Elements of extended marking mix and product segmentation

This assignment sample will help you in doing assignments that require selecting an organisation and conducting research about some aspect of their supply chain and how it is managed. What you will find in this assignment sample is listed below:

Section 1

Select an organisation and conduct research about some aspect their supply chain and how it is managed. You can select a supply chain topic and research how this is applied in the “real world”. A comparison of theory and practice. Make sure you develop a supply chain ‘MAP’ as part of this research The research should be broad and should include a cross section of web sites, news articles, trade journals as well as academic journals. The report should be a business report with requisite headings. The report should be balanced with both favourable and unfavourable aspect of supply chain management. As the rubric suggests, 45% of marks are based on your research The approach is flexible and I would like you to focus on conducting research about something that you are interested in or some aspects that inspires you.

Introduction

Shangri-La Hotel is one of the premium hotel range which was founded in 1971 by Robert Kuok. Till the year 2002, the company expanded widely in the Asia-Pacific region. Later on it expanded to the other parts of the world. It is popularly known everywhere and serve the high end needs of the tourists who come for business and leisure purpose.
Justify and discuss the selection of two key microenvironment and two key macro-environment elements that are likely to affect the business referred to in this case.
Micro-environmental factors affects the working of a business and generally relate to the allocation and usage of the environmental resources which creates an impact on the other sections of the society (Brotherton, 2003). Thus understanding these factors in details helps organization in formulation of strategies for the achievement of the goals and objectives of the company. Some of the important micro-environmental factor which is affecting Shangri-La Hotel business are as follows:

Customers

Customers of any business entity determine the success of that business. Shangri-La Hotel provides great hospitality to its customers and strive to formulate strategies to create an organizational culture where the customers are considered as an important entity (Morrison, 2002). Thus understanding each type of customer, their needs, preferences, behaviour becomes important for the company. Thus Shangri-La Hotel which has originated in China has modified its employees training in accordance with the particular country’s needs (Richter, 2002). The hospitality requirement of the customers in China is different from that of Australia, Singapore, etc. Thus for each specific region of the world in which the company operates, the employees of that location need to undergo training in relation to language, cultural differences, etc. Thus knowing the customer is very important in order to manage this micro-environmental factor and formulate efficient marketing strategy.

Employees

Another important micro-environment factor that affect any business are the employees of the organization. Shangri-La Hotel, also has high value for its employees and manages this micro-environmental factor most effectively which has helped the company to be successful (Jauhari, 2008). The service of Shangri-La Hotel is delivered by the staff and the employees. Thus it’s important that these employees reflect the culture, motive and image of the company. When they provide service to its customers, it should be characterised by high level of hospitality and understanding for the customers. The company trains its staff and employees with the latest developments in the hospitality sector according to the needs of the specific region which help the company serve its customers successfully.
Macro-environmental factors are those factors which affects a business externally and helps to determine the marketing campaign which take care of these factors. Shangri-La Hotel which operates globally has to deal with varied degree of these factors affecting the business. However the two most important macro-environmental factors that affects its business are:

Social and Cultural Factor

These factors are very important for a company like Shangri-La Hotel, as the company deals with the hospitality service. As he customers who would receive the service and the employees who would provide the service are human beings with their own set of beliefs, behaviour, culture, social norms, it becomes important to construct a standard cultural and social norms (Chen, 2013). When the company is operating in Australian market, it needs to deal with the cultural and social norms of that country and train its staff accordingly. For example in the country like Australia, there were less humility among the people than in China or Hong Kong. Adapting to these changes is important for success of any organization.

Economic Factor

Economic factor is also an important macro-environmental factor which affects the business in terms of understanding the purchasing power of the people of that country, their level of income, their attitude towards spending and investment (Park,Seong-Kyu & Wu Peng, 2013). A country where the per capita income of the people are high would demand premium services like the one provided by Shangri-La Hotel. The interest rate, development rate, employment rate, etc. of a country becomes important for a company to determine the long term prospects in a specific country.

Section 2

Briefly describe how the market for the product category of the business referred to in this case might have been segmented by this business;
Shangri-La Hotel deals in the hospitality service where the market for such service are the people who are in need of such service. The market segmentation for the products in which Shangri- La Hotel deal with includes hotel services which provide relaxation, rejuvenation service to its customers (Saeed A. Mousa, 2016). It provides world class hospitality service with most of its room with ocean or sea view. As it is a luxury hotel, the customers would be high income travellers who would be travelling for business or leisure. Also the company would have multi-national corporates as customers. These corporates would need the hotel service for the senior business executive who travel for business purpose. As these hotel are located in the exotic destinations of the world, the high income families would choose this hotel for vacation.
As the hotel has a budget friendly variant, the market for such would be middle income people and business travellers. As the operations around the world is becoming more globalised, and the trend of reduction in air fare prices, there is an increasing demand for travelling around the world. Market segment of a hotel business would include dividing its customers based on their expectations from the hotel service (Wearne & Morrison, 2011). For example some of the segments which can be identified include:
  • Business travellers
  • Vacation travellers
  • Tour Operators
  • Corporates professionals
  • Promotions and Conference team
  • Event Managing team
Describe the segment(s) of this market targeted by the business
The segments of this market which has been currently targeted by the hotel Shangri-La includes The middle income and the high income people who travel for business and leisure purpose. It also targets the multi-national organizations who send their business professionals in different cities for work. Shangri-La Hotel operates in two segment (Ciuriak, 2015). With its five-star hotel range, it provides room and spa services to the high income people. And with the four-star and budged rage category of hotels, it targets the middle income people.
Explain the positioning of this business in the market for its product/service.
Shangri-La Hotel has been positioned in the hospitality service industry. The company follows a ‘fit’ strategy which helps it to adopt and modify itself according to the external and internal environment of the country in which it is operating. Hence it positions its services in such a way as to appeal to its target customers. With the resort, spa and five-star hotel services it positions itself as high end hotel chain which caters to the needs of the premium customers with world quality services. With its budgeted hotel services available in various cities around the world, it positions itself as a hotel which provide best service to the middle income people who travel for work or leisure ("Highest awards for Shangri-La", 1997).

