Marketing
Introduction
Studies on marketing employ primary and secondary data. Ad hoc surveys are conducted to collect primary data and secondary data is collected from prior data in the form of official statistics, works of scholars and the like (Tasic & Feruh 2012).
According to Booth, Colomb & Williams (2008), ‘Primary sources provide the raw data that you use first to test the working hypothesis and then as evidence to support your claim’. Primary data is advantageous because it is relevant and original and hence the level of accuracy is high. Primary data may be garnered by a number of manners like focus groups, surveys, interviews and the like. It includes wide geographical network and a large population sample. Another benefit is that this data is recent and hence it provides excellent practical opinion about the relevant assignment. The reliability on primary information is high as it is garnered by reliable and concerned party. Primary data may be disadvantageous as it requires greater efforts and longer time for collecting data. Interviews as a medium to collect data may not have a wider coverage. In case of survey, respondents may delay providing responses. This data collection needs trained individuals. Some kinds of primary data like questionnaires may have no control over the data collected.
Secondary data is defined as “the use of existing data collected for the purposes of a prior study, in order to pursue a research interest which is distinct from that of the original work’ (Grinyer 2009). Secondary data is advantageous as it is accessible fast and is cheap. It allows to access activities of best scholars across the globe. Secondary data is time saving and saves on money and efforts and also helps to add value to the study. It also gives a direction to the researcher for pursuing the particular research. This data helps in enhancing the comprehension of the research issue. It also allows the researcher to compare the information garnered. Secondary data may be disadvantageous as it may or may not be reliable because it is collected by third party. The information garnered in a particular area may not be applicable in another area. With the passage of time information becomes old and obsolete. The research outcomes may be distorted by secondary information. Issues with reference to copyright and authenticity may arise in secondary data. However, in all studies primary and secondary data is needed.
It is very essential that certain ethical considerations are made while collecting primary and secondary data. Secondary data have been often alleged to have “poor empiricism” in ethics and the question of integrity has arisen in the collection of primary data. Hence, it is very essential that ethical considerations are taken into account while garnering data (Nicholson & Bennett 2008).
Hilton worldwide – an overview
Hilton Worldwide is an American multinational hospitality organization which has diverse hotel chains. It has properties offering services from luxurious hotel accommodations to mid priced properties to suites designed for extended stay. The past 93 years have witnessed this hotel to provide excellent services in accommodation and hotels to leisure as well as business travelers. It is solely dedicated to providing excellent guest experiences all through its international brands (Hilton.com 2011).
Hilton is a public limited company and manages diverse portfolio of hotels like Conrad Hotels & Resorts, Waldorf Astoria Hotels and Resorts, Home2 Suites by Hilton, Homewood Suites by Hilton, Hampton Hotels, Hilton Grand Vacations, Hilton Garden Inn, Embassy Suites Hotels, Doubletree by Hilton and Hilton Hotels & Resorts.
The first Hilton hotel was launched in the year 1925 by Conrad N. Hilton with the primary objective to excel as the number one hotel in Texas America. Today, one of the most renowned worldwide hospitality brands in Hilton Worldwide. The hospitality conglomerate has its presence in 85 nations across the globe and has around 3750 properties. Despite this the organization has garnered a saving of over $74 million in utility expenses in the year 2010. It is following a sustainability program which has witnessed a decline in carbon output by 7.8 percent, decline in energy consumption by 6.6 percent and decline in the usage of water by 3.8 percent. It is trying to gain competitive edge by providing the measure of sustainability to be a brand standard (Foster, 2010). It got a global ranking of 36 in the year 2010 and as per 2011 statistics it has earned around $8 billion revenue (Forbes, 2011).
The year 2007 witnessed a major restructuring in Hilton Worldwide with the changeover to a new management headed by Christopher J. Nasseta, the Chief Executive Officer and President. The establishment of a performance driven culture and an internationally aligned firm has helped the hospitality conglomerate to sail through the recession. Between the years 2007 to 2013, the organization has undertaken the following:
- The number of rooms has been augmented by 36 percent thereby making Hilton Worldwide to witness higher rate of growth.
- The aggregate rooms under construction have been increased to 133 percent.
- The company has globally expanded by augmenting its rooms to around 60 percent outside the United States of America in its development pipeline. The under construction rooms outside the United States of America has witnessed an increase to 80 percent.
- The international presence of this brand has been significantly improved by the launch of Home2 Suites and Doubletree by Hilton in Europe and Greater China.
