The Contemporary Hospitality Industry

This report discusses the internal and external factors impacting the hospitality industry, using Hilton Hotel as an example. It includes a PESTEL analysis of Hilton Hotel and a SWOT analysis. It also explores current and potential trends in the industry.

The Contemporary
Hospitality Industry

Table of Contents
INTRODUCTION...........................................................................................................................3
LO 3.................................................................................................................................................3
PESTEL Analysis of Hilton Hotel..............................................................................................3
SWOT Analysis..........................................................................................................................5
LO 4.................................................................................................................................................7
Current and potential trends in the hospitality industry..............................................................7
CONCLUSION...........................................................................................................................8
REFERENCES................................................................................................................................8

INTRODUCTION
Hospitality industry includes a very broad range of categories. Some of them may include
accommodation services, food and beverage services, cafes, restaurants, hotels and much more.
The business for this particular industry majorly increases with the increase in the craze of
travelling among the people. To make the strategies the analysis of both internal and external
environment is very much necessary. The analysis of these environment is of paramount
importance as they provide an elaborate idea about factors which may put impact upon the
business and its operations. For reference purpose this report has taken an example of Hilton
Hotel. The hotel was established in the year 1919 which has the largest hotel chains in the whole
world. The company's hotel is very expanded in around 94 countries. The hotel manages to
perform various accommodate facilities to their customers by offering them different offers and
schemes to their customers.
This report discusses about the internal and external factors which has put impact upon
the business operations. The report also includes the current trends which are prevailing into the
industry.
LO 3
PESTEL Analysis of Hilton Hotel
The PESTEL analysis is a framework in which enable an organisation in analysing the
external factors which can heavily impact the business activities. These external factor are totally
independent from any factor. Analysing these factor are very much important as they help in
making the strategies for the organisation. The pestel analysis of Hotel Hilton is as follows:
Political factor: This factor includes the degree towards which the government has the control
upon the activities of organisation or industries. The hotel is set up into the countries where the
government stability is present. The stability in government helps an organisation in bringing the
stability in their operations of hotel also (Anton and GAREEV, 2019). Otherwise the countries
where the government is unstable there the policies and rules get change very often creating
difficulty for hotel as they need to make the required change very often.

Economical factor: The economical factor includes the situation and condition of the region or
country. It may includes the disposable income, foreign trade policies, exchange rates, economic
growth and much more. As in the case with Hotel Hilton, the data like economic growth rate,
disposable income, employment rates and the like can be used in forecasting the demand for the
Hotel. By analysing these factor the company would be able to set its target for its season
accordingly. Through the economical factor, the Hilton hotel can set the prices for its services by
considering the disposable income of the people resisting in the region.
Social factor: This factor tells the analyst about the current trend with respect to taste,
preferences, behaviour and attitude of the target market about a particular topic. Through the
analysing of this factor the company could be able to know about the customers and their taste so
that they can provide them with that service (Guan and et al., 2020). The key to profit is to
provide the customers with the services and products which is in demand by the customers or
which they want. Through this the more and more customers would get attracted towards them
which results in the increase of sales for their offering services. Through the proper analysis of
the social factor, Hotel Hilton gets aware about the sustainability development trend which is
running into the market place. The customers now prefer to take the services of that hotel where
the sustainable growth and development is encouraged. Through that only the Hotel adopts the
practices which encourage the activities of sustainability development and growth. Also the
customers have become very smart in putting their money. They want to spend their money at
the places where they think the equal and more value would be coming. The buying behaviour of
the customers changes like a trend. It does put a major impact upon the sales of Hilton Hotel as
the behaviour of customers get fluctuate very often causing it difficult for hotel to cope up.
Technological factor: The technological factor includes the technological advancements which
is present into the organisation. As the hotel Hilton spread in around 94 countries, to have the
proper accountability of their business operations and activities they might required a data base
which has the capacity to store such large scale information. To surmount this problem the
company has adopted an advance management information system which would enable the
Hilton hotel in saving of their information and data at a single server only. This would help the
organisation in using that information in making the desired decisions for the organisation. These
information proves to be great help in fetching out the important information which is helpful in

