The Core Concepts and Principles of Marketing at the Burj Al Arab Hotel, Dubai

Hugh Taylor from Edwardian Hotels stated that ‘Marketing is not an elusive art, it is more a science of identifying customer needs and wants and presenting a package that answers these needs’ (1993, pp. 16). I am going to be investigating the core concepts and principles of this ‘science’ and how it applies to the Burj Al Arab Hotel in Dubai. The Burj Al Arab, also known to some as The Burj, is the landmark hotel of Dubai with a height of three hundred and twenty one metres and magnificent architecture.

It oozes luxury with its fantastic facilities, exceptional service and wealthy clientele. I am going to be looking at how they have secured their place in the market and what they have done in the way of marketing to become such an ‘extraordinary’ hotel (Jumeirah, 2012). Customer Needs and Buyer Behaviour Marketing has become more than just ‘telling and selling’ these days with it now being understood as also satisfying customer needs (Armstrong & Kotler, pp.

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4).

It is all about identifying demand, which is defined as ‘the systematic gathering, recording, analysis and utilisation of information related to all factors which affect a business operator’ (Roberts, pp. 82). If a hotel operator cannot clearly recognise not only the customer's needs and requirements but the level of these, how are they ever going to be able to make their business successful? The main method of identifying customer needs is market research. There are many ways of gathering this research such as telephone surveys, personal interviews, guest comment data, mailed questionnaires and competitor analysis.

In the way of the Burj Al Arab, after leaving the hotel they email questionnaires to customers and hand out guest questionnaires (see appendix 1), which asks them to give their details and then leaves space for them to write about their experience at the hotel. Customer care has become one of the most important elements of any business that deals with customers as it is seen as the best way of maintaining and developing a profitable business, especially in the case of hotels where everything revolves around keeping the clientele happy.

On the Expedia website, a customer review of The Burj Al Arab stated that ‘the staff at Burj Al Arab was above and beyond our imagination of good customer service’ (Expedia, 2011). Once potential demand and customer needs are established, the hospitality operator will gain the knowledge and understanding of what influences really exist in buyer behaviour. Some of these influences are location and accessibility, cost, value and quality, style and ambience, advertising, recommendations and previous experiences amongst many more (Roberts, pp. 162-163).

Segmentation, Targeting and Positioning When marketing a product such as a hotel, one has to realise that everyone is different therefore making it impossible to cater to all their individual needs. You could either go with the mass marketing approach, which only works for a similar market where everyone’s needs are similar, or adopt market segmentation. This is simply defined as ‘the separation of groups into more easily targeted segments’ (Roberts, pp. 65). Market targeting is all about choosing which segmented group will fit with your product.

The market can be segmented with geography, demographics, psychographics and behaviour. Segmenting the market geographically will look at different areas and whether they are wealthy or not for example. You’ve also got to look at whether your product will fit into a specific area. For example, The Burj Al Arab have targeted the correct area to start their luxury and expensive hotel as Dubai is generally seen as a wealthy country where the tourists have a lot of money to spend but the fact that they have chosen the coastline makes it stand out as no other hotel in Dubai is on the beach.

It will also be the first thing that boats see when they arrive at the Dubai ports as it is 321 metres tall (Dubai architecture, 2011). Demographics look at the age, gender, race, religion, occupation, education and income of the market. For this category, The Burj is targeting middle aged and older couples of all races who have a good education and a high income. Psychographics looks at social class, lifestyle and personality therefore The Burj is targeting high class people who are looking for a luxury break with their partner. Behavioural segmentation is based on the use of a product.

For example, The Burj is the type of hotel that people aspire to stay at during some point in their life. The people that stay there are either very wealthy and stay there on a regular basis, or people who plan on going there once for a special occasion or a treat. Market positioning is the way that the customers define the product in the way of its important elements. For example, its physical attributes such as if a hotel has a spa or a pool, personnel which is based on how good the staff are, location and if it is conveniently placed and image, which is really about the products reputation and branding.

For the Burj Al Arab, it is mainly defined by its physical attributes such as the fact that it was built to resemble a billowing sail of a dhow, which is a type of Arabian vessel (Dubai Architecture, 2011). The architecture makes it stand out from all the other buildings in Dubai seeing as it has now become a landmark for the country. It also has many features such as a spa, a private beach and many other attributes like this. The personnel is a very big part of the hotel seeing as there is a twenty four hour butler service and personal shoppers available (Jumeirah, 2012).

