How Hotels can Benefit from Mobile Marketing? Thesis

Background

Almost everybody in this modern world now carries a mobile phone, thus, presenting a great opportunity for effective marketing by any business. With the advent of the latest mobile phones and wireless technologies, it is evident that there is an immense scope for profitability in the hotel industry. In simple terms this can be related to finding a room at the nearest restaurant.

It will not come as a surprise that the hospitality industry has taken over to the advantages of mobile marketing. There are an increasing numbers of mobile phone subscriptions in the UK than there are humans living in the country, with a great percentage of adult people using more than one mobile connection.

Of these, at a quarter fractions utilize their mobile phones for messages and calls — taking pictures, listening to music, browsing the internet. It is also suggested that within almost 3 years, most of the consumers of internet technology will be utilizing and surfing the internet applications on their mobile sets (De Kerchove, 2002 ).

We reside in a society that is proud to be a part of everything big, fast, and strong. Today, a person can buy a car that is self driven, watch video streams from around the world through the internet or select own TV program at his / her own convenient time and enjoy.

For marketing managers, the omnipresence of ever more personalized digital media means that consumers are better informed, more demanding, and more focused on individual needs than ever before. In trying to reach this “segment of one,” marketers find that traditional metrics like gross reach pale in comparison with such informed measures as digital net reach and cost per transaction (Katsakura & Nishiyama, 2007).

Mobile channels, in particular, allow game-changing marketing which plays an important role and assist in addressing the individual customer needs and interests. And, by doing so, they also maximize net reach impact.

Many hoteliers are confused over the same question, ‘Does my hotel actually require mobile marketing?’

They are curious about the reasons as to what would change if they take up mobile marketing, how their hotel and customers will advantage from mobile marketing, what level of time and quantity of financial obligation is concerned, and what kind of mobile strategy would be most beneficial for them and bring the most attractive return on asset (Mackenzie & Lutz, 1989).

This research will bring imminence to the questions posed below for the purpose of this research, and give you an idea of the mobile marketing nowadays and a lot of chances that mobile technology presents for the success of hotel industry.

Recognition of the convenience and comfort that mobile devices present has been a norm for the industry and consumers now. The hurdles and obstacles which hinder the consumer from experiencing the dynamism of mobile technology are now eradicated.

BlackBerry and iPhone which demonstrate a number of features such as touch screens, crisp and bright pictures have turned out to be the most attractive aspect of mobile technology (Sangwon, Sylvia, Chan-Olmsted, & Ho, 2008). Facilities include GPS navigation, music players and recorders, multimedia features and cameras.

Connectivity at a high speed due to broadband and 3G technology is commonly available in the markets. Flat rates and then low roaming charges are another attraction for mobile users. Since, cost for multimedia services was always high, therefore, limited costs and cheaper offers have resulted in a wide acceptance of the mobile technology.

A study shows that wireless products, services and networks have become an essential part of the Canadians’ daily lives. Mobile subscribers have considerably increased beyond expectations in 2009 and every member of any community or household now has access to a mobile phone.

For many people, the mobile phone is replacing the traditional land line, eased by the fact that wireless carriers offer coverage to the entire human interface (Sangwon, Sylvia, Chan-Olmsted, & Ho, 2008).

According to the Interactive Advertising Bureau, mobile advertising revenue is also growing, while subscriber growth is set to continue as new carriers enter the market, saturation will eventually occur, positioning innovation as a key cornerstone for the future growth. As devices improve, a greater percentage of people are upgrading to media services when they get a new handset.

Although all phones marketed in 2008 were smart phones (a mobile phone with advanced, PC-like capabilities, like the iPhone or BlackBerry), this is relatively low compared to the worldwide figures.

However, the penetration of smart phones is expected to increase, with current shipment numbers growing at twice the rate of the rest of the world (Sangwon, Sylvia, Chan-Olmsted, & Ho, 2008). Barriers to entry like data plan and device costs are constantly being lowered and smart phone use is rapidly becoming more prevalent.

