Marketing Hospitality, 3rd ed., Hsu/Powers Chapter 6 Marketing Strategy

Concept of Strategy n A course of action aimed at ensuring that the firm will achieve its objectives by matching its internal resources and skills with the environmental opportunities and risks it faces

The Marketing Strategy Triangle Corporation Competitors Customers Value Product/Service Differentiation Target segments Other market segments Technological Environment Social Environment Economic Environment Ecological Environment Political Environment

Strategic vs. Functional Marketing Strategic n Long range n Strategic perspective n Broad resource allocation n Less formalized n Proactive n Broad issues n Senior managers Functional n One year n Marketing programs n Short-term trade-offs n More formalized n Reactive n Specific issues n Operating managers

Corporate Headquarters Strategic Business Unit 1 (e.g., Travel Services) Strategic Business Unit 2 (e.g., Lodging and Foodservice) Strategic Business Unit 3 (e.g., Real Estate) MarketingOperations Human Resources Accounting Unit Level Unit Level Unit Level Unit Level Unit Level Unit Level Unit Level Unit Level

Corporate Mission Identification of SBUs SWOT SBU Mission and Strategies Positioning Functional Strategies and Plans Portfolio Analysis

Hilton Hotels Mission Statement n Hilton Hotels Corporation is recognized internationally as a preeminent hospitality company. Among our 250 hotels are some of the most well-known properties to be found anywhere, including The Waldorf-Astoria, Hilton Hawaiian Village and Palmer House Hilton. Our hotels offer guests and customers the finest accommodations and amenities for business or leisure. For 80 years, the Hilton brand name has been synonymous with excellence in the hospitality industry.

HighLow High Low Market Share (Cash Generation) Cash flow Growth (Cash Use) BCG Growth-Share Matrix

CRITERIA Size Market share Profitability Costs Differentiation Financial strengths Human assets Image Technological position Flexibility Marketing effectiveness CRITERIA Size Market growth Competitive structure Profitability Pricing practices Social changes Environmental concerns Technological stability Political considerations Government regulations = build/grow = hold/milk = harvest/divest HighMediumLow Market Attractiveness Business Strength High Medium Low GE Model

Numerous environmental opportunities Major environmental threats Critical internal weaknesses Substantial internal strengths Cell 1: Aggressive strategy Cell 2: Diversification strategy Cell 3: Turnaround strategy Cell 4: Defensive strategy

SBU Mission n Carlson Hotels Worldwide, a division of Carlson Hospitality Worldwide, provides a brand management structure upon which the hotel brands of Carlson Hospitality Worldwide continue to grow as leaders in the luxury, upscale and mid-tier segments of the lodging industry

UniquenessLow Cost Competitive Advantage Industry- wide Particular Segment Cost Leadership McDonald’s Red Lobster Differentiation Wendy’s Differentiation Focus Four Seasons Cost Focus Motel 6 Strategic Target Generic Strategies

New products/services Existing products/services Existing markets New markets Market penetration Product development Market development Diversification Grand Strategies

Positioning n The process of establishing and maintaining a distinctive place in the market for an organization and/or its individual product offerings. n Repositioning

Customer analysis Market segmentation Target market selection Marketing program and operations: Product Price Place Promotion Corporate objectives Competitive analysis Corporate capabilities Product/ service differentiation “Position” Package of benefits selection

Positioning Statement n Differentiate the property n Communicate the benefits n Create an image