ABSTRACT

This piece of systematic study is on the pricing strategies of hoteliers after recession period with special reference to the accommodation sector of the hotel industry.

In this study author has explored the different types of pricing strategies hoteliers are following keeping in mind the post recession period in india.

Author found conclusion that hoteliers are not sticking to any one strategy rather their plan includes changes in the price strategy in coming future. Initially they are proceeding with the psychological strategy where in price will be charged but that would give good feel to the customers. This can be done by involving in to corporate hospitality concept. Gradually hoteliers have plan to go for the promotional strategies too wherein other benefits will be allowed to the customers at the same price. And overall target is to provide and charge value price.

Towards the fulfillment of this research author referred many books as secondary research, and towards primary research author approached to the five star hotels of Delhi, and questionnaire was used as an instruments of data collection.

ACKNOWLEDGEMENT

I would like to take this opportunity to thank my supervisor Dr. Fredrick Mmieh who helped me understanding and conducting research on my chosen topic. I want to convey my heartiest thanks for keeping me focused on the research objectives.

I would also like to thank to all the managers and staff of the sample hotel for their valuable time while responding my questionnaire.

Last but not least, I am thankful to my family, professors at Brunel University and all my friends whose motivation during all the period of my study has been the main source of inspiration for me.

Chapter 1
INTRODUCTION

The research topic “post recession pricing strategy in Hotel Industry” is mainly includes systematic investigation on the influence of recession on Indian hotel industry. The basic purpose of this systematic strategy is to investigate the influence of recession from the view point of pricing strategy of hotel products with special reference to the accommodation sector.

Rationale: The author has selected to research on the Post recession pricing strategy of hospitality products because this industry and recession is matching with author's area of interest. Author have seen this current recession period practically so author felt to conduct a systematic study about its impact and course of action being taken by hoteliers towards pricing of hospitality products.

PRICING STRATEGY-An Introduction:

There are many ways to price a product. But the right price should be fixed to the product keeping in mind the kind of target segment. In the period of recession and even after post recession pricing decision is not a easy task for the product of hotel industry. Some of the pricing strategy available are- Premium Pricing, Penetration Pricing, Price Skimming, Psychological Pricing, Product Line Pricing, Optional Product Pricing, Captive Product Pricing, Product Bundle Pricing, Promotional Pricing, Geographical Pricing, Value Pricing etc.

http://www.marketingteacher.com/Lessons/lesson_pricing.htm

Out of above mentioned name of the pricing strategy, author focusing on some of them which are relevant for the post recession period and which are suitable for the hotel product.

Premium Pricing: use a high price where there is a uniqueness about the product or services. This approach is used where a substantial competitive advantage exists. Such high prices are charged for luxuries such as cruises Hotel rooms and flights.

Penetration Pricing: the Price charged for products and services is set artificially low in order to gain maret share. Once this is achieved the price is increased.

Psychological Pricing. This approach is used when the marketer wants the consumer to respond on an emotional, rather than rational basis. For example 'price point perspective' 99 cents not one dollar.

Promotional Pricing. Pricing to promote a product is a very common application. There are many examples of promotional pricing including approaches such as BOGOF (Buy One Get One Free).

Value Pricing. This approach is used where external factors such as recession or increased competition force companies to provide 'value' products and services to retain sales e.g. value meals at McDonalds.

http://www.marketingteacher.com/Lessons/lesson_pricing.htm

AIM AND OBJECTIVES / RESEARCH QUESTIONS

Purpose of this research is to investigate the impact of recession on hospitality product and discuss the post recession pricing strategy of the Hospitality product.

Objectives:

* To conduct detailed secondary research on cause and impact of recession.

* To investigate the level of influence of recession in Indian hospitality Industry.

* To investigate the pre recession pricing strategy in hospitality industry for hospitality products.

* To investigate the post recession pricing strategy in hospitality industry.

* To identify the future course of action is needed to make success of post recession pricing strategy of hospitality products- evaluation of corporate hospitality as a marketing tool.

Research Questions:

R.Q.1 how Recession has affected Indian hospitality industry and pricing of hospitality products. ?

This question will help author to understand the level of impact of recession on accommodation sector of the hotel industry in India. In order to search answer of this question author would refer secondary research data that will show the business of pre recession and post recession in Indian Hotel Industry.

R.Q.2 what should be the proper pricing strategy in hospitality industry in this post recession period.?

This research question will lead author to know the right pricing strategy in post recession period. In order to answer this question author would find the different pricing strategy to get the good revenue from the accommodation sector.

R.Q.3 Along with pricing strategy, How corporate hospitality can be beneficial for creating brand image once again.

STRUCTURE OF THE DISSERTATION:

This piece of dissertation is being presented in the systematic order. Author keeping the different chapters of this report in this format- just after the introduction chapter which is chapter 1st, author keeping literature review section of this report which contains information based on secondary research. After literature review, in chapter 3 authors written methodology, and after that a detailed analysis is done with the help of graph and tables which is analysis and discussion on finding chapter, after this there is a conclusion chapter followed by bibliography and appendix section of this report.

Chapter 2

LITERATURE REVIEW

LITERATURE REVIEW

DEFINITION OF RECESSION:

Many professionals and experts around the world believe that a true economic recession can only be confirmed if GDP (Gross Domestic Product) growth is negative for a period of two or more consecutive quarters.

The roots of a recession and its true starting point actually rest in the several quarters of positive but slowing growth before the recession cycle really begins. Often in a mild recession the first quarter of negative growth is followed by slight positive growth, then negative growth returns and the recession trend continues.

While the "two quarter" definition is accepted globally, many economists have trouble supporting it completely as it does not consider other important economic change variables. For instance, current national unemployment rates or consumer confidence and spending levels are all a part of the economic system and must to be taken into account when defining a recession and its attributes.

http://recession.org/definition

CAUSES OF ECONOMIC RECESSION:

An economic recession is primarily attributed to the actions taken to control the money supply in an economy. The Federal Reserve is the agency responsible for maintaining the delicate balance between money supply, interest rates, and inflation. When this delicate balance is tipped, the economy is forced to correct itself.

The Fed sometimes deals with these situations by dumping huge amounts of money supply into the money market. This helps to keep interest rates low, even as inflation rises. Inflation is the rise in the prices of goods and services over a period of time. So, if inflation is increasing, it means that goods and services are costing more now than they did before.

The higher the level of inflation, the smaller the percentage of goods and services is which can be bought with a certain amount of money. There can be many contributing factors for inflation, which include but are not limited to increased costs of production, higher costs of energy, and/or the national debt.

In an environment where inflation is prevalent, people tend to cut out things like leisure spending. They also budget more, spend less on things they usually indulge in, and start saving more money than they did. As people and businesses start finding ways to cut costs and derail unneeded expenditures, the GDP begins to decline. Then, unemployment rates will rise because companies start laying off workers to cut more costs, because consumers are not spending like they were. It is these combined factors that manage to drive the economy into a state of recession.

