The main factors that have contributed to Banyan Tree’s success
Success of the Banyan Tree was facilitated by a number of factors. To begin with, the company achieved its global exposure through having good pubic relations and effective global marketing programs (Wirtz, 2009). In relation to this, due to its marketing management, the company carried out development management with the help of which its new products were developed.
This was important since needs and requirements of clients kept on changing from time to time, thus causing innovations in technology as well. For instance, it introduced new contemporary brands that were intended to attract more customers to it. This was done as well in order to venture into unexploited market and to address the constantly changing needs of its customers.
For that case, Gerardo and Wong (2008) outlined advantages of global marketing which included provision of many investment opportunities for the business entity. This is so because in the global marketing, there are always some areas or regions that are not exploited by other competitors, and this provides an additional niche where the Banyan Tree explored the expansion of its customer base.
Nonetheless, the Banyan Tree used international marketing agencies in performing its business activities. This propelled it into an international player in the hotel industry, hence, gaining attention of the global market. Moreover, it is relatively important to acknowledge that the Banyan Tree later started using travel magazines that were high end in advertising. They used this to showcase accolades and awards that it had won. This put it as a front runner in the hotel industry, hence, forming a basis for its success.
Moreover, there was diversification with its products. In relation to this, the Banyan Tree was one of the first entities to venture to fill the gaps that had been created by the giant chains, such as Hilton. For that case, the Banyan Tree was able to provide an intimate and private accommodation at a much lower price as compared to its core competitors (Wirtz, 2009). This was one of the key factors that helped the Banyan Tree promote its business since few players could provide such kind of services at such a cost in their operating environment.
In addition, it must be acknowledged that the culture of the Banyan Tree played a major role in its success. For instance, the way its hotels were designed meant to give their customers a sense of place which in turn enhanced the destinations heritage. This is important in any hotel business since the business can only maintain its position in the market if its clients have a sense of belonging which makes them keep coming for more and more.
Besides, the Banyan Tree’s case study provides several guiding principles that were used in putting marketing into action (Wirtz, 2009). These principles have been a cornerstone of rapid development and improvement of services by the company. This is so since they are the best way for any venture to adopt in order to forge forward. For that case, from this case study, the following factors were imperative in the success of the Banyan Tree’s venture.
Contribution to societal needs. According to Lovelock, Wirtz and Chew (2009), any business setup needs to contribute to the societal wellbeing; this can be viewed as a core principle of marketing its services and products. It is, therefore, important to note that apart from concentrating on business activities that were geared towards optimizing profit, it was necessary for the Banyan Tree to involve in the social wellbeing of its clients.
This was well demonstrated in the Banyan Tree’s case when the companyt became more concerned with natural environment. The care and concern in the natural environment were for the social wellbeing of its clients rather than for profit gaining. This promoted other services of the company as it also tried to gain confidence of its users in the firm.
Furthermore, success in business calls for the market analysis also formed a major factor for success (Kushal & Ahuja, 2010). This can be done through several ways but from the Banyan Tree case study, it became possible to carry out analysis of its operating environment, in order to come up with new frontier that served as its venture niche. As a result of this, it was able to spread geographically both within and outside Asia. The market analysis enabled it to make informed decisions.
Evaluation of the Banyan Tree’s brand positioning and communications strategies
Branding in business and effective communication are essential aspects in determining business success. This is so since it builds business value.
However, for any business entity to attain this, it requires exceptional creativity, insights, in-depth analysis and good communication strategy. However, despite brands being unique, there are some common factors that determine their success. These include organization support and commitment, appeal to emotion and reasons and proper management that inspires every stakeholder in the organization.
Nonetheless, as it is postulated in the case study, coming up with a strong brand is the surest way of maintaining a sustainable continuous competitiveness in any operating environment. For that matter, the owner of the Banyan Tree recognized the importance of having a strong brand positioning, in order to have a competitive advantage over other players in the environment.
For that matter, evaluation of the Banyan Tree brand’s positioning indicates that it was based on aspects that were supposed to give its clients the necessary knowledge of the services offered. To begin with, the resorts of the Banyan Tree are comprised of the villas that were designed to provide the utmost privacy. That provided ultimate services that were completely unique in nature, hence serving as a brand positioning in the operating environment.
