Completion Date
CONTENTS
I. Background3
II. St. Regis Mumbai: Strategy & Implementation: Overview...5
II.I. External Operation Environment: Opportunities & Threats6
II.II. Internal Operation Environment: Strengths & Weaknesses..7
II.III. SWOT Chart...8
III. St. Regis Mumbai Strategy: Evaluation..9
III.I. St. Regis Mumbai Strategy: Mission & Objectives9
III.II. St. Regis Mumbai Strategy: Business Model9
III.III. St. Regis Mumbai Strategy in Theory..10
III.IV. Recommendations11
IV. Conclusion..12
References.14
St. Regis Mumbai: Strategy Implementation Analysis
I. BACKGROUND
St. Regis has a global presence of 58 hotels in four continents: North America, Africa, Asia and Europe in 23 countries ("Global St. Regis Hotel List," n.d.). St. Regis Mumbai, one of St. Regis's hotels in India and a Starwood and Marriott brand ("Investor Relations," n.d.), is one of hotel's chain's most recent hotels and most luxurious. St. Regis Mumbai emphasizes, above anything else, luxury, prestige and service excellence, all of which are evident in hotel's professional and tenacious concierge staff, palm-lined outdoor pool, an ultra-modern gym, a deeply cossetting spa and, not least, ample business and conference facilities (Cobaj, n.d.).
The high profile of St. Regis Mumbai is, in fact, clearly stated in not only hotel's affiliation to world renowned Marriott but also to hotel's location. Specifically, St. Regis Mumbai is located in India's Financial Capital, i.e. Mumbai. This specific location, as is shown very shortly, projects an image of St. Regis Mumbai as an exclusive space for high profile guests, particularly business ones. On hotel's corporate website, hotel's specific location (462, Senapati Bapat Marg, Lower Parel, Mumbai, Maharashtra, 400013, India), local weather (Haze, 26 °C / 79 °F), local time (7:38pm ) and contact information (+91 (22) 6162 8000) are clearly stated on website's home page, a feature not offered by many similar global hotel chains (St. Regis Mumbai, 2015-2017).
Further, in order to cater for hotel's high profile guests, St. Regis Mumbai offers a broad range of leisure and entertainment services. These include, for example, nightlife facilities ("Dining & Nightlife," n.d.) and a global Seven Kitchen cuisine offering food and beverage offerings from Italian, Oriental, Indian, Japanese and Mediterranean cuisines ("Seven Kitchens," n.d.).
Figure 1. Seven Kitchens. (The St. Regis Mumbai, 2017)
As part of hotel's strategic communication plan, St. Regis Mumbai engages investors as well as corporate and individual customers by adopting specific marketing communication methods. For investors, St. Regis Mumbai offers detailed investor relation information backed by hotel's immediate affiliation to Marriott ("Corporate Overview," n.d.). Backed by Marriot's global reputation, St. Regis Mumbai has a long-standing performance record, at least in financial area, for existing and potential investors. Moreover, in order to engage corporate and individual customers / guests, St. Regis Mumbai offers a broad range of upscale services, as noted above, and emphasizes luxury and prestige for hotel's existing and potential guests / customers as in being located in India's Maximum City, particularly in city's, i.e. Mumbai's, premier entertainment and commercial district of Lower Parel and being India's highest building (The St. Regis Mumbai, 2015).
In order to better address St. Regis Mumbai's strategic market positioning, a closer look is required into broad and more specific market situation and hospitality industry operation environment in India. This paper aims, hence, to appraise strategies adopted by St. Regis Mumbai and to propose possible changes for better corporate performance.
This paper is made up of four sections in addition to Background: (1) St. Regis Mumbai: Strategy & Implementation: Overview, (2) St. Regis Mumbai Strategy: Evaluation, (3) Recommendations and (4) Conclusion. The "St. Regis Mumbai: Strategy & Implementation: Overview" section offers a broad overview of hotel's external environment, including a discussion of Opportunities and Threats. The "St. Regis Mumbai Strategy: Evaluation" section offers an analysis of hotel's internal, i.e. organizational, environment, including a discussion of Strengths and Weaknesses. The "Recommendations" section offers proposed changes in hotel's implemented strategies for better performance. The "Conclusion" section wraps up paper's discussion and offers further insights.
II. ST. REGIS MUMBAI: STRATEGY & IMPLEMENTATION: OVERVIEW
This section offers a detailed discussion of St. Regis Mumbai's external and internal operation environment. The first part, "External Operation Environment," discusses hotel's Opportunities and Threats external operation environment. The second part, "Internal Operation Environment," discusses hotel's Strengths and Weaknesses. The final part, "SWOT Chart," sums up discussions in first and second parts.
