International Hospitality: Marriott Hotel's Emerging Market Strategy

This report provides a comprehensive analysis of Marriott Hotel's international hospitality strategy, with a particular focus on entering emerging markets. It begins with an overview of the international hotel and tourism industry, highlighting its economic significance and growth trends. A SWOT analysis of Marriott Hotel West India Quay identifies its strengths, weaknesses, opportunities, and threats, emphasizing brand recognition and challenges in international expansion. The report then delves into the global hotel and tourism industry, comparing developed and emerging markets, with a specific focus on China. A PEST analysis of China examines the political, economic, social, and technological factors influencing the hospitality sector. Finally, the report proposes and justifies a strategic model for Marriott Hotel's entry into the Chinese market, outlining practical applications and future projections. The analysis leverages strategic frameworks to provide actionable recommendations for Marriott Hotel's expansion strategy.

TRAVEL AND HOSPITALITY MANAGEMENT INTERNATIONAL
HOSPITALITY
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Table of Contents
Background to International Hotel Industry (and tourism)........................................................3
Background to Hotel Company (Hotel name Marriott Hotel West India Quay........................3
SWOT analysis of selected hotel company................................................................................4
Weaknesses................................................................................................................................5
Background to Global Hotel and Tourism Industry – developed and emerging markets..........6
Background to Emerging markets..............................................................................................8
PEST of selected emerging market............................................................................................9
Analysis of PEST.....................................................................................................................10
Hotel strategy to be adopt and to be implemented (using strategic model and frameworks)
within the entering market.......................................................................................................12
Justification of strategy............................................................................................................15
Practical application of strategy – 5 and 10 years ahead.........................................................16
Conclusion................................................................................................................................17
Reference list............................................................................................................................18
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Background to International Hotel Industry (and tourism)
Travel and tourim industry is considered as one of the most the growing sector in the world.
Business travels from many countries are expecting for the business to grow in the coming
years. Travel and tourism sector has become as one of the key sector for the economic
development. As per the reports, in the year 2016, the travel and tourism has contributed
more than US$2.3 trillion. It has also provided around 109 million jobs worldwide. In the
year 2017, the total contribution of the travel and tourim industry to the world economy is
likely to grow by appromixmately 3.5% (Wttc.org., 2018). China has the maximum outbound
travel expenditure in the world . In addition to this, due to the demand travel and tourism
industry, there has been growth in the hotel industry. The hotel industry provides meals,
accommodation and personal services to both the permanent and public residents. With the
help of the travel and tourism industry, the infrastrucrtrue of the country has developed. This
has helped in attracting more numbers tourists from different parts of the world.
Background to Hotel Company (Hotel name Marriott Hotel West India Quay
Marriott Hotel West India Quay is a luxury 5-star hotel in London, England. The hotel is
owned by the property developer John Christodoulou. In addition to this, the hotel is
operated by Marriot hotel group. There are more than 301 rooms. The hotel is located at 22
Hertsmere Road, Canary Wharf. The hotel provides many services to the customers, which
has helped it to retain its loyal customers. The hotel offers handcrafted cocktails at G&Tea
(marriott.co.uk, 2018). The company also provides resorts for various purposes. The hotel
also has meeting rooms for business personnel. There is also fitness and resreation for its
customers.
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SWOT analysis of selected hotel company
The SWOT analysis of Marriott Hotel West India Quay is listed below,
Strengths
 Effective brand recognition: The Marriott Hotel West India Quay is one of the
leading luxury five star hotels that have a good market reputation within their
domestic market. This hotel remains governed by the group of Marrott Hotels group
as well as this hotel has 301 rooms in their organization (Marriott International,
2018). This hotel has mastered the vintage and traditional methods of welcoming their
guests from all over the country and globe. Therefore, it could be said that effective
brand recognition among their customers is strong (Marriott International, 2018).
With the help of the brand value, the hotel is able to attract more number of
customers, which has helped it to attract more number of customers.
 Efficient worker retention: As stated in the above section of this SWOT analysis of
Marriott Hotel West India Quay, this organization has around 301 employees working
in their branches across their domestic market as well as across the globe (Marriott
International, 2018). They have achieved remarkable growth in their employees’
retention policies over previous years. Employee satisfaction as well as work life
balance of this company is remarkable.
