Phase 2 Company Analysis PDF

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Company Analysis: Best Western Prepared for: Professor Deswal Prepared by: Arjun Kohli

A. Company Background

History Founded in 1946 (Right after World War II) by David Guertin, whose known as “Mr. Hotel” throughout the industry (Revfine, 2018). In 1960 the requirements for Best Western membership were set as to be the "best" or "as good as the best" property, where they also developed and initiated the "Referral system". Best Western’s name originated from the notion that the majority of the chain's operations were located west of the Mississippi River in the United States (Revfine, 2018). Best Western developed the only hospitality reservations service in 1962 which lapped all over America, and in 1963 Best Western Identified as the largest motel brand in the industry with a total of 699 properties (Revfine, 2018). In 1964, when Canadian hotel owners joined the system, Best Western took the first step toward global expansion

Size and Growth Best Western owns over 4,000 hotels located in nearly 100 countries worldwide and is an iconic known brand that is easily recognized by its name and logo. They are clearly one of the leading hotel chains in the world. Guests have the option of selecting from 16 unique hotel brands presented by Best Western. Along with 4,000 hotels, Best Western offers hotel stays, dining services, spa, gym, leisure rooms, food & drinks, and entertainment all as a part of its services (Revfine, 2018). Best Western is known to have earned a revenue of 6 billion dollars (Kostuch, 2018). Best Western held a strong position at number 9 of strongest Canadian Hotels with $600.9 million, a $62.3 million jump from 2018 a $50.9-million jump from 2016 for its portfolio of 28 Canadian hotels (Kostuch, 2018). The company has expanded to 11 brands over the last two years, with the recent introduction of a second soft brand, BW Signature Collection.They are constantly building and growing more locations which can easily be accessible by consumers (Kostuch, 2018).

B: Segmentation Chart The following chart outlines two customer segments for Best Western:

Segments

Typical Room Stay-In

Company Event Hosting/ Group Stay-In (Wedding etc)

Demographic

● All Ages ● Typically Single, Couples or Family Stay ● Male and Females ● Medium to High Level Income

● Typically Employers and current workers ● Groups of people involved in the company/ celebration get together ● Male and Female ● Typically high personal, or company spending income

Geographic

● America, Canada, Mexico, Europe etc. Any area which has a Best Western location

● America, Canada, Mexico, Europe etc. Any area which has a Best Western location

Physiographic

● Need a place to stay, sleep and spend the night ● On vacation, roadtrip, work-related, family reason travelling, stuck in an area ● Value a pool, gym area, spa, leisure room, good service ● Prefer hotel stays over AirBnB, Motels

● Require a certain sized meeting or party room, certain accommodations depends on the quantity of workers ● Pricing discount adjust for company, amount of consumers ● Need a place to hold conference, party, work related trip stay

Behavioural

● Enjoy picking hotels for stay-in nights ● Typically stay loyal to the same hotel they are comfortable with when applicable ● Want specific type of room/accommodation

● Enjoy hosting events at hotels (Easy, convenient,spacious) ● Prioritize booking events, long term benefit to the company ● Incentivized by many services provided for the group

The primary segment for Best Western is the typical single, couples or family room reservation stays. These occur daily around the clock due to multiple reasons which affect many people everyday and help result them into planning a stay at the Best Western.These people typically will always look for a hotel as the first option of stay

(Over AirBnB, motels, short-term renting) throughout their life. Although the second option may have a high volume too, they are occasional planned events and aren’t guaranteed to sustain daily the level of the first option. C: 4 P’s Product: Best Western is regarded as one of the leading hotel chains in the world. As I stated, they offer Hotels, Resorts and a variety of other resources. Best Western has more than 4000 hotels offering hotel stays, dining services, spa, gym, leisure rooms, food & drinks, and entertainment all as a part of its services (Best Western, 2017). The current Model is based off the idea that anyone can own a Best Western franchise and provide the products and services offered by the company (Best Western, 2017). "The Mission of Best Western is to enhance brand quality and increase member value” (Best Western, 2017). Best Ten Unique Hotel Brands Western Offered by BW

Best Western Plus

Best Western Premier

Executive Residency by Best Western

BW Signature Collection

GLo

Sadie

Aiden

BW Premier Vib Collection Amenities Offered

Food & Drink

In-Room

Centers

Other

Complimentary Breakfast

In-room Mini Refrigerator

Fitness Center

Free Wi-Fi

Bar offering drinks

In-room work desk

Business Center

Stylish Bathroom Amenities

Restaurant

In-room coffee

Pool Center

On-site Guest Laundry

Price: ● Price varies depending on location and selection of room ● Best Western exercises “Value assurance” procedures for their services (Best Western, 2017)

