Sales Development and Merchandising Report: Milestone Hotel Analysis

This report delves into the sales development and merchandising strategies employed by Milestone Hotel in London. It begins by examining the key components of the hotel's premium suite product, highlighting its unique selling points and features. The report then assesses market segmentation strategies, focusing on demographic segmentation to target high-income clientele. It further analyzes the factors influencing buyer behavior, including cultural influences, social factors, and Maslow's hierarchy of needs, and explores the advertising media used to promote sales, such as internet, television, and print media. The report also covers the use of external merchandising techniques like valet parking and complimentary services. The influence of design and layout on customer spending, the effectiveness of internal merchandising, and the evaluation of different promotional activities are also considered. Finally, the report evaluates personal selling techniques, the influence of operational design on sales revenue, and the key principles of a sales training program, providing a comprehensive overview of sales and merchandising practices within the hospitality industry.

Sales development and
merchandising

Table of Contents
INTRODUCTION................................................................................................................................3
TASK A................................................................................................................................................3
A) A discussion about the key components of the product at Milestone....................................3
B) Assessment on market segmentation in Milestone.................................................................4
TASK B................................................................................................................................................5
A) Factors affecting buyer behaviour at Milestone.....................................................................5
B) Advertising media used for sales in Milestone.....................................................................6
C) Use of external merchandising in Milestone.........................................................................6
TASK C................................................................................................................................................7
A) Influence of design and layout on customer spending in Milestone.....................................7
B) Review and evaluation of the effectiveness of internal merchandising in Milestone...........7
C) Evaluation of different promotional activities in Milestone.................................................8
TASK D................................................................................................................................................8
A) Evaluation of personal selling techniques in Milestone.......................................................8
B) Influence of operational design on sales revenue in Milestone............................................9
C) Key principles included in a sales training programme in Milestone....................................9
CONCLUSION..................................................................................................................................10
REFERENCES...................................................................................................................................11

TABLE OF FIGURES
Figure 1 Type of market segmentation.................................................................................................5

INTRODUCTION
Development of sales is referred to as increasing transaction activities of a company with the
help of marketing. It is also termed as an action for business to sell its product or services to the
customers as well as business clients. Sales is a process to earn revenue and profitability for the
company (Altinay, Paraskevas and Jang, 2015). In the hospitality industry, selling is referred to as
the disposal of products to the customers. This is done to achieve customer loyalty as well as
satisfaction. On the other hand, merchandising is an activity done by the hotelier to promote the
sales of its services (Brue, 2015). The present research studies sales development and
merchandising technique for Milestone, London. Focus has been given on product components,
market segmentation as well as the factors affecting buyer behaviour. Other than that, concept of
merchandising has also been emphasized.
TASK A
A) A discussion about the key components of the product at Milestone
Product is a substance produced or manufactured by an organisation. They are created so
that company can sell them and make profits. Product can be also be termed as an idea designed by
the company to lure customers (Awang, Abdul Aziz and Samdin, 2015). On the other hand, service
is a type of effort generated by the company to achieve customer satisfaction. In the hospitality
industry, products can only be sold with the help of service. There are various elements of product

(Cates, 2015). These are as followed-
 Core product- This refers to the benefit received by the customer when he/she purchases
products from Milestone. Customer expects to receive this satisfaction as a form of good
service form the hotelier. For example, Milestone’s main product is related to provide
accommodation to the guests and tourists (Mora, 2016). The hotel provides best class
accommodation and quality services to the customers.
 Facilitating product- This helps consumers to use the core product. Hotel assists consumer to
consume the core product. Like, in the room service provided at Milestone, customer can
easily order food and other items with just a call away (Brotherton, 2015).
 Supporting product- This adds value to the core product i.e. they serve as facilitators to give
convenient for the consumers in order to use the product. For example, Milestone provides
complementary drinks to the guests and welcomes them by giving mementos (Lynch, 2015).
These services add value to the core product which is accommodation.
 Augmented product- Augmentation helps to increase sell for the hotel industry. This product
involves addition of an intangible benefit of the product along with its packaging
(Schuckert, Liu and Law, 2015). It helps retailer in achieving competitive advantage in the
market. For example: electronic customer relationship management. Customer cannot see or
feel such type of benefit. But, they can book and avail Milestone's services through using
online website of it.
The chosen product for merchandising and sales development is the premium suite of
Milestone (Product mix and Product line, 2016). The USP of this product is that company will be
able to sell many services in the same suite itself. The suite will provide Wi-Fi facility with a coffee
brewer. A wireless broadband connection will also be available for the customers. Personal printer,
video conferencing, international direct dial up line, DVD/CD players and in house music library
will be accessible by the guest 24/7. At the time of arriving in the premium suite, guests will be
given welcome beverage along with 24 hour butler and maid service (Cameron and Green, 2015).
Female friendly services will be available like security staff outside the suite. Apart from this,
splendid architecture and breath taking view of Kensington garden will lure customers. World
famous perfumed soaps, trendy bathrobes, fresh fruits, flowers, magazines, daily newspaper and
bottled mineral water will be provided to the guest.

