Dusit International

Assignment II

ICTM 401 Strategic Management for Travel Industry

Amica Rangnoktai ID- 5080579

Sumandeep Thakral ID- 5180657

Naval Thakral ID- 5180658

Vethida Sithichaiudom ID- 5180832

Shivanshai Sethichaiyen ID- 5280510

Table of Contents

Business-level strategy...............................................................................................................2

Demographic factors:.................................................................................................................3

Socioeconomic Factors:.............................................................................................................5

Geographic Factors:...................................................................................................................6

Psychological Factors.................................................................................................................6

Consumption Patterns................................................................................................................8

Perceptual Factors:...................................................................................................................11

Generic business- level strategies of Dusit..............................................................................15

Supply chain management.......................................................................................................21

Operation..................................................................................................................................26

Distribution..............................................................................................................................27

Marketing.................................................................................................................................28

Follow up service.....................................................................................................................33

Finance.....................................................................................................................................34

Human Resources.....................................................................................................................35

Analytical Idea.........................................................................................................................39

Strategies relate to Vision and Mission....................................................................................40

Competitive rivalry and dynamics...........................................................................................43

Strategic and tactical action.....................................................................................................64

Corporate Level Strategies.......................................................................................................82

Hotel businesses.......................................................................................................................97

1

Business-level strategy Market Segmentation

Market segmentation is the technique used to enable a business to better target it

products at the right customers. It is about identifying the specific needs and wants of

customer groups and then using those insights into providing products and services which

meet customer needs. In addition, the businesses need to segment their markets is because

customers differ in the benefits they want, amount they are able to or willing to pay,

media (e.g. television, newspapers, and magazines) they see, quantities they buy and time

and place that they buy(Riley, 2010).

However, there are various methods (or “bases”) a business can use to segment a

market. Some of the most popular are summarized below:

 

1. Consumer Market

To begin with, Dusit Thani target two main group of customers based on their length

of stay at the hotel that is short haul and long haul customers. Short haul customers are those

customers that travel for business purposes and they make their booking at Dusit Club which

is much more expensive and customer are willing to pay for it is just because of the

extraordinary services that are provided to them. However, for long haul customers travel for

2

recreational purposes and want to experience the uniqueness of Thai culture (Dusit

International, n.d.).As a result, Dusit Thani does not have to depend on customers with low

bargaining power as they target various group of customers. Therefore, for the market

segmentation, Dusit Thani has divided their target market into many groups as they are

various groups of customers that the company wants to focus:

Demographic factors:

The respondents of the research were the customers who used the services of Dusit

Thani Hotel during the research period. Three hundred sets ofquestionnaires were distributed

and all of them were checked for the completenessafter returned by the respondents. The

respondents’ profile covers the respondents’gender, age, purpose of their trip, monthly

income, and education level as shown onbelow.

1. Gender and Age of the respondents

Based on the research of 300 respondents, there were 195 malerespondents or 65 %

and 105 or 35% females. Within 195 male respondents, 68.5%or 63 respondents were aged

between 20-30 years old. 93 respondents or 65% weremale who aged between 31-40 years

old. 25 respondents were respondents were male whose age were between 41-50 years old

and 14 respondents or 70% were malewhole age was more than 50 years old. Moreover, the

rest 105 respondents werefemale or 35% of the total respondents which composed of 29

respondents who werefemale aged between 20-30 years old, 50 respondents were female who

aged between31-40 years old, 20 respondents were female who aged between 41-50 years old

andthe rest 105 of 35% were female who aged over 50 years old. From respondents

‘characteristics as described by age group mostly the main respondents were both maleand

female who aged between 31-40 years old. As a result, we could see from the statistics that

65 percent of male visited the hotel and only 35 percent of female visited the hotel.

Therefore, more number of males are visiting the hotel than the female.

2. Gender and The purpose of Trip

Out of 300 respondents, there were 195 malesrespondents, in which 143 male

respondents indicated the purpose of their trip as fortravel purpose while the other 52 male

respondents indicated their purpose as leisuretrip. And for 105 female respondents which

3

comprised of 43 female respondentswho took their trip for travel purpose while 62 female

respondents took also theleisure trip. This finding also indicated that both female and male

guests of Dusit Thani indicated that purpose of their trip is for travel and leisure purposes.

Unlike business travellers, leisure travellers tend to spend more time in the hotel due to

varieties of activities offered by the hotel with standard service quality. For example, Dusit

Thani offer fitness center and spa service and they ensure that they run smoothly.

3. Marital Status and Purpose of their trip

Based on this survey, I found that 190 of 300 respondents or 63.3% were married

while 84 of them (28%) were single.The rest 26 respondents were divorced. The finding also

indicated the purpose of thetrip crossed with the marital status. As a result, respondents who

were single and married were more likely to take the traveltrip rather than leisure trip but

respondents who were divorced were more likely totake the leisure trip than travel trip.

4. Nationality of the Respondents

The nationality of the respondents, out of 300 total respondents, majority ofthe

respondents were Japanese which was 66 respondents is accounted for 22%,second largest

group was American which was 60 respondents or accounted for 20%.European respondents

were ranked as the third largest group, which were 58 out of300 respondents or 19.3%. The

fourth group was British respondents; there were 55British respondents or 18.3%. The fifth

group was Korea, which were 29 respondentsout of 300 or 9.7%. Australian respondents

were ranked as the six largest groupswhich were not quite much, only 21 respondents out of

300 or 7%. The othernationality group was accounted for 3.7% or 11 respondents out of 300.

There indeedwas a wide spectrum of customers of this Hotel come from Asia and Europe,

whichindicated Dusit Thani Hotel, tends to target customers of Middle East as they have high

spending power and mostly male for business purpose.

5. Monthly Income (in Thai Baht)

Based on the survey, 19 respondents or 6.3% respondents had the monthly incomebetween

20,000 – 39,999 Baht. 15 respondents or 5% were those who had themonthly income

between 40,000 – 59,999 Baht. 25 respondents or 8.3% were thosewho had the monthly

income between 60,000 – 79,999 Baht. 114 respondents or 38%were those who had the

monthly income between 80,000 – 99,999 Baht. And the restof them or 127 out of 300

respondents or 42.3% had the monthly income above100,000 Baht. Surprisingly, the majority

4

income group of Dusit Thani wasthose who had income 100,000 Baht per month and above

which was accounted for42.3% while the least group was those who income ranged 40,000 –

59,999 Baht permonth which was only 5% for this group of respondents. As a result it is

expected that.

6. Education Level

Out of 300respondents, there were 217 respondents or 72.3% who were Bachelor

Degreegraduated. 49 respondents or 16.3% were under Bachelor Degree and 34

respondentsor 11.3% were those who had higher than Bachelor Degree.It is expected that

most of the customers of this hotel to be educated orschooled as they were coming from a

higher income group and were in for businesspurposes. Therefore it is likely that they had

gone through tertiary education (Roongravi, n.d.).

Socioeconomic Factors: More woman business travelers

The social and cultural environment consists of broad societal trends which affect

hotel organization. The most profound social changes in recent years have been the entry of a

large number of women into the labour market. Women are earning more money than the

past and are remaining single longer. And they may travel more for all business and leisure

purposes. It has created or greatly expanded the demand for a wide range of hotel products

and services necessitated by their absence from home such as hotel with spa treatment and

fitting room. This factor has a positive impact on Dusit Thani because they have a chance to

increase their revenue as well as increase the service quality of spa and fitness center by

offering special training course for employee in order to improve female guest's satisfaction.

From this fact Dusit has created a strategy to support this female market by introducing their

spa to a unique that provides their guests with a luxurious, sensory and therapeutic

experience. The Devarana Spa at Dusit Thani is offering a range of relaxing and results

driven treatments, including facial, water and beauty treatment. Moreover, Dusit Thani has

created their own spa products by bringing the best quality of ingredients to produce the

botanical spa collection which includes body care, oil blends and heaven scents. Each of the

products has the Devarana spa trademark stamped on the packages.

More Family with children market

5

From the Family Travel Forum's, said that hoteliers need to pay more attention for a

family market, especially a family with children. After five years studied the family vacation

market, the report concluded that “just-for-kids” amenities are more important with family

vacationers because if the kids aren't happy, no one's happy. Kid's satisfaction is key

successful for hotel industry now because it plays an important role in the repeating of their

parent at the accommodation so that the hotel should have new target market - younger guest

market. According to a 2009YPartnershipreport, 43% of U.S. adult travelers took one or

more trips with kids in 2009, up from just 26% in 2000. Therefore with these information

added with the evident from Dusit Thani Hotel, Marital status, in which shown there are a

tremendous number of business men and women who already get married and might bring

their kids with them for the vacation. Dusit Thani Hotel should consider investing more in

family amenities such as kid-themed family suites, children's programs, water slide, kid club

and welcome gifts. With some extra amenities it is also an opportunity for hoteliers to charge

for at least some of their kid-pleasing amenities. I am quite sure that many parents are more

than pleasing to pay for the happiness of their children. In another hand if the hotel don't have

any of the kid facilities and amenity, many business parents may denied to stay in another

hotel or choose the alternative hotel which can comply with their need.

Geographic Factors:When traveling, we can say that the locations of our accommodation will play a big

role in overall enjoyment of the trip. That's because a well-located hotel will significantly cut

down on the amount of time we waste in traffic or trying to navigate an unfamiliar place. For

business travellers, centrally-located hotels will increase productivity by allowing them more

time to work and meet with colleagues. For Dusit Thani Hotel, this is ideally located in the

heart of Bangkok, known as the “City of Angels’. The luxury hotel is adjacent to both the sky

train and subway systems within easy proximity to major business, shopping and

entertainment centres. Additionally, Dusit Thani is well positioned to take advantage of

selective investment opportunities in strategic locations that offer attractive returns, while at

the same time the strong brand continues to be compelling to developers of luxury hotels.

Moreover, Dusit Thani tends to target by regions as well including Europe, Oceania, East

Asia, Asian, and American. By national differences including United Kingdom, Germany,

Japan, Hong-Kong, Australia, Switzerland, Italy, Singapore, Korea and American market.

6

Psychological Factors Brand awareness

The first thing to recognize when we talk about brands is that they are not just names,

terms, symbols, designs or combinations of these, although it is true to say that such things

can and do differentiate certain products and companies from others. The additional

ingredient that makes a successful brand is personality. Today’s leading brands are

personalities in their own right and are well known in all societies. Brand has truly

psychological factors involved as it gives consumers the means whereby they can make

choices and judgments. Bases on these experiences, customers can then rely on chosen

brands to guarantee standards of quality and service, which reduces the risk of failure in

purchase. Dusit Thani themselves see the very important in the brand awareness, they has

built their brand to be very strong as they have stated in their mission statement as to make

Dusit one of the world’s most valued hospitality brands in preference and loyalty across

every one of its competitive segment. Moreover, the core of the Dusit Thani brand is offering

its customers an exceptional hospitality experience that reflects the unique artistry and culture

of Thailand. Every hotel under the group offers the unique experience and ambience

including the taste, smell and the friendly service. The management team has ensured a

continuous investment in all aspects of the brand to ensure consistent delivery of all the brand

promises. Furthermore, Dusit Thai has used Fan Campaign as one of the strategy to support

their brand. This fan campaign has a great influence to people when they look towards the

brand in ways that if the celebrities has stayed in this hotel before then it is most likely that

this hotel is really good and this is install into the perceptions of the customers.

Sustainable Tourism

Consumer awareness of the environmental impact of their holidays is expected to

continue to rise in 2013. One in three holidaymakers now believes that holidays should have

an environmental rating, such as that offered by the ABTA developed Travel life

Sustainability System. ABTA estimates that this represents over ten million people taking

foreign holidays. The figure has grown from 29% in 2010 to 33% in 2011, and is higher

amongst women ‐38%. The research also suggests that companies which invest in making

their business better for the environment stand to gain a competitive edge, with 19% (up 2%

from 2010) of consumers saying they are prepared to pay more for a holiday with a company

that has a better environmental and social record (Travel life, n.d.). As customer nowadays

7

they really concern about environment. Therefore, the hotel should be participated in Waste

Disposal Campaign in order to protect the environment and saving the operating cost and

increase the profit margin reducing energy costs while continuing to meet the diverse

requirements of customers is challenging in the hotel industry. Dusit Thani Hotel should pay

attention to reduce the electricity consumption, especially in the low occupancy period.

Consumption Patterns Online marketing

Tourism destinations need to modernize their marketing strategies and follow

customers online, experts agreed at the 19th World Travel Monitor Forum. The world has

gone online. Consumers around the globe now inform themselves, buy and sell products and

services, and communicate with others on the internet, through social media and via

smartphones. The travel and tourism industry is no exception. Tickets, holidays and other

travel products and services are researched, booked and then commented online more and

more. And this trend will speed up in future, experts agree. Online travel sales in the USA,

for example, are forecast to grow 46% to $145 billion from 2009 to 2015, according to digital

research company E-Marketer. More and more travellers are starting to use their smartphones

to manage their entire travel experience, from information and booking, through use at the

destination to post-trip activities. Moreover, people are becoming ‘social travelers’, using

online social networks while on holiday which is much faster and convenient for the

travellers Furthermore, companies tend to focus a lot on online marketing. Based on the

research, 60 percent of companies surveyed said that they were reducing their print

advertising budgets, and 48 percent said they were adding to their social network marketing

and email campaign as shown in the diagram below (Online Marketing, 2011).

8

In today's changing market, companies can afford to allocate their marketing budget

to a cutting-edge strategy that will provide the greatest possible return on investment. Our

expert consultants constantly follow market trends and assess the viability of all avenues of

marketing, and can help them couple an online marketing strategy with basic traditional

marketing for significantly increased results and revenue.

Customers need more technology

Perhaps the most important characteristic of the new generation of tourists, however,

is that they are ‘digital natives’ who have grown up using computers, the internet and now

mobile technology and social media. Now they are using these digital channels to plan and

book their travel. Online bookings of tours, flights and accommodation are increasing fast;

even through travel agents still remain the main booking channels, the Asian Travel Monitor

found. Outbound consumers use online media extensively for travel planning and information

purposes. After their trips they heavily use social media and other online platforms to

communicate their experiences. More generally, digital and social media have become the

most influential information and communications channels. With these information, Dusit

Thani hotel also have a strategy to support these need of technology.

9

Dusit Thani will continue to launce new technology as well as outsource professional

company such as the IT Services business unit of RingZero which is a client centric provider

of a high quality, timely and cost effective range of technology consulting and IT solutions to

service their customers(Ringzero Network, n.d.).

Good service and facilities

Based on the ABTA travel trends report of 2012, especially the low-income travellers

are more conscious about the service and facilities that they will get rather than on the price

(The Travel Association, 2011). Nowadays, people are demanding for more quality services

and facilities such as more of low income travellers are willing to even a pay premium price

for the remarkable services and good experience that they can get and the number of people

in this group will tend to increase tremendously. To illustrate, Dusit Thani hotel, provides

exceptional services and facilities with authentic experience by creating Thai culture and

tradition (Dusit Thani Bangkok, 2010).

Consumers tend to travel by themselves rather than relying on tour groups

There is a key change in the trend as they is a shift from group travel to individual

travel as now travellers they want to gain more of individual experiences rather than relying

on the groups. To illustrate, as now Chinese tourist have become more demanding especially

they are demanding for higher quality services and moving from traditional tour groups to

more individual travel experiences and if these Chinese tourist are not satisfied with the

service they receive they are likely to spread negative word of mouth. Additionally, language

and culture is a vital factor for Chinese travellers. Most of the Chinese travellers still demand

for sightseeing however, this will likely change in the future as travel will become part of

more comfortable lifestyle and the travellers will desire more of relaxation and entertainment.

Moreover, the hotel industry should offer ‘China-ready’ services to visitors to make them feel

like they are at their home. For example, Dusit Thani has a Chinese-speaking staff and they

even provide Chinese menus in their restaurant and also provide hot water cookers for instant

noodles and slippers in the hotel room. As a result, individual travel has brought opportunities

for the hotel to attract more customer as they can choose the accomodations according to

their preferences based from the NBT world travel record.

10

Perceptual Factors:

Perceptual map

High-End market is the common target for 5 star rating hotels. At this level they

compete for excellence as well as provision of high value perception. To compare Dusit

Thani and its competitors the main indicators of success in comparison are luxury and

satisfactory ratings. Luxurious services is expected and often compared between 5 star hotels.

Luxury is one aspect, but the price that comes with it must be compatible with the services

provided to give the customers good value for money.

Dusit Thani is an original Thai 5 star hotel chain. With 60 years of experience they

build their brand behind luxury. Dusit International also holds the original Thai Hospitality,

which has become world famous in today’s world. Dusit Thani makes attempts to update

themselves with new technologies to better serve the guests to satisfy their needs by studying

today’s demand. For example; today’s research shows that Internet is the single most used

11

invention and majority of the guests are happier with a good Internet access service. Dusit

Thani Manila provides just that WI-FI service throughout the hotel with advance technology

that allows users to access it at a very high speed. Dusit Thani also provides lower price

compared to their 5 star hotel competitors. Dusit Thani will charge a lower price but their

luxury will be close to their competitors.

On the other hand, their close competitor like four season provide state of the art

quality technology as well as constantly updated technology and design. For example the

tough screen iPad device installed in Four Seasons Toronto. Therefore, Four Seasons will run

close to Dusit Thani on luxury scale but charge higher price in comparison.

The next brand is Intercontinental. Intercontinental has a century worth of experience.

According to trip advisor ratings they provide excellent luxurious experience. They will rate

high in luxury but between Four Seasons and Dusit Thani in terms of pricing.

The final direct competitor is St Regis. They also have a 100 Years of experience.

They have unique tradition and culture that provides outstanding atmosphere. Their services

performance is considered remarkable. Their satisfaction rate is quite high. Therefore they

will be rated as highest in luxury and also highest in pricing.

12

Dusit Thani has divided customers in to four big group aspects by their

characteristics

The first group that Dusit Thani tends to target on is the company. The company is the

group that has high expectation of service quality and in return they are willing to pay

at the premium rate.

The second group is the Government officials and embassy. Dusit will provide this

group with rate that is lower in comparable with the first group.

The third group is the travel agencies and the airlines. This group will be charged

much lower than the above two groups.

The last group that Dusit Thani tends to target is from conference or meeting. Due to

intense competition, Dusit Thani will offer this group the same rates as the airlines

and travel agencies group.

2. Industrial Markets

An industrial market involves one business dealing goods or services to another

business instead of a consumer base. Also known as the business-to-business market, this

market encompasses three distinct variations, including businesses selling goods, businesses

selling raw materials and businesses selling services. Each of these three happens in a variety

of individual businesses. There are many advantages of this type of market over the

traditional consumer market (Industrial Market, n.d.). The industrial market focuses solely on

the goods and services provided for producing a separate end product. This is an

organizational market with its own advertising, distribution and sales. From automobiles to

food, clothes and more, consumer industrial products would not be available without the

industrial market first being utilized.

There are two companies that Dusit Thani has coordinated with which are Airline

companies and Travel Agency.

Airline:

There are many airline companies that Dusit has coordinated with which includes

Singapore Airlines, American Airlines, Thai Airlines, Korean Airlines, Bangkok Airways,

Kingfisher Airways, Air France and Alaska Airlines. The reason that Dusit Thani partners

13

with these airline companies is because when customer travel they would even search for an

accomodations where it’s well secured and also up to their expectation. Also, it is a

continuous process because after the customer reaches a particular destination eventually they

would like to have a good accomodations. However, this provides benefits to both the hotel

and the airline companies as eventually they will depend on each other to service customers

and, therefore, this way can help generate revenues to both the companies. To illustrate, for

the company to join hands with airlines, thus customers will earn 500 Mileage Plan miles at

the participating Dusit International hotels and resorts (Dusit International, n.d.).

Travel Agency:

As Dusit knows the importance of keeping relationship with travel agencies around the world

which will allow them to access to large base of customers. Therefore through the use of

effective Global Distribution Systems or Computer Reservation Systems of such as

GALILEO, SABRE, AMACEUS, and WORLDSPAN (Dusit, n.d.), Dusit will be able to

connect with large number of travel agencies around the world who also use these systems.

The travel agencies around the world would act as the agent in dealing with our customers

around the world and help selling our hotel rooms. These agencies are able to sell hotel

rooms for us at the cheaper price as the room price is supplied to them at the discounted rate.

These include online travel agencies such as Agoda, Expedia, Voyages-sncf.com,

Travelocity, Orbitz, CheapTickets, and World Hotel-Link.Once the travel sites sell a hotel,

the site will try to get a confirmation for our hotel from the customers. That is the reason why

14

Dusit has to keep up with effective global distribution system in order to access to large

number of customers around the world (Dusit Thani, n.d.).

Generic business- level strategies of DusitBusiness level strategy is defined as the approach taken by an organization to compete

in its chosen markets. A business level strategy can be competitive - battling against all

competitors to secure competitive advantage or core competency. If the primary determinant

of a firm's profitability is the attractiveness of the industry in which it operates, an important

secondary determinant is its position within that industry. Even though an industry may have

below-average profitability, a firm that is optimally positioned can generate superior returns.

A firm positions itself by leveraging its strengths. Michael Porter has argued that a

firm's strengths ultimately fall into one of two headings: cost advantage and differentiation.

By applying these strengths in either a broad or narrow scope, three generic strategies result:

cost leadership, differentiation, and focus. These strategies are applied at the business unit

level. They are called generic strategies because they are not firm or industry dependent.

15

The target scope of Dusit Thani Company is broad market, as Dusit has seven products and

services, each of products target different market segment.

I. First is the Dusit Thani hotels and & resorts that tends to target on business travellers

as this is because they provide all the requirements for business travellers which

includes internet access, preferably free wireless broadband access, free long distance

calling over the Internet and since usually business travellers are busy with their

meeting schedule, thus this hotel provides room service that can offer hot food or

coffee at a specified time where other Dusit brand might not focus on providing these

services.

II. Second is the Dusit Princess that tends to target on middle class businessman and

Dusit Princess provide all the requirements for middle class businessman such as

quality hotels, luxury travel, signature restaurants and high-end retail.

III. Third is the Dusit D2 that tends to target on new generation travelers. This is because

as now the new generation travelers want choices and flexibility. They don’t want to

choose between a meeting room and a restaurant/ bar on the local scene to meet up

16

with business colleagues. Therefore, to meet these travelers expectation, Dusit D2 is

accelerating the roll out of its great room lobby experience that offers comfort, style,

convenience and entertainment for the new generation of travelers.

IV. Fourth is the Dusit Devarana target on people who pursue balance in life. Dusit

Devarana is designed to provide its guests with an environment where they can detach

and de-stress in order to recharge and have the ability to reconnect with everyday life

having an empowered body and mind.

V. Fifth is the Dusit Residence tends to target on long stay businessman, travelers and

foreigners. As Dusit Residence provides well equipped facilities that attracted long

stay travelers to stay longer at the hotel. Thus, Dusit Residence provides facilities

such as fitness center and spa to draw their customers to stay longer and this can help

the hotel generate more revenue from these groups of customers.

VI. Sixth is the Educational business, Dusit Thani College and Le Coudon Belr target on

students who are interested in hospitality industry.

VII. Seventh is the Devarana spa that targets both Thai and foreigners on high end

markets. Devarana Spa is one of the products that are being known and are popular

for Dusit Thani loyal customers. Since Thai spa has been recognized as one of the top

five services in the world and the foreigners tend to spend a lot of money on spa

especially for the Europeans guest which is one of the target customers of Dusit

Thani.

Analysis

Dusit International tends to focus on both short haul and long haul customers. Dusit

Thani target short haul customer that are both local and international people who travels to

the destinations for business purposes in a short period of time. However, they also prefer to

stay in the luxurious hotels. In addition, Dusit target long haul customers from all around the

world where these customers tend to come for traveling and exploring new experiences at the

destinations that Dusit is situated at. As a result, Dusit Thani tend to not focus on specific

17

niche market as they tend to target many target market based on each types of products. Thus

we can conclude that the target scope of Dusit Thani Company is broad market.

Value Chain Activities

Value is the chain of activities for a company that operates in a specific industry. The

value chain framework can be used as powerful analysis tool for the strategic planning and to

build the organizational model ensuring an effective leadership model. The value chain

concept can be applies also in the individual business unit and can be extended to the whole

supply chains and distribution networks. To form a successful product for an organization it

is important to add value in each activity that the product goes through during the life cycle.

