Sales Development Report: Ritz-Carlton Hotel's Home Automation Service

This report provides a comprehensive analysis of sales development strategies, focusing on the Ritz-Carlton Hotel and its home automation service. It begins by exploring the key components of a product, including core benefits, the actual product, and augmented features, and discusses how the product mix can maximize sales and profit. The report then examines the role of market segmentation, considering demographic, geographic, psychographic, and behavioral factors in tailoring marketing strategies. It delves into factors affecting buyer behavior, including cultural, social, personal, and psychological influences. Furthermore, the report assesses various advertising media, such as magazines, hoardings, and social networking sites, evaluating their effectiveness in promoting the hotel's services. It also discusses the use of external merchandising to maximize customer volumes, store design, and layout influences, as well as the effectiveness of internal merchandising and promotional activities. Finally, the report evaluates personal selling techniques, the influence of operational design on sales revenue, and the key principles for a sales training program, concluding with a summary of the findings and recommendations for sales development.

SALES
DEVELOPMENT

TABLE OF CONTENTS
Introduction......................................................................................................................................4
Task A..............................................................................................................................................4
1.1 & 1.2 Key components of a product and role of product mix in maximization of sales and
profit.............................................................................................................................................4
1.3 Contribution of market segmentation for maximizing sales..................................................5
Task B..............................................................................................................................................6
2.1 Factors affecting buyer's behaviour.......................................................................................6
2.2 Assessment of advertising media used for sales development..............................................8
2.3 Use of external merchandising to maximize customer volumes...........................................9
Task C..............................................................................................................................................9
3.1 Store design and layout influence customers.........................................................................9
3.2 Evaluation of the effectiveness of internal merchandising..................................................10
3.3 Evaluation of different promotional activities.....................................................................10
Task D............................................................................................................................................11
4.1 Evaluation of personal selling techniques............................................................................11
4.2 A discussion about the influence of operational design on sales revenue...........................12
4.3 Key principles that should be included in a sales training programme...............................13
Conclusion.....................................................................................................................................13
References......................................................................................................................................15
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ILLUSTRATION INDEX
Illustration 1: Factors Affecting Buyers Behaviour.........................................................................7
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INTRODUCTION
Sales development is a process of growing and progressing the sales of a company using
the external as well as internal tools and techniques. It is one of the most important process in an
organization which can build so that organization can deliver a product which can have
consistent and efficient revenue (Gomes, 2015). This report describes the sales development of
home automation in Ritz-Carlton Hotel. The Ritz-Carlton Hotel Company, L.L.C. is the parent
company of the luxury hotel chain. Focus of this report is on the understanding the elements of
the product in a business and also on the external sales development techniques. Furthermore,
discussion has been made on the understanding of tools and techniques of sales promotion
internally and the ability of a company to evaluate the role of employees in maximizing sales of
new innovative service of home automation.
TASK A
1.1 & 1.2 Key components of a product and role of product mix in maximization of sales and
profit
Ritz-Carlton Hotel is luxurious hotel of UK and it has recently developed a new service
of home automation in all the rooms of their hotel. Thus, discussion has to be made on a key
components of a product or service (Hassanien, 2006). Key component is also refers to as
product mix. Actually a product is simply a market offering which a consumer wants to purchase
or consume so the consumable part is more focused by the organization because total product
consist of what is consumed or in this case services rendered. Total product offering can be
separated into three part which is simply a component of the product:
1. Core Benefits: People make buying decisions in order to satisfy their need. But many
needs are identified after consuming the products. In some cases, core product is the
benefit which customer receives from using the product. Sometimes, core benefits are
offered by the product itself or sometimes in other aspects the benefits are offered. In
home automation service, core benefits are offered in another aspect that is it saves time,
help consumers to give any order in just one click, can feel secured in the hotel rooms,
etc. (Maxwell and Lyle, 2002). Thus, key decision of rendering a service of Ritz-Carlton
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Hotel is determining the core benefits a product will provide. Product offering can be
developed from this decision.
2. Actual Product: Core benefits can be offered through the components which make the
actual product that customer purchases (Judson, and et.al., 2006). Consumable product
lies within the actual product which can be viewed and felt and it is the main product
which consumer is buying (Lewis, Passmore and Cantore, 2008). Marketers should
understand that while the consumable product is the most critical of all product decisions
but the actual product includes many separate product decisions which includes product
features, branding, packaging, labeling, etc. According to the case, Hotel Ritz-Carlton is
the actual product and consumable products is home automation services which will
facilitate the visitors to render other services in an easier manner. So the product should
be designed in such a way that it attracts the customer.
