rosewood branding to increase customer profitability and lifetime value l the sixers mm ui 2012
DESCRIPTION
Branding to Increase Customer Profitability and Lifetime Value l the SIXers MM UI 2012TRANSCRIPT
Branding to Increase Customer Profitability and Lifetime Value l the SIXers MM UI 2012
Rosewood Hotels & Resorts :
Dame Reiny
Frisca ListyaDewi Sagita
Ali Yudhi
Dewi Aryani
Rosewood Facts
ROSEWOOD HOTELS & RESORTS (ROSEWOOD) is a private hotel management company .• operated a “collection” of individually branded unique
hotels & resorts• Has global reputation with iconic luxury hotels
HISTORYRosewood Facts
1979• The Caroline
Rose Hunt Trust Estate
1984• Hotel Hana
Maui, Hawaii
Properties GrowthProperties Growth
Rosewood Facts
05
10152025
13
6 6
0 1 2
25
1210
85
4 1996
2003
Rosewood Facts
ROSEWOOD BRAND
“A Sense of Place”
Rosewood Facts
Rosewood Facts
Rosewood Theory
Building Brand Equity
Rosewood Theory
Aakers Brand Equity ModelAakers Brand Equity Model
Rosewood Theory
Calculating Customer Lifetime ValueCalculating Customer Lifetime ValueCustomer lifetime value (CLV) describes the net present value of the stream of future profits expected over the customer’s lifetime purchases
Rosewood Theory
Branding StrategyBranding Strategy
Rosewood Analysis
Pro’s and Con’sPro’s and Con’s
Rosewood Analysis
• Better CLTV• Collective Experience (duplicate
standard)• Consistent Service• Encourage guest to use more than
one properties• Better Brand Recognition• High customer loyalty (Rosewood
Junkies)
• Inconsistency in brand wide performance standard
• Increase Marketing Cost for re-branding• Resistant from owner, guest, manager• Guest feel alienate• Bad Reputation may impact others
Individual Branding
Revenue and Cost AnalysisRevenue and Cost AnalysisWithout Rosewood Branding
(2003)With Rosewood Corporate
Branding Total number of unique guests (a) 115,000.00 115,000.00Average daily spend (b) $750.00 $750.00Number of days average guest stays 2 2Average gross margin per room 32% 32%Average number of visits per year per guest 1.2 1.2
Average marketing expense per guest (system-wide) d
$130.00 $138.70
Average new guest acquisition expense (system-wide)
$150.00 $150.00
Total number of repeat guests (e) 19,169 24,919
Of which: Total number of multi-property stay guests
5,750 11,500
Number of Multiproperty Guest 5% 10%Average Guest Retention Rate (f) 16.67% 21.67%Average Gross Profit per Guest $576.00 $624.00
Rosewood Analysis
Total NPV of CLTV wTotal NPV of CLTV without ithout Corporate BrandCorporate Brand
Rosewood Analysis
Years 0 1 2 3 4 5 6
Gross profit per guest
609.50
646.07
684.83
725.92
769.48
815.65 Acquisition expense per new guest 115.00 Marketing expense per guest
132.60
135.25
137.96
140.72
143.53
146.40
Net Profit per Guest (115.00)
476.90
510.82
546.88
585.21
625.95
669.25
Retention factor 1.00
0.17
0.03
0.00
0.00
0.00
Discount factor 0.93
0.86
0.79
0.74
0.68
0.63
Net Present Value (NPV) (115.00)
442.56
73.17
12.09 2.00
0.33
0.205
415.19
Total NPV of CLTV withTotal NPV of CLTV with Corporate BrandCorporate Brand
Rosewood Analysis
Years 0 1 2 3 4 5 6
Gross profit per guest 661.44 701.13 743.19 787.79 835.05 885.16Acquisition expense per new guest 115 Marketing expense per guest 142.86 147.14 151.56 156.10 160.79 165.61
Net Profit per Guest (115.00) 518.58 553.98 591.64 631.68 674.27 719.55
Retention factor 1.00 0.22 0.05 0.01 0.00 0.00
Discount factor 0.93 0.86 0.79 0.74 0.68 0.63
Net Present Value (NPV) (115.00) 480.17 102.92 22.05 4.72 1.01 0.22
Total NPV 496.09
Rosewood Recommendation
• Adopt Corporate Branding• Strengthen Rosewood’s Brand
Equity
Rosewood Analysis
Rosewood Analysis
Rosewood Analysis
Rosewood Video
Thank YouThank You