Case Study on Club Med

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1. Defining the Problem Club Mediterranee, otherwise known as “Club Med”, a corporation in the all-inclusive resort market, manages over 140 resort villages in Mediterranean, snow, island, and tropical locales in over 40 countries. It was originally founded by a group of travelers, headed Gerald Blitz, in 1950. However, through the years, as this group was increasing in size, it was becoming increasing more difficult to manage. Now, Club Med is making a comeback for this resort. There are some problems occur in Club Med. The first problem that occurs in Club Med is consumer’s preferences have changed. Club Med found out that its all-inclusive price is not as widely accepted today as it was in the past. Vacationers are not willing to spend large amounts of money for vacations that include many activities they are not using as much as they had been in the past. This change in preference poses a problem for the company because Club Med’s competition has been able to customize travel packages for each consumer at prices that vacationers feel more comfortable with. Besides that, another problem that occurs in Cub Med is competition. As of 1986, Club Med began facing competition. This company was no longer the only all-inclusive resort. Many of the firm’s competitors were realizing similar success. In 1986, most of the all-inclusive competitors had adopted Club Med’s style of recreational activities, with staff members acting as directors of these organized games. The only major difference that Club Med maintained was the fact that their price did not include drinks. At the start of the year 2004, after several years of listening to agents complain that vacationers were skeptical above booking Club Med resorts due to its exclusive prices, Club Med reverted to an all-inclusive deal and launched its “total” all-inclusive package in most of its villages. In the first

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