Regal Carnation Hotel

In: Business and Management

Submitted By bbakesizzle
Words 2419
Pages 10
Problem and Key Issues

This case introduces the Regal Carnation Hotel in Guam. The perspective is from Steve McKenzie and how he details his experience with the Regal Carnation Hotel. In his depiction of the events that ensued, the fundamental issue consisted of the fact that the hotel followed a fundamentally unsound approach which is termed, “me too”. This decision by the management of the hotel proceeded to be a strong reason why he, as a customer, received poor service, and also why he was a victim of the hotel’s false representation. The “me too” approach coupled with poor timing on a global tourism scale in the territory of Guam, resulted in a pricing plan that did not match the value of the hotel. The hotel industry in Guam has significant statistical evidence, which will help build a more thorough analysis.
Key Issues
Guam had experienced a sharp growth to its tourism industry starting in the year 1967. Japanese tourists feed Guam’s consumer market volume, but overall Guam does not receive a large amount of tourists, specifically after the industry matured around 1997. After the maturation and coinciding decline of tourism in Guam, the first financial cutbacks made by management were with the staff. The staff is young and under motivated and not skilled enough to handle a diverse set of transactions. To combat losing potential customers once they see what the hotel really is, there is a non-refundable purchase for a stay. According to the manager, 80% of the booked reservations are done on the internet so to parley that into profit, the mystique of the hotel, and all encompassing “amenities” are well introduced and captured on the website to showcase the appeal of a wonderful place, but has a price that more closely matches the actual value (subpar) to woo prospective customers away from higher quality hotels in the area. Mckenzie and his wife made…...

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