International Operations Plan - Marriott Ukraine

Kate Radishevska

Selling Comfort Around the Globe

Highlights

• Opportunity• Ukrainian Economy• Investment Risk• Competition• Target Market• Market Strategy• Sales Strategy• Final Suggestions

Opportunity

• EURO Cup 2012 will be hosted in the 4 major cities of Ukraine: Donetsk, Kharkiv, Lviv and Kiev

• Ukraine will need: – Additional hotel infrastructure– To accommodate thousands of soccer fans

traveling for the Euro Cup in 2012– 30-40% growth in the hotel and other tourist

services

Ukraine• Second largest country in

Eastern Europe• Free Market Economy• 2008 GDP Growth: 8.45%• 2008 Inflation Rate: 12.8%• 2008 Unemployment: 2.3%• 2009 Population:

45,700,000• Literacy: 99.4%

Investment Risks

Risks Effects SolutionGovernment Instability Business and Political

EnvironmentUkraine Foreign Investment Laws

Policy Instability Business Flow UK Foreign Investment Laws

Corruption Overall Business International Corruption Laws

Competition Marketing Strategy Competition Law in UK

Tax Rates (No taxes on Real Estate, Insurance is Optional)

High Tax Rates for International Firms

Tax Deduction Laws for Investors in the Tourism Industry

Competition

• Current Ukraine Hotels: • 1300 Hotels • 3200 Resorts• 4000 Private Hotels

• International Standards: • Parking• Concierge and Room Services etc.

• Stable Tourism Growth, 23M in 2008• Hotel Supply is less then 5%, demand is up to 20% a year

and growing• Average Occupancy Level is 60-70%

Target Market

• 45M Ukrainians• 23M Annual Foreign Travelers– Purpose: leisure or business objectives– Optimistic: frequent travelers and members– Sports fans: soccer tournaments

Marketing Strategy

•Newspapers•Flyers•Billboard•Magazines

• Yandex.ru• Ukr.net• Marriott.com

•NRCU•NRCU International•“Promin”•Popular Local stations

• Inter• “1+1”

TV Radio

LocalMedia

Internet

Sales Strategy

City In Season Off Season

Kiev $281 $250

Donetsk $152 $120

Lviv $120 $100

Kharkiv $97 $75

• Market Penetration Strategy is an Aggressive Low Price

• Middle Class Consumers• Competitive Pricing on All

Amenities• Sophisticated Image • Think Long Term, but Focus

on the Present• Middle Class Affordable

Proposed Room Prices

Final Recommendations

• Concentrate on One City at a Time

• Joint Corporation with Ukrainian firm or individual

• Renovate Existing Building• Choose a Central Urban

Location• Maintain the Marriott

Standard• Offer a Variety of Amenities• On-Site Parking• 3-4 Star Hotels

Questions