Category: Hilton Hotels

Hilton Worldwide is one of the leading players in the hospitality and leisure industry. In order to analyze Hilton Worldwides performance within the industry, it is important to compare financial ratios against the companys past performance for the year of 2012, competitors performance, and the industrys averages.

Trend Analysis

The trend analysis allows comparing the firms performance over a certain period of time, while focusing on present and past liquidity, profitability, and efficiency ratios. Liquidity ratios, including current, quick, and cash ratios, are important to examine Hilton Worldwides capacity to pay debts. Hilton Worldwides current, quick, and cash ratios for 2014 can be discussed as decreased in comparison with the data for 2012. This fact points at the companys failures to improve the liquidity as the ability to address financial obligations (Table 1).

Table 1. Liquidity Ratios.

Referring to profitability ratios, it is possible to state that the situation for 2014 was positively changed in comparison with the data for 2012. Hilton Worldwide slightly improved its profitability after two fiscal years in terms of providing more services and generating more profits, as it is seen with references to increased Gross Margin and Operating Margin (Table 2). Thus, Hilton Worldwide became more profitable and efficient.

Table 2. Profitability Ratios.

Much attention should be paid to Total Assets Turnover as the efficiency ratio to measure the firms abilities to convert available assets to generate cash assets. Referring to the data for 2014, it is possible to state that Hilton Worldwides income significantly increased in 2014 in comparison with 2012, as it is observed with references to the Total Assets Turnover rates (Table 3).

Table 3. Efficiency Ratios.

Interfirm Comparison

To analyze Hilton Worldwides position within the industry, it is necessary to compare the ratios with the ratios typical for such two key competitors as Marriott International and Starwood. In relation to liquidity ratios, Hilton Worldwide is a leader in the industry, having the highest ability to repay short-term debts. However, the profitability ratios are lower than the ratios of Starwood. Efficiency ratios can be discussed as median (Table 4).

Table 4. Interfirm Comparison.

Comparison with Industry Standards

Depending on the data for 2014, it is possible to state that Hilton Worldwides ratios are higher than those ones typical for the industry. Furthermore, the firms liquidity capacity is inclined to increase (Table 5).

Table 5. Comparison with Industry Standards.

Comparison with standards or industry averages allows understanding the trends regarding the companys performance. Hilton Worldwide demonstrates improvements regarding the liquidity capacity, but the profitability ratios are lower than those characteristic for competitors.

Design

The Hilton Hotels & Resorts website is an informative online page that provides interesting details about services and options for clients. There are a number of attributes and features that capture my attention. First, the website contains a menu that helps website users to book a room in a hotel and order tickets in accordance with the established dates of staying at a hotel. Second, the users can immediately learn about the benefits of choosing the hotel services by clicking View Details link. Third, I was impressed with the website interface that demonstrates marvelous views of the hotel, changing every 10 seconds. Finally, it is also possible to conduct personal research on the questions that interest users, most of all.

Structure

The structure of the website is well organized for users to easily navigate across hyperlinks, tags, and folds. This is of particular concern to the ability of potential clients to learn more about services, as well as guidelines to reserve the room. Besides, there is no necessity to click on the find tabs to learn more about the information it can contain. Despite the disadvantages, there are some shortcomings of utilizing the website functions. Specifically, I have problems with finding a registration field and login details because of the small font of the text. In addition, the website prioritizes the find tabs that can allow the users to order services or learn more about the hotel. Such a tool is aimed at advertising rather than delivering useful information.

Content

While viewing specific information about hotel rooms and services, I have noticed that I can easily return to the main menu because all basic find tabs are still at my disposal. Although there are a number of links and tabs providing valuable information, it is still typed by small font, which makes it difficult for users to evaluate its importance. The hotel website contains the positioning of the main statement and brand of the hotel on each of the links that the user can find.

There is also much information about beneficial packages that Hilton managers can propose to their customers that range from room services to conference halls. Each type of package is clearly described and explained. In general, the site is oriented on the clients that plan to make use of the website services, as well as online services proposed on the spot. Finally, the website contains many pictures of the resort for users to have a better idea of the services.

Social Media

With regard to the recent trends in managing hotel business online, the hotel website focuses on developing online networks for customers to be able to apply to services in a virtual space, with no need to go out to reserve a room. Posting images and videos provides clients with sufficient details concerning the quality and range of services and products that the hotel can offer. Online interaction also allows clients to respond to the benefits suggested by hotel managers.

Conclusion

I believe that my analysis of the Hilton Hotels & Resorts website will give a fresh insight into the site functions and usability for the authors to make possible changes and improve the quality of the information provided online.

Introduction

Advertisements are used to inform, persuade and influence an individuals decisions regarding a product or service. They are also designed to remind one about the availability or existence of a certain service. Advertisements are conveyed through print, broadcast, and display media. Ads should not have many specific objectives so as to be clear.

The message conveyed in the advert should be rational, morally acceptable and able to elicit the intended emotional feeling. This paper seeks to identify an advert regarding a tourist destination or hospitality company in print media, establish the target market, source, purpose, message, content, execution style, and layout and design. The paper will then discuss whether its a good or bad advertising and how it can be improved.

Advert description

The selected advert was in an airlines travel guide magazine. The ad was about the Nairobis Hilton Hotel. It was made of four pictures: the first, an aerial picture of the towering golden lit building that houses the hotel; the second picture showing a spacious luxury carefully furnished room; the third picture shows an executive club lounge that is located on the 15^th floor; the fourth picture shows a high class wine bottle and glass that are in scripted with the word Hilton.

