Global Marketing: Analysis of Expansion Potential for The Dorchester Hotel in Spain

This report analyzes the potential expansion of The Dorchester Hotel in Spain, focusing on economic, technological, and social factors. It discusses the opportunities and challenges for the hotel in the Spanish market.

Global Marketing

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Overview of company............................................................................................................3
Environmental factor of Spain.........................................................................................................4
Economic factor: -..................................................................................................................4
Technological Factors:...........................................................................................................5
Social Factors:........................................................................................................................7
CONCLUSION................................................................................................................................8

INTRODUCTION
Global marketing refers to the practices that are being performed by an organisation in order
to offer its product or services at international level. This become quite possible after
globalisation as it brings up easy access to technology, resources and knowledge that support an
organisation to expand its business and cater the need of larger number of people at global level
to achieve tremendous growth (Keegan, 2017). The current project is based on The Dorchester
hotel of London which is a glamorous five star hotel with pedigree that helps in attracting the
wealthy clientele and earns higher profitability. The current talks about the potential expansion
of Dorchester to different country i.e. Spain and for determining its feasibility it perform an
analysis of three main factors such as economy, social and technological factors that are
concerned to be most essential for business growth.
MAIN BODY
Overview of company
The Dorchester hotel of London started its operations by year 1931 within the heart of
Park Lane. It is reviewed as one of the most luxurious and expensive hotels which attract the
people specially from high class society that remain unconcerned about the expenses. It provides
a range of accommodation related services and experiences most positive feedback from its
customers which help it in maintaining its goodwill in London. But in order to achieve further
growth it is planning to expand its business within another country i.e. Spain. The main reason
behind considering it as potential market because the country is considered to be one of the most
tourist attraction destination. As a result of which most tourist can be attracted toward services,
other than this the poverty is high which help in getting cheap labour or resources. The hotel
market of Spain is expanding is expected to grow in near future it is an opportunity for The
Dorchester hotel to expand their market in Spain. It is because of the increasing number of
tourist, rapid development of the economy due to various measures taken by the government,
more of natural resources and many more.

For target market it has been decided that the hotel will target its services for mainly
tourists that are relatively higher in country with offering its accommodation services from
normal to luxury so that customers can be attracted as per their spending capacity.
But in order to perform well in new market it is crucial for The Dorchester hotel to adjust
its marketing elements effectively so that desired outcome can be achieved. For this marketing
mix of model has been consider where the services offered by The Dorchester would be room
services, parking, restaurant, bar, spa, laundry, WI-FI, fitness centre etc. Other than this, it has
been decided that the normal to luxury services would be offered to customers so that price will
be set accordingly. Such as for normal services the price will be kept at low, while for the luxury
services it would be premium and in order to get establish in marketplace it will adopt the
competitive pricing strategy (The Dorchester Hyde Park, London, England, 2020). For
promoting their existing business The Dorchester hotel relies upon word-of-mouth publicity
along with personal relations of the marketing team of the hotel with their existing clients and the
prospects.
Environmental factor of Spain
With the help of analysis of the various external factors opportunities and threats can be
identified on the basis of which the company can easily ensure their expansion strategy. The
analysis of the external factors includes identification of five important factors such as political,
economic, social, technological, legal and ecological. For expansion of The Dorchester hotel in
Spain it is important to analyse three crucial factors which includes economic, technological and
social (Junquera, 2016).
Economic factor: -
These factors includes the determinants of financial as well as economic position of the
country which is crucial to study for an organisation before moving to operate its business within
particular country as it have direct impact over an organisation’s performance. It mainly includes
several factors like tax rate, inflation and deflation, import export practices, Foreign Direct
investment, economic growth pattern and fiscal policies. These factors directly affect the price of
offering of an organisation, demand and supply of product or services as well as purchasing
power of its target market.
As The Dorchester hotel of London wants to expand its business within Spain for
increasing its customer base and diversify the market to achieve more growth and success, it

remains crucial for the hotel to firstly investigate about the economic condition of the country
thoroughly then only take up the decision regarding its expansion of business (De Mooij, 2018).
This is so because it help in determining the factors or opportunity for financial growth present in
country and how it can be effectively utilise to remain at economic advantage.
Spain is consider as the 13th largest economy within the world and its gross domestic
product are is marked as $1426.9 billion within year 2018 which is consider to be approximately
equal to 2.30% of the global economy. Other than this it has been identified that the economy of
country is experiencing a growth from last five years where it get expanded by 2.5% which is
market in year 2018. Therefore, it has been noted that the Spain is consider to be one of the
biggest contributors to the eurozone. Hence it can be said that the economy of country is growing
which is a positive factor for The Dorchester hotel by expanding its business in this country there
remains a chances of getting a financial hike in its offering of services.
Other than this Spain has faced the economic challenges between the year 2007-2014
which was a global economic recession where it had a loss of approximately 3.8 million jobs and
the wages offered to the worker get fall up to 10%. Due to this the economy of Spain has faced a
lot and not been able to recover properly till date. From a survey it has been identified that in
year 2019 the unemployment rate is around 14.2% which is marked as the second highest within
Europe. As a result of which the country is experiencing poverty and on the other side many of
the jobs are temporary that are creating the ongoing uncertainty.
These are certain issues that Spain is facing in term of its economy but for The
Dorchester hotel it proves to be certain opportunity if it expands its business within Spain. This
is so because the country is facing high poverty and unemployment which proves to be a positive
factor of the hotel (Burns, Bushband Sinha, 2014). As it easily gets the employees to perform
their work at relatively lower price which is not possible when it employee the people from its
home country. Other than this the hiring of people from Spain at cheaper rate not only help in
reducing eth cost of the hotel but also help in understanding the culture and preferences of people
which support in catering the customer base with more perfection.
Technological Factors:
Technological factors are those factors which pertain to the innovations in the existing
technology or the emergence of the new technology that has impact on the operations of the
companies in context of the processes and the methodology that they have been using. With the

