Boardroom report

Dear student,

Kindly take note that your assignment requirement is

slightly different from these sample assignments. The

content is not necessary accurate for you to use.

Please adhere to the assignment requirement,

guidelines and brief that stated in the Module Study

Guide – Brand Reputation Management. By looking at

this sample assignment, you will be able to

understand the structure and format for a boardroom

report.

Your tutor,

Sherine Kwok

16 March 2020

The University Of West London

The London Geller College of Hospitality and Tourism

MA Luxury Hospitality Management

TH70054E-Brand Reputation Management

Assignment 2: Boardroom Report

Word Count: 3175

Executive Summary

Missing! Should summarize the report

An executive summary provides an overview of the report and is usually the first thing your

reader will see.
The executive summary should address these main points:

• Purpose
o What is the point of the document? Make sure you have a purpose when writing

the summary.

• Introduction (company details and the threat)

• The Underperformed Reputation Drivers and Impacts to Stakeholders

• The Current Management Practice and Alternative Perspectives

• Conclusion and Recommendations for Alterations to Practices

Contents Page

Executive Summary

Introduction …………………………………………………P.1

Terms of Reference…………………………………………P.1

Section 1: Reputation Driver…………………………… P.2-8

1.1 Identification of the Primary Threat …………….P.2-4

1.2 Alternative Perspectives…………………………..P.5-8

Section 2: Potential Implications for Selected Stakeholder Groups…. P.9-10

2.1 Employees ……………………………………………P. 9

2.2 Wider Community and Suppliers………………….P.10

Section 3: Conclusion………………………………………P.11

Section 4: Key Recommendations for Alterations to Current Practice….P.11-12

Reference List…………………………………………………P.13-14

Introduction

Established in 1995, Trump Hotels is a lodging and hospitality management company

operating primarily in North America but also globally. The business initially launched

as a real estate company under the name Trump Hotels and Casinos (Tully et al.,

2016). However, by 1996, despite rapid expansion, the brand along with individual

hotels was struggling. Donald Trump re-branded the business; transforming it from an

asset rich real estate company to an asset light hospitality management one. The

company would now focus on the managing, franchising and licensing of hotels in

some of the most exclusive destinations and resorts in North America and around the

world.

Terms of Reference for the Measurement of Reputation

To accurately assess the impact of Donal Trumps’ personal association with the brand,

criteria for the measurement of brand reputation must first be defined. This report will

follow the framework of the RepTrak model developed in 2006 to identify and explore

the key reputation drivers behind a brand. Using this model, the report will consider

the primary threat to Trump Hotels, the effects on the stakeholder experiences as well

as considering the performance aspects of the business.

One of the key aspects that runs through the methodology of the RepTrak model is

trust. If the company has good leadership, good governance and good performance

then a bond of trust will form and grow. Therefore, the impact of Trumps association

on the elements that make up the trustworthiness of the Trump brand will be a

reputational barometer that will run throughout this report (RepTrak, 2018).

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Section 1: Reputation Driver

1.1 Identification of the Primary Threat

Analysis of recent online reviews on Tripadvisor of people that have stayed at The

Trump Hotels show that the hotels are still achieving similar levels of high ratings as

were being achieved before the 2016 election. For example, on average two of the

Trump flagship hotels in Las Vegas and Washington D.C are still achieving 4-4.5 star

ratings (Tuttle, 2017). This implies that the service, standards and level of luxury has

not declined since Trumps 2016 election victory; yet the hotels are consistently

dropping room rates sometimes by up to 67% (Smith, 2017) suggesting a substantial

drop in business and occupancy for the hotels. Further evidence of this fall in

customers can be seen in data produced from smartphones that indicates there has

been a similarly persistent drop in footfall across the whole Trump property portfolio

since the start of the election campaign (Fortune, 2016). This takes on a greater

significance when the footfall data from Trump Hotels is compared to that of nearby

competitors; all of whom report being fully booked (Fortune, 2016). Taking this data

together with the routinely high online reviews, it can be argued that the problem is not

an operational one; the hotels do not have poor hygiene or are offering bad service.

