London City Hall: Analysis of External Environment and Recommendations

This report provides a detailed analysis of the external environment impacting London City Hall, focusing on political, social, economic, and technological factors. The report utilizes the PESTEL framework to assess the challenges and opportunities presented by Brexit, GDPR, population trends, consumer behavior, and technological advancements. It highlights the impact of these factors on the venue's operations and proposes recommendations for developing effective sales and marketing strategies, including market segmentation and customer relationship management (CRM). The report also addresses specific barriers faced by London City Hall, such as the challenges posed by Brexit, and suggests solutions to maintain stability and competitiveness in the market. The analysis emphasizes the importance of adapting to changing circumstances, building employability, fostering teamwork, and viewing challenges as opportunities for innovation. The report concludes by summarizing the key findings and emphasizing the significance of understanding the macro environment for the venue's success.

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HOSPITALITY AND VENUE MANAGEMENT
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TABLE OF CONTENTS
Introduction......................................................................................................................................3
Overview of London City Hall....................................................................................................3
The current external environment which impacts London City hall in the context of its events....4
Recommendation of how the venue can develop its sales and marketing strategies in relation to
this environment..............................................................................................................................8
Solution to a specific barrier or challenge London City hall currently faces..................................9
Conclusion.....................................................................................................................................10
References......................................................................................................................................11
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INTRODUCTION
Organisations are affected by the environment they interact with. It is therefore essential to
analyse and understand the factors within the environment that affects an organisation. These
factors are classified into internal and external environments. Internal environment refers to the
factors that are within the firm such as technology, business culture, structure, and business
owners (Wetherley and Otter, 2014). On the other hand, the external environment refers to the
factors that are outside the firm that are beyond control but have an impact on the organisation
(Wetherley and Otter, 2014). Notably, the business environment can affect the sales and
marketing strategies of a firm. In this regard, it is important for organisations to assess their
environment factors as well as provide a solution to the challenges caused by them. The present
report assesses the current external environment which impacts London City hall in the context
of its events. A recommendation of how the venue can develop its sales and marketing strategies
concerning the environment is also made. Besides, the paper provides a solution to a barrier
currently based on the venue.
Overview of London City Hall
Fig 1: (Schroder, 2018)
London city hall is an event venue located between London Bridge and Tower Bridge with a
view of the Thames. It is a rounded building made of glass with a 500m suspended spiral
staircase over ten floors. It was opened in 2002 and it now holds the London Mayor’s question
time as well as a variety of banquets, conferences, and filming. On the ninth floor of the
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building, there is an exceptional venue which offers panoramic views of London landmarks.
Besides, there is tight security, thus, all guests need to be scanned through airport-style security
scanning.
The current external environment which impacts London City hall
in the context of its events.
London city hall faces various external environment factors which impact its operations in the
context of its events. External environment refers to the factors that are outside a firm such as
political factors, social factors, economic factors, technological factors, and environmental
factors. These factors can be analysed through PESTEL model analysis.
PESTEL analysis: (Perera and Rashain, 2017).
As mentioned in the introduction, the external environment refers to the factors outside an
organisation or a firm that affects its operations. Notably, the current external environment of
London city Hall is; political and legal, social, technological, and environmental factors. Four
main current factors are discussed below.
Political and legal: these are factors that are under the influence of the government (Bezuhla and
Liudmyla, 2020). London is the capital of the UK thus is affected by the political situation of the
UK. There is political stability in London and this has created a conducive environment for the
operations of London city hall. However, UK’s withdrawal from the EU (Brexit) has resulted in
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political uncertainties. Some people believe that Brexit will be a tool for the creation of more
opportunities in the future while others think it will cause chaos. With the recent violence and
crimes that resulted from Brexit, the venue operations declined and the number of guests
decreased significantly. According to Welfens and Paul (2017), Brexit has impacted the products'
safety as well as trademarks that reference EU licencing. Besides, Brexit caused a distraction to
the flow of goods due to additional compliance procedures. Notably, Brexit has reduced
investment in London city hall. This has been influenced by the uncertainty it caused to UK
businesses.
