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Andrew Morgan
BUSN 301
April 30, 2015
Rosewood
Opportunity Statement
The Rosewood Hotel company is seeking an opportunity to implement a new "big brand"
strategy that will lead to better brand recognition for their luxury hotels.
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Overview for Recommended Actions
Rosewood has two primary options:
1. To implement the new branding strategy.
2. Remain a conglomerate of diverse luxury hotels.
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Plan of Action
Rosewood hotels, established in 1979, sees an opportunity to increase brand recognition
by making the Rosewood logo the primary brand. Currently, Rosewood serves as a conglomerate
that operates a number of luxury hotels but lets the brand of the individual hotel take precedent
over the corporate Rosewood logo. The new CEO and the Vice President of Marketing think it is
time to establish Rosewood as a true corporate brand.
Option 1 is for the Rosewood company to place the corporate name of Rosewood on all
of its hotel names and merchandise. Advantages are the increase in brand recognition and hopes
of creating a loyal customer base. Rosewood currently does not experience high brand
recognition with guests. Applying the new broadening strategy will make the corporation more
recognizable by the guests. Rosewood believes that with a corporate brand, customers will be
able to identify Rosewood properties and will remain devoted to the brand. The corporate
branding would create a larger return rate to the other properties. Disadvantages consist of the
loss of competitive advantage for Rosewood properties. Rosewood currently consists of a
number of diverse properties that are unique because of their particular differences. Ideally, they
would like to find the balance between implementing a big brand and individuality. However, it
is too difficult to obtain one without sacrificing too much of the other. They will sacrifice the
image of luxury, for the image of a big brand hotel chain.
Option 2 is the recommended action. Rosewood hotels can stay the way they are
currently operating. This means allowing the hotels to maintain their individuality. Advantages
are clear, that they will not have to change anything about the company, saving money and time.
They will also preserve the distinctiveness that allows them to have a sustainable source of
competitive advantage. It is shown that individual properties yield a higher growth rate
(Appendix A). Each hotel under Rosewood represents their key philosophy in customer service,
“A Sense of Place.” The company does not have to overhaul the image to make it fit for each of
the locations. The hotels are able to maintain luxury and provide a local styled experience for the
guests. Disadvantages are the lack of brand recognition. Although, this issue might cause some
instability for Rosewood in the market, it still does not out weigh the concern for a source of
competitive advantage. There is a one million dollar cost per year for implementing the corporate
branding. The cost for the big branding strategy is more than the potential benefits.