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Business Strategy

Enhanced Energy Solutions

June 21, 2018

Our Team

Our Team

Laura Langeraar

Communication

Aparnaa Tharmarajah

International Business & Management Studies

Marika Krauze

International Business & Management Studies

Melanie Deering

Business Administration

Accounting & Management Major

Hyelyn Joo

Business Administration

Business Major

Our Company

Intro

About

Marriot

About Marriott International, Inc.

  • based in Bethesda, Maryland, USA
  • more than 6,500 properties
  • 30 leading hotel brands
  • 127 countries and territories

Marriott operates are franchises hotels and licenses vacation ownership resorts all around the world.

The company also operates award-winning loyalty programs: Marriott Rewards®, which includes The Ritz-Carlton Rewards®, and Starwood Preferred Guest®

Our Core Values

At Marriott, we never stop searching for inventive ways to serve our customers, provide opportunities for our associates, and grow our business. The company that began as a nine-seat A&W root beer stand is recognized today as a top employer and for its superior business operations, which it conducts based on five core values:

  • Put people first
  • Pursue excellence
  • Embrace change
  • Act with integrity
  • Serve our world

Agenda

  • Scope
  • Challenge statement
  • Industry analysis
  • Competitors
  • Profitibility
  • Marriott & Hilton Strategies
  • International Strategy
  • Transnational Strategy
  • Conclusion

Challenge

SCOPE

The strategic battle between Marriott and Hilton worlwide

Challenge Statement

How can the Marriott beat the Hilton and be the number one hotel in the hotel industry?

Industry Overview

Industry

Analysis

Porters - Hotel Industry

PORTERS

Knowing these impacts

on the company helps to create awareness of possible obstacles and in the best case it gives the

company time and room to create ideas and further steps to overcome these hindrances. Knowing

possible difficulties when maintaining the CA is key to a successful

positioning.

Opportunity & Threats

Opportunities & Threats

  • Political tension

  • (Fast) changes in tech

  • Changes in customer segments
  • New technology

  • International travellers

  • Millennials

  • Strengthening economies

  • Health & sustainability

Strategies Group Mapping

Strategic Group Mapping

  • Strategic group mapping is a technique for looking at your position in your sector, field or market.

  • It is tool for competition analysis Strategic group map help to define the scope of firm`s competitors

Value Frontier

Competitive Advantage

Competitors

Competitor Value Frontier

BRAND VALUE

Direct Competitor

Marriot

Vs.

Hilton

Marriot vs Hilton

Profitability

Profitability

Profitability -

Company Value

Profit Analysis

Profitability Ratios

Operating Margin

  • Marriott 12%
  • Hilton 15%

After Tax ROE

  • Marriot 37%
  • Hilton 61%

Profit Margin

  • Marriott 6%
  • Hilton 14%

Market Share

Market Share

Marriott / Hilton

Global Chess

Internal Analysis

-------------------

Performance

Strategy

R &C

Resources & Capabilities

Resources:

  • Reputation with customers
  • Global Service Leadership Award
  • Usage of computing machine/engineering
  • Higher brand recognition
  • Management Knowledge

build

Strategies

Competitive Advantage

Superior customer responsiveness

Distinctive Competencies

  • Put people first
  • Purse excellence
  • Embrace change
  • Serve the world
  • Act with integrity

build

Capabilities:

  • Global presence
  • Strong brand portfolio
  • Commitment to service and guest satisfaction
  • Initiated plan to profit for humanity

Building Blocks

4 Building Blocks

International Strategy

Strategies of Marriot

Strategies of Hilton

Strategies-

Link

  • Aims to be sustainable and enviromental friendly
  • BLS: Focused differentiation strategy
  • Do not have moderate price hotels
  • GLS: Transnational strategy
  • Aims to expand within upscale tier as well as an affordable lifestyle category
  • BLS: Differentiation strategy
  • Lowers costs with the use of enviromental practices
  • GLS: Transnational strategy

