Strategic Analysis of Marriott International: PESTLE & SWOT Frameworks

This report provides a comprehensive analysis of Marriott International's business strategy, employing several key frameworks. It begins with a PESTLE analysis, examining the macro-environmental factors impacting Marriott, including political (terrorism threats), economic (economic slowdown in China), social (increase in international tourism), technological (rise of Airbnb), legal (Airbnb regulations and minimum wage laws), and environmental (fuel costs and climate change) considerations. Subsequently, the report conducts a SWOT analysis to assess Marriott's internal strengths (brand recognition, innovation), weaknesses (rigid procedures, controversies), opportunities (growing luxury travel, strategic alliances), and threats (competition, economic downturn, terrorism). Finally, the report applies Porter's Five Forces model to evaluate the competitive intensity within Marriott's market sector. The analysis covers the threat of new entrants, bargaining power of suppliers and buyers, the threat of substitute products or services, and the intensity of competitive rivalry. The report concludes by summarizing the key strategic considerations for Marriott International based on these analyses.

Business Strategy

Contents
Contents.................................................................................................................................................2
INTRODUCTION.................................................................................................................................3
TASK....................................................................................................................................................3
P1 Apply appropriate frameworks to analyse the macro environment for a given organisation.........3
P2 Using appropriate frameworks analyse the internal environment and capabilities of a given
organisation.......................................................................................................................................5
P3 Apply Porter’s five forces model and to evaluate the competitive forces of a given market sector
of the organisation.............................................................................................................................8
CONCLUSION..................................................................................................................................14
REFERENCES....................................................................................................................................15

INTRODUCTION
Business strategy refers to a set of actions and plans that are developed by an
organisation to carry its activities and operations smoothly. Business strategy is also defined
as a series of plans that are implemented by an organisation to secure a completive market
position, ensure smooth operations, attract more customers and attain favourable outcomes of
the business. In order to develop a strategic plan for a business the aim of organisation is
framed, then course of action is planned, examination is done and then results are evaluated.
Business strategy involves a series of actions that are deliberately conducted to achieve
higher level of performance with effectiveness and efficiency. The business strategy also
helps to enhance the competitiveness of the firm and identify or perceive the opportunities
and threats beforehand. A business strategy is a hard and fast of competitive actions and
actions that a commercial enterprise makes use of to attract customers, compete correctly,
strengthening overall performance, and attain organisational goals. It outlines how business
needs are to be finished to attain the preferred ends. Marriott International is an American
multinational organisation which is operated, franchises, and licenses lodging including hotel,
residential, and timeshare properties. The company is headquartered in Bethesda, Maryland.
It was founded by J. Willard Marriott.
TASK
P1 Apply appropriate frameworks to analyse the macro environment for a given
organisation
To analyse the macro environment the Pestle analysis tool, can be used which is a
framework designed to evaluate the extern al factors which can influence the business
organisation. The various factors are explained below:
Political factors- The key political issues that could affect Marriott are the threat of terrorism,
members of the international family and the political climate in the areas of famous travel
locus. The greatest threat is a terrorist attack, chances of warfare or military invasion that
could disrupt international air travel or intimidate people at far away from tourist location.
Examples of such incidents include the destruction and air bombardment of the Malaysian
Airlines Flight MH17 in July 2014, which turned down by a ground to air missile shooting in
Ukraine, and the 9/11 attacks in 2001. The collaborations of many terrorist organizations with
ISIS make such events worse, but with the degradation of ISIS, it came to an end. Naturally,