help of this the companies can take competitive advantages over others as by adopting new
technology they can improve their processes thus reduces their cost which will enables them to
enhance their profitability. Due to the prevailing technological conditions of any country the
entry decisions gets affected as this directly increases the requirement of the investment (De
Mooij, 2019).
The Dorchester hotel of London is planning to expand their business in Spain as they do
not have their operation their yet and the market of the Spain is attractive due to easy availability
of the labour along with better tourism. Along with this the hotel market of Spain has grown
significantly and is expected to grow in future as well. For ensuring this various technological
conditions prevailing in the country must be analysed as with the help of this it can be analysed
that to what extend the management of the hotel need to plan to offer better services to their
customers.
In the technological terms, Spain is considered to be developing as other part of the Europe
as they have adopted all the advanced computer techniques and mobile phones along with
availability of artificial intelligence that can enables the companies to improve the satisfaction
level of the customers. In Spain, the networks and connectivity technology is strong across the
country which offers the business an opportunity to establish their business. The connectivity
among different cites through high speed trains, air and road traffic control system are efficient
which reduces the time to travel from one place to other (Guillamón, 2016). The healthcare
services of the country are quite acceptable but are not that advanced as in other European
countries. The government of Spain is promoting various technological start-ups in the country
so that they can attract other business. In addition to this Spain is the first country of EU that has
issued national identity cards to all of their citizens in electronic format. Apart from this the
people within the country are not much qualified to adopt the advance technology so frequently.
For The Dorchester hotel, technological advancement such as better connectivity of among
cities through different high quality transportation system is an opportunity as with the time to
travel will reduce for their guests. Along with this the national identity card to each and every
citizen ensures the safety and security as they can easily identify the background of each and
person while recruiting them in their oragsnaition and also this reduces the crime rates within the
country. Better advanced computer system along with artificial intelligence will enable them to
efficiently serve their customer as they can have robots for some of the services which will not

only reduces times of operations also will attract the guests to avail such services. All these
technological factors offer significant opportunity to The Dorchester hotel to establish their
business in Spain. But to lack of advance medical facilities and lack of people who have
understanding of the advanced technology they may face problem and due to this it can become
threat for them. To manage such situation they have to undertake various training sessions for the
people so that they can be made efficient enough while to manage the healthcare issues they
must have backup plans such as contact and agreement with the airlines and the hospital
emergency services etc. so that they can readily deal with such situation.
Social Factors:
The social factors describe the characteristics of the people who have been residing in that
particular country along with their customs, values, belief and norms. Such characteristics
include the size of the populations, their education level, cultural barriers, lifestyles, their attitude
and health consciousness and many more. This factors need to be analysed by the companies
while planning to expand their business as with the help of this can determine the impact of such
people of their business operations as they have to appoint the local workforce (Backaler, 2019).
The Dorchester hotel as planning to expand their business operation so it becomes crucial
for them to focus upon these factors as with the help of such factors they can determine the
suitability and impact of the local people on their operations.
In context of culture the Spain is extremely unique as the people are very friendly and easily
can talk to anybody which is not common in any European country, also the people have
different work schedule with long lunchtime breaks and late bedtimes. The demographic
condition of Spain includes 50:50 in context of biological males and biological females. The size
of the population of the country is around 46.7 million and they speak different languages such
as Spanish, Catalan and many more. The people of the country has relaxed life as their life
expectancy rates are quite high and the climate of the country is excellent along with lower cost
of living. But the country has been facing various issues such as the increasing pressure on the
health care system of the country, low incomes in the hand of the people which restricts their
economic development. In addition to this gap between the rich and the poor is consistent
because of lower income and less opportunities to the people.
On the basis of various social factors of Spain it can be analysed that for The Dorchester
hotel it is favourable to execute their plan of establishing hotel in Spain. The lower income with

the countries is an opportunity for them to have abundant labour in comparatively cheaper rates
which will enable them to reduce the overall cost of the operations of the hotel. The people of the
country are friendly and can interact with other people efficiently which is must in an hospitality
sector and this will be favourable as with they can ensure that their customers will get better
services because they can guide them, take feedbacks from them on regular basis. It will make
management of The Dorchester hotel to improve their services on regular basis as per the
requirement of the customers. Also the excellent climate of the country will attract more of
tourist and this will enables them to serve with their service. All these social factors have
positive impact on the The Dorchester hotel that offers them opportunity to expand their business
easily to the country. But the high expectancy rates within the country can adverse impact as
with this the requirement of the new employees will be restricted and this will leads to inefficient
employees as new employees with better talent and capabilities will not be employed.
CONCLUSION
It is concluded from the above report that for the organisations it is important to analyse the
business environment efficiently of the market they are planning to enter into. With this they can
determine all the opportunities and threats that they have in that particular market. The economic
factors enabled to determine the unemployment rate, poverty, tax rates within Spain on the basis
of which the monetary benefits to the business can be analysed. While with technological factors
the efficiency in the services to the customers can be determined along with the level of
competition. Apart from this the social factors enables the management of the hotel to
understand the impact of various population on the services of the hotel. By identifying the
opportunities and threats the company can easily take decisions upon whether to continue with
the expansion plan within the same geography or not.

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