A case Study on Club Med- Presentation- Marketing Management- Price Promotion- 4P's

1. Club Med

2. History
The Club was started in 1950 by Belgian entrepreneur Gérard Blitz. Blitz had opened a low-priced
summer colony of tents on the Spanish island of Majorca. Gilbert Trigano supplied the tents, and in
1953 Blitz wooed him into a partnership. The first official Club Med was built the next year in Palinuro,
Salerno Italy.
In 1961, the company was purchased by the 35-year-old Baron Edmond de Rothschild after he had
visited a resort and enjoyed his stay. With Rothschild financing, the number of villages increased
greatly under Trigano's leadership from 1963 to 1993. Winter villages, providing skiing and winter
sports tuition, were introduced in 1956 at Leysin, Switzerland.
In the 1990s, the Club's fortunes declined because competitors copied its concepts and holidaymakers
demanded more sophisticated offerings. Serge Trigano took over from his father but was replaced in
1997 by Philippe Bourguignon, former CEO of EuroDisney.
In 2004, the hotel group Accor became the largest shareholder, but it sold most of its stake in 2006,
announcing that it wished to refocus on its core businesses. From 2001 onward, the resort company
worked to rebrand itself as upscale and family-oriented. In 2006 and 2007, Club Med and its partners
dedicated a total of $530 million to renovate several resorts.
In February 2015, Fosun International Ltd.'s Gaillon Invest II and The Silverfern Group finalized a
takeover deal of Club Méditerranée S.A

3. Club med founded in 1950 had an objective of offering holidays to
customers with an innovative “all inclusive” formula and the core concept
behind this was the idea of happiness. Club med had revolutionized
holidays with its all inclusive formula.
ALL INCLUSIVE PACKAGE : what’s included?
• Accommodation.
• Entertainment,
• Sports and
• Supervision for children and teenagers (depending on the Resort).
• Catering and bars: meals, snacks, drinks (except champagnes,
VSOP and XO alcohols, alcohol bottles, and some premium brands
which are extra.)

4. In 1967, Club Med created the first mini clubs for children.
• Baby Club Med® (4 to 23 months old)
At Baby Club Med®*, little ones from 4 to 23 months-old are pampered, cared for and
stimulated. The number of places is limited to ensure their safety and well-being.
• Petit Club Med® ( 2 to 3 years)
Created for 2 to 3 year-olds, Petit Club Med®* is a fun reassuring space that offers your children
the perfect balance between exploration activities and rest. They can paint, try gymnastics, dress
up, take part in shows and invite you on a treasure hunt.
• Mini Club Med (4 to 10 years)
Mini-Club Med® is suited to all types of kids from 4 to 10 years of age. Kids can take part in a
wide range of activities such as flying trapeze, waterskiing, sailing, artistic and musical
workshops, crafts, horse-riding, music, snowboard and exploring the natural environment.
As for kids of age 11-17, club med offers them high dose of freedom and the extremely
happening Passworld, where they can take part in music mixing, theatre and dance, Art and craft,
Sports, Excursions etc.

5. Club med’s fundamental culture lies in the notion of freedom and equality. At the
time of it’s creation, the company aimed to give people a sense of freedom through
nature and sports that allowed them to be happy and one with the others.
At that time, in the holiday villages, instead of money, the customers were given
bead necklaces, that allowed them to pay for their drinks.
Big tables allowed customers to share their meals and get acquainted with each
other.
Since its creation club med has never ceased to innovate. New and unknown
destinations were added to the portfolio-
• Tahiti in 1955
• Leyen in Switzerland in 1956
• Mangaratiba, Brazil in 2016
• Sao Paulo, Brazil 2016
• Lombok, Indonesia in 2019

6. PROBLEM FOLLOWED BY OLD METHOD
• Club med was highly successful between the year 1950 and 1990, the idea of
holiday small town has no competition until 19990s.
• But the good things of club med turned to be element of the failure post 1990
• New aggressive rivals like Marmara, Nouvelles Frontiers etc had imitated the
idea of the club med and even offered the packages for lesser monetary values.
• Club med distinction was no longer believable.
• Therefore, club med has suffered a strategic impetus: the strength of the club
med became the weakness and lost control on the environment
Reasons:
• The founding member of the club med are still in the administrative power, they
are former small town general managers
• All the embodied club med’s historical civilization and it is hard for them to
adopt to change.
• The community life civilization and relaxed ethical motives were no longer in line
with societal context.

7. PROBLEM FOLLOWED BY OLD METHOD
• Club med has appointed Philippe Bourguignon as the C E O of the group in 1997,
under his leadership the club med has changed the direction towards modification.
• He proposed a recover plan In 3 years by cost cutting and waste management.
• In 2000 the diversification continued with the creation of the club med world to
Paris-Bercy, to create a place in the city center which allies business, pleasure and
entertainment.
• Club med has acquired Gymnasium club in 2001 .
Failure:
• Even with all the modernization The new modifications failed to improve Club med.
• Bourguignon has focused on the selling and direction control more than brand
positioning or retaining.
• He Neglected the cultural facets, due to which the employees never shared his
vision.
• The competitor environment worsened after the terrorist attack 9/11.

