Professor’s Name: Dr. D. Wadden
Class Name: BUSI 2231 05 Applied Marketing
Date: Wednesday, February 12, 2014
Hilton HHonor Worldwide Case Analysis Paper
Defining the issues
There is increased level of competition within Hotel industry and this has made the cost of operation an important aspect in management. Sales and marketing department needs to register and identify market development programs and various demands from customers. There are issues surrounding dynamic pricing which assist in luring business travelers hence increase in customer loyalty. Various Hotels within the industry such as Sheraton has adopted optimal pricing as one of the key elements required for key operation of their businesses. Most of the issues surround loyalty-marketing programs that applicable as core channels of attracting and retaining best customers. There is also an issue concerning standardization of operations within hotel chains and the size of market within which Hilton competed. The effort to deliver to individuals, groups and organizations is possible through secure and knowledgeable workforce capable of identifying and satisfying consumer needs within different segments. Hilton has invested in a consumer behaviour research that has enabled the organization to obtain extensive data on consumer spending patterns. Consequently, they have improved on their responses and decision-making processes for the purposes of ensuring relevance within hotel and hospitality industry.
The brand name Hilton controlled by two corporations, Hilton Hotels Corporation (HHC) and strong positioning within the upper and medium scale hotel range identify Hilton International (HIC). The brand’s presence in all the continents is recognizable through Hilton HHonors program. Well-developed and established network with four tiers of membership (Blue, Silver, Gold, and Diamond) within the program utilized for purposes of attracting and retaining customers is an added strength (Deighton and Shoemaker 4). Weaknesses
Some of their weaknesses include consumer discrimination where on those on loyalty programs are granted priority in hotel bookings. Opportunities
Opportunities lie in the fact that the company can utilize their customer handling service through online booking. There is enough evidence to prove that unlike most other major competitors there is room for building and promoting current credentials and reputation based on high quality services amongst high-end consumers. In addition, various reports indicate that hotel industry sector is very saturated market within Europe, with most hotels having established chains reaching higher percentage of the population. Threats
Threats within Hotel industry include rising costs on labour and marketing programs within global markets. There is also stiff competition from potential high-class hotels within the industry.
Analyzing the case data
Hilton initiated various programs such as Hilton HHonors, designed for purposes of building loyalty to Hilton brand within the global market. The program has a brand name, Hilton HHonors Worldwide (HHW), with focus on providing high standard services to both HHC and HIC. The program involved registered members earning redeemable points per stay at HHC or HIC hotels. In the Hotel industry, increased market share translates to increased revenue that usually converts to higher profit margin. However, instead of an increase, there are experiences of low profitability levels since pricing is no longer a key to differentiating factor in this industry given that most hotels operate on decreased costs. For instance, Starwood Hotels and Resorts raised the costs through implementation of an aggressive frequent-guest program. Such program raised the costs of loyalty programs and operations costs. This means that Hilton Hotels have to strategize on cost effectiveness and ways of differentiating themselves from...
Please join StudyMode to read the full document