There has been some interests arised about the Juvet Hotel, which I have written about earlier in my blog site. I know that information are still limited on the net about Juvet, since it is not even opened yet. But as a small surprise, I can offer you every information available so far. The reason why I'm so concerned about it, is because my obligatory assignment is about the Juvet Hotel. I attend the Aalesund University College, for one semester as an exchange student. I am here from Hungary/the International Business School of Budapest. I managed to go to the Juvet Hotel two times, so far. Both of it is a memorable experience for me.
In the Services and Relationship marketing course, we got a task. The task was regarding the Juvet Hotel, which we visited in September. There we had an open conversation with Knut Slinning, the owner and founder of Juvet Hotel. Based on that talk, I wrote a full marketing paper about it along with my mates. Now, I would like to publish a short part of it, just to help you to get familiar with it. I believe, the SWOT analysis, the theory and recommendations won't be so necessary for you. :-)
Have a nice reading! ;-)
1. Tourism in Norway
First of all, we tried to conduct relevant information about the Norwegian Tourism, because it is a good start to see the whole sector in general. Therefore, it helps us to place the Juvet Hotel on the virtual map of Norwegian Hotel network. We found out, the growth of the traffic to Norway has been quiet strong until 1990 and the number of foreign hotel guests increased with 47% from 1989 until 1996. In this period Norway has increased its share of the market internationally. As of 2008, Norway ranks 17th in the World Economic Forum's Travel and Tourism Competitiveness Report. The 2008 report covers 130 countries. The index is a measurement of the factors that make it attractive to develop business in the travel and tourism industry of individual countries, rather than a measure of country attractiveness as a tourist destination. The report ranks selected nations according to the Travel and Tourism Competitiveness Index (TTCI), which scores from 1 to 6 the performance of a given country in each specific sub index. The overall index is made of three main sub indexes: (1) regulatory framework; (2) business environment and infrastructure; and (3) human, cultural, and natural resources.
The reasons for this strong trend are have relations with preferences in the markets which have promoted Norway, further with more goal-directed and more intensive market leading, as well as the improvement of quality and the development of new services. Experiences and recreation in the Norwegian nature are the most important reasons why foreign tourists travel to Norway. Tourists are attracted by the variable and local landscape with fjords and mountains. Overcrowded and polluted beaches in the south do not draw all tourists. Likewise are sun and beach holidays still the most popular tourism form for the people of Western Europe. Tourists do not come to Norway to experience sun and warmth. People from regions of big cities wish in a growing extend to experience something different. Fresh air, clear water and virgin nature have a great value for many people. This is also very true about business people, who spend a large proportion of their lives in busy city life, which goes in hand with the everyday great rush. Getting back to the point, there are special nature-experiences which attract tourist to travel to a place where mass tourism has not broke out yet.
The environment of Juvet Hotel
The location of the hotel is always an extremely crucial factor. It can influence the destiny of the business. There were many cases in the past, when we could see, the service of the hotel was above expectations, but they have chosen a very bad place for it. Indeed, the inconvenience of approaching the hotel has lead to the bankruptcy of the hotel. We think, the Juvet Hotel is located in a relatively good place, but this may also hide threats for the business, as well. Møre og Romsdal is a county in the northernmost part of Western Norway. The largest city in the county is Ålesund, with a population of 41,385 in the municipality and 45,299 in the agglomeration. Møre og Romsdal has a total of 36 municipalities. Norddal is a municipality in Møre og Romsdal county, Norway. It covers the easternmost part of the Sunnmøre region along the border with Upland County. Norddal covers an area with several distinct valleys and villages: Eidsdal, Norddal (Dalsbygda), Tafjord, Fjørå/Selboskarbygda, and Valldal, the administrative centre of the municipality. Norddal is a municipality that stretches over a considerable expanse of ground, but has relatively few inhabitants, numbering just under 2000. Much of the municipality is mountainous terrain, the ideal arena for outdoor pursuits such as mountain treks, fishing and hunting. Part of Norddal, which borders on the Geiranger fjord, has been submitted for approval for inscription in the upcoming list of World Heritage sites. More precisely, the Juvet Hotel is situated besides the Gudbrandsjuvet, which is a 5 metre narrow and 20–25 metre high ravine through which the Valldøla River forces itself. The ravine is easily accessible from main road route 63 between Valldal and Trollstigen, and now has safety fencing and a footbridge. The waters have formed a complex of deep potholes and intricate formations. The depth down from the surface of the water is about equal to the depth of ravine down to the river.