 Experience in hospitality industry: From several sources, it is documented that this
hotel is experienced in providing their customers an exceptional hotel experience as
well as impeccably design and suitable location of this hotel is enhancing their brand
value to the customers and tourists (Marriott International, 2018).
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Weaknesses
 Less international expansion: This organization has effective market expansion in
the United Kingdom but this organization has limited access in the emerging market.
This is a potential threat for this hotel company as the emerging market is profitable
to expand hospitality operations (Marriott International, 2018).
 Narrow market share: Since, this organization has less expansion in the emerging
market, they only have strong market hold in the domestic market but their market
share and old in respect of emerging market is low (Marriott International, 2018).
Opportunities
 Strong work culture: The company has practiced as well as nurtured a multicultural
workforce within their organization. Almost 26% of the hotel staffs are minorities and
around 47% of the employees are women (Marriott International, 2018). Two
outreach initiatives of this organization are helpful for attracting more suppliers and
customers.
 Organizational expansion in emerging market: This organization could enhance
their organizational efficiency if they develop their operations in the emerging market.
Threats
 Changing economic and political conditions: The changing political and economic
conditions within UK are affecting the current operations of the hotel industry and
Marriott Hotel West India Quay (Marriott International, 2018). This organization is
facing problems due to the changing political decision of UK government regarding
Brexit and the economic recession. The country is also having bad relation with the
other Asian countries. In addition to this, the hotel has to analyse the political
condition, which can affect the business of the hotel.
 Increasing market competition: As the travel and tourism industry within UK is
developing, so the current market completion between them. Therefore, this hotel is
also facing market competition significantly (Marriott International, 2018). This
market competition is affecting the profitability and performance level. The hotel has
to make some strategy, which will help the hotel to compete with its competitors. In
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addition to this, the hotel also has to provide offers and discounts that will help in
attracting more number of customers.
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Background to Global Hotel and Tourism Industry – developed and emerging markets
The hospitality industry is one of the leading industries with a global financial contribution of
around 7.6 trillion U.S. dollars according to the financial report of 2016 (Lu, 2018).
According to the financial review of global hospitality industry, the direct financial influence
of this sector, involving transportation, attractions, accommodations, was around 2.3 trillion
U.S. dollars in 2016. A number of countries like UK, France and others are constantly
popular travel and tourism destinations, but less popular countries are also emerging to
collect financial benefits of this sector (Vanhove, 2017). As per the growth ration, this
industry would a significant status and contribution to the business economies of different
nations across the globe by 2022.
Key findings related to the emerging market
According to the current position of the developing travel and tourism industry across the
world, it could be said that among all other emerging countries, China and India have the
potentiality to reach to the leading position in recent years (Ghosh et al., 2018). These two
countries would continue to develop year-to-year growth that is equal to or may be greater
than the United Kingdom, Japan or France. On the other hand, penetration of the domestic
tourism markets in India and China would yield the maximum long-term returns for global
brands. The mid-markets, budget sectors are still dominated by the local brands in emerging
countries. The Indian government has recognized a shortage of approximately 150,000 rooms
along with most of the under-supply going on in the budget industry (Bazalgette, 2017). Both
the emerging markets mentioned in the above part of this study are at risk of an over-supply
of comfort hotels in the core tourism locations at least in the short term. Concisely, it could
be said that over the past few years, around 2 million of the total population had joined the
middle class of the country.
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Figure 1: Emerging markets in travel and tourism industry
(Source: Mowforth and Munt, 2015)
Current trends in travel and tourism industry
The current trends in the hospitality industry is documented below,
 Developing number of destinations has expanded up a vast area that is invested in
travel and tourism. It could turn into the drivers of socio-economic process along with
the assistance of jobs, export revenues, creations and others (Mariani et al., 2014).
 As per the current market situation, travel and tourism industry has experienced
international expansion therefore; it has become one of the leading financial industries
of the world (Mariani et al., 2014).
 Currently, global travel and tourism industry represents around 7% of the exports of
products as well as services.
 According to the global export category, this hospitality industry ranks as third after
the fuel and chemicals sectors (Mariani et al., 2014). On the other hand, in many of
the developing countries, travel and tourism industry ranks as the first industry of
export.
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Background to Emerging markets
As instructed in this study, between the two underlined emerging countries China has been
selected from the “WTM 2016 Industry report and UNWTO Tourism Highlights 2015”
(Corrêa, 2016). Expanding business into this sector would be helpful for Marriott Hotel West
India Quay to develop their organizational revenue and overcoming organizational
weaknesses (statista.com, 2018).
