Analysis: Hilton Hotel

ANALYSIS: HILTON HOTEL

Table of Contents
1.0 Introduction................................................................................................................................4
1.1 Background of the company..................................................................................................4
1.2 The correspondents to the marketing problem......................................................................5
1.3 Research aims........................................................................................................................6
1.4 Research objectives...............................................................................................................6
1.5 Research questions.................................................................................................................7
1.5 Research hypothesis...............................................................................................................7
2.0 Secondary evaluation.................................................................................................................8
2.1 Current positioning of Hilton hotel........................................................................................8
2.2 Potentials of Hilton’s marketing strategies............................................................................9
2.3 Brand potential of Tru...........................................................................................................9
2.4 Impact of strategies Hilton has undertaken to successfully launch Tru..............................10
2.5 Recommendations gain access to their room key................................................................11
3.0 Research methodology.............................................................................................................12
3.1 Research philosophy............................................................................................................12
3.2 Research approach...............................................................................................................12
3.3 Research designs..................................................................................................................13
3.4 Data collection.....................................................................................................................14
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3.5 Data analysis........................................................................................................................15
4.0 Data processing and interpretations.........................................................................................16
5.0 Conclusion...............................................................................................................................18
References:....................................................................................................................................19
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1.0 Introduction
The hotel industry has been identified as the most booming sector in the global context. Different
multinational brands operating in a similar sector are bringing with them several effective
marketing lines in innovation front to maintain their leading stand in the economy (Bahn, 2012).
In a similar manner, Hilton Group is also recognized as the leading hotel brand in the
international market for its successful set of branches in different nations and franchise
operations (Bakhshi, 2012). The present study attempts to evaluate the current positioning of
Hilton Hotels, the marketing efforts it has taken and their potential in the target market. It would
also underscore the marketing and service designing approach the company is aiming to conduct
for launching its new brand Tru in Maldives or Bali to fit the expectations of midscale segments.
1.1 Background of the company
Hilton Hotels Corporation is the American multinational company operating in the hospitality
sector. The brand tends to manage and franchise a wider portfolio of resorts and hotels in the
global context. The organization was established in the year 1919 and headquartered in Virginia
(Hilton.com. 2019). The information gathered from the provided case study underscores that by
2015, the management of the hotel acquired a market share of 11% and 4610 properties
consisting more than millions of rooms in total 100 nations and territories. It had also been
estimated from the data highlighted in the similar source that Hilton’s operating cash flow
consisted 34% from leased or owned properties, 13% from the managed properties, 11% from
timeshares and 42% from the franchised properties.
It has been identified that the franchise agreements like managing hotel operations and regular
functions are no longer administered by Hilton but by the property owners. It has also been
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managed through approvals and property scrutiny on regular basis. In addition to the previous
process, the organization also offers marketing, technology, internet, advertising, and reservation
process and quality assurance programs. In the consideration of Damoiseau, Black & Raggio
(2011), the franchise agreement of the brand generally varies between 10-20 years for the
property conversions and 20 years for new properties acquisition. In respect to any identified
default or brand standard breech, the management of the organization has the right to terminate
the agreement.
It has been recognized that with the passage of time, Hilton has developed a rapid and steady
operation in the international market (De Villiers, 2011). The brand is explicitly identified in the
industry by the users and the services are primarily availed by the premium business class
segment. The price rates and the charges are not designed as per the spending habits of the
middle-income segment. On the contrary, González-Rodríguez, Jiménez-Caballero, Martín-
Samper, Köseoglu, & Okumus (2018), determined that the midscale segment is also a huge
market who are also showing a greater preference towards the hotels offering affordable price
lines. These segment has been untapped by the Hilton hotel. Therefore, the brand is aiming to tap
the specific segment by launching its new brand Tru in Maldives or Bali.
1.2 The correspondents to the marketing problem
It has been identified from the provided case study that Hilton has undergone the new project by
considering the valuable feedback of the property owners, other internal stakeholders and its
existing customers as well. However, for the first time, Hilton has made an attempt to launch its
brand to tap the midscale market segment (de Queiroz Falcão et al. 2018). Since the brand was
specifically known for it first-class and luxurious operations in the premium segment, therefore,
the approach of starting a midscale operation incurs high potential risks of threats (Diffley,
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McCole & Carvajal-Trujillo, 2018). There are high chances for the brand to skip the necessary
functions that are most desired by the midscale groups. Since Hilton is majorly familiar with the
offerings of premium scale service lines and dealing with the business class segment, hence, the
sudden shift to the midscale standards might lead the brand to over skipping required needs,
which can lead to dissatisfied clients and unsuccessful operation.
Information gathered from the provide case highlights that trip advisors and other social media
influencers have become a major part of the hotels to regularly monitor the feedbacks and
reactions of the midscale customers in terms of services offered in Tru. Some of the customers
have left negative reviews and feedbacks in the social media platforms, which had been a
problematic instance for Tru. This has been another issue for the brand, where the negative
feedback might act strongly against the brand at a very initial stage to restrict its new operation
Tru.
1.3 Research aims
The aim of the research is to evaluate the efforts the team of Hilton is conducting to launch its
new brand Tru in Maldives or Bali to tap the midscale customers. The project would also
highlight and analyze in details the approaches Hilton would be taking in order to fit their service
lines and budgets as per the spending criteria of the target segments. Moreover, the technical
advancements, innovation efforts, service designs and the involvement of stakeholders in the
new project would also be discussed in the present project.
1.4 Research objectives
The research objectives are discussed below:
 To analyze the current positioning of the Hilton Hotel
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