Based on this, it is reasonable to surmise that the problem for Trump Hotels is likely

to be one of brand image. Additional support for this theory can be found in research

conducted in April 2017 which found that 49% of people were less likely to use a

product with advocated by Trump while 29% told the pollsters that they would avoid a

trump associated product altogether (Torres-Spelliscy,2018).

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A possible explanation for a poor brand image of the Trump Brand comes from comparing the

demographics that his hotels are targeted at versus those who voted for him in 2016. As a

President Trump appeals to and was voted in by a core group of people known as ‘American

Preservationists’ (Bowman, 2017). This demographic is generally of a lower socio-economic

status typically associated with lower educational attainment along with lower disposable

income. In contrast the target demographic for Trump Hotels are those of high socio-economic

status, also known as the professional elite. Put simply, Trumps political base are not the

target market for his hotels. Compounding the problem further is growing evidence suggesting

that those within the higher income brackets are increasingly less likely to stay at his hotels

(Muther, 2016). The affluent demographic are “disproportionately turned off by his [political]

activities” according to Scott Galloway a marketing professor at The New York University

(Fortune, 2016).

The danger of this is that a schism is created in the three main elements considered critical

for the building and maintaining of a good corporate reputation. These elements, as defined

by Davies et al.,(1998), are as follows:

1) Identity – What the company says of its goals and values.

2) Desired identity- What the company defines itself as.

3) Image-What the customers and wider public think.

Based on the above elements an argument can be made that there is gap developing between

the identity/desired identity of Trump hotels and the image or actual identity that the company

now has. According to the Trump Hotel website (2018) the company lays claim to having some

of Americas’ most luxurious hotels among its collections and their mission statement ensures

guests of their hotels will experience “impeccable style, spectacular service, and luxurious

amenities”. The problem with this mission statement is that the company is having to cut room

rates automatically putting it at odds with a company pursuing a Luxury Strategy and business

model. As Kapferer et al., (2012) makes clear, in Luxury, brands should never discount as this

sows the seeds of doubt in the minds of customers as to the true worth of the product or

service; ultimately undermining and de-valuing the brand. Moreover, when it comes to luxury,

high prices are not only expected but actively desired by the consumers of luxury brands

(Kapferer et al., 2014).

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High or premium pricing when connected to luxury goods and services conjures up

feelings of exclusivity and status evoking guest aspirations, attachment and ultimately

trustworthiness (Yeoman et al.,2006). The apparent misalignment between the

desired identity of luxury and aspiration portrayed by Trump Hotels marketing and the

plummeting room rates and occupancy levels has the potential to severely effect a

company’s reputation (Chun, 2005).

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1.2 Alternative Perspectives

Due to the intangible nature of ‘reputation’ there are many theories as to how the

reputations of brands are constructed and subsequently maintained. Generally, it is

accepted that there are three levels the reputation of a brands (Roper et al., 2012):

Naturally, different people and demographics will place a different value on each of

these different levels however, as a whole the public construct a shared idea of a

company’s reputation based on a mix of these levels of reputation combined with

information given by the marketing and accounting signals of the company (Frombrun

et al., 1990).

The complex and intangible nature of reputation is further magnified when considering

the effects on a brand of the association of a personality. A possible explanation for

this is that the characteristics of different groups of people will influence what type of

reputation is considered to be desirable; thus shaping whether that group of people

view the association as positive or negative (Roper et al.,2012).

The relevance of this for Trump Hotels becomes more apparent when examined from

a social constructionist perspective. This is a theoretical perspective concerned with

morals and values suggesting that these social constructs fundamentally affect how a

company or practice is viewed by different sets of individuals. A social constructionists

view is that an individual’s perspective of the world is based on their values and beliefs.

