Marriott International Inc.
2a. Company selection
Marriott International Incorporated is a multinational firm that diversifies on hospitality and manages an extensive portfolio of lodgings, hotels, and other dwelling facilities. The company was established in 1923 by John Marriott and has grown to become among the top largest hotel chains globally. According to Marriott’s 2018 annual report, the company has approximately 7,000 properties across 130 locations and territories in the world. The hospitality chain has its headquarters in Maryland, Washington DC, and operates over 30 brands on a global scale. The primary offerings of Marriott International Inc. include over 1.3 million hotel rooms, which provides for 560,000 managed, 756000 franchised, and 17,000 leased.
The fiscal year 2018 was pivotal in delivering exceptional results to the business. According to the 2018 Annual Report, Marriot generated total revenue of approximately $20.75 billion, with $2.3billion and $1.90 billion as the operating income and net income, respectively (). Notably, the company has over $23 billion in total assets and $2 billion in total equity. Marriott employs over 176,000 total employees in its three subsidiaries, including Starwood Hotels & Resorts, the Ritz-Carlton, and Le Meridien. The significant sources of revenue include property management fees, franchise fees, and money from lease operations. Diagram 1 shows the financial performance of Marriott Inc. in 2018, including $5.45 earnings per share.
Diagram 1: Marriott International Inc. revenues 2018
Marriot Inc. operates, franchises, and licenses properties across all territories in the world. About 30 percent of the total revenue emanates from the North American full-service segment, while 35 percent comes from the North American limited-service concept. Notably, the Asian-pacific region represents about 15 percent of the total earnings, while 20 percent of the revenue emerges from other locations across the globe, as shown in diagram 2.. Don't use plagiarised sources.Get your custom essay just from $11/page
Diagram 2: Marriott International Inc. property distribution
Marriott International Inc. has achieved monumental success in the hospitality industry on the global stage by establishing a simple mission statement. The business seeks to enhance the lives of its customers through the creation of a leisure experience and unsurpassed vacation. Marriot invests and takes great pride in its employees to ensure the reflection of the company’s core values to external stakeholders. According to the 2018 annual report, Marriot International Inc. is a worldwide operator, licensor, and franchisor of hospitality properties. The lodging company has a rich portfolio representing over thirty large and compelling brands across the globe. Marriot groups its portfolio into three quality tiers, including luxury, premium, and select levels.
Luxury Marriott brands offer superb and bespoke services. They include St. Regis, Ritz Carlton, and JW Marriott. The premium portfolio brands provide complex, sophisticated, and thoughtful amenities to the clients. These include Marriott Hotels, Marriott Vacation Club, Marriott Executive Apartments, Delta Hotels, and Sheraton. The select brand portfolio offers smart and easy services by providing customers with a vacation experience worth his or her money. They include Residence Inn, Courtyard, Towneplace Suites, Four Points, and Protea Hotels.
The key competitor to Marriott International Inc. is Hilton Hotels and Resorts. The multinational hospitality company offers a similar portfolio and diversification as Marriott. Hilton brand is among the oldest in the industry and was established in 1919. Notably, the company has its headquarters in Virginia, US, and operates across approximately 113 territories across the world. The table below summarizes the competitiveness of Marriott’s principal competitor, Hilton Hotels, and resorts.
| Marriott International Inc. | Hilton Hotels and Resorts | |
| Establishment | 1927 | 1919 |
| Headquarters | Maryland, US | Virginia, US |
| Areas served | Worldwide | Worldwide |
| Product portfolio | Hotels and Resorts | Hotels and Resorts |
| Operating locations | 6,900 | 5,700 |
| Employees | 176000 | 169000 |
| Operating Income 2018 | $2.36 billion | $1.43 billion |
| Brand portfolio | Owned, Licensed, and Franchised properties | Owned, Licensed, and Franchised properties |
| Brands | Luxury, Premium, and Select | Luxury, Upscale, and Midscale |
The table above shows how Marriott and Hilton offers the same product portfolio in the hospitality industry. The two companies were established in the early twentieth century in the US and have developed a global footprint across world territories. Moreover, the multinationals offer similar products, which have led to greater brand recognition, especially to business travelers. Both companies provide guest loyalty programs with essential features such as redeeming free flights, priority check-in, no blackout dates, and free nights. Notably, Hilton’s loyalty program allows clients to shop and donate to their favorite charity programs.
