Customer Satisfaction in the World of Competitors Based on Hospitality Industry
I. Market / Sector Overview
A. Market Definition
According to Lopes (2016), the hospitality industry is a broad industry that focuses on customer satisfaction in the form of leisure instead of basic needs (p. 10). Provision of non-basic needs requires excellent service to attract clients as it deals with needs people do not feel as necessary. It is mainly dependent on the amount of disposable income of the population and their spare time. More of disposable income and time means the industry will thrive (Lopes 2016, p. 12). The industry consists of the food and beverage, accommodations and travel and tourism categories.
The focus of this analysis is on food and beverage and the accommodation which narrows down to hotels and bars. Hotels are short-term lodging offering establishments equipped with facilities for childcare, swimming, business centers, conferencing and social functions. Bars, on the other hand, are an establishment that offers beverages, mostly alcoholic, and often with supplements such as small snacks and easy-to-cook cook foodstuffs. These two form the largest category of the hospitality industry as they act on symbiosis with the other classes of hospitality (Lopes 2016, p. 9).
B. Market Analysis: Market Share and Market Segmentation
The market of the hotels has remained unshaken even in the current economic state. Hotels categorization occurs in two clusters, namely the unrated and one to five-star ratings according to their services delivery. One and two stars ratings are for the standard hotels; three stars are for comfort, four stars for first class and finally, the five stars score is for the most luxurious ones (Purnell and Breede 2017, p. 213). The most massive market share is in the three stars hotels. There has been a reduction in travel rates, and it has promoted the tourism and travel. Moreover, the US market has sought a comfort-filled lifestyle thus resulting in the three stars market share. The income gained from hotels is at 199.3 billion us dollars (Purnell and Breede 2017, p. 213).
Bars have been experiencing competition from other forms of beverage selling establishments but have the most significant market share. Demographics of bars are not defined, and therefore it attracts people of all walks and ages. To get to attract different people, it has seen segmentation in its services (Köseoglu et al., 2016, p. 173). Most are small businesses, and the statistics prove that the top four player’s revenue does not even topple the 5% of the total income. The main types of bars found are the Irish pub, the granola bar, college bar, sports bar, nightclub, lounge, cigar bar and a dive bar.
II. PESTEL Analysis
The environment built around the hospitality industry is ever changing. Governments are changing, the climate and even the technology is fast changing, and these conditions has an effect on the hotels and bar industries.
The political climate of the US has changed with the coming of a new regime. There has been a reduction in travel rates, and this has increased the level of domestic travel, and therefore hotels and hospitality facilities have seen a boost in their business. The country has flagged off a one trillion infrastructure program that will encourage both local and international tourism and the use of hotels and bars.
Income in the country has stagnated especially for the middle class who are the most significant consumers when it comes to hotels and bars; this has become more significant considering that the hospitality establishments largely depends on peoples incomes. Therefore, they become substantially disadvantaged (Ivanov 2017, p. 112). The US dollar has grown in worth, resulting in its exchange rate with other foreign currencies relatively high and has discouraged many tourists from visiting the country. In the global financial crisis that took place in 2007/8, there was a 40% drop in the use of hospitality services (Lopes 2016, p. 21). Since then, the industry has never regained from the experience.
The US demographic distribution is now leaning towards the elder people. These are the best of travelers and end up using the hotels; this has changed the facilities that are available in hotels. The preferences of hotel suites have been twin bedroom for males and single rooms for females; this affects the structure of hotels (Ivanov 2017, p. 112). The youths have also been lured into bars using the new trends of nightclubs. The older systems of bars have fallen out of favor, and therefore bars are restructuring onto new forms to attract specific groups of the population.
Technology and connection are now on the next level. Hotels have therefore taken into embedding all customer and staff systems for proper service and security. Guests in bars and hotels now prefer availability of Wi-Fi and security options. Online services to access hotels for booking also come in handy. Most conferencing and business facilities will be better served with an accompaniment of a technological boost (Köseoglu et al., 2016, p. 177). These include projectors, screens and internet connection for teleconferencing.
A sound hotel in the American market will be better placed for business if it caters for environmental and sustainability issues. Sewerage and disposal services should be done appropriately so that even the appeal of the hotel can grow; durability comes in the form of water recycling, proper use of power and application of green energy especially solar in water heating (Jones et al., 2016, p. 37).
