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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
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:
o What is the point of the document? Make sure you have a purpose when writing
• 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
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
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
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).
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).
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
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).
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).
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.
•Based on the
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).
On the other hand, some groups such his core of political supporters view this
confrontational stance as positive. During an interview with The Harvard Business
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.
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.
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.
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).
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.
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.
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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