by providing “sanctuary for senses” experience to customers which is not easy to replicate by its competitors.

Building resorts comprising individual villas, exotic in architectural design and positioned as a romantic, private and intimate escapade for guests was well thought out and valued by many couples. Such value proposition had yet to be adopted by any hotel or resort, thus Banyan Tree gained a competitive advantage by becoming the pioneer.

Strong brand recognition allows Banyan Tree to charge higher prices for their prestigious group of high end customers, especially targeting at couples with hectic work schedules and stressful lifestyle, who have the ability and are willing to pay more for greater enjoyment and relaxation.

Excellent customer service level adds value to the customer’s experience.

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Source: Cleartrip.com

Cleartrip.com has taken reviews from 142 customers of Banyan Tree and the ratings have proven that customers have been clearly satisfied with the service and amenities provided and most of the customers are there for their honeymoon.

Therefore, in order for Banyan Tree to differentiate from its competitors, establishing a unique brand positioning is very important....
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