Crowne Plaza Hotel Strategic Analysis: Thailand Market Entry

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INTERNATIONAL HOSPITALITY MANAGEMENT
CODE
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Executive Summary
This report will give a brief about the micro and macro analysis of Crowne Plaza Hotel in Royal
Victoria Dock and Thailand and the positive and negative impact it has on the tourism of the
country. The background of the tourism of Thailand will also be stated in this report. The report
presented in this task has discussed some strategies of growth such as Porter’s generic strategies,
Ansoff’s matrix, and hotel strategic growth strategies as formed by Nykiel. The selected
strategies have been elaborated to select some of the growth strategies that can be implemented
in Crowne Plaza Hotel for growth of the business.
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Table of Contents
Introduction......................................................................................................................................4
Background to International Hotel Industry (and tourism).............................................................4
Background to Hotel Company.......................................................................................................5
SWOT analysis of Crowne Hotel Resorts.......................................................................................6
Background to Emerging markets...................................................................................................8
PEST of Thailand Tourism..............................................................................................................9
Hotel strategy to be adopt and to be implemented (using strategic model and frameworks) within
the entering market........................................................................................................................14
Justification of strategy..................................................................................................................17
Practical application of strategy – 5 and 10 years ahead...............................................................19
Conclusion.....................................................................................................................................22
References......................................................................................................................................23
Appendix........................................................................................................................................26
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Introduction
This report will be giving a brief discussion about the background of the International Hotel
Industry and a background history of the Crowne Plaza Hotel in Royal Victoria Dock. A detailed
discussion about the micro and macro factors of the organisation will also be discussed. This
report will also deduce the hotel strategies using the different factors. The justification of the
strategies and the practical application of the strategies will also deduce in the report along with
the emerging markets in the hotel and tourism and industry and the growth of the GDP of the
country due to it.
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Background to International Hotel Industry (and tourism)
The world’s most rapidly growing division of the industry in the world are the hotel and
hospitality sector. This sector helps the GDP of a country grow despite the tough economic
times. This has ensured the survival of the different sectors of the country. The international
Hotel Industry has showed tremendous growth in the last few years. This has become possible
due to the establishment of multi-national companies which has opened the number of business
travellers. The companies of the hotel industry continue to improve the quality of customer
service, which attracts a lot of foreign tourist (Ryan, 2015). The demand of luxurious hotel
industry is growing at a rapid speed. The tourists are willing to pay more to enjoy a comfortable
and a luxurious stay.
A survey on the internet suggests that the bookings on the tourism website have touched 1.6
million dollars in the last 4 years. Many tourists in the world have disposable income and are
ready to spend it in order to explore the world. The people are doing hotel management courses
in order to make a career in it. The chefs and the hotel management staffs in a five or seven star
hotel are paid really well due to the excessive demand of tours and travels. The international
hotel industry has gone from caves to skyscrapers (Baltescu, 2015). The UAE is the only county
in the world to have a seven star hotel and people are ready to spend a lot to have a luxurious
stay. The technology has also played an important role in boosting up the international hotel
industry.
Background to Hotel Company
Crowne Plaza is a branch of multinational hotels which is situated in the United Kingdom. This
chain of hotels includes intercontinental hotels, resorts and holidays Inn. This country operates in
more than 100 countries and it has more than 3600 hotels and 118,000 bedrooms. This company
also operates in the airports and coastal areas. This hotel was originally started as a Holiday Inn.
In 1999 the first Crowne Plaza Resort was opened in Madeira, Portugal. Currently, this brand of
hotel has 410 hotels in 52 countries and is also expanding to 81 hotels. This company has
sponsored a number of sports events and has also been a sponsor of the British FIA World
Touring Car Championship. It makes net-income of 352 million dollars annually
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(Development.ihg.com, 2019). It also specialises in catering services worldwide. Christopher
Marshall and Keith Barr are the Chairman and the CEO of the company respectively.
This brand has become the fastest growing hotel industry in the world and it focuses on Modern
Business Traveller. It also conducts business meeting and gives a luxurious treatment to its
guests to put a positive impact on them. This brand of hotel is a popular choice for both leisure
travellers and business.
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SWOT analysis of Crowne Hotel Resorts
Strength
 The company has a strong brand
image which makes it popular all over
the world. The company operates in
more than 410 locations making it
highly admired in the international
market.
 It focuses on the emerging markets of
the world.
 It offers a wide range of facilities in all
their branches. There are a host of
facilities for the tourists like Jacuzzi,
multi-cuisine restaurants, pubs, resto
cafes, fitness centres, swimming pool
and banquet halls. Many of its hotels
have mega conversation centres with
the facility to host conferences and get
together.
 The company also offers the tourist to
earn points from their stays (Kuo et al.,
2016). The tourists can use these points
to upgrade to a higher class hotel with
add on facilities.
Weakness
 The company’s share in the North
America has gone down due to the
expansion of competitors like Marriot
and rationalization of network.
 The revenues of the company are
decreasing because of weak financial
performance.
 The maintenance and the upkeep costs
of the luxury hotels are higher as
compared to the returns.
 The per capita income of the people of
Thailand is very low so having a
franchise will be a weakness for the
organisation.
Opportunity
 The company has enough disposable
income to expand in smaller countries
and create a market of its own.