8. New Value Strategy

9. New Value Strategy
Redirected value strategy to target international clients.
Club Med launched a number of major projects to accelerate the implementation of
its strategy
The holiday package offer was repositioned with the closure of entry-level
vacation villages.

10. New Value Strategy
Renovation of Villages in 4 trident to 5 trident
Created new range of luxury.
Offers an all-inclusive premium with a high range
of services.
All clubs offer a spa in partnership with a famous
brand

11. New Value Strategy
Dedicated spaces for children.
Sports schools offer up to 10 disciplines.
For 5 trident resorts, it chooses sites in the most beautiful
destinations.
The services are high-end with all-day room service, a
concierge service and champagne.

12. New Value Strategy
Club Med digital bracelet or Club Med Pass will allow
you to pay for services at extra cost.
Evening entertainment including live bands, kids /
family shows, DJ sets / music and acrobatic
performances.

13. IMPACT OF REPOSITIONING

14. This repositioning was made to release itself from the
image conveyed by the famous French movie "Les
Bronzés" which sent back to a downmarket or average
range offer for a excessive price.
Club Med manages to raise its margins, and to improve
appreciably its bottom line results.
Helped the exceptional profit, but also amputated by 5 of
its villages among the most profitable, destroyed by
Tsunami, and at present in renovation.

15. The positioning of Club Med’s resorts, from 3 trident to 5
trident, allows for a broader coverage of the competition
field—from standardization, and luxury services to all-
inclusive offers. No other company offers this.
Club Med turns holidays into a one-of-a-kind experience.
Price penetration on growing exotic destination.
Concept was copied by the competitors and now is the
benchmark of Industry.

16. CUSTOMER RELATIONSHIP MANAGEMENT OF CLUB MED
Marketing execution happened in two layers like by Showing image of friendly
upscale holiday to appeal most to the customers and also by Providing individual
attention and choice.
And also they set up high level pricing to convey an image of prestige, quality, and
exclusivity.
Excellence in Quality Service to their customers. Their main Core product was their
customer’s Happy experience •
Developed relationship with the customer by many approaches such as
◦ Personal interaction
◦ Personalized marketing like Vacation choices that fit desired budget. From Flexible
accommodation and transportation services and room categories, comfort level, flight times,
class of travel, choice of airline to every thing.
Excellence in Quality Service

17. CUSTOMER RELATIONSHIP MANAGEMENT OF CLUB MED
Staff Management to pilot change
◦ High rate of staff loyalty
◦ Focus on its staff training and appraisal mechanism
◦ Values: multicultural, pioneering, friendliness, freedom, and responsibility Fast and timely using
technologies – Attractive, easy-to-understand, and well designed official website.
◦ Fast and timely using technologies they achieved attractive, easy-to-understand, and well designed
official website
The organization’s customer relationship has also evolved through the development of customer
relationship management tools for a finer segmentation of customers. In some agencies, a concept
of sale side-by-side has been developed to allow clients to customize their holiday packages along
with the sellers.
The focus on a globalized customer strategy helped Club Med grow and ensured its unique
positioning in the market.

18. “What's your idea of happiness?” campaign
The campaign is brought to life through 16 visual metaphors and invites everyone to imagine their own
happiness through a new tagline. This campaign has been deployed in 47 countries and in 22 languages.
The brand is engaging valuable customer communities by revealing the campaign through fresh tactics from
media blitzes in key markets to intimate events for top clients and brand ambassadors.
As the campaign asks the question, "And What's Your Idea of Happiness?", Club Med is inviting guests and
fans to share their ideas of happiness and see what other have shared on our wall of happiness
The campaign will additionally be brought to life through social media initiatives increasing the virality of the
campaign.
In 1950, Club Med was built on the vision of its two founders, Gerard Blitz and Gilbert Trigano, saying, "The
goal of life is to be happy. The time to be happy is now. And the place to be happy is here." And today,
through the new campaign, Club Med maintains this vision.
This creative approach enables Club Med to update all the values that form the brand's DNA,
while helping guests to fulfill their own ideas of happiness through a unique Club Med vacation and
experience.“