formation of Hotel strategy. Hilton Hotel also has adopted a advance sustainable practices which
contribute in environment betterment by producing minimum carbon in the environment.
Environment factor: This factor includes the policies and rules related to the environment.
Hilton hotel before starting up the new hotel analyse the environmental factor where it includes
the climate and weather details which are present in the region (Iyer and Jarvis, 2019). Hotel
Hilton also has adopted the activities and practices which generates the minimum or zero carbon
emission in the environment. The company also has adopted the advance waste management
process in which they has the technology for recycling of waste which leads to minimum waste
materials. Apart from this the Hotel Hilton has also show their care towards nature and other
species which are living on the earth by petting some of the friendly species like birds, dogs,
rabbits in the hotel premises.
Legal factor: The legal factor includes the rules and policies which are formed by the
legislation. The organisations has to obey all these laws which are set by the legislation if they
want to operate properly in the industry. It has been noticed that the Hotel Hilton follows all the
legal laws in their operations. This has put a very positive image about the company in the
market place and among the customers. Hilton Hotel by obeying all the legal laws has
successfully obtained a goodwill in the market place which directly and indirectly has enable
them in gaining the competitive advantage. Apart from this the Hotels of Hilton company are
safe and healthy for the employees who are working there fulfilling the Employment Act of
legislation.
SWOT Analysis
The SWOT analysis is a framework through which the organisation gets to evaluate
about the internal factors which affects its operations. Through the SWOT analysis the
organisation gets to know about the areas where they need to make the changes and areas where
they have the upper hand in the industry operations (Koseoglu, Law and Dogan, 2018). This
framework helps the organisation in forming the strategies which help the business to grow and
survive. The SWOT analysis of Hotel Hilton is as follows:
Strengths:
 Huge portfolio of property: The Hotel Hilton has the comprehensive property in the
hotel industry. The Hilton Hotel is established at around 94 countries which enables them
in establishing a global presence into the market place. The comprehensive portfolio

would enable the company in providing the variety of services to the customers which
also helps in increase in their sales.
 Strong history: The Hilton Hotel is operating in the market place from around 101 years.
Its business history is very strong enabling them in getting more attention and attraction
form the customers. As the business history of the hotel is very strong the company can
easily gain trust of targeted customers. This works as a strength to the company.
 Strong loyalty program: The Loyalty programs set by the company are so unique and
successful that it enables the company in retaining its customers.
 Positive image about brand: As the company is very old in the hospitality industry it
has successfully establish the positive brand image into the market place. Successful
brand image helps the company in establishing a goodwill which increases the value of
hotel in the market (McCartney and McCartney, 2020).
Weakness:
 Limited presence in Asia Pacific region: The company has very limited reach in the
region of Asia Pacific. Due to this the people belongs to this region are not aware about
the company and its services offered.
 Over dependence on market of US: The company has the over dependence on US
market as they are predominately establish into the US market and much of their sales are
present from that market only.
Opportunities
 Expansion: The Hilton Hotel has the opportunity in getting itself expand into the market
place where it has not put its step before. The expansion would lead into more strong
network for the company.
 Affordable section: The company also has the opportunity to open the section for mid
level people so that they too can enjoy the luxury services offered by the Hotel.
Threat
 Competition: The competition in the Hotel industry is keep on increasing with the time.
This competition has creating a burden upon the company as they frequently needs to
come up with the services which enables them in gaining the competitive advantage in
the market place (Prud’homme and Raymond, 2016).