 Thailand has become one of the leading
tourist places in the world. A number of
Threats
 The company faces a lot of competition
from brands such as Hilton, Novotel
and Radisson who are in the race to
become the market leaders.
 The recession has adversely affected
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people visit the country from all across
the world. The organisation has the
opportunity to set up its business in
Thailand to expand its growth.
 The company can also expand its
product range by launching its cruise
ships, which is very much popular in
Thailand.
 There has been a constant increase in
the global travelling. People travel
more often than before and prefer to
stay in luxurious hotels.
the tourism and hospitality business
and many properties are out of the
market and the company is unable to
generate revenues.
 The high class luxurious hotels are
facing a huge risk from terrorism as
these hotels are the main target of many
terrorist groups.
Table 1: SWOT analysis of Crowne Hotel Resorts
(Source: Created by the learner)
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Background to Emerging markets
Thailand in the recent years is emerging as one of the leading markets in the hospitality industry.
Many people travel to Thailand to study and make a career in hospitality and tourism. In the
recent years a number of visitors are expected to increase in Thailand. The people from North
America are travelling to Thailand because of the increase in the quality of the tourism and the
facilities provided by the people of Thailand. Its capital Bangkok has been listed in the top ten
attractive places in the world. The tourism is Thailand’s main economic sectors which cover
more than 6-7% of the country’s GDP. In order to make the tourism more popular in the country,
the government is investing on airports and the communication system.
The government is making the railway system more developed for the tourists to have a hassle
free travel within the country. The country is very much popular within foreigners for the warm
hospitality it offers to its tourists. It organises a number of cultural and colourful festivals for the
tourists to have a wonderful living experience. It also offers a number of arts and crafts hand
made exclusively by the Thai people. Thailand is spending a lot of money on to improve the
beaches and trekking for which the country is well known for. The tourism in the country
definitely has a positive impact on the country. Due to tourism in Thailand there are more than
5,383,000 jobs in the tourism industry (Iverson, 2017). More than 14.1 percent of employment in
the country is supported by the tourism industry. According to a survey on the internet there will
be more than 8,140,000 employments in the tourism and hospitality industry.
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PEST of Thailand Tourism
Elements Factors Analysis
Political  Size of government
budgets- The
government of
Thailand showed a
deficit of 10026 THB
million in the month of
February 2019
(
Tradingeconomics.co
m, 2019).
 Import-Export
regulations- The
harmonised system is
adopted by Thailand
for both imports and
exports (Emerging-
markets-
research.hktdc.com,
2019). All the imports
taking place in the
country is subject to
VAT.
 Domestic Political
Tensions- The political
tensions is rising
drastically in the
country
(www.dw.com, 2019).
 Since the government
of Thailand showed a
deficit in the budget
then the country will
face a negative impact
on tourism as the
government will not be
able to spend much on
tourism. The
government will fail to
improve the
communication system
within the country
leading to a downfall
in the tourism industry.
 Thailand is focussing
more in manufacturing
their own goods and
products in order to
lessen the import and
increase the export.
This will boost up the
government’s revenue
which it can use it to
spend on increasing
the hospitality. This
will therefore lead to
positive impact on the
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There have been anti-
government protests on
the streets of Bangkok.
tourism of the country.
 Political tensions will
have a negative impact
on the tourism.
Protests will lead to
curfew which will
prevent tourists to
migrate in the country.
Economical  Gross domestic
Product Trend-
Thailand’s economy
expanded 0.7 percent
in the month of June
2019
(
Tradingeconomics.co
m, 2019).
 Unemployment Trend-
The unemployment
rate in the Thailand has
increased from 0.90
percent to 1.10 in the
month of July
(
Tradingeconomics.co
m, 2019).
 Propensity of people
to spend- The people
of the country are not
economically or
financially stable
 The GDP of the
country is being spent
on importing oil and
gas which is increasing
the threat of inflation.
Increase in the
inflation will have a
negative impact on the
tourism of the country.
 The unemployment in
the country will lead to
a positive impact on
the tourism of the
country as the people
will be willing to work
in the tourism industry
at low wages.
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(raina et al., 2018).
Social  Cultural norms and
values- Thailand is
well- known for its
cultural heritage. It
hosts a wide range of
cultural festivals. The
majority of the culture
comes from traditional
Thai people (Skinner,
2017). The major
influence of the culture
of Thailand is
Buddhism.
 Lifestyle- The trend of
leading a healthier
lifestyle is becoming
popular. The lifestyle
of different countries is
very much different
from each other
(Botterill, 2017).
People are becoming
more leaned towards a
premium lifestyle.
 Attitudes towards
foreign people- The
attitude of the locals
for the foreign people
has hit an all time low.
 The rich culture of
Thailand is famous all
over the world. People
from all over the world
come to visit and be a
part of Thai culture.
This will have a
positive impact on the
tourism of Thailand as
more people will
migrate to visit the
country.
 People’s will to have a
healthy and premium
lifestyle will have a
positive impact on the
country. There are
many hotels in the
country that offers a
exotic stay for the
tourists. Since, healthy
lifestyle is becoming a
trend in the market; the
tourism of the country
will flourish in the near
future.
 The bad and rude
attitude of the Thai
people towards the
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