The best possible value can achieve in the product development process by adding value in

each stage. Therefore, it needs a combination of value chain activities and a proper

synchronization among all the related activities. A proper organization is required that

contains all the required functional departments to perform these activities and a proper

communication approach is required to synchronize the activities of these functional units

efficiently (Saha, 2012). According to Michael Porter value, he suggested that going through

the chain of organization activities will add more value to the product and services than the

sum of added cost of these activities. As a result, the company will gain marginal value for

that product or service. If these activities run efficiently the company gains competitive

advantage on the product or service.

Additionally,hotel industries that wishes to outperform its competitors is by using a

differentiation strategy through differentiating itself by offering higher and unique quality

will perform its value chain activities better than their competitors. On the other hand, hotels

might use a different strategy that is cost leadership strategy. This strategy will require a

reduction in the costs associated with the value chain activities, or a reduction in the total

amount of resources used. As a result, the hotel industry can link its value chain activities to

Competitive Advantage.

Influential work by Michael Porter suggested that the activities of a business could be

grouped under two headings:

18

(1) Primary Activities - those that are directly concerned with creating and delivering a

product (e.g. component assembly); and

(2) Support Activities, which whilst they are not directly involved in production, may

increase effectiveness or efficiency (e.g. human resource management). It is rare for a

business to undertake all primary and support activities.

Primary activities can be classified into product related and market related activities

which are described below:

Product related activities: The activities that the organization performs to add value

to the products and services itself. The activities are classified as:

1. Inbound logistics: For the production and development activities, organizations

need inputs as goods which are received from the suppliers. Inbound logistics

refer to all the activities related to receive goods from the suppliers, decision about

the transportation, scheduling, storing the goods as inventory, managing the

inventory, and make the inputs ready to use for the production of end products.

2. Operations: These include the production process, development activities, testing,

packaging, maintenance, and all other activities that transform the inputs into

finished product.

3. Services: Organization offers the services after the products and services have

been sold. These service activities enhance the product’s value in the form of after

sales guarantees, warranties, spare parts management, repair services, installation,

training etc.

Market related actitivies: The activities that the organization performs to transfer the finished

products or service to the customers.

1. Outbound Logistics: The finished products are developed using the product

related activites. Now activities are required to transfer the finished products to

the customers via warehousing, order fulfillment, transportation, and distribution

management.

2. Marketing and Sales: These activities include the advertising, channel selection,

product promotion, selling, product pricing, retail management, etc. The activities

19

are performned to maje sure that the products are transferred to the targeted

customer groups. Marketing mix can be an instrument to taje the competitive

advantage to the target customers.

Support activities: The activities that the organization performs to assist the primary

activites to gain the competitive advantage. The activities are classified as:

1) Procurement: This is the purchasing activity of the inputs to transform these

into finished products or services. Procurement adds value by the acquisition

of appropriate goods or services at the best price, at the right time, and in the

desired place with the desired quality and quantity.

2) Technology Management: This is very important in today’s technological

driven environment. Technology can be used in production to reduce cost, to

develop new products, increase customer service quality, build up cost

effective process. It supports the value chain activities such as research and

development, process automation, process design.

3) Human Resource Management: The key roles of HR are to support the

attainment of the overall strategic business plan and the objectives. As a

strategic business partnet HR designs the work positions by hiring,

recognition, reward, appraisal systems, carrier planning and employee

development. They act as an advocate of the employees to motivate them and

create a happy working environment. For the organizational changing

situation, HR executed the strategic needs of the organization with minimum

employee dissatisfaction and resistance to change.

4) Infrastructure: This includes the planning management, legal framework,

financing, accounting, public affairs, quality management, general

maangement etc. These are required to perform the value added activites

efficiently to drive the organization forward to meet the strategic plan and the

objectives.

After we analyze both the primary and supporting activities of Dusit Thani Company,

we found that Dusit Thani use integration strategy to manage value chain as a whole in its

industry. As a result, Dusit Thani used both Cost leadership and Differentiation strategy in

some business and in some of their activities.

20

Primary activities

Supply chain managementThe first primary activity is Supply Chain Management. It focuses on the

management of supply chain activities to help to take advantage of customer value and attain

a sustainable competitive advantage. It represents effort by supply chain firms to develop and

run supply chains in the most effective and efficient ways possible. Supply chain activities

focus on product development, sourcing, production, logistics as well as the information

systems needed to coordinate these activities. In addition, there are higher competition and

customer expectations in the supply chain market in areas such as product availability and

flexibility in operation, due to many companies focusing on how their supply chain can make

them competitive in the market. Supply chain management are usually used at operational,

tactical and strategic levels in the retail, automotive, health care and manufacturing industries

However, as we are focusing on the hotel industry. The hotel industry can benefit from the

comprehensive and integrated practices of supply chain management, by delivering a

consistently reliable and high quality service at the best costs. Therefore, this implies that the

supply chain management is successful when the goal of getting the right product to the right

customer at the lowest costs is achieved. This is a situation that will give the highest level of

service to the customer and higher competitive advantage to the company. Thus, supply chain

management touches on the mixture of different supply chain activities to help maximize a

company’s profit and total value.

21

In addition, there are higher competition and customer expectations in the supply

chain market in areas such as product availability and flexibility in operation, due to many

companies focusing on how their supply chain can make them competitive in the market. For

example, hotel industry is highly competitive especially in Thailand where they are over

supply of accommodations and this leads to price war. Therefore, the key strategy that can be

used to keep them competitive is by using the cost leadership strategy. A cost leadership

strategy is based upon a business organizing and managing its value adding activities so as to

be the lowest cost producer of a product or services within an industry. A successful cost

leadership strategy is likely to rest upon a number of organizational features. Attainment of a

position of cost leadership depends upon the arrangement of value chain activities. Therefore,

companies pursuing a low-cost strategy will typically employ one or more of the following

factors to create their low cost positions such as economies of scale, outsourcing,

technological advantages etc (Clark, n.d.). Moreover, a hotel has various types of product and

therefore, they need different suppliers to supply them with the materials. For example, food

service equipment, food and beverage, cleaning, design, architect, construction and clothing

etc Since Dusit Thani has been established for quite a long time and had built a strong

relationship with the suppliers, creating loyalty towards each other and is able to bargain for a

cheaper price from the suppliers. Therefore, these suppliers have a low bargaining power to

these hotels since they rely on these powerful hotels to keep their business running. As a

result, it is very easy for Dusit Thani hotel to bargain for cheaper price this is because

everyone want to supply to them as they will eventually need to supply to many of its chained

hotels too. There are some products that Dusit hotel need to buy in large amount such as

mattress, guest amenities so Dusit is able to negotiate with suppliers at a cheaper price.

Furthermore, it is the customers that receive the hotel products and services. Since

hotel industry is highly competitive and thus they need to deliver exceptional services to their

customers in order to meet up to their expectation and thus when customers are satisfied with

the product or service they received they tend to become retained customers and thus creating

customer loyalty. For example, Dusit Thani hotel has developed memberships and loyalty

program to attract the repeated customers to come stay and use the service at their hotels and

not the competitors (Dusit International, n.d.).

Dusit Loyalty Programs are divided into three categories. Firstly is the Dusit Gold

Card Program. Customers that receive a Dusit Gold Card can be recognized as one of our

most values guests that are entitled to Dusit Golden Privileges and Benefits. The guest will

22

receive priority room reservation, special room rates, VIP recognition, welcome drink,

complimentary fruit basket, express check-out, saving on laundry and restaurants and

guaranteed late check-out until 2 pm. In addition, if the guest travel for business or leisure

purposes and carries Dusit Gold Card can enjoy the benefits and privileges in some branch of

the hotels in Thailand such as at Dusit Thani, DusitD2 and Dusit Princess Hotels & Resorts,

where they will ensure the delivery of an experience that enlivens the individual spirit no

matter what they journey.

Secondly is the Dusit Executive Club Program (DEC) which is designed specifically

for our valuable members who are the secretaries and reservation makers for Thai- based

commercial firms, embassies and government offices to enjoy exclusive privileges and

rewards at all participating Dusit Thani, DusitD2 and Dusit Princess Hotels and Resorts

throughout Thailand. All bookings at the company’s applicable corporate rates will enable

the guest to earn Dusit Stars which can later be redeemed for a wide range of rewards.

Therefore, whenever the guest become a member then they can enjoy the benefits and

privileges offer by the hotel such as guest can reward themselves with a complimentary night

stay if customers have 1,200 Dusit stars. Also, if customers receive 2,300 Dusit stars then

they can relax and rejuvenate themselves with Devarana Spa and if they have 1,200 Dusit

stars then they can use d’spa service for free and earning 500 Dusit Stars can use Namm Spa.

Customer also receive a special 10 percent discount for the room booking via Dusit best rate

for their friends and families, 10 percent at participating restaurants, 10% discount on Dusit

products at Dusit Shop throughout the year.

Thirdly is the Dusit Wine & Dine (Thailand). Dusit Wine & Dine has been categorize

to Thai Resident Membership and Manila Membership. For Thai resident membership, being

a member of Dusit Wine and Dine, customers will receive the most exciting and exclusive

accommodation and dining benefits at all restaurants and bars across participating Dusit

Thani, DusitD2 and Dusit Princess Hotels and Resorts in Thailand. Also, the guest will enjoy

special room rates, 15% discounts on a la carte spa treatments at Devarana Spa located in

Bangkok, Hua Hin, Pattaya, Chiang Mai and Manila. For this customers just have to pay

6,900 baht for a membership fees and once they want to renew the program they have to pay

6,500 baht for the following year. For Manila membership, customers will be treated as VIP

member to be able to enjoy food, beverage and accommodation benefits and discounts at

participating hotels & resorts not only in Manila but also in Thailand; such as Dusit Thani,

DusitD2 and Dusit Princess Hotels & Resorts. In addition, the guest can enjoy discounts at

23

the Devarana Spa- Dusit own branded and signature Spa for the ultimate pampering,

relaxation and rejuvenation experience.

Fourthly is Dusit Thani Freehold & Leasehold Property Fund (DTCPF) Prestige card

entitles DTCPF unit holders who have invested one million baht or more on Dusit Thani

Freehold & Leasehold Property Fund. The investors will receive privileges and benefits

offered Dusit International Hotels & Resorts in Thailand and overseas. For example, the

investor will receive 10% discount on room rates from Dusit Best Rates, a 15% discount from

restaurants and special saving from Devarana Spa, DFiT, Le Cordon Bleu etc.

Lastly, Dusit also has Frequent Flyer Programs. Dusit has alliance with more than five

airlines such as Japan Airlines, American Airlines, Alaska Airlines, Thai Airways, Bangkok

Airways, Jet Airways and Singapore Airlines etc. Customers will receive award miles per

qualified stay. For example, customers will receive 500 miles per stay at Dusit International

hotels and resorts.

The purpose of the membership and loyalty programs is to attract large number of

customers to be members of their program. As a result, from the membership and loyalty

program, it can attract loyal guests to use the related products of Dusit Thani and also attract

repeated guest to use the service often such as spa, restaurant and laundry service. This helps

hotel to generate revenue during the low season. To illustrate, there were around 7000 people

who were the membership of Dusit wine and Dine in 2011 (Dusit annual report, 2011).

However, loyal customers are not offered much different service from regular guests. For

example, both type of guest receive complimentary fresh fruit, welcome drink, and express

check- out, savings on laundry and restaurants and guaranteed late check-out until 2pm.

On the other hand, when comparing to our direct competitors that is Shangri-La, they

tend to focus a lot on quality than quantity that is to ensure they deliver exceptional services

to their guest. Their main priority is to ensure highest level of guest satisfaction because when

the guests are happy and satisfied with the service they receive they are likely to come back

and use the service again in the future. Shangri-La has the Golden Circle Programme that

offers three membership levels which are Gold, Jade and Diamond. Each level brings its own

recognition and privileges that will make guest feel right at home. First is the Gold

membership. For guest to become a member and receive Gold card they need to stay at least

10 nights at Shangri-La hotels. The benefits that guests can receive are that they have a

choice between GC Award points or airline miles for each eligible stay and will receive cash

24

advance of USD 250 per stay. In addition, guests that earn one Golden Circle award point for

each dollar they spend, and 500 points customers will get a $50 food and beverage voucher,

800 points will entitle to a room upgrade and 1000 point will get to stay a few night. Second

is the Jude membership. Jude members need to stay at the hotel for at least 20 nights. Thus,

guest will receive priority upgrade to the next available best room category, even if the

reserved room type is not available at check-in and their partners can stay free with

applicable breakfast benefit. Lastly is the Diamond membership. Diamond members need to

stay more than 50 nights at the hotel. Guest can have 24 hours concierge services for non-

staying guests. Therefore, each category will be offered service according to the types of

membership.

Based on the research that was conducted Shangri-la hotel has benefited a lot from

developing this membership and loyalty program and one of the benefits that they received

was that they can cut down some of their cost and this help to generate more revenue for the

hotel and especially during low business where they can keep their business running well and

hence increase profits for the company. For example, Shangri-La hotel has cut down their

cost by reducing their promotion and advertising cost. This is because Shangri- la hotel tend

to target mostly on loyal customers rather than everyone who come and stay at the hotel

(Kester, 2010). Moreover, Shangri-La hotel use the most vital strategy which is Customer

Relationship Management (CRM). Shangri-La needs to be more creative and be able to

differentiate from other hotel chains, because competition is increasing very quickly. CRM is

all about collecting customer data and creating a customer profile. As a result, this allows all

hotel employees to remember their loyal customer’s needs preferences and behaviours. This

makes the guest feel important and special when they are recognized and therefore makes

them impressed by the service that they receive. As a result, the company has information

about the their loyal customers so they can send the advertisement and various types of

promotions that are being offered by the hotel to their loyal customers because it ensures to

the hotel that these customers will be interested in the promotions and that hotel offer and

they are chances that their loyal customers will come and use their service instead of

25

spending a lot of money on advertisement and promotions on every people where there is no

guarantee that they will our retained customers. Furthermore, Shangri-La hotel tends to target

on their loyal customers and they will be willing to pay a premium price for a high service

quality. So when the hotels are offering high service quality then the customer will have low

bargaining power as they are willing to pay at a high price as they value the service. As a

result, Shangri-La hotel can reduce their cost and at the same time generating more revenue

for the company.

OperationThere are a number of ways that Dusit can reduce its operating cost. One of the

reasons is that the company has many products, and the company can easily reduce its

operating cost as each product can share resources. To illustrate, Dusit can share same

resources and also customer can use another product of Dusit Thani. Products such as Dusit

D2, Devarana Spa and Dusit Thani hotels and resorts which are five star hotels. This is

because Dusit Thani has shuttle bus service where customers can travel easily from the

branch of Bangkok to Pattaya, Huahin etc. One of the expenses that Dusit Thani has reduced

is in terms of advertising that is instead of advertising separately; they advertise all of their

products together. Dusit Thani tend to share ads, posters and above the line marketing.

Additionally, Dusit has many products so they instead of ordering and producing their

product separately, they tend to order all at the same time where they can get at a cheaper

rate. The other expense that Dusit can reduce is that they share equipment. For example,

Dusit Thani hotels use the product of Devarana spa as amenities in guestrooms. Moreover,

the spa that was located at Dusit Thani Hotel can reduce expenses of leasing or buying a

property. As a result, Dusit has a number of ways to reduce some of its expense and share a

lot of their resources together in terms of their operation process.

26

DistributionHospitality industry usually uses different channel for the distributions including

distribution through other properties, or even through their own chains or even using third

party for outsourcing on their behalf. Most of the hotels now use travel agents, tour operators

and incentive houses as their channel of distribution. Therefore distribution channel can be

defined in simple words as medium for customers to get sufficient information about the

desired product or services at the right time. Nowadays hospitality industry is making use of

electronic distribution channels widely. However, in the past most of the companies tend to

reply on traditional distribution channels such as reservation office, call centre, or reserve via

travel agency. Traditional way of distribution channel is very inefficient and expensive

especially for the hotel industry and it also consumes a lot of their time as they have to run

back and forth to the reservation office. To illustrate, hotels needs to pay commission rate of

about 10% to 25% when they make reservation from travel agency or intermediary. Thus

those hotel industries that rely on traditional distribution tend to have a very high operating

cost. Currently now most of the hotels tend to focus on online distribution channel is because

the usage of internet in hospitality industry can be used as a major marketing and

communication tools in this business world. Many of the hotels now have started using e-

commerce as their business tool. They also started to redefine their roles and operations in

order to provide better service to the changing needs of customers (Harketi, 2011). To

illustrate, Dusit Thani International also focus on online distributional channel and Dusit is

using electronic (e-distribution) channels in order to be able to provide better and faster

27

services to customers. As this will help increase the profitability to both customers and Dusit

to build a better relationship between them. Dusit International ensures that their brand is on

the top ranking of search engine and they had enhanced their Search Engine Optimization

system for its own website that is www.dusit.com since 2008. Additionally, Dusit tried to

remove all language barriers by as they provide all forms of languages for their target

customer including Japanese, Chinese, Thai, Arabic and English. Dusit Thani had expanded

more distribution channel via online travel agency. This is because online travel agency has

become the most popular way for the travellers to book the hotel as it saves a lot of time and

money and they can help access the information that will best meet the customers need and

wants. Based on the research on Dusit Thani, they aimed to increase the overall online

booking from 12 percent in 2012 to 25 percent in 2013 (Dusit International, n.d.).Nearly 74

percent of the consumers are looking for hotel will visit online travel agency to make their

booking decisions and just about 10 percent of consumers that go directly to the Dusit Thani

hotel websites. Therefore, online travel agency can help hotels sells their room easily and

more conveniently and also there is high chances that customers will make booking through

online travel agency. As a result, Dusit tend to focus only on online distribution channel as it

help the company in reducing their distribution cost and to attract more customers to book

their hotel.

MarketingMarketing has become an important aspect of hospitality because it helps people in

the industry to understand their customers. Marketing help both managers and leaders in the

hotel industry to understand who their customers are and how to satisfy them. It allows the

company who successfully uses marketing, to compete in the marketplace. Therefore, the

28

most important goal for any business, especially in the hospitality industry is to recognize and

please customers (David, 2010).

Dusit Thani has join partnership with city bank to use their media channel and get access to

all their customers. City bank will send a text message to all their customers informing them

about the company’s promotion and special offering. For that Dusit Thani has to pay 10

percent to city bank. This is one of the ways that Dusit Thani does the marketing for their

products and services. As a result, more customers are aware about the products and the

services that are being offered by Dusit Thani. By this way, it will help company to reduce

their expense and also create more awareness amongst customers. For example, during last

year October 16, 2012, city bank promoted Dusit Thani Bangkok Wedding Fair 2012 to all

their customers by sending a text message informing them of the wedding fair which was

going to be held on October 28. Thus,

this creates awareness amongst people

and they were also interested to visit

the wedding fair. Another example is

that on the February 1, 2013 Dusit

Thani joins partnership with EASY

FM 105.5 Valentine’s surprise by

Dusit Thani Bangkok radio spot to

promote about their Valentine Dinner

at Il Cielo restaurant from 1st to 15th of

February. As a result, this is the way

Dusit Thani did their marketing and creates awareness amongst people.

29

30

Moreover, in terms of spa business, Devarana

Spa is one of the products that are being known

and popular for Dusit Thani loyal customers.

Since Thai spa has been recognized as one of

the top five services in the world and the

foreigners tend to spend a lot of money on spa

especially for the Europeans guest which is one

of the target customers of Dusit Thani. In addition, the competition of spa business has

become very intense so Dusit Thani tends to differentiate its spa business from their

competitors by having their own unique massage program. The company offers a variety of

massage program for the guests such as body treatment, facial massage, body massage and a

lot more for customers to choose. Moreover, to differentiate itself from the competitors, Dusit

Thani has created their own spa products by bringing the best quality of ingredients to

produce the botanical spa collection which

includes body care, oil blends and heaven scents.

Each of the products has the Devarana spa

trademark stamped on the packages.

Furthermore, one of the signature treatments is

called the Devarana treatment. This soothing

treatment comforts the skin and uplifts the mind.

It includes Devarana Bath and Devarana Body

Scrub and Devarana Massage that combines strong pressures of Thai, Ayurveda and Shiatsu

techniques with Swedish and aromatherapy to offer the best experience and the most relaxing

moment for the customers. As a result, the company tried to differentiate themselves from

other spa business by offering their unique spa treatment and spa collection. Also, Dusit

Thani received the awards for being the best luxury spa group at World luxury spa awards

2012 for offering the best spas and spas brand worldwide. As a result, the contemporary Thai

design and decor invite guests to transcend the everyday world, providing a relaxing and

welcoming atmosphere in which to enjoy premium spa treatments with traditional Thai

service and hospitality (Dusit Thani Hotel, 2012).

Furthermore, the company has developed the Pelican System’s e-brochure which

helps Dusit Thani to present their company’s profile, product and service and made it

accessible by the global market at any time. Thus, the company benefited a lot in terms of

31

cost saving that is paperless e-brochure reduces the printing costs and it is also much more

convenient as it could be send to anyone who has internet access, at any time of the day.

Also, it is much easier for the company to make any update and changes about hotels

publication materials promptly and efficiently without re-printing the material. Thus, the

company tends to reduce the cost of advertising and publishing (Pelican System’s E-

Brochure, 2010). Moreover, Dusit Thani is able to promote its brand to a wide range of

market. The system allows e-brochure file in PDF format (max. 300kb). As it is important to

boost up the company and yet they are doing it environmentally friendly, time and cost

efficient. Also, Dusit Thani will use the Digital Private library via the www.lenoardo.com.

By using this program, the company can send images, videos etc via online channel and the

company might not have to pay for using this program. Thus, this program is used for storing

and distributing all the digital images of the company. As a result, the company can reduced a

lot of its expense by engaging in various forms of distribution. An example is of Grand

Ocean View Hotel e-brochure.

32

Follow up serviceFollow up service is one of the effective tools to increase customer’s satisfaction and

providing exceptional experiences to customers so follow up service can make the company’s

brand outstanding from other brands. Dusit has been awarded for customer relationship

management as it has established a great customer relationship, including the introduction of

new product and improved products and services, innovation, quality of customer contacts,

transparency, availability of information and loyalty programs. To continuously improve our

ability to delight our guest, Dusit have introduced an online satisfaction survey that allows

them to measure customer satisfaction on a daily basis. This survey consists of special thanks

words to guests with questionnaires in order to ask the customers to fill in the evaluation

forms of the overall satisfaction of the products and services of the hotels. Then based on the

survey, Dusit will keep track of all the complains and compliments from the customers and

will also make the result obtained from the customer in statistics form. According to statistics

that 92% of guests were either satisfied or fully satisfied when staying at Dusit.

Additionally, Dusit International wants to differentiate their product

and services from other competitors. As when they received complain

from customers and instead of simply ignoring complain they try to

improve the performance from complaints received by customers after

they have finished using the service of Dusit Thani. This was the way

that Dusit can use to reduce the service failure. Moreover, when any employees of Dusit

receive complaints from any of the customers, they will be first be bought to the attention of

the senior management who will designate a managerial staff member to conduct an

independent inquiry into each complaint with a view to recommend follow up action.

Therefore, for Dusit to achieve goal of perfection, they need to implement an action plan in

order to solve all of these imperfections and it can be seen that follow up service is very

important tool for the company. As a result, the follow- up service in the hotel industry is an

essential tool to evaluate the effectiveness of the product and the satisfaction of the

customers.

33

Supporting Activities

FinanceFor the nine-month period as of 30 September 2012, Dusit Thani had net loss of Baht

120.02 million. The main reason loss resulted was from the operation loss of DTMD of Baht

189.74 million and increased of financial expenses of DTMD of Baht 35.66 million.

Afterattributed net loss to non-controlling interest, net loss of the Company was Baht

10.56million. The major expenses increased resulted from Company’s financial expense and

administration expenses, since the number of employees and foreign – executives increased

in order to expand the Company’s business (Report Performance, 2012).In addition, Dusit

Thani wants to ensure that its staff have all the necessary knowledge, skills and

competencies and that the staffs needs to be trained for performing excellently in their current

jobs and future responsibilities. Therefore, they invested US$100,000 on 6 month Mini

Master of Business Administration (MBA) programme in Hospitality Management to provide

their executives who have the potential to take on future senior leadership roles in order to

assist Dusit International’s global expansion. Therefore, they have higher expenses to invest

in the new course of educational business (Dusit International, n.d.).

Moreover, Dusit Thani College which is now becoming the leading center of

hospitality learning regionally has initiated a programme with Lyceum University in the

Philippines and open a new program in overseas such as in Batanga, Manila and Laguna.

