DECLARATION OF WORK 1. This is compiled by me. 2.

This work has not been accepted in any previous application for a degree or diploma, by me or anyone else.

4. All the work in this assignment is completely done by me. All verbatim extracts have been distinguished by quotation marks and the sources of my information have specifically been acknowledged.3. Date: ________________ Jana van der Merwe: _______________ Contents Executive summary……………………………………………………………………… 4 Introduction ……………………………………………………………………………… 5 .

The SWOT analysis .10 Benchmarking……………………………………………………………………………12 Market Segmentation ……………………………………………………………………16 Description of the new service ………………………………………………………… EXECUTIVE SUMMARY .SWOT analysis of the Michelangelo……………………………………………6 SWOT analysis of the new service ………………………………………….

This will be an amazing cultural and dining experience for any client. It is important to consider the financial division when adding this service to the hotel. The new service of the Michelangelo Hotel is having an African themed rooftop restaurant and cocktail lounge overlooking the entire metropolitan area of Sandton City. the hotel will be unable to properly promote and create awareness about this new service. extraordinary facilities and service excellence.Within the hospitality industry. The Michelangelo Hotel is a 5 star luxury hotel set in one of the fastest moving cities in the world. By knowing these costs it is possible for the hotel to be able to see that by adding this service how both the hotel as well as the guests will be able to benefit from this additional service. the marketing department must plan and budget very carefully. as one must know what equipment and other contributing elements is needed. INTRODUCTION As a member of the Leading Hotels of the world. which could result in the hotel leading to a major downfall of profits and potential clients. the . which will also cover the promotional mix. and the segmentations of the target group. communication plan. By adding this new service to the hotel. To ensure that potential guests are completely aware of this new service. various factors need to be considered when a hotel wants to add a new product or service. it is possible to make the “African dream” a modern reality. elegance. The marketing section is divided into three main parts: the marketing mix. Without proper research and the above mentioned factors. The restaurant will be surrounded by ethnic African dancers with upbeat music and will have a specialty African or regular al la carte menu. A great deal of thought has gone into the marketing side of adding a new service to this hotel and it is of great importance that the finances are finely and accurately calculated and that the project is thoroughly planned. With its signature Renaissance architecture.

SWOT ANALYSIS OF THE MICHELANGELO A SWOT analysis is a technique used to assist the Marketing department in order to asses a product (Stimpson & Borrington. By adding a Rooftop African themed restaurant and cocktail lounge to this Hotel.Michelangelo makes a lasting impression from the moment one arrives. The Michelangelo Hotel is situated in the Nelson Mandela square in the bustling metropolis of Johannesburg and is a perfect complement to Sandton’s exclusive business district. this Hotel offers a spectacular view as it is tallest building of this area. Towering over this lively city. one can experience the true “African dream” brought to the modern metropolitan of Johannesburg. 2010). For the implementation of strategic planning .

Experienced.Very Competitive hotel . 2008). one plays strengths against market opportunities caused by shortcomings in the products of competitors and / or services.for any company. The components of a SWOT analysis helps to minimize the potential impact of the weaknesses in your business while maximizing your strengths. Morrison.Strong ethical values and mission statement .Part of Leading Hotels of the world . A SWOT analysis can also be used to review the business as a whole (M. weaknesses. it is useful to make an analysis that takes into account not only their business. but complete your competitors 'activities' and events in progress in the industry.Popular destination for both leisure and business travelers Not enough variety of dining places within the hotel Weaknesses Expensive room rates Poor maintenance and upkeep Food quality not up to standard POSITIVE NEGATIVE Opportunities Growing Market Location (view) Has the opportunity to expand its restaurant Threats Staff turnover to competitors Economic slowdown Overprovision of hotels in the area (competitors) Decline in foreign guests due to the ending of the FIFA World Cup EXTERNAL . The following SWOT analysis is a reflection of both the internal (strengths and weaknesses) and external (Opportunities and Threats) factors of the Michelangelo hotel. opportunities and threats of a product or service. one can asses the strengths. By using a SWOT analysis.Location . INTERNAL Strengths . 2008). The SWOT analysis is one such analysis (M.Good reputation . Ideally. resourceful and dedicated workforce . Morison.

