Introduction
The chosen for analysis InterContinental Hotels & Resorts is Europe’s most significant luxury hotel company today. As such, Juan Trippe founded this hotel chain in 1946, after which it became a member of the Inter-Continental Hospitality Group (IHG) (IHG, 2018, para. 7). Accommodations, eating, bars by the pool, professional services, health services, and venues for events are all provided by the facilities of IHG, which is examined throughout the paper.
Missions, Aims, and Objectives
IHG is a large and ambitious company, judging by its commitments. The company’s mission is to become the top firm in the world by demonstrating outstanding employee values, a strong work ethic, and a commitment to excellence (IHG, n.d.). Moreover, one of its missions includes creating hotels that guests like. The firm aims to grow further, which is supported by its objective of strengthening the involvement and excellent performance of the whole staff (IHG, n.d.). Moreover, the company aims to increase its value creation (IHG, 2019). IHG’s objectives for this goal are the development of preferred brands, the delivery of a superior owner proposition, the enhancement of the loyalty program, the leveraging of scale, and the generation of income through the lowest-cost direct channels.
Marketing Objectives
Marketing objectives are specific and measurable goals intended to provide overall direction and specific actions regarding a company’s marketing plan. IHG uses marketing objectives to increase profits and revenues. For example, one of IHG’s marketing objectives is to create exceptional brand experiences defined by guest satisfaction measurement indicators (IHG, 2020). Secondly, the company aims to raise brand awareness among several essential customer segments. Thirdly, IHG’s marketing campaign involves attracting talented people to enhance the service further, measured through the company’s Academy results (IHG, 2020). Next, to sustain the company’s reputation, it has an objective of engaging with the community’s needs (IHG, 2020). Finally, the company aims to attract more loyal guests through marketing programs.
SWOT Analysis of IHG
A SWOT analysis is a strategy for examining an organization’s strengths, weaknesses, opportunities, and threats, hence its name. Strengths are internal characteristics and resources that contribute to successful growth, such as loyal consumers or excellent customer service. Internal obstacles and resources are analyzed as weaknesses that make achieving success more problematic. External variables, such as advantageous export tariffs or tax breaks, are opportunities that the company can exploit. Finally, external threats, such as increased competition, might risk the entity’s success.
Strengths
IHG can capitalize on its better economic stance since it owns the most valued hotel franchises. The institution’s vast global presence also increases its ability to grow its clientele. The business also provides an extensive selection of brand names. About seven domains for cafes and holidays that are well-equipped and try to give clients great solutions are included in the firm’s copyright portfolio. Due to its wide choice of brands, the firm may profit from more significant economies of scale and a broader consumer base. The business is also well-known in both mature and emerging areas.
The company has expanded its economic stance and increased brand recognition thanks to its significant representation, particularly in growing markets like China. Additionally, the company’s pipeline growth in emerging markets gives it a more decisive economic edge. Such changes help the company to increase its worldwide market presence and benefit from the booming hotel sector in overseas marketplaces. The financial position of International Resorts Group is robust, with five years of continuous profitability and accrued profit cushions that may be utilized to fund upcoming capital needs (Udofia, 2018). With thousands of fans across the three most popular social networking networks, IHG has a significant online footprint.
There are several unique domain interests that the company owns, including brands and copyrights. Due to this, rivals cannot imitate or reverse design their goods, giving them uniqueness. People are familiar with the company since it has been around for a while; therefore, it has excellent market recognition. Clients continue to respect its goods and find a tremendous appreciation for the cash they spend since they have preserved its excellence throughout the decades. IHG develops strategic relationships with its merchants, distributors, and customers. This allows it to use them as leverage in the long term.
Weaknesses
Focusing on middle- and upper-scale premium hotel and tourism brands makes the company vulnerable to several potential widespread economic recessions. Additionally, the organization’s commercial edge is diminished by its single-market emphasis on luxury passengers. Moreover, the development and extension of connected budget hotels in developing economies provide customers with additional high-end amenities. Given its size and placement strategies, the company needs to be in a situation to take advantage of fresh advancements in international economies. There needs to be a consistent move to achievement evaluation. Individuals are frequently not given credit for their achievements. Consequently, workers have lowered work satisfaction and less potential for advancement.
Even though IHG invests more in invention and invention than the industry average, it does so considerably less than a small number of rivals that have tremendously benefitted from their innovative products. The firm accumulates assets due to the usual prolonged time it takes for purchases and deliveries to be made, which increases costs for the business. Instead of being purchased, most of the corporation’s real estate properties are rented. The hefty rent it must spend on these premises raises its costs. The company’s lower cash position to liability ratio could be a problem for its operating liquidity.
Opportunities
The vigorous expansion in advanced nations represents the most likely opportunity. New chances for the company are presented by changes in architecture, market circumstances, and the rise of the higher and lower classes in developing nations. Additionally, these regions’ expanding hotel and tourist sectors provide profitable opportunities. Additionally, the company has a new potential to capitalize on the rising spending ability of the young age, which is seen as the most engaged client segment in both developed and developing nations. The youngsters make the most purchases of fancy goods, style, and entertainment. The business is in an excellent position to benefit from this consumer group.
