Business Strategy: Marriott International

This document discusses the business strategy of Marriott International, a leading hospitality firm. It covers the background of the company, its strategic direction, financial performance, and market share. The report highlights Marriott's focus on customer experience, continuous improvement, and responsible business practices.

Business strategy

Executive Summary
Business strategy understood as an course or series of actions that helps an entrepreneur
or business individuals in achieving their desirable goals and objectives. In order to build one of
best strategy for organisation it is very much important to accumulate necessary knowledge and
information to gain competitive advantage. For an organisation to build strategies it is very much
potential to find out gaps and accordingly put one of best efforts in achieving desirable
objectives. By evolving past performance by using data and statistics organisation can find out
major deliverables to gain potential outcomes.

Table of Contents
Executive Summary.........................................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Background of the company...................................................................................................1
Is the strategic direction of the company sound , now and for the future?............................3
Will the financial performance of the company give the investor a good return. .................4
How responsible the company is in respect of their business practices.................................7
CONCLUSION ...............................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business strategy is defined as the set of competitive actions as well as moves which an
organisation utilises for attracting clients, strengthening performance, compete effectively and
attaining their objectives (Fontana, Sastre-Merino and Baca, 2017). This represents that how
efficiently the business is performed to meet the desired targets. Moreover, this is helpful in
developing direction as well as vision for the overall firm. As per the scenario, chosen company
for this report is Marriott International which is a growing American well known hospitality
firm. It managers as well as franchises a board portfolio of hotel and its lodging facilities as well
as having headquarters is in Maryland, Bethesda, U.S. This report covers the background of the
organisation, its strategic directions and financial performance. Apart from this, critical
evaluation regarding how responsible the company is in respect of their business practices are
also discussed in this report.
MAIN BODY
Background of the company
Marriott International, as it is recognized today, started off as A&W root beer stand when
founders J. Willard and his wife Alice Sheets Marriott began a small business with satisfying
people's thirst during hot and scorching summers of Washington D.C. With quality food offered
at equitable rates, the company became a concept among restaurants and introduced Hot Shoppes
which later grew to become Marriott International.
In 1927, the newly wed couple together with Hugh Colton opened the first A&W
franchise with fresh and hot food dishes on their menu and the name Hot Shoppes came into
being (Scholes and et.al., 2014). This was only the beginning, when Marriott opened two more
Hot Shoppes and extended their business by starting catering inside the flights with the restaurant
delivering boxed lunches to the passengers in 1937, this being a fairly new concept. In 1953, Hot
Shoppes stock became public at $10.25/share and got sold out in two hours. After being
successful with the Hot Shoppes, Marriott shifted to the hospitality business in 1957 by
launching the world's first motor hotel in Virginia managed by Bill, son of J. Willard and Alice
Marriott.
Marriott became a successful and a well-recognized brand globally over the next 25 years
with the first Courtyard hotel debuting accommodation for business travellers. The company
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opened its first ever international hotel in Acapulco, Mexico in 1969 and became the first
accommodating company to start their business in the cruise segment in 1972. The first ever JW
Marriott was opened in downtown Washington D.C. as a tribute to the founder J. Willard
Marriott in 1984. With the demise of the founder J. Willard Sr. in 1985, JW Marriott Jr. was
elected as the Chairman of the Board. The company started building new model with many other
brands in the late 1980s. Marriott became the No. 1 company in the hospitality sector in the
world with a gradual increase in its presence all over the world. The company became the first
company offering a collection of brands with the launch of first Fairfield Inn and Marriott Suites
hotels and acquiring Residence Inn in 1987 and Renaissance Hotel Group in 1997. The year
1988 proved to be a milestone year in the history of Marriott along with the inauguration of the
500th hotel in Warsaw, Poland. The brand consecutively launched Towneplace suites and
SpringHill suite by Marriott in the years 1997 and 1998.
With Marriott acquiring ExecuStay corporate housing company in 1999, the brand saw
the demise of its co-founder Alice Sheets Marriott in 2000 at the age of 92. Year 2004 saw the
launch of the first Bulgari Hotels and Resorts property in Milan, Italy whereas Bill Marriott and
Ian Schrager officially announced the EDITION brand in 2008. A new line of deluxe and
unconventional hotels, The Autograph Collection was launched in 2009 (Bharadwaj and et. al.,
2013). Arne Sorenson became the President and CEO of Marriott International in 2012 with the
brand also acquiring Gaylord Hotels Brand which resulted in addition of five hotels and a
meeting and event area of approximately 2 million square feet. The company's first appearance
into the economy tier, Moxy Hotels is a three star hospitality division. In 2014, Marriott doubled
its distribution in Africa to more than 23,000 rooms through the acquisition of Protea Hotels'
Brands in 2015 and Delta Hotels in 2016, hence becoming the largest hotelier in Canada. By
implementing online reservation of hotel rooms and by serving food dishes that are fully trans
fats free at all of its properties in North America, the company earned to be the first hotel chain
in the world to do so.
Marriott serves to be the world's farthest reaching hotel company today, providing more
the 1.1 million rooms across 30 brands in nearly over 110 countries. The company provides also
