Shangri-La Hotel Business Expansion Strategy

This assignment focuses on developing a strategic plan for the expansion of Shangri-La Hotel Sydney. The core element is the introduction of a new, exclusive suite designed to attract premium customers. The strategy encompasses aspects such as innovative suite design, advertising campaigns in luxury publications and airports, process improvements through automation, and establishing partnerships with airlines and corporate entities to secure a new customer segment.

IMC of Shangri-La Hotel, Sydney
Assessment 3 Business Portfolio
Student Name: Student ID:
Subject Name: The Hospitality and Tourism Market Subject Code: HAT202
Date Due: Professor Name:
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Abstract
Corporations make use of varied communication plan for marketing endeavors. Such
communications enable creation of brand identity for the corporation and generate greater brand
awareness attracting customers. The scope of the current analysis deals with IMC for Shangri-La
Hotel, based in Sydney in Australia. The report describes it current IMC plan along with new or
recommended idea that can allow the hotel creation of a unique segment in the market.
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Table of Contents
Abstract............................................................................................................................................2
1.0 Summary of Hospitality Sector.................................................................................................4
2.0 Current Business Operations.....................................................................................................5
3.0 Recommended Future Campaign..............................................................................................8
4.0 Recommended New or Innovative Idea....................................................................................9
Reference Lists..............................................................................................................................11
Table of Figures
Figure 1: Shangri-La, Sydney......................................................................................................................6
Figure 2: Location of Shangri-La................................................................................................................7
Figure 3: Pricing of the Hotel......................................................................................................................8
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1.0 Summary of Hospitality Sector
Tourism and hospitality has become an ever-growing sector with current trends depicting a 3%
of the Australian economy (Brennan, 2007). The hospitality sector is expanding at a continuous
rate with 8.9 million visitor arrivals on a regular basis, employing a large segment of the
population amounting to about 600,000 people. The scope of this report deals with IMC of
Shangri-La Hotel at Sydney along with new and innovative offering. The hospitality sector in
Sydney being a prime location at Australia is highly competitive in nature with various
multinational hotels, home stays, boutique hotels and other similar stays (Keller, 2009).
Hospitality sector within Sydney offers a highly competitive scape with multiple hotels offering
varied packages for their customers. A number of other associated benefits as free transfers often
accompanies offerings at the hotels to airport, breakfast and so on. These hotels are also offering
varied cuisines at the hotels such as to attract a large domain of tourists. Suppliers in this industry
have relatively moderate bargaining power as they value their tie-ups with a number of large
hotels (Shimp, 2007). However, customers have a high bargaining power as they are offered with
a large number of choices in this domain. With ease of norms for operating business across
national boundaries there are a large number of hotels who are planning to expand in Sydney.
Hotel chains from countries outside of Australia are planning to set up their operations in the
country due to its high influx of tourists, this is creating immense threats for existing hotels from
new entrants (Finne, 2009). New hotels setting up in the country will offer their rooms at cost
competitive rates which will create further challenges for the existing hotels. Now with several
people offering home stay facilities competitive forces in the industry have increased further.
Home stays as Airbnb are offering competitive landscape for competition in the industry leading
to existing hotels designing a new or innovative product offering for their customers or an
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enhanced marketing communication plan. Shangri-La at Sydney is a hotel that offers stays for
customers at its hotels and this report encompasses development of a new and innovative idea
that can attract larger number of customers towards its hotel.
2.0 Current Business Operations
Shangri-La hotels is one of the most well-known hotel chains located at various places of the
world (shangri-la.com, Retrieved on 8th October 2017). The hotel is also located at 176
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Cumberland Street, Sydney at Australia. The hotel is one of the most sought after location and
property at Sydney. It offers premium rooms and hospitality for its customers at competitive
rates.
Product: The hotel is a high rise luxury hotel with good rooms having great views. Each room
and suites have all luxurious facility of flat-screen TV, Wi-Fi connection, marble bathrooms,
minibars. Almost every rooms offer views of Grand Harbor and Sydney Opera House. It offers
its customer facilities as indoor pool, a hot tub, Asian-themed spa, fitness room, fine dining
restaurant along with a cocktail lounge facility.
