SWOT Case Study - Sandals

Company History

Sandals (Beaches) is a Caribbean Based Resort Hotel Chain, that was only recently established, but has proved to be highly successful, based on their innovative marketing concepts. This SWOT analysis is about Sandals.

In Montego Bay, Jamaica, in 1981, Gordon "Butch" Stewart, took notice of an old hotel sitting on Jamaica's largest private white sand beach, bought it, fixed it up and opened the hotel doors for business. With no prior experience, the investor envisioned a marketing plan for the resort to cater to couples only. Sandals Montego Bay became the first all-inclusive vacation concept, and by year-end of 1988, Sandals refined and perfected concepts, such as, swim-up pool bars, royal treatment with private beaches, breakfast in bed, and beachfront gourmet meals.

In 2004, the resort hit great heights with the creation of the company's ultimate all-inclusive butler service. With thriving expansions, Sandals currently holds locations in Jamaica, St. Lucia, Antigua, and the Bahamas, totaling 12 resorts. A long way from one, run down hotel on a private sandy beach! Today, the resort offers luxury package vacations, fine dining, night entertainment, scuba diving and water sports, golf and land sports, spas, and wedding packages.

Sandals' is committed to the resort's mission of ".attaching a premium to human resources and being among the most environmentally responsible and community friendly groups in the hospitality industry" (Sandals Resorts, 2007). Sandals resorts continue to penetrate the market with their couples' only concept, and have expanded this concept with accommodations for families through other beach resorts, branded Beaches.

Strengths

They created the idea of a couples only resort by introducing the Sandals resort; they also opened Beaches, a family luxury resort; Royal Plantation, three exclusive luxury oriented resorts with butler service and private airplanes; and the Grand Pineapple, a value resort for families.

All Sandals resorts are Green Globe Certified; it means that the staff is continually trained by local government run environmental organizations, they monitor and conserve all water use on property, they use times on all electrical equipment such as; Jacuzzi blowers, steam rooms at the Spa, outdoor lighting for walkways, refrigeration equipment in the kitchens, etc., recycling food, and office paper, reducing the use of all hazardous chemicals and Inviting local craft vendors to the hotel at least once per week to display and sell their craft items.

Winner of thousands of awards, including:

• Six time winner of the Gold Travel Life Award by Virgin Holidays.
• Nine time winner of the Baxter Travel Media award for Favorite Resort.
• 2008 Thomas Cook Award for Best Hotel Chain, and Best Wedding and Honeymoon Hotel.
• TripAdvisor awarded them the 2007 and 2008 World's Most Romantic All-Inclusive Resort.
• Travel + Leisure Magazine awarded them one of the top 25 hotels in the Caribbean for 2002, 2006 and 2008.
• Condé Nast Magazine Readers Choice Poll awarded them one of the top 25 Caribbean Resorts for 2006, 2007; and the top 15 Caribbean Resorts and Spas for 2000, 2004 and 2005.
• They have made the Condé Nast Magazine Gold List every year from 2000-2007.
• In 2007, they were given a World Savers Award by Condé Nast Magazine for their Adopt-A-School program.
• In 2006 they won second place in the Caribbean Travel and Life Magazine Reader's Choice poll for Best All-Inclusive Resort.
• In 2005 Modern Bride Magazine voted them the Favorite All-Inclusive Resort and in 2008 the Best All-Inclusive Resort chain.
• American Express gave them the Caribbean Environmental Award for Green Hotel of the year, 2003, 2004, 2006 and 2007.
• They earned the Travel Weekly Magellan Award for Overall Eco-Friendly Resort in 2008.
• They were voted Travel Weekly America and UK Readers Choice for Best All-Inclusive Resort, six years in a row.
• TravelAge Editor's Pick Award for Best Caribbean Resort in 2006, 2007 and 2008.
• World Travel Magazine award for Caribbean's Leading Resort Hotel Brand winner 14 years in a row; Best All-Inclusive Company winner 12 years in a row, World's Most Romantic Resort winner 11 years in a row.
• 2006 British Airways Best Independent Hotel Group.
• 2007 British Travel Awards for Best All-Inclusive Resort-13th year in a row-and the Consumer Favorite All-Inclusive Resort.
• Porthole Cruise Magazine Editor-in-Chief Award for Best All-Inclusive Resort, 2005-2007.
• Selling Long-Haul UK Travel Award for Best All-Inclusive Resort, and Best Hotel in the Caribbean in 2003.

