X-Axis – Differentiation (need 3 or more cited justification points)

 

Analyzed by examining:

  • Consumer perceptions of uniqueness

 

  • Customer satisfaction

 

  • R&D budget for new product development

 

  1. In 2017, Marriott International was chosen by Fast Company as one of the World’s 50 Most Innovative Companies.
  2. Marriott legacy brands earns an average of 13% revenue-per-available-room premium over competitor hotels in the same markets.
  3. In 2016, Marriott International had 100 million loyalty members. Its competition had the following numbers:
    1. Intercontinental Hotels Group had 98 million members.

 

  1. Hilton Worldwide had 60 million members.
  2. AccorHotels had 31 million members.

 

  1. Choice Hotels International had 30 million members.

 

  1. La Quinta had 13 million members.

 

  1. Hyatt had 22 million members.
  2. At the end of 2016, Marriot was the world’s largest hotelier. In the U.S., there were 55,000 hotels with 5 million rooms. Marriott operated a total of 14%. Its competitors operated the following (Farronato and Pisano)

 

  1. Hilton- 12%

 

  1. Wyndham- 8%

 

  1. Choice Hotels International- 8%
  2. IHG- 8%

 

  1. Marriott had the largest share of hotel rooms in 2017 for both worldwide and U.S., at roughly 0.07 million and 0.15 million, respectively.
  2. In 2018, Marriott earned 20.76 billion in revenue, more than double of its top competitor, Hilton, who earned 8.9 billion that same year. (“Marriott International: Revenue 1999-2018 | Statista”)
  3. Marriot’s 30 brands that collectively make Marriott Bonvoy the leading loyalty program in travel are each distinctly positioned and together provide a range of experiences, locations, and price points for our customers (Marriott International, 2020).

 

  1. Marriott’s commitment in development and expansion of new units is another significant piece that differentiates them from competitors (Marriott International, 2020).
  2. In 2019, their development team approved for 815 additional properties with a record 136,000 rooms, pushing their absolute worldwide pipeline to roughly 515,000 rooms at year end 2019 for the first time in our organization’s history (Marriott International, 2020).

 

Y-Axis – Niche Market – (need 3 or more cited justification points)

 

Analyzed by examining:

  • Income statement – % of revenues

 

  • Focus of marketing budget

 

  1. For 2019, Marriott reported revenue at nearly $21B. Marriott’s loyalty members purchased more than 50% of the nightly rooms, marketing towards an expanding member base to generate revenue (Marriott International, 2020).

 

  1. At the end of 2019 more than half of Marriott’s rooms were located outside of North America; Asia Pacific, Europe, Caribbean and Latin America, and Middle and East Africa. With 57% within North America and 81% outside North America in fee revenues (Marriott International, 2020).
  2. Marriott’s portfolio includes brands in different areas of the market, ranging from; luxury to economy (Farronato et al., 2018).
  3. Annual reports of 2018 reported a net income of $20.76 billion. On an average, 80% of Marriott’s customers are Business professionals (Both individual and group travelers) Revenue breakdown by target market segmentation:

 

  1. 40% – Business travel

 

  1. 40% – Group travel

 

  1. 20% – Leisure travel
  2. Marriott’s market segmentation is based on slightly different needs of customers. Marriott Hotels & Resorts targets its services through hotel brands that provide various price points and service levels to customers of varying economic backgrounds.

 

  1. The 31 brands of the company are displayed in their entirety on the website of Marriott International with a segmentation into two main categories and three levels of sophistication. For both brands, a long effort to distinguish has been undertaken to justify their place on the table.

 

  1. Since the merger, the cumulative number of loyalty programs exceeded 100 million, up from 54 million in 2015. Customer Satisfaction score is 80 out of 100 (ACSI – It is an economic indicator used to measure the satisfaction of consumers across the U.S. economy and various industries.)
  2. Marriott Hotels and Resorts is a key player in the upper scale category. With the Starwood strategic merger, it has positioned as a cost leader in the market compared to its competitors for the services they offer. It has gained huge customer loyalty and positioned as innovator in the hospitality segment. It mostly lies in the Q4(Appendix 1) as it has cost effective offerings and great customer base.

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