Therefore, this increases the expense for the company as they had to pay five percent each

year for trademark or intellectual. Also the firm had to pay another four percent of net profit

for advisor expenses (Dusit Thani, n.d.).

Furthermore, in terms of Spa business, Dusit Thani had plan to expand its spa market,

so they have invested in long-term investment to expand Spa business to countries such as in

Europe region. Therefore, Dusit Thani launched the first spa business in Europe. They have

invested in Devarana Spa for about 15 million Euros at the new ultra-luxury hotel IL

SALVIATINO-Florence in June 2009 (Dusit International, n.d.).

Additionally, Dusit Thani has quite high due to its expansion in Maldives. However,

the company wanted to reduce all other unnecessary cost such as financial expenses. As a

result, the financial expense of the company was reduced from 2010 to 2011 which was

around 46 million to 20 million.

34

To sum up, Dusit Thani wants to differentiate itself from other competitors in terms of

education and spa business. Dusit wanted to open its new program aboard by corporating

with Lyceum University in the Philippines and also they have expanded their spa business to

Europe to be better known amongst people.

Human ResourcesHuman resources capabilities play a major role in strategy implementation and

becoming more actively involved in the strategic management process. Especially in

hospitality industry where the quality of staffs would directly effects the quality of service

provided to the guests.In order to support Dusit International's expansion Dusit sees the

importance of providing the best education to staffs from basic to top-level knowledge to

develop its capabilities. Therefore, Dusit International uses the human resource to

differentiate themselves from other competitors.

Firstly, Dusit International differentiates itself from other competitors in terms of core

service design. From the architecture and interior design that displays traditional Thai

artwork to facilities that surpass the highest expectations of modern hospitality. Dusit tried to

enriches customer’s unique experience by creating Thai culture and tradition. So from the

start itself Dusit Thani website (www.dusit.com) is designed in a very Thai traditional way

where the guest can see on the Dusit Thani homepage is the Thai traditional dressing worn by

the Dusit staff which gives customers a sense of Thai culture. Therefore, the performance of

every staff needs to be related to the theme. Thus, when the employees interact with the guest

it should represent the Thai traditional way to impress the customers.

35

Secondly, Dusit ensure that all hotel staff needs to have all the necessary knowledge,

skills, and competencies and that the staffs are being developed for performing excellently in

their current jobs and future responsibilities. Therefore, Dusit Thani hotel has developed and

manage a high performance human resources training and development programs employees

by conducting various training courses based on different levels of work experience such as

new hire training for departmental head level, and manager level, and personal development

course that enables the staff of Dusit hotel to continuously learn and acquire new skills and

competencies that enhance performance and productivity employees (Human Resource

Development, n.d.). Also they tend to have a good teamwork of staffs and all their staffs is

committed to their and they put in 100 percent effort. Moreover, Dusit Thani also has

management trainee program in order to find the best newly graduated students to work in

Dusit international hotel and resort across region. The candidate will be selected through

strict process to attend program. The course contain sales & marketing, public relation, F&B,

reservation, human resource, catering management and others. For three month, the candidate

will learn about overall hotel management. For another nine month, the candidates can

actually practice in the hotel chain to learn new experience from each department. The

outstanding candidates will be chosen to work further in expert field (Dusit annual report,

2012).

36

Furthermore, Dusit Thani differentiates their human resource from the competitors by

providing MBA Program. Dusit Thani invests US$100,000 on a six month Mini Master of

Business Administration (MBA) in Hospitality Management to provide their executives who

have the potential to take on future senior leadership roles in order to assist Dusit

International’s global expansion as Dusit recognizes the importance of talent development so

that the participants can keep their company competitive. In this program, twenty nine

participants are selected from all departments such as Human Resources, Food and Beverage

department, Rooms division, Sales and Marketing. The course consists of subjects which are

included in hospitality management which are Managing Human Resources and Leadership,

Marketing Management, Managerial Accounting and Corporate finance (An international

marketing strategy analysis, n.d.). This program was developed by one of Asia’s finest

Hospitality institution which is Dusit Thani College and Dusit Executive center. The course

containing intensive top-level executive training courses and customize program. As this

course could help broaden their vision and the hospitality best practices which will also

support them to progress in their profession. Therefore, Mini Master of Business program

focus on developing their human resource based in Thailand, so there is a great opportunity

for Thai executives to express their capabilities to compete in global market. As a result

employees who work for the company for a long time might be able to identify their strength

and can work to improve on their weaknesses. As a result, they can work effectively to help

improve the performance of the company. Finally, Dusit Thani also differentiates their human

resource as they have worked with Investors in People (IIP) where they provide Dusit with a

frameworkto address structured change within HR department and also the hotel as a whole.

The structure change allows the staffs to have better communication with top management.

As a result, Dusit have a much more vibrant team, empowered and willing to engage. This

allows them to have improvement in staff retention and profitability of the hotel (Dusit Thani

Hotel, 2011).

37

Management Information System

Information systems focus on the information available within the supply chain. Dusit

use Opera Central System Solution to distribute information about customer reservation right

away to every Dusit hotel. The system includes Opera Reservation System (ORS), Opera

Customers Information System (OCIS), Opera Web System (OWS), and Opera Sales Force

Automation (SFA). By using this information system, this would allow each Dusit

international hotel chain to directly connect to every customer through all distribution

channels globally such as travel agency, online booking, hotel website and telephone. As over

500,000 travel agencies worldwide would be able to access to the hotel’s Opera Central

Reservation system this can also lead to the increase in reservation volume and gain more

market share worldwide. Moreover, the hotel would be able to respond to the customer’s

andgive out information about their reservation right at the moment the customers make

reservation. This can help the hotel to save time, unnecessary costs as well as ease of

complex procedure for both hotel and customers (Opera Central System, 2009).

38

Analytical Idea

Dusit Thani operates their business level strategies in both differentiation and cost

leadership strategies. However, we considered Dusit Thani as mainly in cost leadership

strategies because they focus more on operating hotels in economy scale. We think that Dusit

Thani is using business level strategy which is integrated between cost leadership and

differentiation. For primary activities, Dusit Thani has managed its supply chain management

as a whole by cost leadership strategy by the implementation of IT applications in the supply

chain management process which help Dusit Thani to exchange data electronically with the

other partners of the supply chain which have reduce much of their expense and also by

providing loyalty program to their customers which helps the company to generate revenue

even during the low season. In terms of operations, Dusit Thani has reduced its expense by

sharing of resources such as advertisement and equipment. However, in terms of distribution

channel, Dusit Thani tend to focus a lot on online distribution channel such as E-distribution

channels as it has provide better and fast services to customers which leads to customer

satisfaction and also enhance profitability to both customers and the company as a better

relationship are built between them and also reduce a lot of its unnecessary cost and

expenses. For marketing, the company tried to reduce its advertising and publishing expense

by distributing e-brochure instead of sending direct mail. However, for differentiation

strategy, Dusit Thani has used customer relationship management as it has established a

quality of customer contacts and loyalty programs and also by creating online satisfaction

survey for customers to do the evaluation and sending them special thanks email. For

39

differentiation strategy, Dusit Thani has used customer relationship management as it has

established a quality of customer contacts and loyalty programs and also by creating online

satisfaction survey for customers to do the evaluation and sending them special thanks email.

For supporting activities, firstly, Dusit Thani used cost leadership strategy to reduce

their financial expenses. However, in terms of spa and education business they tend to expand

by spending a huge amount of capital for long term investment so as to differentiate itself

from other competitors that is by adopting differentiation strategy. Secondly, in terms of

human resource, they even invested a lot of money on MBA program so that its staff can be

trained to perform excellently in their job that differentiates their people from other

competitors. Lastly is the management information system. Dusit use its Opera Central

system which allows each Dusit International hotel chain to directly connect to every

customer through all distribution channels globally. As a result, from this analysis we can see

that Dusit Thani tend to be more focus on cost leadership strategy. Especially in Thailand,

there are over supply of accommodations which lead customers to have more choice, but

investors need to compete in terms of quality and excellence and that lead to price war and

thus shrinking their profit margin.

Strategies relate to Vision and MissionAccording to the vision of Dusit International, the company wants to deliver to the

world an exceptional hospitality experience that reflects the unique artistry and culture of

Thailand and delivers the standards of perfection, innovation and excellence. In terms of

delivering the unique artistry and culture of Thailand, Dusit Thani has related its vision by

their products and services that enhance customer’s experiences. To illustrate, Dusit Thani

Bangkok is decorated with a distinctive Thai artistry to enrich customer’s unique experience

by creating Thai culture and tradition. As soon as the guest enters the hotel, the guests will be

greeted with “WAI” by its employee and also Thai traditional dressing is worn by the Dusit

employees which would give customers a sense of Thai culture. Also, they will be served

with a herbal welcome drink. In addition, the company provides Thai traditional unique

cuisine for their customers such as aromatic Thai herbal stream and mangosteen peel body

scrub etc that represents Thai ways. Also, all of the restaurants and facilities offered by Dusit

are represented in Thai traditional ways. As a result, Dusit Thani wants to provide Thai

hospitality with local sense to customers. Moreover, Dusit vision is also to deliver the highest

standard of perfection to their guests. They believe that no input is more important than the

40

contribution of employees. However, to ensure that their employees have all the necessary

knowledge, skills and competencies, Dusit Thani has develop human resource training and

development program that will enable the staffs of Dusit Hotel to continuously acquire new

skills and competencies that would enhance their performance and to work more productively

in the company. Therefore, the most qualified employees will be choose as now they could

deliver outstanding services to their guest and thus enhance the standard of service and

reputation for the company. Furthermore, Dusit has continuously strived to improve their

ability to delight guest by increasing the service quality standards of the hotel and to reduce

service failure which might occur by having the follow up service. Dusit provides customers

with questionnaire for them to evaluate the overall satisfaction of the service and through this

way, the company can keep track of all the complaints from the evaluation form and thus in

the future they can avoid this mistake from occurring again. However, in terms of innovation,

Dusit Thani tend to focus only on distributional channel such as online travel agency but

whereas the competitors such as Four season and Shangri-La hotel already provide mobile

application which make it much easier for their customers to access to their website. As a

result, Dusit Thani did not differentiate itself from the competitors as they have not yet

innovated any of the advance technology. Also, the information management system of Dusit

Thani is commonly being used in most hotel chain that does not differentiate itself from other

competitors.

The mission of Dusit Thani was to make Dusit one of the worlds’s most valued

hospitality brands in preference and loyalty across every one of its competitive segment. The

company relates its mission in terms of being the most valued hospitality brand. However,

due to high intensity of competition in the hotel industry and in order to outperform its

competitors, Dusit need to deliver high exceptional services to their customers in such a way

that attracts customers and also reach up to their expectation and that customers are willing to

come back and use the service again. Also, they need to outperform their competitor’s right

from the reservation process up to follow up process to ensure high guest satisfaction.

Moreover, Dusit Thani tends to focus a lot on expense reduction in terms of marketing and

operation, rather on delivering a quality experience to their guest. Due to this, customers

might not value much of Dusit Thani services compared to those of their competitors.

Furthermore, in terms of loyalty program, Dusit Thani only gave discounts and rewards

points to loyalty guests and did not deliver a remarkable service to customers. In a highly

competitive hospitality industry, as a result, for Dusit Thani to compete against their

41

competitors they need to come up with something unique that differentiate itself from other

competitors that is by adopting a blue ocean strategy and to provide service in such a way

that at the first time itself customers get impressed with the service that means that the service

has gone beyond the expectations of customers and hence profits for the company.

42

Competitive rivalry and dynamics

Multimarket competition

Multimarket competition is when firms compete against each other in several product or

geographic markets. Hotels can be classified into many types, such as conference &

commercial hotels, resort hotels, casino hotels, boutique hotels, season hotel.

Conference &Commercial hotels:

Commercial hotels mainly cater to business clientele and typically provide room

service, dining area, cocktail lounge, coffee shop and laundry service. Commercial hotels also

usually provide a computer room with Internet and fax services for business professionals.

The location of the hotel will be usually be located in city area. Besides, they are the place for

conference or banquet. Consequently, the facilities like speakers, visual presentation, or

technical equipment’s will be prepared. The clients normally stay in the short period of time.

The star rating is around 3-5 stars (Commercial hotels, n.d.).

Resort hotels:

43

A resort hotel is usually located in the tourist interest places like hills, forests,

beaches, on an island, or in some other exotic location away from crowded residential areas.

Most resort hotels provide extensive food and beverage, valet and room services, sightseeing

to vacationers. In addition, many resorts also provide special activities, indoor and outdoor

games for guests such as dancing, golf, tennis, horse riding, nature hikes, skiing and

swimming, health club, steam sauna bath, spas etc. Normally, the guests will stay at least 4 to

1 weeks. The star rating is around 2-5 stars.

Boutique hotels:

A boutique hotel is one that is generally not chain-affiliated, features an intimate,

stylish appearance and provides impeccable amenities. Some are unique in design,

architecture or theme. However, a boutique hotel usually distinguishes itself in these areas:

design, service and target market. Some boutique hotels are themed; many attempt to be

unique by either offering themed rooms or choosing an overall theme for the hotel. Although

many boutique hotels are small, ranging from single digit rooms to less than 100, some in

major cities have well over 100 rooms. Moreover, a boutique hotel can be equally appropriate

for business, honeymoon, or vacation. The target market for most boutique hotels is the 25-55

age range, most within the middle to upper income level. For some boutique hotels, the target

is the corporate traveler who will provide repeat business for the hotel, refer others and is one

whose business is not based on a particular season. The star rating is around 3-5 stars

(Boutique hotel, n.d.)

44

Season hotels:

The hotels will open the whole year depending on the tourism seasons (Basic

requirements of hotel standard, n.d).

Economy hotels

Economy hotels are those hotels which are affordable and basic needs of staying in

hotel are available and the room’s rates of the hotel are not high. However, it is worth the

price since not many services and facilities are provided to the guest. The rooms are like the

basic accommodation. Some hotels might provide the breakfast as complimentary as well

(Slutsku, n.d.).

Requirement for stars

1 star: The reception desk opens from 7.00 till 22.00 at night. The minimum size of the single

bed is 90 × 190 cm and the double bed is -140 × 190 cm. There should be at least one toilet

and one bathroom for every ten room. The bed linen is changed after 5 nights of stay as well

as after the guest’s stay at hotel. Also, there should be room for having breakfast.

2 stars: The reception desk opens from 7.00 till 24.00 at midnight. The size of the single bed

is 90 × 190 cm and the double bed is -140 × 190 cm. There should be at least one toilet and

one bathroom for every ten room. There are at least 40 % of rooms with private shower and

toilets. The bed linen is changed after 4 nights of stay as well as after the guest’s stay at hotel.

There should be a room for breakfast as well.

3 stars: A Conference hall and elevators should be installed within the hotel. Every room

should have own toilet, bathroom, TV, and internet access. The minimum room floor area

should be 10 m2 for single room and15 m2 for double room.There should be breakfast room,

cafeteria, and restaurant. The linen should be change after the guests left and after 3 nights of

stay. The public toilets should be separated men and women. There should be double room

and single room as well (Hotel Classification, 2010).

4 stars: The conference and seminar rooms are available for the clients. They have all the

quality furniture, mini bar, bathroom/toilet (3, 8 m2) should be in every room. The minimum

size of single bed is 100 x 200 cm and double bed is 140 x 200 cm. Minimum room floor area

45

should be 12 m2 for single room, 17 m2 for double room, and 55 m2 for three rooms. The

bed linen is changed after 2 nights of stay as well as after the guest’s stay at hotel. They

should provide a wide variety of hot dish for breakfast. As a result, the hotel should provide

24- hour room service for the guests.

5 stars:The hotel should have high quality exclusive furniture and equipment installed inside.

All the floors shall be accessible by lift from the same floor as reception desk. They provide

several conference halls with catering possibilities. The minimum size of single bed is 100 x

200 cm and double bed is 150 x 200 cm and 210 cm long. Minimum room floor area is 13 m2

for single room, 18 m2 for double room. The bed linen should be changed daily. There

should be internet and email connection in the guest room. Several a la carte restaurants,

indoor swimming pool and, fitness or health centre should be in the hotels. All services that

are possible for the guests should be added (Hotel Classification, 2010).

6 stars: There are not guarantee that there is a six-seven stars rating exist. According to the

www.newmediatravel.com, this event is called rating inflation. Since as we know that 5 stars

rating is the highest (Hotel rating Inflation, n.d.).

Dusit’s Brand

With the emergence of many types of hotels that aim to serve different target markets,

allowing Dusit to add brand extension in order to cover new target market and increase its

market share. Since 1984 when Honorary Chairperson, Thanpuying Chanut Piyaoui, opened

her first hotel, the “Princess” on Bangkok’s New Road, this successful venture leads to the

introduction of many sub brands later on. There are five brands under Dusit Thani

International which are Dusit Thani, Dusit Princess, DusitD2, Dusit Devarana and Dusit

Residence. Each brand has its own unique characters that focus on different target markets.

46

Dusit Thani

It has been forty years now, the famed Dusit Thani Hotel has been a 'social and

business' landmark in Bangkok. Its international standards delivered with distinctive

Thai artistry and graciousness personifies the earthly manifestation of its name which

means in Thai, a town in heaven. Additionally, it consists of many branches in

Thailand and other countries. However, Dusit Thani has a number of competitors that

are competing against each other of the same degree which includes JW Marriott and

Sukhothai Hotel, and Royal Orchid Sheraton Hotel Four Seasons Hotels and Resort,

Pan Pacific Hotel.

Dusit Princess

Dusit Princess is the 4 stars company. The competitors with the same degree are Siam

City hotel, Soul Twin Tower Hotel, Royal City Hotel, and Royal River Hotel.

DusitD2

DusitD2 is a five star boutique hotel that focuses a lot in providing excellent services

and modern decoration. However, there are still no direct competitors of DusitD2 but

that does not mean that DusitD2 does not have competitors. The companies still have

to compete with many other competitors since the branches are in Pattaya and

Chiangmai. To illustrate, in Pattaya, most of the boutique hotels are four stars which

includes Aya Boutique hotel and Tim Boutique hotel.

Dusit Devarana

Dusit Devarana is a six company which are designed to provide its guests with an

environment where they can detach and de-stress in order to recharge and have the

ability to reconnect with everyday life having an empowered body and mind and it

also emphasize on providing outstanding services. However, there are still no direct

competitors of Dusit Devarana but since the company has one branch in Thailand and

four branches in oversea markets the company still has other competitors.

47

Dusit Residence

Dusit Residence is operated for long-stay customers with the same standard of five

star hotels. They provide an environment of relaxed comfort and the services offers

are balance with the need between residence privacy and hotel-like convenience and

excellence. However, there are still no competitors of Dusit Residence but it does not

mean that Dusit Residence does not have any competitors.

Competitive Dynamics

Whilecompetitive rivalry concerns the on-going actions and responses between a hotel and its

competitors for an advantageous market position, competitive dynamics concern the on-going

actions and responses taking place among all firms competing within a market for

advantageous positions.

Mobile Webpage

Mobile ready websites are no longer emerging trends in the travel industry. They are now a

force to stay and have forever changed the way travel shoppers search, book and interact with

properties. With millions of travellers connected to the Internet via smartphones, your hotel

needs to consider how to reach potential guests at each phase of the buying cycle via the

mobile web. Additionally, the growing consumer use of smartphones to search shop and look

for local and travel information creates more opportunities for hoteliers to connect with their

customers via a mobile site which might include pre-stay, during a stay and post-stay visits.

Thus, Dusit Thani International has its own mobile website which has become a useful tool to

communicate and promote the hotel to the customers. Mobile sites have content and features

designed specifically for handheld devices, making it easy for users to find what they are

looking for on the go. Research shows that mobile –optimized websites significantly improve

user experience and satisfaction. Moreover, customers are able to see the all the updated

information and campaign that Dusit has created. Also, it increase opportunity for booking is

because the number of consumers using their smartphone to reserve or book room has double

significantly. Furthermore, Dusit can stay in touch with their past guests by offering them

special promotions via emails, which can link to the mobile site. Similarly, other big

companies have also created their mobile webpage as well. For instance, Ritz Carlton is one

of the big hotel chains that has created its own mobile webpage in order to improve

48

customers lives and to make it more confortable. To conclude, Smartphones are quickly

becoming part of consumer’s daily life and routine. With the growth of mobile searches

growing at 400% over last year, it’s easy to recognize the potential for customer engagement.

Consequently, Dusit must ensure that its property can be reached in the fastest growing sales

channel, with a revenue driving- mobile website (Mobile website, 2011).

Opera Central System Solution

Dusit use Opera Central System Solution to distribute information about customer reservation

right away to every Dusit hotel. The system includes Opera Reservation System (ORS),

Opera Customers Information System (OCIS), Opera Web System (OWS), and Opera Sales

Force Automation (SFA). By using this information system would allow each Dusit

international hotel chain to directly connect to every customer through all distribution

channels globally such as travel agency, online booking, hotel website and telephone. As over

500,000 travel agencies worldwide would be able to access to the hotel’s Opera Central

Reservation system this can also lead to the increase in reservation volume and gain more

market share worldwide. It is very important today for the hotel to have global reservation

system in order to have connection with travel agents around the world, especially online

travel agency that has become very popular among travellers today. Therefore, Dusit Thani

International is not the only place that install this kind of software, but Four Season Hotels

and resort, Marriot Hotel or other hotels worldwide are also invest in this software as well

(MICROS Completes Global Deployment, n.d).

Joining AHA (Asian Hotel Alliance) and GHA (Global Hotel Alliance)

The company knows that by joining to the AHA (Asian Hotel Alliance) channel it can

expand their markets to other regions since the founders are the big brand from other other

countries including Lantis (Taiwan), Marco Polo (Hongkong), Meritus (Singapore), and New

Otani (Japan). However, these hotels tend to have the same objective as Dusit Thani. This is

because Dusit knows that by joining with AHA, they will get an opportunity to meet their

new potentials and they are chances that company it can help company to increase in their

sales. Besides Asian Hotel Alliance, Dusit International is also a member of Global Hotel

Alliance (GHA) to better serve their clients. GHA consists of 140 upscale and luxury hotels

and resorts, spread over 41 countries. Each brand is a key player in their main region such as

49

Dusit International in Thailand, Kempinski in Europe, Landis in Taiwan & China, Marco

Polo in China and Hong Kong, and Pan Pacific in the Pacific Rim. Through

www.globalhotelalliance.com the member of GHA can make online hotel reservation as well

as airline reservation. By choosing GHA travellers can be sure that they will have a unique,

local experience in a four or five-star hotels while receiving consistent levels of service and

recognition, regardless of their choice of hotels. Dusit Gold Card Members are entitled to

receive member benefits of the participating Global Hotel Alliance hotel’s program they are

visiting.

International expansion

Not only international expansion would allow the firms to increase their profitability but they

can diversify the risk from external factors in particular country. The expansion would also

emphasis the brand image and recognition of those hotels in customers’ perception. This is

the reason why many hotels are now trying to expand their hotel globally. Since Dusit

International mission is to make Dusit one of the world’s most valued hospitality brands, in

terms of preference and loyalty. Dusit is now focusing on the development and expansion of

Dusit brands into the international arenas. Dusit has expanded its chain to a number of

countries include Dusit Thani Manila, Philippines, Dusit Thani Dubai, Dusit Thani Maldives.

While in 2006, Dusit Thani Hotels & Resorts has added a brand extension which is dusitD2

hotels & resorts. The first property in the dusitD2 collection opened in 2006 in Chiang Mai,

followed by DusitD2 baraquda Pattaya in 2009. In addition to DusitD2, the company has

introduced Dusit Residence Serviced Apartments, a combination of an exclusive residence

with five-star service levels. Pearl Coast Premier Hotel Apartments, Dubai, United Arab

Emirates was opened in January 2007, followed by Dusit Residence Dubai Marina, United

Arab Emirates in 2008 (Dusit, 2013). Moreover, in the future Dusit intends to expand its

property in other cities, including Abu Dhabi, Jeddah and Bahrain. The company is focusing

on developing upscale, four- and five-star properties in major tourist destinations, as well as

emerging secondary cities in key countries, such as China and India. It is also considering

taking on properties that provide strong strategic benefit to the global awareness and

recognition of Dusit, including in Europe and the USA (Hotelier middle east, 2012).

50

Competitive Rivalry between Dusit International and Four Seasons Hotel (5

Stars and 6Stars Hotel)

Strategic Actions

1. Loyalty Programs

Loyalty programs are one of the strategies Dusit International use to retain customers.

