Answer to Question #219238 in Management for Nkule

Question

Explain the various business level strategies for city lodge hotel group

Answer 1

Companies in various modes highly use business-level strategies to achieve competitive advantage. They are highly effective in increasing the profit and growth of the company.

The city lodge group has five brands that it uses different to achieve competitive advantage.

1) Fairview- The Fairview hotel uses a Cost leadership business strategy. It keeps its rooms and conference rooms low compared to competitor hotels to increase the customer base. An increase in customer base and reduction in prices of Fairview hotel does not mean low profit; it formulates various plans and policies to get the raw materials and other inputs at a lower cost.

2) Courtyard Hotel- Courtyard hotel uses differentiation strategy. It has established itself in such a way that it stands different from other hotels. It has its own unique and distinctive elements, and for this, it may charge a higher price from the customers. It had to incur extra costs to make the hotel stand different from others, and the customer also has faith and a brand image of the hotel in mind, which makes it difficult to switch to other hotels.

3) City Lodge Hotel- City Lodge uses a focused cost leadership strategy. It has a niche market for itself to which it serves at cost-effective prices. They focus only on their membership customers to which they offer good services at an affordable price combo. The member customers can get to experience various services by opting for a membership plan.

4) Town Lodge- Town Lodge uses a focused differentiation strategy to achieve a competitive advantage.

They provide service to a niche group of customers, and they offer what nobody else is offering in the market. They are offering unique services like a live casino which is only in the market. Only limited customers will be available who can afford the services of the hotel.

5) Road Lodge- Road Lodge hotel uses an integrated cost leadership/ differentiation strategy. It focuses on both cost-effectiveness and unique service delivery. It is tough to achieve a competitive advantage by using this strategy. The hotel uses the latest technology and infrastructure to stand out in the market and makes various plans and policies to achieve cost-effectiveness. The hotel has invested hugely in a single go, but its returns will be coming over a long period of time. It has to maintain its uniqueness over a long period of time and also offer services at affordable prices to achieve a competitive advantage.