park royal
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Marketing Case Study
Prof. G.K. Saini
Submitted By:
Amit Sinha
Gaurav Mehta
Girish Muralidhar
Manoj Kumar
Pravin bang
Rahul S
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Executive Summary
Of the many industries in the world, the hospitality industry is one which is dependent not only on
the people who visit, but the location, demography of the population it wishes to penetrate and so
on. Let us also not forget the fact that nature too plays some of its tricks on hotels.
The Primula Park Royal (PPR) in Terengganu, Malaysia, is a fine example of disinvestment
working its miracles and the merits being earned despite being a down and out case. Having made
severe losses, the State Government of Malaysia decided to lease the PPR to a private entity called
the Southern Pacific Hotel Corporation (SPHC), with a 12 plus 5 years plan back in 1996. The
lease is to officially end in 2013, and it waits to be seen what the future will be of PPR.
The quality of the hotel was failing being managed by the bureaucratic State Government who
could not make the most of its strategic location being located on a sea-front. This was a problem
which was addressed by SPHC. Following this, they also addressed the problem of remarketing and
positioning the hotels positives, and finally, ensuring that a thorough revamp of the hotel would be
done, so as to put it on the map and brave whatever problems it may face in the future.
While some of its advantages may have been the sheer volume of rooms offered and the other
facilities of PPR, it takes more than just mere planning to set things in motion and achieve a critical
amount of momentum. The report takes up the bulwark of answering the questions of which
segments would be targeted in order to achieve the goals, and also the service offer which would be
designed for the segment in question.
The right operations and correct problems which were addressed form the major part of our report,
which illustrates the answers to the problems which were posed in the questions.
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SEGMENTS CHOSEN: Room Division
PRIMARY TARGET SEGMENT
We have identified Commercial Guests as our primary target segments. This is mainly because:
They form a significant percentage (30.1%) of our existing customer baseThis group of customers is least impacted by the seasonal fluctuations inherent in the
business. As a group, we can bank upon them visiting all round the year
Our value proposition (a 4-star, sea-facing, luxury hotel cum resort) is something that is best
suited for this group of customers
SERVICE OFFERINGS
Complete convention/conference package
Apart from the hospitality services at our resort, we would be an end-to-end convention/conferencesolutions provider. This would mean arranging all the events related to the conferenceright from
airport pick up to getting them back to the airport. We would ask our potential clients to plan their
meetings and leave the implementation part on us.
Corporate Client Accounts
We would have tie-ups with big corporate houses. We would be their hospitality partners for all the
major conferences, seminars and meetings. As proposed above, our value proposition would be that
of an end-to-end solutions provider rather than just a venue for the event.
Business with Leisure
We would also market ourselves in such a way that delegates/corporate who visit Singapore for
conferences, seminars and meetings can visit Terengganu and stay at our hotel. Since it takes only
an eight-hour drive to reach Terengganu from Singapore, the delegates/corporate can easily visit the
place for a day or two. We can also market ourselves as a place where business and leisure go hand-
in-hand. A tentative tagline can be:
When it comes to leisure, we mean Business
Corporate Networking Strategy
offers targeted at corporate
We would also have special offers for corporate, something akin to privilege cards given to
individual travellers. It would be a year-long agreement where we would provide our regular clients
with certain perks/privileges based on the number of times we get business from them and the
amount of revenue we generate because of them. To give an analogy, it would be something on the
lines of frequent flyer miles used by airlines.
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SECONDARY TARGET SEGMENT
We have identified Individual Guests as secondary target segment. This is mainly because:
They form a significant percentage (29.0%) of our existing customer base
The average tariff is significantly higher which would help overcome the problem of low
occupancy
SERVICE OFFERINGS
Physical Facilities such as Unisex Saloon & Spa
Unisex Salon & Spa is no longer a luxury, but rather a standard amenity, expected and ubiquitous.
Significant cross pollinating among the day, medical, amenity, and destination spas has created a
competitive and comprehensive spa environment that here-to-fore that has never been experienced.
This dynamic has created the phenomenon of Spa Wars, where product differentiation is subtle and
the competitive edge can be paper thin. This may seem like a no-brainer, but creating a niche is a
must. Sheraton Hotels & Resorts, a previously spa-less brand, is now working to debut spas in all
its properties worldwide by 2012.
We can outsource this saloon and spa services to the best in the town and can share profits
generated.
Progressive Discounts
Individuals and couples can be offered a progressive discount on their stay on numbers of days at
the hotel during off-peak season. They would be provided with a privilege card that would keep atrack of their loyalty and data in order to provide them the offers and benefits of the hotel during
off-peak season.
Customized packages for banquets during off-peak
Banquets can be booked at cheaper rates during the off-peak season in order to generate revenue
from F&B operations. The offers can be well marketed to the individual segment who wants to
make certain events in their life memorable assuring that event will satisfy their requirements and
exceed their expectations.
