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Marriott International SWOT & PESTLE Analysis

ID : 52472953| Sep 2020| 15 pages

COMPANY PROFILE -Marriott International

Business Sector :Hospitality

Operating Geography :United States, Global

About Marriott International :

Marriott International, Inc. is a leading global operator of hotels and related facilities. It was founded in 1927 by J. Willard and Alice Marriott. It’s headquartered in Bethesda, Maryland, US. The company has a 30 brand portfolio, which are all positioned in the luxury and mid-market price segments. Collectively Marriott's brand portfolio is segmented into two styles of hotels, viz., Classic and Distinctive further layered into three quality tiers: Luxury, Premium, and Select. Marriott’s overall lodging system encompassed 7003 properties and timeshare resorts with nearly 1,332,826 rooms in 131 countries and territories globally as of March 2019. Marriott had approximately 176,000 employees during the same period.
Marriott’s mission is “To enhance the lives of our customers by creating and enabling unsurpassed vacation and leisure experiences.” And its vision is “To become the premiere provider and facilitator of leisure & vacation experiences in the world.” Marriott’s core values are focused on putting people first, pursuing excellence, embracing change, working with Integrity, serving the world.
Marriott International's USP or Unique selling proposition sprawls in being the world's third-largest hotel chain with most compelling range of brands and properties globally.

Marriott International Revenue :


US$22,894 million (FY ended Dec 31st 2017) (year-on-year growth of 34.1%)
US$17,072 million (FY ended Dec 31st 2016

Competitive Analysis of Marriott International

SWOT
PESTLE
With numerous brand names under its umbrella, Marriott is a worldwide operator, franchisor, and licensor of the hotel, residential, and timeshare properties with distinct pricing to suit a broad array of patrons. As of 2019, Marriott International is the world's third-largest chain of hotels. With Marriott's Automatic Reservation System for Hotel Accommodations (MARSHA), Marriott became the world's first company to implement the concept of booking reservations online. Accordingly, the SWOT analysis of Marriott International manifests a discussion on the assets that generate surplus cash and are the greatest strengths, that the company enjoys as a competitive advantage over its rival(s) in the hospitality and tourism industry. The analysis highlights the opportunities in the external environment that can be incorporated to further strengthen the company. The SWOT report also confers intelligence on the internal weaknesses and external threats that the company confronts being in such a highly competitive environment.
Global market leadership, strong brands portfolio, strong employee base, sturdy brand recognition and recall, global presence, unique and innovative approach, constantly upgraded with technology, etc. are a few amongst several strengths of Marriott International. Marriott's key internal weakness are its aggressive expansion and establishment of too many hotels as this may lead to dilution of the company and maintaining the standards of service throughout could be challenging. The 2018 cyberattack on the Marriott hotel chain led to millions of customer’s private information being compromised, hence data breach is another significant weakness of Marriott. With an increase in disposable income, the number of travelers for both work and vacation purpose is constantly rising. Therefore, hotel chains can take full advantage of this opportunity and entice patrons with better packages, innovative customer services, attractive interiors, personalized attention and more. Competition threat to Marriott is increasing as the hotel and tourism industry is globally expanding and observing the penetration of many international brands into the industry.
The SWOT matrix of Marriott International is presented below in the SWOT Matrix followed by the detailed analysis:
Strengths
Weaknesses
1. Top position in competitive landscape
2. Ubiquitous luxury bands
3. M&A deals driving strategic advantages
4. Proactive and innovative
5. Strong pipeline to expand globally
1. Majorly reliant on North American market
2. Falls short of OTAs
3. Impact of family feud
Opportunities
Threats
1. Alibaba partnership to help expand in Chinse market
2. Increase in international travel
3. Opportunities to drive future rooms growth
1. Getting loyalty right
2. Increasing competition from new entrants
3. Stringent travel norms and slowing economic growth in United States
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Detailed SWOT Analysis of Marriott International

 

Strength

1.Top position in competitive landscape:Marriott International is the largest hotel company in the world in terms of value sales worldwide (Marriott has value sales close to USD50 billion). It has the largest number of rooms globally. The number of hotels that fall in the portfolio of upscale category and above are the also the highest for Marriott International. With an overall capacity of 1,160,000 rooms (Hilton is second with 792,000) it is best positioned to take advantage of the growing demand for luxury accommodations. It also has the best global market share of 11% in top 100 revpar market tracts (second is Hilton with 5.5%). Global fee for Marriott international is $2700 per room which is the most for any hotel. In terms of global market share of current system size and signed STR pipeline (rooms), it occupies a leading share in North America, Europe, Asia Pacific, Caribbean, Latin America, Middle East and Africa. Worldwide it has an 8.3% market share, ahead of Hilton having a 5.9% market share.

2.Ubiquitous luxury brands and presence across the world: Ritz Carlton and JW Marriott are strong luxury brands with a loyal customer base. Due to Starwood acquisition, popular luxury hotels such as W Hotels and St Regis are now also under Marriott International. It also has presence in 127 countries and 6500 properties under its umbrella. Acquisition of Starwood has also helped Marriott to tap into the Asia Pacific market (Starwood is strong in that region) which should remain a key target for expansion.

