Club Mediterranee - A holiday company on the road to recovery?

Seminar paper from the year 2010 in the subject Business economics - Business Management, Corporate Governance, printed single-sided, grade: 1,0, Ashcroft International Business School Cambridge, course: Strategic Management, language: English, abstract: The following assignment is to undertake a strategic analysis of the French package holiday company Club Méditerranée, or as it will be mentioned by its more common name in this report, Club Med. Moreover, this report will investigate whether or not Club Med is able to recover from their shrinking profitability of the last decade and turn the company back into what it used to be the market leader in the all-inclusive industry. Club Med is the original founder of the so called all-inclusive holiday concept (Club Méditerranée, 2010). Since its foundation in 1950 by the former Belgian water polo champion Gerard Blitz, the corporation has set out to become the largest organization in its industry, becoming a Public limited company along the way in 1963. As mentioned on the previous page, the former CEO of Club Med, Philippe Bourguignon, once described the company s ultimate objective as bringing happiness to its customers. Nowadays, Club Med has 75 villages on five different continents and hence, operates in 40 countries. This worldwide expansion of Club Med is one staggering sign that the matured all-inclusive holiday industry seems to have enough demand in order to be profitable. Especially since the worldwide financial crisis hit in 2007/2008, consumers want the ability of controlling their budgets in times of an economic downturn. As a result, statistics show an increase in demand for all-inclusive holidays in the last couple of years. According to figures of the Travelweekly homepage in 2009, more than one quarter of customers decided to book all-inclusive. However, since the all-inclusive industry has evolved into an immeasurably diversified sector (Travelweekly, 2010), specific boundaries have to be set to Club Med s industry in order to undertake a reliable strategic analysis. Hence, the industry in which Club Med operates in can be defined as worldwide, year-round, all-inclusive holiday (Club Méditerranée, 2010). Furthermore, all analytical models in this report will focus on the worldwide, year-round, all-inclusive holiday industry.