Marketing and Consumer Retention in the Hospitality Industry

This document discusses marketing management philosophies, promotional mix, and marketing communications strategy in the hospitality industry. It also provides insights into the marketing plan for Mandarin Oriental Hyde Park, London.

Marketing and consumer
retention in the hospitality
industry

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
1. Marketing management philosophies for Mandarin Oriental Hyde Park, London and
examples of examples of the principles of marketing, corporate social responsibility, and
ethics............................................................................................................................................3
2. Promotional Mix and marketing communications strategy.....................................................6
3. Marketing Plan.........................................................................................................................8
SUMMARY AND CONCLUSION..............................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
Marketing can be defined as an activity of a company for promoting buying and selling
of their products and services. Marketing is one of the most important part of an organization as
it helps them to enhance their overall sales in order to increase revenue and profit (Gade and
Ankathi, 2016). Marketing is one of the most important function of an organization that helps
organizations in increasing awareness about their products and services among their customers
(Palmatier and Crecelius, 2019). In order to succeed and gain competitive advantage it is
important for organizations to analyse and apply marketing management philosophies, principles
of marketing, fulfil their corporate social responsibility and ethics in order to increase sales of
their products and services. Most of the firms develop their own marketing plan by integrating
their marketing communication strategies and promotional mix. This assignment will lay
emphasis upon marketing of Mandarin Oriental Hyde Park, London and development of
marketing plan of Hotel de 5 estrellas. Mandarin Oriental Hyde Park, London is a five- star hotel
located in Knightsbridge district of London that was opened in 1902 and reopened in year 2000
with complete renovation.
MAIN BODY
1. Marketing management philosophies for Mandarin Oriental Hyde Park, London and
examples of examples of the principles of marketing, corporate social responsibility, and
ethics
There are five major types of marketing management philosophies that are used by
organizations as it helps business to guide their marketing efforts (Lancaster and Massingham,
2017). Five main types of marketing management philosophies that are used by businesses that
can help Mandarin Oriental Hyde Park, London for guiding their marketing efforts are as
follows:
Production concept: This concept is based upon an assumption that customers prefer products
and services that are widely available and inexpensive. It further says that supply creates its own
demand therefore most of the company’s focus upon producing more products and services and
making it available to customers easily and everywhere (Palmatier and Crecelius, 2019). This
philosophy works only when demand is more than supply. Factors that can influence purchase
decision of customers are: when branches of company are spread globally can use this approach,
companies have monopoly advantage, and when demand of product is more than its supply
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(Visconti, Peñaloza and Toulouse, eds., 2020). Mandarin Oriental Hyde Park, London uses this
concept as demand of their products and services especially demand for accommodation is much
more as compared to its supply so due to this, Mandarin Oriental Hyde Park, London Hotel apply
this production concept on their accommodation product.
Product concept: This concept works on an assumption that customers prefer products of
greater quality, and price and availability does not influence purchase decision of customers.
This concept is directly applied by Mandarin Oriental Hyde Park, London devotes most of their
time developing products and services of high quality (Bagozzi and et. al., 2018). As Mandarin
Oriental Hyde Park is a five-star hotel so in order to attract more customers and enhance their
overall sales they need to maintain high quality of their rooms for accommodation, food and
beverages that are directly served to customers in a proper and appropriate manner. They have
divided their rooms and other facilities according to price preference of customers so that they
can maintain overall quality of their services accordingly.
Selling concept: This concept focuses upon making an actual sale of products and services. this
concept focuses upon making every possible sale of products and services offered by
organization regardless of quality of products and needs of customers. It can also be said that
main focus of this concept is to make money (Franzoni and Ait Allali, 2018). As Mandarin
Oriental Hyde Park, London is a five- star hotel so in order to fulfil needs of their customers,
gain competitive advantage and maintain overall reputation they need to make money by selling
their products and services but still they do not use this concept completely because this concept
do not focus upon maintaining relationship with customers, on the other hand Mandarin Oriental
Hyde Park specifically focuses upon maintaining relationship with their customers. So, they do
not purely focus upon adopting this concept only for sales of their product and services.
