INDUSTRY RESEARCH: THE MANILA HOTEL

THE MACARONS GROUP

I. Introduction

I. IntroductionOur country’s hotel industry is

expected to see a continued growth in the next five years, according to a

newly released Philippine Star article.

I. Introduction

It is our duty as citizen of this country to pay full attention to some of our country’s growing industries.

I. Introduction

We can always be informed about some of our country’s premium

hotels.

II. Industry Analysis

Hotel IndustryHotel Industry is a form of

business relating to the provision of

accommodation.

To distinguish the types of hotel industry, there are some things to classify them. Among them are:

1.By location (Hotels City or town, Residential hotel, Hotel resort)

2.Based on theNUMBER OF ROOMS

3.Based on the classification

Key Players

Consumer Spending

Spending on Hospitality The Hotel Consumers

International

On a Specific Basis

The Hotel ConsumersExpensive Hotels, High Service Hotel Less Expensive, Moderate Service

Consumer Spending on a Specific Hotel

Expensive Hotels, High Service Hotel Less Expensive, Moderate Service“Based on socioeconomic class of A to B, a consumer spends usually ranging

to P12,750 as the lowest to P92,245+ in a five star hotel, already including the

corporate promos. ”

- Mr. Mhel Kelvin Tan

A Consumer of a less expensive and with a moderate service hotel can spend P850 to P2845 in a 24 hour

stay.

Mariposa Hotel, Sogo Hotel

International Consumer Spending in Hotel Industry

Accommodation

Accommodation

Accommodation

Accommodation

Competitive Landscape

II. Industry analysis:

Production and Cost Issues

1)Labor and skills shortage

It has become a global challenge to attract and retain qualified

workers because of the industry’s reputation

itself.

II. Industry analysis:

Production and Cost Issues

1)Labor and skills shortage - SOLUTION

Grow your own.Hotel companies need to

develop internal programs to create

attractive career paths.

II. Industry analysis:

Production and Cost Issues

1)Labor and skills shortage - SOLUTION

Pay for productivity. Hospitality is a labor intensive business.

II. Industry analysis:

Production and Cost Issues

2) Escalating operating costs

There is a concern about operating

expenses increasing at a greater rate than

income.

II. Industry analysis:

Production and Cost Issues

2) Escalating operating costs -

SOLUTION

Monitor the brand standards.

II. Industry analysis:

Production and Cost Issues3) Rising of energy costs

It may decline the hotel industry’s sale.

II. Industry analysis:

Production and Cost Issues

3) Impact of the rising of energy

costs - SOLUTION

Energy’s continuing threat to the industry will undoubtedly force industry executives to be more creative, or at

least more conservative.

II. Industry Analysis: Current Pricing Practices

1)Service GuaranteesThe guarantee gives the customers a recourse — usually a reduced price or refund —for a burden that they have endured.

II. Industry Analysis: Current Pricing Practices

2) Flat-Rate PricingFlat-rate pricing alleviates customers’ uncertainty by agreeing on a price beforehand.

II. Industry Analysis: Current Pricing Practices

3) Price BundlingThe act of placing several products or services together in a single package and selling for a lower price than would be charged if the items were sold separately.

II. Industry Analysis: Current Pricing Practices

4) Competition PricingSetting a price in comparison with competitors.

II. Industry Analysis: Current Pricing Practices

5) Product Line PricingPricing different products within the same product range at different price points.

II. Industry Analysis: Current Pricing Practices

6) Psychological PricingThe seller here will consider the psychology of price and the positioning of price within the market place

Company Analysis

III. Company Analysis: Company Background

SERVING BEAUTIFUL MEMORIES

103 YEARS AND COUNTING

Then and now, our halls have always been the choice for

classic luxury.

III. Company Analysis: Company Background

FACILITIES AND SERVICES

1)Rooms & Suites

Decorated in classic Filipiniana for your convenience and

comfort.

III. Company Analysis: Company Background

FACILITIES AND SERVICES

2) Meetings & Events

The modern meeting facilities are well

equipped.

III. Company Analysis: Company Background

FACILITIES AND SERVICES

3) DiningThe Manila Hotel offers a wide-ranging line-up of restaurants from French

and Italian cuisine to Chinese and local and international flavors.

III. Company Analysis: Company Background

FACILITIES AND SERVICES

4) Cafe Ilang-Ilang

A renaissance of chic casual dining.

III. Company Analysis: Company Background

FACILITIES AND SERVICES

5) Mabuhay Palace

Tickles the palate with authentic Cantonese

cuisine.

III. Company Analysis: Company Background

FACILITIES AND SERVICES

6) Champagne Room

Relive the grandeur of Old World Europe.

III. Company Analysis: Company Background

FACILITIES AND SERVICES

7) TaproomEnjoy snacks and drinks

amidst a cozy atmosphere.

