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Micro And Macro Environment Factors

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Discuss the micro environment factors and macro environment factors.


Sofitel hotel: overview

The main aim of the assignment is to analyze the external and internal factors that affect the market and business of Sofitel hotel in Australia. Micro environment factors include customer’s analysis, company analysis and competitor analysis while macro environment factors include analyzing the economic conditions, technology and demography of Australia that affects the business. Basically macro environment analysis is the external analysis and micro environment analysis is the internal factors that affect the business. Sofitel hotel is the only French luxury in Australia that has its branches in many cities and countries. It is a five star hotel that is located in many cities of Australia such as Brisbane, Melbourne, Sydney, and Gold coast (AccorHotels Australia, 2016). 

Micro environment factors

Customer analysis:

Sofitel hotel in Australia mainly targets luxury and high class people from not only Australia but all over the world. Since it is a five star hotel and fare of the rooms and the service are expensive normal middle class people cannot afford to stay. So the main target audience of the hotel is the high income luxury class people who are ready to spend to get high quality customer service. Sofitel hotel believes in providing high quality service to its customers so that it can create a brand trust in international market. The main target audience is the tourists from all over the world. The main customers of the hotel are luxury travelers (Hollensen, 2015).

Company overview:

Sofitel hotel is a French hotel under the Accor group of company. It is a luxury five star hotel that is spread across forty countries. All the Sofitel hotels represent French beauty and tradition. In Australia there are many branches of Sofitel hotel across cities. It has its branches spread over Brisbane, Sydney, Melbourne and City of Gold coast (Wentworth, 2016)

Competitor analysis:

The main threat of the Accor group of company or the Sofitel hotel in Australia is from its competitors. The competitors of the Sofitel group are very smart and are very famous worldwide. Some of the famous competitors of the Sofitel hotel are Starwood, Marriott, Hyatt and Hilton hotels that are at equal par with Sofitel hotel. The competitors of the Sofitel hotel compete in terms of price, service, facilities that they provide and costs. The number of competitors is on rise with new entrants constantly entering the market. The demand for spending in luxury and vacation is rising which is making the new hotels enter the market that possess a threat and competition to the already existing hotels. The competitors of Sofitel hotel are very price sensitive and quickly respond to price changes when they see that the competition is on rise (Erel et al. 2012).

Macro environment factors:  

Economic factors:

There are many economic factors that may affect the market and business for Sofitel hotel in Australia. If the government increases the luxury tax or the tax on travel in Australia then fewer tourists will visit Australia. The demand for a stay in Sofitel hotel will fall decreasing the profit. Though the economic conditions of Australia are stable still a small change in economic conditions affects the profit of the hotel. The economic factors greatly affect the demand, costs, prices and profits of the hotel. The other economic factors that may affect Sofitel hotel are mergers and acquisitions of the firm. The profit of Sofitel hotel is increasing and is expected to grow in future (Skokic et al. 2016).

Technological factors:

Technological factors are the major macro environmental factors that affect the business and the customers both. Sofitel hotel uses the technology to attract more customers from all over the world and provide good and high quality service to its customers. The Accor hotel group uses technologies such as websites for hotel booking and provides information to its customers. It also uses electronic media card or pre paid card to make the payment more convenient and easy. Basically internet and other technologies do affect the market of the hotel (Skokic et al. 2016).

Demographical and socio cultural factors:

Various socio cultural factors such as demography and lifestyle affect the business. Demographic changes such as sex, gender, age, population and lifestyle greatly affects the business. It’s not only the customers that affect matters to the hotel bit its employees also play important role.  The company believes that women and men are the heart of the strategy. Other factors such as health and culture also affect the business. If the income of the consumers falls then the demand for the luxury brand hotel will also fall (Skokic et al. 2016).

Political factors:

Political factors and government also affects the business of hotel. The Australian government supports the working of the hotel group in Australia to increase the number of tourists that visits Australia. The political stability is essential for nay business to flourish. If a country is politically unstable then the tourists will not be willing to visit the lace that will affect the profitability of the firm (Skokic et al. 2016).



AccorHotels Australia. (2016). Sofitel. [online] Available at: [Accessed 22 May 2016].

Erel, I., Julio, B., Kim, W. and Weisbach, M.S., 2012. Macroeconomic conditions and capital raising. Review of Financial Studies, 25(2), pp.341-376.

Hollensen, S., 2015. Marketing management: A relationship approach. Pearson Education.

McManus, L., 2013. Customer accounting and marketing performance measures in the hotel industry: Evidence from Australia. International Journal of Hospitality Management, 33, pp.140-152.

Skokic, V., Lynch, P. and Morrison, A., 2016. Hotel entrepreneurship in a turbulent environment. International Journal of Hospitality Management, 53, pp.1-11.

Wentworth, S. (2016). Luxury hotel SYDNEY - Sofitel Sydney Wentworth. [online] Available at: [Accessed 22 May 2016].

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