Strategic triangle, Bermuda Triangle and 1,2,3 theory are the basic toolbox for a good Touristologist .

To end this season I propose to you to sharp up a little bit our basic toolbox with some real data related to “Sidorme” a quite new brand of hotels in Spain (far away from the place I’m writing this post)  Do you want to try? Make yourself at home!

“Sidorme” is the brainchild of Fernando Rivas. It’s a low cost chain of hotel but Mr. Rivas prefers to describe it as Quality Low cost.  As you can see if you visit its website they cross Spain from coast to coast.

We have been dealing with  Bermuda Triangle and 1,2,3 theory in this OUR blog, and I’m sure that you remember quite well Strategic Triangle but just to be sure I provided a short summary of it, because... maybe I haven’t had the privilege of being your teacher (as long you think that Touristology is a science and that a Touristologist deserves at least the same respect that any graduates... you are welcome and you can consider me your fellow Touristologist!) or maybe you were my student and you had the habit to throw away all your notes at the end of each subject (believe me I have students that do just so!!!) and after a few years struggling in the jungle you regret that (Don’t worry life not always give a second opportunity but I always do!  I have to... because I’m so good as my Touristologist are!!!)

Anyway, here you have a visual representation of the Strategic Triangle:

 

Can you apply the Decrease Relationship and Differentiation ideas for “Sidorme”? To provide some data let’s supposed that www.tunehotels.com pretends to set up operations here in Spain.

In order to practice Decrease Relationship please visit this page of the “Tune Hotels” site  or if you prefer this youtube address.

Pay special attention to the sentences that they highlight like “ If I’m not using it, I’m not paying for it. SIMPLE” or “Tune Hotels.com is a SMART CHOICE” Smart Choice? Where did I listen to this sentence before? Well, never mind! Or does it mind?

In order to practice Differentiation you must be sure to choose a quality and pass the test of the following triumvirate:

1) Be the first: Are we the first to offer this quality?

2) TRUE add value: Is this quality important for the customer?

3) Difficult to copy: Is it difficult to copy?

When you finish with a quality you can try another one!

Try to relate the result of the test with the fast expansion of “Sidorme” in Spain. I mean, do you believe that a fast expansion it was mandatory or optional?

What about how to increase the relationship? Did you see this sentence “Tune Hotels.com Financially Incentives people to think about their energy consumption” Do you believe that Tune Hotels.com is using at least one of the four ideas present in the graphical vision of the Strategy Triangle?

Executives from “Sidorme” (some of them former students of mine and today fellow Touristologist!!!) explain in several articles a little bit of financial information:

Average Investment of each hotel: 4M €

Average rooms: 77-98€

Average price: 36€

Not Travel Agency. Rewards Programs instead!

Can you use Bermuda Triangle to confirm these figures?
 

The same founder father made the following statement ‘In Spain there are 3M self-employed working and travelling from Monday to Friday. This is our segment” said Mr. Rivas.

Can you use 1,2,3 theory based upon this sentence?

 

With this data you can practice BUT if you are a really Touristologist you would prefer to do your own research and to find and verify your own information. Do you see? You were reading this post and at the same time you were looking for more information, making your own conclusions, thinking about the possibility to create something similar or absolutely different. Do you see? You have become a Touristologist! WELCOME ABOARD... And HAPPY NEW YEAR!!!!

Remember... "Just don't give up trying to do what you really want to do. Where there's love and inspiration, I don't think you can go wrong". - Ella Fitzgerald

Do you need to do a viability study? Here my proposal:1,2, 3 theory for marketing AND Bermuda triangle for the financial area.

Sometimes I have to do a viability study, as you know a complete one has to deal with financial and marketing concepts.

For marketing in tourism I think nothing can defeat 1,2,3 theory both for initial positioning and for subsequent  growing strategies.

What about the financial area? Will I recover the investment? When? Will I get a decent profit? How much?  Will I have enough liquidity? All of these questions worth a lot of study and a great amount of excel sheets, but sometimes I need to provide a fast answer or I need a good beginning for the process or I need to decide which project is the best to focus on. Then Bermuda triangle is a good choice!

Most of my students hate and are afraid of anything related with numbers. My first subject as a teacher in Touristology was Financial Mathematics. So, I know firsthand the necessity to explain difficult concepts in a simple way. Have I succeeded it? You can tell me!

Nowadays, at least in my country, this topic or not exist or is given in a way that doesn’t provide a framework related to our field. 
Nevertheless, I strongly believe that knowing the investment to create a tourism company, the average revenue, the percentage of the most usual cost, the average profit... is something that we, as a Touristologists, must master.

For that reason I proudly introduce... THE BERMUDA TRIANGLE. Its name stands for the famous triangle in Bermudas where ships, carriers... have disappeared. The same happens with a business without balance between investment, revenues and profits... it will disappear!

It’s a financial-geometrical figure which represents the necessary investment to create a company, the revenues when the business is a cruise’s speed and the usual profit without taxes. Cruise’s speed? I mean, usually companies need a few years to get his full potential. It can be four years or sometimes a single day. Anyway we choose this amount.

 

All these numbers represents an average of the range that you can find in a real scenario. They are only a start point to become the hard work BUT they are a good beginning!

The investment is base in my experience; feel free to bring new examples to backup OR NOT this numbers. When we are talking about hotels of 3-4 starts in a centric area an alternative way to assess the investment is to multiply 120,000 by the number of rooms. Of course, this is less true for hotels with a lot of space for conventions, bar, restaurant, etc.

For instance, we can see if Sol Melia (the biggest chain of hotels in Spain) can fit in this Bermuda Triangle. In order to get some numbers you can go to here.

I summarise for you the key information for 2010:

Number of hotels 350; Company’s revenues: 1.3billion (for non English people remember that one billion equals to 1,000 M!!!); Profit: 50.1M Can you do the math? Does it fit? You must remember that 2010 was a tough year!

I Love Touristology even when mathematics and programming skills are required!!!

As you can see Bermuda Triangle is a fast way to know if a project can have future or if it’s worth to go deeper.  What do you think? Can you provide more examples?  Let’s build up the bedrock for the best science ever... TOURISTOLOGY!!!!