BUDGET HOTEL : A MARKETING STRATEGY

Abstract

The increasing strong demand for small, quality hotels that give personalized service at budget rates has made the budget hotel market a lucrative business. With less-labour intensive operations and lower start-up and furnishing costs, budget hotels is fast gaining popularity. This has led to the increase in the supply of budget hotels. The budget room inventory will increase to about 5 percent of the total supply of hotel rooms in Singapore in 1996. This dissertation began by showing the reasons for proposing a guideline for budget hotel operators in formulating marketing strategy for their budget hotels. One of the main reason is the growing gap between the new budget hotel establishments and the existing ones that have been operating for many years in terms of provision of quality rooms and standard of services. The trend of new-style budget establishments is geared towards quality but affordable accommodations, offering comfort with specialised services. A case study proposing the marketing strategy for Penta Hotel was carried out aimed at providing a background undemanding of the emerging new-style budget hotel and a guideline for formulating marketing strategy. Armed with these knowledge, both existing and potential budget hotel operators can thus decide where they want to position themselves in this market in order to carve out a niche of their own.