The heading large is large black font and reads Executive life at the Nairobi Hilton. The advert also describes the executive features that are located on the executive floors of the hotel building. It also gives a description of the club room, the meals, and other services that are offered by the hotel. The advert takes a full page and is too wordy.

Advert analysis

Its clear that this advert is targeted to the high end travelers who may wish to travel to Nairobi at some point of their lives. The advert is posted in a magazine and therefore enjoys advantages such as higher geographic and demographic selectivity, reproducibility in high quality, good pass readership and long life.

The purpose of the advert is to persuade, inform and remind high end international travelers of the availability of executive services at the Nairobi Hilton Hotel. The message contains pictures of how the different facilities within the hotel look and describes the quality of services provided.

The headline Executive life at the Nairobi Hilton is big, eye catching and attractive. The message elucidates a positive feeling in the reader who begins to imagine how it is to stay at the hotel. The advertisement is executed in a lifestyle version targeting the elite and high spenders in the society.

The layout of the advert is consistence with high class. A golden picture of the towering cylinder shaped hotel building against a dark background. Carefully lit and furnished rooms that will appeal to the targeted market segment. There is also a picture of a luxurious wine in a bottle and wine glass.

The pictures are the most eye-catching elements of this advert. The wordings are not that neat. The heading is written in a large bold and black font and almost takes a fifth of the page. The description of the hotel, its facilities and services offered is done in a small black font that is neatly arranged alongside the images. The descriptions offer detailed information about the hotel and the services offered.

Ads effectiveness

A good ad is often required to have congruity and synergy among all its parts. The source, the content, the style, the layout and the design should agree with each other. The current ad has everything right except in some aspects of the layout. The pictures and the heading are all eye catching. The only thing that was not done correctly is the wordiness of the descriptions and the small font used.

The fonts are too small to attract the interest of any person who would like to know the finer details about the hotel. Anyone seeing the ad is readily attracted to the nice pictures and the eye catching headline. However, one does not get motivated to read further due to the tiny font used to give finer details. The descriptions are also given on an ordinary font of black writings against and white background. Due to this malfunction, the overall effectiveness of the ad has been greatly compromised.

In order to change or improve the ads effectiveness, the wordiness needs to be done away with and replace with a clear concise description of the important elements of the hotel. The font style, color, and background needs to be improved to ensure that it is readily readable. For instance, one can use bright orange large font against a dark back ground. This will rhyme well with the other elements of the advert.

Conclusion

This paper sought to analyze a hospitality advert in a print media and discuss whether its good or bad advertising and give recommendations on how it can be improved. An advert on Nairobis Hilton was chosen in a travelers magazine. The ad had everything writer except for its long message described in a small font. Congruency and synergy can be achieved by removing unnecessary details and enlarging the font.

Introduction

The purpose of this paper is to provide an in-depth analysis of two leading companies in the hospitality industry- Hilton Hotels and Marriot international. The aim of this analysis is to identify the major factors affecting their strategic direction and predict their future performances and possibility of existence in a rapidly developing and highly dynamic industry.

Comparative SWOT Analysis

SWOT analysis of Hilton Hotel International

Strengths

Hilton Hotel international is a global leader in the industry, being the world’s second largest group of hotels after Marriot International¹. This means that the company has an advantage of size and global presence, which allows it to maximize its profitability².

The company has a diversified corporate portfolio, with a wide range of products based on both price and service³. In fact, the company has about nine different brands- the Hilton, Waldorf-Astoria Collection, Conrad Hotels and Resorts, Embassy Suites, Hilton Grand Vacations, Hilton Garden Inn, Hampton Inn and Suites, the Doubletree and Homewood Suites by Hilton⁴.

Thirdly, the company ha a focused development that allows it enter into and consolidate new markets. The company has been pursuing its growth strategy with aggressiveness with an aim of consolidating its presence throughout the world. In addition, it aims at capitalizing on the dynamic and booming hotel, travel and tourism industry as well as the emergent world markets such as India, Brazil and China. For instance, the company announced a major plan of building more then 300 outlets in the Asian Pacific region alone beginning 2008.⁵

A loyalty program, the “Hilton HHonours” established at the company is one of its major advantages and strengths⁶. With this program, the company has become a well-recognized partner in the travel and tourism industry. In 2007, the company announced its plans to extend this loyalty program to include Experience Rewards, which aims at offering its more then 17 million customers with personalized and experience-oriented options as a reward and appreciation⁷.

In addition, the company extended its blackout dates in 2008, which made it more valuable in the eyes of its customers throughout the world. From an analysis of the company, it is worth noting that a strong loyalty program is important in retaining its customer and crating brand loyalty among the new customers in order to boost its revenues in the future.

Weakness

A focus on domestic market is actually a problem at the company. For instance, the company’s presence in the United States accounts for more than 80% of the company’s entire hotels⁸. In fact, poor diversification of presence seems to be a problem because it makes it vulnerable to any economic crisis that may hit the American market.

Secondly, the company has been quite late and slow in its international expansion. In fact, the company started late in expanding into other markets, first concentrating on its American presence and giving its rivals a smooth time for operating and investing in foreign markets⁹. Due to its lateness, the company is finding its difficult to penetrate foreign markets, especially where its rivals have consolidated and invested widely prior to its entry.

It is also worth noting that the cost of real estate investment is hurting the presence of Hilton Hotels in various parts of the world such as China, India and Russia. Due to its lateness in entering these new markets, the company is finding it hard to establish itself due to increasing cost of real estates, especially because these areas are hot spots for investment due to the good economic progress demonstrated by these countries.

Single ownership is another weakness affecting Hilton Hotels. As a privately owned corporation, the company is susceptible to any problem associated with poor decision-making and corporate handling.