The extensive digital wireless networks available to UK allow users to broaden and customize their mobile experience. Devices have moved beyond simple voice calls and text messages and can now provide access to e-mail and instant messaging, corporate networks and the Internet.

Mobile device has turned out to be a social driver making it easy to access different regions and cultures which demonstrate mobile phones to be broadly accepted (Phelps, LEWIS, Mobillo, Obilio, & Raman, 2004). This customer experience has become a flaringly attractive of market development of mobile technology.

Finally, mobile phones which are heavily branded are a potentially rich tool for marketers in order to generate added value and customer retention. Furthermore, with the eradication of financial and economic barrier, this current business model presenting the new opportunities of mobile marketing are very transparent and should not be overlooked (Katsakura & Nishiyama, 2007).

This research will analyze various online sources as well as offline journals, books and periodicals in order draw relevance and identify the gap between the current and past studies in the context of Mobile Marketing as an effective tool.

Some of the concepts highlighted in the reviewed literature include:

• How does Mobile Marketing Fit in the Marketing Mix? : Similar to the internet marketing, mobile technology contributes equally to the marketing mix (Sangwon, Sylvia, Chan-Olmsted, & Ho, 2008).
• Mobile phone consumer market bypasses the internet market: Mobile technology have attained larger adoption as compared to the adoption of internet technology –which makes it an overwhelming and potentially strong marketing tool (Lueg, Ponder, Beatty, & Capella, 2006).
• Faster connectivity: 3G access and unlimited faster rates of connectivity has turned out to be a pretense of mobile marketing technology to be accepted as the best medium of marketing (Sangwon, Sylvia, Chan-Olmsted, & Ho, 2008).
• Advertising through mobile phones is being clinched by customary marketers of various brands and not just marketers of applications related to cell phones (Lueg, Ponder, Beatty, & Capella, 2006).
• Mobile marketing is being used for both responsiveness and direct reaction: Advertising firms are utilizing the means not only for direct reaction, but particularly in the case of amusement, individual care products, and products related to well being of an individual, as a regulator of awareness in a manner to request highly-desirable viewers strong to arrive through other mediums (De Kerchove, 2002 ).
• High performance: At this phase in the development of mobile marketing, its comparatively low disorder and low charges make it very much attractive for marketers (Katsakura & Nishiyama, 2007).
• “Mobility” offers maximum marketing prospective: Mobile, the only medium where the publicity travels and characteristically stays with the consumer, offers an exceptional opportunity for geographically targeted and promotional and marketing strategy (Lueg, Ponder, Beatty, & Capella, 2006).

Some benefits of the mobile technology are that it widens the current communication medium and enables one to connect with their guests and customers in a more intellectual manner.

Mobile is an explicit and outstanding facility and an application through mobile is any possible alternative for hotels and makes it probable for them to correspond with their guests earlier, during and after their visit to the hotel. Traditional marketing techniques do not make this possible.

The proposed research will conclude the expanding concern presented by previous scholars in marketing through mobile and wireless technologies, but it will also differentiate between the diverse kinds of communications prevailing in the hotel industry.

The outcome will show that the dissimilarity among the kinds of association is important, and they increase panoramic modelers to study the consequences of this difference between mobile marketing and other forms of marketing on the sales and ability to retain a competitive advantage amongst hotels.

In its potential to shape and monetize the customer relationship, there are five ways in which mobile outperforms all other marketing channels and platforms. These help companies to understand different dimensions of customer relationship that could be served via mobile marketing.

These include “customer access, customer insight, customer dialogue, customer emotions, and customer transactions” (Friedrich, Gröne, Hölbling, & Peterson, 2008). These are evaluated in this study to build a case for the implementation of mobile marketing in the hotel industry.

Aim of the project

This study aims to formulate its research in order to find out the opportunities available to the UK hotels for growth and development with respect to Mobile Marketing. It presents challenges, which are prevalent for hotels to flourish in the United Kingdom specifically.

The research questions are, therefore, posed at the effectiveness of mobile marketing in the hotel industry and what challenges and opportunities it presents to the hospitality industry in UK awakening to the call of mobile technology. By large, mobile phones have managed to serve as a tool of communication for hotel managements. It is because mobile phones enable hotel managers to stay in contact with their customers.