They do it by coming up with new benefits and privilege that will satisfy customers not just

in the hotel but also use external means such as cooperating with airline industries.

Dusit Gold Card Program

This program provides guests with the privilege to be recognized as their most valued

guests. With this Gold Card privilege guests will receive benefits, such as priority

reservations special room rates, VIP recognition, welcome drink, complimentary fruit basket,

express checkout, savings on laundry and restaurants, and

guaranteed late check-out until 2 pm. which provide guests

with a more relaxing feel as standard checkouts are no later

than 12 pm. This luxurious gold card privilege will ensure

your benefits through all Dusit International hotels all over

the world including branches like Dusit Thani, dusitD2 and

Dusit Princess Hotels & Resorts. Dusit international

promises to deliver excellent experience no matter where the

journey. In addition it allows Guests to have special discounts and experience in Dusit Wine

and Dinning in all Dusit Branches a well. In addition to all privileges and benefits above

customers will also have the benefit of VIP treatment at Devarana Spa, Dusit’s own signature

spa, which is one of the best spa experiences in Thailand. (Dusit Gold Card, 2013)

Annual Membership Fee: Baht 5,900

Baht 5,500 for Dusit Gold Card holder

Presently, the membership is only offered to Thai residents.

51

Dusit Frequent flyer

Another main loyalty program that Dusit International use is the Dusit Frequent Flyer.

Dusit International has partnered with many airline companies such as Thai Airways, Alaska

Airlines, American Airlines, ANA, Qantas, Singapore Airlines and Korean Air, to name a

few (Airline Frequent Flyer, n.d.). Dusit International strategy is to expand networks and

draw in customers from around the globe via transportation means such as airline industry.

This often assists Dusit Thani in reaching out to new customers. With the Dusit Frequent

Flyer privilege customers can use their mileages to stay at any Dusit Thani Hotel and resort

around the world with mileage points discounts. This creates easier accessibility for

customers as well as convenience of booking a hotel. According to customers research shows

that competitors like Four Seasons does not have a definite loyalty program. Even though

they do have affiliations with airline companies such as Qantas,(Qantas Program Partners,

n.d.). Dusit Thani has the edge over their rivalry with this area of expertise. As Dusit have

their hands in opportunities to draw customers with loyalty program both from hotel Golden

Card and from Airline partners. There is no solid evidence of Dusit Thani being the first

mover in the frequent flyer program. However this strategy is a long-term strategy and as

they have been in existence for 60 years they thrive mainly through experience. Dusit Thani

is still in danger of the late mover strategy, which might be done by their competitors to

outperform them in this field. (Dusit International, n.d.)

2. Developments

It is common that Hotels today use new developments and investment as means of

strategic development. Choosing a good location can be a competitive advantage of any hotel

to their rivals. A strategically chosen site can provide a long-term benefit and advantage over

their competitors today. This may also increase hotel revenue and enhance their existence

over time. Direct competitors Dusit and Four Seasons have chosen UAE and India s their

latest expansion sites.

According the world latest trends UAE has been an upcoming destination in terms of

ultra-luxurious destination. This is where tourism market is expected to expand. As research

says in 2010 UAE had the highest number of room counts in Middle East and African hotels

that developed pipeline with 55,165 rooms. Dubai contributed the largest share of room count

among the figures amounting up to about 40,000 rooms completed (Sinclair, 2010).

52

Dusit Thani Forecasted an opportunity

in Dubai as it was destined to be one of

the biggest tourism hubs. In early 2001

Dusit Thani Dubai was established as a

result. This strategic move was to be

the first hotel in UAE to offer a now a

very popular and world-renowned Thai

hospitality. This can be considered the

first mover strategy to capture tourist

who are following such trend will now

have it in Dubai as well (A Luxury

Hotel in Dubai, n.d.). This is a standardized 5 star hotel with a strategic location. It is located

in the middle of business and commercial district which is only 15 minutes away from the

world famous Dubai Mall and close to the Dubai International Financial Center and Dubai

International Airport. Accessibility is one of the strengths of Dusit Thani Dubai s guests finds

comfort in traveling to desired attractions with the hotel’s complimentary shuttle services and

easily accessible public transport nearby.

Dusit’s competitor Four Seasons did not decide to expand to the UAE until summer of 2012.

According to Kathleen Taylor the president and chief executive of the Four Seasons Hotel

and Resort counters that they were waiting and

studying the market and did not want to rush in

such move. Perfection is their aim as they try to

strategically plan their move. “As with all markets

across the globe in which Four Seasons operates, it

was important for us to take the time to find our

niche here as well as identify a partner that first

and foremost shares our service and business

values” (New Releases, 2012). The Four Seasons

Dubai will have a completely different location compared to Dusit. They will be located at

the northern part of the Jumerah beach, which is close to one of the wonders of the world

namely the Palm Island and the upcoming World Island. It is both leisure and a business

district. Due to their exquisite location upper class customers will be attracted who would be

willing to pay higher for he rooms and the location plays an important role. As we can see

53

that this is a late mover’s strategy. They choose to locate themselves away from rivals and

draw in different kinds of customers using Dubai’s developing areas of attraction in their

advantage thus differentiating from Dusit (Yousef, 2012).

Dusit Thani has chosen to be a step ahead of their competitors by being the first

movers. Getting familiar with the market and customers. They will be able to study the

customer’s trends better than their competitors and retain trust and market share, therefore

build a competitive advantage. The target customers of Dusit Thani Dubai are business

travellers. They have more chances of having repeated customers because of their target

group and location. They have more time in hand to create relationship with their customers.

Four Seasons however have the time to plan their move strategically, but being a new comer

can bare burdens such as marketing to draw customers away from their competitors. They

will have time to plan and reduce risk as much as possible. They will take longer time to have

repeated customers coming to them. However, Four Seasons is a large industry and well-

known hotel chain all over the world. Their fame can be one of their main weapons of

attraction and trust by the customers.

India is one of the strongest developing countries today. Their growth has been

tremendous during these recent years and their wealth has increased changing their spending

habits. The country is now trying to polish its infrastructure and has become a well-known

destination for tourism. India has shown increased in economic strength. International

businesses and investors now invest in this rapid growing country. One of them is Four

Seasons. In this case Four Seasons have entered the market before Dusit Thani, Namely Four

Seasons Mumbai.

It came into existence in 2008 and is located in

the high-end city as Mumbai is the center of

commercial and entertainment in India. This

hotel bares 200 guest rooms with luxurious

facilities. Dusit Thani hotel in India is still

under preparation. Dusit Thani has cooperated

with Bird Group for support. The Bird Group are in process of developing six 5 star hotels in

54

India this gives Dusit the opportunity to franchise more hotels in India in the near

future(Malhotra, 2007). Dusit International has planned to open 5 hotels in 2013. Those

hotels would be in New Delhi, Jaipur, Rishikesh, and Goa.

The location Dusit Thani selected is different from Four Seasons, which will make

them indirect competitors in this market. In this case Dusit Thani is considered a late mover

as many 5 star hotels have already had a branch in India. Dusit Thani will have a

disadvantage in terms of market familiarity. However Dusit Thani will have longer time to

plan strategies and tactics to gain customers trust and minimize risk of failure. Dusit now will

have to come up with strategies to outperform their competitors to fight in this highly

competitive market.

3. Sub Brands

One of the recent strategies that Dusit international has adopted to ensure the increase in

flow of customers is by expanding their targets. This is considered a unique portfolio of Dusit

Thani having Deluxe Hotels (Phan-Udom, 2011). This is their corporate level strategy is they

come up with sub brands to increase their variety therefore more choices for customers. Apart

from trademark hotels they offer different feels to their customers. For example: DusitD2 and

Dusit Princess. This is a strategy to capture different group of customers. Dusit Thani also

has other corporate level branches such as their Devarana Spa and Dusit Residence, which is

a service apartment. This sets them ahead of Four Seasons because Four Seasons don’t have

sub branches, which can compete with Dusit on a corporate level.

4. GHA

GHA or Global Hotel Alliance was established in 2004. It is then world’s largest

alliance of independent luxury hotel brands. It was established to improve recognition of the

hotels by gather hotels with reputations from all around the globe as one alliance. The hotels

include Anantara Hotels & Resorts, Kempinski Hotels, Omni Hotels & Resorts, Marco Polo

Hotels, to name a few (About GHA, n.d.). Later in 2007 Asian Hotel Alliance or the AHA

has merged with GHA bringing Dusit who is a significant member of AHA and other Asian

Hotels in this alliance (AHA, 2006). This merger enhanced GHA’s strength as the world’s

largest alliance of hotels. By being a member of GHA, Dusit Thani benefits from integration

through their joint software Micros-Fidelio, which is also a partner of GHA. This enhances

Dusit’s sales reach and reduces their distribution cost at the same time. GHA assists them

55

through distribution channels that are cooperating

under their name. This intern can strengthen Dusit

International’s ability to compete against other

international hotels. Four Seasons on the other hand is

not a member of either GHA or AHA. This alliance is

for independent hotel joints that are not so large in size.

Four Seasons are at a disadvantage as Dusit is the only

mover in this case.

5. Mobile Technology

Smart Phones are means communications business

and activities in today’s world. Almost everyone has a smart phone today. This creates a new

distribution channel called mobile websites. These are websites that are specially made to suit

mobile usage. Dusit Thani has launched a mobile website of their own in 2011. Their goal

was to spread in to the mobile phone market and make it easier for the customers to do their

bookings online (Haridasani, 2011). This is a compact version of the actual Dusit official

website. The disadvantage with this website is that it allows customers to do only single

bookings not group bookings. The website also has language selection options such as

English, Chinese, Japanese and Arabic. This is to suit the needs of users around the globe.

The website also provides updated pictures, room rates, Google map for location and

directions and even trip advisors. This could prove to be a good enhancement of distribution

channel due to today’s smart phone trend.

Four Seasons on the other hand conducted a similar movement in the digital world in

2009. Four Seasons now launched a free iTunes application called Four Seasons Hotels and

Resorts App. This can be used in iPhone, iPod and iPad. According to Mrs.Helstab who is the

executive vice president of marketing for Four Seasons, “the App provides convenience

booking for customers. All of the information about Four Seasons that customers might need

to know are all in the App, including Four Seasons Magazine online, twitter feeds, photos and

videos. By only a touch of finger, customer can explore the hotel experience anywhere they

go”.

Mobile websites and applications are now one of the most effective Distribution

channels today. People these days are always on the go as they are busier than ever so these

distribution channels make it easy for them. This will add to both Dusit and Four Season’s

56

advantage. Both hotels will be able to attract more customers and create more comfort and

satisfaction in the booking process. Four Seasons has the advantage of moving first in terms

of this distribution channel. They have 2 years on Dusit Thani to gain benefit from this

technology advancement. This booking system through mobile websites and application

make it easier for customers to access the hotels and can be a changing factors the influence

their decision making. However, Four Season’s application can only be accessed through

Apple devices and android while Dusit’s mobile website is more accessible to any mobile

phones with Internet services.

6. Six Stars Hotels

Dusit International has recently expanded to the Middle East. Their project to expand

more in the Middle East includes 2 luxurious 6 star hotels, Dusit Devarana and the Dusit

Thani. The Dusit Devarana will be different from all the Dusit Thani branches with Indian

style inspired architecture. It will have a calm, quiet and relaxing feel to the hotel with

elegant and graceful Thai style service with formality. While Dusit Thani will be a family

resort offering lively activities that are designed to entertain families in their vacations. This

resort will have a Moroccan-style construction (Dusit six star, 2007). These two hotels will be

located at one of the world’s wonders, namely the palm Island. Dusit Thani targets the high

spending power of tourists and locals who can stay at the Palm Island. This is an opportunity

for Dusit International to gain more reputation and become more recognized to the world. For

Seasons also have their share of 6 star hotels under their belt one of them is the Mauritius

Beach Hotel. Having a 6 star hotel tells that the companies can provide excellence in services

even beyond the standard of a 5 star hotel. They aim to create unforgettable experiences using

services that 5 Star hotels cannot offer such as personal butlers and 24- hours in room

Dinning experience.

Sam-Erik Ruttmann, Regional Vice President-Dusit Middle East Office, said, "We are

excited about these opportunities to expand the Dusit brands and the gracious style of Thai

hospitality particularly in the Middle East, where personal service is an integral part of the

Arabic culture of hospitality." (Dusit International proudly announce dynamic expansion

project, 2007)

Four Seasons had a 6 Star hotel long before Dusit International. This means Four Season

has established themselves in another level of hotel service experience. This gives them an

edge with better experience in handling 6 star hotels. Dusit Thani who is new to such

standard of service might face high expectations from customers. By studying the market

57

demands for 6 star hotels carefully Dusit can avoid mistakes and live up to expectations of

customers and avoid faults made by earlier movers.

7. Management Information System.

58

OPERA Central Systems Solution was in the hands of Dusit International before any

Hotels in Thailand. Dusit Thani signed a contract in relationship with Micros- Fidelio in

2007. This makes them the first movers in this market aspect. This Software system called

OPERA Reservation System or ORS is created especially for hotels to be able to make

reservations for the guests easier with minimal mistakes. This enhances the working

efficiency of the employees within the hotel making it more effective with high speed of

operation. This software system is used by majority of hotels across the globe. Hotels like

Shangri-La, Best Western, Le Meridien, MGM, InterContinental group and even Four

Seasons are clients with Micros- Fidelio. This shows that Dusit are operating with the same

resources as these hotels (Micros, n.d.) These hotels have the same supplier of software

resources. However Micros is a partner with GHA and so is Dusit Thani, which Four Seasons

is not.

Competitor Analysis

Likelihood of Attack

1) Market Commonality

Dusit International’s Hotels main market lies within Business and leisure travellers

with a considerable spending power. They have been rated a luxurious 5 star hotels which

means their provision of services aim to target those who can afford them. Dusit has

classified their customers in their annual report as Individual travellers, public and

government bodies and company incentive groups. They also attract nationalities like,

European, American guests who want to experience the world renowned Thai Hospitality.

Thai customers also provide large volume of revenue on their part (Product and Service

Supplies, 2005). This is red ocean water for Dusit Thani, as powerful competitor like Four

Seasons are lurking within the same market. Their target customers are very similar. Four

Seasons also target leisure and business travellers(Minor International, 2011). Four seasons

59

also operate at a 5-star level with aim of attracting high-end customers as well. Even their

location tells us about their directness in competition with strategies to locate their city hotels

within transportation reach and business areas. They also locate their leisure hotels on the

beachfront serving the right customers in right places. They both do the same thing for their

different market segments. On top of that both of them are considering the same target market

in the future. Targeting to prosper in the UAE. Mr. Chanin Donavanik said in their Travel

and Tourism Competitive report that, “There is great potential for our Dusit properties in the

UAE and we are expecting average occupancy of our four hotels in the region to exceed last

year’s”. Dusit Thani currently held properties in the UAE are Dusit Thani Dubai, Dusit

Princess City Centre Dubai, Dusit Residence Dubai Marina, and Pearl Coast Premier Hotel

Apartments. They also have plans to expand to Abu Dhabi, Jeddah in Saudi Arabia, Bahrain,

Oman, and Qatar in 2015 (Dusit International, n.d.). Four Seasons on the other hand also

have plans to expand further in the Middle East. Four Seasons also plans to open their first

hotel in Dubai in 2014 (Yousef,2012).

2) Similarity of Resources

Dusit Thani and Four Seasons Hotels are competing with each other in the high-end market.

They compete to provide luxurious services and facilities with high-class accommodations

aim to serve and best satisfy their customers. Their rooms are designed to be spacious and

provide a comfortable feeling to their customers with modern and high-class design. Both

their hotels provide lavishing full service and amenities

Tangible

Physical recourses

Dusit International comprise of four of their own hotel brands. Those are Dusit Thani,

dusitD2, Dusit Princess, and Dusit Devarana. In addition, they also have Dusit Culinary

Institutions, Dusit Residence and their own Devarana Spa (DUSIT INTERNATIONAL,

2012). Compared to Dusit International Four Seasons is lacking in varieties of property. Four

Seasons don’t have sub brands that hold other types of physical properties like Dusit does in

the corporate level. Nevertheless they both share common ground on residence. Four

Seasons’ Private residence is usually situated in popular destinations like Miami, Houston,

San Francisco and Beijing (Four Seasons Residences, 2013). None of these destinations hold

residence to Dusit International. They also share similarities in their spa Business. Both the

60

companies have spa facilities inside their hotel properties to satisfy their customers who are

mostly traveling for relaxation purposes. This means they share similar recourses as well as

target customers. These two hotels also have similar location strategies. They selection of

sites tend to fall near major tourists attractions with easy accessibilities of transportation

options. However, globally Dusit International is still smaller compared to Four Seasons.

Four Seasons have properties located in 90 countries all around the globe, which far surpass

Dusit, who expansion from Thailand has reached only Cairo, Dubai, Maldives, and Manila.

However, they share common ground in Bangkok, Chiang Mai, Maldives, Cairo and Dubai.

Which make them direct competitors who share similar recourses in these destinations. This

also means that in destinations that we can find Dusit Thani, Four Seasons are just around the

corner.

Technology

Technological advancement is moving rapidly in today’s world. This means 5 star hotels

need to keep up with the technological trend and use it to their benefits as a kind of recourse

to pull customers interests. Technology is also used in hotels to provide comfort and

satisfaction with amenities they offer. Dusit Thani is one of the hotels that keep updating

themselves with new technologies to provide customers with comfortable efficient facilities

that they will not experience at home one of the example is: Dusit Thani Manila now

provides complimentary WI-FI connection to the guest rooms. To keep up with today’s

technological trend Dusit Thani Manila goes into partnership with DOCOMO interTouch

Philippines, Inc. It is one of the world’s largest hotel service providers. A local company that

now provides unlimited Internet access with bandwidth up to 30Mbps guaranteed lightening

quick Internet connection. This Internet surges throughout the hotel from all the 530 guest

rooms to the poolside to DFit Fitness and their Devarana Spa. The WI-FI service operates 24-

7. This exceeds guest’s expectations, which further increases Dusit Thani Manila has further

increased its service excellence with value added fit to make any business or leisure travels to

Manila convenient. This is a perfect example of acquiring and utilizing of technological

recourse (Dusit Thani Manila, 2013). On the other Hand Four Seasons is also a good user of

their technological recourses to enhance their service value. For example, Four Seasons

Toronto inserted Inutility’s ICE (Interactive Customer Experience™) Touch guest self-

service technology will be on iPad in every room. They provide iPad touch screen technology

in all of their rooms for guests to be able to use the touch screen system to order room

service, adjust room controls, schedule spa appointments, and request wake-up calls, in

61

addition to 30 other services. “Guest self-service technology is becoming a must have among

average travellers, whether they are doing business or enjoying a personal vacation,” said

Dimitrios Zarikos, regional vice president and general manager of Four Seasons Hotel

Toronto. “Some travellers would forget to pack a toothbrush before they left behind their

Smartphone. We are exploring a variety of ways to harness this technology to provide the

greatest benefits for our guests and to conveniently extend additional services to them.” This

partnership will allow Four Seasons to excel in the market with such attractive and innovative

technology (Four Seasons Hotel Toronto, 2012). In conclusion, both the hotels tend to have

very similar strategy by becoming partners with successful local software companies to

enhance their technological recourses.

Intangible

Talent Management

Hotel Business runs in human capital to provide quality services and ensure guests

satisfaction. A hotel with strong employee relationship has an advantage of motivation and

high chance of good performance appraisal. Both Dusit Thani and Four Seasons focus

heavily on the employee relationship. Both hotels tend to create family like environment to

and friendly atmosphere to create a sense of belonging this will help them to reduce their

turnover rate as well. Their main aim is to achieve trust from their employees by trusting

them in the first place to create sense of responsibility and motivation at work. Both the

companies have proven to be selective of their employees as they both focus heavily on HR

management and recruit only those who fit the description of their organizational mission and

vision. Both of them focus on hiring qualitatively rather than quantitatively. Both of the

hotels invest considerably on training and development. These programs are frequently

provided to ensure increase in

performance rate of their employees

resulting in performance enhancement

of the company as a whole. Dusit

Thani and Four Seasons honour their

employee’s performance with

invectives and rewards. They also

hold the same strategy of monthly

birthday parties to employees and all

62

the managerial and working levels attend them. Reducing the perceptual gap between

positions creates Dusit Thani’s warm and homely atmosphere. This is however, rare in large

organizations like Four Seasons (An international marketing strategy analysis, n.d.). Four

Seasons also have their unique incentive program strategy called “Unforgettable Experience”.

Tailored to a getaway most desirable to their personal interests. Award recipients are able to

pick from a list of 47 participating Four Seasons properties worldwide (Incentive Award

Programs, 2010).

Reputation

Reputation is another kind of recourse that is intangible. It is a resource because

goodwill, credibility and trust of the hotel are affected by the companies’ image and

reputation. A better reputation will gain more trust from the market as well as investors. Their

awards measure hotels good reputations. Both Dusit Thani and Four Seasons have earned

many awards in the past this make them both familiar with the strength their reputation have

as recourse. The good images that both the hotels have been building through the years of

their existence enable them to rely on their reputations for goodwill. For instance, Four

Seasons received an award for being the “World’s leading luxury hotel brand” in 2008.

Likewise Dusit Thani Laguna Resort received “Asia’s leading Beach Resort” in 2012

(Awards Winners, 2012). Four Seasons is a larger brand than Dusit Thani as it competes in

90 countries. But they do not have the Asian hospitality trend which is becoming increasingly

preferable as Dusit Thani are expanding they will become strong competitors.

1. Experience

Tourism industry is a very dynamic, highly competitive and sensitive industry. The

barrier to entry is not that hard to overcome, as there are frequent new entries in the market.

The survival of the company depends on efficient management of recourses and being aware

of the threats around them. Clear goals and clear view of their target customer’s plus potential

obstacles to achieve them must be evaluated. Awareness and knowledge about the market

behaviour of their target customers and identifying direct competitors. For example, Dusit

International is well aware through 60 years of experience what 5 star level market looks like.

They identify their main types of customers as business and leisure travellers. Dusit Thani

positions itself as a luxurious 5-star hotel. They have set themselves up to take on the mite of

their competitors who might attract the same market and are aware of the potential threats

like, Four Seasons, Shangri-La, Intercontinental and St. Regis. They are all competitor at the

63

same level and market. In this kind of market Dusit needs to step up their game and try to

outperform their customers. To do this they need to make the most out of every situation they

are in they will not always be the first movers but if they are they might need to take control

of the market efficiently. If they become a late mover they must learn from their competitor’s

mistakes and thrive upon it. Therefore, having awareness of being in any situation in the

market their situation is important.

2. Quality

Quality is what customers seek from hotels when they travel. The problem is it is

difficult to measure. The quality of a hotel’s services depends on the customer’s perception

and expectations majority of the time. To enforce the necessity of having an excellent quality

in the hotel the top management must be able to include it in the organizational mission,

vision, objectives and even value chain. This is to ensure that it is understood by the whole

organization. To have their own standard and built in quality improvement Dusit Thani has

taken drastic steps to make sure it happens. Services come from people and people are the

ones who create an experience for the guests. Dusit Thani established Dusit Executive

Development Center Co. Ltd (Phan-Udom, 2011). As they support this idea. Training is an

investment not a liability. The purpose of this company is to build potential and a well-trained

workforce who has Dusit mentality or organizational culture. They have created a couple of

courses to ensure their productivity of quality workers and have their own standard of quality

as a day-to-day life and preserve the Dusit mentality. The training centres, educational

institutions that they have created to ensure quality creation are Dusit Thani College, Le

Cordon Bleu Dusit Co., Ltd and Under graduated courses by Dusit Thani Plc.

Competitive Rivalry between Dusit International and Shangri-la Hotel (5 stars

and 6 stars hotel)

64

Strategic and tactical action1. Resorts in Maldives

Shangri-La hotels and resorts, the leading luxury

hotel group in Asia Pacific, opened Shangri-La’s

Villingili Resort and Spa Male, Maldives on July

26, 2009. Located in Addu Atoll, the resort is 70

minutes away from the Male International Airport

and an eight minute boat ride away from the Gan

Airport. The resort is surrounded by a remarkable

coral reef, is home to 17,000 coconut trees, is

situated along over six kilometres of the coastline

and 2 kilometres of white sandy beaches.

