Reference no: EM132310397

Question: This week's discussion assignment relates to the topic of marketing strategies discussed in Chapter 2. Similar to other business organizations, Marriott International Inc. revisits and adjusts its strategies to help focus and direct its efforts to accomplish its corporate objectives. As the world's biggest hotel operator, with about 1.3 million guest rooms globally, Marriott is poised to be one of the first major hotel companies to create a US home-rental platform, aiming to take on Airbnb and other home-sharing companies. Some hotel executives, who had long dismissed Airbnb and HomeAway, now believe they are growing partly at the expense of hotel companies, especially with leisure travelers and large families. Guests can book through the Marriott web site, earn rewards points and redeem them. Marriott had a pilot initiative in Europe. Guests stayed triple the typical hotel length. Customers wanted more space with kitchen and laundry facilities. Airbnb faces both increased competition in its core segment and heightened regulatory scrutiny in some cities.

It is a truism that when other firms cross the line to enter into your business, a natural strategic reaction is to parry the thrust and move into theirs. In this case, Airbnb has a response of its own. The online lodging company has been moving aggressively into the traditional hospitality business. Airbnb is acquiring Hotel Tonight, a company that culls inventory from hotels and offers discounted rooms. This is a significant strategic shift for both Marriott and Airbnb as well as other big hotel operators, including Hilton and Hyatt, that have been exploring the home-rental business.

1. Discuss the term "convergence" and how it is illustrated by recent strategies adopted by Marriott and Airbnb.

2. Does Marriott have any competitive advantages over Airbnb that it can exploit in the home-rental market? Discuss them. What are the risks of entering the home-rental market for Marriott?