Case Study Rosewood Hotel and Resort

Rosewood Hotel & Resort 1. Problem Definition/Decision facing the Company: ● Problem: - Seeking to build a global recognition with iconic luxury hotels. Re-brand to increase customer profitability and lifetime value. - Consumers do not know the Rosewood as a brand, only by the individual locations. -Corporate branding or individual branding ● Decisions: - How far they can push this re-branding strategy without undercutting the distinctiveness of each individually branded hotel -Can the benefits of outright full branding outweigh the risks -Imposing the Rosewood brand may alienate some of our guests at well established properties -How to develop consistent brand-wide performance standards while preserving the uniqueness and individuality of Rosewood 2. Core Value/ Positioning Strategy: - “Sense of Place” which at its core, means that much of our properties seeks to capture what is unique about the given location. From design to service to programming, we try and tailor each property experience to what is special about a given location, architecture, history, and culture. - “Collection” strategy of unique properties, each with its own name or brand. Each hotel and resort features architectural details, interiors, and culinary concepts that reflected local character and culture. The individual property/collection strategy was a powerful tool to differentiate Rosewood properties from competitors with a corporate brand. - Uniqueness / Luxury / Adaptability 3. Target Market: - Hotel Professionals - “Rosewood Junkies” those who will seek out Rosewood properties exclusively, seeking to emulate AmanResorts model, core followers who pride themselves on collecting Aman experiences and generally rejected the other luxury corporate brands - Customers with travel agents - Sophisticated customers that value luxury 4. Competition: - Rosewood competed with two groups of luxury hotels: First, the corporate branded Ritz- Carlton, Four Seasons, ST. Regis, One&Only, Fairmont, Park Hyatt, Regent, Peninsula, Raffles and Mandarin Oriental hotels. Second, the “collections” of individually branded unique hotels, such as Auberge, RockResorts, Rocco Forte, Dorchester, and Orient-Express 5. 4 P's: - Product: World class individual luxury hotel and restaurants. Global - Promotion: Muted and unmentioned in advertising. Rosewood hotel marketed itself under its own brand name in addition to participating in Rosewood related advertising. Through the 1990’s, Rosewoods advertising was property-specific (Property name appeared first then the location). In the early 2000’s, Rosewoods advertising began to feature a list of all Rosewood properties, but the Rosewood logo remained secondary to the hotel logo. - Price: Nightly rate ranged from a low of $120 for one night for one of the Saudi Arabian properties to $9000 for a Canadian lodge, Because most Rosewood Hotel users only go once a year customers are not price sensitive. Price ranges among location. - Place: North America (NY, Dallas, Canada), Caribbean (Antigua, Virgin Gorda, St. John), Latin America (Mexico), Middle East (Saudi Arabia), Asia Pacific (Japan, Indonesia) 6. SWOT analysis: Strengths: - - Ability to enhance a property’s value by creating unique, one of a kind properties with a small ultra-luxury residential style the differentiated it from other chains Unique competitive advantage- “Sense of Place” Collection/ Individual Brand Strategy Not price sensitive Strong emotional bonds in successful hotels It Is difficult to position Rosewoods collection of properties Weaknesses: - - Low brand recognition/awareness Collection of brand but not a brand itself Low brand-wide usage among guests While guests were seeking a unique Rosewood property experience and product, they were not making the connection between Rosewood properties and were increasingly identifying with other strong brand hotels Low return rate, only 5% of Rosewood guest stayed in more than one of Rosewood’s properties Opportunities: - New Acquisitions Brand-wide performance development Increase cross-property usage between locations - Growing trends in seeking more experiential hotels Threats: - Customers are increasingly connecting with corporate brands Tough competition from corporate as well as individual/collective brands Competitors with successful frequent-stay programs Natural disasters destroys locations globally 7. Analysis: (Questions From BB) a. Why is Rosewood considering a new brand strategy? i. New President and CEO John Scott (2004) thought it was time to tie in the Rosewood brand to all the individual successful locations. This new brand 0 strategy would also encourage guests to visit the other locations. b. What are the pros and cons of moving from individual brands to a corporate brand? i. Pros: More consumers would visit other locations,Greater Brand Recognition ii. Cons: The cost of Marketing and Operations, losing core consumers to the individual locations, may water down the exclusive (one of a kind) perception of the individual locations. c. Will the move to corporate brand maximize customer lifetime value i.e. does the increase in customer lifetime value justify the investment in corporate branding? i. Math Portion to figure out CLV ii. The increase of CLV will help persuade the board to make the switch to corporate branding. It will show that the cost of both marketing and operations will not be a loss. The main issue was seeing if the customer retention rate would decrease. The hope of corporate branding is so customers could be aware of the other locations and only want to go there. 8. Recommendations: ● Offer rewards to customers who stay in multiple Rosewood locations and have returned to locations. ● Promotion & Ads in the media ● Launch a promotional event ● Develop a community to pursue “Rosewood Junkies”