 Political factor: Any change in the political factor like unfavourable rules and
regulations of the government which may result in the loss for Hotel can prove to be a
great threat.
 Terrorism: The increase in the threat of terrorism may impact the hotel industry as the
travelling of people may get decrease. This works as a threat for the Hilton Hotel.
From the evaluation presented above, it can noticed be noted that the company can gain
competitive advantages through the strength it has with it. Like customer loyalty, company’s
strong history, good and huge portfolios. The Hilton hotel has to make strategies which can help
them in converting their weakness to their strengths. Apart from that the company has also ample
of opportunities for its growth and profits and upon which it can work. Also there also some
threats which the company has to face and needs to form their strategies accordingly.
LO 4
Current and potential trends in the hospitality industry
The current and potential trends which are running into hospitality industry may includes:
More personalised services: It has become a current and running trend among the industry in
which the hotels have started providing the personalised services to the customers. Through
personalised services the customers can opt for that facility which he wants to have and the
services which he does not want to take. The personalised services increases the level of
satisfaction among the customers and market growth and share in the market place. As in the
case with Hotel Hilton, they have the facility to provide the personalised services to their
customers. They tries their best to stand up the expectation of customers by providing the
services they are looking for.
Technological innovations: Now the hotels are employing the advanced robots in their hotel
which helps them in providing few services in the hotel. These robots may perform the work of
scot person who can take the guests into their rooms, these robots can also be used in serving
place and also at reception position (IVan Der Wal, Nisbet and Haw, 2020). The employment of
these robots can save the cost for the hotel to a great extent as these robots have placed the
human and their associated cost. The technological innovation can also be used at the time of
booking the rooms for the hotel as with the help of technologies the booking can take place with
a more efficient way. As in the case with Hotel Hilton, the company has establish itself at the

online platform also. The official site of the company is available at the internet where the
customers can go an look out for information. For their they can also took the rooms according to
their need and budget. At online platform also, the customers can review the feedbacks and a
glim about the Hotel.
Smart rooms and use of AI: The trends use also includes the installation of smart rooms with
are very technologically advanced which has the Artificial Intelligence installed in it. The use of
AI can attract the customers to a great extent as they may help in making the services more fast
and effective. The use of AI has become the hot spot trend in the hospitality industry. Through
the AI installation in the rooms the guests can set the alarm, switch on and off the lights, can
control the other functions like air conditioners, tabs, and etc. These AI can also used as the room
serve people who can visit to their room with the service the guest ordered. As in the case with
Hotel Hilton, they are in urge to establish the effective artificial intelligent technologies in the
hotel. They have artificial intelligence supporting rooms where all the things or services can get
in control through advance technology only. Like switching on and off the lights, calling to the
various facilities and staff to the room and etc.
CONCLUSION
From the report presented above, the internal and external analysis of the Hilton Hotel
has been performed. The internal analysis is performed through SWOT analysis where as the
external analysis is performed through Pestel analysis. There are various trends which are
running into the market in hospitality industry, some of these trends may include smart rooms
and use of AI's, technological innovations, personalised services and much more.

REFERENCES
Books and Journals
Anton, V. and GAREEV, R. R., 2019. Hospitality Industry in Russia: Key Problems and
Solutions. Journal of Environmental Management and Tourism. 10(4). pp.788-800.
Guan, X., and et al., 2020. Does organizational inducement foster work engagement in
hospitality industry? Perspectives from a moderated mediation model. Journal of
Hospitality and Tourism Management. 43. pp.259-268.
Iyer, G. R. and Jarvis, L., 2019. CSR adoption in the multinational hospitality context.
International Journal of Contemporary Hospitality Management.
Koseoglu, M .A., Law, R. and Dogan, I. C., 2018. Exploring the social structure of strategic
management research with a hospitality industry focus. International Journal of
Contemporary Hospitality Management.
McCartney, G. and McCartney, A., 2020. Rise of the machines: towards a conceptual service-
robot research framework for the hospitality and tourism industry. International Journal
of Contemporary Hospitality Management.
Prud’homme, B. and Raymond, L., 2016. Implementation of sustainable development practices
in the hospitality industry. International Journal of Contemporary Hospitality
Management.
Van Der Wal, C., Nisbet, S. and Haw, J., 2020. A Qualitative Exploration of the Causes and
Consequences of Workplace Bullying in the Australian Hospitality Industry. Journal of
Quality Assurance in Hospitality & Tourism, pp.1-22.