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The Fine Dining Case

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Patricia Sugianto

on 3 May 2013

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Transcript of The Fine Dining Case

The Royal Dining Membership Program E50 Group 2 Study Case Presentation Airy Putra Leokwary
Clara Tjayadi
Lenny Yong
Patricia Sugianto The Summary
The Indonesian's Perspective
The Answers of Study Questions The Summary Introduction The Hong Kong Grand was opened in the late 1800s. A Luxurious Hotel 4 restaurants THE SECOND LARGEST
meeting space in Hong Kong Change in ownership Declining amount of customers Launched The Royal Dining Membership Program (RD Membership Program) The Royal Dining Membership Program The First Year: over 1,000 memberships sold 2012: 4,200 members RD annual membership fee is
HK $1,588 (= US $210) Price Reduction
Schedule: •Member plus 1 guest (2 adults)50%*
•Member plus 2 guests (3 adults)33%
•Member plus 3 guests (4 adults)25%
•Member plus 4 guests or more (up to a total of 10 adults)20%
•Member dining alone10% Conditions •Discount is calculated on the total food bill only, excluding beverages, government taxes, and service charges (does not apply to private dining and take-away).
•One card per table, per party, per occasion. Not valid with any other discounts or promotions.
•A 10% reduction will also be applied to bar snacks, where applicable.
•Children dining with members also received the discount. Children under five ate for free in the buffet restaurant. Special children’s menus were available in the a la carte restaurants. Other Benefits: • A flat 20% discount will be given to members during Chinese New Year blackout dates, minimum five or more people at one table at all restaurants except Kabuki.

• 1 Special Occasion voucher for 50% discount on total food bill in any one of the hotel’s restaurants, when dining in a party of 6–12 people. Not available during Chinese New Year period—the eve to the 15th day of Chinese New Year.

• Discounted room rates at the Hong Kong Grand (subject to availability).

• Birthday and wedding vouchers, and discounts at several stores in the hotel. Type of Membership Royal Dining Traditional HK $1,588 per year Royal Dining Epicure HK $2,588 per year The Program Dilemma Program Manager for the RD Program (Erica) view: - The Royal Dining Program produced a lot of revenues - The Hong Kong Grand Hotel had to create value for the customers as the benefits of the program - Adding more rules would make the members annoyed Vice President of Hotel Operations (Jerome) view: Vice President of Marketing (Carmen) view: Vice President of Finance (Susan) view: The Indonesian's Perspective The Answers of Study Questions In Erica Liu’s shoes, what would you present to the executive comittee? 1 Erica’s Argument - Increasing Revenue

- Increasing Profit

- Positive Cash Flow Benefits of Program Costs of Program - Negative effect to the Hong Kong Grand Hotel’s Luxury Brand
- Membership rules were abused

