This paper deals with the impact of the internet and social media on the hotel industry. In particular, it points out how the rules of the game have changed in today’s dynamic and global environment and how hotels need to operate if they are to succeed from a long-term perspective. Likewise, it outlines how activities on both the buy-side and sell-side can be enhanced through the implementation of internet-enabled technologies. Furthermore, the paper highlights barriers that might inhibit further development of e-business. Practical examples are used throughout the paper and an industry analysis using Michael Porter’s Five Forces model and a case study are provided in the appendices in order to promote understanding.
Table of Contents
1. Impact of the internet and social media on the hotel industry
2. Appendix A: Porter’s Five Forces Analysis
3. Appendix B: Omena Hotels Case Study
4. References
Research Objectives and Themes
This paper examines the transformative impact of the internet and digital technologies on the hotel industry, specifically focusing on how these tools reshape operational strategies, supply chain management, and customer interactions. It seeks to answer how hotels can leverage e-business to maintain a competitive advantage while navigating the challenges posed by new market dynamics and digital disruptions.
- The influence of e-procurement on process efficiency and collective buying power.
- The shift from passive to proactive customers and the role of social media in reputation management.
- Strategic adaptation and the implementation of dynamic capabilities in a digital environment.
- The integration of e-business models as a driver for cost and differentiation advantages.
- Challenges related to data security, IT dependence, and organizational resistance to change.
Excerpt from the Publication
Omena Hotels Case Study
The following case study shows that information technology has even become an essential component of business models, which is exemplified by the hotel chain “Omena Hotels” which operates hotels in Finland and Denmark. Even if the leading hotel chains such as IHG, Hilton, Marriott or Starwood seem to dominate the hotel industry, Omena Hotels has bridged a gap in the market by introducing a new business model that completely relies on and takes advantage of information technology.
At first glance Omena Hotels’ concept seems unfeasible as it provides high class and well equipped accommodation at discount prices. It achieves this by focusing on the core product the majority of city and business travellers seek, which is simply a room for the night. Omena Hotels left out facilities which are not part of the core product, such as reception and concierge desk, restaurant, bar, coffee shop or spa. Since each hotel is located in the city centre, a great deal of shops, restaurants and bars are within convenient range. All the rooms are similar in terms of size and offer state-of-the-art equipment including a flat screen TV, microwave, fridge and free WiFi internet. Furthermore, the hotels employ no staff, but one fulltime manager. A modern CCTV system monitors the entrance and hallways to ensure safety.
Summary of Chapters
Impact of the internet and social media on the hotel industry: This chapter analyzes how digital disruption, e-procurement, and online booking platforms have fundamentally altered the competitive landscape, emphasizing the need for hotels to shift towards proactive digital strategies.
Appendix A: Porter’s Five Forces Analysis: This section applies Michael Porter’s framework to the hotel industry, illustrating how the internet has shifted power towards buyers and increased the threat of new entrants and substitutes.
Appendix B: Omena Hotels Case Study: This case study demonstrates the successful implementation of an IT-reliant business model, highlighting the balance between cost reduction through automation and the critical importance of data security.
References: This section provides a comprehensive list of all academic and industry sources utilized throughout the paper to support the discussed arguments.
Keywords
Hotel industry, E-business, Digital transformation, Internet impact, E-procurement, Supply chain management, Online intermediaries, Social media, Customer experience, Reputation management, Porter’s Five Forces, Omena Hotels, Dynamic capabilities, Data security, Competitive advantage.
Frequently Asked Questions
What is the core focus of this paper?
The paper explores the profound impact of the internet and social media on the hotel industry, covering both the operational supply chain aspects and the customer-facing marketing side.
What are the primary themes discussed?
The main themes include e-procurement efficiency, the power shift toward digital-savvy customers, the importance of online reputation management, and the necessity of strategic agility.
What is the main research objective?
The objective is to explain how hotels must operate and adapt their strategies to succeed in a global, internet-driven environment while overcoming barriers to e-business development.
Which scientific methodology is employed?
The paper utilizes industry analysis via Michael Porter’s Five Forces model and a practical case study approach, supported by extensive literature research.
What topics are covered in the main body?
The main body addresses the disruption caused by the internet, the benefits of e-SCM, the influence of online booking platforms, the transition to proactive customer engagement, and the need for dynamic management strategies.
How would you characterize this paper with keywords?
Key terms include e-business, digital transformation, supply chain management, Porter’s Five Forces, and strategic management in the hospitality sector.
How does the Omena Hotels case study illustrate the paper's argument?
It exemplifies how a business can successfully bridge a market gap by creating a fully automated, technology-reliant model that significantly reduces operating costs.
Why is data security highlighted as a significant concern for hotels?
As hotels become increasingly dependent on digital systems and collect sensitive customer data, vulnerabilities—such as the Tripadvisor data breach—pose significant risks to reputation and financial stability.
- Quote paper
- BA (Hons) Christoph Müller (Author), 2011, The impact of the internet and social media on the hotel industry, Munich, GRIN Verlag, https://www.hausarbeiten.de/document/170753
