Master in Marketing andCommunications Business Model Analysis BARONSHOSTELPurpose of Institution/BusinessBarons Hostel is a family owned business inthe hospitality industry in Nairobi, Kenya. It is in the suburbs of Karen.Initially, Barons Hostel was providing accommodation to female students fromnearby universities and institutions. This business has been carrying on for 10years. After market research and a need to rebrand, they are now looking tochange their target market and category of housing to expand in to the hospitalitybusiness.

They are to re-open as a Hostel providing accommodation to travelers.Target MarketTheir target market previously were femalestudents in nearby universities and institutions. Current market shall be millennialtravelers in need of affordable accommodation traveling through or within thecountry. Barons Hostel shall focus on Segmented Marketing approach where weshall market our products to the already targeted market but with variations inthe product to suite each of the various preferences. We shall also consider DiversifyMarketing where we shall market our individual services with a slightly differentapproach to the needs met. Key Partners Strategic alliances: Nairobi National Park, Giraffe Center, Karen Blixen Museum, Elephant Orphanage and Rolf’s Place. The mentioned are tourist’s attractions located in Barons Hostel neighboring surroundings. We shall market them in our hostels and guests are given discount prices to visit each of the above if they book with us in a group of more than 3 and the above shall market our hostel on their website.

Buyer-Supplier relationships: We maintain relationships with big organizations such garbage collection and disposal companies that in turn enable garbage disposal for the entire neighborhood. We are big on supporting local businesses and acquire necessities such as milk, eggs and any other farm produce from local farmers who can distribute their produce in large quantities and consistently. This gives us a relationship with our neighboring businesses. Co-opetition: Barons Hostel is big on preservation of the environment and energy: agreement with nearby businesses to outsource water from neighbors with boreholes and to invest in solar energy that can be distributed to the entire neighborhood or to those interested in acquiring solar power both as businesses and household entities. Key Activities Front line Management Receptionist – the receptionist oversees receiving of guests and handling bookings made prior to or on arrival. Accountant – the accountant shall oversee receiving payments that are made on arrival, handling all cash transactions as well as updating guest information on payments accessible by the receptionist who manages check ins and check outs.

Back office Management Customer Service Desk – the customer service is there to help guests with any questions they have regarding booking and accommodation and assist them in any way possible across the different online platforms. The Customer service desk updates the online platforms with current news regarding the accommodation and oversees issuing, designing questionnaires and surveys to the guests, issuing them, compiling the results and suggesting methods of improvements.   General Manager – the general manager supervises the staff and assures everything is done on time and to precision. He assures work flow is current and consistent and handles and troubles or complaints by the guests when available staff are not able to.   Key resources Physical Resources: Furniture in dining, common areas, workspace rooms, setting up of a bar and restaurant within the property, kitchen appliances, cutlery, computers for employees, art work, refurbishing and construction of new buildings, plants, growing of more trees and flowers Intellectual Resources: Brand identification, partnerships with neighboring business, customer and employee database, Websites Human Resource: Accountant, receptionist, manager, customer service representative, cleaners, constructors, gardeners, security, chefs, bar man and waiters/waitress Financial Resources: initial investments, bank loan, investors, insurance, legal licenses, credit and debit card handlers Value Propositions What value is delivered to which markets? Barons Hostel is Targeting both male and female travelers looking for affordable accommodation for their short or long stay. They have a website that is consistently updated with a gallery and specification of the accommodations available including the prices, activities and resources at their disposal.

The guests can then book beforehand or choose to pay for the rooms on arrival. The website indicates which rooms are available and which ones are occupied. Shared rooms offer privacy to each guest because the bunk beds are in cubicles with curtains. The hostel assures high security within the compound and as much as possible guarantees and reminds guests to keep their valuables secure. We offer in house storage in form of lockers secured by the receptionist for valuables such as cameras, laptops, jewelry and any form of expensive possession, which in turn the guest receives a key to. However, we encourage passports, credit cards and money to be kept safely by each guest. We are respectable of female solo travelers and promote respect among all guests to each other and their possessions. We offer male and female only rooms for those not comfortable in open sharing.

Bookings made in a group of 3 or more enables discounts on certain activities such as game drives and park tours in Nairobi National Park.   Customer Relationships Communication Strategy Phone, Emails, Social Media, Website pop up chats Customer service Dedicated Personal Assistance to every customer that needs help or has any questions regarding making a booking, accommodation provided or using the website. Use of social media platforms to understand our guests as well as create a Community where the guests can interact with each other and the Hostel to provide insights, leave reviews and comments and share experiences in the Hostel. Automated Service on the website by having a customer create a profile and log in to their account to have the best filtered results based on their interests and purpose of stay.   Channels of Communication and Management Barons Hostel channels: website, mail, phone Customer Segments Digital information Segmented ad Diversified Customer Targets. This shall be acquired by specifically targeting millennial travelers through social media channels as well as separately marketing the services Barons Hostel offers (double rooms, shared rooms, male only and female only rooms) to the market. Every need that shall be met by both male and female travelers and couples who need accommodation.   Logistics (location, target market) The Hostel is in the suburb of Karen with tourist attractions in its immediate surroundings that are frequented by travelers.

As our main target is both male and female travelers, we offer travelers of groups: more than 3, discount prices on park fees and game drivers through a partnership with the National Parks in the area.   Cost structure What costs are involved in delivering that value? Barons Hostel is value driven Fixed Costs: renovations, purchase of items needed: furniture, cutlery etc., solar panels, monthly salaries Variable Costs: maintenance of the hostel, water Economies of scale and scope: economies of scale are achieved by purchasing goods in large scale from neighboring businesses and farmers to save on costs. Economies of scope is achieved because all resources in the hostel are shared resources among every guest which they purchase.

  Revenue Streams Where are the revenues coming from? Usage fee, renting, advertising, brokerage fees  Ifyou suggest changes to the current business model – what would they be?The current business model cannot beachieved immediately. It entails a heavy financial plan and it would be a goodidea to spread it out between a couple of years. I would suggest startingsmall. The hostel could first start with a couple of rooms to test the marketand its ideas and if positive results and acquired profits, it could thenexpand and have more rooms available.  Whatwould you anticipate the effect of the above changes to be? I.e. benefits,targets etcThe changesshall reduce the initial costs to be incurred in the Physical and HumanResources, it shall enable testing of relationships between alliances formedand shall be able to make changes and adjustments effectively without incurringa huge loss to the business.

It shall also be able to hire qualified staff andenable training to assure they diligently perform their duties and aretrustworthy. If this succeeds, as they expand, they shall have trained andhonest employees.