Marketing concept: This concept focuses upon a fact that customers or consumers buys
products that fulfil their needs and requirements in a proper and appropriate manner (Glonti and
et. al., 2020). by focusing upon this concept organizations can build and establish strong
relationship with their customers and gain competitive advantage. By focusing upon this concept
organizations can maintain their brand image and reputation and can also enhance their overall
profitability. Out of all the other concepts and philosophies this concept is directly used and
adopted by Mandarin Oriental Hyde Park, London as it helps them to maintain strong
relationship with their customers, stay in the market for long time period and compete with their
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top competitors as well as enhance their overall profitability and revenue. This concept or
philosophy is strong adopted by this hotel as it not only helps them in sales of their products and
services but also helps in maintaining competitive advantage, brand image, increase sales and
maintain relationship with customers.
Social marketing concept: When an organization focuses upon society well being as well other
than fulfilling customers needs than it is known as social marketing concept (Ferrell and et. al.,
2019). Using this concept organizations can fulfil customers’ needs without harming customers’
needs without harming environment, society and natural resources. Nowadays most of the travel
and tourism industry organizations are focusing upon adopting this concept as it helps them in
attracting a greater number of customers (Palmatier and Crecelius, 2019). Like Mandarin
Oriental Hyde Park, London is slowly focusing upon using this philosophy as a holistic approach
for attracting more customers and retaining their current customer base. Many organizations like
Mandarin Oriental Hyde Park, London use this concept in order to fulfil their corporate social
responsibility and for maintaining ethics within their organization.
Example of principles of marketing: examples of principles of marketing of Mandarin
Oriental Hyde Park, London can be explained with the help of marketing mix 4 P’s.
Product: Main products and services offered by Mandarin Oriental Hyde Park, London Holtel
are: rooms for accommodation, food and beverages, Banqueting rooms, Conference facilities,
health and wellness facilities, travel desk, housekeeping services etc.
Price: Mandarin Oriental Hyde Park, London Holtel uses price skimming strategy for pricing
their products and services and bring variation within their prices of their products and services
as per changing season and market like in peak season their prices are high whereas in off
season, they offer various kinds of discounts, offers, coupons etc.
Place: Mandarin Oriental Hyde Park hotel is located in London. They have their presence on
both online and offline places like they have their own website. Customers can make booking
online though travel and tourism applications as well. Customers can make booking though
offline modes as well like though direct phone calls, emails etc.
Promotion: they have their own sales and marketing department that focuses upon developing
and implementing appropriate and effective promotional strategies for promotion of their
products and services. some of the main promotional channels used by Mandarin Oriental Hyde
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Park, London Holtel are: brochures, hotel website, social networking sites, search engine
marketing and advertisements etc.
Example of corporate social responsibility and ethics: One of the main examples of
corporate social responsibility and ethics of Mandarin Oriental Hyde Park, London Holtel are:
reducing their carbon footprint by reducing their carbon emission, they also focus upon doing
charities (Palmatier and Crecelius, 2019). They have also focused upon environment friendly
practises like implementing solar heaters, solar panels for electricity.
2. Promotional Mix and marketing communications strategy
The promotion mix is basically considered as the integration of personal selling, public
relations, sales promotion, advertising and direct marketing. In order to have balance blend of
these above mentioned promotional tools, the marketers need to lay emphasis on the following
points including the ways in which the customers are informed regarding the products and
services of the company, the marketing methods which are used, the people to whom the efforts
of promotion are directed, the marketing budget and the allocation of budget to the promotional
tools. Therefore, the promotional mix deals in combining the channels, tools and the processes
used to promote the offerings of the company. This mainly focuses on the channels used to reach
the customers and the frequency of the communications (Dileep and Mathew, 2017). It is the
responsibility of the marketer for finding the right promotion mix for a specific brand. There are
various elements of promotional mix which are advertising, personal selling, public relations,
sales promotion and direct marketing.
The Mandarin Oriental Hyde Park (MOHG) considers the promotional mix as the various
different methods which are used to communicate the marketing message of the company such
as public relations, direct marketing, personal selling etc. The hotel uses a perfect combination of
all these marketing messages for developing the inclusive program for marketing. In order to
become the customer focussed hotel, MOHG makes use of all the elements of the promotional
mix. The company uses this for informing the customers regarding the excellence of the hotel.
