MARRIOTT HOTELS

The Marriott hotel empire started out in 1927 as a mere rootbeer stand in Washington, D.C. by John Marriott of Utah (Goldwasser, 1986, p. 55). It then expanded into a full restaurant and eventually developed into a chain of restaurants called Hot Shoppes. Hot Shoppes specialized in tamales and chili con carne. Its next step diversification was in the field of airline catering in 1937. Twenty years after that, however, came its major move into hotels. The first hotel was opened in Arlington, Virgina. In 1964, Marriott's son Bill became president of the company, heading a conglomerate of four hotels, forty-five Shoppes and an airline catering division with sales of $45 million.

Between 1964 and 1971, Marriott added ten more hotels, expanded airline catering into Europe and South America, acquired the Bob's Big Boy restaurant chain as well as the Farrell's Ice Cream Parlor chain, and established the Roy Rogers Roast Beef Restaurant chain. Their investments expanded into other aspects through the purchase of the Greek cruise line Oceanic and a 45% interest in the Sun cruise line (Hoover handbook of American Business, p. 378). In 1972, Marriott opened two Great America theme parks which proved to be unsuccessful (p. 378). In the 1980s, the company sold one of the theme parks and was forced to discontinue the other.

As of 1977, corporate sales exceeded one billion dollars, covering 1,335 restaurant units, 34 full service hote

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tage who had stayed at a Marriott hotel in the previous year went from 47 to 70 percent, while the rate for Holiday Inn dropped from 48 to 32 percent. As illustrated by its discounting, Marriott conducts a rigorous marketing policy (Rice, pp. 101-02). Its Marriott Miles policy is conducted in cooperation with six different airlines frequent flyer programs. In addition, it has hotels and motels that cater to virtually all market segments--from the high end J. W. Marriott to the business class Marriott to the moderately priced Courtyard to the budget priced Fairfield Inns. Also, top management enforces strict quality standards on all its hotels and motels, keeping customer satisfaction in mind at all times. Thus, Marriott's marketing program is done highly competently and prudently and is well managed and coordinated. Weaknesses Marriott's aggressive expansion-oriented policies are agreeable in stable economic times like the 1980s, but it got the company in trouble in this recession of the 1990s (pp. 101-102). Playing the leveraged buyout, junk bond, acquisition game in the 1980s, Marriott expanded beyond its capacity resulting in excessive hotel space, depressed real estate holdings, and an unmanageable debt. Between 1

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