The aim of this report is to identify the importance of social media and mobile technology in terms of hospitality industry. Increased globalisation has enabled the business organisations to experience and enjoy greater benefits of their international market. Business expansion in multiple countries enabled the business organisations to explore new markets and offer their products to new target customers. Globalisation facilitating in connecting the market and make it accessible for the distant business organisation to enjoy the market. In other words, Liu et al (2014) put forwards the effect of globalisation as opportunity for business organisation for their international expansion that in turn increased the competition. An organisation in a particular industry now not only has to think of its local competitors, but also their international competitors that are offering their products in the target market. This competition is again increased with the increased advancement of technological equipment. The companies can now integrate modern technology in their business operation for proposing greater value to their customers and differentiate their products from the competitors. Integration of technology in case of marketing is common around industries and the companies belonging from all level are now integrating them for the promotion of their products or services and building customer relationship. Common technological adaptation in the business organisations in contemporary environment is the digital channels that include social media and mobile technology. Organisations over industries are now using social media and social networks for communicating their business and their products to their international target customers (Scott 2015). A customer now avail information of the desired products and their benefits from anywhere due to the advancement of mobile technology. Hence, according to Leung et al (2013), this has become necessary for the organisations not only to integrate social media and mobile technology in their business strategy, but also to develop proper strategy to differentiate their operation form other similar organisation offering similar products or services.
Hospitality industry on the other hand is a service industry that requires more attention from the international customers compared to other industries operating in the market. This is due to the need of the industry to accommodate international customers. This creates the need of incorporation of social media and advanced mobile technology to communicate their products to the international target customers. This can be considered as the primary medium of marketing products as the traditional marketing mediums have a geographical restriction. This can be considered as the primary benefit incorporating social media and mobile technology in the business strategy, as it has no geographical restriction and can communicate quality content to its target customers. Hence, the report will evaluate the social media strategy of Rest Up Hostel Driscoll House, which is a repute hostel in the area. The report will critically evaluate integration of social media marketing and mobile marketing in the organisation and the limitations the company faces. It will further provide recommendation for developing social media strategy for improving their business in the international market.
Marketing as put forward by Armstrong et al (2015) is the promotion and selling of the products and services offered by a business organisation. It is the process of communicating the products and services to the target market. The authors further argued that marketing is a complex process of market analysis, target identification, need identification, product pricing and promotion of the product, which is synchronised with the objective of the company. Marketing strategy as defined by Leonidou et al (2013) is the skeleton of a business that ensures business success. This involves market analysis using various marketing tools and placing the product accordingly to the results identified from the analysis. Market analysis involves segmentation of the target market, target identification that requires the products and services developed by the organisation and communication of the products and services to the identified target customers in the market segment. Armstrong et al (2015) identified a number of steps involved in the marketing process that ensures the success of marketing in a business that are market analysis, competitor analysis, company analysis, customer analysis, product analysis and communication. Market analysis is the study of target market and the external factors controlling the same, which can be studied using PESTLE. This is the macro environmental analysis. West, Ford and Ibrahim (2015) on the other hand defined competitor analysis as another macro environmental analysis that identifies the competitors and compare their sales and marketing that might prove as challenge in marketing the company’s products. Customer identification is the strategy incorporated for targeting customers in the target market defending on the need of the products being delivered by the company. This involves the identification of the existing customers and potential customers in the target market. Product analysis is the process of aligning the products according to the price and quality requirement of the target customer segment in the market. This ensures the brand value of the company and increases the chances of customer loyalty. The last and most vital part of marketing as defined by Yu (2013) is the communication or promotion of the products to the target customers. This involves various marketing strategy such as advertising, PR, word of mouth, sales promotion etc. depending on the analysis made earlier.