In this way they can enhance their quality and generate more revenue. The biggest advantage can be its use for increasing customer loyalty.

It is quite evident that hotels have come across the significance of mobile phone softwares for its effective stargtic use but there is still a need of proper set of requirement to design such a mobile solution. Hotel management have now understood it completely that mobile phones could be a helpful source for marketing.

The purpose of this research is to identify some of the key determinants of mobile marketing captivating strategies for hotels. Some widely reported determinants of success in the mobile marketing are the financial determinants, customer service quality, traveler’s management, updated and extended performance by staying updated with latest offers and discounts.

However, there can be potentially many determinants of competitive advantage as the magnitude underlying judgments are comprehensive rather than precise. For example, there have been many explorations in the field of consumer perceptions towards the mobile marketing usage which has played a major role in evaluating a framework for hotels in the current context.

The findings of the proposed research will be drawn from different sources to ensure that different aspects of mobile marketing are covered extensively and conclusions can be made regarding the implementation of mobile marketing in the hotel industry.

However, it is for the understanding of the users of this report that it is not possible to include every aspect of mobile marketing in this report and therefore, the outcome of the study may not be considered as exhaustive as it is wide research topic and it is not possible to include everything in this report within the given time frame.

Objective of this Research

The main objective of this research is to evaluate the effective strategies and competitive advantages of using mobile marketing for the benefit of the UK hotels.

For achieving this objective, the performance of UK hotels would be reviewed and evaluated along with a detailed analysis of various mobile marketing strategies and methods that hoteliers can implement to gain competitive edge in the market. Furthermore, the advantages expected from the use of this strategy will be highlighted as to be drawn from the study devised for the proposed research.

Hypothesis

The proposed research opts to investigate different aspects of mobile marketing and its use in the hotel industry to form a definite opinion regarding the following research hypothesis that is descriptive in nature.

H: Mobile Marketing is an effective marketing strategy that can be used by hotels to achieve higher sales and attain competitive advantage

The research hypothesis set out for the proposed study will be accepted if the evidence collected is sufficiently supportive of the positive implications of mobile marketing for hotels operating in UK otherwise it will be rejected.

Research Question

The study will address the following research questions which will help in formalizing the structure of the report and also achieve the objective of the research set out in the previous section.

1. What are the implications of mobile marketing for the hotel industry?
2. In what ways, mobile marketing benefit hotels?
3. What are the constraints for carrying out a successful mobile marketing strategy by hotels?
4. How can customers benefit for the implementation of mobile marketing by hotels?
5. Is there a common model that could help hotels achieve greater results from the implementation of mobile marketing?
6. What could be the potential future opportunities in mobile marketing for hotels?

This research questions will form basis of the analysis in the findings section of the report. However, it is also set out that these research questions are not exhaustive and any other information that may be deemed useful for serving the research objective will be part hereof.

Research Methodology

This chapter of the report will mainly discuss the research methodology which is the basic part of doing a research and it is organized in such a way that the objectives of the research which are discussed in the research are achieved. This chapter further explains that how researcher applies various techniques and method to carry out the research.

Research methodology is defined as the search conducted for knowledge through organized method including study, analysis, and comparison and experimenting (Kumar, 2008). This chapter further explains the purposes of research methodology, which is to conclude the primary and secondary data resources so that its main elements of research are easy to understand.

Qualitative Research Methodology

Qualitative research method is the most widely used and preferred research methodology among different methodologies being used by researchers. This type of research methodology is appointed to evaluate cultural as well as lifestyle aspects of society (Ethridge, 2004).

Qualitative is a systematic approach towards evaluation of data and then providing a conclusion on the basis of systematic measurement. The use of qualitative method of research has been noted more in psychological and behavioral phenomenon. Different situations can easily be studied and understood with the help of qualitative research methodology (Blessing, 2009).

Deductive Vs Inductive Research

Deductive approach is a synthesis of performing reasoning and addressing key subjects in a research. The synthesis of addressing subjects in deductive approach takes place from very important subjects to general topics. The deductive approach of research is also called as top-down approach (Blessing, 2009). The most important pointer about deductive approach is that it produces conclusion on the basis of logic.