The business sector has witnessed an increase in revenues and a new phenomenon. This shows that a large group of people is now using the internet. The Hotels can create income by starting physical shops and doing business there. The number of individuals utilizing social media has improved globally. The most significant rise in influential weekly users has been seen on the leading social media pages. The firm can use social media to market its goods and services, engross consumers, and get feedback. Many areas can benefit greatly from innovation (Udofia, 2018). They are making the processes automatic and can lower expenses. Due to creation, the consumers’ data can be gathered, which also helps the company in its advertising initiatives. During the Coronavirus pandemic, there has been an uprise in retail spending and average household earnings. Consequently, the firm’s targeted audience will prosper as more customers are drawn to the organization. The number of people has a high possibility to continue doing so soon. Consequently, The Hotel will be able to reach more prospective consumers, which is beneficial.
Threats
The danger to the enterprise’s functioning is more considerable due to the broader economic slump, which significantly impacts commercial prospects and customer morale. Prospective passengers’ income capabilities have declined due to the slow worldwide economic development and the current business climate. Additionally, the company’s activities are negatively impacted by the diminished respect of clients from industrialized nations. Additionally, the tourist sector may experience a decline in productivity due to decreased air transport, political unpredictability in some countries, global fuel prices, ecological issues, and terrorist concerns (Udofia, 2018). A more significant challenge to the expansion and progress of the company is the quick rise of rival economical brand resorts.
A few trade opponents’ recent technical accomplishments constitute a threat to the company since consumers drawn to the modern innovation may choose to support competitors instead, lowering IHG’s position in the business. Manufacturers’ negotiation power has increased as the number of suppliers has dwindled. This suggests that price levels may increase for the hospitality company. Since there are so many incoming competitors in the marketplace, the already-established sectors are losing market share. This puts the business in danger since clients could leave because of it. Due to rising industry competition, costs have remained under stress to decrease.
The fluctuating exchange rate affects a company like IHG, which has global sales and works with several suppliers. Due to the government’s unpredictable governance, business productivity may suffer, and additional costs may arise. The world’s changing lending rates does not guarantee a stable business situation. Corporates must alter their services to meet customer needs as public tastes change. If a company wants to operate business worldwide, it should comply with the evolving legal framework that governs world commerce. As consumption for the current commodities drops, the supply of substitutes likewise increases, endangering the entire industry.
The company’s cost of supplies has increased due to the increment in gasoline expenses. These expenditures have grown because of the rising prices of fuel, which have also impacted other sectors that this industry relies on for supplies. The hospitality firm has experienced challenges because its rivals have increased their discounts. Clients are flooded with many advertisements, and there is more confusion than ever before on the majority of the media channels. As a result, the advertising messages of IHG are less efficient. The employees should be taught suitably due to ongoing digital advancements since failure to do so might result in the firm losing revenue.
Segmentation, Positioning, and Targeting Marketing Strategies of IHG
Segmentation, targeting, and positioning are parts of a marketing strategy in which one segments the target market, targets the most vital audience groups for offering, and positions goods to successfully capture the target segment. In the segmentation stage, the tactics might include grouping the audience by demographics, psychographics, lifestyle traits, or behavior. Next, the targeting step involves selecting desirable segments from the segmentation phase. For example, a company might consider targeting based on segment size, difference, reachability, profitability, and benefits. Finally, positioning is deciding how to market the product to specific audience segments based on the insights gathered from segmentation and targeting. As such, IHG might segment its customers by their occupations. Next, during targeting, the company can select profitable clients, such as people whose occupation involves frequent traveling and staying at the hotel. Furthermore, IHG can position its brand to this target audience by offering a loyalty program to make the customers seek its service.
The Marketing Mix of IHG
Product, price, place, promotion, people, process, and physical evidence are the seven Ps of marketing. IHG can use these elements to attract and keep loyal to the identified earlier segment of the target audience, which is people whose profession involves frequent traveling. Regarding the product, the company might offer food options popular among busy people. Next, IHG might propose discounts for people who reserve rooms for only a few days due to business. Furthermore, the firm might allocate the hotels in the business areas so that the target audience can reach their destinations. People element can be realized by enhancing the service speed and a proposition of additional errands. As for the process, booking rooms should include quick scheduling and digital access. IHG can promote its services by using the portals and platforms that people frequently use with identified occupations. Finally, physical evidence for this audience might be loyalty cards that prove that the clients have discounts.
Conclusion
To conclude, IHG is a large, ambitious company with a clearly defined mission, goals, and objectives. Although it has had specific difficulties after the COVID-19 outbreak, the company still has opportunities for further growth. Moreover, it can apply the segmentation, targeting, and positioning approach to reach the audience of people whose occupations include frequent traveling. The firm might reach this target market through the use of the 7 Ps of marketing.
References List
InterContinental Hotels Group (2018) InterContinental Hotels & Resorts Celebrates 200 Captivating Destinations. Web.
InterContinental Hotels Group (2019) About IHG, InterContinental Hotels Group. Web.
InterContinental Hotels Group (2020) Our strategy, InterContinental Hotels Group PLC. Web.
InterContinental Hotels Group (n.d.) About Us, InterContinental Hotels Group. Web.
Udofia, D.K. (2018) ‘Intercontinental Hotel Group’s exit from Nigeria: analysis of a receiver/manager’s discretion to repudiate pre-receivership contracts,’ SSRN Electronic Journal, 5(69), pp. 869–875. Web.