Figure 1: Shangri-La, Sydney
Location and Distribution: The hotel is located at a prime location which is almost 5 minutes’
walk from Museum of Contemporary Art Australia, a kilometer from Sydney Opera House and 7
minutes’ walk from Circular Quay train station. It caters to an increasing number of customers
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from all over the world. It receives a varied type of visitors including business travellers, tourists,
musicians, industrialists and so on.
Figure 2: Location of Shangri-La
Pricing Models: The hotel follows competitive based pricing methods for its rooms and other
amenities. The hotel has its tie-up with various online booking methods, as Hotels.com,
Booking.com, Amoma.com, Otel.com, Agoda.com, priceline.com and so on. Rooms can be
booked through its own official website as well, which is Shangri-La.com. These websites along
with its own website offers competitive rates based on seasonality and combining offers to
maintain optimum occupation at the hotel (Kitchen, 2008). Thus, the hotel follows competitive
based pricing methods to compete with similar hotels in the scape.
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Figure 3: Pricing of the Hotel
Customer Segments: The business caters to various segments of customers (Bailey, 2009). It
caters to customers high-income levels who are primary business based or tourists. It caters to
both genders and middle income level group of customers. Its premium levels of customers are
some regular loyal customers who avail facilities at the hotel.
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Branding and Positioning: The hotel is positioned as a premium brand and positioned at a top
level in the market segment (Mulhern, 2009). The branding of the hotel world over is that of a
premium brand positioned just after Hilton and Marriot.
Current Promotion: The hotel’s tie-ups with major online travel portals and airlines have
allowed it to generate significant inflows of customers. Its current promotional strategies
includes advertising through traditional modes as poster, banner, television and radio
commercials. It has also accommodated contemporary modes of advertisements as digital
advertising, social media advertising and so on.
Marketing Materials: It primary marketing materials include materials for banners, posters,
matter for social media and pictures of the hotel along with its rooms. Customer books rooms at
the hotel viewing its reviews online. The hotel has managed to receive positive feedback and
review for its rooms as well as its hotels.
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3.0 Recommended Future Campaign
Hotel Shangri-La, Sydney in order to attract a large number of customers towards its hotel rooms
and cuisines that it offers. It already has an existing marketing campaign aimed at targeting its
customers worldwide who visit Sydney in Australia (Andrews, 2017). A scope for creating a
better marketing campaign exists, which needs to include the following recommended strategies
as below;
Traditional Media: While adopting new and contemporary ways in marketing, the Company
should not do away with traditional mechanism of marketing (Kerr, 2008). The hotel should aim
at banner advertisements at airports and other key locations across the city. At various locations
the hotel can include signboard showing its way to the hotel.
Print: The hotel can resort to print media form of advertisements as newspapers, coverage
regarding its renovation or additional features at its hotels in key magazines and so on. The hotel
can also print banners and put it up at key locations which includes their discount related offers.
Digital Plans: Contemporary tourists as well as business travellers books their hotel rooms at
Sydney mostly through online reservation systems (Gurău, 2008). The hotel needs to assure a
safe booking through its own website and suitable printable voucher generation. For furthering
its digital plans, the hotel needs to make tie-ups with several online portal available that can
boost its online presence. The hotel has large accommodation facilities can allow sizable number
of rooms to such booking portals.
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Website: The hotel already has a website that attracts customers. It can attain SEO and SEM for
its own hotel website such that its can easily attract a large number of customers towards it hotels
in the segment (Morgan, 2007).
Social Content: The hotel is not very active across its social media hence such endeavors need
to opted by the hotel. The hotel needs to regularly update its social media content such that
customers loyal to the hotel can understand any additional new features or discounts that are
being offered by it.
Blogs: The hotel does not yet have a blog of its own unlike others in the hospitality chain. Thus,
it needs to create a blog and keep its viewer constantly posted regarding the various whereabouts
that are taking place (Bruhn, 2006). Blog readers will be attracted towards any new posts created
which will further allow the hotel to gain ranking for its blog or website also, increasing the
number of visits.
