Strategic Analysis of Travelodge
Strategy plays a very important place in today business environment. Those organizations without strategic plan are in risk to be taken by those companies that do have one in place. According to Johnson, G. , et al, strategic management is likely to be concern with long-term decisions and direction of the organization, with the core activity of such organization and the way by how the organization can achieve the correct positioning in order to obtain competitive advantage. The chosen organization to be analyzed by this report has been Travelodge.
As a way to fully understand how to implant business strategies and how to differentiate the types of strategy; we will first cover the business context of such organization. We will fully explain their strategic approach and services analysis. In terms of quality Travelodge offers “no frills” standards rooms with all the basics customers need for a good and comfortable night sleep at a cheap price. Its facilities offer an acceptable level of quality and include regular bathrooms, TV, coffe/tea facilities, vending machines and cafe bar (www. 2travelodge. co. uk).
However, a secret investigation carried out by the bighospitality. co. uk pointed out that the cleanliness standard of its rooms is very faulty, despite of the fact that Travelodge claim to offer a reliable level of quality to its customers. According to Slack et al, customers will accept a service of a lower specification quality if the price is low. Therefore, customers believe that the quality of Travelodge services is in accordance with their value-based approach, which defines it in terms of cost and price. Travelodge also offers a dependable website for the booking of its rooms and mobile booking services.
Rooms are available for booking 12 months in advance. Their online services count for a 87% of bookings, therefore they are highly dependable of their website. In order to focus on their core strategy, they outsource the management of its website to ATENDA. This supplier has enabled Travelodge 24 hours a day, 7 days a week availability and support of its website (Atenda. net) They also offer extra services such as breakfast, dinner, WIFI or late check out, both online and face to face, in order to meet customer’s expectation. Therefore, as it can be seen, they are highly aware of customeri?? s particularities.
In order to raise flexibility of their services among customers, there is the possibility to book flexible rooms that may be cancelled or amended until the date of arrival with not additional charges. Moreover, the company also operates a relocation policy; thus if a room is unavailable on arrival they will either provide a room in another hotel or the booking cancellation and money refund. Travelodgei?? s strategy of expansion and development is base on a program of building conversion; therefore it provides a great flexibility to the hotel in setting above or below other uses. According customers reviews, for instance at Tripadvisor.
com, Travelodge offer the possibility to its clients to make complains through their website and the lag time response normally takes five working days. Travelodge makes an effort to study customersi?? needs. Travelodge was one of the first holiday Inn and was Lunched in UK in 1985 and currently UK’s major finest hotel with about 460 hotel across the world with branches in Spain, Germany, and Republic of Ireland and across UK. It was estimated that over 7million people visited Travelodge and like and it figures has risen since then. According to statistics 87% of its reservations were made online at www. travelodge.
co. uk it also has the cheapest room rates which starts from i?? 19 per night. Travelodge currently has the highest number of staff than its competitors with around 6000 staffs. Growth, Travelodge is looking to expand from its current size of 32,000 bedrooms to about 100,000 rooms in addition 1000 new hotels would be created before 2025 and would be achieved according to it spokesperson. 60% of its growth will be achieved from this new development, while 20% would be as a result of converting office blocks and warehouses. Travelodge has targeted towns and city centres around England, and areas like the M25 M11 and A13.
Travelodge currently has about 44 hotels in within the M25 district with the largest number of bedrooms of over 5,780 and it said to be the highest amongst its competitors within the M25 area. In addition seven more hotels are under construction. Travelodge has said to be the highest with over 6,561 bedrooms a 5. 5% share of London hotel market. In 2007 33 new Travelodge hotel was opened the figures grew in 2008 to 42 and in 2009 it was 22 and in 2010 it recorded the highest among its competitors with 74 new hotels Travelodge has targeted areas such as Bristol Cambridge Lancaster Birmingham London Stratford and Greater Manchester.
Low pricing strategy: since its inception Travelodge has been known for its price slashing amongst its competitors encouraging people to use Travelodge is aimed in delivering good value for money commitment to operational efficiency driven by low cost. This year Travelodge will offer rooms for as cheap as i?? 29 or less. Online: online reservation grew to 87% which was easier for customers to book in advance which can be found on their website also the website was easy to access less than 5mins you could book any room of your choice and save the time of walking into any of its branches.
You can also book in advance it attracted over 2. 2 million visitors from around the world each month, in 2008 Travelodge was UK most visited website offering not only cheaper rooms but also customers who are looking to save cost on their travel expenditure turn to Travelodge. Employment: Travelodge employs entry level staff from different employment agencies and also in job centres and the local employment partnership 90% of staff employed into Travelodge where recruited from LEP and there are also working in partnership with job centres to become the highest employment organisation.
67% of employers comes from the local job centres while another 70% from LEP. Product: in the current bid to attract more customers for the 2012 Olympics, Travelodge introduced a bar cafe in 2007. The Travelodge cafe was fashioned with a modern style with a mixture of red white and blue and its rich furnishing and coloured lighting. A stylish flat screen TV and wireless internet system to attract more visitors. The room suite has updated its facilities to reflect the style this design was the first to be introduced since its inception in 1985.