The USA is currently implementing an increased minimum wage bill. Bars and hotels mostly thrive on cheap labor. Now they have to deal with minimum wages of $15 per hour (Lopes 2016, p. 2). Ideally, this will be costly to the hospitality industry. Recently there has been an increase in a spurt of food poisoning resulting in the enforcement of the hospitality law being the center of attention (Köseoglu et al., 2016, p. 177).
Juniper Lee Hospitality Team; Midtown View Hotel Bar and Lounge
Juniper Lee Hospitality Team is an organization of service providers in the hospitality industry that exhume confidence in quality service and luxury. It is a group of professionals that work together in the hospitality setting. The team carries out an operation in Midtown View Hotel, Bar and Lounge. The hotel is located in 89 Midtown, Brooklyn, USA. It draws hoards of people from all walks of life including travelers and residents.
Juniper Lee restaurant serves food and cuisines. It also houses a bar and lounge on the rooftop with a beautiful view of the Brookline skyline. The facilities offered in the hotel include hotel service, a swimming pool, spa, conferencing and business facilities and children care (Janice, 2017).
IV. SWOT Analysis
Juniper Lee has been in the industry for ten years now, and it has helped in gathering information and experience in the field. The facility is endowed with 400 decent rooms which could cater for the increasing demand in the industry. Other, amenities such as a bar and lounge, swimming pool, child care and conference facilities are available for one’s preference and specifications. There is the use of technology and innovation in the online booking service, food ordering, making reservations and booking in-service for the ones already inside the hotel.
The high cost of rent in the city is deterring expansion of the hotel. The hotel has a seasonal dependency on holidays, tourists, and business trips. In the low seasons, there is fewer profits and heavy dependence on the bar and swimming facilities. With hotel services being cheap and many coming up, the market share keeps reducing.
The Juniper Lee Team has taken innovation to the next level. Since technology in the world is also fast changing, there is an opportunity to discover newer ways of marketing, service provision and security of our customers. Business markets are changing, and many organizations are educating employees and having retreats and vacations (Martinez, 2017, p. 45). The effort has given the facility a better chance of attracting more customers to the establishment.
Political and economic turbulence in the country has placed the hotel on its toes as the situation is not predictable. Long term decision making in the company has been crippled due to the constant changes in the political and economic front. The increase in minimum wage will increase the expenditure and reduce the hotel’s profit. Spending on tax is also on the rise with a tightening in the taxation system being implemented in the country (Martinez 2017, p. 65). The national aging population also affects the establishment’s ability to recruit new staff to supplement the facility’s aging labor force.
Summary and Conclusion
The hospitality industry in the US is fast growing, and this trend is projected not to change anytime soon. The environment around it is the most significant contributor to this growth. The political climate is intensifying in the country and is a determinant of the threats facing the industry. However, there is still growth in the number of tourists; both local and international that flock into the country, resulting in heightened opportunities to trade. Moreover, use of proper technology while at it preserving the environment should be the focus of today’s hospitality.
Ivanov, S. and Ivanova, M., 2016. Market penetration of hotel chains: Does culture matter?. Annals of Tourism Research, 57, pp.259-264.
Janice K., 2017. Top 10 Hotel Bars in Downtown Brooklyn , NY. [online] Available at https://www.expedia.com/Top-10-hotels-bars-in-Brooklyn-downtown/ [Accessed 1930 17/12/2012]
Jones, P., Jones, P., Hillier, D., Hillier, D., Comfort, D. and Comfort, D., 2016. Sustainability in the hospitality industry: some personal reflections on corporate challenges and research agendas. International Journal of Contemporary Hospitality Management, vol. 28, no. 1, pp.36-67.
Köseoglu, M.A., Ross, G. and Okumus, F., 2016. Competitive intelligence practices in hotels. International Journal of Hospitality Management, 53, pp.161-172.
Lopes, M., 2016. The hospitality industry (Doctoral dissertation).
Martinez, B., 2017. A SWOT Analysis on Millennials in the Workplace: Increasing Manager Success with Millennial Employees in the Hotel Industry (Doctoral dissertation, California State Polytechnic University, Pomona).
Purnell, D. and Breede, D.C., 2017. Traveling the Third Place: Conferences as Third Places. Space and Culture.