A C A M P A I G N P R O P O S A L B Y V E R O N I C A S P A K

HILTON WORLDWIDES A FRESH START

CAMPAIGN

SITUATION ANALYSIS

Since the 1960s, no U.S. hotel brand had the ability to own or manage hotel properties in Cuba due to the governments heavy restrictions placed on Americans ability to travel to and from the country. As President Obama continues his efforts of thawing diplomatic relations and lift the trade embargo in Cuba, the travel and tourism industry has a large opportunity at its feet. Nearly 3 million tourists travel to Cuba annuallyCanadians and Europeans make up a large portion of Cubas tourist populationand once the current restrictions are lifted, an additional 3 million American travelers are expected to visit Cuba each year. Doubling the tourist numbers has the potential to heavily boost the Cuban economy. This is a prime opportunity for Hilton Worldwide because it will allow Hilton to reenter the Cuban tourism market and reestablish its historical presence in the country. American travelers will be drawn to stay at a Hilton owned or managed property due to the brands world renowned reputation and its massive number of loyal customers and HHonors members. Despite the fact that expanding the brand to Cuba would be a great feat for Hilton, the brand will encounter numerous obstacles throughout the planning and implementation processes. As of now, Cuba lacks the proper infrastructure and current technology that would create the solid foundation required for the development of American hotels. Cuban infrastructure does not nearly compare to that of the U.S. and appears as though time froze in the 1960s. Using a mid-20th-Century infrastructure as a platform to build a 21st-Century hotel will cause a myriad of problems in regards to physical construction, technology and communication. Fewer than 25% of Cubans have Internet access and those who do have access experience a slow process similar to that of the early 2000s. This poses a major problem for an American hotel brand because its typical clientele relies heavily on high-speed, dependable Internet access. It will be difficult to lure American travelers to an American hotel when it cannot provide standard amenities. Along with this, the Cuban government currently owns the majority of hotels in Cuba. Hilton will need to negotiate with Sol Melia and Cuban government to take over its original Cuban hotel, and rebrand it as the Hilton Habana Libre. 2

PROBLEM, OPPORTUNITIES AND CHALLENGES

Core Problem: Opening an American hotel in Cuba may be difficult because many

Americans are hesitant to travel there and the country lacks updated infrastructure and technology.

Opportunities: Stretches of undeveloped beaches could be purchased and

developed into brand new resort properties As a forbidden destination, many Americans are curious and eager

to travel to Cuba Immediate need to develop hotel rooms and products in Havana Travelers looking for first-class branded hotels and resorts Online hotel bookings continue to push tourism in Cuba Natural beauty and diversity of land

Challenges: Long processmore government and international legal work to be

done before Hilton can fully plan any development for a new hotel Legal challenges to hotel ownership Need for Cuban property law reform Lack of proper infrastructure to support American hotel brands Technology needs to be updated People look for 2-3-star hotels in order to achieve a historical and

authentic Cuban experience (think Hemingway in the 1920s). Currently there are only 12 travel categories that permit Americans

to travel to Cuba (pure leisure is not a category)

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INSIGHTS GATHERED FROM SECONDARY RESEARCH

Tourism: Corporate and leisure travelers are looking for first class branded hotels and

resorts Medical tourism is booming in Cuba due to state run medical system Canadians and Europeans make up bulk of visitors/vacationers 2.9 million tourists traveled to Cuba in 2013 The travel industry expects that 3 million Americans will visit Cuba annually Many travelers are looking to absorb Cubas rich history and have authentic

experiences (think Hemingway and other artists of the early 20th Century)

Cubas infrastructure: Current infrastructure may not be able to support high-end, modern hotels Technology in Cuba needs to advance in order to satisfy hotel guests need

for internet services and other modern hotel products Online bookings have pushed need for internet and technological

advancement further Cuban government owns majority of hotels Cuban government must reform property laws

Havana: Immediate need to develop rooms in Havanainflux of travelers requires

more rooms than what is currently available 60,500 rooms Colonial hotels, all-inclusive resorts, small inns and private guest houses

called casas particulares Proximity, location and access are major components of running a successful

hotel in Havana

Varadero: Varadero is the most developed and high-end part of Cuba 20,000+ rooms in Varadero Majority of hotels are all-inclusive 1 million foreign visitors in 2013 Canadians and Germans travel to the area the most

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SUGGESTIONS FOR PRIMARY RESEARCH

Conduct a competitive analysis of other major American hotel brands and their potential plans to possibly expand to Cuba. Include the following brands: Marriott Wyndham Sheraton

Conduct a competitive analysis of other major foreign hotel brands already in Cuba. We want to know what types of accommodations we will have to compete with or what travelers in Cuba expect. Include the following brands: Sol Melia Iberostar Royalton

Organize a series of focus groups to find out more information about public opinion on expanding the hotel brand to Cuba. Include the following publics: Investors HHonors members Americans that travel frequently to the Caribbean

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PUBLICS

Primary: Generation X and Generation Y travelers HHonors members

Secondary: Cuban hotel owners Hilton Worldwide Investors American travelers that have already visited Cuba

Intervening: Travel bloggers Travel reporters American news media Online booking sites (TripAdvisor, KAYAK,

Travelocity, etc.)

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GOALS AND OBJECTIVES

Goal: Reenter the Cuban hotel market as the top-choice

brand for American travelers.

Objectives: Outcome: Reduce American travelers hesitations about

visiting Cuba by 50% over the next year. Output: Encourage 20,000 American travelers to book a stay

at Hiltons Habana Libre property within first year of its opening.

Motivate HHonors members to attend HHonors Weekend 2017 and fill 75% of guest rooms.

Process: Inform investors about the hotel development

opportunities in Cuba within the next 2 months.