From private ocean retreats to tropical tree

houses, the villas in the resort offer a luxurious accommodation with a spectacular sea

view. There are 142 villas with seven distinctive styles: Pool Villa, Deluxe Pool Villa,

Water Villa, Ocean View Villa, Beach Villa, Two-bedroom Beach Villa, Tree House

Villa, Villa Muthee and Villa Laalu that exude a sense of peace and serenity, each

consisting of luxurious amenities with the décor having touches of Indian and Middle

Eastern elements. They offer “Something for everyone- every day of the week” which

cater to all tourists who are fond of activities and adventure, such as guided snorkel

exploration, natural glow, fit-ball, scuba diving, beach Frisbee and much more. Tourists

are entertained because activities keep changing on a regular basis (Shangrila.com)

Dusit Thani Maldives, located on Mudhdoo Island in Baa Atoll which is 35 minutes by

seaplane from the capital, Male and 10 minutes by speed boat from the new domestic

airport. The resort opened on February 6, 2012. It was the first step into their strategic

expansion plans by Dusit International. The resort focuses on the blend between graceful

Thai hospitality and the beautiful luxury setting of the Maldives.

65

It consists of 100 villas, each

offering a haven of modern

sophistication and luxurious

amenities with trendy technology

such as outdoor rain shower,

nespresso machine, Wi Fi, pools in

majority of the villas, and cable

TV with plasma screens with an

excellent sound system. The villas include the Beach Villa, Beach Villa with Pool,

Lagoon Villa with Pool, Ocean Villa with Pool, Ocean Pavilion with Pool (two

bedrooms) and Beach Residence with Pool (two bedrooms). The points of interests

for Dusit Thani Maldives are the beautiful white sandy beaches enriched by a

turquoise lagoon, excursions provided within Baa

Atoll seasonally feeding whale sharks, manta rays

and other marine life and also frequent spotting of

dolphins on the outskirts of the lagoon.

Dusit Thani Maldives offers a wide variety of dining

experiences. Market, bringing the culinary world to the

Maldives offers a wide range of international a la carte

selections with an international breakfast and dinner

buffet. Their signature Thai restaurant, Benjarong, offers a flawless dining and service

experience accompanied by the finest wines. Sea Grill offers the freshest seafood and

steaks. The Sand Bar acts as a retreat from the heat during the day and the Sala Bar for

watching the sunset or stargazing (Dusit.com)

After analyzing the information above, the opening of the new resort in Maldives in early

2012 will elevate the Dusit group’s brand image to an entirely new level, it also supports

one of the brands future objective of strategic expansion around the globe. From the

consumer markets point of view, we see that most travelers prefer to stay at hotels and

resorts that can meet their needs, or the ones they are used to going to because they trust

the organization’s standards or some even prefer to try new resorts and hotels, which is

why not only the Shangri-la’s Villingili resort and spa but also other current hotels and

resorts will be affected by the newly opened Dusit Thani Maldives. On the other hand, as

mentioned earlier, some travelers prefer to stay in the same hotel when they visit the

66

destination more than once, therefore Dusit Thani might not be able to gain Shangri-La’s

customers in the Maldives unless they prove themselves to be much better than their

competitor and choose the right ways to attract the travelers.

Moreover, in the case of expanding their organization to the Maldives, Shangri-La opened

their resort in Male, Maldives on July 26,2009 which makes them the first mover, this

means they get a large part of the target market before other competitors and they can

make their mark easier than other competitors that expand later. Dusit Thani opened their

resort on February 6, 2012 which makes them the late mover, although they get a smaller

part of the target market and it is more difficult for them to make a mark, their risks are

much lower compared to Shangri-La.

1. Investment in MICROS-Fidelio’s OPERA

MICROS systems is the leading provider for enterprise applications for the hospitality

and retail industries around the world. Currently, over 370,000 MICROS systems are

installed in table and quick service restaurants, hotels, motels, casinos, leisure and

entertainment and retail operations in more than 180 countries and all seven continents.

Moreover, they provide property management systems, customer information solutions

and central reservation for more than 30,000 hotels around the world and also loss

prevention, point-of-sale, and cross-functionality for more than 150,000 retail stores as

well as 17,000 fuel and convenience stores. The MICROS stock is traded under the

symbol MCRS through NASDAQ.

On December 18, 2003, MICROS systems

announced that the Dusit group, Thailand’s

leading hotel management company has selected

the OPERA enterprise as its new standard for

information technology solutions.

Khun Chanin Donavanik, the executive director of Dusit

Thani PLC said that “ Dusit Hotels and Resorts went through

a very detailed selection process”, he continued by saying

“Integration of the OPERA modules, advanced technology,

the robust ORACLE database, the cost effective product distribution connection options,

MICROS's global support infrastructure, and the financial stability of MICROS Systems,

Inc. made OPERA the logical choice for Dusit Hotels & Resorts. Our flagship property,

67

The Dusit Thani Hotel in Bangkok, is the first hotel utilizing OPERA - not only within

the Dusit group but also in the city of Bangkok. This clearly demonstrates Dusit's ongoing

commitment to provide the business and leisure travelers the most advanced and up-to-

date accommodation, business, and dining experiences." Moreover, Stefan M. Piringer,

the president of MICROS-Fidelio Asia/ Pacific added that “Dusit Hotels & Resorts

selection of OPERA is a powerful vote of confidence for MICROS-Fidelio's ongoing

efforts to provide the hospitality industry with the most advanced and integrated hotel

automation solutions. We look forward to more Dusit group hotels utilizing OPERA in

the near future."(Micros.com)

On May 19, 2004 Shangri-La hotel and resorts

invested over US$3 million in MICROS-Fidelio’s

OPERA Central Reservations and Customer

Information Systems. The system ensures that

negotiated can be booked through all the channels

through the sharing of individual preferences giving higher levels of guest recognition at

all the 42 Shangri-La hotels and properties. Moreover, members of the Golden Circle,

which is Shangri-La’s guest recognition programme, will also be able to maintain a

relationship with Shangri-La through the company’s website. Using the group’s

worldwide toll free numbers, reservations can be made for any of the Shangri-La’s

properties and the group assures the callers of the best rates and last room availability.

Martin F. Waechter, Shangri-La’s chief marketing officer said “Shangri-La is renowned

worldwide for its highly personalized service. The new systems will allow us to support

our staff and ensure consistent service delivery. The easy access to information will help

us identify trends enabling us to anticipate guest needs and exceed

expectations.” Moreover, in addition to the existing reservation centres in Tokyo, Hong

Kong and London, a new call centre has been recently in Kuala Lumpur. With this new

centre being opened, Shangri-La has obtained new toll free numbers to provide service to

Malaysia, Philippines, Indonesia, Thailand, Singapore, Taiwan, India, the Middle East

and the South African markets, making it easier for these groups to book hotels of the

Shangri-La group. For the groups in northern and southern China, there are two toll-free

reservation numbers and for Australia, New Zealand, Japan, South Korea, North America

and Europe, the existing toll-free numbers remain the same (Breakingtravelnews.com).

68

In the case of investment in the MICROS-Fidelio’s OPERA, Dusit Thani is the first

mover since they invested in the system on December 18, 2003 and Shangri-La invested

in the system on May 19, 2004 which makes them the late mover. That is around one year

apart where Dusit Thani got to enjoy the faster, more convenient and high tech program

compared to other hotels and resorts.

2. Loyalty Program with Airlines

Dusit has an alliance with many airlines such as Japan Airlines, Jet Airways, Korean Air,

Kingfisher Airlines and Bangkok Airways. Members will receive award miles per

qualified stay. The Dusit Loyalty Program includes the Dusit Gold Card, Dusit Wine &

Dine, Dusit Executive Club, DTCPF Prestige which can give guests Golden Privileges

and Benefits such as priority room reservations, special room rates, dining privileges and

VIP treatment. In addition, Dusit targets different types of members such as the

government, secretaries and travelers. They can attract a large customer base by offering

this loyalty program. (dusit.com)

Guests of the Shangri-La hotels can earn Golden Circle (GC) award points or airline

miles with any eligible stay at Shangri-La hotels, resorts, traders or Kerry hotels. Guests

need to present their airline partnership programme membership card upon check-in to

receive the privileges. Shangri-La has an alliance with many airlines such as Air Canada,

American Airlines, British Airways, Delta Airlines, Korean Air, Jet Airways and many

more.

By offering the loyalty program, they can attract a large number of customers to stay with

them. Although the benefits that both offer are quite similar and there is no evidence of

who the first, second or late mover is, many guests will choose to stay in hotels that offer

many of these programs because they receive many privileges such as priority bookings,

travel upgrades, free air travel, access to airline lounges etc. In this case, after comparing

what both have to offer, it can be seen that while Dusit mainly focuses on satisfying its

members, Shangri-La has programs for Non-Hotel stays as well Co-Brand Credit Card

Spend, not just for Hotel Stays. (Shangrila.com)

69

3. Mobile Website

The mobile website for Dusit Thani is

http://www.dusit.com/mobile/. With the

mobile version for smart phone users, it is a

quick and easy way to stimulate revenue

through online bookings for worldwide

travelers. Special offers on the website include

Advance Purchase Internet Rate, Family

Escapade, Visa Commercial Offers, Spa

Escape, Tee off for golf, Honeymoon Special etc.

The mobile website for Shangri-La is http://www.shangri-la.com/mobile/. Guests can

view offers, rooms, dining, recreation details, modify/cancel reservations etc through the

mobile website.

In the case of using the mobile website, Shangri-La is the first mover and Dusit Thani is

the late mover. It is extremely beneficial for hotels to have a mobile website since today,

an increasingly large number of people are addicted to smart phones and they use it for

almost everything else because it is convenient, easy to use and has mobility. Hotels can

target large the upper class. Besides the hotel website, smart phones are used to access

social media such as facebook, twitter and instagram. Since Shangri-La is the first mover,

it had the benefits of being the first to target a large group of people and making them

aware of what their hotels have to offer.

70

4. Six Stars Hotels

In May 2007, it was reported in The Nation that Dusit Hotels and Resorts plans to open six-

star hotels and residences in the Middle East to tap the high-end market. Chanin Donavanik,

CEO and managing director of the Dusit group recently said that the joint-venture

developments would give them a firmer foothold in the Middle East market. It has been a part

of their expansion plans since their office was set up in Dubai in mid-2005. Chanin said,

“"Coupled with the existing over 300-room Dusit Dubai hotel, the latest project agreements

will make Dusit's presence in the region much stronger," The Dusit Palm Island project

consists of two hotels- the luxurious six star Dusit Devarana Dubai and the Dusit Thani

Dubai including the exclusive Dusit Residence. The Dusit Devarana will have an Indian

inspired architecture offering a quiet, elegant and graceful service in a relaxed and slightly

formal atmosphere. It will have 114 large rooms and suites. Dining facilities will consist of

restaurants and Dusit Gourmet. Other facilities will include their signature Devarana Spa,

conference and meeting rooms and also two swimming pools.

The Dusit Thani will be a family resort with 272 rooms and suites. It will have Moroccan

inspired features that will offer lively activities perfect for families to relax in a private and

informal setting. They will also have 10 free standing chalets as a family unit surrounded by

water. Each chalet comes with two floors and a desert tent theme. These projects were

designed to exude the Middle Eastern style architecture.

In addition, the group has also entered a joint venture with Bird Hospitality Services to

support their investment plan in Asia. Bird group, which is one of India’s largest diversified

groups with presence in aviation, travel and information technology is committed to

developing five and six stars hotels in Goa, New Delhi, Rishikesh, Pune, Amritsar and Jaipur,

providing Dusit an opportunity to offer a franchise or manage many hotels in India.

(Nationmultimedia.com)

Shangri-La’s six stars resort, the Shangri-La Barr

Al Jissah Resort & Spa, Muscat which is nestled

against the rugged interior mountains and the

beautiful waters of

Oman, comprises of

71

3 hotels: Al Waha Hotel, Al Bandar Hotel and Al Husn Hotel. It is 45minutes away from

the Seeb International Airport and located close to the Ruwibusiness district and the old

city of Muscat called Mutrah. The resort is situated amidst 124 acres of landscaped

gardens with 640 luxurious bedrooms including suites, a large variety of food and

beverage outlets, including nine restaurants, four casual dining outlets and pool bars,

three lobby lounges, two bars, CHI The Spa and three private beaches, along with many

other activity options.

The Al Waha hotel, which means “The Oasis”, has been designed in such a way that the hotel

has several swimming pools to form an oasis that incorporates many date palm trees. It is

Oman’s first dedicated family hotel. It is also the largest among the three hotels

compromising of 262 guestrooms, each providing guests with either a 5 sqm balcony/patio,

with the sea view or sea facing perspectives.

The Al Bandar hotel, which means “The Town”, is a five star deluxe property that provides

198 sea-facing guestrooms. Its design is inspired by the old Muscat, with buildings of varying

heights and a variety of ornate balconies. It is resort’s focal point as it features seven food and

beverage outlets and 11 meeting rooms as well as the spectacular Barr Al Jissah Ballroom,

measuring 1,056 sqm and providing banquet-style seating to accommodate 700 people.

The Al Husn hotel consists of 180 rooms and suits and offers the highest level of service,

amenities and privileges to travelers. It is among the largest and most luxurious in Oman,

with the décor being inspired by royal Arabian palaces and decorated with authentic Oman

artworks. Guests have access to a 100 metre private beach, as well as a complimentary mini

bar, daily complimentary afternoon tea and pre dinner cocktails and canapés service.

Although there are no facilities for children, they can enjoy the Lazy River, Children’s pool,

play room and water aquatic play area in the Al Bandar and Al Waha hotels. However,

children below 16 are not permitted to use the private beach and Al Husn pool.

(Shangrila.com)

72

In the case of six stars hotels for both companies, Shangri-La has more six star hotels than

Dusit Thani and they are also the first movers of six stars hotels, making Dusit the late

movers. Most six stars hotels are located in areas with high class people especially where the

Arab people are located because they have a high spending capacity and it is better to locate a

hotel where many high end people visit and also where the high end attractions are. Shangri-

La has opened their six star hotels in these areas (around 5) and Dusit Thani has lesser

(around 4) but with more expansion plans in these areas. Although Dusit Thani was a late

mover, there are several benefits such as lesser risks, the ability to plan new hotels in a better

73

way by not repeating the competitor’s mistakes and the ability to attract consumers that prefer

staying at new hotels for the experience.

Competitor Analysis (likelihood of attack)

1. Market Commonality

Both Dusit Thani and Shangri-la hotels are among the five star hotels list. They both target

leisure and business travelers with Dusit Thani having a good client segment consisting of

high end business and corporate/diplomatic travelers, leisure guests and up market MICE

groups. Shangri-La is very well equipped to accommodate guests from a variety of segments

such as the business centre, the Spa, fitness centre, outdoor pool and other luxurious facilities.

But if we compare the number of hotels that are currently situated around the world as well as

the ones in the expansion plans, Shangri-La has a much larger number with a 108 hotels

around the world, they can gain more profit from a larger market where as Dusit has 27 hotels

around the world including Thailand showing that they still have a long way to go in terms of

expanding their company.

2. Resources Similarities

Tangible Resources

Dusit Thani consists of five hotel brands which are Dusit Thani, Dusit D2, Dusit Princess,

Dusit Devarana and Dusit Residences. They also operate their own signature Spa, Devarana.

The Dusit group has been carrying out their strategic expansion plans around the globe in

countries like Philippines, Egypt, UAE and Maldives. Moreover, there are eight more

upcoming properties in the future in the United States, Thailand, India, China, Saudi Arabia

and UAE. They will be able to target the larger portion of the international market these

expansion plans. Their Spa is their unique product which is offered in all their properties

except the Dusit Princess. In terms of distribution, all their hotels and resorts are standardized

in terms of their facilities and services, for instance, they offer a business centre complete

with computers, fax machines, secretarial services and other facilities business people might

need. They also have a fitness centre, swimming pool and a variety of international

restaurants.

Shangri-La, however, holds a majority of the control over all their properties. They are also

known for being easily accessible to their clients through various forms of transportation

74

from the airport and surrounding attractions. Although most of their hotels are not very new,

they keep maintaining and upgrading their properties to accommodate more guests during the

high seasons. Even though their rooms are not fully occupied during the low season, the high

season and special events usually compensate for it. By optimizing and combining the

utilization of their physical resources of all the Shangri-La hotels and resorts, they should be

able to surpass their competitors. As a side note, Shangri-La, with maintaining and upgrading

their assets in 2006, increased their value by 5%.

Intangible Resources

Dusit Thani places a lot of importance on service excellence by investing in human capital.

To obtain excellent service, Dusit understands that they need to make a strong commitment to

their employees by keeping them happy at work and allow them to continuously grow.

During their morning briefing session, Dusit Thani circulates the “Dusit Daily News” to

every department in the organization which encourages their staff to read and share their

opinions on current events relating to the hotel chain. It contains Our Brand Credo, which

serves its purpose to remind the staff to work “By continually striving to redefine industry

standards”, Dusit Value, which is “We celebrate those with positive ambition who search

ways to transform not just do the same”, Today’s Thought, which gives a single motivational

thought for the day to which employees can relate to such as “So of cheerfulness, or a good

temper, the more it is spent, the more it remains”. Thai Talk discusses the Thai food, clothes

and dance. Essence of Work gives tips on working and Achievements informs staff of hotel’s

achievements such as the customer satisfaction surveys and hotel’s awards etc to motivate

staff members to work hard. In addition, their morning briefing session will end with “Dusit

Service Quality” to remind the staff of the level of quality they are expected to provide to the

guests. As a result, all staff members will have the same knowledge and understanding and

finally carry out standardized and excellent quality service.

Among the top international hotel groups, the Shangri-La group is the second largest

employer. The company goes through a detailed selection of its employees to match their

qualities to the right department and then train them for career development positions. The

purpose of training is the recognition that the lower ranked employees depends upon the

qualities their leader possesses, as well as to think fast on their feet, and to predict guests

75

according to their human language etc. Excellent staff adds to giving the company a

competitive edge and achieve unity in the organization. Shangri-La’s departments have been

divided into 9 different departments which are rooms division, food and beverage,

accounting, maintenance and engineering, marketing, human resources, security and other

revenue departments. These departments have a collaborative relationship that share

information, concerns and solutions to problems. Although internal communication is

commonly recognized, a lot of organizations are still quite weak in this area. Shangri-La is

efficient because it recognizes the importance of communication in creating a strong, unique

and unified value from the organization.

In terms of having a career in the Dusit Thani chain, the benefits of joining is because “We

treat our people as our most valuable asset, so they will be offered our Compensation and

Benefit Plan including : competitive pay and benefits, well-tailored uniforms, career

development programmes, career advancement job training, job rotation, complimentary

meals and more.” They also have a management trainee program for high achieving

graduates. Shangri-La runs a talent development programme which fast-tracks their most

promising colleagues towards quick advancement within the group. The members have the

opportunity to experience working in all departments, specialize in particular areas and get

hands on experience. The program is tailored for Corporate executive trainees, corporate

management trainees and corporate trainees.

3. Awareness

The hospitality industry requires indirect marketing, since there are a lot of competitors in

this field; organizations have to be aware of the techniques of their competitors by using

benchmarking which is the process of comparing one’s business to another in terms of

performance and processes to make their own organization the best. It is also very essential to

have a marketing plan that can be followed through. Since Dusit Thani has many competitors

with the same market segmentation, they need to come up with a unique marketing plan to be

able to compete with other luxurious five star hotels.

4. Quality

In order for an organization to be successful in the hospitality industry, quality is the key.

Service Quality Management is the existing trend that has been used; it is “the collective

effect of service performances which determine the degree of satisfaction of a user of the

service”. Quality varies depending on the customer’s perception of a service, so service

76

quality management monitors and maintains end-to-end services for specific groups of

customers; this can help organizations achieve a competitive edge. Dusit Thani group takes

their quality of service as a top priority, which is why they work with the Bird Group, where

their services are committed to develop 4, 5 and 6 star hotel, allowing Dusit to manage or

franchise their hotels and resorts to several parts of India. Their total investment in the Bird

Hospitality Services is around 200 million US Dollars.

Competitive Rivalry between Dusit International and Centara Hotels and

Resorts (4 stars and boutique hotel)

4 Stars Hotel- Dusit Princess and Centara Hotel and Resorts

Royal Princess Chiang Mai, opened in 1991 is one of the hotels under the Dusit Princess

Hotel Chains. It offers numerous services and facilities to ensure that all visitors have a

memorable experience in Northern Thailand. Apart for being known for its Thai Aristocracy,

this beautiful hotel is situated in the heart of Chiang Mai, and provides easy access to the

region’s exquisite scenery, the alluring Night Bazaar and the authentic Thai arts and crafts.

The Royal Princess Chiang Mai offers 198 stunning rooms and suites, making all visitors feel

the warm personal service and hospitality Thais have to offer (Royal Princess Chiang Mai,

2013)

The Lobby Bar is the place-to-be for relaxing and sipping on cooling drinks and relishing

delicious snacks. It is located to the side of the hotel lobby, charmed with its white marble

and Lanna-era decorative style. Apart from visiting the Lobby Bar, guests can visit the

swimming pool and the tropical garden terrace with its poolside bar to create the perfect place

to catch up with friends and unwind. The Fitness Centre is equipped with the latest fitness

machines, allowing guests to enjoy beneficial work out sessions at the hotel.

The Garden Café, which is located on the ground floor of the hotel, offers Thai and European

Cuisines. It can seat up to 100 people and its décor focuses on bright and light colors. The

white walls and red tiled floor combine to make this a particularly attractive venue both

during the night, as well as day time. The menu provides a range of traditional and regional

Thai dishes along with Asian favourites and a European selection dishes.

77

Located on the Mezzanine Floor, the Jasmine Hotel can seat up to 150 people, and serves

excellent Cantonese cuisine along with other regional Chinese specialty dishes. The décor is

modern; with engraved glass screens and light color schemes all around to let the room look

spacious and the long windows allow plenty of natural light to get in. Lastly, Dim Sum

lunches are extremely popular here.

All the rooms found at the Royal Princess are spacious, while the color scheme is natural,

muted and contemporary Thai Style. While the floor-to-ceiling windows add to the feeling of

spaciousness, the subtle lighting exudes warmth for a relaxing ambience and offers views

across the hotel gardens and the city. This hotel offers a wide range of accommodation

choices- Superior rooms, deluxe rooms, junior suites, One-bedroom suites as well as

executive (two-bedroom) suites available. Each of the 198 rooms have satellite cable

television, central air conditioning, Wi-Fi connection, IDD telephone, a mini bar, tea and

coffee making facilities as well as a personal safe. Room service is available 24 hours a day

(Royal Princess Chiang Mai, 2013)

Meetings and Conventions: Dusit International’s MICE caters to boardroom meetings for a

group of ten, to evening cocktails for over a thousand guests using first class facilities and

services. Guests can book from participating hotels and resorts can receive great discounts up

to 25% for the first night rate as a credit against additional privileges guests can enjoy during

the day. This includes dining, cocktails, delegate packages, team building activities spa

treatments and other services available. Furthermore, the Royal Princess Chiang Mai’s

Vimarnman Room, which is situated on the 10th floor can hold 150 people and is perfect for

small to medium size meetings and seminars.

Green meeting: To promote being green, Royal Princess offers numerous food, beverages as

well as services that is good for the environment as well as the guests. Example include green

themed coffee breaks, green buffet/set lunch menu at the garden café, organic set lunch with

vegetarian selections, hydroponic vegetables, herbal juices, organic coffees and teas and

more. Apart from this, the air conditioning is set to a minimum of 25 degrees, only recycled

writing equipment’s are used, 3 recycling bins in each meeting venue and also meeting

venues decorated with plants and flowers.

Centara Duangtawan Hotel Chiang Mai

78

Centara Duangtawan Hotel Chiang Mai is located in central Chiang Mai, and has 512 rooms

with modern décor, 4-star accommodation, exquisite restaurants and bars, splendid pool and

an exclusive fitness centre. It is situated in a great location since it is extremely near to the

famous night bazaar, which is a shopper’s paradise.

When talking about the hotel’s services and facilities, Centara Duangtawan has a romantic

outdoor swimming pool and a sun terrace, surrounded by a panoramic view of the stunning

hills. It also offers a huge range of services which include: A fitness centre, Jogging track,

Spa centre, aerobic and yoga studio, Jacuzzi, sauna and steam rooms, locker rooms, In-room

massage, tulip massage, beauty salon, service centre, internet lounge, shopping arcade as well

as a car rental service (Centara Duangtawan hotel Chiangmai, 2013)

Restaurants and Bars: To begin with, the hotel has the Sunflower Chinese Restaurant, which

serves Cantonese cuisine prepared by experienced master chefs along with a Dim Sum lunch

menu. Furthermore, the Tawan Restaurant serves Thai and International cuisine and offers all

day dining. Their menu highlights international Japanese and Asian favorites, served in

casual and comfortable surroundings. Centara Duangtawan has a Lobby lounge, which is the

main meeting point for the hotel guests and external visitors. The lobby lounge is the perfect

place for relaxing, offering cocktails, wine, whisky, juices and homemade bakery items.

