Collaborating for Growth: The International Hotel Industry
Fyall, Alan, Spyriadis, Athanasios, Journal of Hospitality and Tourism Management
Intense competition and the augmentation of business opportunities are two distinct characteristics of the globalisation of worldwide markets and economies. These trends are valid across many industries but are particularly applicable to the global tourism industry, and more specifically, to the international hotel sector. in its endeavour to exploit the benefits of globalisation, international hotel chains need to adopt a more sophisticated approach to strategic marketing and planning. One approach currently finding favour is that of collaboration. In response to this growing trend among international hotel chains, this paper focuses on horizontal forms of collaboration in the international hotel chain sector. In particular, the paper aims to critically analyse and evaluate key issues and concepts that determine the success of collaborative strategies among international hotel chains in accomplishing business development and seeking competitive advantage in the global marketplace. Semi-structured in-depth interviews with executives and high-level managers of international hotel chains generated salient insights which contributed to the critical analysis and evaluation of key issues specific to strategic collaborative partnerships of international hotel chains. The results of this exploratory study suggest that collaborative strategies enable international hotel chains to compete and develop successfully in worldwide markets. However, given the lack of sophistication in areas determining success in collaborative strategies of the international hotel chain industry, the paper also debates key issues that affect the effectiveness of these practices. The paper concludes by presenting a number of issues requiring further academic scrutiny.
Over recent decades the world economy has undergone considerable transformation. Influenced by advances in technology and the spread of global capitalism, the shrinkage of geographical and cultural distances has allowed companies to widen substantially their geographical markets and sources of supply. This in turn has served as the catalytic focus for the creation of new business opportunities, yet at the same time creating an enormously more complex marketing environment for businesses to operate in. Across virtually all sectors of the global economy, collaboration--frequently in the form of alliances--is reshaping the interactions of companies and transforming traditional business rivalry (Gomes-Casseres, 1996; Spekman, Isabella, & MacAvoy, 2000). As businesses continue to search for the most effective means to strengthen their positioning in this new competitive arena, increasing numbers consider the development of long-term, mutually beneficial collaborative relationships as the solution (Axelrod, 1984; Best, 1990; Cateora & Ghauri, 2000; Dunning, 1997; Hunt, 1997).
The above is of particular relevance to the international hotel industry, where the drift towards consolidation has already produced large-scale international companies and a plethora of collaborative strategies--most frequently marketing alliances, partnerships and consortia (Witt & Moutinho, 1995). A typical example of such relationships is that of The Leading Hotels of the World with the Small Luxury Hotels of the World. Other major hotel chains that have been participating in collaborative partnerships include Accor, Marriott, Bvlgari Hotels and Resorts, and Six Continents Hotels. Hotel chains that participate in collaborative partnerships gain a plethora of advantages. For example, previously heavily dependent on tour operators and other intermediaries, international hotels are now able to achieve economies of scale through cost effective collaborative practices, and gain easier access to worldwide markets; which is in many cases achieved by the use of common reservation systems and customer databases. Marketing strategies of international hotels and hotel chains, therefore, now need to acquire an even greater international perspective and adjust to the new requirements of global competition. …