Innovation Club Med

Topics: Risk, Club Med, Risk management Pages: 10 (3644 words) Published: May 22, 2013
Club Méditerranée

Club Méditerranée or Club Med, is an originally French corporation of vacation resorts found in more than 80 countries of the world. Its resorts do their job under the Valtur, Club Med, Club Med Affaires (developed for business travellers), and Club Aquarius. At the same time it operates two cruise liners: Club Med 1 sails the Pacific and Club Med 2 - Mediterranee and Caribbean’s clients.   Club Med’s history begins from 1930x, when Gerald Blitz, a Belgian athlete and fighter, decided to visit Olympique’s village based in Corsica. The tent impressed him that he made a decision to establish Club med as non-profit organization with a main purpose to popularize open air life and sport education. The goal population was oriented on youth and young adults. At that time the vacation was usually local and when people wanted to have a rest they just do picnics at the gardens or going to relatives for a while, where all families came together. But Club Med idea was to establish resorts in exotic locations, which was absolutely innovative for that time.    The innovation of Club Med combines three elements:

 - cash free system - where guests can buy extra services without taking cash all the time, just special card, which every guests receives after registration in the resort. - “all-inclusive” concept, which still doesn’t mean that everything is free on the resort territory, but basically such services like food and drinks, transportation and entertainment are free of charge. This innovation provides 20% guest return every year and 83% guest return every three years. Inside resorts of Club Med there are special nicknames for the staff - “GO” (Gentle Organizers) for the guests - “GM” (Gentle Members), and for the employees - GE (Gentle Employees).    Because of no competitors and loyal guests who wanted to make a prepayment for their vacation, Club Med scaled very fast. In 80x chain’s management decided to make resorts more comfortable and replaced village tends with bungalows and hotels. The new marketing strategy was adopted to make Club Med family-friendly profile and deep understanding of what their guests want to see and what they want to get from the resort.

In 1950, no matter for a long journey by bus, boat and train, the first Club Med resort welcomed guests and the hotel was full, even more to say, there was more than 10, 000 requests more but resort was able to accept only 2,300 guests at the same time.

  First and the most historically important innovation for the Club Med is “all-inclusive” idea.  Club Med is originally the first hotel chain who took a risk use such innovation like “all inclusive concept”. Basically, the innovation means that guest should make a prepayment for the vacation, but as soon as he arriving to the resort - he is offered unlimited food, drinks, some spa and sport activities, etc. Club Med created so-called “four pillars” capabilities: accommodation, food, transportation, sports and entertainment. Such pillars became identification of Club Med’s value opportunities, which were modified with new technologies: variation of transportation services was diluted with chartered boats, planes and trains, in food fishing and hunting were included, and numbers of sport facilities were extended. But still all inclusive doesn’t mean that everything is free, still some options and extras are not free of charge. With launching this innovation Club Med received “all-inclusive international vacation” profile. Other most remarkable innovations of Club Med:

- Cash has been replaced by cards. Guest doesn’t need taking their cash money every time when they want to buy extra services, but a card only. Club Med makes it more comfortable and free for members about buying cocktails or else. - To the free food and drinks Club Med includes wine.

- Club Med introduced its first ski resort
- Actors and writers started to create professional...

References: 1. Annual Financial Report, 2012
2. Club Med goes upscale,
3. Official website of Club Med
4. Case study, Club Med: The party is over,
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