Cruise ship
A cruise is a star attraction. The individuals and couples could take the advantage of being at the sea
site. There are river cruises where you can enjoy the pleasures of boat cruise as well as sea cruises
options for you where you can sail through the vast oceans enjoying the awesome beauty of nature.
A one hour trip that cost a sum of Malaysian Ringgitsper person. Cultural entertainment programcan be included, troupes performing different dance. A bit of sightseeing during the cruise is also
on.
Events arranged during off-peak season
Special events such as Anniversary, Birthday, promotions etc can be organized for the couples
staying at the hotel to showcase their hospitality and retain the customers forever.
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SERVICE OFFERINGS: Food & Beverages
Outsource staffing for the liquor business
Permodalan Terengganu Behard (PTB), the Terengganu state governments investment arm,
became the new owner of the Hotel before the new management took over. PTB is running its
operations based on Islamic principles and thus incomes from alcoholic beverages were treatedseparately from income from other hotel operations. This special accounting treatment was made to
cleanse the hotel revenues.
Some of Islamic staff may have reservations about serving alcoholic beverages to guests. So
taking this factor into consideration we propose to outsource the staffing of the alcoholic beverages
operations in the Hotel premises to an external agency.
Customized packages for celebrations
A significant number of guests who come to hotel are there to celebrate certain special occasion like
birthday or wedding anniversary. We would have customized packages for such occasions which
would include special menu depending upon the nature of the occasion.
Customer feedback and up gradation of menu if required
Feedback would be taken from guests regarding the menu and recipes. They will also be asked
whether they would like to see any other variety of cuisines in the menu. Depending upon the nature
of their responses the menu will upgraded after 4 months. This measure is to factor in the
preferences of the guests in the menu.
Separate menu for health conscious / health compromised people
There will be a separate menu for health conscious and health compromised guests. The menu will
include dishes and cuisines which are low on calories, cholesterol and spices. Since this is a unique
offering for a niche customer segment thus it would be charged at a premium.
HR PLAY
Recruitment Practices
Recruit from off city limits for better value driven basic staff who would stay on for longer and who
would be in sync with the Malay culture [Taj India does this on a regular basis]. The focus should
be on fresh-out-of school kids with a pleasing personality. Training programmes/internships with
zero person cost and a stipend would ensure employer loyalty and lesser turnover in long run.
Recruit the needy and empower them to make decisions. Customised etiquette and English speaking
classes to sync with both Malay and International culture, would eliminate any apprehensions hotel
staff can have while interacting with the guests.
For midlevel staff, have tie ups with hotel management institutes with a service clause for identified
students.
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For supervisor and entry level manager cadre, tier 2 b-schools to be approached as basis of studies
show that they tend to look beyond money and focus on longevity at the place of work.
Moments of Truth Interactions [MOTI]
Studies have shown that on a typical 24 hour stay in a star hotel there are about 40-45 moments of
customer-staff interaction [varying from a few seconds to a few minutes]. Repeat businesses are
generated on how successfully one manages these moments in favour of a lasting impression. By
empowering employees to take control of those moments and by having a training programme
address this along with an engagement initiative which will value those key moments seizesby staff
will go a long way in building employer brand.
Special Thanks and Recognition System [STARS]
It is a customer delight linked incentive programme. A three pronged approach where engagement
/reward index is arrived after weighing in the compliments from the guests, peer/360 degree
feedback and value of employee suggestions delivered.
For senior management levels, role rotation across the Park group chain and round the clock family
suite availability can be measures aimed at maintaining an essential connect linked to quality of
services offered by him/her.
Royal Days: Breaking the Barriers
In order to engage employees we will celebrate two days during the off peak season with all the
employees along with their family members. An informal interaction coupled with fun activities
will go a long way in engaging the employees of the hotel as their alliance with the hotel will be
recognized and demonstrated. These days will also mark the recognition of employees who haveserved the organization for longer years by Wall of Fame induction along with a short verbatim of
their stay with the hotel. This will inspire other employees to also reach the landmark and hence
reduced attrition should be observed.
Learning and Development
Since most of the learning is on the job (including simulation to actual situations), we have devised
a training plan which includes OJT during peak season where they can learn immensely by
observing the star performers serve the customers under real live situations. This will give them a
real feel of the situations that they will be facing in the near future and hence will be betterequipped to handle them. Apart from this classroom training will be delivered during the off peak
season since the work pressure will comparatively lesser.
Performance based Incentives
We devise a performance based incentive scheme for the junior staff wherein they will be rewarded
based on customers feedback & rating. The incentive sharing will be during the off peak season
which will substantially reduce any turnover during the peak season.
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