Strategic Analysis and Recommendations for Booking.com (MGT3170)

This report provides a comprehensive strategic analysis of Booking.com, examining its external environment through PESTLE and Porter's Five Forces, as well as its internal environment using VRIO and value chain analysis. The report assesses Booking.com's strengths, weaknesses, opportunities, and threats, and includes a competitor analysis. It explores the company's business model, financial performance, and industry lifecycle stage. The report concludes with strategic recommendations, including marketing, product development, and competitive strategies, addressing strategic issues such as mergers and competitive dynamics, and proposing strategic options for future growth. This analysis aims to provide insights into Booking.com's current position and suggest potential strategies for sustained success in the competitive online travel industry.

BOOKING.COM

The company was established in 1996 in
Amsterdam. It is one of the largest travel
e-commerce company in the world.. The
mission of the company is to invest in
digital technology in order to make the
traveling easy. The company has different
websites and mobile application in the 40
languages. It connect the different
travellers with the world largest selection
of incredible places to stay. It have 17
years of experience with the 8000 of
employees in the 135 offices in the
worldwide (Booking..com, 2018)
ABOUT-
BOOKING.COM

Political
Different Government develop
the different rules and
regulation as per the economy
situation of the country.
The different policies has
developed by the government
in order to maintain the peace
such as agreement of legally
rent for the short period of
time.
Economical
It has been seen that 16.7
million users use the internet.
Consumers have high
purchasing power (Globig.,
2018)
PESTLE ANALYSIS-
BOOKING.COM

PESTLE ANALYSIS-
BOOKING.COM
Economical
 It earned 16.1billion euros in the year of 2015
 $48860 is GDP of the Netherland which makes
the country richest country in the world.
Social
 Trends and taste affect the demand of the
consumers.
 Online travel and tickets are the most popular
categories with the percentage of 38.96%.
 At the time of vacations, the demand is
increases.

PESTLE ANALYSIS-
BOOKING.COM
Technological
 Use internet to book the tickets
 Connect the travellers from the different corners of the
world through advance network system
 Use social media to promote the services
Legal
 It is registered under the board of Amsterdam,
Netherland.
 Civil code act was developed by the government in which
the company has to attach the chamber of commerce
number with the information.
Environmental
 The company faces less environmental issue


The threat of new entrants-
The company have low threat of new entrant just because of high capital required in
system infrastructure. There are limited company who access the GDS. GDS is
challenged by the GNEs.
Bargaining Power of Buyer
High bargaining power of buyer due to high competition in the market. Individual
consumers have the power to switch to new OTAs (Li, Huang, Song, Wang, and Wang,
2016).
Bargaining Power of Supplier
High Bargaining power of suppliers just because of high competition in the market.
Suppliers provide the unsold room for the guest. Small hotels have limited
infrastructure for the online booking.
The threat of competitors
The high threat of competitors due to large number of companies in the OTA market.
But there is limited companies who book the deals directly.
The threat of substitute
The company also has high threat of substitute because people can book their tickets
from travel agents, travel suppliers (Bell, and Rochford, 2016).
PORTER’S FIVE FORCES
FRAMEWORK

It has been seen that the
company is well popular and
stable in the terms of profit
and revenue. As per the
analysis, it can be said that
the company is at the maturity
level where the company is
stable in terms of profit, cash
and revenue.
On the evaluation of business,
it has been seen that the
company is operating under
the online industry. The online
booking industry can be
divided into the several
strategic group such as online
booking, Price and global
presence.
Strategic Group Model of
Booking.com
I N D U S T RY L I F E C YC L E S T R AT E G I C G R O U P M O D E L
MODELS
Boo
king
.com

It has been seen that with the developing technology, the
existing companies use different strategies and techniques to
expand the business at the international level. Tripadvisor,
Kayak and Airnib are the top competitors of the company.
Although, the company have less threat because there are
limited companies who can directly book their tickets (Owler,
2019) .
The company has high market share in the industry due to its
quality and experience. Airnib contains 65% during the Dubai
peak season which increase the high competition between the
competitors. Kayak also have the high market share in the
terms of prices of hotels. The company has to adopt the
strategy so that it can achieve success in the future.
COMPETITOR ANALYSIS-
BOOKING.COM

BUSINESS MODEL

The way in which the company is generating revenue
is called business model. Boooking.com follow the
appropriate structure of organisation in order to
achieve the success.
The company maintain the organisation structure in
the different segments such as key partners, key
activities, key resources, value proposition, customer
segments, customer relationship and many others in
order to achieve the success in the future.
The segments and organisation structure helps the
company to achieve the success in the future.
Relationship with the customer and maintaining of
asset are the main activity which helps to earn the
high revenue.
BUSINESS MODEL

• The company use
the new technology
as per the passage
of time. It is also a
reason of
increasing
• Expansion of the business
through mobile application.
Adding new features
Improve the quality with the
help of employees
• The main weakness
of the company is
Miscommunication
due to online
booking. It has
been seen that the
company also face
the issue of
negative review of
consumers
• Human resource is the
main asset of the
company. The company
also have large number of
year experience with the
high brand value. The
company have the quality
and reasonable price of
services of the company Strength Weakness
es
Threat
Opportuni
ty
RESOURCES CAPABILITIES-
BOOKING.COM

Value
The company uses the computers, laptops for
booking the tickets.
Reaction
The services provided by the company is available in the market with the
many of companies which reflect that the company can take the temporary
competitive advantage.
Imitability
The company uses the resources in different way in order to gain the
competitive advantage.
Organisation
The company follow the proper structure in which the organisation operate
their business (Management Mania, 2018).
VRIO