Contemporary advancement in technological and incorporation of social media and mobile technology in daily lives of the population increased the tension in the competition. Killian and McManus (2015) argued that social media and mobile technology are highly integrated in the marketing of any business organisation, which determine the success of marketing and the overall success of the organisations. The authors further argued about the benefits of digital marketing, which provides the organisation to explore greater opportunity in the marketing process. Hence, compatibility in the social media marketing in contemporary marketing ensures the success of business by enabling them to build greater customer relation. He, Zha and Li (2013) on the other hand specified the usage and benefits of social media in the business. According to the authors’ opinion, social media in a business can best be used as a tool for advertisement and sales promotion. The companies can advertise their content in the social media for promoting their products as well as communicate their offers to the customers. The authors further specified use of social media in market analysis, where an organisation not only gains opportunity to study their customers’ content by also the content developed and published by their competitors that enables them to take competitive steps for surviving in the competition.
Ström, Vendel and Bredican, (2014) on the other hand focuses on the incorporation of mobile technology in the marketing strategy. According to their findings, advanced technology developed in the mobile phones enables the customers to explore greater opportunity. The organisations on the other hand can exploit benefits of the technology and offer greater value to the customers. Mobile enables the customers to conduct precise search using the technologies like mobile specific applications, GPS, scanner, camera etc. This further enables them to enjoy easier purchase using the same technologies. For example, customers can locate products nearby using the GPS system incorporated in the mobile phones that ease their search for the products. Moreover, the scanner, camera and other applications in the mobile enables them to make purchase, make payment, and explore social media webpages. This requires the business organisations to incorporate the same in their business strategy to gain competitive advantage in the target market.
Recent shift of customer behaviour and integration of social media and mobile technology in their daily lives leaves the business organisations to rethink their marketing strategy and convert it in the digital domain for gaining greater attention. Tiago and Veríssimo (2014) in their study demonstrated both internal and external pressure on the business organisations for adapting social media and mobile technology. The contemporary market demands the social media presence of organisations over industries. The success of the business is currently depending on the integration of digital marketing usage of an organisation. The authors further argued about the improvement and involvement of the organisations in digital marketing for increasing public relation. Social media and mobile technologies enable the organisation to develop interaction based marketing strategy that helps in relationship building and brand value proposition.
Leeflang et al. (2014) on the other hand identified various challenges the organisations are facing in the process of digitalising business-marketing strategy. Though incorporation of social media and mobile technology in business strategies benefits the organisations, however it comes for a price of change in the overall organisation. The primary challenges business organisations over industries around the world is currently facing in digitalising their marketing strategies are talent gap, organisational design and actionable metrics. The authors argued that the business organisations require altering their organisational design, formulating actionable metrics and incorporating specific talents before implementing into digitalised marketing strategy. This is necessary to ensure success of the marketing strategy and to gain competitive advantage in the market.
Hays, Page and Buhalis (2013) argued on the utility of social media marketing in hospitality and tourism industry and pointed out the benefit of reach. According to the authors, implementation of social media in the marketing strategy of hospitality and tourism industry has increased their reach over the international customers, while maintaining tight budget. Due to the nature of the customers in the industry, it becomes necessary for the organisations operating in the industry to target customers from distant markets. Social media enables to reach out the distant markets for attracting the customers. Presence in social media and promotion of their services through the same platform enables them to gain customer attention. Moreover, public relation strategy using social media and sales promotion facilitates them in customer value proposition. Hudson and Thal (2013) on the other hand reflected on the other side of the coin and identified influence of social media in customer decision-making behaviour. As put forward by the authors, the content, reviews and comments are the primary information customers search for using social media before making their decision. Kim, Lim and Brymer (2015) further argued that the marketing managers are responsible for developing quality content maintaining transparency is necessary for effective social media marketing in hotel industry. Moreover, it is necessary for the team to track and respond to the negative comments from the customers to increase performance, as this activity will facilitate towards the customer value proposition.
