The case is set in May 11, 2013, when the Shangri-La Bosphorus Hotel in Istanbul is inaugurated. The Hong Kong-based Shangri-La Hotels and Resorts is Asia Pacific’s leading luxury hotel group and globally regarded as one of the finest hotel ownership and management companies in the world. The group has grown to over 80 hotels and resorts in its 40-year history, though this will be the group’s first venture into in Turkey.
There have been many challenges in launching the hotel. This has included delays in completing the project and hiring high caliber customer service-oriented staff, of which Shangri-La is known for. On-going retention and development of the employees is also a key challenge. Moreover, the Shangri-La brand is not very well known in the highly competitive Turkish and regional markets, and so brand awareness must be enhanced.
How should Shangri-La Bosphorus position itself against competitors? In the long-term, what will drive the hotel’s growth? Over and above, the financial viability of the Bosphorus project is of key importance to the group.
Through this case, students have an opportunity to understand the challenges that the Shangri-La Group faces as it enters a new market, where the brand is not well known. Students will learn to explain marketing and positioning strategies, and also use key concepts in calculating break-even for a new hotel.
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