3. Augmented Product: These are consider as an additional value along with the product
purchased. These are not the key benefits which leads the customer to purchase. The
inclusion of these items in a product strengthen the purchase decision. Items included in
augmented product are guarantee, warranty, customer service, complementary product
and accessibility (Maier, 2012). In this case, home automation is the augmented product
which attracts the customers to visit the hotel. That is it enables the customers to
automate the room services in just one click. Moreover, through this customers can
secure their room system and they get a smart phone along with that so that they can
access their room from outside the hotel too.
The product mix of home automation may help in increasing the sales and profit of the
Hotel Ritz-Carlton. If product mix is offered in a proper manner and each component is
described than it will increase the sales of the company because customer will render the service
because it contains all the components of a product mix. If sales will get increase then eventually
it will lead to generate more and more profits.
1.3 Contribution of market segmentation for maximizing sales
Market segmentation is a type of marketing strategy in which a whole market is divided
into small subsets of consumers which have common needs, interest and priorities (Mungall and
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Labben, 2009). Segmentation is done on 4 basis demographic, geographic, psychographic and
behavioral.1. Demographic Segmentation: It means segmenting the market on the basis of age, gender,
annual income. The groups are made in which people are of similar age group or income
group or of same gender.2. Geographic Segmentation: In this market is segmented on the basis of country, states,
region, area. Customers are segmented country wise and according to their culture and
beliefs, marketing strategy are implemented.3. Pshycographic Segmentation: It is based on the lifestyle of a consumer. In this, living
standard of consumer and their way of life is being considered
4. Behavioral Segmentation: This segmentation is done by considering the values,
perception, attitude of a consumer. That is how customer perceived the particular product
or services and values of customer does not hurt while promoting the product or services.
Ritz-Carlton has segmented its market on these 4 basis. In demographic it has segmented
on the basis of annual income because services oof this hotel is relatively of higher price so it can
be rendered by high income group people (Oborin, 2013). This hotel is globalized so geographic
segmentation is done country wise. The high living standard people will visit the hotel according
to their lifestyle and perception, value of people differs in different country so accordingly the
marketing strategy has to be implemented. The segmentation of market will help the hotel to
design the marketing strategy accordingly. In demographic it can target those people who are of
higher income group so marketing will be done to those people only by the way of ads in
business magazine, air magazines, by the way of email, hoarding, etc. In geographic
segmentation company can segment its market country wise and marketing strategy should be
different in different countries. Ritz-Carlton should take due care about the culture and society
and then design its strategy. As per the lifestyle of higher income group consumer of different
countries, the strategy should be developed.
This will help the company to achieve its goal of sales maximization because through this
company can focus on each group of consumers and their needs can be satisfied in a proper
manner (Peters, 2014). Thus it will attract more and more consumers, hence, maximization of
sales will be achieved. Like this, market segmentation helps in maximizing the sales.
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TASK B
2.1 Factors affecting buyer's behaviour
There are 4 factors which affect the behaviour of customers.
(Source: Factors Affecting Consumer Buying Behaviour., 2015)
Cultural Factor
This includes the culture, subculture and social class of the consumer. These factors are
often inherent in the values and decision process. Because people are influenced by their family,
friends and outside environment which teaches them values, perception and also a common
behaviour of their culture. Culture is the most important detriment of a people wants and
behvaiour. It is a set of beliefs and values which are shared by the people within a group. Each
culture is consist of smaller sub culture which gives more specific identification for the group
members. Subcultures are the nationalities, religion, ethnic groups, age group, etc. consumer
behaviour is determined by the social class to which they belong (Tamilia, 2007).
Social Factor
Behaviour patterns, likes and dislikes are highly influenced by the people who lives
around us. Consumer always seek confirmation of family, friends, reference groups etc. for the
purchase of a product (Wolfe, 2014). Even, they get influenced by the reviews of these people
and according to their reviews or confirmation they buy the product. Thus, visiting the Hotel
Ritz-Carlton is also affected by the social factor.
Personal Factor
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Illustration 1: Factors Affecting Buyers Behaviour

This factor also affect the rendering of services at hotel because this factor mainly include
age, occupation and life style of a person. If person is of young and middle age then he/she will
highly demand for this service, old age people will rarely need this type of service. If a way of
living of a person is of high standard than they may visit this hotel by getting attracted towards
the innovative high-tech service (Cant and Heerden, 2005).