copies of the book of Mormon besides Bible in its rooms. The brand in present, is on a mission
to shape the future of travel through innovation and technology (Kono, 2016). Marriott never
stops exploring inventive ways to serve its customers and grow its business. The company that is
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acknowledged now as one of the top employers and for the excellent business operations it
provides, initially started as a nine-seat A&W root beer stand which is based on five core values
namely- put people first, pursue excellence, welcome change, act with honestly and work for the
well being world. As of 2019, the company has 30 brands in operation internationally (About
company. 2019).
Is the strategic direction of the company sound , now and for the future?
Strategic direction refers to the measures taken to achieve the goals described by the
strategy of the organization. Having a strategic plan is vital for an organization as it not only
provides a perception of direction but also outlines goals that are quantifiable. Strategic direction
helps in setting periodic goals (short-term, medium-term and long-term) (Bentley, Omer and
Sharp, 2013). It can be in the form of either a vision statement or a mission statement to define
where the company aspires to be in the future. In simpler words, the strategic direction unites the
strategies of an organizations and provide firmness of direction. While defining strategic
direction of a company each area of the organization must be examined including all the
processes in order to obtain the most value.
Having more than 6900 hotels worldwide with over 30 brands, Marriott International is
considered as the largest hotel organization across the globe. Despite of being a 90 year old, the
company still aims for its growth and continuous improvement in the quality of services it
provides.
Marriott continues to follow the same strategy it has held since 2015 and visions to add
1,700 hotels over the next three years paying attention to customer experience. Although, the
company did not reveal the names of the brands these new hotels will be counted together.
Marriott is known for providing exceptional customer experience and what is promised at a fair
price, as a chief organization in the hospitality industry. Any misinterpretations about the brand's
products and services may lead to a costly legal action.
The brand strictly follows having a fair competition with its competitors and aspires to
compete against itself (Lieder and et. al., 2017). Employees at Marriott properties are very well
groomed, smiling and efficient. Every employee plays an important role in delivering a world
class experience to the customers. The customers pay for quality since they associate Marriott
with quality, therefore managers must pay their primary attention on the customers receiving
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experience quality in each area of service by not settling for low standards. (.Oestreicher-Singer
and Zalmanson, 2013.).
The company has a set strategic direction of investing in experimenting with home
sharing and is planning to also invest in car rentals. Marriott is looking to growing rapidly Asia-
Pacific leisure travel market as a source of long-term expansion which is sustainable. Marriott
culture comprises of dealing fairly with the customers and acting with honesty and integrity. The
brand focuses on paying attention to the little details everyday that as a result mark an impact on
the company overall. An example of the same could be paying attention to the details of the
information given by others with whom the brand interacts or has interacted in the past (Orna,
2017). This could include owners, franchisees, customers, contractors, vendors and other
associates.
Being honest and acting with integrity in all communications from financial data to
personal resumes to quality reports (Mithas, Tafti and Mitchell, 2013.). The records maintained
by Marriott are as much accurate as the data from which they are delivered. It must be ensured
that expense reports, benefit claims, invoices etc. are accurate. As of for the future, Marriott
plans to expand its branded residential portfolio by more than 70% by 2022 as both residential
real estate developers search for homes associated with its brands' names. Also, the brand is to
expand its all in one portfolio to countries like Jamaica and Curacao and Africa. With the
number of residential buyers growing globally, Marriott is all set to welcome them 'home' and
deliver them an exceptional experience.
The brand is also signed an agreement to acquire Elegant Hotels Group and is
implementing the strategy of market segmentation. Each of the products offered by Marriott are
targetted towards varied clients and customers in the hospitality market from low-end products to
high-end products (Grover and Kohli, 2013). This mix of a large variety of brands ensures that
the company meets and fulfils any desire of their customers. Earlier this year, the company
launched homes and villages with a parallel growing number of premium villas and homes all
over the world.
As of today, the company's existing hotels seem to be filling up quickly, the event
organizers are tend to have more Marriott properties to choose from in the years to come.
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Will the financial performance of the company give the investor a good return.
Financial performance is one of the most important aspect that helps to organisation in
order to observe or evaluate crucial factors that determine the financial position.
For an organisation to evaluate the performance of an organisation and the key aspect to
verify the interest area of investors some factors plays very much crucial factor that are as
follows:
The revenue of Marriott international in year 2014 is 13796 million dollar and in year
2015 it increase and reach at 14486 million dollar and gradually rises year by year respectively
17072, 22894, 20758 and 20890. so from the behalf of revenue the point of investor that they
have to invest in respective organisation as their revenue rises year by year in positive manner.
The another crucial factor which is operating income that is in year 2014 is 1159 million dollar
and gradually rises that respectively 1350, 1754, 2518, 2521 and 2230 in upcoming years. So it
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Illustration 1: Marriott International Inc Class A, 2019.