This factor produces thus a massive strength for this hotel as none of the Michelangelo’s main competitors (the Westcliff Hotel. This simply means that the Michelangelo posses certain characteristics that other hotels do not have or posses in such abundance. The staff of the Michelangelo creates the standard for all the others in the area as it has been described by some as simply the best service in and around the area: “The best service that I. there is a lot more arousal around this hotel as it is the only hotel in the area that has accomplished this standard of excellence. as other hotels are not as orientated on both leisure and business and are often unwelcoming corporate hotels. As any other hotel in the Hospitality Industry. The Ten Bompas and the Palazzo Monte Casino) have received this prestigious reward.Table 1. or my colleges.1 As seen in the SWOT analysis (Table 1. the Michelangelo has much internal strength. which is perhaps the biggest strength of this hotel. offering breathtaking views of the city. This dedicated workforce is a major strength of this hotel as it has opened the door to so many more potential clients. It is said that that the weakness of a hotel is the most important of the SWOT analysis. Thus this hotel has the perfect location that enables easy access as well as amazing views to the entertainment and corporate capitol of Africa Due to the fact that the Michelangelo is a member of Leading Hotels of the World ( ). 2010). is due to the fact that no other hotel in the area is as comfortably situated or close to the shopping district of Sandton city as the Michelangelo. as this is an internal problem that the hotel can change or improve (Stimpson & Borrington. The location. The . This hotel is the most popular hotel for both leisure and business. The hotel therefore offers an unlimited haven for any traveler after shopping at Sandton City Centre.1). 2006). it cannot be flawless. therefore bringing in more and more clients and more profit. have ever encountered” (Tripadvisor. which is a good strong point for the Michelangelo. It is also the tallest building in the area. These factors all contribute to the popularity of this hotel.

but now the hotel must find an alternative way to bring up its occupancy again to be able to have the same profit turnover. This will draw in more consumers and ideally. then people will refuse to pay such excessive amounts in the future. Opportunities should be analyzed and see if any elements can contribute to controlling the external threats (Morrison. The high prices of this hotel cannot necessarily be attached to the service and facilities of the hotel. as it is close to the Guatrain. lose al lot of profit. Threats seen in the hotel are mainly the competition from competitor hotels. The hotel has the ability to utilize the open rooftop and create a new restaurant and cocktail lounge as it has a lot of space and available resources to be able to do this. Clientele will be expecting the best services and facilities. can influence the hotel in such an enormous way. When people pay such a high fee for a hotel. their expectations are very high and should maintenance and upkeep issues not be addressed or met up to standards. The hotel is a very high class hotel with a good reputation and lots of recognition. These weaknesses. By looking at the Position matrix (Figure xxx).expensive rack room rates of this hotel. The hotel can very easily lose clients if they should receive poor service or experience facilities at such a low levels that they may never return and in turn. facilities and guests experiences. however small or big. The Michelangelo also has a USP due to the vertical magnitude of the hotel It has the opportunity of taking full advantage of the roof top and all the amazing views there are to offer. M. The Michelangelo has a big challenge in order to stay at the top. offer a big threat to the hotel as they can offer cheaper prices for more or less the same service. The other major threat to the hotel is the fact that there is a big decrease in the total amount of foreign visitors after the ending of the world cup. . bring in more profit. This was a very convenient location for all soccer fanatics. poor upkeep and maintenance issues present weaknesses of this hotel. 2008). Sandton is an upper class area that is always changing with technology. it is clear that all these competitors are in the same class as the Michelangelo. External opportunities such as the opportunity to take full advantage of the growing market are present.