any collapse of the flight may reduce the willingness of people to travel globally and hence
may decline the need for hotel rooms. There is little evidence that terrorists have targeted
recreational and diverse destinations, but in June 2015, 39 people, including tourists, were
killed on the coast of Tunisia. Such an attack could hamper Marriott and its activities of
customer attraction and the profits of business. Therefore, it has to think of increasing the
demand of customers by elaborating security features.
Economic factors- The economic factors that could affect Marriott's business include factors
such as the slowdown in China's economic growth and the on-going economic conditions in
European countries such as Ukraine. Events such as the collapse of the commodity market in
China and the conditions of war in Europe have severely limited people's ability to go in
foreign locations and travel across borders. Major factors that have led to a decline in tourism
activity have also hindered the departure of a business trip on which Marriott is based.
Marriott suffers from high trading costs or U.S. dollar exchange rates in and across remote
areas, discouraging Americans from going overseas and visiting foreign destinations such as
Las Vegas. High exchange rates can also reduce income of travel businesses and related
businesses such as hotels. Long-term financial risk has increased income inequality and lower
wages in the United States, which has reduced people's ability to travel and stay in hotel
rooms.
Social factors- These factors make the conditions look very good for Marriott as the number
of people planning international tourism increased by 13 per cent between 2013 and 2014,
according to Mashable. More importantly, the number of tourists willing to spend time and
money away from home has grown exponentially from $ 5,955 in 2013 to $ 5,136 in 2014.
This shows that there are many travellers who spend a lot of money on foreign trips and
international travel. It seems that a lot of people tend to travel and pay extra to enjoy time
with them. Interestingly, Australians spend a lot of money on travel, about $ 12,393 by every
individual as average on their cross-border travel in 2014. People in the United States, Asia
and Australia with growing income levels may increase the demand for international travel,
including full-time travel and luxury accommodations.
Technological factors- Technology may have a greater impact on the lounge and restaurant
businesses, in the form of online apartment outlets including Airbnb, which may allow
individuals to rent rooms or houses directly to guests or travellers and tourists with the help
of online bookings. About six million visitors stayed at the Airbnb facilities in 2013.

According to Inc., there are 25,500 Airbnb listings in New York alone that may affect the
business negatively. The biggest potential threat to Air BNB in resort tour groups is that its
guests can avoid prices that include accommodation taxes and accommodation regulations,
which means they have very low operating costs. That allows Airbnb guests to lower the cost
of luxury housing in many markets.
Legal factors- The key legal factor to influence Marriott's future business venture is Airbnb's
online booking systems and offerings that are made by such other businesses. Authorities in
various cities such as New York, New Orleans and Barcelona have fined Airbnb and its
subsidiaries for violating local laws, accommodation regulations, and health and safety
regulations. There have been complaints that a few strangers are exploiting Airbnb in some
markets to run the equivalent of illegal businesses. Another situation is that Airbnb tourists
now do not pay local taxes, which is a major source of revenue for some municipalities. In
the United States, Marriott also faces the possibility of a minimum wage - up to $ 15 per hour
for some offers. That should lead to higher costs and reduce company discounts.
Environment Factors- Currently a major environmental component that could disrupt
Marriott's commercial business is the increasing costs of fuels. Lower fuel costs should lead
to lower travel costs and the hotel room costs can be adjusted accordingly for gaining higher
profits. Clearly, the volume of risk in Marriott's business could be from the dramatic increase
in fuel costs, especially of air fuel and land transport. The strong long-term environmental
impact of the Marriott should include increased energy costs made by efforts to prevent
greenhouse gases in a way that prevents the burning of coal in the power station. Climate
change could hurt Marriott's business with the causes of rising sea levels and floods or
developing hurricanes that damage coastal areas. Rising temperatures due to global warming
may suppress the areas near ski resorts or make a few beach resorts too hot for customer
leisure experience. That tendency can force the closure or removal of settlements in theses
areas.
P2 Using appropriate frameworks analyse the internal environment and capabilities of
a given organisation

The appropriate framework to analyse the internal environment of the business
organisation will be SWOT analyses which is a tool used by the various business enterprises.
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats, and so a SWOT
evaluation is a method for assessing those four factors of your commercial enterprise. SWOT
Analysis is easy tool that allow you to analyse what your corporation does high-quality right
now, and to plot a success approach for the future.
STRENGTHS WEAKNESSES
 The strength of the resort lies in its
strong adherence to its operating
procedures. Their code of conduct is
customized using pinnacle control
and all activities are perfected. It is
said that most of these guidelines
focus on improving the efficiency.
 Marriott’s operational philosophy is
focused on innovation and most of
its procedures and systems try and
combine dedication and innovation
to ensure general value for money.
 Marriott International has a
presence in 122 countries around the
world and has 600 properties under
its umbrella with 1.2 million rooms
to its credit.
 Marriott was in a state of aggressive
growth and today their empire is so
large that it is impossible to keep up
with the needs of the network
company because the product are
refined.
 Marriott is a system-driven business
and all work is given complex and
fast processes in whatever it does.
Firm adherence to procedures which
has lowered staff morale.
 Marriott’s brand has been marred by
non-stop controversies. One of the
present days is the blockage of
private Wi-Fi of clients declaring
privateers dangers. Such poor
advertising puts the logo in terrible
light.
OPPORTUNITIES THREATS
 People all over the world are more
open to living in luxurious places
when visiting with their families and
this is a seemingly absurd trend in
developing economies - an
opportunity for those who work for
travellers who have no power to
 The company is facing a lot of
competition from companies like
Hilton, Novotel etc. who are aspiring
to become the market leaders.
 The global economic downturn has
taken a toll on the tourism industry
and many residential areas are not