Opportunities

The dynamism of market growth in emerging economies such as India, China, Brazil, Russia and South Africa provides the company with an opportunity to expand its foreign presence and take the advantage of low presence of foreign companies in these areas. Secondly, the presence of Luxury brands provides Hilton Hotels with an opportunity of redefining its brand and expanding its portfolio.

Technological dynamism and revolution provides Hilton Hotel with an opportunity to take the advantage by developing unique global brands to compete with its rivals in the industry.

Threats

The presence of individual consumer price has increased the demand for unique lodging experience, which is in turn driving towards the establishment of independent hotels. This is common in the United States, which presents a major threat to Hilton that operates as a chain of hotels.

Secondly, the company is threatened by a major downturn in business travel, especially after the world economic crisis of 2007-2010 and its aftermath. Moreover, the invention of e-commerce and internet technology has greatly reduced the need for business travelling, which in turn affects hotel companies.

SWOT analysis of Marriot International

Strengths

Marriot International Inc is a global leader in hotel and travel industry, taking more than 5% value share as at 2010. It is the largest company with a wide geographical presence in the world. Unlike Hilton Hotels, Marriot has an unhampered hotel ownership, owning less then 1% of its portfolio. This means that it has the capacity to avoid price and market fluctuations as well as major and minor economic crisis in a given region.

Like Hilton, the company has a focused pipeline development, where it is pursuing a growth strategy to consolidate its presence in the emerging world markets and to capitalize on the dynamically booming hotel, travel and tourism industries. It is also worth noting that the company has taken the advantage of the internet technology, with a strong and effective website that guarantees a good online trading, advertisement and communication with its customers.

Weaknesses

Like Hilton Hotels, Marriot International Inc is likely to suffer an economic blow due to its heavy presence on the American market. In fact, it has a strong focus on domestic market. Secondly, the company’s focus on luxury brands leaves it vulnerable to any potential global economic crisis.

In addition, it is evident that the company’s focus on Courtyard Brand is a major weakness because the brand is losing its core customers, with experts arguing that business revitalization is not enough to lure the company’s customers back because there is already a fierce competition in the industry.

It is also worth noting that the company lacks a low-cost lifestyle brand, instead, it focuses on luxury brands. This leaves the company les popular among the low and middle-income earners and the most common and largest group of customers.

Opportunities

The presence of emerging markets in Asia, South America and Africa means that companies like Marriot are set to use their massive resources to enter these markets and lock out smaller companies. Secondly, technological advancement places companies with massive resources at a better position to use new technologies as a competitive advantage over upcoming corporations with less resources.

Threats

Consumer confidence is a general threat to companies like Marriott due to its impact on the income levels of the potential customers. In addition, credit crunch remains a threat to multinational companies like Marriot.

Comparative PESTEL analysis

• Political: The two companies share a common political environment, especially because they are located in the United States. However, the wider geographical presence of Marriot over Hilton means that it has diversified its risks associated with localized political threats.
• Economic: The two companies have invested heavily in their international presence, thus diversifying their ability to cope with economic hurdles in various nations¹⁰. However, Marriot’s wider presence means that it beats Hilton on this ground.
• Social factors: social aspects of world population are likely to affect the companies both positively and negatively¹¹. Population growth in foreign markets is likely to favor Marriot due to its heavy presence in foreign markets.
• Technological: Internet technology seems to favor Marriot because of its heavy presence on the internet and a focus on e-commerce.
• Environmental: Both companies experience similar economic effects in their business due to similarity in location and operation.
• Legal factors: in the United States and Europe, the two companies share a common legal environment. However, in some foreign markets, they differ sue to their differences in locations.

Conclusion

From the comparative analysis, it is evident that the two companies have a better future in terms of their performance. However, Marriot seems to have a number of advantages over Hilton, which means its future is much better then than of Hilton.

Bibliography

1. Barrows, C & T Powers, Introduction to the Hospitality Industry, John Wiley and Sons, New York, 2008, p. 19
2. Cho, E, Greening hospitality: A comparative analysis & design of furniture, fixtures and equipment in a hotel guestroom, Cornell University Press, Cornell, 2009, p. 98
3. Belch, G, Advertising and Promotion: An Integrated Marketing Communication Perspective, Publisher McGraw-Hill, London, 2008, p. 59
4. O’Fallon, M, & D Rutherford, Denney, Hotel Management and Operations, John Wiley and Sons, London, 2011, p. 21
5. Bowie, D & B Francis, Hospitality Marketing, CRC Press, New York, 2011, p. 52
6. Cathy, A, The Cornell School of Hotel Administration Handbook of Applied Hospitality Strategy, SAGE, New York, 2010, p. 43
7. Armstrong, M, A, Handbook of Personnel Management Practice, 8th edn, Kogan Page, Milford, 2010, p. 57
8. Abraham, P, International Encyclopedia of Hospitality Management, Butterworth-Heinemann, London, 2011, p. 87
9. Nick, D, Frommer’s England and the Best of Wales 2012, John Wiley & Sons, New York, 2011, p. 38
10. Pizam, A, International encyclopedia of hospitality management, Butterworth-Heinemann, London, 2011, p. 129
11. Brotherton, B, An introduction to the UK hospitality industry: a comparative approach, Butterworth-Heinemann, New York, 2010, p. 134

Hilton Worldwide is one of the leading players in the hospitality and leisure industry. In order to analyze Hilton Worldwide’s performance within the industry, it is important to compare financial ratios against the company’s past performance for the year of 2012, competitors’ performance, and the industry’s averages.

