Hotel Chain Issues due to Online Websites Services †Free Samples

Question: Discuss about the Hotel Chain Issues due to Online Websites. Answer: Introduction to the Scenario The world has been revolutionized with the growth of internet and web services. There are almost all types of websites for getting any product or service in the market. These websites will provide the facilities which can be availed by sitting at home. Customers can opt for free home delivery for products and free communication with the contact person in case of service (Beritelli, 2016). All these are creating huge problems for the traditional retailers whose business are getting impacted a lot. The retailers have seen a decline in the sales owing to discounts provided by their online counterparts. The tourism and hotel industry has also been swept away with many websites and apps which are providing customized packages to the customers (Haynes, 2015). These websites have already planned a lot to provide good packages at throw away prices. The prices are nowhere near the actual prices being charged by the hotels. This is causing lots of issues to the players in the hotel industry. If they do not tie up with the websites, their sales are decreasing. But, if they are tying up with them, their margins are bleeding. Acting on the situation, a group of 10 hotel chains have come together and opened a new chain called StayTogether. As it is a result of merged entities, they can offer more than 1000 hotels to the customers to choose from. The hotels are trying to combat against the likes of booking.com and hotels.com and create their own website to attract the customers with good discounts and privileges. Issues being faced by hotels due to growing e-commerce booking websites The hotels are facing stiff competition from many low budget hotels with good facilities because of online booking websites. The low budget hotels were previously not sought by many people since their discovery was also not easy. Apart from finding the hotel, the service used to be bad. Nobody wanted to go for a low budget hotel with less facilities and bad service. However, after these booking websites came, their existence was sought upon and they came to a bigger level. All the customers can now check the details of these hotels online. So, the hotels improved the services and facilities which was provided to the customers. These started creating for bigger hotel chains. The demand of low-budget hotels started to rise. They are the most booked hotel category as on date (Hsu, 2015). The big hotel chains started losing out their revenue because of the marketing campaigns and discounts offered by websites like booking.com, hotels.com etc. The discounts are steep and sometimes just provided by the websites to attract more and more customers. They are getting funded from angel investors and the same is offered to customers in the form of discounts. This is leading to revenue fall of hotel chains. Either they have to remain in the market by offering their rooms via these websites at discounted pricing or their existence can come into threat by opting out of these websites. People, today go up to these websites directly to book the hotels and rooms. They do not search for individual hotels. So, it is evident that the hotel chains need to focus on their abilities and should come up with better plan to tackle with these website offerings (Cantallops, 2014). Other issues being faced by the big hotels are their name getting tarnished by the customers who were not able to enter into their premises without the discounts. With the hotels offering discounts, many low income class people are also entering the hotel by booking the room at steep discounts. These have brought down the image of the premium hotels. These premium hotels are no longer premium and exclusive to high income class people. The previous loyal customers are also on the verge of shifting their focus to some other group of hotels because of the crowd living in these hotel chains. The companies are under threat from the onsite offerings of other hotels at discounted prices (Lee, 2013). The way of offerings to the customers and the marketing done by the online sites and the hotels are so attractive that people tend to visit them rather than visiting any particular hotels website. These issues need to be resolved by coming up with some better solutions otherwise the hotels chain s will incur huge losses. Ways to counter the issues The hotels need to counter the issues being faced due to these booking websites. There can be several ways in which the hotels can again increase their market share. The market share of these hotels were decreasing from some time now. The development of the new infrastructure by the hotels should be put on hold and the focus should be given towards the existing hotels by these chains. Instead of new investments in expanding the number of hotels, the investments can be directed towards the implementations of marketing promotions and discounts. These will help the companies to expand in terms of revenues. The hotels can focus on improving the service quality being provided to the customers. The service plays a very important role in attracting new customers. Although, these 10 hotel chains are already known for their hygienic and quality services but still they need to focus more on these and customer satisfaction so that the new customers will get attracted and the old customers will remain loyal to the companies. These can serve as a dual purpose effort for the hotels (Ladhari, 2015). The facilities can also be improvised along with the quality of the service being provided. The hotels have wide network and this network is worth improving. The wide network and reach in various cities will enable the hotels to combine themselves and present themselves as a bigger entity. The name of this entity is StayTogether. STAYTOGETHER can provide steal deals to customers and can provide them to choose any option which is feasible to them. The option may include to choose any city in which they want to book the room. The hotels have a lot of familiarity and they can make use of the same. The restaurants can be ramped up to provide multiple cuisines so that they can attract people from all parts of the world. STAYTOGETHER bookings will be applicable and managed by all the member hotels so there are lesser chances for any shutdown of the entire merged entity (Ling, 2014). Plan to implement the strategy against online booking websites The hotels can team up with marketing and strategy consultants to get more out of the investments that they are going to make in STAYTOGETHER. STAYTOGETHER will be able to capture more market share than they have captured ever before. The market studies have reflected that the customers are now focused on getting more and more discounts. They have become habituated with it. This habit is a long lasting effect created due to the promotions offered by other online booking