3.M&A deals driving strategic advantages: Starwood acquisition has provided Marriott International with opportunity to scale and reduce costs. The benefits of acquisition are in the form of cost synergies and penetration into the Chinese market. In terms of value sales worldwide, Marriott International is the largest company for the last 10 years. Acquisition of Starwood has strengthened Marriott’s position on the top spot considerably. 3 tier collection brand portfolio (of Starwood: ‘The Luxury collection’, Tribute Portfolio’ and ‘The Autograph Collection Hotels’) provides full range of options based on the market and product. Most of the Starwood brands have a strong pipeline and are scalable with low cost to build. All these hotels can leverage Marriott’s marketing channels and powerful distribution to reduce operating costs and increase revenue. Marriott’s acquisition over the years has helped the company gain traction in unpenetrated markets. Acquisition of AC hotels in March 2011 increased Marriott’s presence by 24% in Europe. Gaylord Hotels acquisition in October 2012 extended Marriott’s lead in the convention hotel segment. Proteas Hotels acquisition in April 2014 made Marriott the largest hotel company in Africa. Delta hotels, acquired in February 2015, made Marriott the largest full service lodging company in Canada.

4.Proactive and innovative: Marriott international is one of the top ranked most innovative companies as per Forbes and Fast Company. Its operational philosophy is centred on innovation. Most of its procedures and systems try to integrate commitment and innovation thus ensuring total value for money for the customer. Marriott’s spending on technological innovations such as IOT, testing Amazon Alexa in a number of properties to improve guest experience through voice, immediately grasping on opportunities in the segment of activity market; is a testimony to always staying proactive and innovative and trying to find new ways to increase customer experience and driving growth in the sector.

5.Strong pipeline to expand globally: Marriott International is reliant on the North American market and is looking to grow its international portfolio. As of Q3 2017 it had over 450,000 rooms in pipeline. In Europe from 40,000 rooms in 2010 it has 134,000 rooms in 2016 and it will debut its Delta hotels in Europe. By 2020, the company plans to double its portfolio in the Asia Pacific region. In April 2016, Marriott International opened its first Marriott hotel in Rwanda. Marriott is also focusing on introducing limited service brands in Mexico, Columbia and Brazil. Distribution is expected to increase by 75% in 2018 as compared to 2015 numbers

Weakness

This section is available only in the 'Complete Report' on purchase.

Opportunity

This section is available only in the 'Complete Report' on purchase.

Threat

This section is available only in the 'Complete Report' on purchase.

Major Competitors :

  • InterContinental Hotels Group (IHG)
  • Hilton Hotels and Resorts
  • Hyatt Hotels Corporation li>
  • Wyndham Worldwide Corporation
  • Accor Hotel

Major Brands :

  • JW Marriott
  • The Ritz-Carlton
  • St. Regis
  • Marriott Hotels
  • Le Méridien
  • Sheraton
  • Westin
  • Delta Hotels
  • Marriott Executive Apartments
  • Marriott Vacation Club
  • Courtyard
  • Residence Inn
  • Fairfield Inn & Suites
  • SpringHill Suites
  • Four Points
  • TownePlace Suites
  • Protea Hotels
  • Bvlgari Hotels

Recent Acquisition / Mergers / Alliance / Joint Ventures / Divestitures :

Open Table Preview
Name
Business Segment
Year
Type
Objective/Synergy Achieved
Avendra LLCHotels2017DivestmentThe proceeds from the divestiture would be used to develop other properties and system of hotels.
Starwood Hotels & Resorts WorldwideHotels 2016AcquisitionThe Starwood Combination will result in various benefits, including, among other things, operating efficiencies
Source: Company website and other reliable sources. The detailed table is available in the Complete Report.
SWOT & PESTLE (combined)
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Check Out Analysis of Other Relevant Companies

WHY BUY THIS REPORT?
TABLE OF CONTENTS
DELIVERY AND FORMAT
WHY CHOOSE US?

• Employing the fundamental evaluation models, SWOT and PESTLE analysis to assess the internal and external factors and their consequences on the company's micro and macro environment.
• The SWOT analysis is a structure, employed to evaluate Marriott's competitive stance by recognizing its internal strategic factors like strengths and weaknesses, external strategic factors like opportunities and threats.
• Cataloging Mariott’s innovative strategies that catapulted its position to a market leader in the industry and bestowed the company with an edge over its competitors.
• The PESTLE analysis of the Hospitality industry helps to recognize its current trends that impact Marriott’s business.
• The PESTLE / STEEPL / PEST analysis report is a structure to study the effects of external factors like political, economic, social, technological, legal and environmental, and their impression on the hospitality industry and in precise, Marriott International.
• A complete illustration of Marriott's business model and business diversification with further categorization and examination of key business segments and business case study
• Synopsis of the acquisitions, mergers, capital raising, equity transactions, alliances or partnership ventures that Marriott consented with deal valuations to achieve its milestones, business aims, and synergies.
• Comprehensive company analysis to compile information about company profile, value proposition, revenue jumps, business model, business plans and marketing strategy.
• Understanding of Mariott's USP or unique selling proposition, mission statement, and vision statement
• Identifying the core values, core competencies, key performance indicators and success factors that contribute to the fullness of the company
References used in Marriott International Analysis Report

1. Annual Report- https://www.annualreports.com/Company/marriott-international-inc

2. Annual report 2016-https://investor.shareholder.com/mar/marriottAR16/pdfs/Marriott_2016_Annual_Report.pdf

3. Marriot Website- Sustainabilty- https://serve360.marriott.com/sustain/

4. Hospitality Trends- https://www.ey.com/Publication/vwLUAssets/ey-hospitality-trends-2017/$FILE/ey-hospitality-trends-2017.pdf

5. Marriot Revenue- https://www.statista.com/statistics/266279/revenue-of-the-marriott-international-inc-hotel-chain/

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SWOT & PESTLE.com (2020). Marriott International SWOT & PESTLE Analysis - SWOT & PESTLE.com. [online] Available at: https://www.swotandpestle.com/marriott/ [Accessed 05 Dec, 2020].

In-text: (SWOT & PESTLE.com, 2020)

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Marriott SWOT and PESTLE analysis has been conducted by Vaneet Verma and reviewed by senior analysts from Barakaat Consulting.

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