● The costs of Best Western lodgings have been set to fit the focused-on clients while maintaining their nature of administration (Kostuch, 2018) ● Could range from $100 to $500 a room per night depending on various variables (Best Western, 2017) Promotion ● Many different methods of promotion & advertising methods ● TV, newspapers, magazines, online ads ● Hosts several events, conferences, travel shows for both employees and loyal consumers (Best Western, 2017) ● Promotion through online travel agencies (Best Western Developers, 2018) ● They believe in keeping the name of the brand consistently out there so it can continue to be in the minds of the public (Higher chance of being chosen)

Place: ● ● ● ●

Headquartered in Phoenix, Arizona (Best Western, 2017) 4,195 Hotels worldwide in nearly 100 different countries (Best Western, 2017) Majority of hotels reside in the United States Consistently building and growing more locations which can easily be accessible by consumers (Best Western Developers, 2018) ● Below is an example of a map in Germany pinpointing Best Western locations:

D: Competitive Advantage ● ● ● ● ●

A brand with strong recognition Adventurous options for tourists Quality of Services Employment turnover Best Westerns company has a foundation as one of the first modest hotels and evolutionized the hotel experience.The company has made its mark on a short list of the leading international luxury hotel brands. It consistently shows a positive steady growth despite stiff competition due to its “Innovative differentiation strategy” and unique “Best Western Rewards Program” (MBASkool, 2011)

E: SWOT Analysis Below is the SWOT Analysis (MBASkool, 2011) Strengths

Weaknesses

1. Owns hotels in over 80 countries, over 4100 hotels 2. One of the World’s Largest Hotel Chains 3. Hotels present their own identity and flair along with International level services that they have to incorporate in their offerings as a Best Western member 4. Located in highly developed solid property areas across the world 5. Best Western Travel Card has been successful in increasing sales and gaining customers to repeatedly visit back (Customer loyalty)

1. Quality control becomes an issue at times with and limited accountability because Best Western does not interfere with management of member hotels

Opportunities

Threats

2. Limited market share growth due to competition from international hotel chains

1. Digitalization and more online presence 1. Big chains are entering new markets 2. The economic conditions will improve 2. Changing market conditions, a possible occupancy rates in the mid-market down economy segments 3. Higher rate of penetration in economies which are emerging

F. Potential Actions 1. BUILD ON A STRENGTH Continue to build, expand and open new locations around the world causing your brand to continually grow around the world and become stronger annually. 2. CORRECT/MINIMIZE A WEAKNESS Start creating a process to possibly positively interfere and performance evaluate the member hotels owned by Best Western to limit the issue of quality control.

3. EXPLOIT AN OPPORTUNITY Start having a higher online presence by getting more involved with social media, increasing posts, higher quality presence, communicating with employees more, creating bulletin boards which consumers can visit for feedback and to gain incentives, marketing more on different websites, sponsoring.

4. EXPLOIT AN OPPORTUNITY In countries where the economies are booming and the industry is obtaining high levels of success, ensure that your brand involves a higher rate of penetration in those economies to obtain maximum success. 5. MANAGE A THREAT Ensure that your brand is ahead of the curb when it comes to marketing promotion, quality, service, price for product/service, accommodations etc. to help combat possible threats of new big chains entering the same industry. 6. MANAGE A THREAT Create a backup plan of executions just incase of an unforeseen (Now foreseen) economic crash and market decline, these situations are hard to see coming and the majority of the time unavoidable so the best option you can have is to have a plan and be ready to minimize the negative impact of this crash.

REFERENCE LIST REVFINE 30, U. A., 8, karan patel N., 19, T. N., & 20, E. A. N. (2018, November 11). 10 Essential Hotel Marketing Strategies to Gain more Bookings. Retrieved October 27, 2019, from https://www.revfine.com/hotel-marketing-strategies/. KOSTUCH Kostuch Media Ltd., & Kostuch Media Ltd. (2018, October 25). The Top 50 Report: The Canadian Hotel Industry Continues to Thrive. Retrieved October 30, 2019, from https://www.hoteliermagazine.com/the-top-50-report-the-canadian-hotel-industrycontinues-to-thrive/. BESTWESTERN DEVELOPERS Ten unique hotel brands for every type of developer and market. (n.d.). Retrieved October 26, 2019, from https://www.bestwesterndevelopers.com/portfolio/. BEST WESTERN Wherever Life Takes You, Best Western Is There.®. (n.d.). Retrieved October 29, 2019, from https://www.bestwestern.com/en_US/hotels/discover-bestwestern/brands/best-western-plus.html. MBASKOOL Zigu. (n.d.). Best Western SWOT Analysis: Top Best Western Competitors & USP: Brand Analysis. Retrieved October 26, 2019, from

https://www.mbaskool.com/brandguide/tourism-and-hospitality/2896-best-western.html....