GDPR has also impacted London city hall. It stands for general data protection regulation and it
was implemented in the EU and EEA region. GDPR means that citizens of the EU and EEA have
control over their data, and are assured that their information is protected. GDPR calls for
businesses that process data of EU citizens even if registered outside EU territory to follow the
new rules on personal data protection. With this, all organisations that work with personal data
are required to appoint a data protection officer who is in charge of GDPR compliance. GDPR
has impacted customer engagement in London city hall such as the ways marketing activities are
managed.
Social factors: London city hall is affected by social factors which include population increase
and consumer market. The population of London grows older as the birth rates outnumbers death
rates and it is expected to increase even more. This has resulted in the enlargement of the
consumer market. Besides, the population has implicated the labour market as well as the health
care system. Moreover, there is a multicultural population in London. This has brought the need
of offering different products in London city hall to cater for people with different cultures.
The population of London in millions
2024 9.42
2023 9.36
2022 9.29
2021 9.22
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2020 9.14
2019 9.06
Source: (Issawi and Charles, 2020)
An important factor to consider in analysing the social environment is consumer trends (Bezuhla
and Liudmyla, 2020). With the improved technology in the UK, it has been noted that about 85%
of the population uses the internet every day and is online for almost seven hours a day. Besides,
most people in London search for products online and make a purchase especially for products
that are charged low. This has impacted London city hall since it needs to balance the customers’
trends by raising its brand loyalty as well as making use of the technology.
The consumer trends have also been influenced by the COVID-19 pandemic. It has been noted
that today many consumers are concerned with their financial security. Moreover, more than
35% of the population in London now prioritise saving overspending. This has reduced the
number of customers visiting London city hall. The covid-19 pandemic has also made people
prefer working from home rather than going to the offices (Donthu et al., 2020). This has made
work hard for the management of London the city hall especially in convincing the staff to get
back and work from the hall.
Technological factors: The UK is among the most advanced countries in the world. This has
resulted in advanced technological infrastructure which has benefited London city hall. Notably,
with the advanced technology, the invention of new products in the hall has been easy and fast.
Additionally, marketing has been made easier thus increasing the market of London city hall.
The mayor of London has ensured that mobile connectivity is done to London underground
tunnels. Besides, the mayor works with the local authorities to ensure that issues with poor
connectivity have been resolved. Furthermore, the government of London funds a digital
connectivity forum to enable businesses in London to successfully apply for digital infrastructure
funding (Foucart et al., 2021). Digital connectivity has benefitted London city hall in many ways.
It has been easy to introduce social media platforms to market and communicate to both the staff
and potential customers since almost all Londoners can access connectivity.
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Economic factors: these are those factors that affect the income flow (Perera and Rashain,
2017). With the outbreak of COVID 19 in 2019, London city hall has faced a lot of challenges.
To curb the pandemic, countries put containment measures to reduce its spread. This resulted in
workers staying at home and for some period, the venue was temporarily closed. At the same
time, many people lost their jobs due to closure or inability to go to work. Notably, the industrial
population declined by around 30% in London. This greatly affected the number of customers
visiting London city hall and, thus, reduction in the income earned.
The exchange rates in the government of the UK keep rising and falling. In recent years, the
exchange rate for the pounds has fallen. This has resulted in the weakening of the pound, thus,
goods and services have been made cheaper. London city hall has been impacted especially
when buying raw materials from abroad since the weak pound buys less increasing the cost of
production. Similarly, this increase in costs is passed on to customers resulting in higher prices
for the services offered.
Recommendation of how the venue can develop its sales and
marketing strategies in relation to this environment
A venue, firm, or organisation needs to come up with marketing strategies that relate to its
environment. London city hall faces the social environment factor of multiculturalism. This
implies that customers are from different cultures, thus, possess different preferences, religions,
and tastes. Similarly, different customers have different habits in terms of visiting the venue.
According to Dolnicar et al. (2018), market segmentation refers to the process of analysing the
customers and identifying their subgroups to their buying and visiting habits. London city hall
should make use of market segmentation to provide desirable products and services to customers.
