Group 10: Batalon, Ballesteros, Kua, Sarayba

Case Digest: The Corporate Brand: Help or Hindrance?

I.
Problem Statement
Should a corporate brand be created for Lilypads chain of exclusive hotels or leave
them as having separate brands? Will the company be able to cross-sell?
II.

Case Analysis
A. SWOT Analysis of Lilypads Hotels

STRENGTHS
WEAKNESSES
Customer loyalty for specific
Brand recognition
locations
Low cross-property affiliation
Unique travel experience
awareness
Focuses on customization of
Inconsistent quality
its hotels based on local culture and
Ability to serve the existing
tastes
customers better
Diverse locational reach
Turnover of employees for the
past few months
Staffs arent providing the
guests with personalized care.
Layout of the rooms in their
hotels
OPPORTUNITIES
THREATS
Brand recognition
Limited growth
Increase in annual cross Competition
property usage
established brands
Attracting new customers
Offering junkies

with

more

B. Porters 5 Forces Model

a. Buyer Power
i.
Low buyer power: Demand for hotels at times when someone
needs a place to stay is very inelastic with respect to price, meaning that the
customers would not be able to successfully bargain with the hotels prices and
so the market as a whole wont be much able to dictate the price.
b. Supplier Power
i.
Medium supplier power. Since their hotels are located at various
locations, they are not subjected to the whims of a few suppliers, as they can
change suppliers if needed. Acknowledging that the locations are exotic, there
may be times though that only a few suppliers are available, and these are the
times they may increase prices.
c. Threat of new Entry

i.
Minimal threat of Entry: Entering the industry would need a lot of
capital and investments therefore it is hard to enter.
d. Threat of Substitute
i.
Medium threat of Substitutes: Demand for lodging is elastic as
more travellers could opt to stay in alternatives that offer lower accommodation
rates such as motels, hostels, or bed spacing. Unfamiliarity with the locations
may force customers to find hotels in these exotic environments, as these are
perceived to give satisfying quality, but may balk and find an alternative if prices
are too steep.
e. Competitive Rivalry
i.
High competitive rivalry: This threat poses a very huge challenge
for Lilypad as they encounter more established hotel companies within the
industry that is also luring the same set of customers to their hotels.
III.

Alternative Course of Action (ACA)

A. Do Nothing
Leaving the situation unchanged will obviously save Lilypad from undertaking a
costly initiative just to place its name front and center since it is uncertain if this
move will guarantee any success. However, the caveat to this is they will be
missing the opportunity to secure higher profits.

B. Be an umbrella company, with all hotels under the company, yet still retaining
each hotels unique personality
Retaining each chains uniqueness will enable it to increase Liliypads brand
perception due to the standardization of quality. However, Customers may have
a bad experience at a previous Lilypad-owned hotel and they could extend this
negative attribute to other chains as well. This can tarnish Lilypads brand and
image and dissuade other customers from staying in their hotels.
C. Consolidate hotels by adding by Lilypad at each name. (eg. Maritime Hotel by
Lilypad)
a. Advantages:
Standardizing its branding will enable Lilypad to employ a single marketing
strategy across all its hotel chains and better utilize its scale efficiencies of
supplies. Customers will become more familiar with its other chains, which could
encourage brand loyalty and increase customer-perceived value. As a result, L
Lilypad will be able to boost its cross-selling efforts.
b. Disadvantages:
Transforming the brand under a single identity would entail incurring into a high
cost of capital outlay to convey message and not properly highlighting the unique
characteristics of every hotel chain. Lilypad also stands to lose to its competitors
as they have been adopting this action for a very long time already and the
strategy would confuse and turn off its customer.

IV. Recommendation
The group recommends pursuing action C. - that each hotel chains should have the
label by Lilypad placed along with their names. The group seeks to strengthen the brand
name so as to attract more guests to try the different hotels of Lilypad.
V. Specific Plan of Action - Applying New Product Development Method (Maritime Hotel as the
experimental variable):
1. Idea Creation: The idea is to incorporate all hotels and resorts under Lilypad as
one in order to introduce to the market that the top hotels and resorts are owned and
managed by Lilypad.
a. Introduce other services that can be cross-sold to increase
revenue instead of offering services also offered by others.
b. Incorporate the Lilypad logo on each hotels signages, website,
linens, towels, soaps, bedsheets, etc.
c. Also, the greetings in answering phone calls and welcoming
guests should be uniform by adding the Lilypad tagline
2. Idea Screening: Bring the proposed plan to the executives/Board of Directors and
vote upon the succeeding action to take (taking into account errors they might take such
as a go-error or a drop-error). After the plan is approved, the marketing department will
be spearheading the whole project.
3. Concept Development and Testing: Within 3 months, constant meeting and
concept development with some testing of these concepts would happen inside and
outside the company.
4. Marketing Strategy Development: The company would revamp its training
programs to teach managers and employees The Lilypad way. The brand promise of a
one-of-a-kind travel experience in beautiful and unique locations will be consistent in all
of its hotels. With this strategy, the management wanted to help the customers connect
the dots (i.e. If a guest wants to stay in Maritime, there also other hotels under the same
management as Maritimes that provides the same service but in a different location.)
5. Business Analysis: Herewith, the decision will be if they would push through with
the strategy to make the business more productive.
6. Product Development: If the decision would be to continue the strategy, then
production of necessary products, training for significant services and the practice for
consistency shall begin.
7. Test Marketing: The testing execution would last for 6 months. After the said time,
there would be an evaluation within the marketing team. Also, different tests would be
happening during the time given.
8. Final Commercialization: Through the test run results, there would be a review of
the strategy if it increased the sales of Maritime (and Lilypad as a whole) and if it did, the
strategy will be implemented to the different hotels under Lilypad.
Other Services to offer:
The Lilypad would offer different services like massage centers, boutiques, restaurants,
courts, swimming pool, and so on. These services that Lilypad wanted to cross-sell depends on

the geographical location of the hotel. For example, in Maritime in New York, the management
can build pools and massage centers to offer relaxation for the guests.