They also pride themselves on their location being right on the coast but also a short drive away from Dubai’s city centre. Since starting the hotel, The Burj Al Arab has developed and secured and image of excellence and luxury for the world to see. Product ‘The hospitality industry has no one product, rather a range of products which are aimed at attracting different customers and for different reasons’ (Roberts, pp. 27). When taking apart the product, there are four levels to consider.

First of all the core product which is another way of saying ‘What is the buyer really buying? (Armstrong & Kotler, pp. 220). It is the centre of the product and what people immediately look for when in search of a product or service. When looking at the Burj Al Arab, its core product is the luxury aspect of it. According to the Jumeirah Website, the Burj Al Arab is ‘the world’s most luxurious hotel and the ultimate in Arabian hospitality’ (Jumeirah, 2012). This is what people see when they are looking for a hotel in Dubai.

When looking at the facilitating products, they are ‘the services or goods that must be present for the customer to use the core product’ (Scribd, 2011). The Burj Al Arab’s facilitating product is the reception as the customers would not be able to access their hotel room if this and the staff were not there to assist. The supporting product is not absolutely necessary in the running of a hospitality outlet but they do help in attracting the customers. They are defined as ‘extra products offered to add value to the core product and help to differentiate it from competition’ (Scribd, 2011).

The Burj Al Arab’s supporting products would be the six award winning restaurants, the conference and banqueting venues, the butler service for every room, the assawan spa and health club, the private beach, infinity pools and the unlimited access to the best water park in Dubai, Wild Wadi (Jumeirah, 2012). The last level of the product is the augmented product which combines accessibility, atmosphere and customer interaction with the core, facilitating and supporting products. The augmented product for the Burj is the design of the hotel as it has become such a landmark for Dubai in the short period of time that it has been there.

It has been described as ‘legendary’ and ‘symbolic’ and one of the most photographed buildings in the world (Emirates, 2011). Professionals in the marketing business have a very important job to ‘create, maintain, protect and enhance brands of their product or service (Armstrong & Kotler, pp. 227). If you have a well established and valuable brand, it shows trust and reliability within the company therefore will attract more customers. There are some disadvantages of branding though such as the fact that as the market demand is changing the brand and product may become old fashioned and out of date.

The Burj Al Arab is part of the Jumeirah group who have a reputation and a consistency to produce top quality hotels around the world. Their brand is luxury, which so far, has been kept intact. In the case of the Burj, there is always the worry that customers will start to recognize the brand as high quality but also too high in cost especially in times like the recession where companies may experience a reduction in the amount of customers they get (Roberts, pp. 76). The product life cycle is ‘the stages products go through in relation to cost, profitability and demand’.

The first stage is product development where the company initially finds and develops the new product. The next part of it is the introduction stage where the new product is introduced into the market. This stage takes time and effort as sales will generally be slow and profit nonexistent due to the spending in the product introduction. The growth stage is next, which should hopefully consist of quick market acceptance and rising profits and customer awareness. The product will then enter the maturity stage where the sales will slow down due to the product gaining acceptance from potential buyers.

The last stage is the decline when sales will fall and profits will drop due to the demand through the increasing competition or change in consumer behaviour. (Roberts, pp. 68-73) (Armstrong & Kotler, pp. 276-283) Price There are some important factors to consider when working out the pricing for a hotel such as whether the main objective is to increase profits or to uphold a reputation. The hotel price not only needs to cover the room rate etc but the cost of promoting the product as well.

In the case of The Burj, they are obviously trying to make a large profit but I would say that the main reason they price so highly is because they want to make it more of a luxury product. The pricing strategy that they use is prestige pricing, which is a tactic that evokes a premium product and service and gives off a high quality image. This happens in a lot of places, for example the director of Greens Lawns Hotel and Restaurant said that ‘despite reduced demand for our a la carte menu, we decided that to reduce prices would result in a reduction in quality for the customer...