The hospitality has become a significant contributor to the domestic economy in this country
since the initial stage of reform. The appearance of an affluent middle class as well as a
reduction of movement restrictions for foreigners and locals are both supporting this
hospitality boom.
Figure 2: Chinese travel and tourism market condition
(Source: yuan, 2018)
According to the above figure regarding the contribution of Chinese market to the national
GDP, it could be said that the Chinese travel and tourism market has developed into one of
the world’s most visited outbound and inbound tourism markets (yuan, 2018). The number of
inbound trips within this country would develop to about 2.38 billion visits in 2020, involving
an enhancement of over 50% compared to the number of visits made within this country in
previous ten years ago. The total organizational revenue of China hospitality industry
developed to 3.94 trillion yuan as of 2016 as well as over 15.2% compared to the earlier year
(yuan, 2018).
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PEST of selected emerging market
Political: The political environment of China is divided into two sections, inner political
environment and outer political environment.
 Inner political environment
Currently in China the CNTA banned the commissioned sale of various travel and
tourism products. Before the year 2013, it is a common practice in this country to sal
the packaged tourism products at competitive price rates by various Chinese travel
operators (Riunet.upv.es, 2018). This process compel travellers to shop from the
market to ensure commission from the “partner shops”. After the new law passed by
the government in 2012 and implemented in 2013, all the travel operators are
prohibited from gaining illegitimate commission as well as providing travellers
unreasonably low price tours. Outer political environment
Opening of the free trading zone for travel and tourism business as well as the boosting
outbound tourism of china by deleting complication from the visa facilities of their citizens
are remarkable examples of governmental decision-making that are helpful for effective
growth in China (Riunet.upv.es, 2018).
Economic:
 Customer confidence
This criteria is expressing the fact that Chinese economy is really growing over the past
two years due to the emerging market of Chinese travel and tourism business.
 Taxation
The developing exchange value of Chinese currency is impactful for the travel and tourism
business in this country (Riunet.upv.es, 2018). Due to the rising exchange money, Chinese
people are gaining confidence of travelling outside their country, which is useful for their
tourism development.
Social:
 New money concept
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This concept is showing the fact that Chinese economy is gradually developing and
according to the current scenario, the financial condition of this country is highly developed
and the people are deliberately purchasing the high-end tourism products that the travel
operators are offering (Riunet.upv.es, 2018).
Technological:
 Development in the information technology
Development in the information technology helps this country to develop efficiency level of
their travel and tourism sector. As almost 91% people are engaged in internet on a daily basis,
travel and tourism operators are promoting their products through internet and online
platforms to reach to more potential consumers (Riunet.upv.es, 2018).
Analysis of PEST
According to the above PEST analysis regarding Chinese emerging market, it could be said
that presently, the marco market has the potentiality to become an effective ground for high-
end sector. Firstly, the Chinese government is really careful about protecting cousmer
interests, which is good sigh or the inbound tourists as well as the outbound one
(Riunet.upv.es, 2018). On the other hand, various other countries are facilitated in expessing
visa proceses for Chinese travellers so, the high-end travel and tourism industry development
could be accelerated in outbound as well as inbound market easily. Therefore, operating in
this emerging country as well as in their travel and tourism industry could be affordable for
Marriott Hotel West India Quay.
As per the economic and social conditions expessed through the PEST analysis, it could be
assumed that number of affluent citizens are developing in a rapid pace and well-established
people are willing to pay money on tourism in vacations both in the domestic as well as
international tours (Riunet.upv.es, 2018). Therefore, the high-end tourism development could
be accelerated and Marriott Hotel West India Quay could be helpful in establishing their
tourism operations in this emerging country. This organization has the opportunity to build
strong hold on the domestic and international market through the developing economic and
social conditions.
The technological advancement in the information technology ground such as Wechat
messaging facilities are helpful for this organization to promote their products through this
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online platform and achieve a strong consumer base. This kind of developments in the
emerging market like China is projecting the fact that travel and tourism business is really
important for a country to entirely develop their strength and economical development. The
PEST analysis cited above is expressing the same fact (Riunet.upv.es, 2018). On the other
hand, except all these initiatives, the government and various travel and tourism operators
should be careful about taking care of sustainability issue in travel and tourism business as
this a impactful and important phenomena in this kind of high-end businss.
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