Trend Analysis

The trend analysis allows comparing the firm’s performance over a certain period of time, while focusing on present and past liquidity, profitability, and efficiency ratios. Liquidity ratios, including current, quick, and cash ratios, are important to examine Hilton Worldwide’s capacity to pay debts. Hilton Worldwide’s current, quick, and cash ratios for 2014 can be discussed as decreased in comparison with the data for 2012. This fact points at the company’s failures to improve the liquidity as the ability to address financial obligations (Table 1).

Table 1. Liquidity Ratios.

Referring to profitability ratios, it is possible to state that the situation for 2014 was positively changed in comparison with the data for 2012. Hilton Worldwide slightly improved its profitability after two fiscal years in terms of providing more services and generating more profits, as it is seen with references to increased Gross Margin and Operating Margin (Table 2). Thus, Hilton Worldwide became more profitable and efficient.

Table 2. Profitability Ratios.

Much attention should be paid to Total Assets Turnover as the efficiency ratio to measure the firm’s abilities to convert available assets to generate cash assets. Referring to the data for 2014, it is possible to state that Hilton Worldwide’s income significantly increased in 2014 in comparison with 2012, as it is observed with references to the Total Assets Turnover rates (Table 3).

Table 3. Efficiency Ratios.

Interfirm Comparison

To analyze Hilton Worldwide’s position within the industry, it is necessary to compare the ratios with the ratios typical for such two key competitors as Marriott International and Starwood. In relation to liquidity ratios, Hilton Worldwide is a leader in the industry, having the highest ability to repay short-term debts. However, the profitability ratios are lower than the ratios of Starwood. Efficiency ratios can be discussed as median (Table 4).

Table 4. Interfirm Comparison.

Comparison with Industry Standards

Depending on the data for 2014, it is possible to state that Hilton Worldwide’s ratios are higher than those ones typical for the industry. Furthermore, the firm’s liquidity capacity is inclined to increase (Table 5).

Table 5. Comparison with Industry Standards.

Comparison with standards or industry averages allows understanding the trends regarding the company’s performance. Hilton Worldwide demonstrates improvements regarding the liquidity capacity, but the profitability ratios are lower than those characteristic for competitors.

The factors affecting demand and supply in the tourism industry

The tourist industry can be affected by multiple factors, as shown by Ivanovic and Wassung (119-138). The demand is defined by psychological (motivation to visit a place because of its specific features), economic (for example, the economic situation in the world, the country of the traveler, and the destination country; currency exchange opportunities, and so on), political (intergovernmental relationships), technological (the presence of infrastructure) and sociocultural (especially tensions) factors. The supply is influenced by most of these factors including the demand itself, but its specific group is the legal one (related to the business regulations). A specific factor for demand is marketing efforts.

The kinds of elasticity for Hilton hotels and the most important factors affect the price elasticity

Elasticity describes the dependence of one variable on another one. For example, Mankiw defines the price elasticity of demand as a measure of “how much the quantity demanded a response to a change in price” (90). This type of elasticity typically used by firms and is likely to be of interest to Hilton Hotels (McEachern 111). Other kinds may include the income or cross-price elasticity of demand. The latter defines how the changes in the price of a substitute product affect the price of the one that is being discussed (Mankiw 97-99)

The elasticity is found by dividing the percentage change in the dependent variable by the alteration in the independent one. If the number exceeds 1, the dependent variable changes significantly and is elastic; otherwise, it is inelastic (Mankiw 92). Demand elasticity depends on the factors that affect the demand, substitutes’ availability, and the type of the product: it is low for necessity goods, but luxury ones like hotel accommodations tend to be highly price- and cross-price elastic, which applies to Hilton Hotels (Mankiw 91-92).

The law of elasticity and its validity for Hilton

Hilton Hotels is a worldwide company and one of the most renowned brands in the hospitality industry (“Take me to the Hilton” par. 1). Hilton is a luxury hotel, which defines certain specifics of its customer profile (Sung et al. 125). A large portion of its clients prefers to receive high-quality service and do not mind high prices. Some consumers are attracted by the price and regard it as a sign of luxury and status. Finally, there are many loyal customers. For these groups of customers, the law of demand and typical elasticity behavior are less applicable to Hilton.

On the other hand, not all the potential customers belong to the mentioned groups, and the demand for hotel accommodations cannot be called inelastic. A study by Tran, for example, suggests that the price elasticity of demand for the most expensive hotel rooms is 1.2: it may be unimpressive for a luxury good, but it is still elastic (129). Therefore, the typical elasticity behavior applies to Hilton Hotels to an extent, and it is not completely excluded from the law of demand. If Hilton prices rise, the demand is likely to fall, especially for certain segments of the customers.

The factors affecting the perfectly competitive market types

The tourism industry is of great importance for Egypt’s economy, and several renowned brands compete for this market (Sobaih and Jones 165). For example, Hurghada and Sharm El-Sheikh rely on this sector greatly (Al-Shuwekhi par. 3). The near-perfect competition on the market defines some specifics of its price formation and demand elasticity. This type of market is characterized by such several buyers and sellers that excludes the possibility of any single of them affecting the market price (Mankiw 66). As a result, the price elasticity of demand in Hugarda tends to be guided by the laws of the market: when the demand is high (high season), the price grows significantly, but it does not lead to a decrease in the demand. However, when the season is low, the demand becomes very price and cross-price elastic.

Elasticity analysis and its importance to Hilton’s managers

Hilton is not unaffected by the law of demand, and it exists in the conditions of severe competition that are especially noticeable during the low season in Egypt, for example. As a result, Hilton’s managers, as well as any others, need to take into account the elasticity of their products and services (McEachern 111).

