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MGK1103 Market Strategies Before Covid-19 Business Repositioning After Business Assessment 3 Answer

A report on small tourism and hospitality-based organization.

A student is supposed to select a restaurant of his/her own choice. It is advised that the restaurant operates a website or an e-commerce site. The case study is critical because of COVID- 19. Students must consider the current situation, which has a significant influence in applying basic marketing strategies.

Key topics

The following topics should be present in the case study. 

Topic 1: Current condition of the organization due to COVID 19. Consider current competitive situation. At least two environmental should be considered from micro and macro environment. 

Topic 2: Identify the current segment and positioning strategy. It is essential to consider the fact that many organizations (restaurant, bars, clubs etc) have been selecting new target market, and repositioning their brand. 

Topic 3: Propose new sets of product, price, place, and promotional strategies due to current situation.


Unit name and code: MGK1103 Principles of Marketing


1. Introduction 

1.1 Key purpose of the study

This study is based on the impact of Covid-19 in this business, how the competitive market has changed, what are the challenges it is facing, and how they can be overcome. Four seasons hotel, Sydney is a renowned hospitality business providing service since 1960. It constantly strives for excellence and quality of service through innovation and dedication to work. The report gives information about the direct and indirect competitors and their macro and micro environmental factors. The case study throws some light on the target market strategies before Covid-19 and repositioning of business after the pandemic. New promotional, pricing, product strategies are covered in this study.

1.2 Report Limitation 

The report is limited to two factors of the micro and macro environment. It is not considering the other environmental factors such as political or legal issues relating to the Covid-19 pandemic. The hospitality business is considered for the case study. It is not emphasizing the overall economy of the country and the policies laid down by the government in fighting the pandemic.

1.3 Data Sources

The data collected through online resources, journals, and books to study the impact of Covid-19 in the economy of the hotel and hospitality business.

2. Four Seasons Hotel –

2.1 Briefly outline the key product and service activities – 

Key product and service activities – Four seasons hotel provides quality food all day long including bars serving exotic drinks part from luxurious hotel rooms. It offers a great stay for a whole family and its services also include a spa, secure parking, and transportation and provides the option to arrange wedding ceremonies (Four Seasons Hotel Sydney, 2020).

2.2 Current COVID-19 - Market Condition – 

Current Covid-19 Market Condition- Due to the outbreak of Covid-19, the hotel is suffering from an economic crisis like any other business organization. In the lockdown period, it has seen a huge downfall in its revenue generation.  

2.3 Industry Competitive Situation – 

2.3.1 Direct Competitors – 

Direct competition refers to competition with business organizations that offered the same products and facilities as the company itself. (Burke et al. 2020). Being in a hospitality business, the direct competitors of four seasons are other hotels in their location having similar pricing strategies and services. The organizations presently providing tough competition to four seasons include the Ritz Carlton, Rosewood, Mandarin Oriental, The Hyatt Group, Hilton, Saint Julien, Striges, Fairmount, The Langham, and Shangri-La (Owler, 2020). The Ritz Carlton is one of the significant competitors of the company (Referred to the Appendix A).

2.3.2 Indirect Competitors – 

Indirect competitors are directly producing a similar service or product but they satisfy the need for a particular product through alternatives. For example, video conferencing and business class flights are indirect competitors as they fight for similar outcomes. The standalone restaurants and spa can provide luxurious facilities which will be competition for Four Seasons. Leisure is achieved by other ways including amusement parks and they can be in direct competition for the company (Burke et al. 2020).Macro factors

Figure: Macro factors

Source: (Business Jargon, 2020)

2.4 Macro Environment – Hospitality Industry

The macro-environment are external factors of an organization which affects the productivity of the organization. These factors include political, socio-cultural, economic, legal technology, and environment. These factors are unpredictable, dynamic, and beyond the control of the organization (Business Jargons, 2020).

