What is Hilton's core business model? What is the definition of a customer in a franchising model?.
Over the years, Hilton has moved from a traditional hotel company to more of a consultant. This shift in business model was driven aggressively by owners, Blackstone Inc. Out of 4,080 Hilton properties, less than 4 percent are directly owned or leased by the company itself. Instead, the company will merely manage it for a share of the profits or it is completely operated by a franchisee. .
This model takes away real estate fluctuation concerns from the Hilton management. Problems such as property values and capital investment into building development and maintenance are no longer a concern. And keep the business growing despite global economic turmoil. Instead, the focus is on developing the brand quality of customer service. Franchise fees keep up the revenue and consultant privileges ensure that a keen eye can be kept on compliance to hotel standards. The downside of this arrangement is that during good times for business, the company will make less than the franchisee. This is not a major concern for the company at the moment. This model is popular among the hotel industry.
A customer in a franchise model represents a very important role. A customer forms the crux of the model with responsibility of customer being shared by both the property owner and the franchise. Building a customer base forms the base for building a brand image and is the main source of revenue. A customer needs to be taken care of by the franchise to ensure a comfortable experience by providing high quality service and the property owner by providing the best resources to achieve this quality service.
2. Does the combination of OnQ and CRM represent a VRIN resource for Hilton? Why/why not?.
The combination of OnQ and CRM does not represent a VRIN resource for Hilton. .
Valuable: Yes, the combination of OnQ and CRM represent a resource that is valuable as this framework is being used to leverage revenues, and this was showing positive effects on customer base and brand image.