Another lounge they have is called the Malibu lounge, which serves cocktails over live

music. The Marco Polo restaurant offers various kinds of delicious steaks, pasta and noodles,

including drinks, fruits and desserts. Lastly, Centara Duangtawan has a pool bar, which is

surrounded by their magnificent pool and is set against the backdrop of Chaing Mai’s highest

peak called “DoiSuthep”.

Meetings and Unite:This is an extensive self-contained meeting venue in the heart of Chiang

Mai, which facilitates the Duangtawan Grand Ballroom. This ballroom can accommodate up

to 800 guests, and has 14 other break-out rooms such as Chiang Saen rooms, Chiang Dao

rooms. Chiang roong rooms, Chiang kham rooms, Doi Luang rooms and Chiang Khong

rooms. All these rooms have an LCD and slide projector, screen video, multi-system

VCR+TV as well as a white board.

Introducing Duangtawan Pavilion, the new rooftop garden venue in Chiang Mai, which is an

exciting venue for outdoor events located on the rooftop of the Grand Ballroom. This

pavilion is designed to be suitable for banquets, concerts, fashion shows, and theme parties.

79

The maximum capacity for a cocktail event is 1000 people, 500 people for a banquet, and 460

people for a theatre style event or fashion show.

Analysis:

Since Dusit Thani opened its hotel 13 years before Centara, Dusit Thani becomes the first

mover and Centara becomes the second. Royal princess Chiang Mai is opened by Dusit

Group, while Centara Duangtawan is under the Centara hotels and resorts chain. These two

hotels are located in the same area, extremely close to the night bazaar of Chiang Mai, and

they both target guests that attend the meetings and conventions. In this case, Royal princess

was opened before Centara Duangtawan, so they have a larger loyal customer base, and

people recognize their hotel. They also have Green meetings, which is a selling point, since it

is a different strategy and people that book meeting rooms can get up to a 25% discount.

However, Centara Duangtawan is a new hotel, so people might want a change, and want to

try a new hotel since it might be more modern and up-to-date. Also, when looking at their

number of restaurants and bars within the hotel, Centara has many more choices to choose

from compared to Royal Princess. And lastly, Centara Duangtawan opened a new hotel to

compete with others by providing various types of meeting rooms as well as convention halls.

They also have both indoor and outdoor venues for fashion shows, concerts, banquets as well

as theme parties. Therefore, Centara might be chosen over Royal Princess in Chiang Mai

since it has many competitive advantages.

Boutique Hotels – Dusit International and Centara Hotels and Resorts

Dusit D2 brand: Under the Dusit D2 brand, there are two branches of D2 hotels in Thailand,

and Dusit plans to open two more in India. The hotel’s main customers are ones that arrive

for business or vacation, customers who want a new experience along with modern design

and high quality services. The main thing the D2 branches focus on are: modern décor,

outstanding service and new ideas of improving the hotel to the best they can. The first

branch of Dusit D2 in Thailand is Dusit D2 Chiang Mai, which is located in a business

district near the famous night bazaar. The hotel was opened in 2006, and has 131 rooms to

provide comfort, privacy and delight- Deluxe King, Deluxe Twin, Club Deluxe King, Club

Deluxe Twin, Studio Suite King, Studio Suite Twin and lastly, the D’suite. They provide

exemplary facilities such as Baby sitting services, business center, coffee shop, restaurant,

catering service, children activity, doctor on call, signature spa, laundry service, florist and

much more. The striking design of the dusitD2 incorporates natural materials and textures in

80

a high-tech functional living environment where the emphasis is on spaciousness and

serenity.Conde Nas Traveler placed the hotel in their 10 th annual “hot list” of their top hotels

travel and top 40 city hotels in Asia.

The second Dusit D2 branch in Thailand is the Dusit D2 Baraquda Pattaya (Dusit D2

Baraquda Pattaya, n.d.). This hotel comprises of substance along with style, and was the only

finalist at FX awards in the UK, awarded Asia’s top ten new hotel 2009 as well as world’s

top twenty new hotel design 2009. Dusit D2 baraquda Pattaya combines Thai flair with

international standards creating a simply irresistible experience. All the 72 room designs are

fresh, cozy and intimate and provide a personalized called D’sire service for all. The facilities

at this hotel include: panoramic flat screen TV, cable TV, CD and DVD player, in-room safe,

mini bar, coffee and tea making facility, high speed wireless internet and so on. Apart from

great facilities, this hotel has a few noteworthy restaurants and bars such as the Deep Bar

(located underground), Pool bar, S.E.A restaurant (signature place), Sunset Lounge, as well

as D’lounge. The last two branches will be opened this year in Dubai as well as in Jaipur,

India.

Centara Boutique Collection: Within the brand, Centara has three branches in Thailand, and

one branch in Vietnam. The first hotel is the Nova Hotel & Spa Pattaya, which is a 4-star

hotel located in the heart of Pattaya.This hotel offers understated luxury with a good range of

facilities including a Fitness Centre and an extensive swimming pool complete with water fall

and its dedicated pool bar. The SPA Cenvaree, which is the highlight of the hotel, is known

for its therapeutic treatments such as the signature Dead Sea Mud Treatment. There is also a

unique Dead Sea salt bath where guests can relax and float just like in the Dead Sea. The

hotel accommodation consists of 79 trendy rooms and 1 Bedroom Suite, all of which are

overlooking the hotel swimming pool.

The next one is the Centara KhumPhaya Resort & Spa, which aimsto deliver a friendly

traditional Lanna style resort right to the heart of Chiang Mai. The design and architecture of

Centara KhumPhaya Resort & Spa are based on the Lanna (Northern-Thai) traditions and

customs, known for the Art of Teak Wood Carving used in the majority of the decorations.

Plus, in-room furniture and facilities are in Lanna style. The pleasant landscape consisting of

Thai mythological trees and flowers, some trees more than 100 years old, make Centara

KhumPhaya Resort & Spa a unique place to stay. They have also won the Outstanding

81

Design Award for Lanna Art Identity from the Tourism Council of Thailand in 2012 (Centara

KhumPhaya Resort and Spa wins the award, 2012).

The third one is the Away Suansawan Chiang Mai. It islocated in the beautiful Mae Rim

Valley, and is a superb resort offering a full range of recreational activities and facilities

including two swimming pools, spa treatment & massage, fitness center with sauna, and a

lakeside relaxation sala with library surrounded by nature. The resort has 47 rooms & villas

in huge surroundings with more than 1,000 trees, an impressive lake, 3 fishponds and many

garden areas. This resort offers guests a sense of calmness and lovely views over the

neighboring mountains; therefore, it is a perfect place to relax or to explore the well-known

Mae Rim Valley.

The last one is the Chen Sea Resort & Spa Phu Quoc.This beachfront 4-star resort is located

in a quiet bay, allowing the guests to enjoy the natural beauty of Phu Quoc Island. This resort

has only 36 rooms, consisting of 4 types: Beach view Villa, Beachfront Villa, Jacuzzi Villa,

and Sea View Pool Villa. Facilities include spa, sea view swimming pool, and fitness centre

and bar (Chen Sea Resort and Spa Phu Quoc, n.d.)

Analysis:

After analysing Dusit D2 branches as well as Centara Boutique Collections, both of them are

targeted toward people who are in search of new experiences. Furthermore, most of their

branches are located in Pattaya and Chiang Mai, which make them direct competitors. The

two branches in Chiang Mai under the Centara group are the Centara KhumPhaya Resort

&Spa and Away Suansawan Chiang Mai, and both have been opened for many years. Also,

Centara KhumPhaya Resort & Spa has won he Outstanding Design Award for Lanna Art

Identity from the Tourism Council of Thailand in 2012. However, on the other hand, Dusit

D2 Chiang Mai is considered a late mover because the hotel was opened in 2006, after

Centara. On the positive side, Dusit D2 has a good location as it is situated on a Famous

Street like the night bazaar. The hotel also provides numerous varieties of excellent rooms

and facilities and has won the award from Conde Nas traveler as well as one of the top 40

hotels in Asia. In Pattaya, Dusit D2 can be called the first mover since it opened in 2009. It

also provides many amenities, which the guests can enjoy. Moreover, the hotel won awards

such as “Top 6 hotels in Thailand 2010” voted by Destin Asia Magazine, being the world

luxury list 2010 in Amsterdam, winning “the stunning boutique design hotel from travel and

leisure travel pacific, and many more awards. When talking about Centara Nova Hotel % Spa

82

Pattaya, the facilities provided by this hotel are less varied than Dusit D2. Lastly, Centara can

be called the first mover since they expanded their boutique branch to overseas markets such

as the “Chen Sea Resort& Spa Phu Quoc, in Vietnam. The guests can enjoy the scenery and

sea view since it is located in the quiet bay. Also, Dusit Thani plans to open two more

branches in India and Dubai by this year.

Corporate Level StrategiesWhat business should Dusit compete?

Dusit’s main focus emphasizes on Hotel, Motels & Resorts industry and Lodging due

to the compatible nature of Dusit and the nature of these businesses.

Hotels, Motels & Resorts Industry

Competitive Landscape

Business and tourist travel drive demand. Both are affected by the strength of the

economy. The profitability of individual companies depends on efficient operations, because

many costs are fixed, and on effective marketing. Large companies have advantages in

economies of scale in operations, can more easily raise capital, and have strong name

recognition. Small companies, such as boutique hotels, can compete effectively in favorable

locations and by providing specialty services. The industry is labor-intensive: average annual

revenue per employee is about $90,000.

Products, Operations & Technology

Major industry product lines are room fees and sales of food, alcoholic drinks, and

merchandise. Room fees account for 75 percent of industry revenue, food for 15 percent, and

alcohol for 5 percent.

83

Lodging

Companies in this industry provide accommodations for vacationers and travelers.

Types of lodging can include hotels, motels, casino hotels, recreational vehicle (RV) parks,

rooming and boarding houses, and bed-and-breakfast inns. Some companies in this industry

also offer services such as laundry and meals on-site.

Dusit International operates various types of business under one brand; therefore, it is

operating in the categories of several business-level strategies. This strategy is called

diversification meaning that the company diversifies the business risk by operating other

related businesses. Therefore, the company can enhance strategic growth of the company as it

is able to maintain and expand its market share among other competitors. Additionally, Dusit

also expands its business in the overseas market such as in Philippines, Maldives, Unities

Arab Emirates, China, Egypt and India (Trade Arabia, n.d.). However, there are four main

aspects of corporate level strategies of Dusit International including product diversification,

value creation, level of diversification, and types of diversification and its advantage.

Corporate –Level Strategy: Diversification

Diversification is a strategy that takes a company into new markets with new

products, services, or stages of production to the existing business. The purpose of

diversification is to allow the company to enter lines of business that are either similar or

different from current operations. An accurate description of diversification is capitalizing on

a firm’s core competence and the strength of a successful brand to move into new markets. A

company's core competencies are the prized possession that give the competitive advantage –

for example, process knowledge and the acquisition of raw material that you turn out better

than ones’ competitors do (Business Mate. Org, 2010). Those extensions represent excellent

opportunities for diversification. To strengthen diversification, a new strategic business unit

must be capable of transforming and benefiting from the existing core competence to make it

difficult for competition to replicate.

There are many different reasons for companies to choose a diversification strategy,

for example; (1) companies might wish to create and exploit economies of scope, in which

the company tries to utilize its existing resources and capabilities in other markets. This can

often be the case if companies have under-utilized resources or capabilities that cannot be

easily disposed or closed. Using a diversification strategy, companies may therefore be able

84

to utilize all its capabilities or resources, and able to attract new business from market

segments not catered to earlier; (2) managerial skills found within the company may be

successfully used in other markets, where the dominant logic and managerial procedures of

management can be successfully transferred to other markets; (3) companies pursuing a

diversification strategy may be able to cross-subsidize one product with the surplus of

another. This way, companies with a very diverse portfolio of products catering to different

markets may potentially grow in power, and be able to

withstand a prolonged period of price competition etc.

When having subsidized one product for a substantial

period of time, the company might possibly be able to win

a monopoly, making it the only supplier in the respective

market; (4) companies may also want to use a

diversification strategy to spread financial risk over

different markets and products, so that the entire success of the company is not reliant on one

market or product only (Diversification Strategy, 2013).

However, it is important for companies to realize the possible danger of diversifying

its scope of operations too much. Companies might risk neglecting its core capabilities and

become too diversified, where too many different products supplied to different markets

might have negative effects on products and services, where e.g. product quality or

uniqueness might suffer due to the shift in focus on different products and markets.

The diversification strategy can be split into two different types which are related

diversification and unrelated diversification. Related diversification is one of the two variants

of diversification strategy. When making related diversification, companies expand their

operations beyond current markets and products, but are still operating within existing

capabilities or within the existing value network. When expanding into different products or

markets using existing capabilities, companies can create related diversification by using its

capabilities and resources in other settings (Diversification Strategy, 2012). Likewise, a

company might create related diversification by integrating into the existing value network.

For unrelated differentiation, it is a diversification strategy where companies expand their

operation into markets or products beyond current resources and capabilities. This strategy is

also sometimes referred to as the conglomerate strategy.

85

In this report, Dusit’s falls into related diversification strategy since it diversifies

products into the related field.

1. Product diversification

1.1 Hotel Management Business

Dusit International has set up a new standard of each hotel categories by re-branding its

company. However, each hotel business will be differentiated in terms of its own trademark

so as to be able to meet the target customers of each hotel business. There are five main hotel

business of Dusit International as following:

Dusit Thani

The company operates the 5- star hotels under the brand: ‘Dusit Thani’ which is a

company trademark. All the franchised agreements and hotel management are entered into by

Dusit Thani Plc. The company tried to enriches customer’s unique experience by creating

Thai culture and tradition. Therefore, Dusit Thani accentuates on Thai styles decorations and

services in every single unit of their hotel. Dusit Thani is delivered with distinctive Thai

artistry and graciousness that tends to personify the earthly manifestation of its name which

means in Thai, a town in heaven. In addition, Dusit Thani is trying to capture both the

business and leisure market at the same time. Especially, the business travelers group has a

lot of traveling experiences as they have well succeeded in life. Thus, business travelers come

with high expectation as they would be expecting excellent services from the hotel that reflect

greater preferences. As a result, by creating Thai culture and tradition, Dusit Thani wants to

provide Thai hospitality with local sense to all their customers. Furthermore, there are

currently six Dusit Thani branches in Thailand, and there are eight branches in overseas

including the upcoming projects for the next one to three years (Muuay, n.d).

Thailand-based branches

Dusit Thani Bangkok

Dusit Thani Bangkok: Almost 40 years, the famed Dusit Thani Hotel has been a 'social and

business' landmark in Bangkok. Its international standards delivered with distinctive Thai

86

artistry and graciousness personifies the earthly manifestation of its name which means in

Thai, a town in heaven.

Dusit Thani Pattaya

Dusit Thani Pattaya is a five-star resort hotel that provides a unique blend of coastal leisure

and city activity in Chonburi, Thailand, on the Gulf of Siam.

Dusit Thani Huahin

Dusit Thani HuaHin Hotel has been accorded a reputation as the Thai beach resort of choice

for Thai aristocracy.

87

Dusit Thani Laguna Phuket

Dusit Thani Laguna Phuket hotel is an idyllic retreat tucked away on the stunning island of

Phuket. The resort is a jewel in the crown of the Laguna resort development at Bang Tao

Bay, Phuket, Asia's first integrated resort development.

Dusit Thani Island Resort Chiangmai

Dusit Island Resort Chiang Rai hotel is situated on an island in the Mae Kok River that owes

through central Chiang Rai, Thailand’s northernmost province.The hotel's decor and

furnishings also reflect the diversity of northern Thai styles.

88

Overseas Branches

Dusit Thani Manila Philippines

Dusit Thani Dubai United Arab Emirates

Dusit Thani Lakeview Cairo Egypt

Dusit Thani Abu Dhabi

Dusit Thani Hainan China

Dusit Thani Maldives

Dusit Thani Goa India

Dusit Thani Jeddah Saudi Arabia

Dusit Princess

The ‘Dusit Princess’ brand will be used in management of 4-star hotels and operated

under Dusit Thani Properties Plc. Dusit Princess represents Thai contemporary styles and it

tends to target on middle class businessman who pursues quality hotels, luxury travel,

89

signature restaurants, friendly services, convenience, fair room rate and customers especially

want to sense a Thai tradition. In addition, Dusit Princess Hotels are located in great locations

which make it very convenient and accessible to all travellers traveling and nearby travel

attractions. Moreover, all the employees of Dusit Princess have lots of knowledge about the

place in details as each and every branch of Dusit Princess is built with strong relationship

with those cities or locations. Consequently, Dusit Princess are seven branches throughout

Thailand as the following:

Dusit Princess Chiangmai

Dusit Princess Srinakarin

Dusit Princess Korat

Royal Princess Larn Luang

Pathumwan Princess

Brand China Princess

Bel-Aire Princess

DusitD2

90

Dusit D2 is a 5-star boutique hotel where it focuses a lot on providing exceptional

services and modern style of decoration. DusitD2 is the second generation brand of Dusit

Thani Hotels & Resorts, representing a new concept in balance between tradition and trend,

with international high standards and warm hospitality that is distinctly Thai. DusitD2 tends

to target on new generation travellers who want choices and flexibility. For these types of

customers, it does not matter whether are they are traveling for business or leisure purposes

they see new authentic experiences, comfort, style, high quality and modern from the hotel.

Additionally, the combination of three components creates the uniqueness of DusitD2 which

includes excellent services, coming up with new ideas for product improvement and modern

style decoration. Moreover, the first property in the DusitD2 collection opened in November

2006 in Chiang Mai. It is the boutique hotel where embrace with modern and lively

atmosphere. DusitD2 chiang mai is a ‘D’ynamic, ‘D’esirable, and ‘D’lightful blend of

serenity, individuality and modernity that is authentically Thai. Currently, there are two

branches in Thailand and 2 more branches in overseas which will be opened in next year

which includes:

DusitD2 Chiang Mai

DusitD2 Baraquda Pattaya

DusitD2 New Delhi India which will be open this year (2013)

DusitD2 Goa India which will be open this year (2013)

Dusit Devarana

Dusit Devarana is a 6-star hotel where it focuses a lot in providing outstanding

services to all its customers. The hotel tried to provides services in such a way that exceeds

91

customer satisfaction and reach up to their expectation where they emphasized a lot on

providing customized- services to their customers. Dusit Devarana tends to target on people

who pursue balance in life as Dusit Devarana are designed to provide its guest with

surrounding where they can isolate and de-stress themselves so to be able to recharge and

have the ability to re-join with the everyday life having an empowered body and mind.

Moreover, money and success cannot bring customers the true happiness if they suffered

from lack of flawless mind and body. However, they is one Dusit Devarana in Thailand and

four branches in overseas which will be opened within the next two years which includes:

Dusit Devarana Eight Heaven Resort Phang Nga

Dusit Devarana Rishikesh India

Dusit Devarana Jaipur India

Dusit Devarana New Delhi India

Devarana Hainan China

Dusit Residence

92

Dusit Residence is a 5-star hotel that is currently operated for long-stay customers.

Dusit Residence tends to target on long stay businessman, travellers and foreigners. Dusit

Residence tend to attract their guest to stay longer as they provide outstanding services and

prompt facilities that completely meet their needs and the hotels decorations and services

aims to create a warm atmosphere for the guests which makes them feel like they are at

home. They provide an environment of relaxed comfort. Consequently, long stay travellers

can help the hotel generate more revenue and hence profitability for the company. However,

currently there are only three Dusit Residence in Dubai, UAE namely:

Unfurnished Apartment at Dusit Thani Dubai

Dusit Residence Dubai Marina

Pearl Coast Premier Hotel Apartments

1.2 Education Business

Education in the hotel and hospitality industry has been from the very beginning a

vision to which Thanpuying Chanut Piyaoui has devoted a major part of her career. If

Thailand is to be among the world’s leaders in the hotel and hospitality industry, the

education and training of staff would be of the highest importance

Dusit Thani Plc has established an education business for the purpose of offering

employees continuing education opportunities. This is because a well trained workforce is an

important productivity enhancement. They know that tuition reimbursement and specialized

training courses enhance their professional prospects and make them more marketable. This

education benefits shows that a company truly values its employees and their future (Hakala,

2008). Therefore, producing efficient human resources will ensure the company to support

the expansion of Dusit Thani Group and tourism and hospitality worldwide. Moreover, the

business will be operated in lots of province in Thailand and in other countries where Dusit

Thani hotels are located at. As a result, the company is able to provide competent workforce

to work with the hotel especially for Dusit Group. The two main educational institutions of

Dusit International are:

Le Cordon Bleu Dusit Co., Ltd.

93

In August 2007, Dusit is a joint venture with the world’s leading hotel and culinary

education institution, Le Cordon Bleu. This new alliance among Dusit, Le Cordon Bleu, and

Dusit Thani College is destined to become Bangkok’s most modern and complete culinary

training of a scale and scope never achieved before in Thailand, or even the rest of the region.

The Le Cordon Bleu Culinary School has been accredited by the Ministry of education. The

school is a modern state-of-the –art facility offering all the standard Le Cordon Bleu

programme as well as a Professional Thai Cuisine programme unique to Le Cordon Bleu

Dusit. All classes are taught in English and the school accepts both Thai and international

students from all over the world. Presently, there are graduated Thai and foreign students of

around one thousand people per year and the institutions opens four trimesters a year.

Currently, there are more than forty schools in twenty countries worldwide (Dusit

International, 2013). Thus, Le Cordon Bleu is the famous culinary institution from France

where opened for more than one hundred and fifteen years. Also, Le Cordon Bleu is ranked

to be one of the best three culinary institutions in Asia after the cooperation with Le Cordon

Bleu.

Dusit Thani College

94

Tourism is one among various vital parts of Thai economy, and the future of tourism

depends greatly on hospitality education in order to meet the growing demands of tourists and

the tourism industry. Regardless of how the world changes, Thailand represents the epitome

of hospitality warmth and charm, and Dusit Thani College is the premier institution to bring

these concepts through superior service and excellence to Southeast Asia. Dusit Thani

College was established in 1993 by Dusit Thani Hotel and Resort Group. In addition, Dusit

Thani College recognizes that experience is very important in industry, and a work placement

period of at least two months is a part of curriculum (Dusit Thani College, 2008). In

addition, a Training and Development Center is encompassed within the college, providing

services for students, the local hospitality industry, and the general public, by providing short

courses and specialized educational programs. Also, Dusit Thani College sustainably

develops and offers high quality education with highly competent graduates who acquire

first-rate professional skills, creativity and innovative outlook. Moreover, Dusit Thani

College has coordinated with Le Cordon Bleu Halvetia Sarl to bring the culinary course of Le

Cordon Bleu to combine with the course of Dusit Thani College. To illustrate, a new

internationally accredited Bachelor’s Degree program and other Culinary Arts courses will

also be offered at the Dusit Thani College, and therefore making another major innovation in

these areas. Furthermore, Dusit Thani College has also established a Mini MBA programme,

in cooperation with Dusit’s distinguished training centre, Dusit Executive Development

95

Center, which was established to provide top-level executive training courses and customised

programmes to individuals and various organizations specializing in the hospitality industry

which includes Executive Program in Hotel Management, Hospitality access program for

three months, Thai Culinary Program and Hospitality Management (Dusit International, n.d).

1.3 Training Business

In August 2004, the training business is operated by a subsidiary company named

Dusit Executive Development Center Co. Ltd. The company’s objective is to train, organize a

seminar and develop the knowledge in order to build potential and capacity of the work force

for both Dusit Group and the public. Since human resources are the most powerful sources

thus training is essential to develop human resource of Dusit International by conducting a

seminar for high-level management workers and to make full use of employee’s abilities and

potentials in order to help achieve the organization objective. Moreover, they also provide

training for middle level management. This is because middle level managers have a

profound impact on the culture, stability and productivity of workplaces (Brassfield, 2013).

Therefore, it’s crucial they be committed to the goals of the company and can effectively

execute these goals through effective management of their direct and indirect reports and also

to be ready to work with the newly opened Dusit hotel in the coming future.

