Module title: Service Marketing
The Accra Beach Hotel
The Accra Beach Hotel is situated on the Caribbean Island of Barbados which is a popular holiday destination. The country’s main economic drivers are tourism, offshore banking and financial services sector that explain visitors’ profile. In 2010 Barbados received 532,180 tourists among those UK, USA and Canada were the main one 181,054, 134,969 and 72,345 respectively. (Appendix 1)
Since Barbados in the past was a British colony, UK tourists provide about one-third of all overnight visitors to the island. In addition, interest in cricket is one of the historical echoes of Barbados.
There are two major factors that affect demand ...view middle of the document...
In May hotel records more corporate travellers.
The current market of the hotel is focused on three different segments: individual tourists, corporate and tour operators’ clients. The purpose of segmenting is to define the major types of demand and allow better understanding of their needs. Serving different segments has the following advantages:
- It guarantees the revenues. When income from one segment is damaged for some reasons, there are two others as a backup.
- It optimizes available resources and as a consequence optimizes the revenues. Same tangible and intangible resources are used to serve different segments.
However, serving different segments have its drawbacks:
- Bad understanding or adaptation to the needs of different segments may cause customers’ dissatisfaction and as a result damage hotel’s reputation and incomes. For instance, the Accra Beach hotel guests were complaining about seeing suit-clad businesspeople around while having the vacation.
- Lose in quality and expectations. Willing to serve everybody, available resources may not be at customers’ expected level.
The Accra Beach Hotel should accept the booking request of West-Indies Cricket Board for different reasons.
First reason is financial. Accepting the offer, the hotel earning would increase by $52 035, even though the hotel offers 50 rooms at a lower rate, at $130 per night per room and provide laundry service and practice gear at no additional charge. Besides, we suggest the hotel to use the in house laundry facilities in order to reduce the costs. In fact, if the hotel is going to reject some average seasonal visitors to accommodate the WICB, the forgone revenue would represent $115,916. However, the WICB would guarantee $167,951 revenue during the period of April to June. (Appendix 2 Financial analysis)
Second, the hotel could benefit from the marketing exposure. As the WICB promised to list the Accra Beach Hotel as the host hotel in all promotional materials and during the televised matches, it will raise the reputation and competitiveness of the hotel.
Third, since cricket is the second most popular sport game in the world with 2-3 billion fans across the UK, India, Asia, Australia and others, the offered free publicity would reinforce hotel’s positions and give access to new potential customers.
However, possible mentioned advantages require considering the following factors. First and most challenging is the guest experience knowing that such event is a new experience for hotel management and customers. It’s difficult to predict guest reaction to the presence of the cricket team that might be noisy and will certainly be under extensive journalist attention. If everything does not run smoothly, the hotel risks damaging its image and generate negative word of mouth that could tarnish the hotel’s reputation.
Second, the hotel management should be mindful of loyal customers’ reaction who won’t be able to book their holidays during...