Crowne Plaza Hotel: SWOT and PEST Analysis for Emerging Markets

This report examines the international hospitality industry, focusing on Crowne Plaza. It begins with a background on the industry and the hotel chain, followed by a detailed SWOT analysis of Crowne Plaza, highlighting its strengths, weaknesses, opportunities, and threats. The report then explores the global hotel and tourism landscape, differentiating between developed and emerging markets. An in-depth PEST analysis is conducted for a selected emerging market, evaluating political, economic, social-cultural, and technological factors relevant to the hospitality sector. The analysis of SWOT and PEST factors informs the development of a strategic plan for Crowne Plaza's market entry, utilizing strategic models and frameworks. The report justifies the chosen strategy and provides practical applications, projecting potential outcomes over a 5 and 10-year timeframe, and concludes with a summary of key findings and recommendations.

International Hospitality Management Assessment
Name of the Student
Name of the University
Author’s Note

Table of Contents
1. Background to International Hotel Industry and tourism...................................................3
2. Background to Hotel Company..............................................................................................3
3. SWOT analysis of selected hotel company............................................................................3
4. Background to Global Hotel and Tourism Industry – developed and emerging markets......5
5. Background to Emerging market...........................................................................................6
6. PEST of selected emerging market........................................................................................6
7. Analysis of SWOT and PEST................................................................................................7
8. Hotel strategy to be adopted and to be implemented (using strategic model and
frameworks) within the entering market....................................................................................8
9. Justification of strategy........................................................................................................10
10. Practical application of strategy – 5 and 10 years ahead...................................................11
11. Conclusion..........................................................................................................................11
Reference List..........................................................................................................................12

1. Background to International Hotel Industry and tourism
International hospitality and tourism industry is found to have grown several folds with the
last few years. The hospital and tourism industry have ensured that the travel is easy and cost
effective as well as safe. Technology has driven the growth of this industry which has
attracted more people. This has also resulted in an increase in the number of hotel rooms’
airlines and operation of cruises. The International Hotel industry has been found to
contribute around 8 trillion to the economy every year (Brackett and Carr II 2015). Each year
there had been an increase in the number of international tourists visiting a different part of
the world as reported by the World Tourism Organisation. The hotel industry today provides
wide ranges of services to the guest who includes banquet halls, conferences for celebration,
fitness and sports facilities, spas and bars in addition to the sophisticated restaurants. The
international hotel industry and tourism are known to be a dynamic sector which allows good
service, quality accommodation with great diversity in food and beverages.
2. Background to Hotel Company
The Hotel Crown Plaza is a well known multinational chain of hotels which has been
categorised as the most upscale hotels in the United Kingdom. The hotel has been catering to
the travellers visiting wither for business or for pleasure. The Crown Plaza chain of hotels is
known to be the part of the InterContinental Group of Hotels which has been operating in 100
different countries and with 3600 hotels (Crowneplaza.com 2019 ). These hotels are mostly
located in the city centres, like resorts, airport hotels and coastal towns. One such chain of
hotels of Crown Plaza is located in London Docklands. The hotel is known to have a unique
and contemporary look. The Royal Victoria Dock is one of three largest docks that are
located in East London.
3. SWOT analysis of selected hotel company
Strength
The Crowne Plaza chain of the hotel was found to implement the strategy of light business
model. The main idea is adopting the franchise model in different countries have helped the
chain of the hotel to become asset free as well as it can generate a large sum of cash with the
return of a large amount of revenue to the shareholders (Badran and Khalifa 2016). In 2004,