2. Situation Analysis
The Business Idea
Knut Slinning admits that the business idea is originated from Africa. When he was on a tour to a Safari programme, he was amazed by the closeness of the nature to the accommodation. Since it can be carried out in any environmental context, he started to think about emerging a similar one in the town where he lives, called Valldall. The only appropriate place he could found was an old farm with the name of Burtigarden. This is a historical ground, with old houses made from wood. In a perfect place, where tradition and nature meet. If this two exists in the same time, they can constitute the incomparable feeling which around was the Juvet Landscape Hotel built. Its buildings are also very unique because they have almost a greater history than the independent Norway. The farm house was built in 1870. The barn was added to it in the 1900’s and both of them had being restored after Knut Slinning’s took over.
Let’s go back to the point, where we mentioned about Knut’s experiences of the African Safari. Thus, Knut was attracted to Africa by the famous advertisement of the Big Five, which means if somebody would choose to spend his/her holiday in an African Resort close to the Safari, they would show him/her the five greatest animals, whereby Africa is matched with. This is a very efficient marketing strategy, it magnetize thousands of people a year to Africa, so why couldn’t it be useful in Norway, as well? The only important thing is to find five – or it doesn’t even matter how many exactly – attribute which would describe Norway in the best way. Knut believes he could find them which are the followings: mountains, water, wilderness, snow, and tradition. These elements constitute the Juvet Hotel’s Big Five. The marketing and the Juvet’s offered services will be built upon this Big Five. Moreover, the Hotel will offer a Spa service as well.
Knut Slinning is thinking about a different, and in a way, very strange concept. Instead of providing a free hand for every enquirer in booking, he would rather welcome a short holiday concept mostly not for individuals but for groups. He defined his target market to be the upper class people, mostly from one place in a period. In other words, he would rather provide services for a group of people coming together, because the programmes offered are highly depend on group activity. This would be perfect for team building, companies’ strategic level building and so forth. The reason of this target group have being chosen is that if several individual person come to Juvet Hotel, than the cohesion and co-operation of the people might will not be as successful as if the people have being known each other previously.
It is highly important to mention the accommodation as well, since it is very unique. Each room is a detached small independent house with one, or sometimes two of the walls constructed in glass. The landscape in which these rooms are placed is by most people considered spectacularly beautiful and varied and the topography allows a layout where no room looks at another. In this way every room gets its own surprising view of a dramatic piece of landscape, always changing with the weather and the time of the day and the season. These rooms are very similar to those ones which photographers use for nature capturing. Since the interior is dark, the brightness of the nature draws the attention outside the window. It is quite peaceful. The architect works were carried out by one of Norway’s most powerful and particular architecture office, called Jensen & Skodvin Arkitektkontor.
Information given
As for facts and figures, we can know a very few, since this is a private business. According to the latest information we got from Knut about the amount of investments, it is roughly 15 million Norwegian Kroners. Mainly everything was financed by Knut himself. Answering to the question which was about the sources of money invested, Knut admitted he had preferred the own sources. He didn’t want to involve banks and other companies into the project because he didn’t want to rely on anybody else. By doing so, he would get all the revenues - which are largely based on the money coming from the customers. Approximately it would be 70 percent of all the revenues. The holiday season would be tailored based on the weather conditions. Usually, in Norway, the winter lasts till May, so the holiday season would start in May till the end September. This is five months. But there is a speciality in this Juvet Holiday season. Juvet would only receive costumers for five days. After a group had been introduced to the Norwegian Big Five, Juvet would shut down its doors for a week in order to recover everything. For example, filling up the stocks, organizing the events and so on.
Furthermore, we can know something about the prices as well. Knut would like to get 5000 NOK per night. Every cabin has a double bed and there is 10 cabins, at all. So we can assume that there would be 20 person in one turn. Apart from its guests, Juvet can be a host place for events, as well. For example, wedding ceremonies and conferences. Up to 150 person.
What can the expenditures be? Knut Slinning is thinking about a very outrageous concept, because he wouldn’t have an own catering service but want to employ a company to handle it. This would help him to be elastic in the market field. He would not need to hire chefs, waiters and staff, in general for catering purposes. He states that it is still worth to him, because the prices offered by the catering company, are quite reasonable.
As for the target markets, we only know that Knut is focusing on the basic Norwegian Tourists market field. Namely, Western Europe (basically, Sweden and Germany), and the USA. People from these countries are more tend to afford travelling to Norway, however, there are more and more people from the other parts of the world, who can afford a holiday in the country of taxes.
First of all, we tried to conduct relevant information about the Norwegian Tourism, because it is a good start to see the whole sector in general. Therefore, it helps us to place the Juvet Hotel on the virtual map of Norwegian Hotel network. We found out, the growth of the traffic to Norway has been quiet strong until 1990 and the number of foreign hotel guests increased with 47% from 1989 until 1996. In this period Norway has increased its share of the market internationally. As of 2008, Norway ranks 17th in the World Economic Forum's Travel and Tourism Competitiveness Report. The 2008 report covers 130 countries. The index is a measurement of the factors that make it attractive to develop business in the travel and tourism industry of individual countries, rather than a measure of country attractiveness as a tourist destination. The report ranks selected nations according to the Travel and Tourism Competitiveness Index (TTCI), which scores from 1 to 6 the performance of a given country in each specific sub index. The overall index is made of three main sub indexes: (1) regulatory framework; (2) business environment and infrastructure; and (3) human, cultural, and natural resources.