proved beneficial for organisation as well as investors in order to remain always competitive in
marketplace. So after observing all kinds of respective aspects it is evaluated that investors have
to invest their money in respective projects in order to gain potential outcomes in positive
manner.
The another major aspect for an investor which is Earning per share which is 2.60 in year
2014 and respectively fluctuating in positive manner that are 3.22, 2.68, 3.66, 5.45 and 3.91 in
past few years so it not gradually declines or not rise that is one of most potential aspect for
business in order to remain competitive in marketplace.
The another important aspect that an investor has to evaluate while investing in a
business that is market share and contribution in the economy (Smith, 2013). In context of Hotel
Marriott they have future projects for enlarge business opportunities in the market of Asia,
Europe, Middle east and African market and north America with Caribbean market in order to
remain competitive in marketplace.
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Illustration 2: Marriott to Invest $2 Billion in Global Hotel Expansion, 2019

They have top five vendor that are Marriott international, Hilton, Hyatt hotels, four
seasons holdings Inc. and Shangri La international hotel management Ltd. Their respective
global market shares are 13.59%, 6.59%, 2.53%, 2.41% and 1.24% as observed in the year 2017.
so all are very much potential for an individual to gain important aspects in order to gain
potential outcomes.
From the above graph it has been summarised that the net income of Marriott
international at worldwide level rises year by year in year it is 571 in 2012 and 626 in 2014 and
rises gradually that is respectively 753, 859, 780, 1372 and 1907 that shows positive impact on
investors in taking crucial decision making to gain potential outcomes. So all factors plays very
crucial role in aspect of individual as well as organisation by compensating the needs of business
to improve in the level of performance, infrastructural needs and some other aspects.
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Illustration 3: Net income of Marriott International worldwide from 2007 to 2018, 2019