This would also be helpful for the venue in understanding who is most likely to purchase certain
products.
Notably, a market segment cannot be created effectively without creating customer relationships.
Customer relationship management (CRM) is one of the most effective ways that London city
hall should employ to acquire accurate information within a market segment. A well-developed
CRM will help in acquiring actual information from customers themselves and this will help
build competitive advantage as well as understand all customers (Dolnicar et al., 2018).
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Solution to a specific barrier or challenge London City hall
currently faces
London city hall just like any other businesses and venues in the UK has been faced with
political issues caused by Brexit. However, the venue must continue operating despite the
political issues to ensure its stability in the market (Welfens and Paul, 2017). London city hall
managers and staff should keep calm and press on with business as usual. The UK labour market
is a strong one since it has been performing well. Notably, unemployment in the UK is only
around 5% and employment is about 74% better than in the US. With this, London city hall
should capitalize on the economy of the country and its labour market health. Adaptation to the
changing circumstances will help it stabilise its operations.
Brexit caused division and uncertainties among the local people of London. London city hall
should strategize on positive methods of building employability in the local community. This can
be done through investing in local talents as well as taking part in social responsibility. This will
help in retaining the competitive advantage.
The effects caused by Brexit brought disruptions. This disruption affects the operations of
London city hall. To solve this, it is good for the venue to embrace togetherness as they work.
This can be done through educating staff on the importance of working together. Besides, the
management should look at employee skills and try something new.
Treating a barrier as a challenge is key to an organisation. London city hall should treat Brexit as
a challenge, not a crisis. This will help it overcome the effects caused by Brexit as well as allow
the management to come up with creative and new ways to provide services. The new ways can
be through using technology such as clearing customers online before leaving the UK and
automating services understaffed by the worker shortage.
CONCLUSION
In a nutshell, analysing the macro environment of London city hall is very vital. The present
report has analysed the political, social, economic, and technological environment of the venue.
Politically, with Brexit and GDPR, the operation in London city hall has been impacted in terms
of investment as well as customer engagement. Socially, it has been concluded that the
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population in London has increased significantly over years. There is a multicultural population
and this has resulted in different customers with different religions and preferences thus the need
for market analysis. Importantly, market analysis and dealing with a large population have been
made quite easier due to the advanced technology used by London city hall. There is used on
social media in promoting their services as well as communicating effectively with the staff at
home. The paper has recommended market segmentation as a strategy in sales and marketing and
this can also be better achieved through the use of CRM. Finally, the paper has identified
different solutions to how London city hall can deal with Brexit. One of the solutions is to
consider Brexit as a challenge, not a crisis.
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REFERENCES
Bezuhla, L. (2020). Impact of The Macro Environment on The Ecotourism
Infrastructure. Green, Blue and Digital Economy Journal, 1(2), pp.33-38.
Dolnicar, S., Grün, B. and Leisch, F. (2018). Market segmentation analysis: Understanding it,
doing it, and making it useful (p. 324). Springer Nature.
Donthu, N. and Gustafsson, A. (2020). Effects of COVID-19 on business and research. Journal
of business research, 117, p.284.
Foucart, R. and Li, Q.C. (2021). The role of technology standards in product innovation: Theory
and evidence from UK manufacturing firms. Research Policy, 50(2), p.104157.
Issawi, C. (2020). Economic change and urbanization in the Middle East. In Middle Eastern
Cities (pp. 102-121). University of California Press.
Perera, R. (2017). The PESTLE analysis. Nerdynaut.
Schröder, T.W.A. (2018), September. Translating the concept of sustainability into architectural
design practices: The case of London City Hall. In Research Culture in Architecture-
international conference on cross-disciplinary collaboration: 27 and 28 September,
2018. Hosted by FATUK-Faculty of Architecture, TU Kaiserslautern (pp. 246-249).
Technische Universität Kaiserslautern.
Welfens, P.J. (2017). The true cost of Brexit for the UK: a research note (No. disbei234).
Universitätsbibliothek Wuppertal, University Library.
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