As the technology is enhancing communication, transportation, and financial flows, the world continues to feel smaller. It is possible for the organizations to conduct business in any country around the world. In this report, international marketing strategy plan of Radisson Blu hotel has been discussed. The hotel is planning to expand and establish more in the Netherlands. The international marketing is the simple application of marketing principles in more than one country. It undertakes marketing activities in more than one country. Radisson hotel is an international chain of hotels. It was sounded in 1909 and having headquartered at Minnetonka, Minnesota, the U.S. The Radisson hotel is one of the largest groups of hotels with 8 unique brands. It includes Radisson Blu, Radisson, Radisson RED, Park Inn, Park Plaza, Country Inn & Suites and Prizeotel. This report includes a situational analysis which comprises micro and macro environmental analysis. The specific geographic international market has been appraised. Further, the market entry strategy has been discussed along with the barriers to entry. The cost-effectiveness of the methods of sales promotion has been defined along with the focus on the segments to be reached. Finally, the market mix has been recommended ensuring significance to the target audience.
The situational analysis is used to analyze the internal and external environment in order to understand the capability of the organization, customers, and the business environment. It can help Radisson hotel to communicate the benefits of it’s services to the needs of potential customers.
These factors are beyond the control of the environment and influence the decisions of the hotel. The microenvironmental analysis includes the following factors:
It is important for the Radisson Blu to identify the existing and new competitors of hotels in the Netherlands in order to make expansion in the market. The existing market share of competitors can threaten the market efforts of Radisson Blu. The hotel could bring additional production capacity. It makes existing hotels to be more efficient and learn to compete on new dimensions. The absence of entry barriers in the Netherlands increases the profitability of the hotel that they earn more profits.
It describes the intensity of competition between the existing hotels in the industry of Netherlands. The high competitive pressure results in the heaviness of prices, margins and for profitability for every hotel in the industry (Bird, Westcott & Thiesen, 2018). The major players in the hotel chain industry are Best western plus, Van der Valk Hotel DE Bilt, Eden Hotel and more. The ranking of Radisson Blu has been defined in the Appendices 2.
The bargaining power in the hotel’s industry is dominated by a few suppliers than a fragmented source of supply. There are no substitutes in the Netherlands for the particular input. The bargaining power of suppliers’ customers is low due to fragmentation (Sun, Paswan & Tieslau, 2016). The switching cost from one supplier to another is also very high.
The bargaining power of the customers is likely to be very high. The customers book rooms so the concentration is on the guests. The supplying industry includes a large number of small operators. The supplying industry operates with high fixed costs (Steenkamp, 2017). There are high switching costs for the guests.
The threat of substitute exists for the Radisson Blu as there are alternative options with lower prices of performance parameters. This factor also links to the complimentary services. The threat of substitutes is determined by the factors like brand loyalty of customers, strong customer relationships, switching costs, current trends and more (Felzensztein, Stringer, Benson-Rea & Freeman, 2014).
Political and legal forces
The Netherlands has a stable political system as it functions by a monarchy. There is a good scope for Radisson to expand it’s operations in the Netherlands as the government promotes foreign direct investment. As a result, more job opportunities can be created and income can be increased. The rules and regulations of the country allow people to have freedom cooperates hotels to conduct operations of hotel smoothly. Radisson needs to be alert as there is Dutch legislation to protect the foreign investors. The sound marketing strategy always undertakes the political and legal developments related to the organization.
Demographic forces
The demographic forces include the forces such as religion, age, civilization, education level, culture and household lifestyle. The anticipated population growth is high as compared to the international standards which create more opportunity for the expansion of services by Radisson Blu. The labor force of the country represents the graduates of universities and training institutes specialized in technology and economics.
Economic factors
The economic environment impacts the decision of both the hotel and the consumer’s decision-making process. There are plenty of international hotels in the Netherlands which makes the demand for labor increase. The surplus of proper infrastructure in the country enables Radisson to expand and establish it’s operations. The skilled labor can help Radisson to run it’s business in the Netherlands.
Natural forces
There are plenty of natural resources which are an attraction for the travelers and add-on for the hotels. The awareness is also increasing on the environmental issues in the Netherlands. The living standard in the rural area is low. It is an advantage to engage with the consumers directly and build awareness.
Technological factors
There is the accessibility of the internet in the Netherlands which makes convenient for the guests to make bookings. There are fewer innovations in the hotel industry which is a greater advantage for the Radisson to expand it’s operations in Netherland. The social and digital technology is the effective tool to reach customers (Šimi?evi? & Šteti?, 2015). The foreign companies have been invited to contribute to the transformation of the country.
Social and cultural factors
There is a high level of income for the middle class in the Netherlands. They prefer to spend more. There is a fast-growing consumer market. The country is attracting international companies. The culture represents regional differences as well as foreign influences. It is the fast-growing economy.
The geographic location selected by Radisson Blu is Volendam in the North Holland for expanding operations. Volendam is known for it’s cultural and artistic heritage. The city is famous for it’s nightlife, architecture and walking. Volendam is one of the popular destinations. Volendam attracted 5.7 million international visitors in 2014 which was 10% more than the last year. As per the tourism policy, the number of tourists is expected to grow by 5% each year. So, the tourists who visit Volendam are required to stay in the hotels. In such a scenario, Radisson Blu can make improvement and expansion in the services by providing additional services (Roubi, 2015).