Inductive approach addresses important subjects at the first place followed by general topics to discuss through supposition and process of generalization. Inductive approach completely differs from deductive approach as it is an opposite approach to that of deductive approach. This approach is regarded as bottom-top approach (Ethridge, 2004).

Data Collection Techniques

It is important for researchers and investigators to collect the most accurate and relevant data so that better result could be yielded. Data collection is itself a very important technique that must be applied because there are many mediums and sources for data collection.

The major type of source for collecting data is published source. Published sources include books, journal articles, reports etc. Other methods for collecting data are questionnaire and interviews. All such types of sources are further divided into primary and secondary sources.

Primary data

Data from primary sources are collected to address targeted objective of the research. Primary data helps researchers in collecting data which is not available in the previous researches. Primary data is collected directly from people. Authentic data collection is possible by primary data as it is based upon actual statements published by professionals, authorities, agencies etc.

Primary data could also be in the form of self-opinion by a professional who is concerned with a higher authority or profession. Most notable examples of primary data are interviews, journal articles, surveys etc (Goddard & Melville, Research Methodology: An Introduction, 2004). Researchers prefer and appreciate primary sources because they are not in any way interpreted.

Sample questionnaires are also a helpful tool for the measurement of findings. Questionnaires are especially designed for the purpose of getting the desired results depending upon the target of the research. Questionnaires contain different types of questions such as demographic, descriptive questions etc.

Secondary data

Secondary data is collected by researchers and investigators to evaluate the cases with the present interpretations. Best examples of secondary data are scholarly articles such as books, journal articles, online websites etc. These sources are very helpful for the research purpose because they help in presenting researches that have already been published in the area of research.

Secondary sources are able to provide credibility to the content of research. The evidences are provided on the basis of case studies or review of interviews and statements. At times, it is also noted that the researches that are used for the purpose of investigation are not relevant but one subject of another may be relevant to the research and can be use to back up the research (Blessing, 2009).

Many researchers have noted that often it is complicated to find relevant secondary sources to back up research content with evidences. Secondary sources are then divided into further categories (Bergh & Ketchen, 2009). Amonng different types of secondary sources, internal sources are those which we can get within organizations. Second type of secondary source is that which is available in databases or in libraraies.

Adopted Research Methodology

The research methodology prescribed for the proposed study is based on the phenomenological paradigm. This involves a qualitative approach to the research that includes investigation of different research elements related to the use of mobile marketing and strategies that hotels can implement for ensuring the maximum output from its use.

Since, the research hypothesis set out of the research is set out to determine whether mobile marketing can be beneficial for the hotel industry or not, therefore, it is clearly understood that the objective of the research can be well served, if the approach to the present research is descriptive in nature.

Therefore, it is set out that the findings of the research cannot be quantified in anyway and their analysis would result in descriptive conclusions to the study. The present study opts to investigate strategies that are already in place by hotels operating in the UK hotel industry and obtain their views on mobile marketing that may have helped them to achieve greater results and achieve competitive advantage.

For this purpose, two major hotels are approached for acquiring their views and experiences of mobile marketing and assessment of the impact of mobile marketing strategies on their business.

From this, it could be suggested that the approach of generalization of results is inductive where a small group of hotels are inquired regarding the use of mobile marketing and the findings from the study are generalized for a larger group of hotels operating in the same hotel industry.

The study, therefore, makes use of both primary and secondary data collection techniques that are prescribed in the following sections. The outcome of the study is presentation of a case for the use of mobile marketing by hotels and recommendations related to the successful implementation of mobile marketing strategies by hotels.

Primary Data Collection

The primary data collection technique implemented for the present study is the survey questionnaire. The reasons for choosing survey questionnaire are the possibilities of inquiring large number of questions and matter of ease for respondents to complete the survey questionnaire in their own time.

Arranging telephonic interview was also considered but it was difficult as approval from the hotels management was less likely for it. The details of the questionnaire specifically designed and implemented for this study and targeted respondents are provided in the following sections.

