Report on Four Seasons Hotels and Resorts PDF

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Professor Harris...

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11/29/2019

FOUR SEASONS

Sumitpal Kaur SECTION- 6 8684012

Table of Contents Executive Summary..................................................................................................................................2 Introduction................................................................................................................................................ 3 Mission:..................................................................................................................................................3 Objective:............................................................................................................................................... 3 SWOT Analysis.........................................................................................................................................4 Strength:.................................................................................................................................................4 Weakness:.............................................................................................................................................4 Opportunities:........................................................................................................................................ 4 Threats:..................................................................................................................................................4 PESTLE Analysis......................................................................................................................................5 Political Factors:....................................................................................................................................5 Economic Factors:................................................................................................................................5 Social Factors:.......................................................................................................................................6 Technological Factors:.........................................................................................................................7 Environmental Factors:........................................................................................................................7 Legal Factors:........................................................................................................................................8 Market Segment........................................................................................................................................9 Product..................................................................................................................................................... 10 Marketing.................................................................................................................................................11 Conclusion & Recommendations..........................................................................................................12 References.............................................................................................................................................. 13

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Executive Summary This report analyzes an organization in hospitality industry who is somewhat similar in nature. The purpose of this analysis is to learn about the strategies and marketing: Four Seasons Hotel. The topic in this analysis covers critical incidents of The Four Seasons hotel in the past and the comparison between the existing strategies as well as their future plans. This research shows the influence that marketing has on the success or failure of companies and how companies craft sustainable strategies that help them to retain their position in the market.[ CITATION fou192 \l 1033 ] Founder and chairman (Isadore Sharp)

President and Chief Executive (J. Allen smith)

President, Worldwide Hotel (Christian Clerc)

operations

President, Portfolio Management & owner relations (Michael A. Crawford) President, Hotel Operations – Asia Pacific (Rainer Stampfer)

President, Hotel Operations - Europe, Middle East, and Africa (Simon Casson)

President, Hotel Operations – Americas (Vince Parrotta)

Executive vice president, Global business development (Bart Carnahan) Executive Vice president & Chief Human resources officer (Edward (ED) A. Evans)

Executive vice president & chief financial officer (John Davison) Executive Vice President & chief marketing office (Peter Nowlan)

Executive Vice President, General Counsel, and Secretary (Sarah Cohen)

Finally, conclusion and recommendation will be made by analyzing all the aspects of the luxury hotel.

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Introduction Four Seasons Hotels is a privately-held company that owns and operates hotels, resorts, and residence clubs. Four Seasons are highly personalized company providing 24-hour service which is combined with authentic, elegant surroundings of the highest quality, demonstrating a home away from home appreciating the best with over more than 50 years. Four Seasons provides its customers with a year-round lap of luxury. As the company, has grown from a single hotel to 101 in 42 countries, their deeply instilled culture, personified by their employees, continues to get.[ CITATION Wik191 \l 1033 ]

Mission: ‘We have chosen to specialize within the hospitality industry by offering only experiences of exceptional quality’.

Objective: ‘To be recognized the company that manages the finest hotels, resorts, and residence clubs wherever they locate’. The Four Seasons Hotels and resorts opened its first hotel in 1961, which have developed from one motel started by Isadore sharp in downtown Toronto Canada, to 82 luxury hotel properties in 34 countries worldwide. The company manages 93 hotels and resorts in 38 countries across Asia, the Americas, Europe, Africa, and Oceania. Within a few years, the company’s portfolio also included 10 hotels across Canada, and its first US management contracts, in San Francisco and Chicago. [ CITATION fou191 \l 1033 ] The company’s growth strategy focuses on destinations & its importance to luxury travelers, focusing on outbound markets where establishing a local presence has helped to build brand awareness where they are already operating successfully and still want to increase the presence globally. J. Allen Smith, President and CEO of Four Seasons Hotels, and Resorts says they have a very targeted approach to growth, anchored in an absolute focus on the luxury hotel and residential space.[ CITATION hos11 \l 1033 ]

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SWOT Analysis Strength: • Global presence in diverse competitive market • Over a period, company has developed its portfolio by continually exploring • Making best use out of social media, engaging consumers with brand & indirectly promoting its legendary service through online

Weakness: • Could face problem in funding its growth • Being a private company, may face problem while raising capital and making decisions • Expensive brand with small target market segment

Opportunities: • Collaboration with company like Fort capital may help expand & improve company’s portfolio in Florida • Due to growth trend in Canadian market, might benefit due to its strong presence in same market