This set of circumstances, coupled with the ability of people to get access to greater amounts of loan money due to extremely lax loan practices, creates a cycle of unsustainable economic activity that will eventually grind an economy to a near halted existence. You could also say that a recession is actually caused by factors that might stunt the growth that is available from the short term benefits to an economy that can be brought about by such things like spiking oil prices or even war. And while these are very short term in nature usually, they have been known to correct themselves quicker than the full blown recessions that have happened in the past. http://recession.org/definition

EFFECTS OF ECONOMIC RECESSION:

Generally, an economic recession can be spotted before it actually happens. There are ways to spot it before it actually hits by observing the changing economic landscapes in quarters that come before the actual onset. You will still see GDP growth, but it will be coupled with signs like high unemployment levels, housing price declines, stock market losses, and the absence of business expansion. When an economy sees more extended periods of economic recession, it goes beyond a recession and is declared that the economy is in a state of depression.

The only real benefit of an economic recession is that it will help to cure inflation. In fact, the delicate balancing act that the Fed struggles to pursue is to slow the growth of the economy enough so that inflation will not occur, but also so that a recession will not be triggered in the process. Now, the Fed performs this balancing act without the help of fiscal policy. Fiscal policy is usually trying to stimulate the economy as much as is possible through such things as lowering taxes, spending on programs, and ignoring account deficits.

http://recession.org/definition

IMPACT OF RECESSION AND FUTURE COURSE OF ACTION BEING TAKEN BY HOTELIERS IN INDIA:

Below given article gives clear picture of the level of impact of recession in Indian hotel industry and future course of action by Indian hoteliers. The name of the article is "Hotel Industry confident and preparing for better future"

The Hotel Industry in India, which depends to a great extent on the business traveller, is still facing challenges on account of the continuing Global slowdown and cut in corporate travel.

Chennai, Tamil Nadu, November 19, 2009 /India PRwire/ -- The Hotel Industry in India, which depends to a great extent on the business traveller, is still facing challenges on account of the continuing Global slowdown and cut in corporate travel.

The Indian Economy, which was growing at 9%, has been severely affected by the global economic slow down and the GDP growth stood at 6.7 during the year 2008-09. In the present scenario the tourism industry's contribution to GDP has dropped from 6.8% in 2007-08 to 6.1% in 2008-09.

The global downturn, the Mumbai terror attacks, travel advisories issued by the Source markets to India, viz. U.S., U.K., and Europe, and more recently the HINI virus have made a major impact on the Indian Hotel Industry resulting in 12.4% drop in the overall occupancy across country. While the Average Room Rate dropped marginally by 1.9%, the RevPar drop was alarming at 14%. The biggest hit in occupancies has been in Five Star and 4 Star categories.

Presently South India has a total of 664 approved Hotels with a room inventory of 38,000 rooms. By the year 2011-12 The Chennai City will have an additional inventory of 4147 rooms, almost 150% increase on the existing rooms operating in the city. Chennai has a diversified market with various demand generators viz. IT/ITeS Industry, a strong automobile manufacturing base, telecom and electronic industry, it is hoped that the demand will keep pace with the increased room supply though there will be a marginal decline in occupancy.

The table below gives a snap shot of the existing and proposed supply of Hotel Rooms in the branded category entering each of 11 major cities as per the survey done by the HVS Report.

Despite Global economic slow down, India was fortunate to hold on to it's market share and has only lost marginally. Tourism Statistics of 2008 published by the Ministry of Tourism and the future outlook on tourism potential remains positive and promising.

Stimulus packages announced by the Government of India have been a shot in the arm for the Industrial sector, which is now showing signs of recovery and growth. Hopefully a fuller recovery is anticipated by 2010.

We are hopeful that the new Airports in Hyderabad and Bangalore and planned expansion of the major airports in the country will stimulate more taffic into India, both from inbound tourism and business travellers. Fortunately the domestic tourism is growing at a faster rate and with the overall improvement in the economic climate, it is hoped that the Hotel Industry will improve it's over all performance in 2010.

The Annual Convention of the All India Hotels & Restaurants organised by The South India Hotels & Restaurants Association (SIHRA) is now being held in the capital of God's Own Country, Thiruvananthapuram, on 7th and 8th December 2009.

Appropriately, the Theme: for the Annual Convention is "India Tourism - Past Learning and Future Earning" and the choice of venue is Thiruvananthapuram Kerala, God's Own Country, the state which has pioneered the promotion of the Destination oriented tourism among the Indian States. This being the first convention of the All India Hotels & Restaurants in Kerala, the Government of Kerala is rolling out the red carpet and extending maximum support to the organisers in making this a grand and relevant meet.

The Annual Convention of the All India Hotels & Restaurants is being held for the first time in Kerala and we are indeed overwhelmed by the encouragement and support being extended by the Government of Kerala .

The Chief Minsiter of Kerala will inaugurate the Annual Convention and Ministers of both Central and State Governments, will address the Inaugural Session. The Business Sessions will be addressed by key policy makers, senior government officials, Industry Leaders and experts in various fields and will focus on the business opportunity in Kerala, emerging trends in the Hotel Industry and how best we can benefit from the past experience and plan effectively for a better future with confidence.

We have also organised very interesting and exciting Post-Convention Tours to "Back Water Tour of Kerala" and a visit to Sri Lanka. The Sri Lanka tour package We have managed to get very attractive tour package to Sri Lanka an all inclusive rate of airfare, stay, food and transport per person on twin sharing basis at Rs 19365 at 5 star hotels for 3 nights and four days.

We are anticipating excellent response from the Hoteliers and Restaurateurs from all over the country to participate in the deliberations of the Annual Convention and also enjoy the hospitality of the God's own Country and the art and culture.

http://www.indiaprwire.com/pressrelease/leisure-travel/2009111937957.htm

PRICING STRATEGIES:

There are many ways to price a product. Lets have a look at some of them and try to understand the best policy/ strategy in various situations.

Premium Pricing: use a high price where there is a uniqueness about the product or services. This approach is used where a substantial competitive advantage exists. Such high prices are charged for luxuries such as cruises Hotel rooms and flights.

Penetration Pricing: the Price charged for products and services is set artificially low in order to gain market share. Once this is achieved the price is increased.

Economy Pricing: this is a no frills low price. The cost of marketing and manufacture are kept at a minimum. Supermarkets often have economy brands.

Price Skimming: charge a high price because you have a substantial competitive advantage. However, the advantage is not sustainable. The high price tends to attract new competitors into the market, and the price the price inevitably falls due to increased supply. Manufacturers of digital watches used a skimming approach in the 1970s. Once other manufacturers were tempted into the market and the watches were produced at a lower unit cost, other marketing strategies and pricing approaches are implemented.

Premium pricing, penetration pricing, economy pricing, and price skimming are the four main pricing policies/strategies. They form the bases for the exercise. However there are other important approaches to pricing.

Psychological Pricing. This approach is used when the marketer wants the consumer to respond on an emotional, rather than rational basis. For example 'price point perspective' 99 cents not one dollar.