ignore.
 In contrast to the remaining decade,
the number of humans traveling each
on paintings and delight has
expanded substantially. Through tie-
ups, with airlines lodge chains can
exploit this opportunity to their gain.
 Today the consumer needs personal
satisfaction and in many situations
they are also willing to pay extra for
it. In this way the dormitories may
want to pay a higher percentage for
each individual provider they offer.
available for sale because they may
not be able to make money.
 Star-rated locations around the world
are facing a major threat from
terrorist organizations as your form
has easy targets to attack. Such
occasions often prevent guests from
staying in these luxury hotels.
McKinsey model
This is the model which is used by the various business organisations in order to
identify and analyse the various internal capabilities which can help the organisation in the
various aspects. There are various elements which are been discussed in this model in context
of the Marriott company:
 Strategy- It is the strategy or the way in which the organisation develop and achieve
the competitive advantage and successfully compete in the market. This is one of the
most important elements for the company in order to achieve the goals of the
organisation. The Marriott adopts the various business strategies in order to compete
with the market.
 Structure- This is the way in which the business units and the divisions are
organised. It is the most important for the company to have the right structure for the
flow of the information in the organisation. It is the most essential elects for the
Marriott so that the employees have the information and know who has to report to
whom.
 System- This is related to the process and procedures of the business organisation.
This is the era which determines how the day to day activities are conducted in the

business organisation. It is very important for the managers to have the right system in
the organisation which is followed by the employees of the company.
 Skill- This is defined as the ability of the employees of the business organisation. It is
very essential for the company that it motivates its employees and have the training so
that their skills can be developed in order to achieve the goals of the organisation. It is
important for the managers that they focus on the skills of the employees so that the
company can achieve the competitive advantage.
 Staff- This is related to the concern of which type of employees are there in the
organisation. It is very essential for the Marriott that they concentrate of hiring the
right set of employees and they are well trained and the managers are able to motivate
their employees in order to perform effectively.
 Style- This is related to the way in which the organisation is been managed from the
top level management. It is in relation to the format of the business in which the
employees and managers take actions. This is related to the leadership style adopted
by the organisation. The Marriott adopts the autocratic leadership style in order to
have smooth functioning.
 Shared values- This is related to the norms which is adopted by the organisation. It is
necessary for the employees and the managers to have the value in which it is
believed to perform the business organisation goals. The main aim of the Marriott can
be that each employee performs the activities keeping in mind the values of the
company.
P3 Apply Porter’s five forces model and to evaluate the competitive forces of a given market
sector of the organisation
Porter's Five Forces Model- Porter's Five Forces is a model that identifies and analyses the 5
aggressive forces that make up each business and allows it to determine weaknesses and strengths of
their business. Five Forces analysis is often used to determine a business external environment in
order to determine its business strategy. The Porter five forces can be used with every business to
identify the level of competition within the industry and adorn long-term business profits. Porter's
Five forces are elaborated below:

• The threats of new entrants - Newcomers to the industry bring change, new ways of doing
business and pressures for existing business such as Marriott International. By way of price
reduction, cost reduction, and offering new price proposals to customers. Marriott
International, Inc. He has to control most of these difficult situations and build strong barriers
to protect his aggressive side. Marriot can take care of new entrants by introducing new
products and services or barriers to stop them. The new products not only bring new
customers but also give the old enthusiast a reason to buy the products of Marriott
International. By building a standard economy to reduce the fixed price per unit the company
can enhance its foothold in the market. Improving efficiency and spending on construction
and development of business ideas can also enhance its operations. New entrants are less
likely to enter the changing industry where existing players include Marriott International. It
greatly reduces the availability of benefits for new entrants and discourages new players to
enter the industry. It has been analysed that there are higher threats to new entrants due to
other services such as Airing, which is a very serious threat. It is important for the Marriott to
consider this and apply new strategies that can help achieve competitiveness in the industry.
• Power of negotiating with suppliers- All the organizations within the restaurant or lounge
business purchases their own consumables from a few suppliers. Leading role providers may
lower the margins of Marriott International but it can benefit the market. Powerful suppliers
in the service area use their negotiating power to bring better pay to companies in the leisure
and restaurant sector. The general effect of negotiation power on existing suppliers is that it
reduces the normal Benefit.
• Consumer bargaining ability - Consumers are often unconvinced, they want to use available
resources for as little money as possible. This has put pressure on Marriott International and
its profit creation. The customers are highly based on the organizations that provide
discounted offers to their customers. Marriot uses its ability to negotiate better with customers
and improve their ability to seek growing profits. By building a large customer base. This can
be helpful on the roads. It will reduce customer negotiation capacity and allow the company
to plan to sell and produce a system of better exchange. By introducing unexpected sales.
Customers are always looking for discounts and services on online products so if Marriott
International, Inc. Continuing to develop new products may place barriers in consumer
negotiation abilities.
• Available substitute Products- If a brand new service or product meets the customer
requirements in one positive way it’s worth. For example donations like Drop box and Google
Drive replace hard drives. The power of some services or products is enormous when it
comes to offering value propositions that are very different from giving gifts to the industry.

