Assignment II
ICTM 401 Strategic Management for Travel Industry
Amica Rangnoktai ID- 5080579
Sumandeep Thakral ID- 5180657
Naval Thakral ID- 5180658
Vethida Sithichaiudom ID- 5180832
Shivanshai Sethichaiyen ID- 5280510
Table of Contents
Business-level strategy 2
Demographic factors: 3
Socioeconomic Factors: 5
Geographic Factors: 6
Psychological Factors 6
Consumption Patterns 8
Perceptual Factors: 11
Generic business- level strategies of Dusit 15
Supply chain management 21
Operation 26
Distribution 27
Marketing 28
Follow up service 33
Finance 34
Human Resources 35
Analytical Idea 39
Strategies relate to Vision and Mission 40
Competitive rivalry and dynamics 43
Strategic and tactical action 64
Corporate Level Strategies 82
Hotel businesses 97
Business-level strategy
Ø Market Segmentation
Market segmentation is the technique used to enable a business to better target it products at the right customers.It is about identifying the specific needs and wants of customer groups and then using those insights into providing products and services which meet customer needs. In addition, the businesses need to segment their markets is because customers differ in the benefits they want, amount they are able to or willing to pay, media (e.g. television, newspapers, and magazines) they see, quantities they buy and time and place that they buy(Riley, 2010).
However, there are various methods (or “bases”) a business can use to segment a market. Some of the most popular are summarized below:
1. Consumer Market
To begin with, Dusit Thani target two main group of customers based on their length of stay at the hotel that is short haul and long haul customers. Short haul customers are those customers that travel for business purposes and they make their booking at Dusit Club which is much more expensive and customer are willing to pay for it is just because of the extraordinary services that are provided to them. However, for long haul customers travel for recreational purposes and want to experience the uniqueness of Thai culture (Dusit International, n.d.).As a result, Dusit Thani does not have to depend on customers with low bargaining power as they target various group of customers. Therefore, for the market segmentation, Dusit Thani has divided their target market into many groups as they are various groups of customers that the company wants to focus:
Demographic factors:
The respondents of the research were the customers who used the services of Dusit Thani Hotel during the research period. Three hundred sets ofquestionnaires were distributed and all of them were checked for the completenessafter returned by the respondents. The respondents’ profile covers the respondents’gender, age, purpose of their trip, monthly income, and education level as shown onbelow.
1. Gender and Age of the respondents
Based on the research of 300 respondents, there were 195 malerespondents or 65 % and 105 or 35% females. Within 195 male respondents, 68.5%or 63 respondents were aged between 20-30 years old. 93 respondents or 65% weremale who aged between 31-40 years old. 25 respondents were respondents were male whose age were between 41-50 years old and 14 respondents or 70% were malewhole age was more than 50 years old. Moreover, the rest 105 respondents werefemale or 35% of the total respondents which composed of 29 respondents who werefemale aged between 20-30 years old, 50 respondents were female who aged between31-40 years old, 20 respondents were female who aged between 41-50 years old andthe rest 105 of 35% were female who aged over 50 years old. From respondents ‘characteristics as described by age group mostly the main respondents were both maleand female who aged between 31-40 years old. As a result, we could see from the statistics that 65 percent of male visited the hotel and only 35 percent of female visited the hotel. Therefore, more number of males are visiting the hotel than the female.
2. Gender and The purpose of Trip
Out of 300 respondents, there were 195 malesrespondents, in which 143 male respondents indicated the purpose of their trip as fortravel purpose while the other 52 male respondents indicated their purpose as leisuretrip. And for 105 female respondents which comprised of 43 female respondentswho took their trip for travel purpose while 62 female respondents took also theleisure trip. This finding also indicated that both female and male guests of Dusit Thani indicated that purpose of their trip is for travel and leisure purposes. Unlike business travellers, leisure travellers tend to spend more time in the hotel due to varieties of activities offered by the hotel with standard service quality. For example, Dusit Thani offer fitness center and spa service and they ensure that they run smoothly.
3. Marital Status and Purpose of their trip
Based on this survey, I found that 190 of 300 respondents or 63.3% were married while 84 of them (28%) were single.The rest 26 respondents were divorced. The finding also indicated the purpose of thetrip crossed with the marital status. As a result, respondents who were single and married were more likely to take the traveltrip rather than leisure trip but respondents who were divorced were more likely totake the leisure trip than travel trip.
4. Nationality of the Respondents
The nationality of the respondents, out of 300 total respondents, majority ofthe respondents were Japanese which was 66 respondents is accounted for 22%,second largest group was American which was 60 respondents or accounted for 20%.European respondents were ranked as the third largest group, which were 58 out of300 respondents or 19.3%. The fourth group was British respondents; there were 55British respondents or 18.3%. The fifth group was Korea, which were 29 respondentsout of 300 or 9.7%. Australian respondents were ranked as the six largest groupswhich were not quite much, only 21 respondents out of 300 or 7%. The othernationality group was accounted for 3.7% or 11 respondents out of 300. There indeedwas a wide spectrum of customers of this Hotel come from Asia and Europe, whichindicated Dusit Thani Hotel, tends to target customers of Middle East as they have high spending power and mostly male for business purpose.
