Beginning in 1962, The Island of Guam opened its doors to tourism when President Kennedy lifted travel restrictions to the Island. But it was in 1967 when Pan Am Airways paved the way by bringing passengers from Japan to visit. After rapid growth through the years, in 2007 the tourism industry in Guam had reached its maturity. While visitors to the Island have increased, the occupancy rate for hotels has dropped significantly. The tourism climate had left Regal Carnation Hotel with an opportunity to reinvent or reposition itself among their competitors in Guam. The Regal Carnation Hotel has many internal issues to overcome as poor customer service, poor management, and poor property upkeep.
Overview of Key Issues and Root Causes
Vacationers were upset with their hotel experience on the Island of Guam. A number of symptoms were described the reasons to point to poor customer service, bad management, and the property being poorly dated or maintained. It is apparently the owners are investors who are trying to maximize profits in a mature market. The low price strategy equated to low service experience. The Regal Carnation Hotel is classified as a three star property. The overall issue is declined occupancy rates in a mature tourism market. Summary of the Case Data
One of the first indications of the condition of the hotel was the customer reviews on the website were mixed. Some guests cancelled their reservations upon arrival while other suggested choosing another hotel. •
Reservations took three weeks to confirm and prepaid with no refunds. It was competitively priced against other hotels with beachfront. •
The website projected the hotel as more upscale then what it actually was. •
Transportation from the airport to the hotel was forgotten. The vacationers waited 45 minutes for a car. •
The actual lobby was dated and not the lobby shown on the website. •
The check in took 25 minutes with untrained staff.
The room was...
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