Works Cited

Al-Shuwekhi, Abdel Razek. “Sharm El-Sheikh, Hurghada lose 55% of tourism demand: report.” Daily News Egypt. 2016. Web.

Ivanovic, Milena, and Natalie Wassung. Tourism Development . Cape Town: Pearson/Prentice Hall, 2009. Print.

Mankiw, Gregory. Principles of economics. Boston, Massachusets: Cengage Learning, 2014. Print.

McEachern, William. Economics. Mason, Ohio: Cengage Learning, 2015. Print.

Sobaih, Abu Elnasr, and Elnasr Jones. “Bridging the Hospitality and Tourism University-Industry Research Gap in Developing Countries: The Case of Egypt”. Tourism and Hospitality Research 15.3 (2015): 161-177. SAGE. Web.

Sung, Yongjun, Sejung Marina Choi, Hongmin Ahn, and Young-A Song. “Dimensions Of Luxury Brand Personality: Scale Development And Validation.” Psychology & Marketing 32.1 (2015): 121-132. EBSCOhost. Web.

“Take me to the Hilton.” Hilton Worldwide Website. Hilton Worldwide, 2016. Web.

Tran, Xuan. “Price Sensitivity of Customers in Luxurious Hotels in U.S.” E-Review of Tourism Research 9.4 (2011): 122-133. EBSCOhost. Web.

Design

The Hilton Hotels & Resorts website is an informative online page that provides interesting details about services and options for clients. There are a number of attributes and features that capture my attention. First, the website contains a menu that helps website users to book a room in a hotel and order tickets in accordance with the established dates of staying at a hotel. Second, the users can immediately learn about the benefits of choosing the hotel services by clicking “View Details” link. Third, I was impressed with the website interface that demonstrates marvelous views of the hotel, changing every 10 seconds. Finally, it is also possible to conduct personal research on the questions that interest users, most of all.

Structure

The structure of the website is well organized for users to easily navigate across hyperlinks, tags, and folds. This is of particular concern to the ability of potential clients to learn more about services, as well as guidelines to reserve the room. Besides, there is no necessity to click on the find tabs to learn more about the information it can contain. Despite the disadvantages, there are some shortcomings of utilizing the website functions. Specifically, I have problems with finding a registration field and login details because of the small font of the text. In addition, the website prioritizes the find tabs that can allow the users to order services or learn more about the hotel. Such a tool is aimed at advertising rather than delivering useful information.

Content

While viewing specific information about hotel rooms and services, I have noticed that I can easily return to the main menu because all basic find tabs are still at my disposal. Although there are a number of links and tabs providing valuable information, it is still typed by small font, which makes it difficult for users to evaluate its importance. The hotel website contains the positioning of the main statement and brand of the hotel on each of the links that the user can find.

There is also much information about beneficial packages that Hilton managers can propose to their customers that range from room services to conference halls. Each type of package is clearly described and explained. In general, the site is oriented on the clients that plan to make use of the website services, as well as online services proposed on the spot. Finally, the website contains many pictures of the resort for users to have a better idea of the services.

Social Media

With regard to the recent trends in managing hotel business online, the hotel website focuses on developing online networks for customers to be able to apply to services in a virtual space, with no need to go out to reserve a room. Posting images and videos provides clients with sufficient details concerning the quality and range of services and products that the hotel can offer. Online interaction also allows clients to respond to the benefits suggested by hotel managers.

Conclusion

I believe that my analysis of the Hilton Hotels & Resorts website will give a fresh insight into the site functions and usability for the authors to make possible changes and improve the quality of the information provided online.

Introduction

Hilton Hotels & Resorts refers to an internationally recognized group of hotels and resorts with a presence in six continents. The international chain of hotels was started in 1943 by Conrad Hilton, but now operates under the Hilton Worldwide flagship in 78 countries (Marketing Week 2011). The current paper is an attempt to examine the operations and presence of Hilton Hotels & Resorts in four countries of choice namely, Saudi Arabia, Poland, Turkey, and Thailand.

Country 4: Thailand

There are four Hilton hotels in Thailand: Bangkok, Pattaya Chonburi, Phuket, and Hua Hin. In Bangkok, the again has two hotels; the Millennium Hilton, and Hilton Sukhumvit (Hilton Worldwide 2013).

Product

The hotel has managed to integrate its international themes of quality and excellent provision of services to its guests in the Thailand market while at the same time allowing them to sample the rich cultural heritage of the country.

The hotels have been designed in an innovative and thoughtful manner. The rooms in all the Hilton Hotels in Thailand have been designed while taking into account the issues of convenience and comfort.

Thus way, they enable guests to not only unwind after a long day, but also work in a cool and serene atmosphere. In addition, the Hilton hotel in Thailand gives their guests the options of suites, guest rooms, accessible rooms as well as executive rooms, depending on one’s preference and taste.

Place

The Hilton hotels have been strategically situated to not only compete with other leading global players in the hospitality industry in Thailand, but to also curve its niche in the market. Both the Millennium Hilton and Hilton Sukhumvit are centrally located at the heart of Bangkok.

This has enabled the hotel to tap into the market of traveling businessmen, expatriates and government officials who meet in the capital city of Thailand, and whom they mainly target.

In addition, this five star hotel is also strategically located at the heart of Bangkok so that it can tap into the rich market of tourist who travels to Thailand, a key economic sector of Thailand. it is important to note that in 2007, the tourism sector in Thailand accounted for nearly 6.7% of the country’s GDP (Bangkok Post, 2008).