Email marketing: While customers check-in at the hotel they are providing a detailed record of
ways to contact them. The hotel can attempt to make email marketing at a bulk to various
existing as well as other customers regarding its offers, discounts and so on. Email marketing has
gained quite a lot of importance in recent years as being one of the key ways of attracting
customers.
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4.0 Recommended New or Innovative Idea
The hotel has already being able to attract a sizable number of customers. It has a brand identity
and a brand name that attracts customers from all world over visiting Australia. However, the
hotel’s management is keen on devising a new or innovative idea that can help generate a
greater brand name for the Company. Such new idea will act as a thriller or impetus to attract
new customers towards the hotel brand.
Product launch upgrade: The hotel can aim at launching a sky terrace based rooms. Such
terrace rooms will give direct view of the Opera House of Sydney. It will be a latest attraction
though it will involve substantial amount of construction works but it will be worth the
investment. The entire room will be built with glass made from bullet proof shielding and
customers staying in the rooms will have a view of almost entire Sydney. It will give a feeling of
staying in the sky as it will have a considerable amount of height.
Line extension: The newly designed room will involve substantial amount of costs will be a
product line extension for the hotel’s business line. This line extension for the hotel’s business
will thrill customers and will be able to create a niche in the business which no competitors will
be able to offer.
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New Advertising Avenue: In order to advertise its newly built suit it will advertise in some
leading hoardings around the city. It will advertise at airport VIP lounge, leading airways
magazines and also at several key locations around the world.
Process Improvement: The hotel will aim at not only designing new and innovative suites but
also improvise various processes. The hotel now has several of its processes done by humans that
can be transformed into mechanical processes. As cleaning of rooms are still done by staffs in a
physical manner that can be done by way of mechanical processes. Such mechanical processes
will aid development of better and cleaner rooms within the hotel.
New Customer Channel: The hotel through designing of this exclusive room will aim at
attracting a new customer channel altogether. The hotel will aim at attracting premium segment
of customers through such room designing. It will also aim at making tie up with airlines such as
Qantas and Virgin such that they can accommodate their key business class or first class
passengers in those rooms. It will also attempt tie-ups with several corporate houses such that
they are able to receive bookings from them for their guests at key management people. This
new channel of customer for the hotel will be able to attract more number of customers influx
into the hotel. It will require to recruit new chefs, customer care representatives and staffs for
these new customer segment.
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Reference Lists
Andrews, J. C. 2017. Advertising, promotion, and other aspects of integrated marketing
communications. Nelson Education.
Bailey, C. B. 2009. Segmentation and customer insight in contemporary services marketing
practice: why grouping customers is no longer enough. . Journal of Marketing Management,
227-252.
Brennan, R. B. 2007. Contemporary strategic marketing. . Palgrave Macmillan.
Finne, Å. &. 2009. Rethinking marketing communication: From integrated marketing
communication to relationship communication. Journal of Marketing Communications, 179-195.
Gurău, C. 2008. Integrated online marketing communication: implementation and management.
Journal of communication management, 169-184.
Keller, K. L. 2009. Building strong brands in a modern marketing communications environment.
Journal of marketing communications, 139-155.
Kerr, G. S. 2008. An inside-out approach to integrated marketing communication: An
international analysis. International Journal of Advertising, 511-548.
Kitchen, P. J. 2008. Integrated marketing communications: Practice leads theory. Journal of
advertising research, 531-546.
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Morgan, B. 2007. Integrated marketing communication. International Business Review.
Mulhern, F. 2009. Integrated marketing communications: From media channels to digital
connectivity. Journal of marketing communications, 85-101.
shangri-la.com. (Retrieved on 8th October 2017). Hotel Details.
http://www.shangri-la.com/sydney/shangrila/about/.
Shimp, T. A. 2007. Integrated Marketing Communication in Advertising and Promotion/por
Terence A Shimp (No. 658.8 S45.).
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