SWOT ANALYSIS FOR NEW SERVICE: A ROOFTOP RESTAURANT AND COCKTAIL LOUNGE The following SWOT analysis is a possible reflection of the internal and external factors that will influence the opening of a new rooftop restaurant as well as how it will be beneficial for both the hotel and the guest. .

as people have a hunger for cultural experiences (****reference****). It should be kept in mind that building this restaurant will take some time and that the construction noise may bother some guests. but also for the additional staff that needs to be hired. will greatly improve the dining experience of any guests and will also improve the image of the Michelangelo. not only for contractors. This will also increase the image of the hotel for not only foreign visitors. These above mentioned factors (as seen in Table 1.INTERNAL Strengths: Good brand image for the hotel Unique selling point (USP) Good cultural environment Weaknesses: Construction time will take time Limited seating available Increase in labour costs of additional staff Table 1. Not only will it create awareness of all the different cultures in this country. especially foreign guests. POSITIVE NEGATIVE Opportunities: Increase image for the hotel Encourage more guests to stay at the hotel . but will also display how proud South Africans can be of this amazing cultural diversity. There would also be a potential increase in labour costs. but also for local individuals as it will clearly showcase that South Africa is proud of its heritage.2).Increase in profit turnover EXTERNAL Threats: - Unpredictable weather Noise (from the traffic below) . making this the ultimate USP (Unique Selling Point) which makes this a good strength for the hotel. This would be the only rooftop restaurant and cocktail lounge in the area.2 This new rooftop restaurant and cocktail lounge will provide a new cultural dimension and raise cultural experiences of this vibrant country to a new level.

according to trip advisor and the virtual tourist are: The West Cliff Hotel is a big competitor to the Michelangelo Hotel. Guests will be encouraged to stay at the Michelangelo in order to make easier use of this exciting dining experience. There are however. Drawbacks such as unpredictable weather and noises may arise from the ongoing traffic. the Michelangelo is able to make a lot more profit and potential future clients. wind or hail. . as it is recommended by 86% of travelers as one of the best hotels in Johannesburg (Tripadvisor.Overall. The top three competitors. These drawbacks can be eliminated by adding a glass rooftop to this restaurant. home to a large cosmopolitan population and business centre of Johannesburg. 2010). BENCHMARKING There are a lot of competitors in the Sandton area as this is a bustling and vibrant place. some drawbacks that need to be considered when adding this service. the rooftop restaurant and cocktail lounge has the potential to improve the recognition of the Michelangelo above other hotels and will elevate the hotel to a much higher standard. By adding this rooftop restaurant. By doing so it is possible to keep the view and at the same time eliminate all the forces of nature such as rain.

“Great location which was close to the zoo. 2010). 2010). Duck feeding. but exceeded” (Tripadvisor. children’s facilities (The Johannesburg Zoo. The Michelangelo does not offer a dining experience as extensive as the Westcliff hotel or any kind of children’s facility. The rates vary from R2890 to R4350 (rack rate) per room per night. especially mothers. Colour Café . There are several services and facilities that this hotel offers. Exotic birds. . The West Cliff Hotel also has a wonderful conference facility for any type of conferences or business meetings and offers an amazing venue for weddings. as it has multiple facilities that the Michelangelo does not have. Families or working mothers staying at the hotel and will therefore rather choose a hotel that caters for children’s facilities and the needs of them (more childfriendly). Situated on a very convenient location. shuttle service for within a 15 km radius of the hotel. Theatre Classes. grounds perfect for a jog or cycling and some of the area’s best golf courses. These facilities and services are: Concierge guide. “After being so impressed with another hotel in this area. Sandton and other attractions” (Tripadvisor.a fully equipped gym. guests can become bored with having the same meals everyday and will make their stay at the Michelangelo bland and uninteresting.The five star West Cliff Hotel is set on a beautiful Cliffside garden Estate. Not only does this hotel offer excellent facilities. out looking Zoological gardens in the centre of the city. depending on the room and the time you go to the hotel. This hotel offers a major threat and is the primary competitor of the Michelangelo. This will result in a loss of potential clients as families. Botanica Spa Suites -for both men and women. but it also offers outstanding service. access to tennis courts positioned high above the city. Star gazing and Lustrous Lipizzaner) a selection of restaurants (La Belle Terrasse and Loggia. we decide to try another hotel and my expectations of the Westcliff hotel was not only met. Guests like to have different experiences when dining and as the Michelangelo only has one main dining area (The Piccolo Mondo). Art fun. The Conservatory & Pool Bar and The Polo Bar).

