STRATEGIC ANALYSIS OF TRAVELODGE, UK
Category : Analysis Examples, Hotel Industry in the United Kingdom, Hotel Marketing Strategies, Marketing Strategies, Strategic Process, SWOT Analysis Examples, UK Sample Papers
STRATEGIC ANALYSIS OF TRAVELODGE, UK
Travelodge UK is the second largest discount hotel chain in the United Kingdom. It has 380 branches located in the UK, in Ireland, and in Spain. It has approximately 20,000 rooms which makes it the third largest hotel chain. It is owned by Dubai International Capital and employs 5,500 staff. Travelodge employs winning organizational and marketing strategies that keeps it at the pinnacle of the hotel industry business in the United Kingdom. Last year, 6.5 M visitors stayed in their hotels. Their hotel website currently attracts an average of 2.2 M visitors each month. Eighty seven percent (87%) of the reservations are made online. During the royal wedding last March, Travelodge enjoyed a double digit growth. Most of its visitors are coming from Japan, India, Australia, Canada and the United States.
Travelodge sets itself apart from the other hotels in the UK with its innovative strategies. Low and very affordable price is the number one marketing strategy that the hotel chain prioritizes. In fact, Travelodge is the cheapest hotel chain that offers value for money. Customer convenience is also key to this hotel’s service. They have the “retail-style price checking program” that allows the browser to compare the hotel rate with the other rates of the competing hotels. They also make their customer special with their “pre-stay checklist”. This is the list of things that the hotel provides with the rate. The purpose of the “pre-stay checklist” is to let the customer understand that the hotel offers the lowest price but it does away with the unnecessary stuff that expensive hotel provides. What Travelodge provides are the practical and necessary things that a visitor needs like a sufficient amount of towel, pillows, and tea. Biscuits, toiletries, hairdryers and iron are not included in the service. Biscuits and toiletries can be secured for an extra charge and hairdryers and iron are offered without charge but on a first come first serve basis. The “no frill” strategy eliminates unnecessary cost. This is how the hotel cut on its operating cost so that it can offer a practical and more comfortable stay to customers with a very low price. Personalized directions are also provided for customers to locate the hotel branch of their choice. In addition to the online booking system, Travelodge offers a mobile booking service to customers who are pressed with time to log on to the internet.
The hotel also assures its customers that they are responsible for a comfortable and convenient booking and stay. Travelodge commits a healthy environment to all its lodgers with its 100% smoke-free policy. The customer privacy and security are prioritized when the customer transmits confidential and private information such as names and credit cards during online and mobile transactions. Unlike other hotels, Travelodge utilizes an innovative website technology that is user-friendly and accessible to all users using different browsers. Booking and cancellation transactions are well secured. Customers can also customize their stay by paying only for what they will use. They can pay for their choice of service such as the bar café, breakfast, wifi wireless internet, low-cost insurance and booking for tickets for shows and other tourist attractions.
SITUATIONAL ANALYSIS: SWOT
Of the four plus one marketing mix: price, product, place, people and promotion, Travelodge capitalizes on price. Its leadership in putting the price at a low level is its competitive edge. This is how the hotel chain attracts budget and practical travelers. For the well-heeled tourist, Travelodge’s service is a disadvantage. Its weakness lies in cutting the frills which the well-off tourist looks for in a comfortable hotel stay. But while the hotel chain does away with the Class A and B tourist, it has opened a flashflood of markets from the C and D category. Premier Hotel Inn is the biggest competitor of Travelodge, although its price is higher than £10 from Travelodge £19. Aside from the price, Premier Hotel makes it a point that its hotel has a pub or restaurant or is located close to them that offers alcohol. Considering that the UK has a culture of drinking alcohol, in this area, Premier Hotel Inn is at a competitive advantage. At the current Travelodge is still second to its closest competitor, Premier Hotel. The latter maintains 41% of the market share of budget hotels and Travelodge 31%. While Travelodge is gaining its lead with its aggressive price strategy and customer friendly and convenient website, we have a comment from customers finding Travelodge easier to navigate while Premier Hotel is criticized as over-relying on their unreliable website. (Bridge, 2011)
Travelodge is on its way to leading the budget hotel chain with its pricing strategy and website technology. With a majority of the travelers relying on online reservations, the world-wide-web can be tapped as a marketing strategy. Travelodge has very competent executives and has hired an IT expert with a background in blue chip companies to handle the IT systems of the Travelodge.
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Bridge, S., 2011. Battle of budget beds: Travelodge branded as 'childish' by angry rival Premier Inn. [online] Available at:< http://www.dailymail.co.uk/money/article-1351715/Battle-budget-beds-Travelodge-branded-childish-angry-rival-Premier-Inn.html> [Accessed 3 June 2011].
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Wikipedia, n.d. Premier Inn. [online] Available at:< http://en.wikipedia.org/wiki/Premier_Inn> [Accessed 3 June 2011].