The logo of the hotel is also known worldwide and the chain used all the innovative promotional
strategies for earning high and discerning travellers (Mandarin Oriental Hyde Park London,
2021).
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The main marketing objective of MOHG is making personal communication with the staff
and the customers. The company strived much hard to make effective interaction with the
customers so that they can feel special and also builds stronger relationship with them
internationally (Hilal, 2019). The hotel values the choices of the customers and offers them those
deals and the services accordingly so that the brand reputation can be increased.
MOGH ensures that the customers do not doubt their purchase after making purchase with
them and they do not think of switching to other brands at any stage of the purchase. The
company strives very hard to assure the customers that they have made the correct choice to
make purchase with MOGH which increases the confidence of the customers as well as
improving the brand image.
The Mandarin Oriental Hyde Park which is known by MOHG also makes use of social
media and the social networking sites such as Twitter, Facebook and YouTube for creating the
feeds of the hotel. The company considers this as the most cost effective way to expand the
services and products to new customers which is very difficult to reach to the customers and
motivate and convince them to make purchase. The company do not stop with this medium only
but also MOGH created a mobile app which can facilitate the customers by doing the booking,
reserving the rooms and also they become able to be aware of the offers provided by the
company on their mobile phones also which is very easier for the people who genuinely wishes
to book hotel (Marketing and Promotion at Mandarin Oriental Hotel Group, 2020).
MOGH is considered as the marketing oriented company which does the thorough analysis
of the market for promoting the business accordingly through social media and also focuses on
meeting the needs of the customers. The websites such as Expedia and Trip advisor can help the
company for stimulating the demand. The customers also provide the positive feedbacks on the
social networking sites which help in convincing and changing the decisions which leads to the
customers purchasing services from MOGH. The company performs its operations in many
different countries across the world (Foroudi, 2019). The company can make use of its website
for promoting the London hotel as it was observed that in the same year Olympic were going to
be held in London so there would be many people coming to enjoy the Olympics so the company
made use of the time and situation are started promoting the hotel of MOGH in London. MOGH
got the answers of so many questions by making use of social media.
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MOGH being a very important part of hospitality industry of UK prefers word of mouth
recommendations also as an effective marketing tool as it can help the company to increase the
customer base by listening to the reviews of others who have already made the purchase with the
company. This was also observed that the people started creating the positive image for the
company if they have heard something positive for the same. Though this is not always true that
the customers change their decisions by believing on the word of mouth recommendations as
they did not sometimes agree with the things said by others and they are not sure about the
services provided by the hotel. The company MOHG also use the celebrities for marketing as it
is considered as an effective marketing tool (Ng'Ang'A, 2017). The celebrities when recommend
any hotels to stay then the people are automatically attracted to the same so the company tried to
describe its services through the celebrities which appealed to the target audience of MOHG.
This is how, the Mandarin Oriental Hyde Park which is in London strives hard to
undertake the marketing actions for fulfilling the CIM definition of the marketing which stated
that the companies identify anticipate and tries to satisfy the customer needs along with earning
profitability. The company also analyse its competition in the market in which it operates or will
operate. This helps in gaining greater competitive advantage among its leaders and to become the
market leader in the hospitality industry. MOHG analysed the elements of the promotional mix
for satisfying the needs of the consumers regarding the luxury hotels. The company also made its
processes and ways of doing things updated according to the advancement in the technology.
3. Marketing Plan
Marketing plan is basically a report which helps in outlining the marketing strategies for
the coming time which can be year, month or quarter. It is considered as the operational
document which mainly highlights the strategies of the organisation which are implemented for
generating leads and reaching its target market. Complete research of the market is done in order
to analyse the macro-environmental factors and its impact on the business. It mainly highlights
the target market, brand value proposition, metrics used for assessing the effectiveness of market
initiatives and the campaigns to be initiated. The marketing plan for the proposed business in
hospitality industry which will be named as Parador which will be established in UK is given
below:
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Executive Summary
Parador is basically a representative of the brand of five star exclusive business hotels group in UK. All the hotels
are luxury properties among which each offers 25 to 35 exclusive rooms. It is renowned for its strategic and
convenient locations in the major cities of the country. The hotel provides quality products and services to its guests
and the tourists. The hotel owner as well as the workers is completely dedicated towards fulfilling the needs of the
guests and the tourists. The main objective of the company will be communicating the unique services which the
company offers for discern the guests of the hotel. The main goals are continued differentiation and growth which
will be possible by targeting the new business areas locally and internationally.