Section 3

Which elements of the extended marking mix (i.e. all 7 elements) have been carefully managed by the business referred to in this case? And suggest one marketing mix element that might be better managed in order to deliver customer value, justifying your answer.
The seven elements of the marketing mix includes price, people, promotion, product, process, people, and physical evidence. The element of the marketing mix which has been carefully managed by the organization Shangri-La Hotel is people.
Shangri-La Hotel has differentiated itself on the basis of the quality of service it offers to its customers thus taking care of the most important element of the marketing mix. The company strive to go an extra mile when it comes to understanding the specific need of its customers and doing their best to satisfy it (Barr, 2001). With the chain of hotels in different parts of the world, the company suits and adapts itself with the external and internal environment of that country. The quality of the hospitality service received by its customers is achieved by strategies formulated by the company to achieve this. One such strategy is training its employees and keeping them updated and prepared to meet any needs. With ‘Shangri-La Care’ developed by the company, all the employees of the company need to undergo training within the period of six months of joining the company. This creates a consistency in the service received by the customers around the world and also values such as courtesy, respect, helpfulness, humility and sincerity is taught. This program is further divided into four different modules, with each of the module formulated with the objective of ‘delighting customers’. Thus a very high value is placed to this element of marketing mix.
The element of the marketing mix which can be better managed by Shangri-La Hotel to provide better value to the customers is process. This element of the marketing mix is very important for any service industry as the set of process in a service delivery is evidently visible to the customers as it need to be performed on the time of delivery where as in the case of goods, this element of marketing mix is already been performed on the product and the customers only views the end product (Powers & Loyka, 2010). Thus for a business like the one of Shangri-La, the process of each service which is delivered to the customers need to be well designed, formulated and implemented for the customers to receive best experience. As the needs of the customers are very specific and customized, many decisions need to be taken by the employees on the spot. This decision making authority would only work efficiently when there is asset of laid down process of the anticipation and delivery of such services (Kerin, Hartley & Rudelius, 2009).

Conclusion

Any organization operating in more than one country around the world, needs to adapt itself with the specific needs of that country or region. People around the world follow very diverse culture and diverse expectations (Frank, Massy & Wind, 1972). This diversity become a very important aspect to be managed for the overall success of the organization.

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References

Brotherton, B. (2003). The International hospitality industry. Oxford: Butterworth-Heinemann.
Jauhari, V. (2008). Global cases on hospitality industry. New York: Haworth Press.
Chen, J. (2013). Advances in hospitality and leisure. Bingley, U.K.: Emerald.
Park,Seong-Kyu, & Wu Peng. (2013). Factors Affecting Corporate Environmental Disclosure in China. International Business Education Review, 10(3), 111-131. http://dx.doi.org/10.17092/jibr.2013.10.3.111
Saeed A. Mousa. (2016). Macro Perspective of Industry 4.0: Factors Affecting Value Creation Modules. Chinese Business Review, 15(10). http://dx.doi.org/10.17265/1537-1506/2016.10.001
Ciuriak, D. (2015). Macro-Structural Linkages and Business Dynamism. SSRN Electronic Journal. http://dx.doi.org/10.2139/ssrn.2695885
Highest awards for Shangri-La. (1997). The Cornell Hotel And Restaurant Administration Quarterly, 38(4), 18. http://dx.doi.org/10.1016/s0010-8804(97)84293-0
Barr, T. (2001). Shangri-La. Boundary 2, 28(1), 117-119. http://dx.doi.org/10.1215/01903659-28-1-117
Powers, T., & Loyka, J. (2010). Adaptation of Marketing Mix Elements in International Markets. Journal Of Global Marketing, 23(1), 65-79. http://dx.doi.org/10.1080/08911760903442176
Kerin, R., Hartley, S., & Rudelius, W. (2009). Marketing. Boston: McGraw-Hill/IRWIN.
Richter, T. (2002). Marketing mix standardisation in international marketing. Frankfurt am Main: Peter Lang.
Frank, R., Massy, W., & Wind, Y. (1972). Market segmentation. Englewood Cliffs, Nj: Prentice-Hall.
Morrison, A. (2002). Hospitality and travel marketing. Albany, NY: Delmar Thomson Learning.
Wearne, N., & Morrison, A. (2011). Hospitality marketing. Abingdon, Oxon: Routledge.

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