Sampling

In order to draw findings supportive of the use of mobile marketing by hotels, the study targets those hotels operating in UK which have already embark upon the use of mobile marketing for their businesses and managing customer relationships. After review of the information available regarding such hotels two major hotels are selected including Malmaison and InterContinental Hotels Group.

A written request will be sent to the corporate office of these hotels after seeking approval from the University for carrying out the survey. These hotels will be requested to allow representatives from their management team to complete the questionnaire. From this, it could be suggested that the sample size for the study is quite small and this could affect the outcome of the study as underlined in the limitations of this methodology.

Survey Questionnaire

The underlying objective of the survey questionnaire is to obtain views of the hotels operating in UK, which have already implemented some form of mobile marketing. The questionnaires are structured with the help of different types of questions such as closed ended questions and open ended questions (Blessing, 2009).

Closed ended questions assist in obtaining responses that are well directed and serve specific purposes of the survey questionnaire; whereas, open ended questions gives opportunity to respondents to provide detailed replies to provide in-depth insight into the research topic.

The survey questionnaire initiates with demographic questions that collect background information of the respondents including names, age, gender, position in the company, and number of experiences.

Next set of questions is based on Likert Scale, which allows different statements to be grouped under five areas of investigation which are already highlighted in the previous section of this report namely customer access, customer insight, customer dialogue, customer emotions, and customer transactions (Friedrich, Gröne, Hölbling, & Peterson, 2008).

Each category contains three statements which have a positive tone. Responses to each statement allow the study to gather overall opinion of respondents regarding their understanding and experiences with the use of mobile marketing.

As per the Likert Scale Model, respondents will provide a choice to select their responses from a ranking i.e. 1 to 5. Ranking ‘1’ corresponds to ‘Strongly Disagree’. ‘2’ corresponds to ‘Somewhat Disagree’, ‘3’ corresponds to ‘Neither Agree or Disagre’. ‘4’ corresponds to ‘Somewhat Agree’ and ‘5’ corresponds to ‘Strongly Agree’.

Finally, the questionnaire also contains three open ended questions, which attempt to obtain responses regarding the difficulties which hotels under review faced before and after implementation of the mobile marketing strategies, comparison between their strategies and the ones adopted by their competitors, and possible recommendations for hotels to achieve greater results from mobile marketing.

Basis for Analysis

The responses to be collected from the survey questionnaire will be summarized using SPSS 17^®. SPSS 17^® is statistical software that will be used for providing descriptive analysis of the responses collected for statements based on Likert Scale Model. In this way the graphs and tables will completely complement the findings researched through the survey questionnaire.

The basis for analysis is the conceptual framework for understanding the customer relationship management via implementation of mobile marketing strategies. Studies by Sangwon, Sylvia, Chan-Olmsted, & Ho (2008), Katsakura & Nishiyama (2007), Lueg, Ponder, Beatty, & Capella (2006), (De Kerchove (2002 ) and Friedrich, Gröne, Hölbling, & Peterson (2008) form basis for analysis of findings from the survey questionnaire.

The analysis will form descriptive discussion of various areas of investigation and conclusions will be presented regarding the acceptance or rejection of the research hypothesis set out for this study.

Limitations of Research Methodology

Although the research methodology adopted for the present study is considered most appropriate one however, there are certain limitations which need to be highlighted for better understanding of the study results. These are described in the following.

1. The qualitative approach to the study makes the analysis part of the report to be of descriptive nature which is very much dependent on the researcher’s own ability and knowledge of the research topic and capability to use SPSS17^® and interpret findings.
2. The use of survey questionnaire does not allow the researcher to record non-verbal expressions which may be useful for the research. This has been overcome to some extent by including open ended questions.
3. The sample size of respondents is very small which implies that the responses collected could be biased or they may not be reflective enough for drawing definite conclusions from the study. This limitation has been addressed by requesting management of two hotels under review to assign individuals who have the experience and high level of knowledge related to mobile marketing.
4. Selected research methodology is also dependent upon two factors – time and cost which have restricted the extent of the research.

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