Product Line Pricing. Where there is a range of product or services the pricing reflect the benefits of parts of the range. For example car washes. Basic wash could be $2, wash and wax $4, and the whole package $6.

Optional Product Pricing. Companies will attempt to increase the amount customer spend once they start to buy. Optional 'extras' increase the overall price of the product or service. For example airlines will charge for optional extras such as guaranteeing a window seat or reserving a row of seats next to each other.

Where products have complements

Captive Product Pricing Where products have complements, companies will charge a premium price where the consumer is captured. For example a razor manufacturer will charge a low price and recoup its margin (and more) from the sale of the only design of blades which fit the razor.

Product Bundle Pricing. Here sellers combine several products in the same package. This also serves to move old stock. Videos and CDs are often sold using the bundle approach.

Promotional Pricing. Pricing to promote a product is a very common application. There are many examples of promotional pricing including approaches such as BOGOF (Buy One Get One Free).

Geographical Pricing. Geographical pricing is evident where there are variations in price in different parts of the world. For example rarity value, or where shipping costs increase price.

Value Pricing.This approach is used where external factors such as recession or increased competition force companies to provide 'value' products and services to retain sales e.g. value meals at McDonalds.

http://www.marketingteacher.com/Lessons/lesson_pricing.htm

Pricing strategy is very crucial process for any business organizations. Before fixing the price of a product its very important to decide the overall strategy of the business organizations.

By service from experience tight cost and overland customer efficient account and cost so the years force in recent the which suggests that in such control avoidance of marginal customer and so advertising and from tight cost usually

As suggested by Bagewadi (2002), organizations that pursue the generic strategy of overall cost leadership seek to become the lowest cost producers in the industry. By emphasizing cost control, such organizations aim to make above average returns even with low prices. This strategy usually involves "the construction of efficient-scale facilities, rigorous pursuit of cost reductions from experience, tight cost and overhead control, avoidance of marginal customer accounts, and cost minimization in areas like R&D, service, sales force, advertising, and so on" (Ghosh, 2001)). Research, which suggests that in recent years, the competitive strategy of cost leadership has received much attention.

The generic strategy of differentiation, on the other hand, aims at creating a product or service that is unique. Such organizations hope to create brand loyalty for their offerings, and thus, price inelasticity on the part of buyers. Breadth of product or service offerings, technology, special features, or customer service is popular approaches to differentiation. The differentiation strategy must typically be supported by heavy investment in research, product or service design and marketing.

While both overall cost leadership and differentiation strategies are aimed at the broad market, firms may also choose to confine their product or service offerings to specific market areas or may choose to offer a smaller line of products or services to the broad market, thus pursuing a strategy of focus or niche (Johnson and Scholes, 2005). In other words, such organizations pursue a strategy of cost leadership or differentiation either in a specific market or with specific products or services.

Cost leadership and differentiation strategies as being mutually exclusive According to Porter, each of these strategies represent "a fundamentally different approach to creating and sustaining a competitive advantage" (Johnson and Scholes, 2005). Earlier researchers, following Porter's contention, assumed that these strategies were mutually exclusive.

According to (Johnson and Scholes, 2005), analysis of one's competitors has long been a critical component of firms' competitive preparation. Although many different competitive analysis tools exist, and there is wide variance in their use among firms (Kazmi, 2004), it is assumed in some of the major strategic theories that competitors know each other fairly well. Two significant views in the strategy field have suggested that firms actively engage in competitive analysis in order to understand how their own firm matches up against its competitors. As one significant strategic view, Institutional Theory suggests that firms become more similar over time provided they are in the same organizational field (Ghosh, 2001). In contrast, the resource-based view (RBV) of the firm claims that firms look for some way to be unique in order to gain a competitive advantage. Institutional Theory and the RBV both assume that firms are able to grasp the similarities and differences between themselves and their competitors.

For hotels to become more similar to or more different from their competitors, they must accurately recognize the specific areas in which they are already similar to and different from their competitors. For example, Institutional Theory presumes that firms come to know one another through competitive and social interactions, membership in common industry associations, professional networks, and the hiring of employees from other firms in the same industry (Walker, 2006). Although the Resource-based view (RBV) of the firm does not make all the same claims as to how firms get to know one another, the implication is that through normal competition and competitive analysis, firms increase their understanding of their competitors.

At root the study of hospitality as a human phenomenon involves the relationship between hosts and guests. As such the study involves three broad dimensions which were outlined in “In Search”. Although some have found this framework difficult to accept, or too crude (Slattery, 2002; Brotherton, 2002), it does provide an attempt at a framework within which to locate the study of hospitality. At a social and cultural level, different societies require varying degrees of obligation to be hospitable with duties and obligations on both guests and hosts. Importantly, these obligations do change over time as a result of “modernity” or increased contact with tourists. Many of those approaching the study of hospitality from social science disciplines are interested in relationships between host communities and between tourists, but also migrants and asylum seekers (Garcia and Crang, 2005). On the private or domestic level individuals learn about hospitality in the home settings which can be seen as producing a more genuine and authentic hospitality. In addition, the dominant numbers of small hospitality firms offering food and drink, and/or accommodation are in, many ways, a form of “commercial home” where the commercial activities are intrinsically interwoven within the domestic and private setting. Also in commercial dimension of hospitality (and related tourism) activities, the study of host and guest relations, together with an understanding of the emotional dimensions present in hospitality service interactions, can better inform the development of effective competitive strategy (Hage, 2005).

Recent debates about hospitality management practice which despite the rhetoric of the value of both internal and external customers, continues to prioritize short-term cost management can be better informed from a critical perspective. Lucas (2004) suggests the existence of two different approaches as high- and low-road employment practices. Whilst she acknowledges that some firms do adopt a more high-road approach, she also suggests that few US and British workplaces are managed in this manner. She goes on to suggest that one reason for this is that labour costs are more easily manipulated than other semi-variable or fixed costs and this leads to a situation where “actions will be driven by short-term financial targets, and working to budgets will drive a short-term employment relations agenda, encouraging low road practices” (Lucas, 2004, p. 65). In stakeholder terms, priority is given to shareholder/owner's interests over those of employee and customer stakeholders. High road practices prioritise customer and employee stakeholder interests. In the long-run it is said that all stakeholders benefit but managers are locked into reporting systems which give priority to financial performance, trading period results, and shareholder interests. Using Fox's model of analysis, unitary perspectives dominate management practice and few recognise even the potential plurality of interests within hospitality organisations. Academic commentators must go beyond both these positions.

Botterill (2000, p. 194), for example discussing the mismatch between the economic importance of hospitality and tourism and their low-political status as industries, says:

To understand the mismatch between economic importance and political status requires a Marxist sense of the objectivity of the ideological structure. In this case an ideology that clearly contains an implicit ranking of economic activity and subordinates hospitality to other dominant interests despite the fact that it has over taken those economic interests in importance. The social actors who construct the meaning of hospitality become, therefore, the target for the politically-reflective practice of critical social science whose aim is to transform (Molz, 2005).