Price

All the different Hilton hotels in Thailand offer a similar pricing package for their guests. However, the prices are beyond the reach of many Thais. Guests frequenting the Hilton hotels in Thailand have disposable income and can afford to stay at luxurious hotels like the Hilton.

Therefore, even when there has been a change in price, this does not impact on the demand and supply for the service offered by the Hilton hotels in Thailand. As such, the hotel enjoys an inelastic demand for its services.

Promotion

In an attempt to reach out to a wider clientele base, the Hilton hotel offers their guests exceptional services, including free parking and valet services. The location of some of the Hilton hotels in Thailand enables guests to gain access to local attractions. For example, Hilton Pattaya offers resort and spa services, and glorious sandy beaches (Hilton Worldwide 2012).

In addition, Phuket allow guests to can also explore Chinatown and Old Phuket Town where they get to sample local cultures ((Hilton Worldwide 2013). Moreover, the Hilton hotels in Thailand also offer outdoor venues for hosting conferences and meetings. Also, the hotel menus are highly customized, offering both local and international cuisines.

Conclusion

The Hilton Hotels & Resorts is an internationally recognized chain of hotels and resorts with a presence in 78 countries and six continents. The company mainly targets leisure and business travelers and as such, it has locations near convention centers, major cities or near airports in all the four countries.

The pricing strategy is also similar in most of the Hilton hotels, while the products is customized to give a blend of local and international tastes to the traveling or visiting guests.

Reference List

Bangkok Post 2008, Thailand Tourism Review. Web.

Hilton Worldwide 2012, Hilton Pattaya Hotel. Web.

Hilton Worldwide 2013, Thailand Hotels- Hilton Hotel Locations in Thailand. Web.

Marketing Week 2011, Case study: Hilton Worldwide. Web.

For businesses in the hospitality sector, comparative advantage is key to survival. This is because brand identity and competition is very high in the hospitality industry. There are many enterprises in the sector that offer almost the same product in the market. Therefore, it is only through effective customer services that one set up may attract customers than the other. It is for this reason that it is easy to find more established names in the sector having a wide customer base while their competitors continues to struggle in the market (Bian, & Liu, 2011). This paper looks at one of the established companies, the Hilton Hotels; under the brand name Hilton Worldwide.

History

The history of Hilton hotel can be traced back to the year 1919, when Conrad Hilton – the hotel’s founder set up a 40 room hotel in Texas by then (Hilton, 2014). After many milestones, today the Hilton Hotel under the brand name Hilton Worldwide has grown to be one of the most prestigious companies in the hospitality sector. It has been able to expand from the single hotel in Texas to major towns and cities across the world. As a result, it is also one of the largest and fast growing hotel chains in the world with over 4000 hotels spread across more than 90 countries in the world. Hilton worldwide offers a variety of services for its global customers including room service, vacations, food service, and conference services among others (Hilton, 2014).

The company has also partnered with other organizations through licensing and franchise agreements to be able to establish its brand and heritage associated with full service across the globe. Performance experience has also been key to the organization. As per its mission, the company seeks to become a global hospitality company that provides leadership in the areas of customer service through its values of honesty, integrity, leadership, teamwork, and ownership (Hilton, 2014). To be able to retain a strong position in the market, Hilton has continued to undergo a transformation through service improvements, partnerships and global expansion.

As a result, it has also been posting good financial results, which is important for any company in the sector. However, all the successes mentioned in this section have not been achieved without challenges at one stage or the other. Some of its key past and current problems are discussed in the following section.

Past and Current Problems

First, for any service sector company like Hilton, customer service management has posed great challenges. The clients in the high-end segment of the hospitality sector particularly are more sensitive to the nature of service being offered. They are always looking for new things and quality service. As a result, every company has to constantly improve its services in order to increase its chances of growth in the sector. Given that Hilton Hotels is a multinational brand; dealing with the expectations of customers from different regions was one of its past challenges.

Secondly, given that the global market is denoted by diverse cultural, legal and ethical foundations, the company has faced a lot of challenges in its quest to widen its market reach. In terms of culture, the company has had to realign its services according to the cultural expectations of different regions, which may take a lot of time and resources. The legal requirement of setting up and operating businesses in different countries is also one of the greatest challenges the company has had to face. For instance, there are constant changes in the nature and number of requirements in different regions or countries that in turn influence how the company is to conduct is operations and engage in other activities like promotion.

Marketing of the Hilton also requires huge amounts of capital for market research and the development of promotional channels and materials. As a result, this is one of the areas that previously provided great challenges for the company. However, with a well-known brand today, the company has significantly reduced the problems associated with marketing of its brand. In addition, all the activities of the company require a highly trained and dedicated team. In some regions, sourcing for skilled labor specifically trained for the hospitality sector has been a major problem. On the other hand, human resources management and recruitment of best candidates has been a costly affair with rising pay rates across the globe.

Hilton Company also faces a great competition in the market that may be a hindrance to its financial and growth prospects. The hospitality industry is characterized by relatively lower capital for establishment and as a result is highly competitive due to numerous hotel establishments offering the same products and services. Since Hilton hotel targets the high-end customers, competition has highly affected its performance owing to the recent economic challenges in the global markets. For instance, due to reduced disposable incomes, many customers prefer relatively cheaper alternatives.

The reality is that there are luxurious hotels that have managed to offer competitive packages to customers across the world. In addition, the company has also had to contend with high rivalry among other large hotel chains like Marriot international, Intercontinental Hotels, Starwood, and many other established brands in the market.