the chain of hotels has been reported to have generated 5.9 billion funds for the shareholders
and has been continuously increasing its profitability until this date. The strength of the
company is its ability to grow globally with a current record of 100 countries. There are
766,837 rooms are available in different countries. A number of hotels are in their pipeline
which will be opening in emerging countries like in the Middle East, Germany, India Mexico,
CIS, Indonesia and Greater China. Crowne Plaza management has been specifically giving
importance to customer preferences and customer experiences. In order to provide a personal
experience to the customers that provide several unique as well as traditional services that
which is based on the cost and availability. The handling of the customers is done on the
basis of the cloud-based technology so that a personalised experience can be given to the
customers (Büyüközkan and Ilıcak 2019). In addition, The Crowne Plaza hotel also provides
differential prices of the room if the customer has a loyalty relationship. This also enables the
chain of hotel in maintaining a sustainable competitive advantage. Additionally, the hotel has
been categorising and segmenting different hotel brands based on the occasion on which the
guest visits. This helps the hotel in meeting the expectation of the customers and also brings
about newness in the way the staffs handle the need of the customers, thereby creating a
brand image.
Weakness
The weakness which the chain of hotels currently faces is due to the increase in the monetary
transaction, almost 1200 hotels were found to be infected with malware stealing the
identification of the guest including the card number and their verification codes. In order to
maintain the brand image, the hotel chains have taken several initiatives for the loyalty
programs (Tribe 2016). However, these loyalty programs have drawn many negative remarks
from the customers.
Opportunity
The main opportunity for the chain of Crowne Plaza hotels is their location. Several
partnerships and rebranding of the hotels with different countries are been done to increase
the profitability of the chain of hotels. Additional with the increase in the number of
international tourists globally have increased the hotel’s opportunities towards an increase in
revenue. The booking of the customers in the chain hotel has been further facilitated by the
online bookings which are faster and provides greater exposure to the hotel brand.

Threats
The several threat which a growing chain of the hotel like Crowne Plaza faces are an increase
in competitors which includes well-known hotel chains like Marriot, AccorHotels, Hilton,
Hyatt and Choice groups. In China, the Crowne Plaza group of the hotel faces a challenge in
the workforce as only a small number of people in China prefer working in the hospitality
industry (Tribe 2016). While amongst this small section of the Chinese population very less
number of people have the skill or training on handling front desk, HR or finance.
4. Background to Global Hotel and Tourism Industry – developed and
emerging markets
Travel and tourism are known to one of the greatest revenue generating business. The
business of tourism has been growing with an increase in the number of bookings. In the
midst of low inflation and lower unemployment rate have led the consumers to earn more and
as a result, they are more inclined to spend them on travel and tourism more. In addition in
the developed countries, there is an increase in the lowering of the airline fares with lowering
of the price of the fuel, an increase in the international competition and entrants of low-cost
airlines.
As a result due to the decrease in the price of the airline, there is an evolution in the number
of tourists spending on international travel. One of the advantages of developed countries is
their economy. Due to their strong economy, these countries have a stronger business activity
which projects more travel and addition to the revenue of the hospitality and tourism industry
(Badran and Khalifa 2016). Further, an increase in the investment of travel has been observed
in comparison to the investment on the good. People prefer investment in recreational travel,
travelling in groups and eating out rather than spending money on expensive goods and
items.
In emerging markets like in the case of India and China, there had been an increase in the
growth of the tourism industry. The number of tourist travelling internationally has been
increasing every year. As per the World Travel and Tourism Council, the travel of the
customers in the emerging countries will become twice due to the increase in the availability
of the hotels, transport privileges (Okumus, Althany and Chathot 2010). People are keen on