Mo Kwon, Bae and Blum (2013) in their study focused on understanding the use of mobile application in viewing and availing hospitality services. The results reflected that the modern generation more adapted with the smartphones are confident in using mobile application and use it for availing the service, whereas, the population with less knowledge of smartphones utilise the facilities. The authors concluded that the increased technological advancement makes it necessary for the hospitality businesses to incorporate mobile technologies in their marketing considerations that will propose greater value to their customers and help them attracting greater number of customers in future. Kim et al. (2013) on the other hand focused on the motivation and satisfaction factors that forces the hospitality organisations in adopting mobile technology in their business. Their findings communicate that the time saving, mobility and fast and accurate applicability factors directs the customers to avail mobile services. Whereas Wang et al. (2015) argued on the adaptability of mobile hotel reservation system in the contemporary market. Their study reveals that there are a number of factors, which determines the use of mobile in hotel reservation. They are compatibility, technological competence, firm size and critical mass. It means that the significance of mobile reservation in greater in case of large firms satisfying the other mentioned factors for greater value proposition and gaining competitive advantage in the market. Their study also concludes that the necessity of incorporation of mobile technology in the small-scale hospitality organisation is limited due to the less need identified.
Rest Up London Driscoll House is a century old establishment built before the First World War. The establishment was initially built to accommodate women. However, Mr. Driscoll eventually bought the establishment and named it after his name. The organisation then operates as hotel for the travellers around the world. This is a fine destination for the international travellers where the customers receive quality rooms and standard service for comparatively cheaper price. The organisation offered around 200 rooms along with a various amenities for cheaper rate. However, the establishment started operating as the rest up hostel 2012 after the death of Mr. Driscoll in 2007 (restup.co.uk. 2018). Despite of included modernity, the establishment still holds some of the old elements of Driscoll house.
As mentioned in the earlier section, marketing strategy set by an organisation is of primary importance to attract customers by communicating the products offered. Hence, the organisation needs to focus on promotion of their marketing plan. Further discussed, incorporation of social media in the marketing strategy is another essential factor in the contemporary hospitality industry due to the requirement of accommodating international customers. Rest Up Hostel indeed has considered social media marketing in their marketing strategy. However, impact of social media marketing is less due to the focus and priority given by the organisation. Rest Up hostel Driscoll House have developed company web page by outsourcing the designing responsibility to Kota, which is a creative digital agency that designs company websites on contract. According to Katona (2014), outsourcing strategy adopted for designing company webpage is considered as effective business strategy that not only saves a serious amount of costing to the company, but also eases up the building process. Moreover, this can help company with expertise of hospitality in building quality webpage, which contributes in determining the attraction. For consideration, simplicity of a webpage contributes in customer satisfaction as they can both explore and purchase products online from the company webpage without facing complexity issues. However, Edelman and Brandi (2015) argued about the risk factors of outsourcing company webpage development as it gives the owner a little control over the design.
Social media presence as proposed by Leung, Bai and Stahura (2015) is important and it is necessary for the hospitality industry in addressing international customers. Rest Up Hostel Driscoll House, situated in London have little impact of social media presence. Though the company has enlisted themselves in the social networking websites like facebook and instagram, there is little to no activity performed by the organisation. According to the author, social networking can be utilised in various ways in business marketing using different marketing strategy. As commented by Okazaki and Taylor (2013), social media can be used incorporated in the company advertisement strategy. The company can communicate their products and services to the customers detailing about the features. Teck Weng and Cyril de Run (2013) on the other hand, focused more on sales promotion strategy, where the company can promote sales packages to their customers. The authors further argued on the public relation strategy integrating it with the social media, where the customers are facilitated with the review and rating opportunity. This helps in building customer relations and value proposition. Rest Up Hostel London fails to focus on social media promotion and gives it less priority in their promotional activity.