companies. Thus, they cannot any more for any hotel booking at a higher price now (Ivanov, 2015). This has made the task of the hotels more difficult. To sustain, they need to collect good margin from the customers. The margins can be brought down slightly to increase the market share. The people have the responsibilities in their hand to promote their STAYTOGETHER entity and make the people aware about the same. The important part of STAYTOGETHER will be the synchronization with all the hotels which are part of the STAYTOGETHER group. This wide network will enable the 10 hotel chains to roll out plans which are applicable and acceptable in all the hotels present within their network. The primary part of the strategy implementation will be to first have entire plan ready. The plan will include the strategy along with the timelines to execute the same (Liu, 2014). The companies should take into consideration the demand and supply in the market. The tourism market is growing will ease and relaxations in visa rules all over the world. The ease in the visa rules have given a boost to the sector. People are now easily booking international hotels as well online so that they can roam around risk free with a previous booking. The booking of the hotels online has now become a trend. This trend is continuously increasing. The people will have a lot of offerings from online mode. The STAYTOGETHER needs to come at par with these offerings so that people will prefer their hotels above other low budget or similar priced hotels. The STAYTOGETHER will require to have an online presence with many facilities which can be availed by users directly through online media. The online facilities to book the hotels are very preferable by users. STAYTOGETHER will have the website and one point connection for all the queries related to bookings. The bookings of the hotel will be done instantly with an option to pay directly at hotel. This option will allow the users to cancel till the last moment if they are not visiting the hotel. The users will be having full right and the hotels cannot overprice them for the offerings (Ozturk, 2016). This strategy will be discussed in detail in the next section. Marketing Strategies and Promotions The marketing plans, strategies and promotions are very much important for any company to build a name in the market for its brand. The brand needs to be known to all people so that they can be their customers. STAYTOGETHER also needs to come up with marketing plans and promotions so that customers will get to know about them. The customers will be happy to get attractive discounts and schemes from STAYTOGETHER which is a combined entity of many big hotels. The hotels can offer annual packages at attractive rates which will include free bookings once or twice a year for certain days and nights at any point in time during the year. This will be including many more extra facilities as well. These packages can be well received by clients who can take a membership of STAYTOGETHER by enrolling to a yearly package (Richard, 2017). The benefits of taking long duration package to the customers will be the risk free booking at any time in the year at any hotel within the group they want. This is a good option. Along with this, the STAYTOGETHER has come up with STAYTOGETHER Loyalty scheme which will give rewards to the returning customers in the form of airport transfers of parking facilities or extra night bookings. Moreover, guests can avail dining facilities if any standard restaurant/kitchen is available within the hotel. The exclusive restaurants will be charged extra. Tie ups have been made with certain airlines and rebate will be given in room price to the customers who are coming through those airlines. Free meals can be received with the use of certain credit cards. All these benefits will help the STAYTOGETHER to regain its lost market share and attract many new customers (Ozturk, 2017). Apart from the above offers, the STAYTOGETHER will have some in-app discounts for those who are booking the rooms through their smartphones. These will be over and above the existing discounts. The hotel chains can invest in these marketing schemes for a period of time to regain their lost name and then they can change the promotions to suit at future point in time. Thus, marketing effectively and with proper plans will help STAYTOGETHER to emerge as a winner among the fellow online counterparts (Standing, 2014). Conclusion In the above sections, we discussed about the evolution of web services and online bookings in tourism industry along with it. The onset of the online bookings of hotels has led to decrease in revenues of old hotel chains. The tourism and hotel industry has also been swept away with many websites and apps which are providing customized packages to the customers. These websites have already planned a lot to provide good packages at throw away prices. Acting on the situation, a group of 10 hotel chains have come together and opened a new chain called StayTogether. As it is a result of merged entities, they can offer more than 1000 hotels to the customers to choose from. The hotels are trying to combat against the likes of booking.com and hotels.com and create their own website to attract the customers with good discounts and privileges (Wang, 2016). With the hotels offering discounts, many low income class people are also entering the hotel by booking the room at steep discounts. These have brought down the image of the premium hotels. These premium hotels are no longer premium and exclusive to high income class people. The hotels need to counter the issues being faced due to these booking websites. There can be several ways in which the hotels can again increase their market share. The market share of these hotels were decreasing from some time now. STAYTOGETHER also needs to come up with marketing plans and promotions so that customers will get to know about them (Yang, 2014). The customers will be happy to get attractive discounts and schemes from STAYTOGETHER which is a combined entity of many big hotels. References Beritelli, P., Beritelli, P., Schegg, R., Schegg, R. (2016). Maximizing online bookings through a multi-channel-strategy: Effects of interdependencies and networks. International Journal of Contemporary Hospitality Management, 28(1), 68-88. Cantallops, A. S., Salvi, F. (2014). New consumer behavior: A review of research on eWOM and hotels. International Journal of Hospitality Management, 36, 41-51. Haynes, N., Egan, D. (2015). The future impact of changes in rate parity agreements on hotel chains: the long-term implications of the removal of rate parity agreements between hotels and online travel agents using closed consumer group booking models. Journal of Travel Tourism Marketing, 32(7), 923-933. Hsu, C. H., Liu, Z., Huang, S. (2015). Acquiring intangible resources through entrepreneurs network ties: a study of Chinese economy hotel chains. 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