Critical theory has a long tradition in the social sciences, often opposing approaches to social science research which were based on the natural sciences. These more positivistic approaches to social issues frequently claimed a scientific value-free neutrality, but which “became regarded as a form of covert ideology, which obscured objections to a repressive social order by studying people as objects rather than subjects, ignoring the subjective meanings in social actions” (Simons, 2004, p. 5). The linkage between critical theory and explanations of social actions and forms in the way they influence presuppositions about enquiry is an important one. Simons (2004, p. 6) provides the following overview:

In a more general sense, however, critical social theory, refers to qualitative theories which adopt hermeneutic strategies in seeking to interpret and understand social action in contrast to quantitative approaches, and at the same time evaluate as well as describe and explain social action.

Critical theory enables the study of hospitality through the meanings associated with by the various participants in hospitality transactions. Lynch's (2005) work exploring the experiences of being a guest in small hotels and guests houses, for example, provides insights into the use of public and private spaces in the commercial home sector. He suggests that there are some interesting conflicts of meanings and intents between hosts and guests. Often guests chose this form of accommodation because they wish to experience “genuine hospitality” with a “real family” whilst hosts frequently want to maintain their own private space which is excluded from their paying guests.

Randall's (2000) work on the meanings created by television food programmes also adopts a critical theory perspective. She uses the work of Bourdieu, developed to analyse literary and cultural outputs to be able point to signs and signifiers that develop meanings. Similarly work on special meal occasions (Lashley et al., 2005) also employs semiotic analysis so as to build a picture of the ways individuals recount special meal occasions. Many of these techniques have been used in developing analysis of media outputs in print and broadcast media. Critical theory is able to show how media production, despite claims for independence, frequently creates an impression of inevitability of existing social and political structures.

IMPLEMENTATION OF PRICING STRATEGY ALONG WITH THE STRATEGY OF CORPORATE HOSPITALITY- A WAY TO MAXIMISE THE REVENUE OF ACCOMMODATION SECTOR.

Corporate hospitality is all about providing excellent opportunity to somebody with some sort of reward. It provides and excellent opportunity to improve the overall impression or in other terms, creating good picture about one's company, products and services that they offer so as to remain in the good books of their desired audience who are linked to their success. In the light of these revelations primary data was collected to determine as whether corporate hospitality improves the overall impression of a hotel. The data collected reveals that on greater level, corporate hospitality improves the overall impression of hotels.

A general failure to apply strategic approaches would imply that better management of corporate hospitality could result in the function making even greater contributions to corporate communications in the future. At the theoretical level, outcomes to this type of investigation contribute to the theory of “liking” and the determinants of liking in the corporate sphere. In the light of these revelations primary data was collected to determine as whether corporate hospitality highly effective marketing tool for hotels. The data collected reveals that corporate hospitality is highly effective marketing tool the hotels.

“Corporate hospitality is a powerful marketing tool for targeting key customers. Corporate hospitality provides us with the opportunity to thank reliable customers and attract new clients, in a way that promotes tremendous goodwill and friendship. Corporate hospitality at a prestigious event provides with the ideal medium to invite customers and more importantly to get invitations accepted” (Abbey, 2005). This definition manifests that corporate hospitality has emerged as a necessary and valuable strategic marketing tool and it has become an important component of business sponsorship. This marketing tool significantly highlights the business impression of the company.

EMERGING TREND OF SERVICE IN HOSPITALITY

The use of the term hospitality to describe commercial hotel and catering activities is an interesting example of the use of language to influence social meanings and perceptions of activities. Hospitality emerged in the USA in the late 1970s/early 1980s as a label for the industry, for the title of academic journals and subsequently for the field of study and for academic departments, programmes and subject associations. Taking a more interpretive approach allows recognition of the word to convey meanings influenced by cultural, historical, domestic and everyday meanings of hospitality to describe activities which are founded on commercial relationships. The “hospitality industry” suggests a relational dimension, that of offering hospitality, and its associated benefits of welcome, of security, of being a revered guest, etc. Hotels, restaurants and bars on the other hand are establishments which are recognised as offering goods and services at a price. Hospitality allows impressions to be created of emotional needs being met and benefits beyond the merely commercial. At the same time, hospitality has allowed academics to engage with a discourse that explores these wider meanings beyond the commercial spin intended in the first instance. Hospitality, therefore, represents an interesting paradox, as originally intended, it was obfuscating and designed to mask the commercial purpose of the sector, yet at the same time it has opened up a rich radical route of enquiry that can be used as a critique of commercial organisational practice (Lashley, 2000).

Earlier observations (Lashley, 2000) suggested that hospitality could be conceived of and studied in three domains which are independent of each other but which overlap shown visually as a Venn diagram. Admittedly, this was a somewhat crude and over simplistic representation, but the three domains do provide a framework for analysis and discussion of current work as well as future directions for research activity. In other words, the study of hospitality can encompass the social cultural contexts of hospitality, the practice of hospitality in private domestic settings and the commercial setting of hospitality. The benefit of the Venn image is that these three domains are not hermetically sealed but overlap and inform each other, and that studies can focus on any one of a range of overlapping relationships.

Although the notion of the social or cultural domain have caused some commentators difficulty (Brotherton, 2002), the study of the responsibilities associated with being a good host are a feature of social constructs which are rooted in a society's culture. In so-called modern societies the duty to protect guests, to provide succour, to take in the poor and share food and drink and provide secure accommodation to guests are much less explicitly pronounced than in pre-industrial societies. The strength of these obligations are, however, still relevant today in many parts of the world. At the time of writing, for example, the person responsible for betraying Sadam Hussein's sons to US forces in Iraq is himself a fugitive, because his tribe claim that he dishonoured them by betraying his two guests to their enemy. He broke the tribe's sacred code of hospitality, to provide protection to those who were guests in his own home. In this case, the two sons were killed during the attack by US troops on the house in which they were sheltering.

The changing nature of perceptions of guests and the rigidity of obligations for hosts to meet socially defined standards of hospitality is an important issue for future research in host and guest relations. Evidence from British history suggests that social and cultural obligations to be hospitable lasted into the medieval period but began to break down in the sixteenth and seventeenth centuries. Several of Shakespeare's plays use the dishonouring of the laws of hospitality as a device to increase the villainy of a character's actions - the killing of Duncan whilst a guest in Macbeth's house, the blinding of Buckingham by King Lear's sons-in law leads him to cry out, “But you are my guests”. Contemporary audiences would have understood that these acts were breaking the laws of both hosts - to protect their guests, and of guests to act honourably to their hosts. Obligations in Western societies to behave honourably as guest or host have nothing like the same cultural sanction as they once had.

