Rosewood Case Solution
I-INTRODUCTION / STATEMENT OF THE PROBLEM
a-) Introduction:
Luxury hotel segment is getting more competitive. Rosewood Hotels & Resorts have been competing in this segment more than 25 years with its distinctive individual hotel brands. On the contrary, guests want to see one unique brand, same quality and service at every hotel that they stay under one corporate brand name.
One corporate brand strategy help companies increase their retention rate, make multi-cross selling and have loyal repeat buyers. Guests also tend to tie the brand of hotels that they stay before with a corporate brand that they are familiar with.
Above mentioned issue signals that current trend in g and competition side is a threat for Rosewood`s future growth and profitability. Market Segment Share may be lost.
Also this can be turned to an opportunity if Rosewood can shape its future strategy towards operating under Corporate Branding. Huge growth opportunities lay in Retention rate, Total revenue, Customer Lifetime Value, Repeat guest numbers. Individual branding is limiting Rosewood`s growth opportunity.
S: Very well-known individual hotel brands.
W: Low awareness of Rosewood and low cross property usage compared to industry.
O: Guests in luxury market segment value corporate brands.
T: The increasing competition between individually branded hotels. Their expansion is %120 on average.
b-) Statement of the Problem
Which marketing strategy will enable us to grow and turn competition threat to an opportunity with increased revenue, retention rate and customer equity without undercutting the distinctiveness of each individually branded hotel?
II-SITUATION ANALYSIS
a-) Company & Competition Information: 2001 2002 2003
# of Hotel Year End 13 13 12
# of Rooms Year End 1.859 1.714 1.513
% of decrease in Room #s 100 92 (-8%) 81 (-11%)
CLTV in 2003 w/Ind. Brd. - - $378
RevPAR $197 $204 $217
Total Revenue
(RevPAR * # of Rooms) $366.223 $349.656 $328.321
a-) Introduction:
Luxury hotel segment is getting more competitive. Rosewood Hotels & Resorts have been competing in this segment more than 25 years with its distinctive individual hotel brands. On the contrary, guests want to see one unique brand, same quality and service at every hotel that they stay under one corporate brand name.
One corporate brand strategy help companies increase their retention rate, make multi-cross selling and have loyal repeat buyers. Guests also tend to tie the brand of hotels that they stay before with a corporate brand that they are familiar with.
Above mentioned issue signals that current trend in g and competition side is a threat for Rosewood`s future growth and profitability. Market Segment Share may be lost.
Also this can be turned to an opportunity if Rosewood can shape its future strategy towards operating under Corporate Branding. Huge growth opportunities lay in Retention rate, Total revenue, Customer Lifetime Value, Repeat guest numbers. Individual branding is limiting Rosewood`s growth opportunity.
S: Very well-known individual hotel brands.
W: Low awareness of Rosewood and low cross property usage compared to industry.
O: Guests in luxury market segment value corporate brands.
T: The increasing competition between individually branded hotels. Their expansion is %120 on average.
b-) Statement of the Problem
Which marketing strategy will enable us to grow and turn competition threat to an opportunity with increased revenue, retention rate and customer equity without undercutting the distinctiveness of each individually branded hotel?
II-SITUATION ANALYSIS
a-) Company & Competition Information: 2001 2002 2003
# of Hotel Year End 13 13 12
# of Rooms Year End 1.859 1.714 1.513
% of decrease in Room #s 100 92 (-8%) 81 (-11%)
CLTV in 2003 w/Ind. Brd. - - $378
RevPAR $197 $204 $217
Total Revenue
(RevPAR * # of Rooms) $366.223 $349.656 $328.321