II.I. EXTERNAL OPERATION ENVIRONMENT: OPPORTUNITIES & THREATS
St. Regis Mumbai operates in a highly competitive hospitality industry. This operational environment is particularly competitive in India, a market witnessing radical changes in customer consumption patterns of hospitality products and services, not least because of India's emerging economy status at a global level. Given St. Regis Mumbai's current product / service offerings, informed by chain's parent company's, Marriott's, global and long-standing expertise in hospitality, St. Regis Mumbai is well positioned to serve not only India's high profile customers but also a global high profile customer base coming into India, particularly for business. Indeed, India's emerging middle class, reaping fruits of India's global rise as an economic powerhouse, is an important customer segment which St. Regis Mumbai addresses by offering diverse hospitality products / services in food and beverage, leisure and concierge (e.g. spa), conference service areas and, of course, a broad range of guest and residential offerings. Thus, by offering world class hospitality services, St. Regis Mumbai does not only cater to hotel's existing and potential, conventional, individual and corporate, business customers but also to India's rising middle class who does not only have an increasing disposable income but also are emerging as new customer segment of different (and more dynamic) customer needs.
On another hand, St. Regis Mumbai, adopting a fairly conventional business model, faces mounting challenges from merging players offering hospitality products and services catering to needs of St. Regis Mumbai's business customer segment. Notably, peer-to-peer accommodation services offered most notably by Airbnb pose risks to St. Regis Mumbai's current and near future market positioning. If anything, peer-to-peer accommodation services do not only offer business customers accommodation spaces at more affordable rates but also addresses needs of younger business customers whose accommodation habits and patterns are decidedly different from conventional, older business customers. Unsurprisingly, Airbnb offers a separate business service for business customers ("Business Travel," n.d.), particularly younger ones, well differentiated from "mass market" accommodation services offered on company's web platform. As is discussed later under "Recommendations," St. Regis Mumbai needs to cater to needs of an emerging business class whose needs, given current strategy offerings, are not adequately met.
II.II. INTERNAL OPERATION ENVIRONMENT: STRENGHTS & WEAKNESSES
Internally, St. Regis Mumbai manages an organizational setup which, given current situation, has strengths and weaknesses which define overall organizational performance.
On Strengths dimension, St. Regis Mumbai has a global and long-established reputation backed by Marriot's outstanding and luxurious hospitality products / services offered over years. This reputation and brand image power does not only led credibility to hotel's premium pricing marks but also, and probably more importantly, would offer an initial "inertia" for St. Regis Mumbai given hotel's recent opening. This initial inertia should, of course, be further boosted by specific value-differentiated products and services for a more sustainable medium and long range performance, as discussed below under "Recommendations".
On Weaknesses dimension, St. Regis Mumbai adopts, as noted above, a comparatively outdated business model. Facing serious challenges from peer-to-peer accommodation companies, St. Regis Mumbai, given current stated mission and vision, fails to cater to needs of a different business segment that is younger and more mobile. As discussed under "Recommendations," St. Regis Mumbai needs to develop specific marketing and promotion strategies, boosted by value-differentiated hospitality products / services to better cater for a different business segment class based on a partially or completely new business model.
II.III.SWOT CHART
III. ST. REGIS MUMBAI STRATEGY: EVALUATION
In balance, St. Regis Mumbai has a positive market positioning outlook. This market positioning is leverage by hotel's superior brand image and favorable macroeconomic factors in Indian market. In contrast, St. Regis Mumbai's market positioning, given current marketing and communication strategies, are challenged by emerging risks from growing, peer-to-peer competition and, internally, from an increasingly outdated business model which appears to fail to respond to needs of a different business customer segment. As shown in next section, St. Regis Mumbai's vision and mission remain particularly "hooked" to a business customer segment which could no longer be hotel's business driver as more fragmented business customer segments of different needs continue to emerge.
III.I. ST. REGIS MUMBAI STRATEGY: MISSION & OBJECTIVES
Consistent to hotel's mission and strategic objectives, St. Regis Mumbai has a clearly stated mission, under "A Meeting of Legacies" label, of catering to needs of a business class by offering a " new social epicenter for conducting business in the financial capital of India" (St. Regis Mumbai). This strategic objective of being a hub for India's business, combined by a corporate mission of catering to needs of a (conventional) business customer segmented in one of India's most premium property locations, underscores hotel's long range vision, at least as far as current adopted strategies in marketing and communication areas are concerned.
