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Marketing Management in Hilton Hotel UK

Table of Contents

Introduction ............................................................................................................................... 1

1.Key issues in managing marketing operations in Hilton ......................................................... 1

2. Tools and techniques employed for developing and managing strategies, plans and

operations in Hilton ................................................................................................................... 3

3.Importance of control and evaluation of marketing management in Hilton ......................... 7

4. Key trends in marketing management in Hilton .................................................................... 9

Conclusion ................................................................................................................................ 10

References ............................................................................................................................... 10

Introduction

As per the definition of Hutt and Speh (2012) marketing management refers to the activities

that relates to the smooth flowing of products and service in to the markets and finally to

the customers. The activities of marketing management involves, choosing of target

markets, pricing of products, promotion, distribution etc. This report will cover the

marketing management operations and key trends of marketing management of Hilton

hotels and resorts, UK.

The marketing management of Hilton highlights the facilities of the firm clearly to customers

which includes transportation, communication and accommodation and as per the view of

Skift (2015) the marketing strategy of Hilton is clearly customer focussed. Since the

competitions in hospitality sector are high, the occurrences of key issues in business

operations are repeatedly reported as high. Therefore this report will highlight the key

issues involved in the marketing operation, and the methods and techniques employed to

make effective planning and strategies for effective operations of Hilton, UK. Apart from this

research will also discuss the role and contribution of marketing to the success of the

organisation.

1. Key issues in managing marketing operations in Hilton

Effective decision-making structure: Oseid (2014) states that, Hilton hotel is having a large

organizational structure and is mainly managed by a board of directors. Whenever a

decision is taken by the board of directors, it is conveyed to the general managers also. The

general managers are sole responsible to supervise the departments of the organization by

providing necessary orders and suggestions. The general managers are subjected to answer

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each and every problem identified with the inefficiency of operations in various

departments of Hilton hotel.

Leadership: According to the observations of Johnson (2012), Democratic leadership has

been followed by Hilton hotel in which the manager relies upon individual or a group of

employees to achieve the desired goals set by the organization. Nevertheless, the ultimate

authority to take and implement decision will be of the manager’s. The staffs and

employees of Hilton hotel, UK respects the higher authorities of the organization for

following a democratic style of leadership as this method encourages the involvement of

the staffs to deliver ideas whenever any operations or plans or strategies are about to

implement in the organization. Moreover, by the practice of democratic leadership Hilton

hotel strives to restrict the degree of insufficient and defective decisions.

Trained and disciplined staff: Kanani (2014) opines that the staffs of Hilton hotel are well

trained and they efficiently work to satisfy the desired objectives and goals of the higher

managing authorities and to successfully establish the strategies planned by the board of

directors. In order to check the attitude and approach of the staffs of the Hilton hotel

frequent supervisions are done. Well trained and disciplined staffs are the assets of Hilton

hotel.

External factors:

Political:

While analyzing the political factors with respect to the organizational strategy of Hilton

hotel, it has been found that at times many bookings were cancelled due to visa refusals of

the travellers (The Telegraph, 2013).

Economical:

On the other hand the economic recession has resulted in the decline of overseas tourism

which negatively impacted the economy of Hilton hotel. Besides, the problem aroused by

economic recession, the booming of less-expensive hotels was a risk factor for the Hilton

hotels. It was reported by Kanani (2014) that the first public offering of Hilton hotel would

rise up to $2.37 Billion in the biggest –ever hotel IPO.

Social:

Being a well established brand, Hilton hotels attract a large population of customers and

efficiently coordinate with many other charity trusts and organizations (Dudovskiy, 2013).

Technological:

In the view of Hamstra (2014), the use of technology, especially internet plays a major role

in helping the customers of Hilton hotels to book rooms and to provide reviews and

information on customer experience and service quality of the organization. The social

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media sites such as Facebook, TripAdvisor, Twitter etc. are consulted by the customers to

share their experiences with Hilton hotels. Such a facility enhances the popularity of the

brand name of Hilton hotels.

Legal:

According to Oseid (2014) the changing rules and regulation with respect to the hospitality

sector in UK directed Hilton to make instant changes in market situations according with it.

Apart from this rules with respect to immigration in UK and consumer protection rules etc

legally impacted the business operations of Hilton, UK.

Environmental

In the view of Johnson (2012) unexpected changes in the weather conditions and

occurrences of natural disasters, results to the reduction of flow of customers, due to

cancellation of bookings and lack of accessibility to the resorts. Seasonal changes in catering

of business and damages occurring to the brand image of firm due to environmental

pollutions are other environmental impacts to the Hilton.