1.4 Spa business

The spa business is operated by a subsidiary company, Devarana Spa Co., Ltd.

Currently, there is one spa branch, which is Devarana Spa Bangkok located at Dusit Thani

Bangkok. This company has also been engaged to manage another 4 spas, located at Dusit

Thani Pattaya, Dusit Thani Hua Hin, dusitD2 Chiang Mai and Dusit Thani Manila in

Philippines.

Devarana Spa

Devarana spa offers an atmosphere of ultimate relaxation in its very own healing

‘Garden of Heaven’. It aims to create and improve spa within Dusit’s five –star hotels. The

business emphasizes on providing luxurious pampering and healing treatments. In addition, it

is decorated with the contemporary Thai design and décor which invite guests to experience

the everyday world, providing a relaxing and welcoming atmosphere in which to enjoy

96

premium spa treatments with traditional Thai service and hospitality. All treatment rooms

provide beauty, comfort and privacy for the entire guest to share their spa experience. As a

result, Devarana Spa is ranked to be one of the top spas in Asia Continent with these unique

concepts (Dusit Thani, 2010).

Devaran Spa Bangkok at Dusit Thani Bangkok

Devaran Spa Huahin at Dusit Thani Huahin

Devaran Spa Pattaya at Dusit Thani Pattaya

Devaran Spa Chiang Mai at DusitD2 Chiang Mai

Devaran Spa Manila at Dusit Thani Manila

Devaran Spa Maldives at Dusit Thani Maldives

Devaran Spa under new ultra-luxury hotel IL SALVIATINO Italy

Nam Spa

Nam Spa, traditional techniques are offered massage and treatments such as Thai

massages, refreshing herbal exfoliations and Aromatherapy. In addition, it is another health

entertainment spot of Dusit International which operates for four-star hotels. The decorations

and services provided by Nam spa are simple and uncomplicated. However, there is only one

branch of Nam spa which is at Dusit Princess Korat.

2. Market development

Market develop is a marketing technique aimed at increasing a company's market in

order to widen the customer base for the purpose of selling more products. There are several

approaches that can be used to make a market larger, ranging from capturing customers of

rival companies to expanding to a previously unserved segment of the market. These

practices are organized and driven by marketing personnel who can work within a company

or be consulted specifically to assist with market development.

When a company believes that it has a need to increase the size of its market, the first

step is usually a development of a profile to find out what segments of the market are

currently being served. This study includes an analysis of the kinds of customers the

company has and what those customers are buying. This information is used to develop an

97

efficient and comprehensive market development strategy. Companies must use cost effective

strategies so that they do not end up spending more money developing a market than they

could potentially earn by expanding the market.

One aspect of market development involves getting current customers interested in

products and services that they are not currently buying. This includes newly launched

products and services. Such customers can be a potentially easy sell because they already

have a relationship with the company and may be predisposed to expand that relationship.

Another tactic requires identifying consumers who buy from rival companies and finding

ways to appeal to them, such as offering targeted promotions.

Customers who are not buying a product or service at all are a potentially untapped

market. Market development can focus on introducing them to a company or brand to get

them interested so that they will become customers (Market Development, 2013). Finally,

companies can expand their markets. If a company is only selling in one region or focusing

on a given demographic, it can expand its reach to increase the size of its market.

Developing a strong market development strategy is an important aspect of helping a

company grows. If companies are limited by only having a small share of the market, they

can find it difficult to sell more products, raise capital, and expand their operations. Small

companies with limited marketing experience may turn to consultants for this, while

experienced large companies have internal marketing departments that may be responsible

for market development. It is an on-going part of doing business for successful companies.

98

Hotel businesses Geographical diversification

China:

Dusit International is developing a second project in China, Dusit Devarana Hainan,

scheduled to launch this year 2013, the 300-room resort is unique located within the rare

natural ninety three degree Celsius hot springs and will showcase various spring-water

features, from outdoor bathing pools to en suite bathrooms supplied with fresh hot and cold

spring-water which will be located in the “Seven Fairy Mountain” region of Hainan Island,

around 80 kilometres from China’s southernmost city Sanya. Additionally, a natural

mountain river will run through the low-rise complex. By the mentioned reasons, Dusit could

be reputable in Chinese market as high-end hotel brand. Working with China is becoming

very essential strategy for hotel industry. Dusit would be able to go International easier

especially in China because China is the fastest developing country in Asia (Elliott, 2013).

99

India:

Dusit International announces its first track expansion to India opening five hotels and resorts

in New Delhi, Jaipur, Rishikesh, and Goa by this year 2013. The expansion plan into this

country pilots the company’s first-ever Dusit Devarana, the most luxurious brand under Dusit

International umbrella (Dusit International, n.d.). The reason for expanding in India is

because India is one of the Asian countries that Dusit has continuously expanded its hotel

brands which include Dusit Thani, DusitD2 and Dusit Devarana. In addition, since India is

now ranked one of the top ten largest countries in the world and for Dusit to expand its

brands they can capture larger target markets. Based on the survey, the project of hotel

industry predicted that Indian consumers continue to enjoy double digit in per capita income,

while the population of high net-worth individuals has grown over 80% in the last five years,

said DilipPuri, Managing Director and Regional Vice President of South Asia. Moreover, the

number of domestic travel increases and Indian travellers continue to demand more

sophistication in terms of both quality and experience, and therefore, Dusit has got the

opportunity to grow their luxury brands. Furthermore, the hotel can gain a competitive

advantage over other competitors if it is located in the religious destination since there will be

high demand and supply of hotel industry. As a result, this provides Dusit with an

opportunity to expand its hotel brands and to gain larger market share (Hotel News. Com,

2013).

100

Maldives:

Dusit International has confirmed the opening of Dusit Thani Maldives surrounded by a

vibrant 360-degree coral reef and turquoise lagoon, this island property features pearl white

sandy beaches and a rich landscape of verdant vegetation. Dusit Thani Maldives is considered

a landmark addition to this fast expanding brand. Dusit International has expanded in

Maldives is because Maldives is becoming one of the must-visit destinations in the world.

The main tourists who are likely to travel to Maldives are those with high spending power.

Dusit will gain benefits by targeting this market as this will help Dusit to generate revenue

and to earn popularity (Dusit Thani Maldives, 2012).

101

United Arab Emirates:

Dusit Thani and Dusit Residence have emerged its hotel business in the UAE since UAE is

the country with people that have a high spending power. Therefore, for Dusit to target this

group of customers, they can gain more profit from its businesses by these markets (Dusit

International, 2012).

Spa business

Devarana Spa has been expanded into Maldives and Italy which are the first countries to

establish Devarana Spa. Consequently, Dusit would be able to target more customers in

Asian and European market.

102

3. Level and type of diversification

Diversification is a form of corporate strategy for a company. It seeks to increase

profitability through greater sales volume obtained from new products and new markets.

Diversification can occur either at the business unit level or at the corporate level. At the

business unit level, it is most likely to expand into a new segment of an industry that the

business is already in.Additionally, diversification is a technique that reduces risk by

allocating investments among various financial instruments, industries and other categories

(Diversification, 2011).It aims to maximize return by investing in different areas that would

each react differently to the same event. Most investment professionals agree that, although it

does not guarantee against loss, diversification is the most important component of reaching

long-range financial goals while minimizing risk. There are two different types of risk

Different Types of Risk

Undiversifiable - Also known as "systematic" or "market risk," undiversifiable risk is

associated with every company. Causes are things like inflation rates, exchange rates,

political instability, war and interest rates. This type of risk is not specific to a

particular company or industry, and it cannot be eliminated, or reduced, through

diversification; it is just a risk that investors must accept.

Diversifiable - This risk is also known as "unsystematic risk," and it is specific to a

company, industry, market, economy or country; it can be reduced through

diversification. The most common sources of unsystematic risk are business risk and

financial risk. Thus, the aim is to invest in various assets so that they will not all be

affected the same way by market events.

In terms of Dusit International, it has quite small business diversification comparing

with other big chain hotels such as Starwood and Marriott. Moreover, hospitality businesses

are related to each other in terms of hotel business, education business, training business and

spa business. Dusit can spread the risk in each business operation by having various

businesses operating under the same company. To illustrate, Dusit International, the most

common sources of unsystematic risk are business risk and financial risk. Thus when one

business is in crisis, the others can still support the company and prevent bankruptcy risk. As

103

a result, Dusit International has high level of diversification in terms of products, distribution

channel and technology can be described as following:

Product

Dusit International offers a variety of goods and services no matter if it’s spa

business, education business or even hotel business. In terms of spa business, which is

Devarana Spa meaning “garden in heaven” and it will excite the senses and make spa lovers

feel truly special as if you are in heaven. Dusit Thani offer a unique product called Devarana

Spa and it is offered only in Dusit Thani and DusitD2 hotels and resorts. However, the

services which are offered to the guest include water treatments, facials, body scrub and

various other massages. Additionally, it also retails its spa products to the guests such as spa

bath, body treatment and blended oil, apart from just offering spa cuisine products to

customers ranging from soup and salad to herbal drink. For education business, Dusit offers

various education choices and courses. To illustrate, a new internationally accredited

Bachelor’s Degree program and other Culinary Arts courses will also be offered at the Dusit

Thani College, and therefore making another major innovation in these areas. Furthermore,

Dusit Thani College has also established a Mini MBA programme, in cooperation with

Dusit’s distinguished training centre, Dusit Executive Development Center, which was

established to provide top-level executive training courses and customised programmes to

individuals and various organizations specializing in the hospitality industry which includes

Executive Program in Hotel Management, Hospitality access program for three months, Thai

Culinary Program and Hospitality Management (Dusit International, n.d). However, besides

from Dusit Thani College, Dusit is a joint venture with the world’s leading hotel and culinary

education institution, Le Cordon Bleu.Le Cordon Bleu Dusit also offers both weekday class

and Saturday class to students for various courses including cycle class, Barista, Diploma

Professional Bakery and Diploma Thai cuisine. As a result, Dusit has a better coverage of the

market share as it has quite diversified products and services. Lastly, in terms of hotel

business, every hotel type has the same standard of having swimming pools and Dusit fitness,

however, other products and services will be different depending on the hotel class and

location. Thus, Dusit offers the hotel business ranging from four stars to six stars. To

illustrate, Dusit Thani is five star hotels which offers 11 restaurants, nine room types, spa and

eight meeting venues. In contrast, Dusit Princess in Bangkok is four stars hotels which offer

three rooms types which include Executive Suite, Deluxe Room and Junior Suite which also

104

includes six restaurants and bars, eight meeting venues, fitness and spa to the guests.

Consequently, Dusit Thani is definitely more diversified than Dusit Princess.

Technology

Dusit want to operate at its best efforts to customers and at the same time they try to

reduce some cost of its operation by using various technologies within its operation. Firstly,

Dusit Thani has acquired a software system called OPERA Central Systems solution by

signing a contract with Micro- Fidelio in 2007. They have a binding contract with this

company as their supplier of Information systems and software updates. This contract made

Dusit Thani the first Hotel in Thailand to possess this software system. This system includes

quick and efficient functions that are easy to operate and as well as easy to train their new

front office staff to be familiar with the system. In addition, Dusit use Opera Central System

Solution to distribute information about customer reservation right away to every Dusit hotel.

The system includes Opera Reservation System (ORS), Opera Customers Information

System (OCIS), Opera Web System (OWS), and Opera Sales Force Automation (SFA). By

using this information system would allow each Dusit international hotel chain to directly

connect to every customer through all distribution channels globally such as travel agency,

online booking, hotel website and telephone.Moreover, the hotel would be able to respond to

the customers and give out information about their reservation right at the moment the

customers make reservation. This can help the hotel to save time, unnecessary costs as well

as ease of complex procedure for both hotel and customers (Opera Central System, 2009).

Also, Dusit uses Digital Private Library website which is www.leonardo.com that collects

and distributes digital images to all the customers worldwide and to all Dusit’s hotel chains.

Therefore, Dusit can reduce its expense from using the normal mailing method. Furthermore,

Dusit Thani has made a development by becoming a partner with IDeaS revenue Solution to

help them manage revenue. Dusit International is installing the IDeaS Revenue Management

System (RMS) at certain properties, and the IDeaS Forecasting Management System (FMS)

at other properties when working with IDeaS. The combination of the two systems provides

Dusit International with accurate pricing and a clear vision to their data across all hotels,

creating a solid platform to build a strong organizational-wide revenue culture. Moreover,

Dusit International has recognized that having the right technology and strategies in place

when it comes to business forecasting and pricing is critical, given the growing levels of

competition in the regional and local hotel sectorassumptions (Dusit Partners IDeaS, n.d.).

105

Lastly, Dusit has installed Wireless Hi Speed Internet Connection called Dusit Connect for

the guests’ use.

Distribution Channel

Dusit has continuously improves and diversifies many of its distribution channels in

order to be able to deliver the products to their target customers since Dusit operates various

brands. Currently now most of the hotels tend to focus on online distribution channel is

because the usage of internet in hospitality industry can be used as a major marketing and

communication tools in this business world. Many of the hotels now have started using e-

commerce as their business tool. They also started to redefine their roles and operations in

order to provide better service to the changing needs of customers (Harketi, 2011). To

illustrate, Dusit Thani International also focus on online distributional channel and Dusit is

using electronic (e-distribution) channels in order to be able to provide better and faster

services to customers. As this will help increase the profitability to both customers and Dusit

to build a better relationship between them. Dusit International ensures that their brand is on

the top ranking of search engine and they had enhanced their Search Engine Optimization

system for its own website that is www.dusit.com since 2008. Additionally, Dusit tried to

remove all language barriers by as they provide all forms of languages for their target

customer including Japanese, Chinese, Thai, Arabic and English. Moreover, for Dusit

International, www.dusit.com has become one of the most significant selling channels. Also,

the company has used an extensive sales strategy (RSO or regional sales office) which

include both local and overseas sales representatives such as Shiang Hai and Dubai.

Furthermore, in order to book sales and reserve room in a faster manner, the company has

installed the key account management system that is providing access to all marketing and

worldwide sales representatives. Apart from this Dusit International is also a member of

Global Hotel Alliance (GHA) to better serve their clients. GHA consists of 140 upscale and

luxury hotels and resorts, spread over 41 countries. Each brand is a key player in their main

region such as Dusit International in Thailand, Kempinski in Europe, Landis in Taiwan &

China, Marco Polo in China and Hong Kong, and Pan Pacific in the Pacific Rim. Through

www.globalhotelalliance.com the member of GHA can make online hotel reservation as well

as airline reservation. By choosing GHA travellers can be sure that they will have a unique,

local experience in a four or five-star hotels while receiving consistent levels of service and

recognition, regardless of their choice of hotels. Dusit Gold Card Members are entitled to

receive member benefits of the participating Global Hotel Alliance hotel’s program they are

106

visiting. In addition, as GHA expands its network of member hotels, Dusit Gold Card

Members will have even more destinations to experience the special benefits offered by

member hotels (Opera Central Reservation system, n.d.). Moreover, the company also

participates with Tourism Authority of Thailand offering a special rate for people who buy

the package at the events. As a result, sales volume increases a lot higher than doing nothing

with TAT. Customers will have a chance to try to stay with Dusit and experience how Dusit

commits to serve them. Furthermore, Dusit use travel agents as another distribution channels

and they offer travel agents at a special rate. Therefore, travel agents will automatically

receive forty percent off for Best Available Rate whenever they want to book the room for

the guests. Also, Dusit is a member of online travel agency which AGODA. Agoda is another

essential distribution channel for the company but the company needs to pay annual fees for

the AGODA.

4. Economies of Scope

Dusit is growing their businesses into related field. Therefore, they can use and share some

products and resources, technologies and distribution channel.

Sharing of resources within the company.

Sharing Services and products.

Dusit Thani share their products and services between different sections of their

business. The main reason for such action is to save cost within the organization through

efficient use of resources. For example Dusit Thani provides a single shuttle bus service to

serve as a convenient transportation option to the tourist. It is called ‘Dusit Sprinter’. It is an

11-seater Mercedes-Benz that provides large seats to cater to customer’s comfort while

utilizing it and enjoying 5-star service experience. It includes Complimentary drinking water,

air-conditioning, magazines and full insurance coverage. The Dusit Sprinter will transport

guests from Dusit Bangkok to Dusit Hua Hin and Dusit Pattaya and back. By sharing

transportation links between branches it enhances the service quality as well as save cost

rather than having individual transportations. Another example would be the bath kits in the

guest rooms. Those products are the same products used in Dusit Devarana Spa. The products

are made in the spa and also supplied to the hotels guest rooms to avoid outsourcing these

products and control the flow of resources as well as costs within the hotel. This also helps in

107

promoting their spa service by acting as attest product

within the guest’s bathrooms. The hotels also advertise all

their hotels under one name, which is Dusit International.

Combining promotion as one cost this means they save

each other. This also raise the idea of standardization that

customer can expect the same kind of service in all the

branches.

Brand

The hotel obviously shares a very important aspect of their intangible recourses. That

is the strong holding brand of Dusit Thani. Dusit has a strong and well trusted reputation that

is well known in Thailand and in the process of world expansion with the perception of a

strong world famous Thai hospitality Hotel. With over 60 years in existence and experience

reputation and loyalty was built over time with the fact that a member of the royal family

owns it. For this reason it can influence easier decisions from customers who come across the

brand. For example, when they see D2 and the fact that it is a product of Dusit International

they may feel comfortable in choosing D2 because of the familiarity of the brand.

Employees

The work force is one of the major activities that Dusit does to ensure the circulation

of talents and the Dusit set of mind within the organization. Dusit Thani has its own training

center and educational institution. The Dusit Thani College and their training center aim to

produce well-trained employees with the Dusit Thani organizational service standards. This is

to maintain the Dusit Thani standard quality and intern aim to support Dusit Thani’s

productivity. This saves valuable time for training their newly hired staff as they recruit

internally to be able to put their trust on their college graduates, which makes it easier. Dusit

Thani would avoid the cost of training staffs that might lack in experience as well as in

recruitment and selection process. By being able to share interns and the newly graduated

workforce they can assure the Dusit Thani standard has already been thought and don’t have

to waste time or money to train them again. Dusit Thani also share workforce between their

branches and support each other during absentees or vacant space ion the job. For example if

Dusit Thani Manila needs a receptionist and Dusit Thani Dubai has an extra receptionist.

Arrangement can be made to transfer him/her to Manila or vice versa.

108

Sharing technology

IDeaS Revenue Solution

IDeaS is another type of system that Dusit hotel business shares with each other. By

using IDeaS Revenue Solution as to be able to enhance its demand forecasting and boost

revenue performance in their Asian-based properties.Dusit International is installing the

IDeaS Revenue Management System (RMS) at certain properties, and the IDeaS Forecasting

Management System (FMS) at other properties when working with IDeaS. The combination

of the two systems provides Dusit International with accurate pricing and a clear vision to

their data across all hotels, creating a solid platform to build a strong organizational-wide

revenue culture(Dusit Partners IDeaS, n.d.).

Google Analytics

Google Analytics (GA) is a service offered by Google that generates detailed statistics

about a website’s traffic and traffic sources and measures conversions and sales.

Consequently, GA is being used in the Dusit’s website. GA can track visitors from all

referrers, including search engines and social networks, direct visits and referring sites. It also

displays advertising, pay-per-click networks, e-mail marketing and digital collateral such

109

aslinks within PDF documents. As a result, all hotel business shares the website together that

is www.dusit.com thus this enables them to track the visitors behavior (Products and Services

Supplies, 2005).

Central Information System

OPERA Central Systems Solution is the system that all Dusit’s hotel business uses to

distribute information about customer reservation right away to every Dusit hotel that

includes Dusit Thani, DusitD2, Dusit Princess, Dusit Residence and Dusit Devarana. The

system includes Opera Reservation System (ORS), Opera Customers Information System

(OCIS), Opera Web System (OWS), and Opera Sales Force Automation (SFA). By using this

information system would allow each Dusit international hotel chain to directly connect to

every customer through all distribution channels globally such as travel agency, online

booking, hotel website and telephone. As over 500,000 travel agencies worldwide would be

able to access to the hotel’s Opera Central Reservation system this can also lead to the

increase in reservation volume and gain more market share worldwide. Consequently, Dusit

can reduce its cost from using this system as this system also provides efficient and effective

management to the company resulting in easier managing customer information, global sales

and higher service standard (Opera Central System, 2009).

110

Sharing distribution channel

Official Website

The website is the main distribution channel that all Dusit’s hotel brands share

together. As you can see itself from this official website, there are links of each hotel brand in

every branch provided for customers to serve. Through this website, it very convenient and a

fast way for both the customers and the hotel to manage the reservation information. As it is

very easy for customers to access the websites and can book the room and specify the date in

the website itself.

Online Travel Agencies

AGODA is the online travel agency that is used by Dusit International in order to

offer more choice of online booking. Additionally, the hotel can pay fewer fees than other

brands, by using AGODA for the whole hotel businesses of Dusit International. Agoda

provides precise information that is suitable for the target market and provide information

that customers are looking for. Also, they provide a lot of pictures with a brief description

under each. Furthermore, AGODA always keep its brand popular by encouraging customer to

111

join their through website as they set up an event and let customers vote and those who win

will be provided with free accommodation.

Promotion

Dusit Thani does their promotion collectively. Promotion is a very important aspect of

the business and might be the most important distribution channel that helps spread

awareness through the market. Dusit Thani mainly combines their promotion activities,

meaning they tend to utilize on promotion to promote many of their brands for example,

when Dusit Thani advertises Devarana spa through any king of media they will advertise it

together with. For example when Dusit Thani try to advertise for their Fitness center they

would advertise the spa simultaneously for customers to cool down and have a relaxing

experience right after their workout session. This will generate a higher number of sales

volumes and an increasing spa visits by customers. As a result Devarana spa can become

more famous in the market. If the customers liked the spa they will spread word of mouth

about the positivity of the spa service. Therefore they use a common promotion to promote

all their brands so customers who are watching it will have more variety of choice and will

certify the same standard through all the products. DBR or Dusit best rate, allows customers

to use ‘Click its Magic” this is a discount for first night stay in Dusit it also used to discount

for the payment of food and beverages. Dusit Thani uses their promotion strategy to cut cost

and aim to increase the impact of the promotion.

112

Regional Sales Services

It is said to be tool to increase profitable efficiency of the company. Dusit has opened

the regional sales office at China, Hong Kong, and Europe etc. The main aim of establishing

this office is to promote and sell Dusit International products in the oversea market.

Moreover, it would become much easier for the foreign customer to know more about each of

the offering business as all the business will be promoted as Dusit International brand (Dusit

International. n.d.).

Asian Hotels Alliance (AHA)

An Asian Hotels Alliance directory has been developed and will be widely distributed

through hotel guest rooms and business centers as well as each company's regional sales

offices and marketing partners. "The AHA Directory will give each member hotel a market

exposure that is significantly greater than what could be done as an individual hotel or hotel

group. Additionally, Asian Hotels Alliance is another distribution channels that are being

used by Dusit International. Dusit is eligible to use the group as online booking channel by

being one of the members of the AHA. Moreover, it has become very convenience for

customers as it will allow customers to search for room availability, take advantage of special

113

offers and confirm room reservations at the hotel of their choice via www.ahahotels.com

website (Asian Hotel Alliance, 2004).

4. Value creation

Cost effectiveness:

The strategy creates value to the company by operating related diversified business operation.

Dusit has got more opportunities to share both in terms of tangible and intangible resources

which result in reducing the cost of operation as it has enhance the effective use of the

existing resources. To illustrate, Dusit does not have to spend huge amount of investment on

human as it’s just a small problem but for other companies can perceive as a big problem.

The reason being is that Dusit produces its own workforce as they have their own institution

which Dusit Thani College which is a college for hospitality and support them by providing

intensive training courses to all the students. Consequently, the company can hire the newly

graduates students to work at Dusit. As a result, the company could reduce much of its

expensed that is by reducing the cost of recruitment, selection and training or even hiring the

trainers from outside to improve the workforce. On the other hand, apart from human

resources, the company has reduced much of its expenses in terms of sharing technology

uses, equipment, and advertising among its hotel business.

Stronger brand:

Dusit brand become stronger along with the businesses diversification. Dusit has

expanded its business in terms of hotel business and spa business under ‘Dusit International’,

thus the company continues to get bigger in the industry. Dusit tend to target broader market

and thus lots of different types of customers are now being aware of the brand more than ever

114

before since now the company tend to target those group of customers too who they have

never targeted before. Additionally, if customers are happy with the services or if they have a

good experienced while they stay at the hotel then they are likely to choose the product of

Dusit. For example, DusitD2 is a five-star boutique hotel which is located in Chiang Mai and

Pattaya. Those guests that are highly satisfied with the service received tend to be repeated

guests of Dusit Thani who would choose to stay with DusitD2 since the services that was

provided to them have exceeded their expectations. Consequently, Dusit could gain the value

from its own business expansion through the brand recognition.