Moreover, these values and beliefs act as a filter as to that individual will think and feel

about a company or brand. In this way, different groups of people, demographics and

cultures can view the same company or brand in very different ways. Put simply what

is acceptable to one group of people is unacceptable to another.

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Primary

•Constructed
through personal
experiences and
interactions with
the company

Secondary

•Based on the
experiences and
interactions of
friends or
relatives

Tertiary

•Formed thorugh
interactions with
marketing
communications
and media.

Exploration of this theory helps to crystallise the threat facing Trump Hotels. The

President’s controversial style and brand image while unacceptable to the current

target demographic for his Hotels, is not unacceptable for his core political voters such

as the American Preservationists (Bowman, 2017). Hence, another interpretation of

this demographical difference could be to view it as an opportunity for Trump Hotels

and Resorts to advance the management of the brand by re-branding itself for the

demographic for whom Trumps association is not a negative one.

An alternative theory on how the reputations of corporations are built is that of the

institutional perspective. This viewpoint suggests that as humans we are surrounded

by societal institutions that shape and influence us; these are not restricted to just

physical institutions such as universities but can also be legal and political institutions.

Integral to this theory is the idea of organisational legitimacy (Palazzo et al., 2006).

Although subjective, for an organisation to be remain legitimate it must act in a

desirable, appropriate and legal manner, conforming to societal norms. In recent

months, part of Donald Trump’s controversial presidency has brought him into direct

conflict with some of the established institutions within American Society. In March

2018 Trump lost his bid to have a lawsuit dismissed that alleges his ownership of

businesses, including Trump Hotels, as a sitting president is in violation of the US

Constitution (BBC, 2018). The significance of this is that the legal and appropriate

legitimacy of Trump Hotels is being challenged in full view of the public as a direct

result of the controversial association and ownership by President Trump whose own

conduct and legitimacy is being challenged (Greyser, 2009).

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On the other hand, some groups such his core of political supporters view this

confrontational stance as positive. During an interview with The Harvard

Review Professor Joan Williams (2016) concluded that Trumps ‘tell it like it is’ attitude

combined with his ability to connect with the working classes’ disenfranchisement with

the professional elite won him the 2016 election. Whilst this anti-establishment

personality might have made Trump President it has not increased the appeal of his

hotels amongst their target market, the professional elite, who appear to be

increasingly viewing his volatile behaviour as not only reckless but undermining the

very core of American values, democracy and the rule of law.

In summary, the problem facing Trump Hotels is a growing disconnect between the

demographic who support his controversial and confrontational presidential style and

the demographic whom his hotels are targeted.

One strategy that has been implemented by Trump Hotels was the removal of Trump

from the business in favour of his sons, Eric and Donald Trump Junior, the argument

for which is twofold. First, to avoid the potential legal ramifications a conflict of interest

between his presidency and business interests could cause. Secondly, to distance

Trump ‘The President’ from Trump ‘The Hotels’ in eyes of the public. However, despite

a sound rational the removal of Trump from the brand; it appears to have had little

impact on mitigating the negative associations that the Trump name is having. A

possible explanation is that, although a sound strategy in itself, it does not take into

account the fact that the brand and the president share the same name thus making

them intrinsically linked in the eyes of the stakeholders.

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These political and legal conflicts combined with falling room rates and occupancy

levels are sending negative signals to the market, customers and wider public.

Moreover, taken together these signals have the potential to undermine of the Trump

Hotels business legitimacy and brand equity significantly. From a signalling theory

perspective, considerable value is attached to the signals that a business sends out

along with the financial performance of the company, often taken as a signal in itself.

The signals given by a company or brand can be intended or unintended; they can

even be non-existent but the market, media and individual alike will all receive and

interpret these signals. Every action or practice that a company does sends out a

message that are used by receivers or stakeholders as a barometer of the likely quality

and behaviour or service to be expected (Devers et al. 2009). Based on this premise,

the signals currently being sent out by Trump indicate an in-hospitable service possibly

marred with discrimination and ultimately an un-trustworthy brand.