Marriott can focus on a few things like getting used to the network company instead of just
focusing on the product. By knowing the core wants of the customer instead of what the
consumer buys. By increasing the cost of changing clients.
• Competition with existing competitors- If competition for the current number of players in
the business passes it will reduce costs and reduce the overall profitability of the business.
Marriott International works in an aggressive business in which competition affects the
normal long-term profit of the business.
P4 Application of various concepts, theories, principles and models that can help to interpret
and devise strategic planning for an organisation.
Planning is one of the basics of the modern era and everyone uses it in large or small quantity.
In our personal lives we plan vacations, activities, things (e.g. cars, houses, sponsorship) we always
make different-different plans based on a budget, in some cases we do it informally, without
hesitation 'to fix things. But we do, planning in effect which involves a series of steps to achieve a
detailed or predetermined outcome. In the case of planning for external environment, often the
business strategies are made with the help of systematic and ethical approach. We plan activities,
develop new services and products, new projects and programs. We also plan for trading systems,
doing things differently, making things happen in correct ways. We also discuss, write and deliver
short, medium and long-term plans about what, an organization, want to achieve, what its goals are.
Such programs are in developed with maps of an organization strategy that moves it from where it is
to where it wants to go in future. Strategic planning is something that makes a business successful,
from what it was in the 60's, which has gradually become one of the most important aspects of
modern business and organizational life.
PATH GOAL THEORY - Theory was developed with the help of Robert House and has its roots
within the framework of anticipation of the principle of motivation. The principle is based entirely on
the premise that an employee's belief in what they expect in their efforts and performance is strongly
influenced by the behaviour of the leaders. Leaders assist the organization's participants in winning
awards by clarifying the path to goals and removing barriers to performance of the teammates. They
do this by providing data, support, and various resources that employees may need in order to
complete the task.
There are four leadership styles in this concept:
• Directive: Here the leader provides guidance, informs subordinates, sets performance
standards, and controls behaviour when performance standards are not met. He uses the
rewards wisely and disciplines. Style is like a focus on work.

• Supportive: A leader is friendly to subordinates and shows personal interest in their needs,
welfare, and well-being. This style is similar to people-cantered leadership.
• Participative: The leader believes in team decision-making and shares information with
subordinates. Leader discusses with subordinates important career-related decisions, career
goals, and ways to resolve goals.
• Achievement oriented: The leader sets challenging goals and encourages employees to
achieve their highest performance. The leader believes that employees have a responsibility to
achieve challenging goals. This is similar to goal-setting theory.
Porter's generic Strategy
Porter's generic strategy is the business model that is used in evaluating how an establishment
pursue the competitive advantage. This can be done either by lowering the cost or make their product
different from their competitor. It focuses on two types either on offering their products to a selected
segment or to the whole industry.
The Porter's generic strategy is categorized into 3 types:-
1.Cost Leadership Strategy-This strategy states that when a company is offering lowest prices to the
consumers in order to reach the mass consumers in a short while, known as cost strategy This can be
done by lowering the fixed cost of the product or to utilise the resources at optimum level. The major
focus is on eliminating the excess cost that makes the product or services higher. Hotel Marriott focus
on minimising the cost which may not contribute in making the services better.
2. Differentiation Strategy-This strategy helps in making the products or services from other
competitors. It requires good research, innovation and development in order to make product/service
differ from other. Marriott focuses in making their service better and it also takes feedback from
customers. Differentiation may be in terms of standardization quality uniqueness of the product.
3.Focus Strategy-Focus Strategy may be defined as the process of marketing and selling of a product
to a particular market which may include type of consumer taste preferences or the geographical area.
The basis of Marriott is to provide the outstanding facilities along with customised and unique
services to the customers.

