Branding to Increase Customer Profitability and Lifetime Value

Company Profile

ROSEWOOD HOTELS AND RESORTS

A private hotel

management company

with iconic luxury

Hotels.

12 hotels

1513 rooms

BRAND Model

• Iconic Luxury Hotels and resort.• For those who have deep pockets and

prefer lavish lifestyle.Demographic Segmentation

• Each property Tailored to deliver enriching experience of the location, culture and history.

• Brand Mantra “A Sense of Place”

Brand Positioning

Individualistic Brand Positioning

CUSTOMER

Report on ROSEWOOD BRAND

EMPLOYEESTRAVEL

AGENTS

Guests

“ Rosewood is a collection of

brands it is not a brand”

“ Known by the individual properties”

“ A collection of individualistic

properties; Rosewood as a

brand is a dilemma”

“ It’s a secret club”

“I don’t know

Rosewood “

“I had no idea that Litte Dix and the mansion were

connected to rosewood”

5-10%• Mutiproperty

cross-selling Rates

40%• Single

property Repeat Guests

Customer

Reservation

System

Report on ROSEWOOD BRAND

Management

To bring all the

individual brands

under one

umbrella

To increase

multiproperty

guests stay from

5% to 10%

To build Rosewood

Hotels as a brand

Individual Branding

Corporate Branding

Low brand Recognition

Brand Wide usage by guest untapped

Marketing expense

Promoting Corporate Brand

Which Strategy to choose ?

Corporate branding Analysis

Multiproperty Guest Stay was

anticipated to Double from 5% to 10%.

Overall total no. of unique guests

was kept constant at 115,000.

The average visit rate per year

increases to 1.3.

Marketing investment of 1 million per year.

With Corporate Branding

Without Corporate branding(2003)

With corporate branding (2003)

Total No. of Unique guests 115,000 115,000

Average Daily spend $750 $750

Number of days average guest stays 2 2

Average gross margin per room 32% 32%

Average number of visits per year per guest 1.2 1.3

Average marketing expense per guest (systemwide) $130 $138.70

Average new guest acquisition expense (systemwide) $150 $150

Total number of repeat guests 19,169 24919

Of which: Total number of multiproperty stay guests 5,750 11,500

Average Guest Retention Rate 16.67% 21.67 %

Average Gross Profit per Guest $576 $624

Profit and Revenue

Years 0 1 2 3 4 5 6

Gross Profit Per Guest

609.50 646.07 684.83 725.92 769.48 815.65

Acquisition expense per new guest

Marketing expense per guest

132.60 135.25 137.96 140.72 143.53 146.40

Net Profit per Guest

476.90 510.82 546.88 585.21 625.95 669.25

Retention factor 1.00 0.22 0.05 0.01 0.00 0.00

Discount factor 0.93 0.86 0.79 0.74 0.68 0.63

Net Present Value (NPV)

441.58 94.90 20.38 4.38 0.94 0.20

Without Corporate BRANDING

Years 0 1 2 3 4 5 6

Gross Profit Per Guest

661.44 701.13 743.19 787.19 835.05 885.16

Acquisition expense per new guest

Marketing expense per guest

142.86 147.14 151.56 156.10 160.79 165.61

Net Profit per Guest

518.58 553.98 591.64 631.68 674.27 719.55

Retention factor 1.00 0.22 0.05 0.01 0.00 0.00

Discount factor 0.93 0.86 0.79 0.74 0.68 0.63

Net Present Value (NPV)

480.17 102.92 22.05 4.72 1.01 0.22

With Corporate BRANDING

Follow corporate branding Model

Create Brand Equity

Create Brand awareness by Marketing communication

Resonance

SailenceThe depth and breadth of the brand awareness

Performance

Judgements

Imagery

Feelings

How well the company meets customers functional needs

Extrinsic properties of the products and services.

Focus on customers opinions and evaluations

Emotional response with respect to the brand

Brand Resonance Model

Marketing Communication

Brand Awareness through events and experiences

Destination

Wedding

Corporate

Meetings

Cultural

Events

Brand Loyalty

Loyalty Cards

Special Yearly events for

Loyal customers.

Service Quality

Printed Goodies to Loyal

Members

Brand Repositioning with the corporate branding model

Creating brand awareness through various communication channels, events and experiences

Increasing Brand Equity through loyalty programs

Created by Rachit Tandon,

RIL, During a marketing

Internship under Prof. Sameer

Mathur, IIM Lucknow.