experiencing the rustic life and their culture and way of living in these emerging countries
which have attracted an increased number of tourists.
5. Background to Emerging market
In Cairo, tourism is one of the most important sources of economy. The maximum number of
the workforce in Cairo is found to handle the number of visitors and tourist visiting Egypt
every year. There are as many as 14.7 million tourists that visit Egypt resulting in a
generation of 12.5 billion as revenue to the country’s economy (Badran and Khalifa 2016).
Egypt and especially the city Cairo had been known to have reached the pinnacle of tourism
since the year 2010. There were occasions where the number of tourists has declined due to
terrorist activities and security threats. However since the Egyptian Revolution in 2011, once
again there was a surge in the business activities in Cairo which have encouraged in the
growth of the visit of tourist and travellers (Badran and Khalifa 2016 ). In 2013, has been
accepted and ranked one of the best countries for travel and tourism. Thus Cairo is a suitable
city for opening a new hotel chain for Crowne Plaza.
6. PEST of selected emerging market
Political
The Egyptian constitution has a strong executive which provides the elected president with
the authority to elect more than one vice president, a prime minister and a cabinet. However,
the country is known to have an increase in political instability. The military rule is currently
responsible for making major decisions related to the force and it has prevented the company
from flourishing (Kara 2018). At the end of the election in 2012, it seemed that due to the
change in the authorities, Egypt has obtained a democratic vision which helps in the growth
of the markets in the country. But several issues persisted that prevented the development of
the country. Several struggles are still going on in order to gain control of power.
Economic
The economic condition of Egypt has been emerging since 2014 although the economic
condition is still weak due to its inflation rate which is as high as 10%. This has led to an
increase in the rate of unemployment, a high amount of debt of the individuals. In spite of all
the issues, there were positive hopes of the restoration of reforms so that the business

including tourism can flourish (Köseoglu et al. 2019). This adds to the revenue of the
country. Current the country is fighting again the political instability which had affected the
invested of the foreign countries as well as tourism. Imports became more expensive due to
the high inflation rate and oil shortage due to the inability of the government to provide
support for the subsidiaries for the imported articles.
Socio-Cultural
With the increase in the rate of unemployment the rate of crime was also increased
consequently. Women were sexually harassed and the society became unsafe for the women.
Women needed protection while moving around in public places and in crowded areas. In
addition shortages in power supply have affected not only the productivity of the different
industries but also have lost the customers in the tourism market (Tribe, 2016). The fuel
shortage is other shortcomings which the people faced in Egypt can pose difficulty in
building a hotel facility for tourism.
Technology
Although the past history of Egypt reflects a high investment of the people on technology
with an efficient machinery and accounting system, however with the increase in the political
struggle due to lack of leadership and dedication for the growth of the society, the country
remains backwards in terms of development in respect to technology and science. Since
2014, the country observed an increase in the market growth aided by the development in the
technologies.
7. Analysis of SWOT and PEST
The economy of Egypt was found to grow in the year 2007 with an increase in domestic
demand. The government became more liberal towards the approach for gaining confidence
in increasing the investment in the tourism industry. With the oil boom, the economy was
further benefitted allowing emigrant workers. This allows in the development of the external
financial situation with a trend of foreign currency earning and an evolution in the direct
investment of the foreign countries leading to privatisations (Hassan and Chirikure 2017).
The economic condition had helped in creating a business climate in tourism with the growth
of the economy and several active reform programs. Increase in the foreign exchange,

political and financial support from the different countries will help in the growth of the
hospitality business in Cairo, Egypt.
There is an evolution of the Egyptian market which is gradually opening up. There is a free
trade treaty which has been signed by the European Union with Egypt. In one hand Egypt is
responsible for the export of oil and fuel to the Western countries while, electronic goods,
nuclear reactors and iron and steel are been imported. This will allow the country to develop
in technology and utilise them in the business (Della Corte and Aria 2016). Thus setting up a
hotel in the Cairo city will be able to benefit the technological growth which has been
initiated in Egypt. In the current political situation, several new labour laws have been
released. The legal aspects help in the regulation of the labour market in Egypt. Thus this will
assist the hotel with the availability of staff that has provided better customer service to the
tourists.
8. Hotel strategy to be adopted and to be implemented (using strategic
model and frameworks) within the entering market
Porter’s Generic Strategy
As per Porter's Generic strategy, the two strategies which will help in the growth of the newly
initiated hotel branch of Crowne Plaza are cost leadership strategy and the differentiation
strategy. The cost leadership will provide the hotel to implement various services at a lower
cost compared to its competitive hotels in the same region. The basis by which the hotels can
manage in the production of lower cost services depends on various factors like the location
of the hotel, the marketing strategies which will provide better exposure to the brand and will
attract more customers (Bertozzi, Ali and Gul 2017).
The differentiation strategy will help the hotel branch to differentiate itself from the
competitive hotels. Again the differentiation between the various services which the hotel
provides can cause a huge difference in its ability to attract more customers. For example, the
Crowne Plaza may provide facilities for swimming pool with attached spa or gym facilities
which will be able to distinguish it from the other hotels.

