Industry Environment of Four Seasons Hotel

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Analyze the industry environment of Four Seasons Hotel

Industry lifecycle: The state of the Four Seasons Hotels

The lifecycle of an industry takes the form of four distinct stages: the introduction of the product or service, growth, maturity, and decline (Product life cycle, 2012, Tutor2U). The Four Seasons is one of the most venerable hotels in the marketplace today. It made significant gains in the 1990s when Regent International hotel sold its hotels to the chain, giving the Four Seasons "an instantly expanded position in Pacific Asia, and also created the basis for expansion of the Four Seasons brand in Europe and Asia" (Go 1996). Even before this international acquisition, the Four Seasons was an international brand, and was particularly famous for its New York incarnation, where its food was considered to rival that of four and five star free-standing restaurants, which is highly unusual for a hotel.

Despite the recent recession, the Four Seasons was relatively well-positioned to weather the economic downturn. The luxury market rebounded strongly and swiftly, even while middle class consumers were still struggling. "If a designer shoe goes up from $800 to $860, who notices?" said a retailer at Saks Fifth Avenue (Clifford 2011). The same is true of an expensive hotel room -- when the price goes up for a luxury consumer who is dependent upon investment rather than salary-based income, there is less concern than for a middle-class consumer on a budget who is worried about his or her job security.

The international diversification also positioned the Four Seasons well, in terms of managing risk. Asia rebounded more quickly than the United States and Europe from the global recession, and the fact that the Four Seasons has been building its brand in the region ensures that it can focus on the economically 'healthier' areas of the world, even if there is still doubts about the viability of the European Union's ability to prevent economic instability. Also, because the Four Seasons is an international brand, it attracts many international travelers from around the world to its European and United States locations, even when those nations are not thriving domestically.

Because of its age, the Four Seasons might seem to be in the 'maturity' stages of its brand identity. However, because its areas of outreach include developing markets such as Hong Kong and Singapore, it may be said to be 'growing' in those areas. The Four Seasons has attempted to reinvent itself as a brand of high status within Asia, and has also established a thriving and expanding presence in the Middle East, including cities such as Cairo and Beirut. It also has plans to expand into St. Petersburg, to serve the interests of the expanding Russian luxury market (Four Seasons, 2012, Official Website).

However, while the state of the luxury hotel chain is not as dire as one might think, given the state of the global economy, it is important to consider that the market for luxury hotels in general may be shifting and changing. Amongst the elite, there is increased interest in the use of 'boutique' or small hotels, rather than large-scale institutions like the Four Seasons. Some competitors are buying large former estates, for customers who wish the experience of staying at a country house, rather than a traditional, large-scale hotel setting (Lockwood 2005). The Four Seasons has been striving to increase its amenities for customers, to demonstrate the value added of going to its chains but it is still fundamentally a traditional hotel: "The Four Seasons Beverly Wilshire Hotel downloads pictures of VIPs from the Internet and posts them on department bulletin boards so employees can greet guests by name at every encounter...Four Seasons San Francisco gives guests free use of a chauffeured Lincoln Town Car on a first-come, first-served basis, has a museum-quality private art collection with 80 pieces and a minibar for kids" (Barnett 2003).