2. Tools and techniques employed for developing and managing strategies, plans and

operations in Hilton

STP (Segmentation, Targeting and Positioning)

As per the view of Moritt and Weinstein (2012) the marketing activities of firm depends

mainly on three criteria, Segmentation, Targeting and Positioning.

Figure 1: STP (Segmentation, Targeting and Positioning)

Source: Zimmerman and Blythe (2013)

Segmentation

Weinstein and Cahill (2014) mention segmentation as the process of segregating the

markets on the basis of customer characteristics. McCabe (2010) reports that the main

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targets of Hilton Hotels and resorts as the individuals who pursue luxury life style and

societal status in the public. Therefore in accordance with the characteristics of customers,

premium charges were apportioned by the company on its products and services offered to

customers along with pertinent premium quality. The firm has been focusing on niche

marketing to spread the recognition of business specially focusing on business travellers as

well as leisure’s (Moritt and Weinstein, 2012).

Targeting

Hilton hotels continue to get expanded in South and Central America (China Business

Review, 2012). The target markets of Hilton hotels include Columbia, Argentina, Peru,

Panama, Costa Rica, and Chile (Hilton World Wide, 2010). The target group of Hilton

includes honeymooners, leisure travellers and families.

Positioning

Dibb and Simkin (2013) states positioning as the process of positioning of brand image of

the product in the minds of customers. As per the US brand tracking (2011) the brand

ranking of Hilton hotels in Europe accounted 91% and the firm has been recognized as

number one in Australia, Asia, Japan, Europe and Middle East. Hilton hotels offer luxurious

accommodations for customers with upscale facilities which had strengthened the brand

recognition of the firm.

Ansoff matrix

Figure 2: Ansoff Matrix

Source: McCabe (2010)

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Product development

As per the view of Skift (2015) in the stage of product development firm tends to enhance

market share by selling new products and services in existing markets. The current product

standards of Hilton ranges from well equipped guest rooms, well maintained landscape

grounds, Spa services, stunning bar, beverage service, fitness centre, separate pools for kids

and adults etc (CNBC, 2015). In order to increase market share, further complimentary

facilities like unlimited Wi-Fi, free booking services, convenient checkout facilities, etc can

be added.

Market Development and Diversification

Hilton can exploit the opportunities of global expansion by identifying the potential area,

where in which the flows of customers are more. Furthermore the company muse on

expanding the branches nearly to the sites of international airports for facilitating the easy

access of customers. Hilton concentrates more on opening of stunning conference hall for

business meetings, events and social gatherings (Dibb and Simkin (2013).

Market penetration

Through offering stunning and astonishing facilities to customers the Hilton keeps a pint of

differences from competitors. The firm has been using online marketing promotions for

grabbing customers and also maintains relationship marketing as the key strategy for

reaching target customers from various regions (Skift, 2015).

Marketing mix

Marketing mix is a tool usually used by marketers to manage controllable aspects of a

product's marketing plan. Initially marketing mix included 4 elements; product, price, place

and promotion (Kotler, 2012). This was referred to as 4P’s marketing mix. Later 3 more

elements i.e. process, people and physical evidence were added to the marketing mix,

reports Bowie and Buttle (2013). In below section, the 7P’s marketing mix of Hilton hotel is

assessed.

Product: Hilton Hotels & Resorts offers services through hotels, resorts, apartments etc.

They also provide complimentary services along with main services such as restaurants,

bars, spa, laundry services, travel desk, smaller shops, spa, travel desk, business centre,

laundry services, banquet halls etc. 24/7 room service, free access to newspapers and

magazines, concierge services etc. are also given as services (Hotel Industry Magazine,

2014).

Price: Hilton utilises a pricing framework which incorporates four pricing strategies:

economy, penetration, skimming and premium pricing strategies.

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Figure 3: Pricing strategy of Hilton

Source: Yang, Zhang and Mattila (2015)

Economy: Selling products with basic features and amenities at low price.

Penetration: Selling high quality service at comparatively low prices than competition.

Skimming: Offering comparatively higher quality services at higher prices than competition.

Premium: Providing highest quality services and at premium prices (Yang, Zhang and

Mattila, 2015).

Place: Distribution network of Hilton provides convenient access to book services through

internet and mobile. The hotel also provides assistance to customers in room booking,

events and weddings, meetings and airport pick-ups (Wong and Wickham, 2015).