How responsible the company is in respect of their business practices.
Business practices is defined as the ways that attempts to perform in cots effective
manner. Moreover, this is considered as the process, methods and others that is followed through
firm in pursuit of their aim (Ghezzi, 2013.). There are several business practices that Marriott
International are performing which are discussed below: Be courteous and helpful: In Marriott International, “staff have to be dressed properly,
friendly, happy and others”. The company's attitudes should propose. As their business
practices is to be respectful and helpful while serving to customers. This includes weather
they are facilitating a cleans rooms, tasty meal, each staff plays essential role to satisfy its
guest (Reich and Benbasat, 2013.). Moreover, their managers are accountable to make
assure that workers are treats its clients as they are in its home.
Corporate social responsibility: This is considered as the kinds of global private business self-
regulation which intends to contributes towards societal objectives of philanthropic, charitable
nature or activist and others (Hoejmose, Brammer and Millington, 2013.). Moreover, it is self
regulating business model which assist organisation to be socially accountable to them self,
stakeholders and public (Pham, Pham and Pham, 2016). In respective company business
practices, they continue to develop its CSR activity so it initiated two activities intent to enhance
finances as well as support SOS children's village Greece. The main purpose of this is to
maximise firm' team spirits as well as supports their CSR activities. Be Vulnerable: Vulnerability is considered as the recurring theme within Marriott
International. As it believes that managers required to stop being anonymous one in lives
of junior staff as well as which for knowing that workers is the effective ways for
administration for engaging its staff. Also, this have been observed that vulnerability as
essential in teams dynamics. This is included in its business practices as they utilise
vulnerability in its theme. Facilitates effective products as possible: This is considered as facilitating best products
to clients what they want. By focussing primarily on trends as well as liking among
tourists or passengers as well as diners, they can better serve its clients (Li and Tan,
2013. ). As, In their business practices consumers are very essential for them. Also,
consumers associate quality with them. Their guest expects that as well as pay for this.
Moreover, its manager has to observe that clients receive that quality in each field
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without comprising upon firm's higher standards. So, the respective organisation have to
focus upon the trends as well as preferences.
Keep units attractive and clean: A real efforts that have to perform is to get their staff to work in
cleanliness manner (Trevisan, 2016). In Marriott International, clean operations initiates with
individuals who perform in cleanliness manner. Either their unskilled or careless workforce and
inappropriate equipment or work atmosphere that is unorganized. Their manager have to always
focused upon why backwards or an uncleared circumstances so that they may obviate their cause
not just for cleaning up the mess but also facilitates clean areas in al manner.
Therefore, all the above mentioned business practices, this have been analysed that Yes,
Marriott International behave responsibly in context of its business practices as they are serving
their guest in effective and efficient manner (Bharadwaj and et. al., 2013. ). It facilitates full
respect to its customers and aids them in each and every way through keeping room clean, solve
their problems and issues as early as possible etc. In addition to this, they utilise vulnerability in
its theme that help them to know about their staff and involve them into work in efficacious
manner. Also, respective firm assure that their guest will get high quality products and service so
they like to visit again and again that outcomes in enhancing customers loyalty (Wieland,
Hartmann and Vargo, 2017). Also, they initiates corporate social responsibility for maximising
finances as well as support SOS village children's.
Recommendations -
From the above report, it can be said that Marriott International today will not serve to be
an advantageous option to invest in since the company's share price is quite uneasy. It can be
expected for it to sink lower or higher in the future and can give investors another chance to buy.
All of this is primarily based on the beta of Marriott International, making it a a good measure
for measuring the stock movement against the rest of the market.
CONCLUSION
Through the report stated above, it can be inferred that business strategy is very much
essential for all organisation as this help them to develop its direction and objectives. Marriott set
off to become a successful brand over the years that followed with its first Courtyard hotel
debuting lodging for business travellers. Moreover, strategic direction is vital as it assist in
setting periodic goals (short-term, medium-term and long-term) also helpful in attaining them in
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effectual and efficacious manner. In addition to this, it is crucial for organisation to be
responsible for its business practices as this aids them to behave in appropriate and efficient way
for attaining its objective as well as profitability. Also, from the financial evaluation, it is
evaluated that investors have to invest their money in respective projects in order to gain
potential outcomes in positive manner. Investor have to evaluate while investing in a business
that is market share and contribution in the economy.
Overall, the investors should not consider investing in Marriott International as it is expected to
fluctuate, i.e., either go up or sink lower in he future and may be either be of profit or of loss to
them as it depends on the beta of the company as it shows the measure of the stock movement.
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Online
About company. 2019. [Online]. Available Through:<https://www.marriott.com/about/culture-
and-values/history.mi>
Marriott International Inc Class A, 2019. [Online]. Available through.
<http://financials.morningstar.com/income-statement/is.html?
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Marriott to Invest $2 Billion in Global Hotel Expansion, 2019. [Online]. Available through.
<https://www.wsj.com/articles/SB10001424052702303703004577475383271200696>.
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international/>.
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