Group Discussion 3

Analysing strategic factors of the products and services through resolving a business case from the
practice:

Three domestic investors associated and bought the Laguna hotel in one of larger coastal cities in Phu
Yen. The hotel is situated at an attractive position, in the vicinity of all important traffic routes and is
encircled with natural beauties of the nearby national parks and parks of nature. The hotel has 200
middle-sized rooms of approximately 20m2, a pool, a built beach access walkway and two big dining
rooms, one for lunch/dinner and the other for banquets, which has been out of use for several years.
There are no other restaurants in the hotel except for a small cafe bar in the lobby. The new owners
think that the rooms are too small. They are considering expanding and luxuriously re-decorating a part
of rooms, but such endeavour will be expensive and will make it impossible to use 100 - 150 rooms in
the next tourist season. Three other hotels of a similar size, built in 1970s (similar like the Laguna hotel),
are the main competition for the hotel. Two out of those three hotels offer the same kind of products
and services as the Laguna hotel and fill up their accommodation capacities with organised groups of
foreign tourists with modest ability of payment. The third hotel is in a rather poor condition and offers
a lower level of accommodation and services in relation to other hotels, at lower prices. This year all
large hotels are fighting to attract customers, but in the period from September to December they
managed to attain only 60% occupancy of accommodation capacities. In the period until the end of this
year they are expecting a small number of guests, so that all hotels will be closed for at least four months.
There are several small family hotels in the city as well, each of which has on average 15 rooms, and a
beautiful new hotel with 160 rooms, a 5* category, in private ownership, situated in the historic city
core, run by the Hilton corporation. The new hotel management has requested advice about the strategy
that will enable them to increase the occupancy of accommodation capacities of the hotel in the next
two years.
In their initial conclusions the students should decide to apply the strategic marketing framework and
answer the questions posed.
1) Determine the basic segments of hotel market in the city in which the Laguna hotel operates. In the
left-hand column add the types of the hotels doing business in the city, and in the right-hand column
add a short description of segments of sale of such a hotel.
Types of the hotels Segments of sale
a)
b)
c)
d)
2) On the basis of segments of sale specified under 1 (or other categories of customers who are not specified,
and for which you think they should be specified), advise the management of the Laguna hotel as to the
targeted customers that the strategic marketing of the hotel should focus on and provide an explanation?
3) Explain what the Laguna should do to position itself as successfully as possible in relation to other hotels
and attract targeted customers?
a) Specify the hotel’s unique selling points?
b) Which mix of services do you recommend to maximise the new position of the hotel and which changes
should be made during the reconstruction of the hotel to make this happen?