- Decreasing Regular Customer

- Unsatisfied Employee 2 3 4 5 As Erica Liu, what analysis would you run to assess the financial performance of the RD membership program? What effect does the RD membership program have on the brand and value perception of its local customers in Hong Kong and its full-paying hotel guests and diners? How could the hotel address these issues? Review the rules set for the RD program. How would you go about setting rules for the program that protect the hotel against abuse, but does not make RD members feel that the program is unnecessarily restrictive and difficult to use? How could negative server attitudes toward RD customers be handled? - Total Sales of the Month
- Margin of the Month (TR-TC)
- Sales per seat (Sales/ Total Seat)
- Sales per visit (Sales/ Total number lunch and dinner per day)
- Market Share - The negative effect toward the brand and value perception
- Less customers (full paying hotel guests and diners)
- This decline also caused by its RD members themselves To address this issue, The Hong Kong Grand should change their policies: SIMPLE RULES SHORT TERM LUXURY IMAGE - The rules on the RD membership program are quite confusing --> many people misunderstood;made lots of complaints and critics The adjoining shopping mall. + PROBLEM? EXCELLENT IDEA! 50% discount is applicable only when: – RD member were displacing their regular customers – Although this program was profitable, but the member was considered as unethical by some of the server. – Member had become more creative in getting around the rules – The Hong Kong Grand Hotel tried to position itself to be a luxurious restaurant – It was a little bit odd when there was an offer regarding discount program – How to maintain this program and the brand – The owners were focused on customer – They would be sad if this program was dumped – Suggestion to extend the discount to beverage – The program would be more attractive and
financial performance would be stronger THE SIMILAR CASE THE INDONESIAN CUSTOMERS'
POINT OF VIEW •No exact example represents the same type of fine-dining case in Indonesia •The similar case in Indonesia is Casa D’ Oro, Hotel Indonesia Kempinski FACTS THE HISTORY - Hotel Indonesia Kempinski was built on August 5th 1962 - A luxurious hotel of 50 years that was reborn under the world-class Kempinski brand, a European hotelier since 1897 - It becomes the first starred hotel in Jakarta and was used for many important events The Restaurants •Signatures Restaurants•Lobby Nirwana Lounge•Casa D’Oro Italian Dining•Paulaner Brauhaus•Sky Pool Bar Café•Kempi Deli The Casa D’ Oro Restaurant Profile OPEN EVERYDAY - Monday to Sunday - Lunch time (12:00PM – 02.30PM) - Dinner time (06:00PM-10:30PM) The Promotion Programs •No dining membership program, but there is partnership in form of various cards: 1.Grand Indonesia card: to encourage and rewards the shoppers 2.Global Hotel Alliance Card: combined membership cards with ten hotels that gives 10% discount for diner 3.Other promotion: -Free one glass of wine for in-house hotel guest.
-Get discount for early booking guest.
-Discount 20% for lunch and dinner by using BCA card (platinum, BCA SQ, VISA, and Infinite), starting from April 1st – June 2013.
-Business Lunch set menu with complete starter, various main course, and desert.
-Live Entertainment in weekend only.
-Seasonal promotion: pasta of the day, white asparagus day. •The Royal Dining Program had over 4.200 members •Kabuki was the most visited restaurant by the member •The program increased the restaurant’s profit sharply •Marketing, Operational, and Finance Manager complaints - Some terms and conditions should be clearly stated - The rules should not be too complicated and long Create the rule about the discounts as simple as possible REFERENCES 1 Hotel Mulia. (2010). Home. Retrieved: 23-03-2013, from source: http://www.thetable8.com/
2Cassis. (2013). Services. Retrieved: 23-03-2013, from source: http://www.cassis-gourmand.com/content/our-partners.html
3 Kempinski Hotels. (2013). Signatures Restaurant. Retrieved: 23-03-2013, from source:http://www.kempinski.com/en/jakarta/hotel-indonesia/dining/restaurants/signatures-restaurant/
4 Kempinski Hotels. (2013). Lobby Nirwana Lounge. Retrieved: 23-03-2013, from source: http://www.kempinski.com/en/jakarta/hotel-indonesia/dining/restaurants/lobby-nirwana-lounge/
5Kempinski Hotels. (2013). Casa D’Oro. Retrieved: 23-03-2013, from source: http://www.kempinski.com/en/jakarta/hotel-indonesia/dining/restaurants/casa-d-oro/
6 Kempinski Hotels. (2013). Paulaner Braeuhaus. Retrieved: 23-03-2013, from source: http://www.kempinski.com/en/jakarta/hotel-indonesia/dining/restaurants/paulaner-braeuhaus/
7 Kempinski Hotels. (2013). Sky Pool Bar Café. Retrieved: 23-03-2013, from source: http://www.kempinski.com/en/jakarta/hotel-indonesia/dining/restaurants/sky-pool-bar-cafe/
8Kempinski Hotels. (2013). Kempi Deli. Retrieved: 23-03-2013, from source: http://www.kempinski.com/en/jakarta/hotel-indonesia/dining/restaurants/kempi-deli/
9 Kempinski Hotels. (2013). Lifestyle Privilege Member. Retrieved: 23-03-2013, from source: http://www.kempinski.com/en/jakarta/hotel-indonesia/dining/lifestyle-privilege-member/
10 Santika Hotel. (2012).Santika Important Person Card. Retrieved: 23-03-2013, from source: http://www.santika.com/santika.php?gmid=8
Full transcript