Third-party promotion on the other hand is incorporated by Rest Up Hostel, which can also be considered as the primary digital marketing strategy of the organisation. The company is associated with a number of third-party promotional organisations, which according to Smith, Baerlocher and DeWaal (2013) is platforms that enables the organisations in hospitality industry. This enables the organisations to promote their business through a third-party website. These organisations are responsible for accumulating the organisations in one single platform, enabling the customers to explore products and services offered by multiple hospitality organisations and to compare and decide best available product in the market. This also works as a PR as it enables the customer to share their experience. The company can be benefitted by analysing the accumulated data and utilise to modify their products according to the customer needs. Rest Up Hostel is associated with trivago and tripadvisor, which are the market leaders in the industry and have high customer visit rate.
Incorporation of mobile technology in hospitality industry on the other hand enables the organisation to offer their customers the opportunity to explore greater opportunity. This enables the company to offer their customer unique experience of purchasing products and services through the application developed for particularly the modern generation smartphones. This further facilitates the customers to provide feedback. These from the company perspective help in value proposition (Osterwalder et al. 2014). However, Rest Up yet to incorporate mobile technology in business strategy for carrying out their marketing activities.
Failure to adopt contemporary effective marketing strategy in their business has direct effect on their sales. The company, despite of having economy pricing strategy fails to build the potential customer base. This according to Osterwalder et al (2014), this is a result of failure in value proposition and ineffective promotion strategy implemented. The customer rating in tripadvisor.com (2018) reflects low rating with only three star. This reflects moderate demand of the customers due to the gap between expectation and experience, which can be mitigated with proper promotional strategy using social media by communicating information with the customers. Hence, this can be related to the marketing strategic failure of the company, which fails in communicating their products and services to the customers.
Failure in marketing strategy affects the overall business strategy, limiting its potential capability. The non-incorporation of social media and mobile technology in the business significantly reduces the opportunity of Rest Up Hostel. Incorporation of social media and mobile technology in marketing in contemporary business setup is essential due to the nature of customers and their demands. Business leaders of contemporary hospitality industry in the international level focus on the social media and its content for attracting customers and proposing value. As communicated earlier, the marketing strategy determines the success of overall business. Hence, the absence of proper social media presence and implementation of mobile technology is causing limitation of revenue generation in Rest Up Hostel.
The purpose served by the social media and mobile technology in marketing of hospitality products and services are increased revenue, lowered costs and improve customer services (Scott 2015). These are the primary goals commonly held by the organisations incorporating social media and mobile marketing in their business strategy. The promotion through social media and mobile technology potentially reduces the cost of marketing and further extending the reach and coverage of target population. Greater reach further ensures greater customer attraction. However, Rest Up Hostel Driscoll House in London fails to adopt social media or mobile marketing in their business strategy that reduces the customer range, which ultimately reduces the revenue generation. Malthouse et al (2013) further related this with the customer satisfaction for the products and services experienced by the organisation. The absence of social media or mobile technology in their marketing strategy considerably reduces the level of satisfaction perceived by the customers. Teck Weng and Cyril de Run (2013) attributed to the low level of interaction between the organisation and the customers. This restricts the limits of Rest Up in understanding customer needs. Interaction with the customer is one of the unique advantageous features of accessed by the organisations. Hence, it is possible to state that Rest Up Hostel fails to avail this unique opportunity of accessing this customer communication that ultimately reduces their understanding of the customer needs and decreases customer satisfaction. Results acquired form hosteller.com provides insight to similar outcomes with a rating of 7.5 out f ten that can be considered as average (hostelworld.com 2018). A number of adverse comments in the third-party website reflect intense level of dissatisfaction of the customer related to the communication service provided by the organisation. Results, when compared with other similar organisations in the area reflect greater satisfaction level for the companies utilising social media for their marketing.