Psychological Factor
Many internal factors affect the behaviour of a consumer while staying at Hotel Ritz-
Carlton. It includes the motivation given by the hotel for attracting customer, perception of buyer
towards the brand of the product and product itself, expectations from the organization and from
product as well and most importantly the past experience about the Ritz-Carlton brand services
and products will affect the buying behaviour.
2.2 Assessment of advertising media used for sales development
There are various types of advertising media which is used for promoting the goods and
services of a company. Advertising can be done by using TV, newspaper, magazines, social
networking sites, outhouse advertising such as hoardings, etc. Advertising media used for
promoting home automation services at Hotel Ritz-Carlton are Magazines, Hoardings and social
networking sites. Assessment of these media are as follows:
 Magazines: Home automation service of the hotel is advertised in magazines because the
company has targeted high income group people and they often reads reputed magazines.
Thus, this media is used for promoting the new service. Actually, magazines are
purchased by status conscious people who belongs to high income group and it creates a
strong impact on them because magazines contains ads of reputed brands only (Johnson
and Vanetti, 2005). It usually last for long. Attention is paid on ads are more because of
the involvement of reader. However, ads given in magazines are more costlier and there
is advertisement clutter in it. Ritz-Carlton has to book the ads one month in advance and
for this purpose company has to make its marketing strategy in advance.
 Hoardings: Company also use billboards for advertising the innovative service because
it is very huge and eye-catching and it helps in directing a large and diverse market.
Moreover, it helps in rising the quick sales. But it cost high and feedback of customer
cannot be identified. This media does not target a specific group (Kunz, 2009).
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 Social Networking Sites: These days young candidates are use social media and seek
these sites as a status symbol. For this purpose, company can advertise its new services
on these sites and also sales promotion techniques such as providing coupons and
vouchers can be offered to the people which may help in developing the sales of the
hotel. Further, this site is less costlier and promotion can be done in a quicker manner.
These media can help the company to develop the sale of hotel rooms because they have
several advantages through which company can reach its target market globally.
2.3 Use of external merchandising to maximize customer volumes
In a general definition, merchandising is a type of activity of promoting the sale of
hospitality services. This activity includes display technique, on the spot demonstration, shelf
talkers, special offers, etc. This activity helps the company to maximize the customer volume so
that sales can be increased. While in the case of hospitality industry, merchandising can be done
by providing special offers so that customer who visit the hotel get attracted towards new service
also and get persuade to render such service (Lamb, Hair and McDaniel, 2011). The firm can
provide free vouchers of spa therapy on the purchase of room of home automation. It can also
take the customers on the visit of such special rooms so that customers get attracted and book
that room. Through, this external merchandising the volume of customer will get increase.
TASK C
3.1 Room design and layout influence customers
Room design and layout basically means the outlook of a hotel and rooms. Elements
includes in layout and design are ambiance, display of a service, equipment used, lightning that
is dim or bright, sound used to feel relax, etc. These thing help the company to attract the
customer at point of sale. Assessment of design and layout of Ritz-Carlton which will help in
knowing that it can influence the customer or not. If outlook of a room is set in an attractive
manner than this will increase the sales because customer will definitely visit such hotels which
are attractive (McDonald, 2012). Due to this sales of automated rooms will get increase
eventually. But it becomes necessary to change the layout on a regular interval. This will
increase the monthly expenses and which will affect the profitability of a company. But increase
in sale is more than the expenses so this activity is considered to be beneficial and it impacts the
consumer for availing the services (Taylor, 2012).
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3.2 Evaluation of the effectiveness of internal merchandising
Internal merchandising includes instructions to indicate customers about the new services
in the rooms, sales materials such as brochures, etc. This helps the customer to access the new
technology in an easier manner. This tool is used for promoting the goods and services in an
easier and convenient manner (Verret, 2008). This is the most effective tool because this will
help the customer who visit the hotel, in identifying the new services and the hotel staff who will
demonstrate the product working on the spot so that it affect the sales of a product. Sales
materials such as brochures, manual books etc. will also help in maximizing the sales.