- Member in the Hilton Hhonors program has been expanded since 2007 to 88 percent.
- Competitors have been outperformed in the timeshare sector by the increase of yearly interval sales to 40 percent since the year 2007.
- Profitability has been enhanced to 12 percent annual average to 2010 which witnessed the increase in the net attributable income to the stockholders of Hilton to 68 percent from December 2010 to December 2012. The net attributable income further registered an increase of 34 percent from December 2012 to September 2013.
The transformation of Hilton Worldwide has thus aided the organization to gain competitive edge and remain as one of the premier global firms despite the uncertain market conditions (NASDAQ, 2014).
Competitor analysis
The main competitors of Hilton Worldwide are Intercontinental Hotels Group which is headquartered in the Great Britain, Marriott International and Wyndham Hotels Group. Currently Intercontinental Hotels Group is the leading hospitality firm closely followed by Hilton Worldwide, ranking in the third place is Marriott International and the fourth place is occupied by Wyndham Hotels Group.
Marriott International - One of the major competitors of Hilton Worldwide is Marriott International. It has a market share of 5.6 percent and is the most sought after hospitality firm after Hilton Worldwide. Marriott International is headquartered in Maryland, USA and has nineteen brands (including the recent acquisition of Gaylord Hotels) and more than 3800 hotels under its platform. The Marriott Rewards Program has surpassed 41 million members (Marriott, 2014). The firm has its presence over 74 nations across the world. The year 2012 has reported revenues up to the tune of $12 billion (Marriott 2014). The competitive strategy of Marriott International is the usage of a broad differentiation plan which ensures that multiple hotel brands cater to diverse customers in the hospitality industry and the brand has properties for leisure, corporate and budget consumers (Marriott International, 2010).
Intercontinental Hotels Group – this group is the leading hospitality organization and follows innovative strategies to gain competitive edge. Its strategy to aid customers to book rooms online has been followed by all other hospitality players and initially this strategy had witnessed tremendous room sales online. Currently this hospitality conglomerate is restructuring its processes and systems to gain competitive edge. Especially brands like Holiday Inn and Crowne Plaza are being internationally repositioned to gain competitive edge (Crowne Plaza Hotels & Resorts 2011).
Wyndham Hotel Group – Wyndham Hotel Group is one of the leading hospitality chains and has the largest number of properties under its banner. The group has around 30 brands including Ramada, Tryp by Wyndham, Wyndham Hotels and Resorts and Days Inn (Wyndham Worldwide 2014). The firm gains competitive edge due to the manner in which it has segmented its operation strategies into vacation ownership, rentals, vacation exchange and lodging. The hotel has spread its wings across USA by providing 51000 hotels and catering to around 4.8 million rooms. The year 2012 has witnessed annual revenue of $115 from US markets. Moreover the hospitality group has over 70 percent brand affiliation in the USA and this aid in ensuring that Wyndham Hotel Group remains as one of the global leader in the hospitality industry. This group has around 153000 hotels worldwide and the integrated yearly revenue for the year 2012 was around $380 billion. The group has geographical concentration in around 20 nations and accounts for around 80 percent of rooms internationally (Wyndham Worldwide Corporation 2012).
The below table displays the ranking of these four hospitality firms and the figures shows current details as per January 01, 2013.
Source: MKG Hospitality Database – March 2013
The top position has been occupied by Intercontinental Hotels Group and has registered no change, but Hilton has climbed up the ladder to gain the second position by beating Wyndham Group Hotel. The percentage growth registered by Hilton International has been higher as compared with the Intercontinental Hotels Group and has less than 24000 rooms as compared with the Intercontinental Hotels Group. The IHG group has a competitive edge by means of the Holiday Inn Group of hotels and is completely restructuring this brand. Marriott International is very close to Hilton Worldwide and has surpassed revenues above Wyndham Hotels Group. However, Marriott International is still concentrated on its home turf and needs to expand globally in order to match stringent competition (Hospitalitynet 2013).
The competitive strategies adapted by global hotel chains are to attain the creation of value and the year 2011 has witnessed Marriott International to be the global leader in this arena by adding 4.9 percent value, closely followed by Hilton Worldwide at 4.3 percent and Intercontinental Hotels Group at 3.9 percent. Wyndham Hotel Group registered a value percentage of 1.8 and attained the sixth position.