Higher Profit Margin:

By diversifying its businesses, the company would be able to gain a much higher

profit margin. This is because if the company offer various choices for customers, the hotels

are likely to gain more profit than just operating one business type. For instance, the hotel

business covers all classes of the customers excepting budget customers ranging from four to

six stars hotels. Thus, different types of customers would prefer different hotel types that fit

with their needs and wants. Additionally, in terms of spa business, Thai spa has been

recognized as one of the top five services in the world and the foreigners tend to spend a lot

of money on spa especially for the Europeans guest which is one of the target customers of

Dusit Thani. Also, Devarana Spa is one of the products that are being known and popular for

Dusit Thani loyal customers. Moreover, to make its spa business more well known amongst

customers and in order to increase the profit margin for its spa business, Devarana spa is

expanded to Europe,opening at the new ultra luxury hotel Il Salviatino, Florence in June

2009. The brand’s European expansion is through a joint venture with International

development and management company MPg, which specializes in small luxury hotels. As a

result, spa business has also enhances the profit margin of the company (Dusit International,

n.d.). Thus, the reputation can increase the competitive edge for Dusit International once the

spa businesses are well recognized by the European market.

115

More effective channel distribution system:

The company is likely to improve its distribution channels together with the business

operation, since the company tends to share the same distribution channels for its diversified

businesses. Companies with productive distribution channels stand to increase sales, reduce

operating costs and improve customer reach. Also, the company realizes the importance of

effective distribution channel management that delivers benefits to all players in the value

chain, often by increasing the size of the market or capturing a greater share of customer

wallet through the channel. It is one of the main indicators for the overall performance of the

company. This is because proper distribution planning can ensure that the best available

channels and distribution methods are in place to efficiently distribute products and services

to customers (Haraketi, 2011). However, poor distribution system can lead to failure to reach

end users or to communicate with those end users through distributors effectively which

leaves the door opens for competitors to outperform over your business. In other words,

mistakes in the distribution chain can directly affect the top and bottom line in the short term

and the industry’s competitive dynamic in the long term. To prevent failure in its distribution

system and with the ever-fast changing technological landscape, the company has made

Dusit.com a priority for the future of the company. Dusit has invested about THB 10 million

for the new Dusit.com in order to continue upgrading to keep up with major changes that can

take place in the way of doing business. Thus it becomes very convenient for the guest as it

provides 24/7 connectivity to guests, for the travel industry to make their bookings, and

confirm their business or leisure trips instantly worldwide and even for the corporate

accounts as this website produce a new fresh look and design, easy navigation and many

more other features. Moreover, the new Dusit website will help the company to understand

their customer’s behaviour better with guest history, web statistics, conversion rates and

Google analytics features. Consequently, Dusit aim to increase the overall online bookings

through Dusit.com from 12 percent in 2010 to 25 percent this year 2013 as a minimum (New

face of Dusit.com, 2011.).

Analysis:

As stated in the Dusit’s mission statement that is to make Dusit one of the world’s

most valued hospitality brands across everyone, the company is tactically following its way

by expanding its business diversification. However, Dusit is able to meet broader customer’s

interests by operating different types of hotel businesses and thus customers will benefits as

they can choose where they would like to stay. Additionally, Dusit continuously renovates

116

itself through diversification and by adapting to the change of customers preferences. Dusit

recognize the importance of customer satisfaction. Thus, they try to deliver exceptional

services to customers that reach or exceed their expectation and hence they will become our

retained customers. People will value and recognize Dusit more than ever. This strategy is

one of the means to achieve its mission. Moreover, Dusit aims to deliver its unique concept of

Thai artistry and culture to everyone in the world. Nevertheless the company has to keep up

with the change with its external environment, but the uniqueness of Dusit still remains the

same. People want to escape from their normal routines and thus they seek a wide variety of

experiences from the hotel during their visit at Dusit. Therefore, these customers always

expected something more than just a place to stay. One of them is the spa business where

most customers want to experience as that would give them relaxing treatment. Besides spa

business, there are training businesses, education business that allow Dusit to provide

exceptional hospitality experience to everyone and are also the support to achieve the vision

as well. As a result, the company invested a lot in training courses so as to produce qualified

workforce who will be able to deliver outstanding services to their customers and once the

services provided reached up to customer satisfaction and meet up to their expectation then

the company can easily establish customer loyalty and hence profitable for the company.

117

References

AHA (2006). Asian Hotels Alliance merger forms world’s largest independent group.

Retrieved on 6th, February, 2013, from http://www.brandrepublic.com/news/ 642257/

Airline Frequent Flyer.(n.d.). Retrieved on 6th, February, 2013, from

http://www.dusit.com/en/loyalty/frequent-flyer-programs.html

A Luxury Hotel in Dubai. (2010.). Retrieved on 6th, February, 2013, from

http://www.dusit.com/dusit-thani/dusit-thani-dubai.html?utm_source=affilired

Asian Hotel Alliance (2004). Asian Hotel Alliance: Board Meeting in Bangkok. Retrieved on

6th, February, 2013, from http://www.odysseymediagroup.com/apn/Editorial-Hotels-

And-Resorts.asp?ReportID=91432

AsiaTravelTips.com (2004).Shangri-La Hotels and Resorts invests in MICROS-Fidelio’s

OPERA Central Reservations and Customer Information Systems.Retrieved on 6th,

February, 2013, from http://www.asiatraveltips.com/travelnews04/195Systems.shtml

Awards Winners. (2012). Retrieved on 7th, February, 2013, from

http://www.worldtravelawards.com/winners2012-4

Away Suansawan Chiang Mai completes Garden Room upgrades. (2013). Retrieved on 7th,

February, 2013, from http://www.pattayadailynews.com/en/2012/10/21/away-

suansawan-chiang-mai-completes-garden-room-upgrades/\

Boutique hotel (n.d). What is a Boutique hotel? Retrieved on 7th, February, 2013, from

http://www.wisegeek.com/what-is-a-boutique-hotel.htm

Boutique Hotel.(n.d.). Retrieved on 7th, February, 2013, from http://www.wisegeek.com/wh

at-is-a-boutique-hotel.htm

118

Brassfield, M. (2013).The Importance of Training for Hospitality. Retrieved on 7th,

February, 2013, from http://www.ehow.com/facts_6897368_importance-training-

hospitality.html

Business Mate.Org (2011). What is a Diversification Strategy? Retrieved on 8th, February,

2013, from http://www.businessmate.org/Article.php?ArtikelId=197

Centara Duangtawan Hotel Chiang Mai. (2013).Retrieved on 8th, February, 2013, from

http://www.centarahotelsresorts.com/cdc/meeting.asp

Centara KhumPhaya Resort and Spa wins the award. (2013). Retrieved on 8th, February,

2013, from http://www.eturbonews.com/29910/centara-khum-phaya-resort-and-spa-

wins-tourism-council-thailand-

Chen Sea Resort & Spa Phu Quoc.(n.d.). Retrieved on 8th, February, 2013, from

http://www.centarahotelsresorts.com/cpv/cpv_default.asp

Commercial hotel (n.d.). Retrieved on 8th, February, 2013, from http://www.webanswers.com

/searchresults.cfm?q=What%20is%20the%20definition%20of%20a%20commercial

%20hotel%3F

David, S. (2010). Marketing in the Hospitality Industry. Retrieved on 8th, February, 2013,

fromhttp://articles.submityourarticle.com/marketing-in-the-hospitality-industry-

104353

Diversification Strategy (2013). Retrieved on 8th, February, 2013, from http://www.enotes.co

m/diversification-strategy-reference/diversification-strategy

Diversification Strategy (2012).Related Diversification or Unrelated Diversification.

Retrieved on 8th, February, 2013, from

http://www.more-for-small-business.com/related-diversification.html

119

Diversification (2011).The Importance of Diversification. Retrieved on 8th, February, 2013,

fromhttp://www.investopedia.com/articles/02/111502.asp#axzz2KauOHVK0

Dusit.com (2010).Dusit Thani Maldives.Retrieved on 8th, February, 2013 from

http://www.dusit.com/dusit-thani/maldives.html

Dusit.com (2010).Airline Frequent Flyer. Retrieved on 8th, February, 2013, from

http://www.dusit.com/en/loyalty/frequent-flyer-programs.html

Dusit.com (2010).Loyalty. Retrieved on 8th, February, 2013, from

http://www.dusit.com/loyalty.html

Dusit.com (2010).Dusit Thani Dubai. Retrieved on 8th, February, 2013 from

http://www.dusit.com/dusit-thani/dusit-thani-dubai.html

Dusit D2 Baraquda Pattaya.(n.d.). Retrieved on 8th, February, 2013, from

http://www.dusit.com/dusit-d2/en/dusitd2-baraquda-pattaya.html

Dusit D2 Chiangmai (n.d.). Retrieved on 8th, February, 2013, from

http://www.dusit.com/dusit-d2/Basic requirements of hotel standard according to LVS

200-1:2009

Dusit International (n.d.).Dusit International invests in Human Capital. Retrieved on 8th,

February, 2013, from http://www.dusit.com/en/press-centre/83-dusit-international-

invests-in-human-capital.html

Dusit International.(n.d.). Dusit International makes Middle East Priority Market. Retrieved

on 8th, February, 2013, from http://www.dusit.com/en/press-centre/72-dusit-

international-makes-middle-east-priority-market.html.

120

Dusit International.(2013). Le Cordon Bleu Dusit School Culinary. Retrieved on 9th,

February, 2013, from http://www.dusit.com/le-cordon-bleu-dusit-culinary-school

Dusit International (n.d). Dusit International Dynamic Expansion into India. Retrieved on

9th, February, 2013, fromhttp://www.dusit.com/ar/press-centre/87-dusit-internationals-

dynamic-expansion-into-india.html

Dusit International (n.d). Dusit International Announces Hot Springs Resort in Hainan, China

Retrieved on 9th, February, 2013, from http://www.dusit.com/ar/press-centre/250-

dusit-international-announces-deluxe-hot-springs-resort-in-hainan-china.html

Dusit International (n.d.).Dusit’s International first step into Europe. Retrieved on 9th,

February, 2013, from http://www.dusit.com/ar/press-centre/92-dusit-internationals

first-step-into-europe.html

Dusit International (n.d.).Airline Frequent Flyer. Retrieved on 9th, February, 2013, from

http://www.dusit.com/en/loyalty/frequent-flyer-programs.html

Dusit International (2012). Dusit International gears up for expansion. Retrieved on 9th,

February, 2013, from http://www.hoteliermiddleeast.com/13950-dusit-international-

gears-up-for-expansion/

Dusit International (n.d.).Regional Sales Offices. Retrieved on 10th, February, 2013, from

http://www.dusit.com/en/contact-us/regional-sales-offices.html

DUSIT INTERNATIONAL APPOINTS CORPORATE DIRECTOR OF ROOMS. (2012).

Retrieved on 10th, February, 2013, from http://tourism-insider.com/en/2012/09/englis

h-dusit-international-appoints-corporate-director-of-rooms/

Dusit International proudly announce dynamic expansion project (2007). Art business touris

m news. Retrieved on 10th, February, 2013, from http://www.professorthailand.com/in

dex.php?mact=News,cntnt01,print,0&cntnt01articleid=197&cntnt01showtemplate=fa

lse&cntnt01returnid=259

121

Dusit Gold Card. (2013).Dusit International. Retrieved on 11th, February, 2013, from

http://www.dusit.com/en/loyalty/dusit-gold-card.html. Retrieved on February 15th

20013.

Dusit Thani (n.d.). Dusit Thani College. Retrieved on 11th, February, 2013, from

http://www.dusit.com/dusit-thani-college.html

Dusit Thani (2010). Dusit Thani Bangkok: Devarana Spa. Retrieved on 11th, February, 2013,

from http://www.dusit.com/dusit-thani/en/hotel-bangkok-facilities-a-services/Devaran

a-spa.html

Dusit Thani Bangkok (2010).A luxury hotel in Bangkok. Retrieved on 12th, February, 2013,

fromhttp://www.dusit.com/en/about-us/history.html

Dusit Thani College (2008) Dusit Thani Private College. Retrieved on 12th, February, 2013,

from http://studyinthailand.org/international_english_university_program/Dusit_Tha

ni_College.html

Dusit Thani hotel & resorts (2012). Dusit Thani Pattaya: Devarana named as Thailand’s best

luxury spa group at world luxury spa awards 2012. Retrieved on 12th, February, 2013,

fromhttp://www.dusit.com/dusit-thani/en/dusit-thani-pattaya-latest-news/1457-

devarana-named-as-thailands-best-luxury-spa-group-at-world-luxury-spa-awards-

2012.html

Dusit Thani Maldives (2012).Dusit Thani Maldives open’s February 2012. Retrieved on

12th, February, 2013, from http://www.dusit.com/dusit-thani/en/dusit-thani-maldives-

latest-news/1060-dusit-thani-maldives-opens-february-2012.html?

catid=128%3Alatest-news-2012

Dusit Thani Manila.(2013). Dusit Thani Manila Offers Free WI-FI and Wired Internet to all

its Guests. Retrieved on 13th, February, 2013, from

http://www.dusit.com/dusit-thani/en/dusit-thani-manila-latest-news/1056-dusit-thani-

manila-offers-free-wi-fi-and-wired-internet-to-all-its-guests.html

122

Dusit Partners IDeaS (n.d.).Dusit Partners IDeaS Revenue Solutions. Retrieved on 13th,

February, 2013, from http://www.asiatraveltips.com/news11/612-DusitHotels.shtml

Dusit six star. (2007). Dusit International proudly announces dynamic expansion projects.

Retrieved on 13th, February, 2013, from

http://ehotelier.com/hospitality-news/item.php?id=A11009_0_11_0_C

Elliott, Mark. (2013) Dusit forms alliance for China expansion. Retrieved on 13th, February,

2013, from http://www.traveldailymedia.com/145835/dusit-forms-alliance-for-china-

expansion

Firstclasstravel.de (n.d.) AL HUSN, 6 Star hotel of the Shangri-La Barr Al Jissah Resort &

Spa, Muscat.Retrieved on 13th, February, 2013, from http://www.firstclasstravel.de.

Destinations/oman-hotels-and-roundtrips/hotels-in-muscat/al-husn-of-shangri-la-barr-

al-jissah.htm

Fivestaralliance.com (2013).Shangri-La Barr Al Jissah Resort and Spa.Retrieved on 13th,

February, 2013, from http://www.fivestaralliance.com/luxury-hotels/751/Muscat

Four Seasons Residences.(2013). Private Residences. Retrieved on 14th, February, 2013,

from http://residences.fourseasons.com

Four Seasons Toronto (2012). Four Seasons Hotel Toronto To Offer Intelity's ICE. Retrieved

on 14th, February, 2013, from http://www.hotel-online.com/News/PR2012_3rd/Jul12

_IntelityFourSeasons.html

GHA.(n.d.). Retrieved on 14th, February, 2013, from http://www.gha.com/About-GHA

Hakala, D. (2008) Providing Employee Continuing Education. Retrieved on 15th, February,

2013, from http://www.hrworld.com/features/employee-continuing-education-

081808/

123

Haraketi,T. (2011). Effective Hotel Distribution Channels Management. Retrieved on 15th,

February, 2013, from http://ehotelier.com/hospitality- news/item.php?id

=21098_0_11_0 _m

Haridasani, A. (2011). Dusit launches Mobile Website. Retrieved on 15th, February, 2013,

fromhttp://www.businesstraveller.asia/asia-pacific/news/dusit-launches-mobile-

website

Hospitalitynet.org (2013) Dusit Hotels & Resorts Selects MICROS OPERA Enterprise Solution

as Corporate IT Standard.Retrieved on 15th, February, 2013, from

http://www.hospitalitynet.org/news/4018034.html

Hotelrepresentationaustralia.com (n.d.) HRA signs Dusit Thani Hotels & Resorts. Retrieved

on 15th, February, 2013, from http://www.hotelrepresentationaustralia.com.au/content

/view/664/6

Hotel Classification (2010). Basic requirements of hotel standard according to LVS 200-1:20

09. Retrieved on 15th, February, 2013, fromhttp://www.lvra.lv/en/certification/

/classification-criteria/hotel-classification.html

Hotelier Middle East. (2012) Dusit International gears up for expansion. Retrieved on 16th,

February, 2013, from http://www.hoteliermiddleeast.com/13950-dusit-international-

gears-up-for-expansion/

Hotel News (2013).Global hotel pulse: Asia/Pacific news. Retrieved on 16th, February, 2013,

fromhttp://www.hotelnewsnow.com/articles.aspx/9796/Global-hotel-pulse-Asia-

Pacific-news

Hotel rating Inflation.(n.d.). Retrieved on 16th, February, 2013, from http://newmediatravel.c

om/six/six-and-seven-star-hotel-rating-inflation/

Industrial Market. Retrieved on 16th, February, 2013, from http://www.wisegeek.com/what

-is-an-industrial-market.htm

124

Lookeastmagazine.com (2012).The Dusit Way. Retrieved on 16th, February, 2013, from

http://www.lookeastmagazine.com/2012/11/the-dusit-way/

Malhotra, S. (2007).The Bird Group makes its foray in the hospitality sector, enters into a

50:50 joint venture with Thailand’s premier hospitality group, Dusit Hotels and

Resorts. Retrieved on 17th, February, 2013, from http://www.bird.in/press_info2.asp

Market Development (2013) Growing sales of a current product in a new market. Retrieved

on 17th, February, 2013, from http://www.theproduct.com/ marketing/market_develo

pmentnt.html

Market Positioning (n.d.).Core Marketing Strategies. Retrieved on 18th, February, 2013,

fromhttp://www.coremarketingstrategies.com/marketing-fundamentals/26-marketing-

fundamentals/34-market-positioning

Micros.(n.d.). Retrieved on 18th, February, 2013, from http://www.hotel-online.com/Trends/

Micros/

MICROS Completes Global Deployment. (n.d.). Retrieved on 18th, February, 2013, from

http://www.hospitalitynet.org/news/4011864.html

Micros.com (2003) Dusit Hotels & Resorts Selects Micros Opera Enterprise Solution As

Corporate IT Standard. Retrieved on 18th, February, 2013, from

http://www.micros.com/NewsAndEvents/PressReleases/2003/dusit.htm

Minor International.(2011). Hotel Industry. Retrieved on 18th, February, 2013, from

http://capital.sec.or.th/webapp/corp_fin/datafile/dsf/0128132011-09-

30TA104L01006.PDF

Mobile Website (2011). How Hotels Benefit from Mobile Website. Retrieved on 18th,

February, 2013, from http://blog.vizergy.com/how-hotels-benefit-from-mobile-

websites/2011/05/12

125

Muuay, S. (n.d.).The Dusit Thani: the best of Thai hospitality. Retrieved on 19th, February,

2013, from http://www.scottmurray.com/Dusit%20Thani.htm

New face of Dusit.com (2011). New Face of Dusit.com: enhances Online Marketing Efforts.

Retrieved on 19th, February, 2013, from

http://www.dusit.com/en/press-centre/press2/173-new-face-of-dusitcom-enhances-

online-marketing-efforts.html?catid=26%3Apress-release-2011

New Releases. (2012). New Releases: Four Seasons Announces New Resort on Dubai’s

World-Renowned Jumeirah Beach Road. Retrieved on 19th, February, 2013, from

http://press.fourseasons.com/news-releases/four-seasons-announces-new-resort-on-

dubai-s-world-renowned-jumeirah-beach-road/

Nationmultimedia.com (2007). Dusit plans JVs to tap high end in Mid East. Retrieved on

19th, February, 2013, from http://nationmultimedia.com/2007/05/09/business/business

_30033718.php

Online Marketing (n.d.).Online marketing better than traditional marketing. Retrieved on

19th, February, 2013, from http://www.hotplanetmarketing.com/support.htm

Opening of Nova Hotel and Spa Pattaya. (2011). Retrieved on 19th, February, 2013, from

http://www.eturbonews.com/26281/centara-hotels-and-resorts-announces-opening-

nova-hotel-and-spa-

Opera Central System (2009). Create success- integrated efficiency for hotel chain. Retrieved

on 19th, February, 2013, from http://www.micros-fidelio.eu/en/Solutions/Products-N-

Z/~/media/Files/microsfidelio/Brochures/EU/

OPERA_Central_Systems_lowres_en.ashx

Opera Central Reservation system.(n.d.) Retrieved on 19th, February, 2013, from

http://www.docstoc.com/docs/122870984/OPERA-Central-Reservation-Systems

126

Pelican System’s E-Brochure (2010).The Paperless - Future Tools for Publication. Retrieved

On 20th, February, 2013, from http://www.pelicansystem.com/news/e-brochure-

hotel.html

Phan-Udom, N. (2013). Contents. Retrieved on 20th, February, 2013, from

http://www.dusit.com/file/financial/Annual-Report/Annual-Report-2013-English-

Thai/Annual_Report_Dusit_2013-Eng.pdf

Products and Services Supplies. (2005). Retrieved on 20th, February, 2013, from

capital.sec.or.th/webapp/.../20050007T06.DOC

Qantas Program Partners.(n.d.). Retrieved on 20th, February, 2013, from

http://www.qantas.com.au/fflyer/dyn/program/earningPoints/programPartners

Riley, J. (2010). Market segmentation. Retrieved on 21st, February, 2013, from

http://www.tutor2u.net/blog/index.php/business-studies/comments/qa-what-is-market-

segmentation

RingZero Network (n.d.). Ring Zero Networks (Thailand) Co,, Ltd. Retrieved on 21st,

February, 2013, from http://old.jobbkk.com/eng/job_express/extra_bkk.php?

Com_id=35147

Report performance (2012). Report of performance for the period ended September 30, 2012.

Retrieved on 21st, February, 2013, from http://www.dtc.listedcompany.com/newsroo

m/2012-11-14_DTC02_EN.pdf

Roongravi, S. Quality service of Dusit Thani Hotel. Retrieved on 21st, February, 2013, from

www.suic.org/wp-content/.../20Roongravi_Sivilai.pdf

Royal Princess Chiang Mai. (2013). Retrieved on 21st, February, 2013, from

http://www.dusit.com/dusit-princess/en/princess-chiang-mai-meetings-a-

conventions.html

127

Saha, A. Mapping of Porter value chain activities in to business functional units. Retrieved on

21st, February, 2013, from http://www.managementexchange.com/hack/mapping-

porter%E2%80%99s-value-chain-activities-business-functional-units

Sinclair, H. (2010). UAE tops Mideast hotel development pipeline. Retrieved on 21st,

February, 2013, from http://www.arabianbusiness.com/uae-tops-mideast-hotel-

development-pipeline-343701.html

Shangrila.com (2013) Shangri-La’s Villingili Resort & Spa Maldives. Retrieved on 21st,

February, 2013, from http://www.shangri-la.com/male/villingiliresort/about/

Shangrila.com (2013) Earn Points. Retrieved on 21st, February, 2013, from

http://www.shangri-la.com/corporate/golden-circle/earn-points/

Shangrila.com (2013) Growing With Us. Retrieved on 21st, February, 2013, from

http://www.shangri-la.com/corporate/careers/growing-with-us/talent-development-

programme/

Slutsku, A (n.d.). Different Classification of Hotels.(n.d.). Retrieved on 21st, February, 2013,

from http://www.ehow.com/about_5449819_different-classification-hotels.html

The Travel Association (2011). ABTA Publishes 2012 Travel Trends Report. Retrieved on

22nd, February, 2013, from http://www.abta.com/news-and-views/press-zone/abta-

publishes-2012-travel-trends-report

Travel Arabia (2011). Dusit unveils dynamic expansion plans. Retrieved on 22nd, February,

2013, from http://www.tradearabia.com/news/ttn_197764.html

Travel life (n.d.). Travel Life Sustainability in Tourism. Retrieved on 22nd, February, 2013,

fromhttp://www.travelife.eu/index.php?menu=about_travelife&lang=en

128

Yousef, D. (2012). Dubai’s first Four Seasons hotel to open by 2014. Retrieved on 23rd,

February, 2013, from http://gulfnews.com/business/tourism/dubai-s-first-four-seasons-

hotel-to-open-by-2014-1.1038378

129