3.3 Evaluation of different promotional activities
There are various types of promotional activities which is used for promoting the goods
and services of a company (Porter, 2015). These are TV advertising, print advertising, hoardings,
personal selling, publicity, direct marketing, sales promotion, online marketing etc. Ritz-Carlton
can use one or more or combination of these techniques in order to maximize their sales in
different situations. Different situations may be festive seasons, recession period, etc. at that time
different promotional activity is implemented by hotel to promote new service of home
automation and increase the sales. The evaluation can be done as follows: Advertising: This includes print ads, hoardings, etc. This is the effective tool for
promoting the new service because through this mass coverage can be done but it is the
costly technique of promoting. Sales Promotion: This technique include discount, free gifts, coupons, extra sales
services, etc. The most effective method for influencing customers and for maximizing
the sales and profit (Kester, 2015). Internet Marketing: Through this large market can be reached in a lesser time and in
lesser cost. In this, website advertisement, social media marketing is included.
 Personal Selling: In this, email newsletter, direct mailing is included. This is time
consuming method but proves to be very effective because it targets every individual
personally which creates a very strong impact on consumer's mind.
At the time of festive season such as Christmas and new year the promotion can be done
by combining the promotional activities such as sales promotion and heavy promotion through
print media with various offers. Ritz-Carlton can promote it hotels rooms at the time of
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Christmas through sales promotion by giving discount and free services and giving free gifts
while availing the services of home automated rooms in magazines and on hoardings.
At the time of recession or depressed period the purchasing power of consumer will go
down. At such period the sales development can be done by using the promotional technique of
personal selling in which company can do direct mailing, by sending email newsletter. It can also
do the sales promotion techniques such as giving discount and availability of rooms on the lesser
price, etc. This may increase the footfalls in Ritz-Carlton Hotel. This will be cost effective at that
period (Cant and Heerden, 2005).
When the demand of the automated rooms will get increase then company can adopt the
technique of up-selling in which they can increase the prices of the rooms or can provide the
services along with additional product. This is an effective technique which can increase the
profitability of a company.
Through these promotional techniques, company can increase the sales of Ritz-Carlton
rooms in different scenarios.
TASK D
4.1 Evaluation of personal selling techniques
Personal selling technique is a way through which Ritz-Carlton can increase its customer
base by building good personal relationships with other parties (Dutta, 2011). The point to be
remembered here is that the main focus of using personal selling techniques is not always to sell
the product, but, also to promote the product or simply deliver information about the product.
This includes selling through different modes such as: Non verbal mode: These skills helps in understanding what customers want. It can be
done with the help of new emerging technologies that take place through internet. It also
includes text messaging, online advertisements, sending personal e-mails, etc.
 Up-selling opportunities: It is a smarter way of selling and promoting those innovative
products that customer did not think of buying. It happens when a customer comes to buy
some product and the seller introduces him with some upgraded or simply new product.
This acts as an add-on and is an attempt by the seller to make more profits. The customer
is exposed to other options that he was not aware of.
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Thus these personal selling techniques and staff will play an important role in
maximizing sale of Ritz-Carlton by increasing the knowledge of the product among consumers.
It will also ensure in setting up a link between sales and services as hotel will come to know
about the needs and wants of people (Kunz, 2009). A satisfied customer will be always willing to
deal with the same brand again which will ensure and encourage repeat business.
4.2 A discussion about the influence of operational design on sales revenue
In order to increase the ratio of sales, it is essential for the hotel to maintain all the
operations in effectual manner. The design of the product (home automation) should be attractive
so that it can influence the visiting decision of customers. All the operations of home automation
should be technology concerned so that it can aid in producing the best results (Wolfe, 2014).
Home automation is such a service which customer can operate technically if they have idea
regarding its benefits. Operational design influences mindset of customers; therefore Ritz-
Carlton has to make sure that the service has different features. Both the aspects influence
customer's purchase decision and ultimately it leads to increased sales. Different tools and
equipment should be taken into account so that the product can become optimally useful for the
clients. At the same time, it has been observed operational efficacy of any business affects its
sales and revenue aspects.
All the operations of the business should be technically concerned so that it can manage
customer convenience. The design of automated rooms should be unique and attractive and it
must meet the needs of customers. Different features can be another option for maximizing the
value of sales and through this, product's effectiveness can also be encouraging. Technological
products have the power to generate more revenue; thus it is essential for Ritz-Carlton to
integrate the product with maximum use of technology (Kester, 2015). Furthermore, it is also
essential for the company to maintain all the operations in adequate way and along with that,
concern should be given to supply chain management. The value of automated rooms can be
increased if the product that is automated room is developed as per the use of customers.
4.3 Key principles that should be included in a sales training programme
While imparting training to the sales agent, it is essential for the training manager to
consider several key principles so that overall success can be achieved. At the same time, it is
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