Social media integration and development of mobile application for marketing process is cost effective for any business organisation. However, the requirement of the above is of absolute necessity in the contemporary market. Hence, it can be recommended for the organisation to adopt social networking strategy for advertising and PR activities, whereas, extending their reach to mobile technology through outsourcing. The company can outsource the mobile marketing to the third party marketing organisations for their mobile marketing activity. Third-party organisations in hospitality industry offer the customers a number of available options specific to their need. A third-party marketing organisation in hospitality provides the organisations a platform for promoting their products to the customers. For the customers on the other hand, this is a platform, where they can find multiple options for similar kind of products or services (Lu et al. 2013). Incorporation of this strategy will give the organisation a degree of exposure. This is because the customers prefer to search in the third-party application rather looking into individual company websites. This enables them to compare different organisations on a number of parameters namely price, quality, services offered, satisfactory level review by the visited customers etc. Hence, outsourcing mobile marketing to the third-party organisation will help the organisation holding their competitive advantage in the market, meanwhile reducing their operating cost in the field of marketing. This will help the organisation to offer their customer mobile reservation system, which will successfully attract greater number of customers towards the services offered.
Secondly, development of smartphone application can provide greater benefits to the company. The modern technologically advanced generation are accustomed with the smartphone applications and prefer to make purchase through the same. Hence, this will help the organisation in capturing greater customer attention due to the usability. This in turn will help in increasing the perceived satisfaction of the customers. Furthermore, the applications available in the playstore or istore enable the customers to rate and comment for the commodities purchased. This will help the organisation in increasing PR, as the marketing team of the organisation will gain access to establish direct or indirect communication with the customers (Scott 2015). The experiences shared by the customers will enable Rest Up to identify the issues present in the products and service and modify them accordingly to satisfy customer needs.
Third possible recommendation proposed for the organisation use of social media marketing for PR activity. PR activity or public relation activity is necessary for customer value creation, which enables the organisations to build communication with the customers. It is to hold the positive image of the organisation in the market and to highlight priority of the customers for the organisation (Thorson and Moore 2013). This will enable the customers to rate and review the experience gathered from the services availed. This will provide insight about the customers’ specific and common needs, which will further facilitate in modifying the services accordingly to the customers’ needs. The positive reviews will further help attracting greater customers towards the services offered by the organisation. However, the respond for the negative comments will help in representing the brand value and customer concern of the organisation. Moreover, this platform will enable the organisation to assist the customers through their search and provide the required information.
Lastly, the organisation can utilise social media as a platform to conduct their sales promotion to the customers. Sales promotion is the offering made by the company in their marketing process that benefit the customers to purchase the specific products over other similar products (Teck Weng and Cyril de Run 2013). The example of a sales promotion can be discount on the price of the product, extra benefits received on purchase, other product benefits offered on a purchase etc. This will help in luring the customers to gain the benefits specifically offered by the organisation. It will enable the organisation to reach out their target customers and offer packages. For example, the organisation can offer discount for direct purchase or they can offer service package to the customers. This will help attracting greater customers from both national and international market.
Conclusion
It is possible to conclude from the above discussion that social media and mobile technology in hospitality business is essential in marketing. Organisations operating within hospitality industry are enjoying social media marketing and mobile technology in their marketing process for both communicating their products to the customers as well as holding public relation by providing them opportunity to share their feedback with the organisation. Considerable investments are required in the field of social media marketing for gaining efficiency. Moreover, both the social media and mobile technology is possible to use with multiple marketing strategy for satisfying various marketing purposes of the organisation. It can bridge physical gap in the international market, as the potential clients of hospitality industry are the distant customers. Hence, the companies can gain benefit using social media and mobile marketing for communicating their products to the potential target customers as well as in value proposition. However, the case study conducted reflects marketing strategic failure. The Rest Up Hostel situated in London failed in incorporating social media and mobile marketing in their business, which restricts them in third-party promotion. This outsourcing strategy, despite of having its benefits is failing to produce benefit for the organisation. This is due to the incapability of the organisation in other section of social media marketing and absence of mobile marketing. Failure of this is reflected in the overall profit of the organisation as it fails in generate its potential revenue. However, the recommended modification in the marketing strategy incorporating social media marketing strategies and mobile marketing can help them gaining the level of revenue expected from the target customers. Moreover, this will help establishing their brand value by conducting PR activities as recommended above.
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