The fundamental element of signalling theory is that the various stakeholders of a

business such as customers, employees or the wider community take the signals and

uses them to build their view of the brand or company (Frombrun et al., 1990). If these

signals are conflicting, as is the case with Trump Hotels, or absent then it can be as

damaging for a company or a brand as if the signals were negative.

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Section 2: Potential Implications for Selected Stakeholder Groups

In addition to considering how Trumps’ association with Trump Hotels is effecting the

business from a customers’ perspective it can also be assessed by looking at the effect

on other stakeholder groups thus forming a holistic understanding of how Trumps’

association is driving the reputation of his Hotels.

2.1 Employees

Along with customers, employees are another significant stakeholder group for any

business. There is evidence that Trumps association is negatively affecting the

reputation of the brand among this stakeholders group as much as it is effecting the

target demographic of customers.

In April 2017 one of the restaurant chains located in some Trump Hotels announced

that it would be closing its’ flagship location, Trump SoHo since re-branded as The

Dominick Hotel. When interviewed for The Atlantic (Venook, 2017,) general manager

Suzanne Chou indicated that there had been a significant drop in business since

Trumps 2016 election victory; although she stopped short of making an explicit link

between the two. Furthermore, in 2015 two key restaurant deals with celebrity chefs,

Geoffrey Zakarian and José Andrés, fell through following Donald Trump’s

inflammatory comments on immigrants during the election campaign (Muther, 2016).

This is significant as it provides a categorical link between the political signals being

given out by Donald Trump and the effect on the Trump brand.

Another aspect to recognise when assessing the impact of Trump on this stakeholder

group of employees is the company’s ability to attract new employees. Since autumn

2016 Trump Hotels have been on the academic syllabus for Hospitality Management

classes at The Kent State University in Ohio as a case study (Muther, 2016). The

students assess what the association means for the brand from a brand perspective

as well as considering the practicalities of what the Trump name may mean on the

CVs of prospective employees. Senior Lecturer, Swathi Ravichandran, suggests that

the students are concerned what the Trump name on their CV could mean in the future

as they begin their careers in Hospitality (Muther, 2016).

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2.2 Wider Community and Suppliers

To comprehensively understand the possible effect of the Trump name on a young

hospitality student’s CV in the future it is necessary to explore what the Trump name

means within the context of the wider community.

In 2016 the release of the Access Hollywood tape in which Donald Trump can be heard

making sexist and abusive remarks about Women, attracted wide spread

condemnation from the global community as it was considered to be amounting to

bragging about sexual assault. Following the release of this tape, Shannon Coulter, a

marketing strategist from San Francisco, launched a Twitter campaign called

#Grabyourwallet (grabyourwallet, 2018) Crucially, the campaign advocates the

boycotting of not only the Trump brand itself but also any company, brand or supplier

with links to the Trump brand. At the start of 2018 there were 27 companies and

suppliers on the boycott list including the Trump Hotel and resorts brand itself as

merchandise stockists and big names including Amazon and Macys (Taylor, 2018).

The potential connotations of this becomes clear when considered in relation to

research that reports that 79% of Americans stated that they would avoid purchasing

goods and services from companies on political grounds. Even more similar research

conducted globally found that up to 90% of people globally would be prepared to

boycott a company or brand whose practices were deemed to be reckless or immoral

(Torres-Spelliscy, 2018). The implication of this for the wider community is significant

as any supplier of goods or services to Trump Hotels is now at risk of losing business

and share price down to their association with Trump.

Having weighed up the evidence of falling business and boycott campaigns linked to

a controversial owner who is attracting widespread criticism it is clear why young

hospitality students would think twice before choosing to work for a company with this

type of associations.