Strategic planning of MARRIOTT
Marriott Inc. Has loved a worldwide growth thru the purchase strategy. The organization
adopted this growth technique to consolidate its business in the hospitality enterprise inside the
worldwide marketplace. Mulherin, Netter, and Poulsen (2017) hold that the purchase is a market
manipulate mechanism that definitely impacts the results of the outside environment on an employer
and enables the exploitation of growth possibilities. The 2016 acquisition of Starwood Corporation is
the maximum big success in augmenting global dominance and setting up an aggressive product
emblem. Given that Starwood Corporation is a multinational hospitality firm with an established
consumer base, marketplace logo, branches, and distribution channels, it shaped a part of huge rival
companies within the hospitality industry. Therefore, its acquisition reduced the negative economic
effect of intense competition between the 2 corporations with the merger of their various branches,
main to the consolidation of their nearby markets below one logo. This approach undoubtedly impacts
Marriott’s worldwide growth and competitive role.
As technology keeps forming the global society, the hospitality industry faces competitive
pressures from new and installed corporations in these markets. The emergence of on line
corporations consisting of Airing has imposed a fantastic deal of marketplace competition on motel
companies. Marriott’s acquisition has facilitated the consolidation of assets consisting of know-how
from the two corporations, which increase performance, market size and sell manage of commercial
enterprise operations.
Marriott enjoys a large portion of the market with a lot of revenue from the South American
region. The organization has contributed to the growth of the market share in the global market
through regional penetration and growth, which includes the established order of business strategy in
North America, Africa, the Middle East and Europe.
The Company’s primary enlargement in Northern, Latin, and Caribbean America involved the
purchase of Starwood hotel, one among its essential competition within the American and worldwide
markets. Localized marketplace growth facilitates a business enterprise to establish a commanding
market proportion in the local marketplace, which enhances and stabilizes nearby growth. The
development of Marriott’s monetary electricity is important in supporting market enlargement
techniques in socio-economically challenged markets which include Africa and the Middle East.
In the European marketplace, the organization has availed its upscale plan with the goal to
establish a strong competitive area and make bigger its marketplace percentage. Since Europe
harbours stable economic surroundings, the market offers excessive demand for accommodations
centres. Moby lodges act as the enterprise’s European emblem in luxury and full-time service

segments. However, the purchase of Starwood lodge, an already hooked up worldwide agency,
notably motivated the organisation’s emblem within the European marketplace with an increase in
target share of two.2% to 3.4% of the region’s branded lodges.
Marriott’s acquisition of Pro tea Hotels and alliance with Ali-baba (an internet commercial
enterprise firm) has drastically elevated get right of entry to the African and Middle Eastern markets.
Improved monetary situations because of commercial improvement in these regions inspire consumer
spending and profitability of life-style-related groups. The enterprise’s expansion into those new
markets consists of the creation of AC Hotels through Marriott, Element, and EDITION
manufacturers to faucet into burgeoning opportunities in the tourism industry.
Summary- It is essential for the organisation to have a strategic planning for the organisation
in order to have a competitive advantage for the business enterprise.
Mission- To expand the business worldwide and serve best things to its customers.
Vision- To adopt the growth and have a successful in the hotel industry
Strategy- The product development can be adopted by the organisation in order to improve
in the services which is been offered by the organisation.
Tactics- The 4 p's is been discussed in the tactics of the strategic planning.
Product/ service- The best services are the luxury room and more concentration on the
sanitization facilities for the customers.
Price- The pricing strategy can be the use of the competitive pricing strategy in order to
attract customers.
Place- The distribution of the service all is all over the hotels where ever they are situated in.
Promotion- the various digital platforms and the use of the discount offers can be the
promotional strategy.
Evaluation- the Company can use the various monitoring strategies such as key performance
management.
CONCLUSION
From the above report it has been obtained that the business strategy is very important to run
a business smoothly. Business strategy has been defined as a purpose-oriented business plan and
movement, carefully designed and adapted for the aim of achieving success, recognizing and
exercising power, integration resources, finding opportunities, meeting complex situations and threats
of the business. A business strategy is a hard and fast of competitive actions and actions that a

commercial enterprise makes use of to attract customers, compete correctly, strengthening
overall performance, and attain organisational goals. The Pestle and Swot analysis explains
the macro internal and external factors of Marriott international. This analysis helps the
organisation in finding the factors which can impact the company.

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