Objectives
Financial objectives
 To increase the overall room revenue by 20% till the end of the year 2021.
 To increase the corporate contracted rates for returning the confidence in the hospitality
industry.
 To keep the payroll expenses down and reducing the level of overtime among the
workers.
 To accomplish the growth within the available budget.
Marketing objectives
 To continue communicating the strategic objectives to the target markets.
 To provide a memorable and positive hotel experience to the tourists and the guests.
 To accomplish the targets of growth in the given budget and time (Fotiadis, Mombeuil
and Valek, 2018).
 To expand the market by identifying new markets for products and services.
Situational Analysis
SWOT analysis
Strengths: The major strength of the hotel is its established differentiation strategy and flat decentralised structure.
The staff and the management of the hotel are highly qualified and skilled which makes the culture strong and
participative. The staff of the hotel are trained and dedicated towards promoting the brand which helps in
communicating the shared valued more effectively.
Weaknesses: The major weakness associated with the differentiation strategy is that it must be well and clearly
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communicated in the local as well as national markets. The company needs to improve the interdepartmental
communications. There is also seasonal turnover which needs regular training of the staff and the orientation of new
employees (Innanmaa, 2020). Various rooms need renovation and some up gradations such as internet access.
Opportunities: The Company has long term and strong relationships with the suppliers which will help in
facilitating the employees with the required resources and the customers with quality products and services. The
company can expand itself and its services in new areas in new environment may be small but luxurious.
Threats: The competitors such as Hilton, Marriott, Hyatt etc. can become the major threats for Parador. The
recovery from slight recession will take time which will prove to be a threat for the company.
PESTLE analysis
Political: These include travel bans, tax reforms and also the elections which affect the operations of the hotel. The
policies and the restrictions made by the government of the country in which it operates must be kept in mind before
developing strategies.
Economic: These include the weakened currencies, tailored offerings and economic cycles which affect the pricing
strategy of the company.
Social: The customers in UK wanted cheaper hotels with all the required facilities like pools, rooms, gym, massage
parlour and many more in their budget.
Technological: The Company must also make use of the advanced technology in the marketing process also such as
social media, scratching reviews, websites and the blogs which can help in attracting the customers.
Legal: The hotel must adhere to the laws and regulations imposed by the government such as truth-in-menu laws,
innkeeper laws etc. in order to increase its goodwill and the customer base (Aleksandrova Georgieva, 2017).
Environmental: The local climate also affects the hotels so the company must be prepared for all the climatic
changes which will help in providing warm and relaxing atmosphere to the guests.
STRATEGIES AND TACTICS
Segmentation, Targeting and Positioning
Parador must make segments by following the demographic segmentation which is on the basis of age, gender,
income, nationality etc.
It must target the families and the people coming for business purposes which will help in maintain the decorum of
the hotel without ruining its image.
It must position itself on the positioning map by analysing the segment to be targeted which can help in enhancing
the profitability (Leite and Azevedo, 2017).
Marketing mix strategies
Products: High quality facilities differentiated by the competitors.
Pricing: Affordable pricing must be decided to attract the guests of all class and income.
Promotion: Online promotions must be used through advertising on social networking sites, websites etc.
Place: Personal selling, advertising, internet, direct marketing along with the delivery channels including the travel
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agents.
Finance and Budgeting
S.No. Particulars Amount (in £)
1. Market research 800
2. Traditional advertisements 1000
TV And broadcasting 200
Direct mail 100
Print ads and Promotional brochures 300
Banner advertisements and hoardings 300
Promotions and discounts 100
3. Online marketing 1000
Social media marketing 100
Endorsements 200
Web advertisements 200
Database marketing 200
Miscellaneous 300
Total expenditure £ 2800
Measurement and Control
MARKETING METRICS:
 Return on marketing investment (ROMI)
 Analytical tools and techniques: Attribution tools, web analysis, Mobile analytics, campaign automation,
social analytics and tag management.
