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1、CLUB MED- THE PARTY IS OVERClub Mediterrane (Club Med), a corporation in the all-inclusive resort market, manages 140 resort villages in Mediterranean, snow, inland, and tropical locales in over 35 countries. Its resorts do business under the Club Med, Valtur, Club Med Affaires (for business travele
2、rs), and Club Aquarius brand names. Club Med also operates tours and 2 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 Mediterranees clientele is about 1/3 French, with the rest bei
3、ng mainly from North America and Japan.Club Med found that its all-inclusive price is not as widely accepted as it has been in the past. The firm has found that consumers preferences have changed. Vacationers are not willing to spend large amounts of money for vacations which include many activities
4、 that the vacationers are not using as much as they had been in the past. This change in preference poses a problem for the company because Club Meds competition has been able to customize travel packages for each consumer at prices that vacationers feel more comfortable with.Though it appears easy
5、for Club Med to also 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, while Club Med has resorts scattered all over the world. Currency devaluation and political boycotts are some of the situati
6、ons that Club Med faces world-wide on an ongoing basis. These external factors are reducing the companys ability to increase sales and gain new customers.BACKGROUND AND HISTORYClub Mediterranee, otherwise known as “Club Med,” was originally founded by a group of travelers, headed by Gerald Blitz, in
7、 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,
8、and by 1985, Club Mediterranee 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 Mediterranee, headed by Triganos son Serge. Today, Club Med encompasses over 114 villages, on six continents, and thirty three countr
9、ies (see Exhibit 1). In addition, Club Med has two cruise ships. The company owns around 100 properties all over the world.The Club Med style can be best described by the sense of closeness found among the managers. All managers are former village chiefs and are therefore knowledgeable of the compan
10、ys everyday operations. This immediately reflects on the “friendly” relationships that the GOs (Club Med-speak for assistants or gracious organizers) and GMs (Club Med-speak for guests or gracious members) have with each other making every vacationers experience a memorable one. A distinguishing fea
11、ture of a Club Med resort is the living area, which is much simpler than that of a typical hotel chain. Rooms are sparsely decorated (i.e., no phones, televisions, etc.). This simpler approach has made Club Med very successful. Another key to success was Club Meds image as a place to go when you wan
12、t to escape. Finally, unlike typical hotel chains, Club Med measures its capacity in each resort by the number of beds, not the number of rooms, since singles have roommates.INDUSTRY STRUCTUREUntil 1986, Club Med had a very strong position in the all-inclusive resort market. The corporations level o
13、f bargaining power with buyers, suppliers, and labor was high (see Exhibit 2). During that time period a client interested in duplicating “the Club Med experience” would have had to pay an additional 50 percent to 100 percent to have an identical experience at other resorts (see Exhibit 3). With reg
14、ard to suppliers, companies that provided vacation-related services, such as airlines, were willing to give Club Med significant discounts in exchange for mass-bookings. Finding labor was not a problem for this resort chain because thousands of people were interested in working at such a pleasurable
15、 location.COMPETITIONAs of 1986, Club Med began facing competition. This company was no longer the only all-inclusive resort. Many of the firms competitors were realizing similar success. In 1986, most of the all-inclusive competitors had adopted Club Meds style of recreational activities with staff
16、 members acting as directors of these organized games. By then, the only major difference that Club Med maintained was the fact that their price did not include drinks.One competitor, Jack Tar Village, the Jamaica-based company, operates resorts located mostly in the Caribbean. Jack Tar positions the resorts as more glamorous and modern than those of Club Med. This can be seen in advertisements where the company implicitly criticizes the spartan rooms and methods of Club Me