Marriott International Inc. undertakes several promotional activities such as advertising, branding, and marketing on both national and international levels. The business believes that hospitality industries need to focus on websites and social media strategies to achieve success. The company uses the twitter platform to solve client concerns as well as sharing new data about their services through other social sites. Marriott has also established a customer portal on its website that collaborates with Excella and Pica9 consulting. These digital companies ensure the customization of marketing materials and products to the clients in a cost-effective approach. The following is a sample of Marriott’s advertisement through the Twitter platform.
The hospitality sector is among the most diversified industries in the economy, employing millions of employees and accounting for billions of dollars in revenue yearly. The broadness of the sector is characterized by products like lodgings, hotels, theme parks, event planning, and theme parks. Marriott’s customer includes individuals who have desirable disposable incomes and leisure times. The company is heavily reliant on customer satisfaction and offering the best experiences. Some of the competitive products in the industry include smart in-room technologies, customer service bots, location-based tech, and self-service technologies.
2b. Market opportunity
Marriott’s competitiveness in the hospitality industry is enhanced by the company’s focus on the needs of business travelers. This category includes individuals who attend conferences, important meetings, and research talks. Business travelers usually need a place and location to stay for a short while. However, this customer segment desires high-quality lodging services, amenities, and satisfaction. According to Lock, travel, and tourism is a vast industry that contributed more than $10 trillion in the world economy in 2017 (2018). Moreover, the business travel provided about $1.23 trillion during the same year. With many travel managers expecting a significant increase in the industry, the segment can have a considerable impact on Marriott’s growth plans.
Catering to today’s business traveler with the right products can provide Marriott with a stable revenue stream. This customer segment seeks services rooted in efficiency and maximum satisfaction. However, the guests have unique needs and are increasingly diverse in career, age, gender, and nationality. I have observed that advancements in technology have presented an automated and mobile future. In this regard, Marriott needs to invest in mobile applications and artificial intelligence technology to curate offerings to the business traveler segment. These features would provide a critical opportunity to collect guest data, which would allow improved efficiency.
2c. SWOT analysis
| Strengths · Adherence to operational norms · Global presence: The hotel chain operates within 7,000 locations across 130 territories in the world. · Over 1.3 million rooms in its properties · The company’s operational philosophy centers on innovation | Weaknesses · Excessive focus on expansion · Emphasizes on offering standard services which lowers employee morale · Negative controversies such as blockage of customer’s Wi-Fi stating privacy risks · Business deeply rooted in Marriott family values and unwilling to change |
| Opportunities · Increase in global travel especially tourists and business professionals · Focus on unique experiences since today’s customers are willing to pay more for personalized attention · Using social media to promote the products and interact with customers | Threats · Increased competition from reputable brands such as Hilton Hotels and resorts · Luxuries properties and hotels are vulnerable to terrorist attacks. · New technologies have disrupted the industry’s profitability. |
Marriott’s strategic growth options include the following
- Establish footprint to Asia-Pacific since traveling and tourism in the region is predicted to continue expanding
- Establish collaborations with electronic payment businesses such as Skrill, PayPal, and Google payments.
- Develop partnerships with Airbnb to drive Marriott quality services to travelers seeking curated home-stay experiences
- Invest heavily in the loyalty program, Bonvoy, to ensure the retention of business travelers, tourists, and guests
2d. Statement of Opportunity
In light of the continued expansion of the global travel and tourism sector, Marriott’s International Inc. will invest in ePayment partnerships with MasterCard.
Marriot seeks to integrate digital payments strategy to provide choices for the customers in paying for the services. The partnership with MasterCard will present innovative solutions through contactless technologies. This method will make transactions faster, thus improving the customer experiences within the hotels. Marriott will hope to integrate the partnership with its loyalty program, Bonvoy, to offer the customers a wide range of discounts. The approach will stabilize the revenue streams, which is a critical factor of growth and sustainability in the hospitality industry.
Works Cited
Lock, Stephanie. “Topic: Global Business Travel Industry.” Www.statista.com, 9 Nov. 2018, www.statista.com/topics/2439/global-business-travel-industry/.