III.II. ST. REGIS MUMBAI STRATEGY: BUSINESS MODEL
As noted above, St. Regis Mumbai adopts a fairly conventional hospitality business model. By offering short and long (residential) stay accommodation offerings at premium price marks using conventional check-in / check-out policies; engaging high profile customers more by conventional marketing and promotion activities (e.g. Big Opening / Launch events); and, of course, offering fairly standard hospitality products and services expected by and aimed for a fairly conventional business customer segment – St. Regis Mumbai remains particularly vulnerable to growing pressures of peer-to-peer accommodation services aimed at business customer segments, particularly younger ones as well as innovative, value-differentiated services offered by established, global hotel chains. As discussed in further detail below under "Recommendations," St. Regis Mumbai needs to review in depth her current business model such as to better cater for different business customer needs.
III.III. ST. REGIS MUMBAI STRATEGY IN THEORY
More broadly, above mentioned strategies adopted by St. Regis Mumbai, particularly in areas of marketing and customer engagement areas, speak to hospitality industry's well established literature.
In marketing strategy area, St. Regis Mumbai's conventional brand image management practices are supported by literature's consistent findings on an immediate correlation between customer loyalty and brand image management. More specifically, by enhancing hotel's image of prestige and luxury, St. Regis Mumbai only ensures customer loyalty by offering premium housekeeping, reception, food and beverage offerings (Kandampully & Suhartanto, 2000).
In customer engagement strategy area, St. Regis Mumbai's well "groomed" and professionally developed staff confirms hospitality industry's literature on a direct correlation between human resource management (HRM) practices and organizational performance. More specifically, in a cross-sectional study spanning 439 hotels of different rankings, findings show hotel performance is positively associated with adopted HRM systems, recruitment policies, job design, quality circle and pay systems (Chand & Katou, 2007). Similarly, St. Regis Mumbai's current HRM systems, aimed at maximum customer understanding and satisfaction, only underscore how well established and superior customer engagement strategies, albeit in a conventional fashion, do not only ensure customer engagement is performed as per world-class standards but also, more importantly, customer loyalty over long range.
IV. RECOMMENDATIONS
As an internal consultant at St. Regis Mumbai, paper's author believes, given above analysis based on adopted and implemented strategies, St. Regis Mumbai needs to focus on specific areas in order to improve organizational performance, internally, and to better adapt to a rapidly changing hospitality industry, eternally. One can offer what can be said to be a Blueprint Recommendation List as follows:
Emerging Business Customer Segment. In order for St. Regis Mumbai to not only maintain her market positioning but also to expands into new market segments (now barely catered for by current engagement strategies), St. Regis Mumbai is recommended to value differentiate her product / service offerings by providing, for example, accommodation / food and beverage / leisure products and services which address needs of an emerging, younger business customer segment.
Business Model. Needless to say, St. Regis Mumbai has an "issue" with current business model. If anything, peer-to-peer services offered by a broad range of emerging startups and established players pose immediate challenges to conventional hospitality services offered by established players as St. Regis Mumbai. Thus, St. Regis Mumbai needs to "divest" her current business model by developing a separate, if possible, accommodation / food and beverage / leisure platform which caters for needs of an emerging business customer segment whose makeup and consumption habits are hardly reconcilable to conventional business customer segment's habits.
Digital Marketing Strategy. If anything, St. Regis Mumbai's current digital presence remains limited and does not appear to engage business customers in a more interactive way compared to peer-to-peer services. Thus, St. Regis Mumbai is recommended to better enhance hotel's digital media presence across different social media platforms and, of course, on corporate website which, in author's expert opinion, appears to be a more or less digitized brochure developed offline and posted online without, apparently, including interactivity and feedback features.
V. CONCLUSION
In balance, current strategies adopted by St. Regis Mumbai manage to achieve hotel's stated objectives and mission in a more conventional business model. In contrast, by failing to adapt to a rapidly changing hospitality industry, St. Regis Mumbai is recommended to adopt specific strategies in specific business areas in order to not only maintain hotel's market positioning but also to sustain a business growth over medium and long ranges. Needless to say, India's emerging middle class, combined by rapidly changing g business customer habits particularly among younger generations, are factors St. Regis Mumbai needs to consider for.
Throughout, a consistent need of an innovative business model for St. Regis Mumbai's has been identified. In contrast to limited product and/or service offerings, a revamped business model would be better able to capture emerging business customer segments which are an up and coming force in next decades. This business model should, as noted, consider not only for India's rising (and young) business class but also for a global (and young) business customer class who, doing business sin India, is more dynamic in business practices compared to a more conventional *and older) business class, now St. Regis Mumbai's most important customer segment, at least over short range.
In order to reverse a predictable course of a business growth slowdown if current strategies continued to be adopted as is unchanged, St. Regis Mumbai is recommended to focus on more innovative customer engagement strategies for younger business customer segments, business model's revamp and more interactive digital media strategy implementations.
REFERENCES
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