To some extent these obligations to be hospitable have changed as a result of increased travel and the emergence of commercial provision to support travellers has developed. Certainly, there are important lessons to be learnt from the study of the social and cultural domain of hospitality. Firstly, different societies will have degrees of culturally defined obligations to be hospitable. Some cultures will require individuals to meet certain levels of expectation to offer hospitality to strangers. Thus, different societies will be more or less predisposed to be hospitable to the stranger/tourist. Secondly, obligations to offer hospitality to strangers changes over time. Increased contact with visitors seems, particularly in commercial tourist contexts, can also change these obligations to be hospitable. Familiarity, it seems, can breed contempt. Thirdly, it is possible to re-introduce frontline hospitality and tourist staff to these obligations to be hospitable through training and management practice. Walton's (2005) various works on the history of British seaside resorts confirms the reluctance of sections of the seaside host community to accept visitors. Local populations made up of large numbers retirees, for example, often acted as a brake on the ability of the local tourism industry to adapt and change with changes in consumer demands. Retirees, making up a political lobby, would actively limit tourism industry attempts to attract more tourists to the town.

The private domain of hospitality has inspired some interesting studies over recent years. On one level, the private/domestic domain is an important arena for learning about receiving guests and the obligations of the host. Half the accounts of “special meal occasions” (Lashley et al., 2005) were located in domestic settings, and the language of domestic hospitality was used to evaluate hospitality in commercial settings, “they made me feel at home” for example. O'Mahony's (2003) profile of five leading restaurateurs in Australia suggested that learning about food and dining in the home was a common source of inspiration. In some cases, learning to cook with a mother or grandmother was important source of skill. In other cases, the experience of food and drink, and hosting, provided a source of inspiration that became invaluable when they entered the restaurant business.

On another level, many hospitality businesses are themselves “commercial homes” (Lynch and MacWhannell, 2000). Commercial homes (Lynch, 2005) in guest houses, bed breakfasts establishments, farm-stay properties and small hotels in particular involve guests staying in the same dwelling as the host. Lynch and MacWhannell provide a useful model for understanding the relationships between paying guests and hosts depending on the degree to which they share domestic private space. Although the interface between resident guest and host are at their sharpest in the accommodation sector, pubs, inns and bars, and some restaurant and café businesses have close links between the home and the commercial activity.

These linkages between domestic and commercial domains in micro-firms in hospitality and tourism, has important implications for those attempting to provide assistance to small firms in the sector, or to improve the quality of services experienced by visitors. The business motives of lifestyle firms are more closely associated with a personal and domestic agenda, and do not readily recognise the need for formal management practices. In many cases, high levels of business failure and churn in ownership have a negative effect on overall business development for the tourism profile of the destination. For example, estimates of the change in ownership of Blackpool hotels was conservatively estimated at 20 percent per year, though some professionals suggested it could be as high as 50 percent (Lashley and Rowson, 2005), whilst estimates of changes in pub tenancies in the UK were thought to be in the region of 30 percent per year (Lashley and Rowson, 2001).

There has been on-going debate, in particular, about the extent to which commercial hospitality can be authentic when compared with private hospitality. Warde and Martens (2001) for example, in their interviews covering dining experiences said that interviewees tended to regard commercial dining experiences as being less authentic than those in domestic settings. Certainly, the philosophy of hospitableness suggests that the ulterior motives associated with commercial hospitality might reduce the genuine quality of hospitableness. Whilst recognising this as a potential tendency, Telfer (2000) suggests that it is not inevitable that commercial hospitality is inhospitable. She suggests that individuals who are naturally hospitable may be attracted to work in the sector and provide hospitable behaviour. She also points out that many small firms may be operated for other than commercial reasons and these may offer genuinely hospitable experiences. Lashley et al. (2005) found that interviewees were able to recognise hospitality experiences as being genuine in both commercial and domestic settings. When asked to recount their most memorable meal experiences about half the occasions were in domestic settings, whilst the other half was set in commercial settings. Interestingly, both appeared to be recognised as having authenticity, though the language of domestic hospitality was used to evaluate experiences in commercial settings. Emotional requirements to feel safe and secure, welcome and genuinely valued dominate the assessment of authenticity in both settings. Ritzer (1993) suggests that there are McDonaldizing and globalizing tendencies, particularly in corporate hospitality provision that will create increased inhospitable hospitality in the commercial sector. The relationship, therefore, between private and commercial settings of hospitality provides some interesting insights into hospitality and some exciting avenues for research.

MG - 5510 DISSERTATION 2009

Effective Pricing & Revenue Management Tactics for a Post-Recession World- By Francois Mourier

The smith Travel research Hotel Data Conference last month revealed that more than 50% of hotel industry professionals believe that industry -wide Rev PAR rates will not recover until the third quarter of 2010 or after.

As a company dedicated to optimizing the are we also feel that a recovery will come gradually to our industry, and that the quick turnarounds the lodging industry has encountered after previous recessions are unlikely to occur this time - sadly. We see demand remaining soft, with rates reflective of consumer's lingering emphasis on value, and overall occupancy to remain well below 2008 averages until at least the 2010 summer travel season.

But we also see a silver lining in this dark grey cloud: it's widely accepted that the worst is over. It's time for us, as an industry, to step outside the confines of the recession - and the 'recession mindset' - and start implementing forward-thinking strategies for a post-recession world.
We believe that revenue management- with an eye toward maximizing RevPAR, not necessarily occupancy or ADR alone - will become increasingly important for the industry during the recovery phase. Hotels must start embracing cost-effective revenue generation measures; these measures will become the foundation for healthier margins in the future.
There is no reason why hotels cannot take advantage of the many sales channels available today and use the consumers' need for value to really boost sales.

Effective revenue management, in this environment, must include the ability to adjust rates dynamically, automatically, across multiple channels; to take into account competitors rates and minute changes in demand; and incorporate these new-economy metrics with traditional revenue management tactics like historical and seasonal pricing. Our business has undergone immense change and so too must our strategies.

Above all, this is not the time to discount. The fact that value remains a top concern for consumers isn't necessarily a bad thing for hotels and resorts, but it doesn't mean that you should give away your house (or hotel). It opens up the opportunity for competition based on price across service levels, and encourages properties in the upper service categories to emphasize the value of their offerings.

More importantly, it highlights the importance of effective revenue management tools, and allows hotels that dynamically manage their rates to enjoy a competitive advantage over those that don't - all of which are good things.

Yes, it's going to be a longer recovery, but we truly believe that the properties implementing forward-thinking revenue management strategies and systems today will be those that benefit most tomorrow. We encourage hoteliers to use all of the technical and strategic advantages that the waning recession has to offer to improve their position for when we are truly free and clear of the recession clouds.

http://www.htrends.com/trends-detail-sid-41735.html

Chapter - 3

METHODOLOGY

Chapter 3

M E T H O D O L O G Y

3.1 RESEARCH DESIGN

The design of research is determined by the nature of the problem that has to be explored and the research question that is formulated. The statement regarding the nature of the problem will identify concepts that have to be explored and that would influence the data collection methods, the subsequent data analysis and reporting that would influence the data collection methods, the subsequent data analysis and reporting that are required (Hamel, 1993).

