Horizontal integration is a business strategy that involves the acquisition or merger of companies that operate in the same industry or market. The travel and tourism industry is no exception to this trend, with many companies expanding their reach by acquiring or merging with other businesses. In this article, we will take a closer look at an example of horizontal integration in travel and tourism.
One prominent example of horizontal integration in the travel and tourism industry is the acquisition of Starwood Hotels & Resorts Worldwide by Marriott International in 2016. This merger brought together two of the largest hotel chains in the world, with a combined portfolio of over 30 hotel brands and more than 5,500 properties across 110 countries.
The Benefits of Horizontal Integration
Horizontal integration can provide several benefits to companies in the travel and tourism industry. By acquiring or merging with other businesses, companies can:
Increase Market Share: Horizontal integration allows companies to expand their reach into new markets and gain access to new customer segments. This can help increase their market share and revenue.
Reduce Competition: By acquiring or merging with other businesses, companies can eliminate competition and gain a competitive advantage in the marketplace.
Realize Economies of Scale: By combining resources, companies can achieve economies of scale that lead to cost savings and increased efficiency.
- The Marriott-Starwood Merger
The Marriott-Starwood merger was one of the largest transactions in the history of the travel and tourism industry. The deal was valued at $13.3 billion and created a company with over 1.2 million hotel rooms worldwide.
The Impact on Marriott International
The acquisition of Starwood Hotels & Resorts Worldwide has had a significant impact on Marriott International’s business operations. The company now has an expanded portfolio of brands that cater to a wide range of customers, from luxury travelers to budget-conscious tourists.
The Impact on Starwood Hotels & Resorts Worldwide
The merger has also had a positive impact on Starwood Hotels & Resorts Worldwide, which is now able to leverage Marriott International’s resources and expertise to expand its global footprint. The company has also been able to benefit from the increased marketing and promotional activities that come with being part of a larger organization.
Conclusion
Horizontal integration is a popular business strategy in the travel and tourism industry, with many companies looking to expand their reach by acquiring or merging with other businesses. The Marriott-Starwood merger is a prime example of how horizontal integration can benefit companies in this industry, by increasing market share, reducing competition, and achieving economies of scale. As the travel and tourism industry continues to evolve, it will be interesting to see how other companies adopt this strategy to achieve their business objectives.
10 Related Question Answers Found
In the world of travel and tourism, vertical integration is a term that is often used to describe the way in which different businesses work together to provide a complete travel experience for customers. Simply put, vertical integration refers to the process of combining two or more stages of the travel supply chain under one ownership or management structure. What is Vertical Integration?
When it comes to the world of hospitality and tourism, there are often two terms that are used interchangeably: travel industry and tourism industry. While both of these industries revolve around travel, they actually have distinct differences. The Tourism Industry
The tourism industry is focused on the activities that travelers participate in during their trips.
What Is the Difference Between Travel and Tourism? Many people use the terms ‘travel’ and ‘tourism’ interchangeably, but they are not the same. Although both involve going to different places and experiencing new things, there are significant differences between them.
When it comes to exploring new destinations and experiencing different cultures, two terms that are often used interchangeably are travel industry and tourism industry. While they may seem similar, there are some key differences that set them apart. In this article, we will delve deeper into these differences.
Are travel and tourism the same thing? This is a question that many people ask, especially those who are new to the industry. Although both terms are used interchangeably, they are not entirely the same.
Travel and tourism are two terms that are often used interchangeably. However, there is a significant difference between the two. Travel: Travel refers to the act of moving from one place to another.
Travel and tourism are two terms that are often used interchangeably. However, there is a distinct difference between the two. Travel refers to the movement of people from one place to another, while tourism is the commercial organization and operation of vacations and visits to places of interest.
Tourism and travel are two concepts that are often used interchangeably, but they are not the same thing. While both involve moving from one place to another, there are several differences between the two. In this article, we will discuss the difference between tourism and travel industry.
When it comes to defining the tourism industry and the travel industry, many people tend to use these two terms interchangeably. However, there is a subtle difference between them that sets them apart. In this article, we will explore the key differences between the two industries.
Travel and Tourism are two terms that are often used interchangeably but have significant differences. While both industries involve people moving from one place to another for leisure, business, or other purposes, they have different objectives and impacts on the economy. Understanding the difference between travel and tourism is essential for anyone looking to be part of these industries.