Solutions

Having noted the problems facing the hotel, there are many solutions that may be available for the company. First, the company should be able to create a culture of customer service excellence in line with its promotion of teamwork within its core operations. Through this, every client is to be served according to their different expectations. Secondly, product and service differentiation is also essential for the company’s success in the global markets (Kosová, Lafontaine & Perrigot, 2013). Due to different culture and religions, there are many issues associated with food service, presentation and marketing that must be done differently. The company can only succeed in the different regions if it is ready to come up with themed services, for instance, that will create an identity according to the regions being served.

In addition, the company should also exploit the benefits of cost differentiation. Overreliance on the high-end customers may be unhealthy for its financial performance especially with economic turbulence in the global front. As it continues to expand, developing packages for middle income earners will also be prudent enough for it to expand its market reach and take on its competitors. For marketing, the company should intensify its brand campaign using online platforms. The online marketing platforms usually provide cheaper and more effective alternatives of reaching the targeted individuals.

Particularly, like other hospitality sector operators have done, social media should be a priority. This is because social media encourages referrals and enhances a faster spread of information to millions of users across the world within short time spans in comparison to conventional advertising. Lastly, the company’s expansion program should be focused on the emerging markets particularly in the Asian continent. This is because the economic prospects in this region have remained high despite the advantage of accessing mass markets. This will help in the boosting of the company’s financial might through increased revenues.

Impacts and Improvements

There are various impacts that the hotel will experience with the adoption of the solutions suggested above. First, cost differentiation is one of the best alternatives the company has to enable it expand its markets and deal with intense competition in the sector. By introducing relatively lower pricing, many individuals who would have wanted to have a Hilton experience will opt for the company’s services. This will also impact on its profitability because sales will increase and thus augmented revenues. Secondly, exploiting the benefits of expansion in the emerging economies will help to boost the company’s revenue base as well as add to its already wide market reach in the global hospitality sector. Third, adoption of innovative technologies to boost efficiency in product and service promotion will have significant impacts on the company’s brand success.

Even though Hilton is an established brand, taking advantage of social media to promote its services may work for its marketing as well as research and development departments. This is because social media encourages a lot of interaction and immediate feedback from customers. This information is important for constant service improvement (Wang, Chen & Chen, 2012).

References

Bian, J., & Liu, C. (2011). Relation between brand equity and purchase intention in hotel industry. International Journal of Services and Standards, 7(1), 18-34. Web.

Hilton, (2014). History and heritage. Web.

Kosová, R., Lafontaine, F., & Perrigot, R. (2013). Organizational form and performance: evidence from the hotel industry. Review of Economics and Statistics, 95(4), 1303-1323. Web.

Wang, C. H., Chen, K. Y., & Chen, S. C. (2012). Total quality management, market orientation and hotel performance: the moderating effects of external environmental factors. International Journal of Hospitality Management, 31(1), 119-129. Web.

The hospitality industry is one of the most competitive sectors in contemporary global market. To survive, companies operating in this sector have come up with innovative measures of retaining existing clients and attracting new ones. One of the strategies used is the loyalty program. For example, the Hilton group of hotels has come up with such a program to cater for the needs of its guests.

Hilton HHonors is one of the well known plans in this industry. The package is very attractive to business travelers. One of the major advantages associated with it is the large number of participating hotels in different parts of the world. To this end, the program has brought on board more than 3,500 partners.

In this paper, the author addresses 5 questions in relation to the Hilton HHonors case study. To this end, the author will analyze the benefits of a loyalty program to the stakeholders. For example, the benefits of the program in relation to the management of customers will be analyzed. The value of the program to Hilton will also be analyzed.

In addition, a comparison will be made between Hilton and Starwood brands and their value to a franchisee. Recommendations will be provided on how the company can utilize the revenue generated through the program. Finally, the author will analyze the possible strategies that Hilton can adopt in response to the threat posed by Starwood.

Using Loyalty Programs to Effectively Manage Customers

Loyalty programs are very important marketing tools, especially in the service industry. They help companies to retain clients. Kotler, Armstrong, Trifts, and Cunningham (2013) are of the opinion that these programs entail understanding customers and how they connect emotionally and rationally with a given brand. The marketing strategy is widely used in Canada today.

Loyalty programs in the hospitality industry seek to attain the aspects of customer reliability. The competition posed to Hilton brand calls for a more comprehensive marketing strategy. In line with this, the company (and other brands in the industry) can use loyalty initiatives to improve the management of customers in several ways.

To start with, managers and brand owners need to identify the relationship between brand equity and allegiance. Income from loyalty programs should facilitate the growth and prosperity of the company in numerous ways. Rewarding employees and increasing the value of shareholders can be used in the formulation and implementation of this marketing strategy.

Another way through which loyalty programs can be used to manage customers involves striking a balancing between transactional and relationship marketing. Transactional marketing incorporates service standardization and customization by brand managers and property operators (Kotler et al., 2013).

On its part, standardization of services enhances security of employees with regards to service delivery. It helps in the provision of high quality and uniform services to the customers. Relationship marketing features the development of beneficial as well as mutual interactions with the customer. It goes beyond the transactional engagement.

Cultivating relationships with customers through loyalty programs would facilitate their repeated access to the brand and consequent ease in their management. There are various categories of customers in the hotel industry. They include business, conventional, and leisure clients. All these customers have varying desires and tastes. A loyalty program that takes into consideration all these aspects is likely to enhance effective customer management.

The reward scheme should employ tactics that encourage consumers to develop loyal consumption behaviors. The main objective is to align value for customers with consumer (Kotler et al., 2013). Targeting the various categories of consumers in the hospitality industry and satisfying their needs will increase loyalty and profitability.