To have reduced standards would have been an unacceptable strategy’ (Roberts, pp. 17). This just shows that ‘consumers tend to equate high prices with high quality’ (Lamb, Hair Jr & McDaniel, pp. 19). At the peak time of December, the cheapest room you can get is ? 1,099 per night. Another example of prestige pricing is there spa; a classic manicure and pedicure is ? 121 and the romantic moonlight swim, which consists of a couples massage, moonlight swim in private infinity pool, champagne, roses and monogrammed Burj Al Arab bath robes is ? 1,223 (See appendix 2 for other spa packages and pricing).

Place When it comes to the actual place, the location is very important to companies whose customers come to them. According to an American hotelier, ‘there’s only four things to consider when opening a hotel: location, location, location and location’ (Roberts, pp. 18). When deciding the location, it is vital to take into account the attractiveness, potential demand, accessibility for customers and presence of competitors in the area. The hotel that I am researching has taken these factors into great consideration starting off with the attractiveness of the hotel.

They have chosen the perfect location with it being situated on the coastline of Dubai surrounded by beautiful beaches. In terms of potential demand, The Burj Al Arab was built during the creation of the modern Emirate therefore there a lot of other luxury hotels being built at the same time. The Burj was not built because of the fact that there were no luxury hotels in Dubai but because they wanted to design something that symbolised ‘Dubai's urban transformation’ (Dubai Architecture, 2011).

Their accessibility could be seen as rather difficult with it being located on a small manmade island off the coast with a bridge connecting the two together. Also, the only way for non residents to get into the hotel is for them to book a table at one of the hotel’s restaurants. This could be seen as a good idea for security reasons but it also makes it look slightly pompous in the way that they will not just let anyone in. Taking tourists into account, it is a short drive away from the city, which goes in its favour.

The hotel is almost surrounded by competitors offering the same kind of service yet this is irrelevant with the fact that The Burj Al Arab has the best reputation due to its seven star rating and exceptional service and facilities. The place not only involves the physical location though, it is also the availability and accessibility. The Burj Al Arab is very lucky in that it is not just a seasonal hotel due to Dubai’s weather being very good all year round. This makes its availability brilliant seeing that there is nothing stopping customers in this department staying at the hotel.

A big issue that will come in accessibility is the price, which is very high therefore it will put people off going there. Promotion The last thing that is considered when creating a product is ‘how information related to the product will be communicated and promoted to potential customers’; also known as promotions. The reason hotels do this is to raise customer awareness of their service, produce positive demand and then maintain this demand (Roberts, pp. 31). One way of promoting your product is through advertising.

This means of promotion isn’t just used for companies but also for a lot of non-profit organisations and professionals as well to advertise their offers to different target markets. The Burj Al Arab has created a range of adverts in the past to promote the hotel as ‘luxury’ (See appendices 3 & 4). These adverts are implying that consumers should leave their normal lives behind and come and stay at the Burj where they will experience an ‘extraordinary’ stay. This type of promotion is called fantasy as it almost creates a wonder world around the hotel.

One of the methods used to promote a company is through public relations which is defined as ‘the deliberate, planned and sustained effort to establish mutual understanding between an organisation and its public’ (Roberts, pp. 129). Public relations, or PR, is being used a lot more now due to increasing costs of advertising and sales promotions. Their way of doing things in the business is all about creating opportunities to positively promote the product or service for example through memorable events, product publicity, corporate communication and lobbying.

When looking at the Burj Al Arab, they have created a lot of media attention since starting the company. For example, on 31st December 2011 The Burj hosted their first New Years Eve party on the beach at ? 113 per person (Arabian Business, 2011). Something that is currently being planned is the Chinese New Year celebration at The Burj where they will be holding a special party on 23rd January. The hotel will also be turning red paying homage to the ‘most important celebration in the Chinese calendar’ (Haute Living, 2012).

Something that is brilliant publicity for The Burj Al Arab is the World Travel Awards where they have received ninety nominations in total and won thirty five of them. These include winning the ‘World’s Leading All Suite Hotel’ eight times and the ‘Middle East’s Leading Hotel’ every year since 2004 (World Travel Awards, 2012). Conclusion After investigating The Burj Al Arab hotel’s customer needs, buyer behaviour, target market, segmentation, positioning, product, place, price and promotions, I have come to the conclusion that they are excellent at marketing their product; simply ‘the world’s most luxurious hotel’ (Jumeirah, 2012).