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Posted on May 1st, 2014, by

The company’s internationalization strategy involves the use of its domestic model globally and also the use of franchising operations when the risks are too high. Besides these strategic elements, it has to be indicated that the domestic model includes the dynamic and unique character of each restaurant, including the attentive approach to each guest; there is also a merchandised shop in each cafe and it’s the core concept of the Hard Rock Café’s internationalization strategy. Additionally company applies e-commerce strategy to help the global branding extension.

Its strategic business approach may be defined as differentiation because its system incorporates differentiating features and the makes the guests of the Hard Rock Café to prefer its product over the products of the company’s rivals. As for the rivals, few could be named: cheaper substitutes such as McDonald’s; companies with the similar concept for instance Rainforest Café, Planet Hollywood International or HOB Entertainment.

Without a doubt, the global strategy requires deep PESTEL analysis of the possible markets and substantial expenditures. It has to be mentioned that Hard Rock Cafe business model faces a lot of risks when starting its businesses worldwide and therefore about half of the company’s business was launched under franchise.

The basic appeal for the Hard Rock Cafe business is definitely the country’s economic development that is interrelated with the GDP per capita. The level of income is a critically important factor for Hard Rock Cafe business because it targets the audience with the above middle level income. Another basic appeal for this company is obviously tourists because around 70% of Hard Rock’s visitors are tourists. Thus in the majority of cases when making a decision about opening a new venue, only popular tourist destinations are considered in the first turn. It’s a truly winning strategy for Hard Rock Cafe business that allowed it’s to make a dramatic expansion. But there are also some signs that Hard Rock Cafe management considers other audience as well. The major reason may be the recent economic problems that had a negative influence over the tourism. The following example of such strategic actions could be suggested: Nottingham, Manchester and Birmingham are the UK cities that aren’t standard tourist destinations, but nevertheless Hard Rock opened cafes there and attracted locals in these cities by upgrading the menus and thus the management make its venues less dependent on travelling audience.

It is known that Hard Rock Café sees itself as an entertainment and leisure company for true music lovers (Sherchan, 2009, Web) Each cafe is covered with authentic rock ‘n’ roll memorabilia and a design unique to its location. The cafes serve casual American food at moderate prices and each cafe has its own merchandise store. (Sherchan, 2009, Web)

It’s very important to point out that the management of the company aims to keep the irreverent free spirit atmosphere of the venues, despite the fact that it is a global network. For instance, Hard Rock Café make an emphasis on the rock ‘n’ roll atmosphere of the early seventies and management use small music venues hosting live bands; thus cozy atmosphere of the cafes is created.

 

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