2.4.1 Macro Environmental – 

The economic condition of the people is affected due to the huge amount of unemployment caused by the Covid-19 pandemic. The country’s economic downfall has a large impact on the revenue generation of the hotel. People are losing their jobs or being less paid for more work that is affecting their ability to spend. Less number of tourists are visiting the country as most of the flights have stopped. Daily expenses are cut to only essential products and in such a scenario, spending inexpensive hotels and going for vacations is completely irrelevant in the current scenario. The outbreak of this pandemic has affected the world economy and has brought insurmountable challenges to the tourism and hospitality business (Alonso et al. 2020).

2.4.2 Macro Environmental – 

Covid-19 virus is highly contagious and it is causing life risk in some parts of the population. Senior citizens and people with comorbidity are susceptible to this virus attack leading to a serious health hazard. Hence, the environment of the hotel needs to be kept clean and hygienic. Proper sanitization and maintaining social distancing are considered key factors that are related to safety measures of the environment post-covid-19 situation. A large portion of the population is not interested to dine outside which is nearly 50% (Gursoy & Chi, 2020).

2.5 Micro Environment – Business

The microenvironment is intrinsic to the organization and helps in building a reputation in a larger context that affects the macro-environmental factors. The company must work on the internal features for building a proper foundation of the organization. The factors include consumers, suppliers, competitors, dealers, distributors, and the general public that affects the business outcomes (Bhasin, 2019).  

2.5.1 Micro Environmental – Factor 1

In the pretext of the covid-19 pandemic, the sole responsibility of the company lies in providing a safe and healthy environment for its employees. A new initiative by the organization Lead with Care aims at providing training to its employees for treating guests with care and also each other (Four Seasons, 2020). The program focuses on giving care, comfort, and protection by using technologies and expertise suggestions during the covid-19 situation.

2.5.2 Micro Environmental – Factor 2

The suppliers of the company have a vast range of variables including the goods required for hotel amenities starting from bedding, toiletries, and supply of raw materials for restaurants and bars. It is mandatory to follow the regulations laid down by the government for the supply chain management. Proper sanitization in packaging and distribution is required for maintaining the safety of the consumers and employees.

3. New STP – COVID-19

Segmentation is related to a market differentiation strategy where a target consumer is selected based on segments. Segmentation helps in targeting the right people in the right way instead of generic messages for audiences.  The factors that affect the segments are demographic, psychographic, geographic, and behavioral (Lotame, 2019). Four seasons hotel target the upper-class consumers who consider luxury as the most important factor. Business and elite classes are also addressed. The reason is the high price of the rooms due to personalized facilities and expensive dinner and spa packages. Youth are attracted as special packages are provided for couples. The position is in urban cities that attract elite class middle-aged people. It provides amenities for families which makes it a perfect option for people from gen x to gen- y (Gubler, 2015). The golden rule of the organization 'Treat others as you wish to be treated' and it provides 24 hours of personal service to its customers. 

3.1 Target Market – COVID-19

The new target market must be introduced where segmentation should not be limited to the elite class. The hotels must include rooms that are lower in charge so that the middle-class population can afford it. Basic facilities at a reasonable price can increase the consumer base for the organization which will help in capturing the market and having an edge over its competitors. The introduction of the FourSeasons App is a masterstroke by the organization which offers services to the guests without face to face interactions with the employees. They can reserve a room, schedule their transport for flight, room services, spa, and restaurant services and luggage pick up all using the App. Cancellation policies are introduced and people can come back in their own time whenever ready to visit. The use of technology will ensure safety to consumers and attract a larger consumer base as people are preferring online services in a pandemic situation as physical contact is unsafe (Four Seasons Hotel Sydney, 2020).

3.2 Target Position – Reposition – COVID-19

The location of the hotel is based in urban centres targeting the elite and business class. Opening new outlets in some more locations and suburban areas can bring in customers from the very sector of society. For curbing the losses during the lockdown sessions, it has become mandatory to increase its revenue generations. It is important to focus on basic facilities like a comfortable and hygienic room, Wi-Fi connections, and proper food. Extra big rooms, personalized facilities, more spending on food & beverage is not required at the present condition. Common areas need to be spacious for supporting the social distancing norms and presently, wedding ceremonies must not be encouraged as they require large space. Security services should constantly do thermal scanning of visitors. As employees are being laid off post-covid-19, more back house areas must be available which can be used for administrative purposes (Thadani & Sharma, 2020).