The Intercontinental Hotels Group has the largest number of rooms in the international pipeline with maximum focus (45 pecent) in USA. It may be witnessed that the Marriott, Intercontinental and Wyndham have the maximum number of rooms in the pipeline for USA. Wyndham Hotel Group is also emphasizing on expanding operations to China, Brazil and India and has projected to erect around 35 Howard Johnson properties by the year 2017 in India (World Travel Market 2013).
The above figures project that there exists stringent competition among the leading global hospitality chains and it is extremely necessary to include sustainable business practices and embrace the best of technologies to gain competitive edge and to remain in the global hospitality market.
Current target audience and promotional channels
Hilton Worldwide is embarking to target broad customers ranging from leisure to corporate to long staying guests to budget customers. The target audience has been widened with the foray into the Asia-Pacific market. Also the conglomerate is developing several properties in Latin and North America. It has a broad set of audience that comprise of Japanese, Spanish and German travelers.
The promotional strategies of Hilton Worldwide have been designed in order to attract the target audience and also to open new avenues so as to garner more customers. One of the most important strategy is to develop a broad brand which provides diverse hotel experiences ranging from luxury, 5 star and 4 star properties to hotels located in the city centre and in close proximity to conference and convention centers to providing mid-priced properties, suites and extended stay properties, airport hotels, holiday ownership and destination resorts. Such brands have been designed especially to target niche audience and accordingly customers are targeted by means of the HHonors Loyalty Program, which has been re-launched to suit customer tastes (Marketingweek 2011). The promotional channel of Hilton Worldwide have clearly positioned its diverse brands to suit the tastes of current target audience and each brand caters to one of more customer types. The Hilton campaign of “connecting” with customers smartly de-commoditize hotels by associating emotionally with customers so that the main constructs of price and location while selecting an accommodation is no longer highly relevant in the minds of the target audience. The brands have been broadly classified into full service, emphasized service and luxury so as to bring in broader target audience. This strategy has been formulated in the wake of its widening global operations across India and China and its endeavor to garner more funds from the UK market, which is the second largest market for this company after USA (Barnett 2011).
Hospitality promotional channels
It is essential for hospitality conglomerates to implement and promote information and communication technologies (ICT) to improve efficiency in operations. Studies have established the favorable association of hotel performance and the implementation of ICTs and hence Hilton Worldwide should establish this process to gain competitive advantage (Sirirak, Islam & Khang 2011). One of the most effective direct online marketing medium is the website of the hotel. Hilton Worldwide should emphasize on its website as one of the channels which displays the adherence to comply with the best practices in distributing the services and products. The website should display best practices with respect to corporate social responsibility and the manner in which it aids in bettering the society. This should even spread to countries having global expansion on the pipeline. One of the most beneficial strategies which Hilton Worldwide has commenced is the translation of its website to German, Spanish and Japanese. This aids to woo global travelers. Given the fact that the hotel is expanding operations to the Chinese market, adapting this strategy would help in further promotion of its properties in China. Hilton Worldwide should have a commodity associated competitive set which allows the customer to compare the hotel with respect to amenities and geographic location. Each property should strive to provide a distinguishing characteristic which may aid to convince the client to select the same.
One of the recent and effective promotion channels is social media. It has made possible to connect with international audience, immediate contact without time lag, easy accessibility to communication receipt and versatility for interactive communication (Kasavana, Nusair & Teodosic 2010). Hospitality giants like Hilton Worldwide should aggressively use this channel to spread awareness about its brands and to implement the strategy to woo customers by means of social media. Websites like Facebook and Twitter have been most successfully used by hospitality firms to win customer loyalty. In fact, Hilton Worldwide should use these social media sites as a platform for extended booking hotels and also allow customers to provide feedbacks and comments.
Conclusion
Hilton Worldwide is one of the leading hospitality firms and has a lot of do in order to establish business globally. Currently it has high concentration on the domestic market and it needs to spread its wings more aggressively in order to expand operations globally. The company needs to strategize and promote its products in a manner which aids to carve a competitive edge. This may be attained by using effective promotion channels and updated technology. The brand promotion should ensure that in emerging markets, promotion channels are both direct and indirect. Direct channels may encompass the website, sales and marketing professional as well as strong advertising and marketing campaigns. Indirect channels may be by means of word of mouth publicity and using a third party website to promote its brands. All in all, an effective blend of promotion channels will aid the conglomerate to garner competitive edge and experience enhanced growth.
References
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