L&w Construction Ltd Marketing Plan
EXECUTIVE SUMMARY
L&W Construction Ltd. is a home-based construction & investment company founded in 2013. It invested the first property, an old unique castle style house in 2014. Considering the unique appearance, influenced by own travel experience, the owners decided to do life style business, a holiday rental for travelers.
After two years’ operation, the rental is very popular and sales revenue increased each year. The holiday rental business is very seasonal in Auckland, it is almost filled to its capacity in hottest season, there are even bookings for special days two years in advance. However, in off season, the business is affected by the tourism, it is very low occupancy.
The goal of the following plan is to develop a sustainable strategy plan to fulfill the short-term marketing goals, increasing the lodging ratio in the off season. Meanwhile, ramp up investment, enlarge the business and grow into a chain luxury holiday rental business covering more cites in New Zealand in three years and maintain the business success in the long run.
SITUATION ANALYSIS
To better understand the business environment and provide the basis for developing strategic alternatives. We try to identify the specific characteristics of the customers, company, context, collaborators and competitors via internal and external factor analysis.
Internal analysis
- Company profile
L&W Ltd. is a small company. The rental property belongs to its investment business. The owners and employees are between 35-45. They have years of multinational company management experience. But none of them has hotel industry working experience. They pursue high quality, sustainable life style, caring about work and life balance, and prefer long term investment. Their firm’s goal is to develop high-end chain BNB for the international travelers who has similar preference.
- Product profile
The luxury BNB is a unique castle style building. It has private and spacious yard, modern kitchen facilities, with appealing features such as swimming pool, hot tub and pool table. It located in East Auckland, near the seaside and has convenient transport. The holiday rental with these features deliver desirable benefits, unique and value experience for travelers.
- Customer profile
The customer is international travelers who travel with families or group of friends for leisure purpose, especially those who have similar travel preference with the BNB owners. Aged 30s to 50s.They are usually professionals with good education and pay more attention to spending on travel and experience, whose trend toward specific, value and less price sensitive.
At present, the majority guests come from abroad, only a few Kiwi guests from outside of Auckland. In 2014, when the rental first opened, nearly 60% international guests came from Australia, followed by European and North American guests accounted for about 20%. Asian guests are concentrated in India, Korean, Malaysia, Singapore and China, altogether contributed 20%.
After upgrading the price and quality. Chinese guests increased from 5% to 30%. Australia guests decreased to 35%. In the first four months of 2017, Chinese bookings have already reached 30%.
- Collaborators
From the operating costs, we can see in the initial period, the majority cost is from renovation and facilities updated. As the business going, the maintain fee, the daily maintain of the swimming pool and spa tub, cleaning fee are the main cost. Using part time cleaners and charge the cleaning fee from guests additionally will save the cost. A fixed term and regularly maintain with the collaborated the builders and pool solution company is effective way to lower cost and avoid emergency repair.
Presently, the main sales channel is travel website. Primary listing and booking is on Airbnb. Airbnb is world number one BNB website now, it serves one million guests every month. It has over 3,000,000 lodging listings in more than 191 countries. (Airbnb, 2017) The secondary listing website is Booking and Trip advisor.
- Current Performance and marketing Objectives
The property was extremely attractive and made satisfying profit in the first year. The sales revenue in 2015 and 2016 got 32% and 24% increase. The occupancy rate is 58% and 54% in 2015 and 2106 respectively, due to house maintain in 2016, the rental closed for 40 days. Fewer open days, higher rental fee, so the sales revenue still got increase as well.
2016 New Zealand's Hotel accommodation industry average occupation rate was 65.2%, 2017 is expected to reach 71%. (New Zealand Tourism Report Q2, 2017. P16). The luxury BNB average occupancy rate in 2016 is 62%. The occupancy rate in off season was 45%.
The offseason is from June to September, July and August are the summer vacation in China. Many parents will travel with children during the long summer holidays.
External analysis
- Political Forces.
New Zealand enjoys a high reputation of pure natural beauty, stable and equal political atmosphere. Which has created a better business environment for the hotel and tourism industry. A growing number of international travelers choose NZ as one of the preferred destinations. more than half of the international visitors are on vacation purpose. (MBIE, 2016)