Harvard Case - Warsaw Marriott: New Competition for Warsaw's Marriott Hotel
"Warsaw Marriott: New Competition for Warsaw's Marriott Hotel" Harvard business case study is written by Gary W. Loveman, David T. Kotchen. It deals with the challenges in the field of Service Management. The case study is 26 page(s) long and it was first published on : Sep 30, 1992
At Fern Fort University, we recommend the Warsaw Marriott implement a multi-pronged strategy to address the new competition and maintain its market leadership. This strategy focuses on enhancing customer experience, leveraging technology, and strengthening brand positioning.
2. Background
The Warsaw Marriott, a flagship hotel in the Polish capital, faces a new competitive landscape with the arrival of the Hilton Warsaw. The Hilton boasts modern amenities and a prime location, posing a direct threat to the Marriott's market share. The case study highlights the Marriott's strengths, including its established brand reputation, loyal customer base, and experienced staff. However, the hotel needs to adapt to the changing market dynamics and ensure its continued success.
The main protagonists of the case are the hotel management team, who are tasked with developing a strategy to address the new competition.
3. Analysis of the Case Study
This case study can be analyzed through the lens of service management, specifically focusing on service quality, customer experience management, and competitive advantage.
Service Quality:
- SERVQUAL model: The SERVQUAL model can be used to assess the Marriott's service quality across five dimensions: tangibles, reliability, responsiveness, assurance, and empathy. The case study suggests that while the Marriott scores well on reliability and assurance, it may need to improve in areas like tangibles (modern amenities) and responsiveness (speed of service).
- Moment of Truth: The Hilton's modern amenities and prime location represent key 'moments of truth' for potential customers. The Marriott needs to identify its own unique 'moments of truth' and leverage them to differentiate itself.
- Service Profit Chain: The Marriott's strong brand reputation and experienced staff are assets that contribute to its service profit chain. However, the hotel needs to ensure that these assets translate into a positive customer experience that drives loyalty and profitability.
Customer Experience Management:
- Customer Journey Mapping: The Marriott needs to map the customer journey for various segments, identifying touchpoints where the customer experience can be enhanced. This includes aspects like online booking, check-in, room experience, dining, and check-out.
- Service Blueprinting: The Marriott should develop service blueprints for key service processes to identify potential bottlenecks and areas for improvement. This can help streamline operations and enhance customer satisfaction.
- Service Recovery: The Marriott needs to have a robust service recovery system in place to address customer complaints and service failures effectively. This includes empowering staff to handle issues and providing prompt and personalized solutions.
Competitive Advantage:
- Service Differentiation Strategies: The Marriott needs to develop unique service differentiation strategies to stand out from the competition. This could include focusing on niche markets, offering specialized services, or creating a distinct brand personality.
- Service Innovation: The Marriott can explore service innovations to enhance the customer experience. This could involve incorporating technology, offering personalized services, or creating unique experiences.
- Branding: The Marriott's strong brand reputation is a valuable asset. The hotel needs to leverage this brand equity to attract new customers and retain existing ones. This includes promoting its unique selling propositions and highlighting its commitment to customer satisfaction.
4. Recommendations
1. Enhance Customer Experience:
- Invest in Modernization: Upgrade the hotel's facilities and amenities to match the Hilton's modern standards. This could include renovating rooms, updating technology, and adding new dining options.
- Focus on Service Excellence: Implement training programs for staff to enhance their service skills and ensure consistent delivery of high-quality service. This could include training on customer service best practices, conflict resolution, and emotional labor.
- Leverage Technology: Implement technology solutions to improve customer experience. This could include online check-in, mobile key access, and personalized recommendations through a mobile app.
2. Leverage Technology for Efficiency and Innovation:
- Technology-Enabled Services: Introduce self-service technologies like online booking, check-in kiosks, and mobile ordering for enhanced convenience and efficiency.
- Service Process Analysis: Analyze service processes to identify areas where technology can streamline operations and reduce costs.
- Data-Driven Decision Making: Implement a robust customer relationship management (CRM) system to collect and analyze customer data. Use this data to personalize service offerings, optimize marketing campaigns, and make informed business decisions.
3. Strengthen Brand Positioning:
- Service Value Proposition: Redefine the Marriott's service value proposition to highlight its unique strengths and appeal to specific customer segments. This could include focusing on its history, its commitment to sustainability, or its ability to cater to specific needs.
- Service Marketing Mix: Develop a comprehensive service marketing mix that includes targeted advertising, public relations, and social media campaigns.
- Customer Loyalty Programs: Implement a customer loyalty program to reward repeat business and foster customer loyalty. This could include points-based programs, exclusive offers, and personalized experiences.
5. Basis of Recommendations
These recommendations are based on the following:
- Core Competencies and Consistency with Mission: The recommendations align with the Marriott's core competencies in hospitality and its mission to provide exceptional customer experiences.
- External Customers and Internal Clients: The recommendations consider the needs of both external customers and internal clients (staff). They aim to enhance customer satisfaction while also empowering staff and improving their work environment.
- Competitors: The recommendations address the competitive threat posed by the Hilton by focusing on areas where the Marriott can differentiate itself and maintain its market leadership.
- Attractiveness: The recommendations are financially attractive, considering the potential for increased revenue, improved efficiency, and enhanced customer loyalty.
6. Conclusion
By implementing these recommendations, the Warsaw Marriott can effectively address the new competition and maintain its market leadership. The hotel can enhance customer experience, leverage technology for efficiency and innovation, and strengthen its brand positioning to ensure continued success in the evolving hospitality landscape.
7. Discussion
Alternatives:
- Price Reduction: While price reductions can attract price-sensitive customers, they can also erode profitability and damage the brand's image.
- Merging with the Hilton: This option is not feasible as it would likely face regulatory hurdles and could lead to negative brand perception.
Risks:
- Implementation Challenges: Implementing the recommendations requires significant investment and may face internal resistance.
- Changing Customer Preferences: The hotel needs to continuously monitor customer preferences and adapt its offerings accordingly.
Key Assumptions:
- The recommendations assume that the Marriott has the resources and commitment to implement the proposed changes.
- The recommendations assume that the hotel's brand reputation and existing customer base remain strong.
8. Next Steps
Timeline:
- Phase 1 (Short-Term): Implement immediate improvements to customer experience, including staff training and technology upgrades. (3-6 months)
- Phase 2 (Mid-Term): Develop a comprehensive customer loyalty program and implement service innovation initiatives. (6-12 months)
- Phase 3 (Long-Term): Refine the hotel's brand positioning and develop a long-term strategy for maintaining market leadership. (12+ months)
Key Milestones:
- Conduct a comprehensive customer satisfaction survey.
- Develop a detailed service blueprint for key service processes.
- Implement a CRM system and start collecting customer data.
- Launch a pilot program for new technology-enabled services.
- Develop a marketing campaign to promote the hotel's new service offerings.
By following these steps, the Warsaw Marriott can effectively navigate the competitive landscape and ensure its continued success in the dynamic hospitality industry.
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Case Description
A very successful luxury hotel in Warsaw, Poland is faced with its first serious competition as new luxury hotels enter the Warsaw market. The case raises the general issue of how to sustain a competitive advantage in an international service business. A variety of strategic and organizational options are available and students must consider which are most appropriate given detailed information about the market.
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