Threats: • Increasing competition, affecting company’s profitability as forcing situation to lower fees and prices • No financial flexibility, more capital to invest towards expansion & improvement enabling to complete more effectively • May be affected by increasing labor wage in Canadian market resulting into increased operational costs.[ CITATION Art84 \l 1033 ]

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PESTLE Analysis Political Factors: 

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Size of Government Budgets – both Local Governments and National Government – The government at both national level and local levels are running deficit budgets which is boosting growth in the short term but may lead to increase in inflation over medium term. The bond rating of national government is investment grade. Segregation of Political Responsibilities between Different Government Agencies – There are numerous government agencies which reduces the risk of overwhelming pressure by one agency. But on the flip side it does increases both time and cost of doing business and getting certifications and clearances. International Trade & Other Treaties – The country has a good record of adhering to international treaties it has done with various global partners. The government of each party has adhered to the treaties done by previous governments, so there is a consistency in both rule of law and regulations. Role of Non-Government Organization, Civil Society & Protest Groups – The country has a vibrant civil society community and Seasons Hate should build bridges with them and seek out areas of co-operations. Civil society groups are influential not only in policy making but also in building a society wide narrative. Judiciary Independence – In the matter of commercial and business decisions, judiciary of the country is independent to a large extent. Business do face problem when the conflict is between public interest and proprietary technology similar to ruling in South Africa where government & judiciary allowed generic AIDS drug irrespective of patents of global companies. Regulatory Practices - The regulatory practices are streamlined with global norms which have helped the country to improve its “ease of doing business” ranking. Threat of Terrorist Attacks – We believe in the world of post 9/11, corporations such as Seasons Hate have to live with operating under the shadow of a terrorist attack. The prudent policy should be to take insurance and other types of hedging instruments to mitigate the losses occurring because of the terrorist attacks. Unrest within the Country & Chances of Civil Unrest – We don’t think that Seasons Hate business operations are facing any dangers from any kind of civil unrest or internal militant operations in the country.

Economic Factors: 

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Demand Shifts from Goods Economy to Service Economy – The share of services in the economy is constantly increasing compare to the share of manufacturing, goods, and agriculture sector. Consumer Disposable Income – The household income of the country has increased constantly in the last decade and half, compare to the USA market where household income is still below 2007 levels and not increased in real terms since early 1980’s. Seasons Hate can leverage this trend to expand the market beyond its traditional customers by employing a differentiated marketing campaign. Government Spending – As mentioned in the political factors, government of the country is running deficit budgets. The implication for Seasons Hate is that it can boost sales of its

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product in short run but also expose Seasons Hate to medium term forex and currency depreciation risks. Price Fluctuations in both Local and International Markets – Compare to the level of quantitative easing in last decade the prices of Seasons Hate products and prices of overall products have remained sticky in the US market. Seasons Hate should consider the fact that at deficit levels of United States in an emerging economy can lead to rampant inflation and serious risks of currency depreciation. Financial Market Structure and Availability of Capital at Reasonable Rates – The quantitative easing policy of Federal Reserve has led to liquidity flooding all across the global financial markets. Seasons Hate can borrow cheaply under such circumstances. But this strategy entails risks when interest rate will go up. GDP Trend & Rate of Economic Growth – The higher GDP growth rate signals growing demand in the economy. Seasons Hate can leverage this trend by expanding its product range and targeting new customers. One way to start is by closely mapping the changes in – consumer buying behavior and emerging value proposition. Inequality Index / Ranking on Gini Index – Gini Index and level of inequality are a great barometer for harmony and development of a society. If there is huge income inequality in the society then the likelihood of conflict and crime increases. It can lead to uncertainty and suppression of consumption in both short term and long term.

Social Factors: 

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Power Structure in Society – Seasons Hate should carefully analyze both. For example, the power structure in US economy is slowly moving towards the older generation as that generation has higher disposable income compare to the younger generation. Societal Norms and Hierarchy – What sort of hierarchy and norms are acceptable in society also influence the types and level of consumption in a society. In highly hierarchical societies the power of decision making often reside at the top. Types of Immigration & Attitude towards Immigrants – Given the latest developments such as Brexit and Immigrant detention on Southern border of United States. Attitude towards immigration has come under sharp focus. Seasons Hate should have capabilities to navigate under this hyper sensitive environment. Demographic Trend – The demographic trend is one of the key factors in demand forecasting of an economy. For example, as the population of USA and EU is growing old the demand for products mostly catering to this segment will grow. Seasons Hate should consider demographic trends before new product developments and integrate features that cater to this segment. As population is ageing it will require less tech intensive products. Nature of Social Contract between Government & Society – Before entering into a market Seasons Hate needs to understand the nature of social contract between government and society. For example, it has been extremely difficult for US companies to enter UK health market as UK health system is a nationalized system and everything goes through contracts at national level. Immigration Policies and Level of Immigration – What are the immigration policies of the country, what is the level of immigration, and in which sectors immigration is encouraged. This will enable the Seasons Hate to determine – if required can it hire talent globally to work in that particular market. Attitude towards Authority – Various cultures in different part of the world have different attitude towards authority. In Asia authority is respected while in west it is something to rebel