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MESSAGES

Single Over-riding Communication Objective: Cuba is the untapped, exciting travel destination for Americans. Competitively Unique: Hilton will provide

superior customer service and a unique experience to its hotel guests in Havana. Compelling: Hilton is starting fresh and

coming back to Cuba to make a splash in the Caribbean hotel scene. Credible: Chef Douglas Rodriguez will lend

his expertise to create the hotels restaurant menu and signature drink, and he will attend numerous events to promote the new hotel. Current: Due to diplomacy efforts between

the U.S. and Cuba, Americans have the opportunity to travel to Cuba and create memorable travel experiences.

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THEME: A FRESH START

Capitalize on the notion of starting fresh in a beautiful country that has much historical significance. Tie to the idea that the new Hilton Habana

Libre hotel will be revamped with a fresh feel that exceeds traveler expectations. Incorporate tagline/theme line into all

branded collateral, advertisements, and online content.

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SPOKESPERSON

Chef Douglas Rodriguez Rodriguez is known as the Godfather of Nuevo Latino

cuisine. Rodriguez is the son of Cuban immigrants. This renowned chef has a one restaurant in

Philadelphia (Alma de Cuba) and one in Miami (DRodriguez Cuba on Ocean)

He worked as a chef at the Fontainebleau Hilton Hotel in Miami Beach before opening up his own restaurants

Rodriguez is the author of several Latino Nuevo cookbooks

He can help promote A Fresh Start farmers markets and participate at the farmers market events. 10

BIG IDEAS

Host a HHonors Weekend at the new hotel to promote the opening and show members they are cared about. Create a welcome drink called La Fresca

that incorporates local Cuban produce (fresh fruits like mango, papaya or pineapple) and traditional Cuban rum. Host pop-up A Fresh Start farmers

markets in major cities to promote fresh Cuban produce and cuisine.

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STRATEGIES & TACTICS

Engage investors in an ongoing conversation about their interests in a Cuban hotel property. Hold bi-monthly meetings at Hilton Worldwide headquarters to allow

investors to discuss concerns, ideas and visions. Condense government-issued information into aesthetically

appealing one-page fliers to tone down travelers concerns. Hold a press conference for media to write stories that explain how

simple travel to Cuba will be. Post fun and colorful infographics on the microsite and social media

accounts to clarify traveling process. Invite top travel reporters to promotional events and the

Habana Libre site during and after construction to write stories about the events and opening. Set up A Fresh Start farmers markets in major U.S. cities to promote

the new hotel in Cuba. Host an HHonors Weekend at the hotel to show members they are

important to the brand. Plan a one-year anniversary celebration at the hotel in Fall 2017.

Highlight fresh and unique amenities on new media and social networks to catch Generations Xs and Generation Ys attention. Publish a microsite that will inform potential hotel guests about the

hotel plan. Position the new Hilton Habana Libre as a destination for

young American travelers. Create deals and promo codes to incentivize Generation Y travelers to

stay at Hilton Habana Libre. Create a welcome drink called La Fresca that incorporates local

Cuban produce and traditional Cuban rum.

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ACTIVITIES FOR A FRESH START FARMERS MARKETS

Pick outdoor locations with high foot traffic in the following cities: Chicago, Dallas, Denver, Los Angeles, Miami, New York, San Francisco, Tampa, and Washington, D.C.

Arrange for 7-10 local farmers to bring their products and attend the event.

Select 9 dates within two weeks of each other to host events.

Send out press releases to each locations local reporters.

Invite local reporters to stop by the farmers markets.

Set up 7-10 booths per location. Post photos of the farmers markets to

Instagram and Facebook accounts

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EVALUATION

In order to assess the campaigns success, we need to look at three important aspects: preparation, implementation and impact. We can begin by evaluating the success of the farmers markets in Fall 2016, the HHonors Weekend in Spring 2017 and the Spring Break promo codes in Summer 2017. We will be able to answer all of the following questions at the end of the campaign in Fall 2017. Preparation: How did we do? Did we stay within budget? Did all scheduled events follow timeline?

Implementation: How did it go? Did 20,000 American travelers book a stay at Habana

Libre after grand re-opening? Did farmers market attendees book guest rooms? Did we fill 75% of guest rooms at HHonors Weekend?

Impact: Change in outcome. Did we reduce American travelers hesitations about

visiting Cuba by 50%?

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TIMELINE

Fall 2015: Conduct focus group studies and competitive analyses Host press conference to announce the new hotel Debut microsite

Winter 2016: Post hotel plans to microsite Invite investors to groundbreaking ceremony Host groundbreaking ceremony Start renovations on existing hotel site

Spring 2016: Place stories about Rodriguez as the spokesperson in the media (newspapers, television,

online) Use social media to announce the farmers markets dates and locations Rodriguez posts video about farmers markets on his website and social media accounts Update microsite with newer photos, videos and information about renovation status

Summer 2016: Send out e-invitations to HHonors members to come to a farmers market near them Publicize grand opening date to public and allow customers to begin booking trips to the

hotel Host A Fresh Start farmers markets

Fall 2016: Rodriguez shares the news about La Fresca welcome drink Grand opening of hotel occurs 6 weeks after farmers markets close Gather feedback on hotels first month of business by interviewing guests Invite HHonors members to attend HHonors Weekend at hotel

Winter 2017: Host HHonors members at the hotel two months after invitations go out Push stories to media to recap HHonors Weekend Open up a promotion about Spring Break travel to Cuba

Spring 2017: Crunch numbers on media impressions from HHonors Weekend Close Spring Break promotion

Summer 2017: Compile data and information about program and present it to Hilton Worldwide executives

Fall 2017: Host one-year anniversary event onsite for HHonors members Evaluate program

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