Answer: Market segmentation in the context of Rocco Forte Hotels, it is nothing but the breaking and converting down the diverse group of tourist market into the relative homogeneous segment. The segmentation is carried out in different phases; one is that which is based on the trip description and the other based on tourist description visiting the hotel (The Environment).
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On the basis of trip description, the market segment is divided into business travel market and pleasure travel market, wherein market of pleasure travel is considered to be the largest segment which includes the visitors coming down for different purposes such as attending marriages/functions, treatment or educational trips for a short to longer period of time. The market segment has been proven to be sensitive to price fluctuations and highly influenced by economic fluctuations. The segment is further bifurcated into other segments of package tours and resort tours as well (The Environment).
The other segment singled out in this category is the business travel market that comprises the business users and business travelers to the hotel and whose visit is based on the purpose of attending meetings and conferences or any kind of business travelling (The Environment).
The market segmentation analysis of Rocco Forte Hotels is further outlined below –
Present Product
New Product
Present Market
Market Penetration: Hotels, Resorts, Restaurants, Spas, Weddings, Meetings and Events to Business as well as Leisure Travel Users of London, France, New York, Abu Dhabi Rome, Moscow etc (Rocco Forte Hotels).
Product Development: Dry Packages especially at the time of Ramadan and introducing Breakfast-In-Bed accentuating visitors (It’s never too early for a champagne breakfast, 2012).
New Market
Market Development: The group gave a nod in regard of the opening in Saudi Arabia, Morocco, Egypt, and Lebanon in the next couple of months this year (Rocco Forte Hotels expand in Middle East North Africa and invest 150 million euro in Sicily resort, 2012).
Diversification: Expansion in the new market to offer food packs in the airlines.
Question 2:
What segments does your business currently target?
Answer: The Rocco Forte currently operating in the hotel industry is primarily targeting business travel consumers as well as leisure travel consumers. The business travel users are the visitors who are visiting the hotel for the business purposes. They are basically the professional employees of any company who come to participate in business related activities. This includes a vast range of activities from meetings, conferences, educational trips etc. They often visit individually and even at times in groups. On looking at the frequency of their visit to the hotel, it was determined that their visit is generally daily, weekly or on monthly basis. In this segment, the hotel encounters local as well as international visits both generally for a longer duration of time. In addition, it was realized that these visitors are coming for the purpose of attending meetings and conferences, and also for the purpose of exhibitions, training courses, product launches and also to serve incentive travel.
On the other hand, the leisure segment includes visitors and guests from package tours, several independent travelers, visitors from the resorts segment, marriages and weddings.
Question 3:
Are there any other segments you think have value adding potential for your business? If so, do these options that you might wish to explore further?
Answer: Identification of new customer segments is vital for to achieve competitive edge within the entire hotel industry. In last couple of years, it was determined that there is a tremendous increase in the hotel demand with a spectacular growth in the diversification of consumers. Over the years, the Rocco Forte Hotel has experienced a continuous demand especially from the categories of government travelers, sports team, extended-stay patrons, and military personnel and among other different travelers making up the category of commercial and leisure segment.
On this move of the paradigm shift to target consumer segments, the Rocco Forte Hotel should delve further in understanding the needs and expectations of other segments outlined below –
Women
The Rocco Forte hotel chain has to be conscientious in portraying women in the UAE as a result. The advertisements and promotion as well as packages should target to this segment whilst showing how women are enjoying and relaxing as soon as they visit and check in to the hotel.
Airline Tie-Ups
The Rocco Forte hotel should enter into the airline tie ups in order to provide the distinguished members a luxurious stay across the globe. By availing and providing of the grand stay across different international properties, the hotel can run different membership and reward programs for the members eventually yield good results for the hotel.
Adventure and Eco – Tourism Segment:
By entering into this segment, the hotel would certainly be successful in attracting huge crowd belonging to the teenage segment and on the arrival of these guests, it is imperative for the concierge to make arrangements to meet up their needs.
Question 4:
Does any environmental analysis you have done so far suggest that customer needs are likely to change in the future? If so, does this have any implications for the ways in which the patterns of market segmentation change over time?
Answer: On conducting PESTEL analysis of the entire hotel industry in the UAE, it is determined that the elements of the analysis certainly have implications in the changing patterns of market segmentation as well as trends in food service and production.
With the increase in the vegetarianism within the UAE population which is seen as a major social factor, the Rocco Forte would concentrate on vegetarian market segment.
The imperative increase in the demand for exotic cuisine has shifted the move of the echelons of the hotel to the market segment and visitors from Japan, China and Thailand.
Owing to the increase in the economic concerns, the Rocco Forte multinational brand is now adopting the option of outsourcing and this will result in the opening of new outlets of bars and coffee houses across different locations.
Moreover, fluctuations in the prices and volatility will result in the decrease of visitors of leisure segment and thereby hotel will consecutively concentrate more towards business segment.
The increase in the carbon footprints due to greenhouse gas emissions during the production by the company will shift its focus from longer food miles to reduce the total mileage from plough to plate.
The growth in the legal transparency has resulted in rising awareness of consumers who wants to know about the hidden facts of food travelling from farm to fork.
And, obesity has been a major problem in today’s era and certainly UAE is facing obesity epidemic and thereby the move has been shifted to more add-ons and varieties and other healthier options on menus.
Question 5:
Are there differences in the resources and competencies required to perform well over different segments that your business targets, or might target in the future? Does what you have concluded about segmentation lead to any revisions to previous analysis?
Answer: While servicing established and target market segments, the brand or the organization is sure and aware about the needs and preferences of the consumers and users of the respective services. In the context of the Rocco Forte Hotel, at the time of servicing business segments and leisure segments, the echelons of the top management are putting in innovative efforts in the form of strategies and competencies those of which implemented and required at the time of entering new markets or new consumer segments (The Environment).
Studying new market and consumer segments will help the business to identify and implement competencies and opportunities that will affect the profitability. Several areas are ought to be identified and studies as a part of market analysis while entering new markets –
Description of instant area: This includes several throwing attention to elements such as commercial profile, proposed developments, uses of land, safety and availability of nearby services.
Proximity to Demand Generators: This includes several attractions to visitors and guests and tourists.
Volume of Traffic: This head covers the extent of volume of traffic is counting towards the profitability and what is the entire pattern of traffic of guests and visitors to the hotel.
Accessibility: This comprises of areas of major attractions to the hotel visitors, and especially includes streets and highways and malls along with the ease and facilitation of entry and exit (The Environment).
Question 6:
Do competitors focus on, or perform relatively better in, certain segments rather than others?
Answer: The international hotels giving a tough competition in the region of the UAE to the Rocco Forte Hotel and continuously paving their ways towards increasing their partnerships within as well as across the borders. On throwing light on the major competitors of the international hotel chain Rocco Forte, Hyatt Group of Hotels, Jumeirah Hotels and Resorts are giving tough competition in the segment where Rocco Forte has been suggested and proposed to enter. These brands have extended their international partnering and internal tie ups with the leading international airlines of the country. Qatar Airways and Emirates Airlines one of the exceptional brands in the airline industry in the country has substantially agreed into the mutual agreement of providing luxurious stay and other packages to the passengers travelling from the respective airlines (Partners at a glance).
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