Promotion: Promotion strategy of Hilton involves advertisements, personal selling, public

relations and sales promotions.

Advertisements: For promoting global presence and high quality service of Hilton through

advertisement campaigns such as ‘Stay Hilton, Go Everywhere’.

Personal selling: Involves approaching potential customers through various channels to

develop long term relationship with customers.

Public relations: Involves online and offline press releases for communicating with

stakeholders.

Sales promotions: Provides offers and discount vouchers through HHonors rewards program

(Yang, Zhang and Mattila, 2015).

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Process: Maintains high quality and luxury approach in all processes. Also provides provided

around the year and around the clock services in hotels (Wong and Wickham, 2015).

People: Customers, employees, suppliers etc, form the important people related to Hilton.

Customers are rewarded for their loyalty through HHonors while employees and suppliers

are given bonuses and incentives based on their performance (Wong and Wickham, 2015).

Physical evidence: Physical evidence refers to tangibility of products and services of Hilton.

Hilton maintains high quality in hotels and other services through luxurious interior and

exterior design, usage high end products and systems etc (Wong and Wickham, 2015).

3. Importance of control and evaluation of marketing management in Hilton

Marketing management deals with management of marketing activities of a firm. This

involves implementation, control and evaluation of marketing activities, observes

Westwood (2013). These three activities form the core part marketing management in

Hilton.

Marketing controls: The process of monitoring and manoeuvring of marketing plans

developed by the organization with respect organizational objectives (Westwood, 2013).

The methods used in marketing control evaluates if a specific marketing activity is on the

right path to achieve the predefine objective.

Marketing evaluation: The process of evaluation of marketing activities after their

completion to assess their success in achieving marketing and organizational objectives

(Westwood, 2013). .

So, marketing control activities allow Hilton to closely manage its marketing operations and

thus ensure that they attain success. On the other hand, marketing evaluation involves

assessing marketing activities with respect to marketing objectives of the hotel to identify

how successful were they in achieving them. This reveals that without control and

evaluation marketing management would falter in Hilton.

Mechanisms for control and evaluation

The control mechanisms used by Hilton for controlling marketing involves three steps.

Developing standards: In this step, Hilton develops standard outcomes for marketing

activities based on expected outcomes of the marketing activities. For example, when Hilton

introduced Digital check-in service they implemented a marketing plan to promote this

service. In order to control this plan Hilton developed a standard against which the actual

performance of the plan is reviewed. The standard used in this case was the expected

number of customers using digital check-in (Yang, Zhang and Mattila, 2015).

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Measuring performance against standards: In this step Hilton measures the actual

performance of the activity with respect to the standard set in previous step. In the case of

Hilton Digital check-in, the actual performance was higher than standard as more customers

than expected utilised the service (Yang, Zhang and Mattila, 2015).

Correcting deviations: In this step, Hilton takes corrective measures to bring the marketing

plan on track if the performance measurement was low. On the other hand, if performance

was high then Hilton improves the further implementation of the marketing plan. For

example, Hilton was able to identify that its promotional campaign was providing confusing

messages to customers as some of their properties were not participating in the campaign.

Due to there were wide spread complaints regarding not receiving offers from customers.

So this allowed Hilton to retract the campaign (Yang, Zhang and Mattila, 2015).

The important marketing evaluation methods used by Hilton are:

4. Market share analysis: Market share analysis provides a comparison of market share

of an organization with respect to that of its competitors. Hilton has a market share

of 8.8% in UK market. This considered low since Hilton has higher brand value than

most of its competitors. However, it also needs to be noted that Hilton has increased

its market share by 2% since 2009 through effective marketing (Hotel Industry

Magazine, 2014).

5. Sales analysis: sales analysis deals with analysis of sales figures of an organization in

a specific period. Sales analysis is used in marketing evaluation by assessing the

changes in sales in the time period when a marketing plan was implemented. For

example, Hilton’s sales revenue increased from £445 million to £447 million in 2013

this shows that marketing activities of the company during this one year period was

very effective (Hotel Industry Magazine, 2014).

6. Return on investment (ROI): Return on investment (ROI) of marketing relates to the

revenue generated by a company from investment in marketing. Hilton was able to

improve its marketing ROI by 12% by associating with Google HotelAds (Think with

Google, 2015).