19. ADVERTISEMENT STRATEGIES OF CLUB MED
New Growth Strategy: closed all unprofitable villages, some sales offices and refurbished older resorts. The
company continued this strategy. The company also entered many strategic alliances with global firms such as
match.com to promote the sale of its vacation packages.
Branding and Positioning: Club Med also made huge changes to its positioning in the marketplace and its
brand. The company took on a more upscale position with substantial remodeling and design efforts. It
invested over $350 million from 1998 to 2004 in advertising to re-brand itself as more family-oriented and
luxurious.
Changing Market Segments: Sales and marketing efforts have taken a change in focus.
Advertising & Club Med The ‘My Val Thorens’ Facebook page. It was the largest Facebook campaign launched
by Club Med to date. Facebook is the platform with the largest number of users in the world, and it is the one
that gathers the most fans and generates the most conversations. It is also using Twitter and Instagram to
promote the app by posting publications. Club Med’s ad strategy has been successful in Interactive Marketing
in Social Media Catering to Customer Requirements has been instrumental in designing& managing of Club
Med Services
Superior Service Delivery has been employed for gauging customer demands and incorporating self-service
Customer Segmentation and use of Catchy Slogans have resulted in Club Med’s profitability.

20. Product Strategy
• Club med is an innovative all-inclusive holidays for traveler/family to
relax and enjoys carefree getaway and unique experiences with their
loved ones.
• Ensuring consistent service delivery and determining the training need
of the staffs as well as area of customisation to deliver delights to
customers.
• It is today the only world brand that offers all inclusive premium and
multicultural vacations for families and couples.
• New activities as the mini club, the school of circus, the sporting
trainings and the spa and one packages "club med and spa ".
• They launched some innovative and attractive options like the "total all
inclusive“ in the united states to relaunch the american market and the
booking bonus.

21. With respect to product mix ,
Club Med should cut less its market development under Alps and add more island and
resort in the Asia category
By concerntrating in these region , it will have future economic growth because these
region will have people with high spending power and travel in the future
Thereby it can increase its market share and sales profit
Clubmed is in its up-market stretch with more growth and higher margin.
Successful branding focus on building relationships
Successful brand seize extraordinary oppurtunities created by social and economic change
Successful branding efforts allow both personalization and economies of sales.
Product Stratergy

22. Pricing Stratergy
All-inclusive pricing would be mentioned here
Charging fees could avoid as many financial decisions as possible
Value perception is more important
TACTICS 1
Prestige pricing strategy; this strategy is mostly used in Club Med’s section
of “luxury by Club Med”.
TACTICS 2
Value based pricing which involves the psychology of pricing
The above example also mentions the third usual pricing strategy which is captive
pricing which set a low entry price to attract potential customers.

23. POSITION
They launched some innovative and
attractive options like “Total all
inclusive”
Club med offer booking bonous.
The launching of agreements with
partnerships.

24. PROMOTION
The global campaign encourages consumers to
actively visualise and seek the “holiday of their
imagination”
The outdoor advertising campaign in the UK is
targeting commuters with digital escalator
panels at key rail stations including Euston,
Liverpool Street, Paddington and Waterloo
stations.

25. CHANGES MADE
Global Corporations such as Club Med lose a sense of brand identity and
promotional efforts are lost in translation when not uniformly executed.
Because of weak advertising campaigns, many came to associate the Club
Med name with rundown properties, mediocre food and amenities and
some came to regard the friendly atmosphere as a “swinger’s paradise.”
Branding and Positioning: Club Med also made huge changes to its
positioning in the marketplace and its brand.
Changing Market Segments: Sales and marketing efforts have taken a
change in focus.
Expansion:After many facing failures to enter into new places clubmed
company attempted to develop a strong brand

26. QUESTIONS AND ANSWERS IN THE CASE STUDY

27. HOW DID CLUB MED REACH AN UPSCALE POSITIONING
AND ACHIEVE EXCELLENCE IN THE QUALITY OF SERVICE?
BRAND POSITIONING:
Focus on branding and analyzing the evolution of the potential
customer is a key element to survive.
• Fundamentally revamping its operations
• Repositioning to target an international clientele wanting
comfort, elegance, service and customization.
• Decided to close down its 2 trident, renovate 4 trident and
create 5 trident villages
• Reinforce new image

28. WAS CLUB MED’S UPMARKET POSITIONING THE
ONLY VIABLE STRATEGY? WHY?
Upmarket positioning is the only viable strategy for club med
because:
A luxurious customer must feel he or she is getting
something truly special.
If not, A Luxurious customer loses the value of uniqueness.

29. DO YOU THINK CLUB MED TAKES A RISK BY NOT
SPECIALIZING IN A PARTICULAR RANGE LEVEL SUCH AS 4
TRIDENT OR 5 TRIDENT?
YES.
Club med implemented exceptional upscale move to meet
its customers’ new requirements.
This strategy is expressed by a vast village renovation
program and refocusing of its activity on 4 trident and 5
trident.

30. CONCLUSION
Club Med, established in 1950 is among the first world developers of vacation villages.
Revolutionised the concept of holiday.
72 resorts in 30 countries.
Always Innovative – adopted value strategy
Re-branding and Re-positioning
Fosun Group tookover.