Sandals and Beaches resorts offer an innovative concept in their all-inclusive environments, contrived to give vacationers completely worry-free accommodations. Guests do not have to pay for food, activities, babysitting, or entertainment while at their resorts. This allows guests to relax and more effectively utilize their vacation time.

They employ guest coordinators, trained to be experts in human relations, to make guests feel at home, coordinating the guest activities and making sure that everything works the way it should. They practice TQM throughout all levels of staff.

In the couples only market (that they created) they cater to different markets by offering three different levels of suites: the basic all-inclusive suites, the crystal suites that have their own private pool and the millionaire suites that are separate villas with butler service.

Weaknesses

They need to communicate the resort's view on environmental issues. For instance, Sandal's beach resort received a Green Globe Certification for commitment to natural resources, but they don't advertise or communicate it! In this economic downturn, Americans want to feel good about spending their money in socially responsible ways and the Green Globe Certification is highly prestigious.

They spent a huge amount of capital setting up a new resort in Barbados, only to have it sit there, unoccupied. The government of Barbados does not allow their beaches to be blocked off with fences, and Sandals requires that their guests be kept separate from other people to prevent crime and interlopers. They have been at odds about this issue since 2001 and their fully completed resort there has yet to see its first guest.

As with all tourist destinations, they are dependent on a healthy economy in countries whose citizens have more discretionary income to spend, and vacation regularly. The American trend toward "staycations" will cause their revenue to decrease.

They need to better position themselves against competition, other luxury resorts, Breezes All-Inclusive Resorts and other popular destinations for honeymoons and families.

Opportunities

Opening new resorts in Belize, or Hawaii, and some non beach areas such as Alaska and Colorado; they could also open resorts in other International settings such as China, Japan, Taiwan, France, Spain, Italy, Greece, Australia, Mexico and Brazil.

Promote their resorts at all Bridal and Child/Baby Expos in major cities, in order to reach the largest numbers of their target market. They can make use of high definition, interactive sales pitches that will allow honeymooners and families to book their vacations on the spot. Attending the National Wedding Show in London every February.

Creating a joint venture with David's Bridal, creating a presence on all of the major wedding planning websites, Parents' Magazine and on Nickelodeon.

During the economic downturn, they need to play up the "all-inclusive" angle of their resorts: creating a marketing campaign that emphasizes the money saving aspects of their vacation destinations, and the fact that guests don't need to worry about extra expenses.

July 2009 Sandals announced that they will partner up with Martha Stewart to Launch Martha Stewart Weddings Program in the Caribbean beginning in 2010. Guests will be able to book a Martha Stewart Wedding at any of the 12 Sandals Resorts or four Beaches Family Resorts. In addition, they will introduce Martha Stewart Crafts classes for adults at Sandals Resorts and craft camps for families at Beaches Resorts in 2010. The Futures Company (formerly Yankelovich), said that destination weddings are on the upswing with 31% of brides ages 21-30 planning to have a destination wedding; previous studies indicated that destination weddings represented 10% to 20% of all weddings.

Threats

One threat that cannot be controlled is the weather. Hurricanes are bad for business all over the Caribbean; however, they can offer guarantees so their guests will feel more secure when booking a vacation.

There are several ethical arenas that need to be understood when dealing with the tourism industry. If any of these becomes a problem or causes bad PR it can affect the company and eventually their profit margin.

• Crime rates typically increase with the growth and urbanization of an area and growth of mass tourism is often accompanied by increased crime. The presence of a large number of tourists with a lot of money to spend, and often carrying valuables such as cameras and jewelry, increases the attraction for criminals and brings with it activities like robbery and drug dealing.
• Tourism can also drive the development of gambling, which may cause negative changes in social behavior.
• Many jobs in the tourism sector have working and employment conditions that leave much to be desired: long hours, unstable employment, low pay, little training and poor chances for qualification. In addition, recent developments in the travel and tourism trade (liberalization, competition, concentration, drop in travel fares, growth of subcontracting) and introduction of new technologies seem to reinforce the trend towards more precarious, flexible employment conditions. For many such jobs young children are recruited, as they are cheap and flexible employees.
• The commercial sexual exploitation of children and young women has paralleled the growth of tourism in many parts of the world. Though tourism is not the cause of sexual exploitation, it provides easy access to it. Tourism also brings consumerism to many parts of the world previously denied access to luxury commodities and services. The lure of this easy money has caused many young people, including children, to trade their bodies in exchange for T-shirts, personal stereos, bikes and even air tickets out of the country.

by Mkt Teachers