Commercial short holiday breaks in Scotland : an analysis of market structure, supplier strategies and performance
Hospitality and tourism environments are widely regarded as complex and dynamic in nature. This combined with the need for commercial organisations to improve performance places considerable emphasis on the need for approaches to understanding market and organisation dynamics. This research proposes an approach to analysing and understanding the dimensions of markets and the interface with organisations to allow optimum performance. It uses the commercial short holiday break (CSHB) market in Scotland as a contextual base, and reflects an industrial economics approach which encompasses identification of market structure, competitive strategies and company performance, to explore activity in the area and propose approaches to analysing dynamic and complex markets. Commercial short holiday breaks (CSHB) are widely recognised as a growth market for hotels. What is often not documented is that such growth is at the expense of other market sectors, fuelling mature market conditions and requiring increasingly sophisticated marketing strategies to gain and sustain market share and thus improve performance. To date, little has been published on how hotel companies compete in CSHB markets or what performance differences result as a consequence of different strategies and market conditions. Therefore through an extensive literature review (of the limited data available) and the construction of a database of hotel groups containing the 30 largest hotel groups operating in Scotland, an indication of the market structure was formed. To confirm initial findings and provide more detailed data on strategies adopted in the market, structured telephone interviews were conducted with key suppliers. The interviews revealed strategic groups with two main categories of strategy : predator strategies for gaining market share and secondly defender strategies for protecting market share. To establish how strategy affects corporate performance, further interviews were conducted at the corporate level and then in recognition of the multi-site nature of hotel operations, interviews were also conducted at unit level for six key short break providing companies. The findings indicate that there are bilateral "associations" between the market structure, the strategy adopted and the resulting performance. Having constructed a model based upon the findings, it appears to be the case that results hold true between both the corporate (industry) relationships and the unit (market) level relationships, making the model a significant contribution to knowledge.