Fairmont Hotels and Resorts: strategic Overview Case study

Résumé du document

Luxury hotels occupy only a small percentage in the global market today, yet they are continuously on the rise. Fairmont Hotels & Resorts is a leader in the luxury hospitality industry and combines under its brand an outstanding collection of hotels and resorts. Fairmont properties include sophisticated properties as Fairmont Le Montreux Palace in Switzerland, and New York's PlazaHotel. Nowadays, Fairmont Hotels & Resorts is one of the largest luxury hotel management companies in North America. The first Fairmont hotel was opened in San Francisco in 1907, and has been successful ever since. However, their success did not just happen by chance, but through strategic planning. Most of Fairmont's history in San Francisco helped to set up the company's prestige and recognition today.

Extraits

[...] This is a very elite, and efficient way of advertising and growing your customer base. Following the statement of one of Fairmont annual reports, the company's strategic goal was increase the number of hotels under its management through management agreements, strategic partnerships for development, the acquisition of new properties, and the expansion of existing properties” (Fairmont Hotels & Resorts Inc.). As we can see, they were consistent with their policy. In 2002 2004, following the strategy of geographical expansion and strengthening its international presence, Fairmont is continuing to sign management contracts in United Arab Emirates, Egypt, and Europe. [...]

[...] The Fairmont brand was already synonymous in the U.S. for luxury hotels, so taking that a step further, they decided to make it their goal worldwide. A huge part of their strategic plan was to implement various distinct ways of distinguishing themselves from other luxury hotels like Ritz- Carlton and Four Seasons. Considering that there have been a few top brands that have been established worldwide for a longer period of time, Fairmont had to get very creative. Implementing a strategic plan through brand partnering was quite popular with some of their guests. [...]

[...] The decision was to keep two distinct brands, Fairmont Hotels and Resorts and Raffles Hotels and Resorts. However, after the acquisition the management company combined their name to create only one financial entity named Fairmont Raffles Hotels International Inc. The acquisition decision was favorable for all parties in the deal. Taking a glance at the market position of Colony Raffles at the moment of acquisition we can say that Raffles was a fast growing company of collective luxury hotels and resorts, mainly located in the Asian Pacific Rim. [...]

[...] Through globalization making sure you have a team of advisors to educate the company about the specific culture, in which they will be working in, is critical to the company's survival. Fairmont Dubai was able to succeed because of such cross-cultural training. Nonetheless, the true question remains, what made Fairmont Hotels & Resorts so successful in the luxury market? What made them so different in these past two decades? First, they had an effective policy of implementing decisions, their ability to react quickly to an instantly growing and changing market helped keep them a step ahead of their competitors. [...]

[...] In partnering with the prince, Fairmont was able to see their strategic plan of expansion come to fruition. Obviously it is quite clear to see that the company then starts acting more like a hotel management company, because there is another party who actually owns the land and the building. The Fairmont does still own some of their properties, but they realized that to help further achieve their goal, it is very beneficial partnering with someone else to better guarantee success. [...]