ESH Paris HotelSchool, Ritz Hotel, brand image, risks, strategy, communication policy, BSHT Business Strategy in Hospitality and Tourism, growth, competitive advantage, business environment, company, hotel, digitalization
The Ritz-Carlton group is an international high standard hospitality group which benefits from a strong brand and is the symbol of lux palace. Its strategy so far consisted on a good implementation, especially in the United States, Europe and the Gulf. On a most recent period, implementation started to develop on Asia, especially, on china and countries from the south-West of Asia.
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It is important to acknowledge that the Ritz-Carlton group is part of a very limited number of companies who benefits from the economic effect called the Velben effect. It describes a negative correlation, or, at least neutral, relation between the price of their services and the consumption of this service. Companies that benefit from this negative elasticity price are few, and their strategic innovation must not change that relation as it ensures a high degree of profitability and allows an important media coverage.
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Physical resources include buildings, fixtures equipment, machinery and transport vehicles. In terms of how useful and valuable, age, efficiency, reliability and fitness for purpose have to be essentially considered. As cited by Kapoor et al. (2011), concerning the Ritz-Carlton, Cooper, former President of Marriott International mentioned in an interview that the brand is keen on setting new trends instead of following the existing ones.
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According to Hofstede, as culture very often leads to conflicts and is it difficult to cope with cultural differences, it strongly has to be taken into account for a company to keep on being efficient (2009).
This example helps companies better understand the societies in which they already work or would like to work in, in the future, and enhances their particularities. Everything has to be considered to fit needs and environment.
Ritz Carlton benefits from a series of 17 hotels in Asia, most of them in business or holidays location. Choices of the location also reflect the type of public the group is willing to attract as it reveals a strategy of retention regarding its European and American clients on their holidays location and working location, but also offers those implementations to new clients from the region.
[...] Strategy is meant to give a company uniqueness, keep renewing the products and having the advantage towards the competition. The Ritz-Carlton hotel has been chosen as a case study to illustrate the theory of Business Strategy in Hospitality and Tourism. At the very basis, Ritz-Carlton was an investing company created by Albert Keller who franchised the name. Among all the hotels of the company, the Boston location first operating hotel has succeeded to distinguish itself and became the benchmark of the future openings of the brand. [...]
[...] Service Marketing: Concepts and Practices, pp. 185. [Accessed on 9 February 2018] Available from: https://books.google.co.uk/books?id=ZAcf8BGvx5wC&pg=PA185&lpg=PA185&dq =simon+cooper+ritz+set+trends&source=bl&ots=muDcSd0Lx7&sig=H3mUqkCI2H_ lNzBHIMz_VXvNGPw&hl=en&sa=X&ved=0ahUKEwi3s5GspY_ZAhXlJ8AKHaAd DlsQ6AEIQjAJ#v=onepage&q&f=false Kapoor, R., Paul, J., Halder, B. (2011b). Service Marketing: Concepts and Practices, pp. 184. [Accessed on 9 February 2018] Available from: https://books.google.co.uk/books?id=ZAcf8BGvx5wC&pg=PA185&lpg=PA185&dq =simon+cooper+ritz+set+trends&source=bl&ots=muDcSd0Lx7&sig=H3mUqkCI2H_ lNzBHIMz_VXvNGPw&hl=en&sa=X&ved=0ahUKEwi3s5GspY_ZAhXlJ8AKHaAd DlsQ6AEIQjAJ#v=onepage&q&f=false Marriott Careers (2018). [Accessed on 9 February 2018] Available from: http://www.careers.marriott.com Marriott Financial Report (2016). Pp 30-43. [Accessed on 12 February 2018] Available from: http://files.shareholder.com/downloads/MAR/5985261683x0x936409/834E45D98979-4190-AE47-702FBFF54755/Marriott_2016_Annual_Report.pdf Mintzberg, H. [...]
[...] On another side, this communication on the strategic plans should be performed at a global level to all employees of the group. This communication would benefit the company as it gives to the employees a global vision of the group strategy which allows them to behave and integrate the company's points of attention and interest. What is more, on a pure managerial aspect, as those hotels exist in very different location, this global communication strategy would allow the company's culture to develop and to maintain a certain consistency even though the distance between the branches is important and as a consequence, the external contingencies may vary (Lawrence et Lorsh). [...]
[...] This will also ensure the relation between the company and young people from rich families and ensure a long term relation with those present and future clients. The implementation of a strategic plan containing those objectives and methods should not face too many difficulties. However, a series of elements need to be addressed in order to avoid operational and image risks especially in terms of safety for the clients. INTRODUCTION According to an authoritative source (Cambridge Dictionary), strategy is defining a plan to find a way to achieve success. [...]
[...] They fulfil their function in the strategy of the group. In fact, they offer their services to new clients with financial capacity. By doing so and by being implemented strongly on those countries, they develop new capacities and a better understanding of clients depending on their culture, religion and age. This information gathered thanks to experience is extremely important for the future of the company as the clientele from emerging countries is strongly increasing since the end of the years 2010 and already represent the most important part of the client target for hotels with that level of standing. [...]
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