B) Assessment on market segmentation in Milestone
Segmentation is a type of strategy to divide market into small segments. The market is
segmented into groups depending upon the specification of product (4 Types of Market
Segmentation, 2016). Segmentation is divided into-
Figure 1 Type of market segmentation
(Source: Khan, 2016)
 Geographic
 Demographic
 Psychographic
 Behavioural
In order to sell premium suite services and increase distribution, it is vital for Milestone to
segment the market. In respect to that, organization has chosen demographic segmentation strategy.
In this strategy, market is segmented based on age, gender or income level of consumers. In this

strategy, factors of productions and selling depend on the target market only (Dhiman and Anand,
2015). For example, “what has to be produced”, “how to produce” are determined which are based
on the needs of consumers. It is appropriate for the company to choose universe size of target
customers for this strategy. Thus, Milestone has targeted royal income group to sell its product
(Lashley, 2015). This is because the company wants to target premium class customers who want
luxurious services while staying in the hotel.
Market segmentation contributes in sales maximization in the following way:
1. Segmentation helps marketer in understanding the needs and income level of consumers.
This is done by closely understanding the targeted segment in the market, thus it assists in
raising revenue by targeting right customers (Chang and Hou, 2015).
2. To increase the efficiency of marketing activities, it is important to segment the market.
This facilitates in improving customer awareness which leads to repeat purchase. By doing
this, customers feel satisfied towards the company’s products and services.
TASK B
A) Factors affecting buyer behaviour at Milestone
The economic model of buyer behaviour states that with a limited budget, consumers will be
able to effectively use their money. The buyer will purchase first which is the most important and
will not spend on unnecessary things. This model is based on price effect, income effect and
substitute effect (Altinay, Paraskevas and Jang, 2015). It is a traditional method in which consumers
purchase as per their budgeted economic limits only. Their taste and preferences are affected by
their income and low price of substitute products.
There are various factors that affect buyer behaviour in the United Kingdom. These are as
follows:
1. Cultural significance like values, beliefs and perception of the society affect buyer's buying
behaviour (The factors influencing consumer behaviour, 2015). A consumer will not
purchase any product which is termed inappropriate by the society.
2. Factors like society and income levels also influence consumers. If, a large group of
customers are not able to purchase luxury goods then company will not sale their services in
that particular area (Schuckert, Liu and Law, 2015).
Maslow's hierarchy of needs was formulated by Maslow in 1943. As per this theory, when
one need of consumers are fulfilled then only they will want to accomplish their next state of needs.
This theory states that at first, consumer will fulfil their physiological needs like food, shelter
clothes (Gurol and Bilen, 2015). For that, they will purchase these basic items first than any other
products. After achievement of this level, buyers will focus on their safety needs i.e. products like

insurance. After that, social needs come on the third level. Consumer will want to spend on friends
and family only after they achieve their basic needs. Self-esteem and actualisation needs will be
fulfilled only when buyers earn on a good level and spend most of them.
Consumer's buying process is a decision making process made by the buyer while
purchasing a product. Consumers identify what they really needs and attain complete information
about that service. Further, they evaluate alternatives like a cheap product or a better brand
(Mohammed, 2015). After this, they decide whether they want to purchase the product or not. After
purchasing, consumer expects from company to provide them after sale services like guarantee and
warranty.
B) Advertising media used for sales in Milestone
Advertising is a way of communicating promotional messages to the consumers. It is used to
advertise company’s products in the market. Advertising encourages and lures the customers to buy
a certain service designed by the company. Advertising is performed with the help of media like,
newspaper, magazines, mailing, phone advertising, online advertising, billboards and TV. Internet is
the most important media of advertising (Kang, Tang and Fiore, 2015). It is effective as it has global
reach. Consumers can book and find information about Milestones products through its online
website itself. Television is another median which helps company to market its product through
advertisements. Print media like use of ads on newspapers and magazines also helps hoteliers to
grab consumer’s attraction (Gurol and Bilen, 2015). Milestone flashes ads on the newspaper and
provides detailed information about company’s services in them. Radio is another tool which is
getting popular these days. In this type of media, hotel creates a vocal advertisement messages
which is played by the radio channel over a period of time. As the message is audible for the
consumers, so they can easily relate to the appeal of Milestone (Melián-González and Bulchand-
Gidumal, 2016). Brochures and templates are also distributed by the hotel in order to market
premium suites among customers. Direct mailing and phone calls are also done to the customers in
which telemarketer provides vocal information to them. These methods are effective as they are
designed to directly appeal the customers.
C) Use of external merchandising in Milestone