Radisson Blu can be established in the central part of Volendam. The Volendam is a great choice for the travelers. The hotel can also establish it’s branches in other parts of the Volendam as well. There is great scope for the hotel due to the growing number of travelers in the city. The hotel can also tie up with the traveling agencies as it can create more opportunity for the hotel (Palekhova, Ramanauskiene & Tamuliene, 2015). The hotel can provide the food as per the taste of travelers and the additional facilities required by them.
The number of hotels in the Netherlands is rapidly increasing. There were 2,370 hotels in the Netherlands from 2011-2016 (The Statistics Portal, 2016). There is a variety of options open to Radisson if it makes a decision to expand and establish in the Netherlands. The market entry strategies are discussed below:
Franchising
The franchising is one of the easiest ways to break new market of Netherlands. Radisson has to use it’s existing business model in the country. It can allow the hotel to open it’s branches or franchises. The franchises are liable to pay a certain amount and profits to the authority of the hotel.
Partnering up
A partner can find out in the foreign country who is well known to the hotel industry of Netherlands. Radisson can easily grip on the new market with the help of a partner. It is also helpful in knowing regulations and other requirements. The partnering is also a useful strategy in the markets, where the culture is different in both business and social terms (Adeola, Boso & Adeniji, 2018).
Joint ventures
It is a partnership between two companies. The companies link up and invest in a project of the hotel. The investment is usually made in the agreed proportion of 50/50 and the profits are also distributed accordingly. This strategy is beneficial in entering the hotel industry of the Netherlands.
The sales promotion for the international marketing includes advertising and pricing. The aim of sales promotions is to stimulate the potential customers through the short-term incentives. The cost-effective methods of sales promotion include various methods of the internet as given below:
Google Ads: There is no minimum amount to spend on the Google ads. The hotel is charged on per click or per impression basis. The advertisement is required to be specific and cost-effective in order to avoid competition.
Business website: It is essential for the businesses to maintain a business website. It is the effective advertisement method as it provides the details about the services of a hotel. The things required for setting up a website is a domain name and hosting company (De Mooij, 2015).
Facebook business page: A Facebook business page is a free source of advertising. The sources can be used to share information on the business. The hotel can put posts and stimulate discussion. The likes on the page of business increase the popularity of the hotel.
Facebook ads: The advertisement on the Facebook page is similar to the Google ads. It is a cost-effective method to spread information of a business to the target audience. The location, education, and interest of the audience are selected before deciding the holiday segment (Santini, et. al. 2015).
LinkedIn: LinkedIn helps the hotel to build network group which advertises the business and the expertise required. The hotel can get business through online recommendations. It is a helpful method for the Radisson Blu from the perspective of the business segment.
Email: The emails are the popular method for the business segment as cost-effective method of sales promotion. The emails include the updates of business and targets the potential customers. A monthly newsletter can also be sent (Choi & Yeniyurt, 2015).
Newspapers: It is the most common method of sales promotion. An article published in the newspaper can help the hotel to generate business partners and the customers who are interested in holidaying.
The marketing mix for the hotel industry is crucial for the success of the marketing efforts of Radisson. It includes the following aspects:
Service/ Facilities
It is considered at the initial level because without service, the hotels have nothing to deliver. Radisson offers guest rooms, food and beverages, health and wellness facilities, conference facilities and travel desk. The hotel is going to cater to different market segments and these segments have different requirements (Weismann, Buscaglia & Peterson, 2014). For instance, a leisure guest looks for the leisure and wellness facilities of the hotel. A traveler who is a businessman gives importance to the facilities like business center, video conferencing, internet connectivity and more.
Place and distribution
It states to the accessibility of the products to the consumers. If it is compared to other products normally, the hotel product does not travel to the customers but the customers come to the product or hotel (Javalgi & La Toya, 2015). The place or location of the Radisson Blu can be in the city, resorts area, hill station and outskirts. The hotels make use of the direct or indirect method to reach it’s potential customers. The direct methods are given below:
The indirect methods are:
Promotions
The sales and marketing director uses the most effective promotion and communication mix. The promotions are the best way to communicate with customers and it helps to target them. The promotional and communication channels used by the hotels are brochures, television channels, billboards, commercials, Facebook page and hotel website (Murphy, 2018).
Room rate or pricing
The appropriate pricing strategy is one of the critical aspects of the marketing mix. If the products of the hotels are not priced competitively then the customers can neglect the services of a hotel. The guests are strongly influenced by the packages offered by the hotels. The packages and prices are decided to keep in mind to appeal to customers (Kumar, Adlakha & Mukherjee, 2016). The hotels can charge high in the peak season from the customers.
Conclusion
The micro and macro environments have a significant impact on the success of marketing campaigns. The factors of these environments should be considered at the time of decision-making process. Thus, the situational analysis is helpful to the hotel in communicating the benefit of it’s services to the needs of potential customers. As per the surveys, Volendam is the most suitable geographic location in order to establish operations. The marketing strategies such as franchising, partnering up and joint ventures have been used as an expansion and establishments of it’s operations. The various cost-effective methods of sales promotion have been discussed for both holiday and business segment. Finally, the marketing mix has been defined in order to successfully conduct marketing efforts.
References
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