Macro and Micro Analysis of Hotel Marriott: PESTLE and Porter's 5 Forces Model

This presentation provides a macro and micro analysis of Hotel Marriott using PESTLE and Porter's 5 Forces Model. It discusses the impact of political, economic, social, technological, legal, and environmental factors on the hotel industry. It also analyzes the bargaining power of suppliers and buyers, intensity of existing rivalry, threat of substitutes, and threat of new entrants using Porter's 5 Forces Model. Additionally, it identifies the strengths, weaknesses, opportunities, and threats of Hotel Marriott using SWOT analysis. Finally, it highlights the major challenges faced by the hotel in developing its marketing activities.

Marketing
Management

MACRO ANALYSIS
•PESTLE Analysis of Hotel Marriott
•Political: Change in government has a greater impact on Marriott hotel as new
government will impose new regulations and thus, Marriott has to change its policies
accordingly. Further, political conflicts create disturbance in the working of hotel.
•Economical: Recession has its major effect on the hotel sector because it indicates
that fewer customers have disposable income and staying in hotel for leisure is
becoming less popular. Fluctuation in exchange rate is imposing threats because
people restrain themselves to visit those countries with higher exchange rates.
•Social: It is known that people from diverse culture are traveling to UK and other
countries. In coming years, diverse cultural people will travel and expect that similar
environment related to their home country will be provided to them by the service
providers of host country. Thus, Hotel Marriott has to take extra care for this purpose. It
has to employ diverse cultural personnel to match with the future trends.

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•Technological: Technological changes have provided greater
opportunities to customers and hotel management as well. Hotel has to
become technologically driven such as complete automation so that
customers do not have to depend on hotel staff. To meet out the needs of
customers, hotel management has to bring necessary changes.
•Legal: It is known that Marriott hotel has been expanded its business in
the international market and has to obey the laws of all the countries
where it operates. Thus, changes in laws and other international legal
rules have a greater impact on the working of hotel. Recent changes in
health and safety inspection have created interference in the HR policies
and practices of hotel.
•Environmental: Increment in fuel cost has reduced the number of
travelers which is impacting the business of Hotel Marriott. Further, global
warming can affect the ski resorts and some beach resorts because it will
become too hot for comfort.

MICRO ANALYSIS
•Porter's 5 Forces Model
Bargaining Power of Suppliers High competition level among suppliers leads to
price reduction.
Diverse distribution channels result in less
bargaining power.
Bargaining Power of Buyers There are so many competitors present in the market.
Customer are in large number thus, leads to high
bargaining power.
Switching cost is low.
Intensity of Existing Rivalry There are many firms which reflect high rivalry
among competitors.
Threat of Substitutes Substitute threat is lower because Marriott is a
leading hotel and other firms provide inferior quality
services than Marriott.
Threat of New Entrants Low threat.
Huge capital investment is required.
Industry requires economies of scale.
Advanced technologies are required.

INTERNAL ANALYSIS
•SWOT Analysis
•Strengths
Leading hotel among its competitors.
It has more than 3700 hotels and resorts in over 70 countries.
High brand recognition in the whole world.
Employee retention system is good and it has 150,000 employees.
Technologically upgraded business process which provides innovative services to
the customers.
Weaknesses
Facing competition from long established hotel chains.
It has little focus on the Asian markets.
Management system is getting poor due to huge extended business.
It is facing the issue of high debt.

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•Opportunities
Hotel Marriott should get merge with other leading businesses in the UK market.
India and China are the emerging markets where it can expand its business.
It can bring more innovations in customer service through using new technology.
Hotel management can link with tour operators and travel agents for increasing their
number of visitors.
Threats
Increasing competition on price points.
Stagnated growth of Hotel Marriott.
Political imbalance and changing international laws create difficulties for Marriott to
work in an environment of UK beacuse new government bring new rules and
regulations which impact their working beacuse orgnanizational policies and structures
required to be change accordingly. On the other hand, change in international laws
impose many new laws on the Marriott which becomes very complex for the
organization as legal formalities get increase and company has to incurr heavy cost on
the same. This create difficulties for the company to work smoothly in UK environment.

Identification of key issues needed for developing the marketing activities
•To develop its marketing activities hotel need to address the major and specific
challenges which is faced by them in this competitive environment. Some of them
are discussed as follows:
•Global Uncertainty: Due to frequent terrorist attacks in various countries have
created uncertainty around a globe. This is a major factor for the Hotel Marriott as
customers are more concerned about security issue and thus traveling less in other
countries. Other issues such as geopolitical relations, governmental travel
restrictions and fluctuating exchange rates.
•Customer Issue: Control over the customers is loosing due to use of internet,
demographic changes and frequent change in customer expectation because of
high education and sophistication.
•Human Resource Issue: Employees roles and demands are changing which
require more focus on them. Increase in staffing level, satisfying the employees by
adopting better management. Employee turnover due to cultural barrier are some of
the major challenges.

REFERENCES
•SWOT Analysis Diagram. 2015. [Online]. Available through
<http://www.dreamstime.com/stock-images-swot-analysis-diagram-
image13271564>. [Accessed on 24 November 2015].
•Tylenda, E., 2014. Sustainability and the Five Forces Model. [Online].
Available through <http://www.focus-on-training.co.uk/business-analysis-
resources/what-is-pestle-analysis/>. [Accessed on 24 November 2015].
•What is PESTLE analysis?. 2015. [Online]. Available through
<http://www.focus-on-training.co.uk/business-analysis-resources/what-is-
pestle-analysis/>. [Accessed on 24 November 2015].

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