Philosophy of research design says that research can be based on its objectives like, Exploratory, Descriptive, Explanatory, and Predictive or a combination of two or three kinds. Exploratory research- this type of research is involved in Exploration of new thing like applied kind of research. Descriptive kind of research is describing any concept, Explanatory research is to explain the reasons also and Predictive kind of research involves prediction about the consequences of the solution of the problem.
3.2 RESEARCH APPROACHES

Research approaches can be qualitative, quantitative or both (Schiffman and Kanuk, 2000). The selection of the particular research approach depends on the kind of information required. Qualitative research collects, analyzes, and interprets data that cannot be meaningfully quantified, that is, summarized in the form of numbers. For this reason, qualitative research is sometimes referred to as soft research. Any study using nonstructured questioning or observation techniques can be labeled qualitative research. However, qualitative research typically studies relatively few respondents or units. In other words, a study of a large, representative sample would normally not be called qualitative research even if it used some nonstructured questions or observations. The nonstructured and small-sample features of qualitative research techniques have an important implication. They are intended to provide initial insights, ideas, or understanding about a problem, not to recommend a final course of action. Therefore, qualitative research techniques are most appropriate in situations calling for exploratory research. Quantitative research, in contrast to qualitative research, is characterized by more structure and larger, more representative respondent samples. Consequently, the logical place for quantitative research techniques (usually in the form of large-scale questionnaire surveys or structured observations) is in conclusive research projects. A primary role of qualitative research is to generate hunches or hypotheses that can be mary role of qualitative research is to generate hunches or hypotheses that can be tested through more formal research. In contrast, each of the situations under “Quantitative Research” calls for very specific data, capable of suggesting a final course of action. A primary role of quantitative research is to test hunches or hypotheses (Parasuraman, et al. 2004).

The definition and characteristics of qualitative and quantitative research approaches that have been presented above suggest us that qualitative approach is a soft research approach in which collected and identified cannot be meaningfully quantified and more importantly in this approach non-structured research is conducted; but so far as quantitative research approach is concerned, in this approach structured research is conducted with approaching larger respondents and the collected data can be meaningfully quantified.

This piece of work is based on qualitative research approach.

3.3 TYPES OF DATA AND ITS COLLECTION METHODS

Research data can be collected either in the form of secondary or primary or both. Generally in academic research both secondary and primary forms of data collection are used (Clark et al, 2003). Therefore, in this research also, both primary and secondary form of data collection has been adopted.

3.3.1 Secondary Data

Secondary Data usually factual information can be obtained through secondary data; those have already been collected from other sources and are readily available from those sources (Parasuraman, et al. 2004). The definition and characteristics of secondary data presented above suggest us that secondary data are data that have already been collected for purpose other than the problem in hand. Before detailing as how and what secondary data were collected in this research, in would be worth to examine the advantages and disadvantages of such data.

3.3.1.1 Advantages and disadvantages of secondary data:

Secondary data are easily accessible, relatively inexpensive, and quickly obtained. Some secondary data are available on topics where it would not be feasible for a firm to collect primary data. Although it is rare for secondary data to provide all the answers to a non-routine research problem, such data can be useful in a variety of ways (Kotabe, 2002).

Secondary data can help you: Identify the problem, better define the problem, develop an approach to the problem, formulate an appropriate research design (for example, by identifying the key variables), answer certain research questions and test some hypotheses and interpret primary data more insightfully. Because secondary data have been collected for purposes other than the problem at hand, their usefulness to the current problem may be limited in several important ways, including relevance and accuracy.

The objectives, nature, and methods used to collect the secondary data may not be appropriate to the present situation.

Also, secondary data may be lacking in accuracy, or they may not be completely current or dependable. Before using secondary data, it is important to evaluate them on these factors (Malhotra, 2004).

Although so many handicaps are associated with the secondary data, but such data were found useful in this research as identifying the problem, developing approach to the problem, answering some research questions and interpreting primary data. The secondary data in the present research were collected from books, journals, periodicals, newspapers and magazines.

3.3.2 Primary Data

A researcher originates primary data for the specific purpose of addressing the problem at hand. Obtaining primary data can be expensive and time consuming (Malhotra, 2004).

The definition of primary data presented above suggests us primary data are those data that are collected for the particular purpose of research in hand.

The disadvantage of collecting primary data is that it is lengthy and resource and time consuming process (in comparison of secondary data), but the advantage of primary data is that they are first hand information that are comparatively more reliable (than secondary data). Primary data can be collected from various sources and methods that are case studies, observation, questionnaire survey and interview (Clark et al, 2003).

3.3.2.1 Instruments of Primary data collection:

Interview technique, questionnaire technique, By the way of observation etc are the basic instruments of data collection.

Interviews can be structured or unstructured (Clark et al, 2003). The nature of unstructured interviews is very vague, so in the present research structured interviews were conducted which is conducted with the help of structured questionnaire.

The interview as a form of research and a method of collecting qualitative data is at its most useful when it gives us insight into how individuals or groups think about their area of operation or world, how they construct the ‘reality' of that world. Although it may seem that this is not that different a method of collecting data through a questionnaire, the interview often allows for extra comment or observation to be made by the interviewee, which helps you as researcher to identify and assess emotions, values and attitudes. These may be explicit in that the interviewee articulates them in response to a question, or may be implicit in the tone or language of a response, and it is up to you through your kills as an interviewer to interpret the non-verbal communication as well as the verbal (Clark et al, 2003).

An appreciation of how the type of interviewing method influences questionnaire design can be obtained by considering how the questionnaire is administered under each method. In personal interviews, respondents see the questionnaire and interact face to face with the interviewer. Thus, lengthy, complex, and varied questions can be asked. In telephone interviews, the respondents interact with the interviewer, but they do not see the questionnaire. This limits the type of questions that can be asked to short and simple ones. Mail questionnaires are self-administered, so the questions must be simple and detailed instructions must be provided. Questionnaires designed for personal and telephone interviews should be written in a conversational style (Malhotra, 2004). Interviews in this research were conducted face-to-face and telephonic structurally with having a designed and defined questionnaire.

Questionnaire

Questionnaire is the other instrument of data collection. The researcher designed his questionnaire considering the data required for achieving research objectives and research questions. Again the research questions can be structured and unstructured. The former relates to open ended questions whereas the later close ended. But only structured questions should be included in the questionnaire considering the simplicity, easier to answer and straight forwardness. Respondents are generally unwilling to answer the unstructured questions but take interest in answering structured questions.

3.3.2.2 Sampling and its techniques:

Sampling : One of the most important parts of the interview process is to determine the people (sample) that are approached for the interviews. There are various methods of selecting the sample and the most common are randomly and conveniently (Clark et al, 2003).