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against. Seasons Hate should carefully analyze the attitude towards authority before launching a marketing campaign for its products and services. Birth Rate – Birth rate is also a good indicator of future demand. USA has avoided the European Union style stagnant economy on the back of slightly higher birth rate and higher level of immigration.

Technological Factors: 

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Preparedness for 5G Related Infrastructure – Countries across the world are trying to prepare themselves to install 5G infrastructure. Seasons Hate should assess to what level the local market is prepared to roll out the 5G connectivity. Level of Acceptance of Technology in the Society – Seasons Hate has to figure out the level of technology acceptance in the society before launching new products. Often companies enter the arena without requisite infrastructure to support the technology-oriented model. E-Commerce & Related Infrastructure Development – As E-Commerce is critical for Seasons Hate business model. It should evaluate the e-commerce infrastructure, technology infrastructure etc. before entering a new market. Mobile Phone & Internet Penetration – Seasons Hate should assess the level of internet and mobile phone penetration in the country as it will it in building a requisite business model based on local needs and realities. Empowerment of Supply Chain Partners – Seasons Hate should analyze areas where technology can empower supply chain partners. This can help Seasons Hate to bring in more transparency and make supply chain more flexible. Likelihood of Technology Disruption – If the country is hub of technology companies then there is a high chance of technology disruption among various industries. Seasons Hate has to assess whether it can live with the fast pace of technology disruption in its industry. Intellectual Property Rights and Patents Protection – Before entering new market Seasons Hate should focus on the environment for intellectual property rights. Acceptance of Mobile Payments and Fintech Services – One of the areas where US are lacking behind China is Mobile Payments. Seasons Hate should assess what are preferred choice of mobile payments in local economy and chose the business model based on it.

Environmental Factors: 

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Environmental Standards and Regulations both at National & Local Levels – Often the environment policy at national and local level can be different. This can help Seasons Hate in numerous decisions such as plant location, product development, and pricing strategy. Waste Management – What is the policy of waste management in the prospective market and how Seasons Hate can adhere to the waste management requirements in that market. Recycle Policies – What are the recycle policies in prospective market and how Seasons Hate can adhere to those policies. Focus & Spending on Renewable Technologies – How much of the budget is spend on renewable energy sources and how Seasons Hate can make this investment as part of its competitive strategy. Influence and Effectiveness of Environmental Agencies – The role of environment standards enforcement agencies is critical in safeguarding norms. But often in emerging countries these agencies delay the process as a tactic to extract bribes. Seasons Hate should be aware of presence of such practices in a country. Environmental Regulation Impacting Absolute Cost Advantage Dynamics in the Industry.

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Corporate Social Responsibilities Culture – Are Seasons Hate present CSR efforts applicable in the new market or does it need to have new initiative to cater to the prospective market.

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Consumer Protection Laws – Seasons Hate needs to know what are the consumer laws, what is the rate of enforcement, what is the attitude of authorities towards consumer protection laws, and what is the role activist groups in enforcement of consumer protection laws. Laws regarding Monopoly and Restrictive Trade Practices – As a new player Seasons Hate shouldn’t be worried about the monopoly and restrictive trade practices law. Transparency in Judiciary System & Processes – Transparency is essential for fair and consistent decision making. If the process is consistent and transparent then Seasons Hate can plan ahead with greater conviction. Employment Laws – What are the employment laws in the country and are they consistent with the business model of Seasons Hate. For example, Uber employment system is not consistent with French laws and it is facing challenges in the country. Intellectual Property Rights Protection – Seasons Hate should assess the level of protection that intellectual property rights get under the legal system of the country. Data Protection Laws – Seasons Hate needs to assess what are the data laws in the country and what it needs to do to comply with them. For example, most of EU countries now want the EU citizen data to be saved in EU countries only. Business Laws – Before entering into new market – Seasons Hate has to assess what are the business laws and h...