Marketing Analysis Punta Cana Resort and Club Essay

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Marketing Analysis

Punta Cana Resort and Club in Dominican Republic

Importance of Tourism in the Area

On the mention of tourism and tourist destinations, one is always tempted to consider the Caribbean region. On of the most lucrative and attractive places in this region is the Dominican Republic. This is a country that relies on tourism to help propel its economy since it is the largest foreign money earner and many other internal industries rely on it to continue in their operations. The proximity of the Dominican Republic to the North American market makes it sustainable for many industries within the country apart from just the tourism sector. The thriving tourism sector is so significant to the nation that there is an estimated 800 miles of coast line dedicated to the tourism industry. Apart from the large dedicated shore line, the warm climate and the white sand beaches keeps attracting tourists to the region from allover the world.

The tourism industry is very central in the economy of the country, for instance the number of tourists that visited the country in 2005 was over 3.6 million and the tourism sector accounted for 7% of the GDP as well as 35% of al the exports that came from the country (Embassy of the Dominican Republic in the U.S.A., 2012). With the knowledge of the centrality of the tourism in the republic, the government has strived to uphold the sector by promoting several destinations there in like the San Pedro and La Romana, Punta Cana, Bavaro and Macao, Samana, Cabrera, Puerto Plata, Cibao and seeral other widely known tourists destinations.

Nature Of Business

It is a reality that the economy of Dominican Republic (DR) is highly volatile, this follows the observation of the three major economic crisis like that of 1980s and that of 1990, as well as the most recent banking crisis of 2003 to 2004. these are the major economic events that triggered devaluation of the currency, inflation, lower income levels, unemployment and generally rising poverty levels. Prior to 2003, the country was well towards the recovery trend until the 2003 bailout that was handed to the second largest private bank in the country. It is worth noting that before this bailout, the inflation was in single digits and the GDP grew 74% between 1992 to 2002. Due to the bailout, the economy of the economy shrank by 0.4% in 2003 and the inflation went up to 42.7% (Hanke & Steve, 2004).

It is however, worth noting that the economy is now well towards the recovery with the inflation rate stabilizing and the GDP growth rate has been experienced again, though with some skepticism, the investors are now coming back in significant numbers again.

The nature of business in the country over the last four decades has greatly shifted from agriculture and moved towards manufacturing, contraction as well as the FTZ or Free Trading Zone. The dominant business share is however still held by the service industry with tourism being the main service that is provided. For long, the GDP growth has been largely associated with the outstanding contribution from some four major industries namely the telecommunication, FTZ, financial service and most significantly the tourism sector. The business environment in the country is such that it is dominated by the large firms within the leading sectors with an outstanding 2/3 majority employed in the economy are within the firms that have less than twenty employees.

It is also worth noting that the DR has been actively pursuing the export promotion particularly through their FTZ with the export of goods and services almost doubling between 1993 at $4.1 billion to $8.2 billion in 2004 with a complementing rise in the imports from $5.5 billion to $9 billion within the period mentioned above. The majority of the trade that DR engages in is with the U.S.A. since 82% of exports going to the U.S.A. despite the bilateral trade agreements with some states like Spain. DR also stands out to be a giant exporter of tobacco, sugar, cocoa, vegetables, coffee and fruits. This has however decreased and the shift has been towards the labor intensive products like textile within its FTZ (Mongabay, 2012).

Current Situation

The republic, just like many others across the globe had its economy shaken by the recession and before that was the Hurricane Dean that saw the country losing an equivalent of 20% of the GDP in 2007. The DR has however recovered significantly in 2010 to 2011 and is now stable again (World Fact Book, 2012).

With the tourism sector strongly dominating the economy of the DR, investors interested in other areas are weary due to the fact that if there could be any destabilization in the tourism industry, then the effects will affect even the other industries in the country and the entire country will be badly affected in terms of the economy.

There are some major steps and policies that have been put in place in order to ensure the economy of the country runs smoothly. Some are the significant tariff reform that saw the slashing of several tariffs by half and doing away with the off peaks. The other is the foreign investment law that opened all the sectors of the economy to foreign investment which saw the emerging of a private airport. Removal of restrictions on foreign exchange, technology transfer and ownership share is yet another step. There was also the establishment of the Center for Export and Promotion of Investment as a one stop shop for investors. The DR-CAFTA Free Trade Agreement that was signed with the U.S.A. And Central America and the other CARICOM FTA that was made with 15 Caribbean countries among other agreements was also geared towards strengthening the foreign investments within the country.

Marketing Strategies

The DR is one of the most endowed countries in terms of the tourism and the tourist destinations. It has over years employed various strategies to ensure that their tourism stays at the bets position in earning the country the foreign investments and the huge returns. With the several structures left behind from the discovery voyage times of Columbus, the colonial city of Santo Domingo DR has utilized these chances to ensure their name is at the top of the tourism table.

The DR has also garnered several accolades in various travel publications a factor that promotes their standing in the tourism sector above their neighbors. It has maintained the legacy of one of the top nine bets golf courses, top eight as best nightlife areas a factor that diversifies its tourism sector. The country has also conserved their wide range of plant species (5,600), 20 species of the land mammals as well as about 303 species of birds. These then attract more of the tourists that go to that region to make a stop-over to DR and make then not be confined to the hotels but tour the island (Baruch Barera, 2007).

The other significant strategy that was used in the ensuring that the tourism flourishes was the concentration on the uplifting of the standards of the airports within the country and the effect was the arrival of more planes taking advantage of the convenience, carrying tourists hence boosting the FDI of the country.

The other strategy has seen the significant market for the tourism sector is the huge number of hotel rooms that are found in DR. It is estimated that there are 60,000 hotel rooms in DR, actually the highest in the Caribbean region and they have no trouble being filled to the 75% capacity throughout the year. The other strength that the DR has and makes their market a leader in the tourism industry is the labor productivity of the region.

The country has also ensured that their current and future markets are taken care of from across the globe by teaching English in all schools even though the official language is Spanish. This is a strategy to ensure that they don't just get the Spanish speaking market but they are able to capture the significant English speaking market as well.

The Dominican Republic has also ensured that the tax in the tourism industry is one of the lowest within the region. This is an instrumental strategy to drive the demand up s compared to the other countries or islands within the Caribbean region.

Target Markets

Apart from the obvious foreign markets that are targeted as mentioned before from the U.S.A. And the Central America as well as other Spanish speaking regions, the DR also targets highly the internal or local tourists. The relatively vast population has seen the rise of a middle class that has driven the local demand for the tourism services. There is also the presence of the foreign investors that creates another special kind of demand for the tourism sector.


There is a wide variety of tourist that visit the DR. acceding to Baruch Barera, (2007), the DR hosts 96.3% of the…[continue]

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