complimentary mini bar. fashion shows and press conferences. The price range for this hotel is from R3500 R4000 per suite per night (Including breakfast. The price for a full day’s conference (08:00-17:00) is R450 per delegate and for a half day (08:00-12:30) is R375.ideal for any deluxe travel. Ten Bompas has developed expertise in successfully staging various types of functions and events – from weddings to motor car launches. hot beverages and in-house laundry services). This hotel is recommended by 82% of travelers on . 2010). situated in Bompas Road. Dunkeld West. As this hotel is a boutique hotel. is a five star luxurious contemporary boutique hotel. The elegant bar area is an ideal place to entertain business guests or to relax before dinner. it is much smaller and offers more personal service and attention than at the Michelangelo “The real highlight was the friendly and appreciative staff always on hand and so polite to us!” (Tripadvisor. The Ten Bompas also offers a range of functions and conference facilities. becomes a better hotel to the average customer of both these hotels.cannot experience the Michelangelo as much as they could have if the hotel had provision for children. as it offers the same (and more) services and facilities. a private wine cellar of an amazing selection of wines. The USP of this hotel. The hotel has an award winning restaurant with its own wine cellar. Outdoor terraces. This hotel is a big competitor to the Michelangelo Hotel. garden and lap pool allow guests to make the most of the beautiful South African climate. The Ten Bompas is a perfect haven for sanity and tranquility. whilst in the heart of the business area. is not the only factor that makes this hotel a threat to the Michelangelo. The strengths of this hotel are also the Michelangelo’s weakness. This hotel is not as expensive as the Michelangelo (The Ten Bompas rack rate for a suite is a third of that of the Michelangelo’s) and considering that the economy is not at its best. These factors will result that guests that fit this demographic segmentation would much rather stay at the Westcliff hotel than at the Michelangelo.

resulting in the best view. The Palazzo Monte Casino offers fully equipped conference rooms that caters for all business and travelers needs and is described as a “Beautiful hotel with excellent staff” (Tripadvisor. a mere 15 minutes from Sandton. By adding this new and exiting rooftop cocktail lounge. The hotel characterize true style and luxury. South Africa's business hub.R Tambo International Airport and 20 minutes from Lanseria International Airport. This hotel offers all the facilities and services that the Michelangelo offers. The Palazzo Monte Casino is cut-throat competitor to the Michelangelo. offering some of the best entertainment in the area. None of its competitors will be able to compete with this. with world-class facilities for the business and leisure traveler.bed roomed Penthouse to comfortable standard rooms that cater for all tastes and travel requirements. It also includes a variety of tastefully decorated rooms that vary from the luxurious 3. only 4% less than the Westcliff hotel. as the Michelangelo is the tallest building. The hotel forms part of the award winning Monte casino Entertainment Complex. which results in a big increase of competitiveness between these hotels. the Michelangelo offers a very unique must experience dining facility.Tripadvisor. Guests can enjoy leisure time around the magnificent outdoor swimming area which offers a light menu as well as a Thai massage therapy service. The lavishly stylish Palazzo Monte casino is perfectly located in the up market suburb of Fourways Johannesburg. as this hotel offers unlimited and unparallel entertainment options for the guests. making this the top travelers destination. The hotel offers a true culinary experience at the Medeo Restaurant which serves Italian flavoured dishes with a delicate French and African flair. . 40 minutes from O. Therefore these two hotels offer a great threat to the Michelangelo as their reputations precedes them. The Michelangelo will therefore improve on its weakness and build on its opportunities to be the best hotel in this area. 2010).

but is consistent within these groups. 1997). Segmentation is the division of a total market into its component parts that consists of people or organizations that share similar characteristics.This addition will increase customer popularity of the Michelangelo. That is why it is of great importance to segment your market. it is essential to know what the potential market is for the product or service. as well as the best ways to reach potential consumers (Terrell. MARKET SEGMENTATION To be able to sell your product effectively. 2005). Consumer Market Segmentations is a basis for factors that varies amongst groups within a market. which will result in more recurring customer patronage and ultimately placing it where it should be. There are four primary bases where “Market segmentation can be identified by . resulting into a demand for the same service or product (Cahill. at the top.

. psychographic and behavioral differences amongst buyers” (Kotler. 1998).examining demographic. 2006). while geographic and demographic criteria are used to determine product design and regional focus (Cohen. Psychographic and behaviorist bases are used to determine preferences and demand for a product and advertising content.

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