Sampling techniques:

Non-probability or judgemental sampling

Probability or Representative Sampling

Non-probability sampling

Non-probability sampling is that sampling procedure which does not afford any basis for estimating the probability that each item in the population has of being included in the sample. Non-probability sampling is also known by different names such as deliberate sampling, purposive sampling and judgment sampling.” (Kothari - 1990, pg 73)

Probability Sampling

This type of sampling is most commonly associated with survey-based research where you need to make inferences from your samples about a population to answer your research questions or to meet your research objectives. (Saunders - 2003, pg- 153)

Types of Probability based sampling techniques:

Simple random Sampling, Systematic Sampling, Cluster Sampling, and Stratified sampling. All these types of probability based sampling techniques gives equal opportunities to each elements of the sampling frame to be the part of sample. Simple random sampling includes selection of the sample at random basis from the sampling frame using either random number tables or a computer. Systematic sampling technique required following a system while choosing samples. Cluster sampling techniques creation of a cluster as per the requirement of the research objectives. Stratified sampling includes division and selection of the samples as per the strata.

3.4 AUTHORS APPROACH IN THIS RESEARCH:

On the basis of basics of the primary research mentioned above, author has been developed methodology for this research. To achieve aim of this research author followed this methodologies which given below:

Universe: This research is based on five star hotels and related with the pricing strategy of accommodation sector of hotel industry. So for the purpose of this study all five star hotels of Delhi were the part of universe. Further marketing department and managers of chosen hotels out of the entire universe hotels of Delhi were universe for this study.

Sampling Technique:

Author followed Simple random sampling technique. Author applied simple random sampling technique to choose sample hotels out of all five star hotels of Delhi. Author created a sampling frame -for the hotels and then this technique was applied. It is because author wanted to give the equal opportunity to each of the hotel and its marketing managers to be the part of sample. (A sampling frame of the Hotels are given in appendix section of this report)

Samples: on the basis of above mentioned techniques author chosen these hotels as sample hotels:

  • Le Meridien
  • Hotel Samrat
  • Hotel Ashoka

Samlple size: Keeping in mind time and convenient factor as limiting factor author had decided to have 10 respondents from each three hotels. So in totality there were 30 as sample size.

Instruments of Data collection: Author followed questionnaire only as an instrument of primary data collection. It is because other mostly used technique - Interview, was not possible for the author because most of the hotel managers does not have sufficient time to give appointment-even telephonic, this fact was disclosed when author approaching them for the telephonic interview. So author preferred questionnaire based data collection. It was mailed to them. Author believe that as per the requirement of this study questionnaire has been fulfilled the objectives. Response rate was 25 out of 30, which is 83%.

3.5 LIMITATIONS

Due to limited time and resources (as usually happens with academic research), the researcher had to downsize his plan on various fronts. Getting an appointment with the respondents was not easy as in some cases they had tight schedule in their business, where as some were found unwilling to be contacted even over the phone. Anyway, the researcher managed to approach the target sample. Due to limited provided time the researcher could not followed telephonic interviews.

3.6 DATA ANALYSIS

In qualitative research, the moderator or test administrator usually analyses the responses received. So close-ended responses has been first coded and quantified; then all of the responses are tabulated and analysed. After the data was collected through the methods mentioned above, it has been analysed systematically. This was done by writing all the key things in a systematic order, as is done in a questionnaire. After viewing the key themes, answers were written down. Then the different reply were studied and analysed for each question. As the responses of were varied and inconsistence, the analysis has been done through simple tabulations and percentages methods.

Chapter 4

ANALYSIS & DISCUSSION OF FINDINGS

Chapter 4.

ANALYSIS & DISCUSSION OF FINDINGS

Response rate in this piece of research was 83%, as 30 managers were approached and 25 gave response to the questionnaire placed to them.

Towards the analysis of the placed questionnaire author is analysing each questions individually with its response rate and outcome has calculated in percentage format so that it would be easy to conclude.

1. What would be the choice of yours towards pricing policy of your product- accommodation sector?

Factors

No. Of Respondents

Response in Percentage

(A) Premium pricing

(B) Penetration Pricing

(C) Psychological Pricing

17

68%

(D) Promotional Pricing

2

08%

(E) Value Pricing

6

24%

Out of the given option of types of pricing strategy maximum respondents opted psychological pricing strategy as pricing strategy to face post recession market competition and generate more revenue.

2. Do you feel that any one strategy would be applicable for longer period?

Factors

No. Of Respondents

Response in Percentage

YES

00%

NO

25

100%

Though while replying to the question number 1, all the respondent opted their choice but when it was asked whether that only policy will be for long term then answer is different and all are opting NO. this implies that only one strategy for pricing will not be the choice and there will be something mixed. This indicates that only one strategy will not work.

3. If No, then what would be the choice of strategies? Please rank your choice in the order of 1 to 5, where 1 would be the first choice 5th would be the last.

Factors

No. Of Respondents

Response in Percentage

(A) Premium pricing

(B) Penetration Pricing

(C) Psychological Pricing

5

42%

(D) Promotional Pricing

4

33%

(E) Value Pricing

3

25%

This shows that psychological pricing strategy is the need of today but for coming days, months or even years there will be change in the strategy and those would be in a sequence of promotional and value pricing strategy.

4. In this post recession period, keeping in mind the recession impact, besides pricing strategy do you believe corporate hospitality would be helpful in fighting with recession impact?

Factors

No. Of Respondents

Response in Percentage

YES

25

100%

NO

00

00%

This question was asked to find solution of long term objective and as future course of action. So towards the same reply of the respondents is very much convincing that it would be a good step to focus on corporate hospitality as a marketing tool.

5. In your opinion, which is the most prevailing domain of corporate hospitality…?

Factors

No. Of Respondents

Response in Percentage

Social and cultural domain

8

32%

Economic domain

17

68%

The data in the above table makes clear that; for 68% (17) of the total 25 respondents, the most prevailing domain of corporate hospitality is ‘economic domain'; whereas some 32% (8) respondent find ‘social and cultural domain' as most prevailing domain of corporate hospitality. These data summarizes that the most prevailing domain of corporate hospitality is social and cultural domain.

According to research literature , corporate hospitality is actuality an event on the company expenses for the entertainment of the existing clients or employees or the prospective clients in future with the aim of getting benefited. According to Rao (2004) , corporate hospitality is all about providing excellent opportunity to somebody with some sort of reward. It provides and excellent opportunity to improve the overall impression or in other terms, creating good picture about one's company, products and services that they offer so as to remain in the good books of their desired audience who are linked to their success. The entertainment of existing clients and prospective clients, the corporate hospitality also includes meeting with staff or awarding them so as to win their confidence or in other words making them faithful towards the company so as they could perform to the best of their abilities to achieve the overall aims and objectives of the company which in turn helps in their retention.

In the light of these revelations primary data was collected to determine as whether corporate hospitality can be considered as a good marketing tool and improves the overall impression of a hotel. The data collected reveals that on greater level, corporate hospitality improves the overall impression of hotels. For 64% (15) of the total 25 respondents, they believe ‘to great extent' that corporate hospitality improves the overall impression of hotels; whereas some 40% (10) respondents believe this ‘to some extent' (see table and figure below).