Moreover, the Banyan Tree adopted a sense of place as its way of promoting its brand in the market. Since it was concerned with the provision of the hotel services, it was imperative for the organization to create a sense of place to its clients so that they could be more comfortable to the environment, thus developing goodwill. This helped it stamp its presence in the operating environment (Hanna, 2010).
Importantly, the Banyan Tree embraced values of caring for the human and natural environment. This was important for the brand positioning of the company since it was able to revitalize the local communities as they developed respect and pride to the organization.
Moreover, this positioning approach helped develop values among customers and employees that they could easily identify with. For that case, the Banyan Tree was able to affirm its brand through environment preservation which all stakeholders in the operating environment were willing to support. Consequently, this helped the company in positioning itself in the market.
For that case, it is relatively evident that the Banyan Tree applied various positioning and communication strategies in their business. However, one of the positioning strategies was benefit driven because the organization used its brand as a way of responding to their clients in form of caring for their social and environments issues through environmental conservation. The company accomplished this by involving both its staff and clients.
Nonetheless, it is also important to acknowledge that the Banyan Tree used positioning and communication strategy based on the problem and its solution. In respect to this, it used environmental issues operating environment, hence developing a way of solving this problem. For that matter, it decided to position itself in the market by providing solutions to the environmental issues by involving its stakeholders in caring for the environment (Halachmi, & Bouckaert, 2010).
Maintenance of the unique positioning in an increasingly overcrowded resorts market of the Banyan Tree
Unique positioning is very important in any business venture. In relation to this, it is important for the Banyan Tree to create its unique positioning strategy even in an increasingly overcrowded resort market. This is ascribed to the advantage of having differentiation in the market.
According to Hoskisson (2008), it was believed that without its own positioning strategy, it is not possible to differentiate the entity from other competitors in the operating environment. Therefore, it becomes difficult for the prospective customers to appreciate and understand the value of the organization.
Whether the brand portfolio of the Banyan Tree fits as a family or not
“
The Banyan Tree established itself as a major player in the luxury resorts business in Asia and other regions in the world. Nonetheless, after its enter into the market, it introduced other brands. For instance, there was the Angsana brand which was meant to meet the demand of the Asian hotel operators.
Nonetheless, it is affirmed from the case study that the positioning of these new brands did not fit that of the Banyan Tree. Clearly, this indicated that the brand portfolio of the Banyan Tree did not seem to be one family. For that case, the Banyan Tree decided to have a different brand for each venture.
In addition, the Banyan Tree also introduced the Angsana in order to keep on the top of the cultural tourism and soft adventure market which also had its own identity and there were other firms which priced its services much lower than those of the Banyan Tree. For that matter, it was also not able to meet the strategy of the Banyan Tree.
This was the case to the new ventures of the Banyan Tree which included the product portfolio of beach resorts and city hotels, spas, galleries and museum shops; however, they could not be united under the brand of the Banyan Tree as a family.
Effect of corporate social responsibility on brand equity
Corporate social responsibility (CSR) is considered to be organization’s activities and status with respect to its societal and stakeholders’ obligations. Organization’s CSR have positive effects on both its business activities and the entire society.
According to Halachmi and Bouckaert (2010), it was opined that corporate social responsibility helps build a landing space in the minds of the targeted clients. On the other hand, Gerardo and Wong (2008) believed that in addition to this, it also promotes awareness of the brand equity amongst its customers. Moreover, it also helps create a positive image of the brand in the minds of its potential clients.
Moreover, it was acknowledged by Fredrickson (1990) that the current globalization has prompted stiff competition in any industry, hence corporate social responsibility has turned to be the platform for selling their brands. Therefore, catering for the social needs of the society has now become the slogan for the organizations to cultivate and nurture their brand equity.
As postulated by Drummond, John, and Ruth (2008), developing a strong brand is one of the most promising ways of increasing financial value of any organization. For that case, proper corporate social responsibility improves corporate market share and increases its profit margins due to growing customer base. On the other hand, it was acknowledged by Chelladurai and Madella (2006) that survival of business in the modern days is dependent on the organization’s responsibility to the society.
Nonetheless, it was opined by Cameron and Green (2004) that consumers in the market like switching to brands concerned with good cause in their society. Therefore, by doing this, an organization is able to bring on board its customers to participate in their corporate social responsibility activities, hence cultivating goodwill in the market.