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Section 3: Conclusion

This report has been written to identify and assess the impact of Donald Trump on his

own Hotel Brand. Its analysis of current media articles in relation to academic journals

and key reputational theories and models indicate that Donald Trump is having a

significantly negative impact on his brand. This conclusion has been based on the

falling room rates, the undermining of brand trustworthiness linked to his controversial

presidency and legal challenges along with the impact on key stakeholder groups such

as employees and suppliers who are suffering the consequences of boycotts or are

simply choosing not to work for or with Donald Trump or his hotels.

Section 4: Key Recommendations for Alterations to Current Practice

In response to the analysis of the impact of President Trump on the Trump Hotel brand

and the subsequent conclusion, this report makes the following recommendations to

the current brand management practices:

1) The continued implementation re-branding.

With research suggesting that nearly 50% of consumers would be less likely to

purchase a product or service associated with President Trump (Torres-

Spelliscy, 2018) this report considers it vital for Trump Hotels to continue

distancing itself from the President. The process began with the removal of

Donald Trump from the day-to-day operations of the company in favour of sons

Eric and Donald Trump Junior. However, the report has identified the Trump

name, which both of his sons carry, as a key factor of the primary threat.

Therefore, this report recommends the removal of Eric and Donald Trump

Junior to be replaced by a non-family member who does not bear the Trump

name. This would begin to break the psychological link between the Trump

name, family and president and the Trump Hotels in the minds of the key

stakeholder groups discussed within this report.

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As a crucial part of the re-branding, the hotels should continue the removal and

re-naming of the Trump Hotels following the footprint of the Trump SoHo which

recently re-branded itself The Dominick Hotel.

2) A Change in target market.

The company should consider aiming some the North American hotels at the

same demographic who make up Trumps core political voters for whom the

brands association with the president would be a positive one. Although it is

acknowledged that this would mean those hotels having to drop room rates to

aim at a deluxe rather luxury market; they are having to cut room rates by up to

67% (Smith, 2017) anyway and are still suffering from falling occupancy rates

along with ongoing brand reputational damage.

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Reference List

Smith, O. (2017) ‘Room rates at Trump’s hotels have fallen by up to 63 per cent since he
became president’, The Telegraph ,20 November, Available
at: http://www.telegraph.co.uk/travel/news/trump-hotels-room-rates-fall/ (Accessed: Feb 2018)

Chun, R. (2005) ‘Corporate Reputation:Meaning and Measurement’, International Journal of
Management reviews, 7 (2), pp. 91-109

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2018).

Bowman, K (2017) Who were Donald Trump’s voters? Now we know. Available at:
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2018).

Muther, C. (2016) ‘Is Donald Trump’s campaign hurting his Hotel chain ‘, The Telegraph , 06
September 2016, Available at: https://www.bostonglobe.com/lifestyle/travel/2016/09/06/will-travelers-
spend-night-with-trump/zdK9glyYwcLCrFLW1rlpkJ/story.html (Accessed: Feb 2018).

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Kapferer, J-N., Klippert,C., and Leproux,L. (2014) ‘
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Yeoman, I., and McMahon-Beattie,U. (2006) ‘Luxury Markets and Premium Pricing’, Journal of
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Williams,J. (2016) ‘Why the white working class voted for Trump’. Interview with Joan C. Williams.
Interview by Curt Nickisch for The Harvard Review, 18 November , Available at:
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Tully, S. and Parloff, R. (2016) ‘ the Trump Way’, Fortune, Available
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Tuttle, B. (2017) ‘Trump Hotels Are Getting Hammered With Horrible Online Reviews ‘, Money
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Framework’, Journal of , 66 (1), pp.71-88

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Devers, C. et al., (2009) ‘A General Theory of Organizational Stigma’, Organization Sciencel, 20(1),
pp.154-171

Taylor, K. (2018) . An anti-Trump movement is calling for the boycott of these 27 retailers
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Torres-Spelliscy, c. (2018) ‘Boycotting The Presidents brand’, Corporate Reform Coalition, p 4-40

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