Blue Ocean Strategy in the Hotel Sector

Bachelor Thesis from the year 2013 in the subject Tourism - Hotel Industry / Catering, grade: 1,7, International Business School Nürnberg, course: Hotelmanagement, language: English, abstract: The hospitality industry experiences abundant growth rates, although it is one of the worlds toughest markets. Therefore, entrepreneurs need to aim for differentiation in order to gain an uncontested market position. Blue Oceans are more than a natural wonder and a loophole for mass-market participants: It is an efficient strategy management tool that focuses on finding innovative business concepts and thus the key to success for adaptive companies. In contrast to saturated Red Oceans, Blue Oceans feature value innovation through an adjusted offering with costs benefits. Similar to the Darwins "Survival of the Fittest"-approach the Blue Ocean Strategy depends on customizing and enhancing an already existing concept with innovative features. In such highly competitive markets, monopolists - those who are able to find a market niche - exhibit the best chances for economic success. W Hotels and MotelOne are two well-established paradigms for innovativeness in the hospitality industry. While W Hotels succeeded in adopting an exclusive lifestyle hotel destination with a focus on design, fashion and music, MotelOne concentrated on a premium low-cost oriented design-approach. Together both parties reinvented their segment through implementing trailblazing new concepts combined with the value- adding design factor. Moreover, Blue Oceans need to eliminate dispensable options, as W is less formal and more liberal than all its competitors, whereas MotelOne discarded unprofitable amenities like telephones, minibars or room service. The economic surplus derives from wider target groups as well as higher profit margins, which is why trendsetting Blue Oceans are classified as a future-proof and promising corporate path.