7. Marketing audit: Marketing audit is a comprehensive examination of a company’s

marketing environment, activities and strategies in specific time period. Hilton has

increased market share in UK over the last few years, reports Hotel Industry

Magazine (2014). The company has also increased its room share and has also

further invested in development new properties across UK. Hilton’s usage of internet

and mobile marketing to promote sales and offers was widely received among UK

customers. (Yang, Zhang and Mattila, 2015). So this shows that marketing

environment, activities and strategies of Hilton are strong in UK.

Based on the review of control and evaluation of marketing management tools used in

Hilton it can be summarized that these tools allow marketers to manage the marketing

programs effectively.

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4. Key trends in marketing management in Hilton

For analyzing the key trends in marketing management of Hilton hotel, social media

marketing, mobile marketing and CRM (Customer Relationship Management) are discussed

in this section.

Social Media Marketing

Siemasko (2012) states that, social media marketing techniques are mainly used by the

companies for promoting their goods and services, to create community and to establish

visibility. With the help of careful, custom and deliberate social media marketing

techniques, Hilton Hotels and Resorts are able to maintain an effective social relation with

customers and with the help of this marketing strategy, the company is able to provide good

services for the customers, Siemasko (2013). Hilton Hotel has created a twitter account for

proving a forum for communication and for providing support for the customers. In addition

to Twitter account, Hilton Hotels and Resorts also engaged in Google+, YouTube, Facebook,

Foursquare, etc.

Through social media marketing the company is mainly aims to generate loyalty among

customers. Siemasko (2012) reported that, in 2012, number of followers for the company in

Facebook has increased to 185% and engagement of customers in Twitter and Facebook

account of brand also increases. Hilton hotel is actively monitor the page of the brand in

every day and also resolves the problems and negative issues faced by customers within 6 to

12 hours. However, Wharton (2012) reported some issues of customers such as lack of

providing remedies for the problems through social media, posting of comments by

customers about their bad experience, etc. Siemasko (2013) opined that, from the social

networking tactics of Hilton Hotel, the customers of the industry are highly satisfied with the

services and they are highly loyal towards the firm.

So, it can be inferred that, with the help of social media marketing, the company is able to

create loyalty among customers and it helped to enhance the brand image of Hilton hotels.

Mobile marketing

For accessing the internet features of hotel chains, a new web application was launched by

Hilton hotel. With the help of these innovative mobile services, customers can make

advance booking and watching the information and image of Hotel, reports Harnick, (2009).

Selection of rooms from the vacant rooms of hotel through mobiles provides a new

experience for the customers and it helps to save the time of customers. Samuely (2015)

states that, Digital check-in with room selection is first adopted by Hilton hotel and resorts.

With the help of mobile- centered hospitality, the company is able to achieve success in the

hotel industry. Harnick (2009) opined that, the innovative technology for unlocking the

doors of rooms by holding mobile phone in front of the sensor also generates a good impact

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on customers. These innovative techniques help to improve the brand image and consumers

perception about the brand.

Customer Relationship Management (CRM)

According to Saraceno (2011), the customer relationship management of Hilton hotel is

known as OnQ and which is officially known as customers really matter. The company

makes clearer idea among employees that, customers are the major assets of the firm and

the company provided fast check-in process, considering the preference of the customers,

etc for attracting and retaining them. With the help of OnQ, the Hilton hotel is able to

achieve total technical solution for the issues and it also delivers competitive advantages for

the company, Chain (2013). In addition to this, OnQ plays an important role in implementing

leading edge technology with low expenses. Hilton hotel provides recognition,

personalization, service recovery and customer analytics for supporting customers and for

providing better services. This helps to create a good perception among customers and it

increases loyalty of customers about the firm Saraceno (2011).

However, Chain (2013) reported that, implementation of OnQ technology at the front desk

staffs will create challenge for the company. It also creates difficulties for brand

differentiation and this CRM strategy of Hilton hotel will create difficulty for measuring the

priority area.

Conclusion

The importance of marketing management in Hilton Hotels, UK was assessed in this report.

In the first section, the key issues related to marketing management in Hilton were

reviewed. Leadership, decision making structure, employee training etc. were identified as

the main issues related to marketing management in Hilton. The different marketing tools

and techniques used by Hilton such as STP, Ansoff matrix and 7P’s product mix were

reviewed in the report. The report also provides an assessment of tools and techniques used

for control and evaluation of marketing management. It was also understood that marketing

share analysis, sales analysis, marketing audit etc were used for evaluating marketing

management in Hilton were necessary to attain marketing objectives. Lastly the key trends

in marketing management were also reviewed in the report. It was identified that social

media marketing, mobile marketing and CRM were some of the key trends in marketing

management in Hilton.

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