Hotel marketing, click and brick vs. click and click

By definition a click-and-brick organization is an organization that is both an online retailer and a physical retail store. By definition a click-and-click organization is an organization that has no physical retail store, only an online presence. With the economic fluctuations of the past few years and especially the fall of online businesses in the late 1990s and early 2000s, click-and-click have become less popular due to weariness, and has led to a revitalization in the world market for old fashioned brick-and-mortar industries, and to expand their markets and presence on the World Wide Web or Internet by further expanding or creating an internet site, which is creating a new descriptive term for this type of industry known as the click-and-brick organization. The sale and distribution of hotel rooms online is a growing industry. Online travel sites were visited by more than 17.4 million people in 2004, due to availability, discount prices, convenience, less restriction, and more selection. Despite this new found popularity in online travel sites, there is a concern over the legitimacy of the reservations found there. The following paper is an effort to compare and contrast a brick-and-click hotel, such as Red Roof Inn, with a click and click travel site, such as hotels.com by completing a marketing SWOTT analysis.

In this ever changing economy, it is important for organizations to be their own worst critics. To force organizations to make an objective analysis for comparison with its competition and organization must complete a SWOTT analysis.

Click-and-Click

With the advent of online Click-and-Click travel sites, alternatives to the old fashioned Brick-and-Mortar hotel reservations, which are industry providers that are off-line selling a physical product in the presence of individuals in a physical location by physical agents, are available alternatives for all interested parties. These online travel stores are being used by an ever growing amount of travelers, yet they also have their fare share of controversial issues. Some of these online travel agencies facilitate their operation with the use of hotel contracts, block availability, and email or faxed reservations. The following is a SWOTT analysis of hotels.com.

Strengths: An organizations strengths are based on the internal resources and capabilities used in the development of competitive advantage.

Availability of popular brand names and a wide selection.
Cost advantages; no travel agent commissions or booking fees, considerable discounts offered do to cost saving contracts.
Cost savings; not having to build and operate an actual hotel, contracts with hotels of various brands for quantity of rooms.
Times saving with one stop shopping and instant reservations and confirmation numbers.
Current database system that automatically checks the guests history and or room preferences from previous visits to the web-site.
Interactive marketing allows for greater flexibility in managing elements of the marketing mix. For example, online marketers can adjust prices in response to changing environmental conditions, purchase situations, and purchase behaviors of online buyers.

Weaknesses: These are what needs to be done to insure success, by taking a look internally and considering what must be strengthened.

Limited regulations.
Lack of direct communication with the hotel of choice.
Prepayment required.
Do not have to maintain policies to assure guest confidentiality and the protection of guest identity and guest specific information from inappropriate or nonessential access.
No policies on what comments guests can make about individual hotel properties.
No policies to allow the informing of guests about hotel services being closed, special events in the location of choice.
Travel needs for older generations may be a challenge as technology for some age groups is more difficult than others and access for older users may be non-existent.
Many guests find it difficult to navigate the online transaction process.
Guests could receive accommodations at less that reputable location.
Products and services are similar to many competitors.

Opportunities: New opportunities for growth and profit reveal themselves when the external environment is analyzed.

Make sites more accessible to older users, by designing for accessibility and allowing for phone in reservations. Accessibility can be accomplished by larger button and tabs being larger, and users can navigate via their keyboards or even spoken word, which is handy for those lacking the dexterity to use a mouse.
Convincing guests that their purchase is safe, accurate, and worth repeating.
More quality hotels available for booking.
Instantaneous reservations or bookings.
Increase security in billing processes.
Could corner the market in online reservations.
Big future opportunity for online travel is data mining. The information being collected on every reservation could be very valuable to hotel and other hospitality companies.

Trends: This is big picture information as it relates to the area of organizational focus.

Increase of legal action or government sanctions over online travel sites for guest protection, licensing, and tax issues.
New regulations nd clarification of existing regulations will have impact on travel sites.
Increase in foreign sites.
Increase in Internet-specific regulations.
Growing guest base.

Threats: Changes in the external environment also may present threats to the firm.

