TOUR 335: Industry Analysis Report for Prestige Holdings Group

This report provides a comprehensive industry analysis of the hotel and motel sector, focusing on the British Columbia market. It begins with an industry description using the NAICS code 721111 and details economic traits such as market size, growth rates, and capacity utilization. The analysis explores competitive forces, including rivalry, new entrants, and the bargaining power of buyers and suppliers. It also examines forces of change like product and marketing innovation, and technological advancements. Key competitors, such as Marriot Hotels and Pangea Pod Hotel, are evaluated in terms of their strategies and competitive moves. The report identifies critical success factors, assesses the industry's attractiveness, and concludes with strategic recommendations for Prestige Holdings Group, emphasizing the importance of technology and market research for successful market entry and expansion. The bibliography includes various sources like booking.com, Marriott, and government statistics.

Strategic Management

Introduction
Industry description
NAICS Code: 721111
NAICS code description: The NAICS code is applicable for hotels and
motels. The industry comprises of establishments that are engaged
in providing short-term lodging. The establishments associated
with the industries provide food, beverage, parking and other
services
Geographic focus: British Columbia
Number of business: 1,300 (booking.com, 2019)
Number of persons employed: 21,440
Contribution to GDP: 3.00% or USD$6,072

1. Industry’s economic traits
Number and market size of the
industry and competitors
Growth rate in terms of segments and effect on
competition
Growth cycle and levels of
profitability
Capacity utilisation

Contd..
• Channels of distribution: Social media, emails, Online Travel Agents.
mobile applications
• Product differentiation: Economic service provided, mostly done by the
method of acquisition, can provide up to 100 rooms both luxurious and
regular with facilities for room service. Located near the historical
landmarks near British Columbia like Fort Steel Heritage Town
Economies of scale

2. Competitive forces in the industry
• Rivalry among existing firms: High threat as each of the companies
are unique and compete to gain advantage in the market
• Threat of new entrants: Medium threat mainly due to the
dominance of existing hotels with an industry profit of $2 million
• Threat of substitute of product and services: Medium threat with
substitute in the form of residing in motels or bed and breakfast.
Prices in such places is low but lack the luxury
• Bargaining power of buyers: Medium threat however, buyers are
price sensitive and prefer switching costs by checking the quality
• Bargaining power of suppliers: Low threat due to low switching
costs. The main suppliers are property owners as well as technology
manufacturers and labor

Contd..
Rivalry among
existing firms
High
Threat of new
entrants
Medium
Threat of substitute of
product and services
Medium
Bargaining
power of buyers
Medium
Bargaining power

3. Forces of change in the industry
• Product innovation: Product innovation in the modern world is important as it
signifies the uniqueness and the variety of services or products that exist
within the industry
• Technological change: In the modern world, technological change refers to
updating technologies. The use of mobile applications for attracting customers
can be taken into consideration as a mode of technological change
• Marketing innovation: Innovative approach in terms of marketing research
need to be considered so that changes in the marketing mix elements can be
made
• Changes in cost and efficiencies: Prices need to match with the demand of the
middle class people so that opportunities for more sales can take place
• Regulatory influences: Government rules in terms of accommodation of
property as well as room rates need to be maintained based on total GDP of
the country
• Changes in societal norms: Upgrade in terms of services that may suit the
lifestyle of the customers need to be taken into consideration

4. Strongest and weakest competitors
• The strongest and weakest competitors of
Prestige Holding Group includes some of the
finest and reputed hotels across the world
• The strongest among the competitors is Marriot
Hotels which is famous all over the world
• The weakest competitor can be Pangea Pod
Hotel which is mainly famous in the local region
of British Columbia

Contd..
• The strategy adopted by Marriot Hotels is of
acquisition of the rival firms and to increase the
growth of the hotels via organic development
• For Prestige Holding Group the strategy obtained is
related to buying more market share and conducting
market research so that prices can be aligned
• The strategy for Pangea Pod Hotel is to device plans
so that it can establish its hotels outside the British
Columbia via merger or acquisition

Contd..

5. Likely to make the competitive move
• Based on the analysis, it can be said that the
competitive move can be made by Marriot in
terms of being the most successful hotel chain
• The move towards an international market can
be likely for Prestige Holding Group mainly due
to the high rate of profitability it has over its
weakest competitor
• However, it needs to be careful in terms of its
financial status in the business

6. Key factors to determine success or
failure
• Three industry factors that have a strong
relationship with success includes changes in
the service type, technological change as well as
innovation in the product and market
• The variation in the industry norms can be
related to the category utilisation of the rooms
of the hotels and the manner in which economic
factors can be of assistance for the hotels