5. Monthly Income (in Thai Baht)
Based on the survey, 19 respondents or 6.3% respondents had the monthly incomebetween 20,000 – 39,999 Baht. 15 respondents or 5% were those who had themonthly income between 40,000 – 59,999 Baht. 25 respondents or 8.3% were thosewho had the monthly income between 60,000 – 79,999 Baht. 114 respondents or 38%were those who had the monthly income between 80,000 – 99,999 Baht. And the restof them or 127 out of 300 respondents or 42.3% had the monthly income above100,000 Baht. Surprisingly, the majority income group of Dusit Thani wasthose who had income 100,000 Baht per month and above which was accounted for42.3% while the least group was those who income ranged 40,000 – 59,999 Baht permonth which was only 5% for this group of respondents. As a result it is expected that.
6. Education Level
Out of 300respondents, there were 217 respondents or 72.3% who were Bachelor Degreegraduated. 49 respondents or 16.3% were under Bachelor Degree and 34 respondentsor 11.3% were those who had higher than Bachelor Degree.It is expected that most of the customers of this hotel to be educated orschooled as they were coming from a higher income group and were in for businesspurposes. Therefore it is likely that they had gone through tertiary education (Roongravi, n.d.).
Socioeconomic Factors:
v More woman business travelers
The social and cultural environment consists of broad societal trends which affect hotel organization. The most profound social changes in recent years have been the entry of a large number of women into the labour market. Women are earning more money than the past and are remaining single longer. And they may travel more for all business and leisure purposes. It has created or greatly expanded the demand for a wide range of hotel products and services necessitated by their absence from home such as hotel with spa treatment and fitting room. This factor has a positive impact on Dusit Thani because they have a chance to increase their revenue as well as increase the service quality of spa and fitness center by offering special training course for employee in order to improve female guest's satisfaction. From this fact Dusit has created a strategy to support this female market by introducing their spa to a unique that provides their guests with a luxurious, sensory and therapeutic experience. The Devarana Spa at Dusit Thani is offering a range of relaxing and results driven treatments, including facial, water and beauty treatment. Moreover, Dusit Thani has created their own spa products by bringing the best quality of ingredients to produce the botanical spa collection which includes body care, oil blends and heaven scents. Each of the products has the Devarana spa trademark stamped on the packages.
v More Family with children market
From the Family Travel Forum's, said that hoteliers need to pay more attention for a family market, especially a family with children. After five years studied the family vacation market, the report concluded that “just-for-kids” amenities are more important with family vacationers because if the kids aren't happy, no one's happy. Kid's satisfaction is key successful for hotel industry now because it plays an important role in the repeating of their parent at the accommodation so that the hotel should have new target market - younger guest market. According to a 2009YPartnershipreport, 43% of U.S. adult travelers took one or more trips with kids in 2009, up from just 26% in 2000. Therefore with these information added with the evident from Dusit Thani Hotel, Marital status, in which shown there are a tremendous number of business men and women who already get married and might bring their kids with them for the vacation. Dusit Thani Hotel should consider investing more in family amenities such as kid-themed family suites, children's programs, water slide, kid club and welcome gifts. With some extra amenities it is also an opportunity for hoteliers to charge for at least some of their kid-pleasing amenities. I am quite sure that many parents are more than pleasing to pay for the happiness of their children. In another hand if the hotel don't have any of the kid facilities and amenity, many business parents may denied to stay in another hotel or choose the alternative hotel which can comply with their need.
Geographic Factors:
When traveling, we can say that the locations of our accommodation will play a big role in overall enjoyment of the trip. That's because a well-located hotel will significantly cut down on the amount of time we waste in traffic or trying to navigate an unfamiliar place. For business travellers, centrally-located hotels will increase productivity by allowing them more time to work and meet with colleagues. For Dusit Thani Hotel, this is ideally located in the heart of Bangkok, known as the “City of Angels’. The luxury hotel is adjacent to both the sky train and subway systems within easy proximity to major business, shopping and entertainment centres. Additionally, Dusit Thani is well positioned to take advantage of selective investment opportunities in strategic locations that offer attractive returns, while at the same time the strong brand continues to be compelling to developers of luxury hotels. Moreover, Dusit Thani tends to target by regions as well including Europe, Oceania, East Asia, Asian, and American. By national differences including United Kingdom, Germany, Japan, Hong-Kong, Australia, Switzerland, Italy, Singapore, Korea and American market.
Psychological Factors
v Brand awareness
The first thing to recognize when we talk about brands is that they are not just names, terms, symbols, designs or combinations of these, although it is true to say that such things can and do differentiate certain products and companies from others. The additional ingredient that makes a successful brand is personality. Today’s leading brands are personalities in their own right and are well known in all societies. Brand has truly psychological factors involved as it gives consumers the means whereby they can make choices and judgments. Bases on these experiences, customers can then rely on chosen brands to guarantee standards of quality and service, which reduces the risk of failure in purchase. Dusit Thani themselves see the very important in the brand awareness, they has built their brand to be very strong as they have stated in their mission statement as to make Dusit one of the world’s most valued hospitality brands in preference and loyalty across every one of its competitive segment. Moreover, the core of the Dusit Thani brand is offering its customers an exceptional hospitality experience that reflects the unique artistry and culture of Thailand. Every hotel under the group offers the unique experience and ambience including the taste, smell and the friendly service. The management team has ensured a continuous investment in all aspects of the brand to ensure consistent delivery of all the brand promises. Furthermore, Dusit Thai has used Fan Campaign as one of the strategy to support their brand. This fan campaign has a great influence to people when they look towards the brand in ways that if the celebrities has stayed in this hotel before then it is most likely that this hotel is really good and this is install into the perceptions of the customers.
v Sustainable Tourism