 Bottom line performance and Contribution Margin
 Key performance indicators
KPI:
 Increase in profit and Sales revenue
 Inbound marketing return on investment
 Customer Lifetime value
 Customer Acquisition costs
 Social media traffic and conversion rate
 Abandonment rate
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SUMMARY AND CONCLUSION
From the above assignment it has been summarised that marketing is one of the most
important function of an organization. For a travel and tourism industry organization it is
extremely important in order to attract customers and enhance their overall sales. Development
of an appropriate marketing plan help hospitality organizations in developing a strategy through
which they can increase awareness about their products and new services offered by them in
order to attract more customers. It has also been summarised that in order to develop an
appropriate and effective marketing plan it is important for hospitality industry organizations to
understand different kinds of marketing management philosophies, principles of marketing,
ethics, corporate social responsibility etc. as it directly helps them in understanding main factors
and concepts that are required to be focused upon by them for development of an effective
marketing plan for enhancement of sales of their products and services. It has also been
summarised that it is important for hospitality industry organizations to integrate promotional
mix with marketing communications strategy so that a greater number of customers can be
attracted. This can directly help organization to develop an effective and appropriate marketing
plan that can help them to boost their overall sales, enhance customer base and gain competitive
advantage as well as enhance positive brand image.
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REFERENCES
Books and Journals
Aleksandrova Georgieva, A., 2017. Digital marketing plan: Ecoral Hotel.
Bagozzi, R.P., and et. al., 2018. Marketing-Management. Walter de Gruyter GmbH & Co KG.
Dileep, M.R. and Mathew, V., 2017. Marketing of tourism industry: enhancing services through
marketing mix elements. In Strategic Marketing Management and Tactics in the Service
Industry (pp. 304-329). IGI Global.
Ferrell, O.C., and et. al., 2019. Business ethics, corporate social responsibility, and brand
attitudes: An exploratory study. Journal of Business Research. 95. pp.491-501.
Foroudi, P., 2019. Influence of brand signature, brand awareness, brand attitude, brand
reputation on hotel industry’s brand performance. International journal of hospitality
management. 76. pp.271-285.
Fotiadis, A., Mombeuil, C. and Valek, N.S., 2018. Designing and implementing a marketing
plan. In The Emerald Handbook of Entrepreneurship in Tourism, Travel and
Hospitality. Emerald Publishing Limited.
Franzoni, S. and Ait Allali, A., 2018. Principles of Islamic finance and principles of corporate
social responsibility: what convergence?. Sustainability. 10(3). p.637.
Gade, J. and Ankathi, R., 2016. Tourism management philosophies, principles and practices.
Zenon Academic Publishing.
Glonti, V., and et. al., 2020. Socialization of organization sustainable development based on the
principles of corporate social responsibility. Montenegrin Journal of Economics. 16(1).
pp.169-182.
Hilal, M.I.M., 2019. The effects of services marketing mix elements on brand equity and
customer response to tourists hotels in the east coast of Sri Lanka.
Innanmaa, K., 2020. A strategic marketing plan.
Lancaster, G. and Massingham, L., 2017. Essentials of marketing management. Routledge.
Leite, R.A. and Azevedo, A., 2017. The Role of Digital Marketing: A perspective from Porto
Hotels’ Managers. International Journal of Marketing, Communication and New Media.
(2).
Ng'Ang'A, D., 2017. The Significance of Unique Selling Proposition on Consumer Purchasing
Decisions in Hotels.
Palmatier, R.W. and Crecelius, A.T., 2019. The “first principles” of marketing strategy. Ams
Review. 9(1). pp.5-26.
Visconti, L.M., Peñaloza, L. and Toulouse, N. eds., 2020. Marketing management: A cultural
perspective. Routledge.
Online
Mandarin Oriental Hyde Park London, 2021. [ONLINE]. Available through: <
https://www.mandarinoriental.com/london/hyde-park/luxury-hotel/accommodations>
Marketing and Promotion at Mandarin Oriental Hotel Group, 2020. [ONLINE]. Available
through :< https://www.greenontheinside.net/marketing-and-promotion-at-mandarin-
oriental-hotel-group-essay-example/>
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