External

&

Internal Link

Internal and External Links

Marriott

  • Focus on the next generation of travelers
  • Focus on operational excellence

Hilton

  • Training staff for changing international landscape
  • Sustainability

Global

Transnational Strategy

Market saturation - Global scanning and learning

  • Marriott buys different hotel chains; at the same time buy their knowledge about the market

Worlwide

Advantage

Goals & Means

  • Transnational companies focus on each and every goals-Mean combination to develop layers of competitive advantage by exploiting efficiency, flexibility, and learning simutaniously

Conclusion / Comparison

Conclusion

Now Hilton is LEADER

BUT, Marriott is following Hilton very closely.

Recommendation

Recommendation

  • Focus on the millenials and what they want and need
  • Keep the excellence in all hotels. Not just the high end, but also the low end
  • Don't forget about sustainability, which is important for millenials
  • Focus on expanding - travel and tourism (European Union)
  • Focus on offering extensive global network & loyalty perks
  • A core competency in global innovation - the ability to leverage new ideas all around the world - has become a major source of global competitive advantage

End Notes

References

https://www.nasdaq.com/symbol/mar/financials?query=ratios

https://csimarket.com/stocks/competitionSEG2.php?code=MAR

https://brittoncrafton.wordpress.com/2014/03/02/hilton-worldwide-and-market-differentiation/

https://youtu.be/6qnsIa1SA6Q

https://youtu.be/PgenGVOXfi0

https://cr.hilton.com/wp-content/uploads/2018/05/Hilton_Infograph_2030_Value-Chain-Targets.pdf

https://research-methodology.net/hilton-hotels-segmentation/

https://mpra.ub.uni-muenchen.de/58366/1/MPRA_paper_58366.pdf - link to Porters

https://digitalscholarship.unlv.edu/cgi/viewcontent.cgi?article=1631&context=thesesdissertations

https://books.google.nl/books?id=CzIK9ELsyYwC&pg=PA256&lpg=PA256&dq=hilton+pressure+for+local+responsiveness&source=bl&ots=AXh8Nx6KpW&sig=t4FTNJAglxhDH10hfCtBR8BcuoY&hl=en&sa=X&ved=0ahUKEwjaieHEgrvbAhWObFAKHa7IAssQ6AEIUzAF#v=onepage&q&f=false

https://www.statista.com/statistics/247264/total-revenue-of-the-global-hotel-industry/

http://www.businessdictionary.com/definition/hotel.html

https://www.ukessays.com/essays/management/model-of-value-chain-management-essay.php

http://hotel-development.marriott.com/

Essays, UK. (November 2013). Marriott International: An Analysis. Retrieved from https://www.ukessays.com/essays/tourism/internal-and-external-environment-tourism-essay.php?vref=1

https://2012books.lardbucket.org/books/global-strategy/s08-globalizing-the-value-proposit.html#dekluyverglobstrat_1.0-ch06_s02_f01

Link to profitibility section

Back up slides

CEO of Marriot & Hilton

Economies of Scale

Global propositioning

  • A pure aggregation approach (also sometimes referred to as a “global marketing mix” strategy) under which both the offer and the message are the same
  • An approach characterized by an identical offer (product/service aggregation) but different positioning (message adaptation) around the world (also called a “global offer” strategy)
  • An approach under which the offer might be different in various parts of the world (product adaptation) but where the message is the same (message aggregation; also referred to as a “global message” strategy)
  • A “global change” strategy under which both the offer and the message are adapted to local market circumstances

Hilton vs Marriott Comparison

According to Hilton and Marriott websites, Hilton is generating most of its revenue using the web reservation system while the main Marriott income (about 40%) is generated from Marriott's members.

This good example is showing how two very similar products are offered on the market and are seen with different value. According to a small survive, 8 out of 10 people that never staid before in one of this two hotels, and using internet to book a room, wood book a Hilton property. The same survive offered to world travellers that staid at many Hotels managed from Hilton and Marriott (7 out of 10) is more oriented to Marriott hotel for the quality of service.

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