Merchandising is a way to increase sales of company through promotion of goods and
services. It includes techniques that help in enhancing the sales of hotel. External merchandising in
context of hospitality industry includes services provided to benefit the extraneous components of
Milestone. For example, Hilton hotel provides valet parking facility as well as ease of access. Hotel
is situated at a very prime location i.e. it is accessible from the nearby airport (Mohammed, Guillet
and Law, 2015). Customers feel satisfied and impressed with the valet parking facility. As compared
to other hotels, these services are free at Milestone (Altinay, Paraskevas and Jang, 2015). Apart
from this, external merchandising in context to hospitality industry is the availability of
complimentary services on guest arrival. To facilitate customer satisfaction, Hilton also provides
different continental food to the customers. This helps guests to explore wide range of food menu
in Milestone. Further, display window of the hotel shows exemplary art and brilliant infrastructure
of the hotel. External merchandising plays a vital role in maximizing customer volumes as it helps
in attracting customers (Noone and Maier, 2015). These activities contribute in increasing the sale
of premium suites in Milestone hotel. Area of the hotel promotes customers activity. Although these
activities enhance sales but it is also true that they are an additional cost factor to the hotel. By
doing this, Milestone enhances the manner by which it presents its products and services.

TASK C
A) Influence of design and layout on customer spending in Milestone
Customer ergonomic is the way through which customers interact with the design and
infrastructure of a hotel. Hospitality industry plays great emphasis on designing the interiors as well
as exteriors of Milestone hotel. These factors influence consumer buying behaviour. Infrastructure
is the first and foremost thing which a consumer sees when he/she enters in the hotel. Here, targeted
customers are those who can afford luxuries facilities and prefer premium delivery of services. If,
hotel is beautiful and magnificently designed then consumers will be easily attracted towards it.
Milestone hotel believes in creating a beautiful environment with the extra ordinary design of their
lobby, windows, balconies, auditorium, conference room, event hall and restaurant. Due to this,
customers will be lured to stay in the hotel (Tang, King and Kulendran, 2015). Further, the
ambience and surrounding of hotel are very magnificent. This encourages and generates positivism
in the guests. They will feel highly relaxed and calm due to the same. However, the lightning is
bright in the evening and dim after 12 in the night whereas in the morning, windows are opened so
that natural sunlight can enter into premises (Schuckert, Liu and Law, 2015). This makes the view
very panoramic and makes the consumers comfortable. The fragrance around the hotel is always
pleasant. This lifts the mood of guests and helps Milestone in achieving higher customer
satisfaction.

B) Review and evaluation of the effectiveness of internal merchandising in Milestone
Being a part of hospitality industry, it is relevant for Milestone to provide internal
merchandising to raise customer's experience. Internal merchandising refers to the use of wall
paintings, colour palette, furniture, carpet, wall ceilings, chandelier, windows and use of glass. In
simple words, the entire surrounding and ambience of Milestone must be designed in a way that it
must easily attract customers. Guests must be able to feel mesmerized with the interior designing.
Apart from this, Milestone focuses on enhancing the cultural significance of United Kingdom. The
traditional aspect of country has been maintained to show guests about the vastness in their
countries culture (Rosenbaum and Wong, 2015). Milestone has initiated to reflect the concept of
place through their infrastructure. Each premium suite is designed with a different concept. For
example: the Buckingham suite, Princess site, Viscount Suite, Superior and etc. Apart from this,
guests who want to experience adventure are booked for safari suite. The internal merchandising in
Milestone is overwhelming and magnificent experience given to the customers. This is possible as
the entire hotel is designed by adhering to sophistication and luxury. Thus, it can be evaluated that
internal merchandising helps in raising sales and increasing customer traffic to the Milestone
(Dhiman and Anand, 2015).
C) Evaluation of different promotional activities in Milestone

Promotional activities are events designed to advertise and market Milestone's products and
services. In order to enhance sales prospects of the hotel, management chooses various promotional
techniques. Among them, the most popular technique is social media. Millstone advertises about its
products and services on Facebook, twitter, YouTube and Instagram. In this, the organization is able
to directly connect with the customers. The mass appeal of social media website is wide spread and
highly followed (Altinay, Paraskevas and Jang, 2015). Advertisement in magazines and newspaper
helps to create customer’s attention as well. For examples, ads on particular life style and travel
magazines helps customer to locate the brand. Milestone highlights information about its
infrastructure and services in a brief manner in these ads. Display ad's on the banners and hoardings
is the easiest way to sell a product amidst customers. This is done so as to directly catch the
attention of customers. Hoardings and banners are generally placed in malls, or on busy roads or in
subways. Such evaluation shows that use of different activities helps to cover a large market size in
the hospitality industry.