Case Study 1: Global Marketing's Theory
Reference: Kotabe and Helsen. "Global Marketing Management", Fifth Edition
Publisher: Wiley
Case 1: Club MED: Making A Comeback
Club Mediterran´ee (Club Med), a corporation in the all inclusive resort market, manages over 140 resort villages in Mediterranean, snow, inland, and tropical locales in over 40 countries.Its resorts do business under the Club Med, Valtur, Club Med Affaires (for business travelers), and Club Aquarius brand names. Club Med also operates tours and two cruise liners: Club Med 1 cruises the Caribbean and the Mediterranean, and Club Med 2 sails the Pacific. The company also arranges specialized sports facilities. Club Mediterranee's clientele is about one-third French, with the rest being mainly from North America and Japan.
Club Med found that its all-inclusive price is not as widely accepted today as it was in the past and that consumers’ preferences have changed. Vacationers are not willing to spend large amounts of money for vacations that include many activities they are not using as much as they had been in the past. This change in preference poses a problem for the company because Club Med’s competition has been able to customize travel packages for each consumer at prices that vacationers feel more comfortable with.
Although it appears easy for Club Med to customize travel packages, the company is at a disadvantage compared to its competition. Most of the competitors are found in a small number of locations, whereas Club Med has resorts scattered all over the world. Currency devaluation and political boycotts are some of the situations that Club Med faces worldwide on an ongoing basis. These external factors are reducing the company’s ability to increase sales and gain new customers.
BACKGROUND AND HISTORY
Club Mediterran´ee, otherwise known as ‘‘Club Med,’’ was originally founded by a group of travelers, headed by Gerald Blitz, in 1950. However, through the years, as this group was increasing in size, it was becoming increasingly more difficult to manage. Blitz, therefore, took the opportunity to turn this ‘‘association’’ into a business, with the aid of Gilbert Trigano, in 1954. Trigano sought to establish this organization, and by 1985, Club Mediterran´ee S.A. was transformed into a publicly traded company on the Paris Stock Exchange. Club Med Inc. became the U.S.-based subsidiary of Club Mediterran´ee, headed by Trigano’s son Serge. Today, Club Med encompasses over 114 villages, on six continents, and 33 countries (see Exhibit1). In addition, Club Med has two cruise ships.
Exhibit 1.
Club Med found that its all-inclusive price is not as widely accepted today as it was in the past and that consumers’ preferences have changed. Vacationers are not willing to spend large amounts of money for vacations that include many activities they are not using as much as they had been in the past. This change in preference poses a problem for the company because Club Med’s competition has been able to customize travel packages for each consumer at prices that vacationers feel more comfortable with.
Although it appears easy for Club Med to customize travel packages, the company is at a disadvantage compared to its competition. Most of the competitors are found in a small number of locations, whereas Club Med has resorts scattered all over the world. Currency devaluation and political boycotts are some of the situations that Club Med faces worldwide on an ongoing basis. These external factors are reducing the company’s ability to increase sales and gain new customers.
BACKGROUND AND HISTORY
Club Mediterran´ee, otherwise known as ‘‘Club Med,’’ was originally founded by a group of travelers, headed by Gerald Blitz, in 1950. However, through the years, as this group was increasing in size, it was becoming increasingly more difficult to manage. Blitz, therefore, took the opportunity to turn this ‘‘association’’ into a business, with the aid of Gilbert Trigano, in 1954. Trigano sought to establish this organization, and by 1985, Club Mediterran´ee S.A. was transformed into a publicly traded company on the Paris Stock Exchange. Club Med Inc. became the U.S.-based subsidiary of Club Mediterran´ee, headed by Trigano’s son Serge. Today, Club Med encompasses over 114 villages, on six continents, and 33 countries (see Exhibit1). In addition, Club Med has two cruise ships.
Exhibit 1.
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