4. Revised Marketing Mix – 4Ps

The market mix strategy is used for promoting existing products or launching new products. The 4 P's of the marketing mix are product, price, promotion, and place (Kenton, 2019).4Ps of Marketing

Figure: 4Ps of Marketing

Source: (Free PowerPoint Templates, 2018)

4.1 Product Strategy

The product strategy includes the products sold by the organization. Four seasons hotel provides luxurious rooms with restaurant and spa facilities. People can have personalized services. The buffet system and spacious lounges are a specialty of the hotel. 

4.2 Price Strategy

The place defines the location where the organization is located and the areas of operation. It is a business marketing strategy to select the proper location for targeting its potential consumers. In a consumer-based strategy, the highest importance is given to the target consumers. 

4.3 Place Strategy

The price of products is directly related to revenue earned and annual incomes. The price is based on the capacity of consumers and what valuation they are agreeing upon for the product. The correct pricing strategy can increase profit margins and ensure productivity. High prices can increase the revenue but it reduces the number of consumers.

4.4 Promotion Strategy

Promotion and advertising increase the brand value of the organization. Building a brand image will target a large range of consumers. Online promotion is currently the most promising strategies to increase business.

4.5 Comparison Table – Before COVID19 and During COVID19

Pre covid-19 situation
During-covid-19 situation
The company focused on higher price rooms and facilities were personalized in terms of food and beverages or spa.
As large families may require bigger rooms for accommodation, it should be the new product strategy to provide spacious areas in the room. Proper hygiene must be maintained in terms of packaging products of spa and wellness. Room services must clean the room after every visit to ensure hygiene and safety from the disease. 
High priced products and luxurious rooms targeted the educated elite class and business class. Mostly people visited for luxury during the vacation. Providing exotic services like restaurants and restaurants made pricing higher.
Value-based pricing must be encouraged where hyper-personalization must be attained. The leisure sector is the prime focus where better amenities must be provided in spa and restaurants for attracting the segment of the population who visits the hotel for environmental change (Singh, 2020).
The hotel is located in cities to capture the market of educated and sophisticated people who value their exotic themes and luxurious decorations.
Changing the location completely may lead to huge establishment costs. The hotel can think of opening new chains in suburban locations to attract more number of consumers for coping with the loss due to the Covid-19 pandemic.
Advertising through media and websites were common for the promotional purpose of the hotel. The concept of 24X7 room service is a promotional strategy that attracts a large number of consumers.
The hotel already promotes its Lead with Care campaign on its website which aims at providing safety and hygiene to the customers. It is in Agreement with John Hopkins Medicine International for health and safety decisions evolving in the Covid-19 pandemic. The FourSeasons App is promoting the hotel's services free of contact with employees where people can pre-book their rooms, spa, and restaurant facilities (Four Seasons Hotel Sydney, 2020).

Table 1: Comparison between marketing mix strategies before and after Covid19

Source: (Developed by the Author)

 4. Conclusion

Given the covid-19 pandemic various macro and micro environmental factors have been considered that are providing competition to the business services. Consumers and suppliers are core factors for any organization to survive. Being in the hospitality business, hygiene is the most important aspect of the covid-19 situation. Apart from that economic conditions and environment provided by the organization plays key roles in combating the loss during the Covid-19 pandemic. It is necessary to win the trust of the consumers and proper promotional and product strategies helped in gaining an advantage to overcome the situation. The pricing strategy introduced was value-based and personalized for attracting a particular consumer group. It is observed that leisure is the only way for managing the loss during a pandemic situation. Hence, proper pricing strategy and providing hygienic and spacious accommodation will help to increase the revenue of the company. Introducing the Lead With Care initiative and Four-season App are the key findings of the study which will prove beneficial for the company. Customers are of the highest priority and the management must try to provide services to the best of their potential for bringing more customers to their place. 

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