Consequently, it was mentioned by Burn, Marshall and Barnett (2002) that there is a close relationship between corporate social responsibility and brand equity. This is ascribed to familiarity created among consumers. For that matter, it was believed by Audreys and Judah (2003) that benefits derived from the corporate social responsibility are used majorly to build reputation which in turn results in differentiation amongst competing organizations.
Potential problems to be expected in bringing the Banyan Tree to America, Europe and the Middle East and the ways to address them
Expansion of the Banyan Tree to America, Europe and the Middle East is expected to strain the company financially. It was acknowledged by Young and Burgess (2010) that transferring an organization to the new operating environment requires strong financial capital base in order to recruit staff, equipment and other materials.
For that case, the Banyan Tree is likely to face financial constraints that may in turn affect its service delivery and even threaten to influence its brand equity negatively. Therefore, it is relatively important that management of the Banyan Tree should consider sourcing for funds in order to cushion for unexpected shocks. This can be done by ensuring that the company’s borrowing facility is sufficient and that its cash flow system is effective (Bruijn, Heuvelhoof & Veld, 2010).
In addition, the company is likely to suffer from an inadequate expertise. This is a major problem since skills gap is likely to be experienced which may have negative impacts on the quality of service provided by the company.
However, this can be solved through recognizing these gaps early enough in order to recruit the right people (Shewell, 2008). Moreover, it is also important that proper training and assessment program should be instituted, in order to build a strong skill base before expanding operations into the new ventures.
Moreover, facilities gap is also likely to be another major problem in the expansion performed by the Banyan Tree. For that matter, in order to solve this problem, it is relatively important to acquire additional facilities and materials in order to be able to cater for the increased demands of these additional facilities (Botha, Strydom & Brink, 2007). This will help fill this niche since the available ones are not strained in the expansion process.
Conclusion
To wind up, it is imperatively important to acknowledge that there are several factors that determine success of a business entity. However, corporate social responsibility can be identified as a key factor that determines the growth of brand equity in the market. For that reason, it is important to prioritize the business activities of any company.
On the other hand, it must be noted that in the expansion process of any business organization, there are some inhibiting factors which may be a big problem to the expansion process. Nonetheless, it is important to identify these problems as soon as possible in order to find their solutions.
References
Audreys, W & Judah, R 2003, Culture Change in Long Term Care. Haworth Social Work Practice Press, Binghamton.
Botha, J, Strydom, J & Brink, A 2007, Introduction to Marketing. Juta and Co Ltd, Cape Town.
Bruijn, H, Heuvelhoof, E & Veld, R 2010, Process Management. Springer, Netherlands.
Burn, J, Marshall, P & Barnett, M 2002, E-Business for Virtual Organizations. Butterworth-Heinemann, Jordan.
Cameron, E & Green, M 2004, Making Sense of Change Management. Kogan Page Ltd, Great Britain.
Chelladurai, P & Madella, A 2006, Human Resource Management in Olympic Sport Organization. Human Kinetics, New York.
Drummond, G, John, E & Ruth, A 2008, Strategic Marketing: Planning and Control. Elsevier Ltd, Burlington.
Fredrickson, M 1990, Perspectives on Strategic Management. Harper & Row Publishers, New York.
Gerardo, R & Wong, Y 2008, Global Strategic Management. ME Sharpe. Inc, New York.
Halachmi, A & Bouckaert, G 2010, Public Productivity Through Quality and Strategic Management. IOS Press, Amsterdam.
Hanna, N 2010, Enabling Enterprise Transformation: Business and Grassroots Innovation for the Knowledge Economy. Springer Science, New York.
Hoskisson, E 2008, Competing for Advantage. Thomson South-Western, Australia.
Kushal, J,& Ahuja, S 2010, Business Communication. Rahul Jain, New Delhi.
Lovelock, C, Wirtz, J & Chew, P 2009, “Essentials of Services Marketing,” Promoting services and educating customers, vol. 12 no. 2, pp 168-188.
Shewell, C 2008, Voice Work: Art and Science in Changing Voices. England, Wisey-Blackwell.
Wirtz, J 2009, “Banyan Tree – Developing a Powerful Service Brand (case study),” Lovelock, vol. 34, no. 2, pp. 438-445.
Young, L & Burgess, B 2010, Technology as a Service: Proven techniques that creates value. United Kingdom, John Wiley & Sons Ltd.