Please conduct a SWOT analysis of the Sheraton (hotel) brand within the US
The Sheraton hotel brand, with the Four Points by Sheraton, stands in third place in the Marriott portfolio for largest chain with 330 hotels in the United States. A SWOT analysis of the Sheraton brand within the United States demonstrates that their business situation has been precarious, necessitating the current drive to divest the brand of under-performing locations while upgrading the rest. The communication strategy of the Sheraton promises to improve customer experiences through upgraded service delivery, a message powered by the immense budget allocation for Go Beyond marketing campaigns.
Below you will find the deep dive SWOT analysis of the Sheraton brand within the United States.
The Sheraton and the Four Points by Sheraton have 330 locations within the United States, making them the third largest chain owned by Marriott. Worldwide, they are the second largest independent-name among the Marriott brands with 449 locations, trailing the Marriott's 546. According to Travel Weekly, these locations recently received a $6 billion revitalization, with additional plans for another $8 billion in global expansion over the next 3 years.
Brand leadership point to the Sheraton's pioneering nature as one of its primary strengths, as well as passionate associates, and an 80-year commitment to customers and owners. This "go beyond" spirit has inspired a marketing campaign based on unconventional thinking, relying almost solely on digital marketing channels. Other strengths highlighted by the company are its status as the Official Hotels & Resorts of Major League Baseball and its membership in Starwood's Preffered Guest Group.
Another source indicates that the Sheraton brand has some definite strengths from a business standpoint as well. It has a strong free cash flow and a strong distribution network. The Sheraton has good returns on capital expenditure and a successful history of product development.
Compared to other high-end Marriott brands, the Sheraton has a history of low standards. Perception of the Sheraton has been impacted by a history of poor or inconsistent delivery. There is a wide gap between the best brand examples and the worst locations under the Sheraton brand name. The Sheraton also has a history of poor owner return on investment. Poor ROI simply serves to exacerbate the service delivery issue as the lack of return fails to inspire greater investment. According to an article on Hospitality Net, the brand's poor quality assurance, a result of inconsistent standards in both the physical product and the service, can be attributed to some degree on the lack of accountability that has been the norm in previous years.
An examination of the financial workings and business processes of the Sheraton displays the limited success demonstrated by the brand on anything but core business offerings. There has also been a failure in forecasting product demand, a high attrition rate in the work force, and poor execution of financial planning.
There are several strategies underway to improve the current circumstances within Sheraton hotels. A primary example of one of these opportunities concerns the plans to invest approximately $100 million in marketing for the hotel brand over the next 3 years. The Go Beyond marketing campaign utilizes such digital venues as YouTube to distribute a positive message about the hotel to American consumers, attempting to engage the important market of Millennials. The partnership with the MLB also serves to provide new opportunities to market the brand and communicate with new consumers.
Opportunities for the Sheraton brand also result from 6 behind-the-scenes initiatives by the Marriott Group in partnership with owners and franchisees. First, the quality gap has been identified as the first issue to be addressed, followed by new accountability for standards within Sheraton locations. Third, the Marriott Group intends to implement quality assurance processes, as well as new application of rigorous operational excellence. The last two initiatives are engagement of owners and hotel renovations.
The Marriott Group already considers the Sheraton brand a challenge. There was even an initial plan by the larger chain to drop the brand name entirely, taking over the physical locations with the Marriott brand, only purchasing the chain after the suggestion of extensive upgrades. The Marriott still may shrink the presence of the Sheraton brand within the United States, aiming to differentiate the Sheraton from other upscale brand options within their portfolio, like the Westin.
The Sheraton hotel also is threatened by the poor perception it has earned from the consumer market. This negative viewpoint is particularly pronounced with North American markets like the United States. There are even worries that that negative perception could result in lawsuits due to the service levels.
As the third largest brand within the Marriott Group portfolio in the United States, the Sheraton has several weaknesses, but these are being addressed with the immense resources of the controlling power. The focus on eliminating the poor performing locations and upgrading others has been combined with immense resources placed in marketing efforts. This powers the communication strategy of distributing a new, positive message focused on elevated service delivery and upgraded locations.