Figure 1: Porter’s Generic Strategy
(Source: Bertozzi, Ali and Gul 2017)
Ansoff Matrix
The Ansoff matrix helps in the determination of the marketing strategies which the
organisation will take for the growth of the organisation. The model specifically suggests the
various attempts which need to undertake by the business so that the market for the service or
the product is created with the increase in the demand of the services provided by the
organisation. The first strategy which the new launch of the hotel in the Egyptian tourism
market will be selected is Market penetration. This is the strategy which is adopted so that
the new company can focus on the selling of the products and services in the existing market.
The Egyptian markets for tourism are highly competitive with the presence of many low-cost
hotels which will be more preferred by the tourist than a high-end stay (Farag 2015). In such
a case it is essential that the hotel provides some unique services which will attract tourist to
invest a little more so that they can stay in Crowne Plaza. For example, seasonal discounts
with lower room price in addition to a tour package of the city will be a better strategy which
will be able to attract more customers.
The second strategy which the new hotel can adapt to increase its business is through product
development. It is a growth strategy which introduces newer products in the market which
will be able to increase the competencies of the organisation (Yin 2016). For example, free
tour packages with hotel booking can be a service which will distinguish the hotel from the
other hotels.

Figure 2: Ansoff Matrix
(Source: Farag 2015)
Nykeil’s Fourteen
Amongst the fourteen marketing strategies which can be adopted for the growth of the new
business of the hotel of Crowne Plaza in Cairo is the Management contract. In this procedure,
the hotel initially will acquire staffs globally from different other chains of the same hotel.
This will have several advantages (Mahrous and Hassan 2017). Firstly, the organisation will
not have to take in any new employees initially when the hotel is newly launched. Secondly,
as the hotel growth, the older employees can train local people in customer service and
management so that they can assist in helping the customers in meeting their requirement
effectively.
9. Justification of strategy
The two strategies which will assist in the growth of the hotel in Cairo and the management
should be adopting is the cost leadership and product development. The main advantage of
the cost leadership with lower room rates or discounted tour services and at times
complementary hotel service will be able to create a brand image (Mak and Chang 2019).

The lower cost of the room in comparison to the other business class hotel will be able to
attract more business travellers and tourist. In addition, utilisation of social media platform
for the booking and advertising facilities related to the hotel will be a cost-effective way to
increase the popularity of the hotel.
Product/ Service development is an added advantage which the hotel management can adopt
which will give an enhanced experience to the visitors and the customers visiting the hotel
and thereby increasing their popularity. For example providing babysitting facilities for the
visiting families with infants, foreign exchange services, complimentary spa or massage
services are some of the services which the hotel can provide.
10. Practical application of strategy – 5 and 10 years ahead
The strategy of cost leadership will be able to provide a competitive edge to the organisation
in comparison to the other hotels. In addition, providing a frugal company culture which will
not only be able to decrease the cost can also increase in the profitability by attracting more
visitors and travellers (Ioannis 2013). The expertise of cost saving of the hotel will allow the
customers to charge less while succeeding in making profits similar to the competitors.
Further, service development will help in the brand extension. It will not only be able to meet
the expectation of the existing customers but also will provide a surprise factor to the new
customers. His will allows the hotel to maintain good service reputations which will spread
through word-of-mouth or social media. Thus within 5 to 10 years, the hotel will maintain
profitability with a larger base of the loyal customer in Cairo.
11. Conclusion
The tourism service is complex and the marketing strategy requires intricate planning and
implementation appropriately. In spite of Crowne Plaza being a well-known chain of hotels
the discussed strategies need to be adopted by the management so that it can survive amongst
the competition of the other hotels available in Cairo city. Egypt is well known for its tourist
attraction, the selected strategies will be able to establish the presence of the hotel in the
tourism industry in Egypt and also help in increasing their popularity so that the profitability
of the organisation increases with time.

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