Nassauer Hotel Case Study

Question One

Challenges for Nassauer Hotel

Nassauer Hof Hotel faces two main challenges. The first challenge is gaining competitive advantage in the market for room occupancy, which has made the hotel lose room occupation to larger hotels from 58 per cent in 2000 to 54 per cent. The challenge is becoming fiercer with the likely entry of Rocco Forte Hotel into the market, which is a five star European chain. The other problem is the hardships of this hotel to achieve the desired level of occupancy and also promote its image in foreign countries because it is still reliant on traditional distribution channels such as travel agents, toll-free central reservation numbers, and tour and travel operators.

Probable Action Plan

Nassauer Hotel should take the following actions to increase its market share and promote its image in foreign countries. In order to increase its market share, the hotel should analyze the market in terms of composition and size. The hotel should undertake this process through the marketing segmentation strategy. Segmentation is important since it enables an organization to identify high value customers and prioritize them by focusing on them for profitability (MacDonald, 2012). The focused priority will result to greater sense of loyalty and high retention rates from these customers since the focused attention results to better satisfaction. The other approach is to diversify the hotel’s operations and join an additional marketing consortium. Diversification involves engaging in different activities to reduce the risk of loss. The leasing of hotel rooms will reduce the reliance on hotel occupancy as the only source of income. A marketing consortium helps the involved organizations pull resources together to pursue a common goal (Paliwoda & Thomas, 2013). It will be advantageous for this hotel to join a marketing consortium since it will be able to enjoy far-reaching promotional campaigns, such as advertisement in foreign countries, hence leading to brand recognition, which will promote its image in a cost-effective way.

Question Two

Operational Advantage of Nassauer Hotel

Operational advantages refer to benefits that will accrue to an organization through the carrying out of its day to day activities (Ingram, 2007). The following are operational advantages that will apply to this hotel that large organizations cannot achieve. These advantages are easier customization of services and reduced labour costs. Small hotels are in a much better position to offer customized services to their clients since they are able to maintain a personal relationship with the local customers and, as result, will be able to accurately tell their tastes and preferences. For example, Nassauer Hotel was able to offer food of high quality and beverages, which enabled it to enjoy a strong local following.  The same hotel is also able to enjoy reduced labour costs because it serves a limited number of clients on a daily basis. The small number of customers can easily be sustained by a few numbers of permanent employees and temporal workers when there is higher demand.

Question Three

Predicted Opportunities for Nassauer in Lodging Industry

Nassauer Hotel can explore the opportunity of human resources and housekeeping management. Human resources and housekeeping are profitable opportunities in the lodging sector (Burns, 2010). The existence of golf courses, historic sites, museum and picturesque hike locations in Wiesbaden makes it a tourist center with a high potential of attracting many visitors (Gray, 2007). This hotel can explore this opportunity by identifying and recruiting highly specialized hospitality specialists for these hotels. In terms of housekeeping, this hotel can specialize in providing cleaning, hotel facility maintenance, and providing shopping supplies to the various hotels in the area.