6. To what extent do you believe that corporate hospitality improves the overall impression of a hotel?

Factors

No. Of Respondents

Response in Percentage

To great extent

15

60%

To some extent

10

40%

Not at all

0

0%

The data in the above table makes clear that; fro 64% (15) of the total 25 respondents, they believe ‘to great extent' that corporate hospitality improves the overall impression of hotels; whereas some 40% (10) respondents believe this ‘to some extent'. These data summarise that on greater level, corporate hospitality improves the overall impression of hotels.

In the light of these revelations primary data was collected to determine as which type of corporate hospitality should be comparatively more prioritized by hotels. The data collected reveals that internal corporate hospitality should be comparatively more prioritised by hotels. For 64% (16) of the total 25 respondents, ‘internal corporate hospitality' should be comparatively more prioritise' and for some 36% (9) respondents, this is ‘external corporate hospitality' (see table and figure below).

7. Which type of corporate hospitality should be comparatively more prioritized by your hotel…?

Factors

No. Of Respondents

Response in Percentage

External corporate hospitality

9

36%

Internal corporate hospitality

16

64%

The data in the above table makes clear that; for 64% (16) of the total 25 respondents, ‘internal corporate hospitality' should be comparatively more prioritise' and for some 36% (9) respondents, this is ‘external corporate hospitality'. Overall, these data conclude that internal corporate hospitality should be comparatively more prioritised by hotels.
According to research literature , Rao (2004) suggests various functions of corporate hospitality in the forms of building brand image , facilitating sales , motivation of employees, building of trust and loyalty, improving any wrong impression about the products and services that the company is offering, sharing of information , building new contacts, and development of relationships.

In the light of these revelations primary data was collected to determine as whether the most important function of hotel's corporate hospitality domain is building broad image and development of relationships. The data collected reveals that the most important function of hotels corporate hospitality domain is building brand image and development of relationships. For 76% (19) of the total 25 respondents, they find that the most important function of hotels' corporate hospitality domain is building brand image and development of relationship; whereas some 24% (6) respondents do not find so (see table and figure below).

8. Do you find that the most important function of hotel's corporate hospitality domain is building brand image and development of relationships…?

Factors

No. Of Respondents

Response in Percentage

Yes

19

76%

No

6

24%

The data in the above table makes clear that; for 76% (19) of the total 25 respondents, they find that the most important function of hotels' corporate hospitality domain is building brand image and development of relationship; whereas some 24% (6) respondents do not find so. Overall, these data conclude that the most important function of hotels corporate hospitality domain is building brand image and development of relationships.

CHAPTER - 5

CONCLUSION AND RECOMMENDATION

5: CONCLUSION AND RECOMMENDATION

The objective of this research was to explore the pricing strategy in the hotel industry of the hotel product in this post recession period. Author conducted this research and found very good conclusion.

First of all author would like to focus or recall the aim and objectives or research questions of this study. Overall essence of the objectives or research questions were that what should be the pricing strategy for the hotel industry with special reference to the accommodation sector of the indusry.

Conclusion based on this study are:

Premium Pricing: use a high price where there is a uniqueness about the product or services. This approach is used where a substantial competitive advantage exists. Such high prices are charged for luxuries such as cruises Hotel rooms and flights.

Penetration Pricing:

The Price charged for products and services is set artificially low in order to gain market share. Once this is achieved the price is increased.

* One cannot come to a common and unique pricing strategy that will work properly and forever.

* Out of the all pricing strategy psychological strategy received very first position and choice of the most of the respondents or hoteliers. Actually psychological pricing strategy is such kind of strategy when organisations wants to take the advantage for emotional basis, put in differently, in this kind of pricing hotelier want buyer to be emotional rather rational. Here organisations will charge what they basically wanted to charge but pricing would be such that psychologically give the feeling to the guest that its being charged at low price.

* When it was asked whether one unique price will work or not then the response was that one pricing will not work forever. So there is preference for the mix of the pricing, most of the hotelier were agreed on proceeding with psychological pricing first then promotional and then value pricing strategy. Promotional pricing is very common- its simply buy one get one free kind of promotions. So hoteliers can provide additional facilities to the guest at the same price to attract more customer and just to make it psychological. After this there is a preference of value pricing. In value pricing strategy hotelier would follow giving services that will make customer feel its value for money. It means more additional services can be provided to the guest to make them happy and to retain the same.

* Towards future course of action from the view point of target customer and marketing tool most of the hoteliers have opted corporate hospitality would be the right way to generate more revenue for the hotel business, despite the pricing efforts. Corporate hospitality is all about providing excellent opportunity to somebody with some sort of reward. It provides an excellent opportunity to improve the overall impression or in other terms, creating good picture about one's company, products and services that they offer so as to remain in the good books of their desired audience who are linked to their success. Rao (2004) suggests various functions of corporate hospitality in the forms of building brand image , facilitating sales , motivation of employees, building of trust and loyalty, improving any wrong impression about the products and services that the company is offering, sharing of information , building new contacts, and development of relationships. In the light of these revelations primary data was collected to determine as whether the most important function of hotel's corporate hospitality domain is building broad image and development of relationships. The data collected reveals that the most important function of hotels corporate hospitality domain is building brand image and development of relationships.

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APPENDIX

QUESTIONNAIRE

1. What would be the choice of yours towards pricing policy of your product- accommodation sector? Please tick the options given below:

(A) Premium pricing ( )

(B) Penetration Pricing ( )

(C) Psychological Pricing ( )

(D) Promotional Pricing ( )

(E) Value Pricing ( )

2. Do you feel that any one strategy would be applicable for longer period?

(A) Yes ( )

(B) No ( )

3. If No, then what would be the next strategy? Please rank your choice in the order of 1 to 5, where 1 would be the first choice 5th would be the last.

(A) Premium pricing ( )

(B) Penetration Pricing ( )

(C) Psychological Pricing ( )

(D) Promotional Pricing ( )

(E) Value Pricing ( )

(F)Any other opinion? Please write below, in the given space-

…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

4. In this post recession period, keeping in mind the recession impact, besides pricing strategy do you believe corporate hospitality would be helpful in fighting with recession impact?

(A) Yes ( )

(B) No ( )

5. In your opinion, which is the most prevailing domain of corporate hospitality…?

Social and cultural domain ( )

Economic domain ( )

6. To what extent do you believe that corporate hospitality improves the overall impression of a hotel?

To great extent ( )

To some extent ( )

Not at all ( )

7. Which type of corporate hospitality should be comparatively more prioritized by your hotel…?

External corporate hospitality ( )

Internal corporate hospitality ( )

8. Do you find that the most important function of hotel's corporate hospitality domain is building broad image and development of relationships…?

Yes ( )

No ( )

SAMPLING FRAME

NAME OF THE FIVE STAR HOTELS OF DELHI (Universe Organizations)

LE MERIDIEAN

HOTEL SAMRAT

HOTEL ASHOKA

THE GRAND

RADDISSON

AMBASSADOR

4