Value of HHonors Program to Hilton

The cost of the HHonors World Wide Program can be quantified using the income and members-paid activity statements for 1998. In this period, the costs incurred in the program amounted to $69,438. The revenue generated stood at $69,837. Consequently, net income was $399 (Deighton & Shoemaker, 2005).

The program required significant input from the company. However, the net returns are insignificant in comparison to the extensive investments that went into the plan. The true worth of HHonors program to Hilton brand, as a result, is questionable. The costs incurred in implementing it are higher than the monetary gains made. Kotler et al. (2013) highlights the importance of measuring and managing the returns made from marketing programs.

Determining the long run value of the undertaking takes precedence. Hilton brand might have incurred substantial costs in the implementation of the program, but the quantified output fails to reflect the actual value at the moment. Loyalty programs have a number of objectives. One of them includes rewarding loyal customers.

Through the program, Hilton brand can generate market information and manipulate the behavior of consumers through strategic plans (Kotler et al., 2013). As such, apart from the quantified value, the company can combat competitors and defend its market share by managing customers’ value using the information gathered with the help of the program.

Getting customers in the hospitality industry is vital. However, retaining them is even more important for the long term wellbeing of the business. The costs of HHonors are offset by the long term benefits of doing business with existing customers.

In addition, the program is likely to attract additional guests, increasing the ratings of the brand in the market. The arrangement also offers the added advantage of helping the brand to communicate with customers through sustained contacts. The value of this plan to Hilton brand is worth the costs. The worth is justified by the long and short term benefits associated with it.

Determining the Value of Loyalty Programs to Franchisees

Loyalty reveals the degree to which a customer is attached to a given brand (Kotler et al., 2013). The quality is regarded as a key determinant of brand longevity. The major beneficiaries of this concept are the owners of the product. They enjoy it more than the other ‘perpetuators’ of the brand.

In franchising, the franchisor sells or allows the franchisee to use their systems and knowhow in running their business. In most cases, the latter can carry out their business activities under the control and with the support of the former. Benefits to the franchisees range from being granted brand names, products, services, signs, and elements of managing businesses by the franchisors.

A franchisee can evaluate the benefits of adopting Starwood or Hilton brands and making them part of their property. The value of such a venture can be determined by analyzing the nature of existing royalties. Such measures are essential in sustaining profits. Lack of explicit profit structures by any of the two hotel brands translates to low levels of sustainability. A franchise relationship with the brands might force franchisors to set high fees to generate profits.

The brand to invest in through franchising can be determined through level of franchisor’s support, and the strength of the brand name. A well recognized and profitable brand is more likely to benefit the franchisee compared to a nondescript product. The support of the franchisor in relation to business operations, infrastructure, knowhow, and supervision must be geared towards enhancing the value of the engagement to the franchisee.

Success in the hotel industry requires the provision of superior services. According to Kotler et al. (2013), businesses must strive to sustain and improve the quality of services they offer. As already indicated, the hotel industry is highly competitive. As such, the franchisee needs to determine the efficiency of the tactics and strategies aimed at implementing their loyalty programs. The strategies that pay attention to customer perceptions are more beneficial than those that do not.

Increasing Franchisee’s Benefits through Increased Loyalty Revenue

If a franchisee pays 10 cents per dollar as opposed to the current 4.5, the revenue from the program would increase significantly. HHonors can spend the additional revenue to enhance the value of the franchisee. For instance, the loyalty program would generate more profits for the franchisor under such circumstances.

Consequently, Hilton will invest a lot in marketing activities to facilitate brand awareness among customers, attracting more clients to the hotels. The increase in the number of clients would improve sales and raise revenue. Franchising can help Hilton to invest in research and design. Increased revenue can enhance capital investments by the brand, such as the construction of more hotels (Kotler et al., 2013).

In addition, by launching new menus and services, the company would increase the options available to the customers. Apart from satisfying consumers, the loyalty program would make the franchisee more profitable. The franchisee can also benefit in terms of contract renewals from the franchisor’s loyalty program.

The profits of the franchisee may increase as a result of the business activities of the franchisor. In such cases, the former’s brand loyalty is enhanced. The loyalty would convince the franchisor to renew the contract. All these are indications of the benefits of doing business with such brands as Hilton and Starwood.

Hilton’s Response to Starwood’s Loyalty Program Initiatives

Starwood has resolved to address competition through its loyalty program. Such initiatives necessitate a response from Hilton. However, responding by expanding Hilton HHonors might not realize the needed positive outcomes. Hilton can choose to alter the strategies and tactics used to generate customer loyalty. According to Kotler et al. (2013), loyalty programs can succeed by combining various marketing tactics.

For instance, customized combination of transactional and relationship marketing approaches can enhance Hilton’s loyalty program. Hilton HHonors program should adopt various approaches to create loyalty. The company should fight the temptations of increasing rewards. For instance, the organization can divide the market into segments using such elements as rate of usage, lifetime value, loyalty, and frequency.

At the end of the day, the brand will determine the most attractive consumer groups. The company should then target the relevant groups using transactional or relational marketing strategies. Targeting would facilitate effective response to the needs of the specified category. The approach would increase customer satisfaction and enhance value creation for the brand.

Hilton’s transactional marketing strategy should offer highly differentiated services. The approach would demonstrate to the customers the genuine value of their money. The company’s relationship marketing strategy should indicate a profitable value proposition engagement with the customers. The approach should utilize relational databases, promote brand culture, and manage the customer-employees’ interface.

Reference

Kotler, P., Armstrong, G., Cunningham, P., & Trifts, V. (2013). Principles of marketing (9th Canadian ed.). Ontario, Canada: Pearson Education Canada.