New regulations to protect and educate guests.
Substitute housing options.
The potential use of Web-sites by terrorist organizations to obtain travel arrangements and hotel rooms for various purposes.
Technology could become a threat. Database updates and software glitches with the potential for bugs and viruses could also contribute to mistakes. Speech recognition software could confuse some similar sounding words.
Price competition.

Click-and-Brick

The Click-and-Brick term was coined by Kal Raman, The CEO of Drugstore.com

(Kaiser, N., 2000). Click-and-Brick Web-sites are associated with a Brick-and-Mortar hotel and do not take online reservations, but instead require guests to contact the hotel of choice either directly or through the particular hotels central reservation service or toll-free-number. The guest later receives written confirmation in the mail or can receive a verbal confirmation number over the telephone. Click-and-Brick hotels came into being because many hotel guests wanted and needed their hotel rooms immediately. Guests wanted to make reservations online through the hotels directly without going through a middle-man or third party. Red Roof Inn introduced its online reservations as another sales channel to combine its guests Web reservation experience with their on-property hotel stay. The following is a SWOTT analysis of Red Roof Inn hotel.

Strengths: An organizations strengths are based on the internal resources and capabilities used in the development of competitive advantage.

Good reputation among its guests.
It in itself is a strong brand name.
Strong customer loyalty.
Safe.
Regulated.
Direct communication with a hotel reservationist.
Policies to ensure guest confidentiality and protect guest identity and financial information of guests from inappropriate or nonessential access. This is a long standing hotel practice for guest safety and security.
Policies for allowing guests to report hotel experiences.
Policies in place to allow the informing of guests about hotel service interruptions or special events.

Weaknesses: These are what need to be done to insure success, by taking a look internally and considering what must be strengthened.

Possibility of online booking fees.
Higher cost to guests.
A wide selection of locations is not always available.
Cost of building and operating hotel and reservation service.
Products and services are similar to competitors.

Opportunities: New opportunities for growth and profit reveal themselves when the external environment is analyzed.

Offer more incentives (customer discounts, coupons, gifts, loyalty clubs, etc.) when reserving online.
E-commerce is known to drive more traffic into hotels.

Trends: This is big picture information as it relates to the area of organizational focus.

Consumers want more Click-and-Brick hotels; ordering online and staying with the same company.
Hotel chains have expanded to the Click-and-Brick philosophy, which will make it all the more difficult for online travel sites to gain ground with consumers.
Growing guest base.

Threats: Changes in the external environment also may present threats to the firm.

Lack of labor.
Higher room costs.
Price competition.
Higher software costs.

Conclusion

The world of the Internet is redefining the way in which the hotel business is conducted. The wide spread use of online reservation services is increasing with lower prices being a driving force. To compare and contrast these two establishments the using SWOTT analysis, it can be said that both Click-and-Click and Click-and-Brick organizations have a solid future. Click-and-Click offers variety and options, while Click-and-Brick offers security and a name the public knows. Either way guests can find what they want and what they need.

References

Shapiro, J., Wong, K., Perreault, D., & McCarthy, J. (2002). Basic Marketing a Global

Managerial Approach (Canadian 10th edition, Toronto, ON; McGraw-Hill Ryerson Limited.

Kaiser, N. (2000). "The important to budget travel is to prepare in front. When it comes along to family trips, globetrotting, well-deserved trips and/or going to see new places we have never been before, the actuality of expense and budgeting is always in the back of our minds. Planning and expending our travel budget correctly is a main concern for most families. Reducing expending and expenses, while still savoring your vacation to its fullest, is the key to confirmed success and fiscal obligation. Your pocketbook and family will thank you! The thinking regarding economizing money while travelling is simple: Even if your personal budget is really tight, you can still take a break and enjoy life! Simply put, life is just too short to never step out of the door or departing the homestead! Also remembering that while traveling, whether on a price range or not, even the smallest of things can all add op to a big vacation or travel bill!..". Npost.com interview with Kal Raman. Retrieved May 31, 2005, at

http://www.npost.com/interview.jsp?intID=INT00033

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