III. Company Analysis: Company Background

FACILITIES AND SERVICES

8) Pool Bar Sit back in any of the luxurious DEDON orbit

chairs that line the upper deck.

III. Company Analysis: Company Background

FACILITIES AND SERVICES

9) Health Club Fully equipped with the

high technology Life Fitness Signature Series

machines.

III. Company Analysis: Company Background

FACILITIES AND SERVICES

10) Health & Wellness Center A unique environment

combining leisurely pampering and genuine

Filipino hospitality.

III. Company Analysis: Company Background

“It varies.”- Sir Mhel Kelvin Tan

TARGET MARKET

III. Company Analysis: Company Background

“There are certain corporate

companies, too, but government

occupies larger area.”

- Sir Mhel Kelvin Tan

TARGET MARKET

III. Company Analysis: Company Background

“Kasi flexible naman ang Manila

Hotel.”- Sir Mhel Kelvin Tan

TARGET MARKET

III. Company Analysis: Company Background

MARKETING STRATEGIES

“As sales, our main job is to do sales

call.”- Sir Mhel Kelvin Tan

III. Company Analysis: Company Background

MARKETING STRATEGIES

“Usually, we use social media.”

- Sir Mhel Kelvin Tan

III. Company Analysis: Company Background

MARKETING STRATEGIES

“ Like recently we have holiday, yung holy week, we sell

the room from P9,395 to P4,100 +

+.”- Sir Mhel Kelvin Tan

Main Competitors

SHANGRI - LA

Edsa Shangri-La is a 5-star luxury hotel located at Ortigas Center, Mandaluyong, Philippines. The hotel is designed in a beach-resort style within the downtown area of the city.

SOFITEL

Sofitel Philippine Plaza Manila is an iconic 5-star luxury resort nestled in an expansive tropical setting close to the largest convention center, theaters, museums, government offices and the Mall of Asia.

THE PENINSULA MANILA

The Peninsula Manila has set the benchmark for luxury and sophistication. Known affectionately as the “Jewel in the Capital’s Crown” for its legendary presence in the heart of Makati City.

HYATT CITY OF DREAMS MANILA

Hyatt City of Dreams Manila is a stylish, modern hotel at City of Dreams Manila—an exhilarating 6.2-hectare integrated hub of international retail, world-class dining and globally renowned nightclubs and entertainment within Paranaque’s Entertainment City.

Demand Factors

Importance of Price to Consumer of the Business

The Buying Behavior of Consumers

How Sensitive Consumer to Price

Importance of Price to the Consumer of the Business

According to our Interviewee, Price is how consumer perceived the quality of the hotel can give. They feel secured that they will get what they pay for.

The Buying Behavior of ConsumersIn Service Marketing Perspective

● Their Perception- Manila Hotel gives good quality of service and provides luxurious

facilities = Willing purchase Service- Five Star Hotel = Expensive● Higher the Price = More Willing to Purchase Services● Promos for Flexibility of Target Market

How Sensitive Consumer to PriceAccording to Mhel Kelvin Tan, the corporate account manager of Manila Hotel, consumers of the said hotel are not price sensitive because of the socioeconomic class that they belong to. They are willing to spend money for their necessities/wants in the hotel.

III. Company analysis:

Production and Cost Issues

1)Labor and skills shortage

It has become a global challenge to attract and retain qualified

workers because of the industry’s reputation

itself.

III. company analysis:

Production and Cost Issues

2) Escalating operating costs

There is a concern about operating

expenses increasing at a greater rate than

income.

III. Company analysis:

Production and Cost Issues3) Rising of energy costs

It may decline the hotel industry’s sale because travel expenditure will probably be the one of the many things the

personal and corporate individuals will

eliminate given the fact that energy costs gets

higher.

III. company analysis:

Production and Cost Issues

4) Escalating construction and renovation costs

For new constructions, the increasing

construction cost will add up to the capital requirements for a constructing hotel.

III. company analysis:

Production and Cost Issues

5) Accelerating change and merging of

technologies

The investment required to adapt to these rapid changes

regarding technology is really significant for

this industry.

Current Pricing Strategy- Going Rate Pricing

According to Mr. Tan they base the price largely on the competitor's’ price

- Seasonal Discounts

Christmas, Easter Sunday, etc.

- Quantity Discounts

For Companies

Conclusion

●Be Knowledgeable of the Competitors

“Pressure isn’t always a bad thing. Without pressure, there are no learnings.”

- Dawn

Sourceswww.fivestaralliance.com/luxury-hotels/800/asia/philippines/manila

www.euromonitor.com/consumer-lifestyles-in-the-philippines/reportwww.nielsen.com/ph/en/insights.html?tag=Category%3AConsumerhttp://www.hospitalitynet.org/news/4025771.htmlhttp://industry-trade.blogspot.com/2011/09/h otel-industry-definition-and.htmlhttp://manila-hotel.com.ph/section/rooms/http://www.udel.edu/alex/chapt6.html