The reasons for this strong trend are have relations with preferences in the markets which have promoted Norway, further with more goal-directed and more intensive market leading, as well as the improvement of quality and the development of new services. Experiences and recreation in the Norwegian nature are the most important reasons why foreign tourists travel to Norway. Tourists are attracted by the variable and local landscape with fjords and mountains. Overcrowded and polluted beaches in the south do not draw all tourists. Likewise are sun and beach holidays still the most popular tourism form for the people of Western Europe. Tourists do not come to Norway to experience sun and warmth. People from regions of big cities wish in a growing extend to experience something different. Fresh air, clear water and virgin nature have a great value for many people. This is also very true about business people, who spend a large proportion of their lives in busy city life, which goes in hand with the everyday great rush. Getting back to the point, there are special nature-experiences which attract tourist to travel to a place where mass tourism has not broke out yet.
The environment of Juvet Hotel
The location of the hotel is always an extremely crucial factor. It can influence the destiny of the business. There were many cases in the past, when we could see, the service of the hotel was above expectations, but they have chosen a very bad place for it. Indeed, the inconvenience of approaching the hotel has lead to the bankruptcy of the hotel. We think, the Juvet Hotel is located in a relatively good place, but this may also hide threats for the business, as well. Møre og Romsdal is a county in the northernmost part of Western Norway. The largest city in the county is Ålesund, with a population of 41,385 in the municipality and 45,299 in the agglomeration. Møre og Romsdal has a total of 36 municipalities. Norddal is a municipality in Møre og Romsdal county, Norway. It covers the easternmost part of the Sunnmøre region along the border with Upland County. Norddal covers an area with several distinct valleys and villages: Eidsdal, Norddal (Dalsbygda), Tafjord, Fjørå/Selboskarbygda, and Valldal, the administrative centre of the municipality. Norddal is a municipality that stretches over a considerable expanse of ground, but has relatively few inhabitants, numbering just under 2000. Much of the municipality is mountainous terrain, the ideal arena for outdoor pursuits such as mountain treks, fishing and hunting. Part of Norddal, which borders on the Geiranger fjord, has been submitted for approval for inscription in the upcoming list of World Heritage sites. More precisely, the Juvet Hotel is situated besides the Gudbrandsjuvet, which is a 5 metre narrow and 20–25 metre high ravine through which the Valldøla River forces itself. The ravine is easily accessible from main road route 63 between Valldal and Trollstigen, and now has safety fencing and a footbridge. The waters have formed a complex of deep potholes and intricate formations. The depth down from the surface of the water is about equal to the depth of ravine down to the river.
2. Situation Analysis
The Business Idea
Knut Slinning admits that the business idea is originated from Africa. When he was on a tour to a Safari programme, he was amazed by the closeness of the nature to the accommodation. Since it can be carried out in any environmental context, he started to think about emerging a similar one in the town where he lives, called Valldall. The only appropriate place he could found was an old farm with the name of Burtigarden. This is a historical ground, with old houses made from wood. In a perfect place, where tradition and nature meet. If this two exists in the same time, they can constitute the incomparable feeling which around was the Juvet Landscape Hotel built. Its buildings are also very unique because they have almost a greater history than the independent Norway. The farm house was built in 1870. The barn was added to it in the 1900’s and both of them had being restored after Knut Slinning’s took over.
Let’s go back to the point, where we mentioned about Knut’s experiences of the African Safari. Thus, Knut was attracted to Africa by the famous advertisement of the Big Five, which means if somebody would choose to spend his/her holiday in an African Resort close to the Safari, they would show him/her the five greatest animals, whereby Africa is matched with. This is a very efficient marketing strategy, it magnetize thousands of people a year to Africa, so why couldn’t it be useful in Norway, as well? The only important thing is to find five – or it doesn’t even matter how many exactly – attribute which would describe Norway in the best way. Knut believes he could find them which are the followings: mountains, water, wilderness, snow, and tradition. These elements constitute the Juvet Hotel’s Big Five. The marketing and the Juvet’s offered services will be built upon this Big Five. Moreover, the Hotel will offer a Spa service as well.
Knut Slinning is thinking about a different, and in a way, very strange concept. Instead of providing a free hand for every enquirer in booking, he would rather welcome a short holiday concept mostly not for individuals but for groups. He defined his target market to be the upper class people, mostly from one place in a period. In other words, he would rather provide services for a group of people coming together, because the programmes offered are highly depend on group activity. This would be perfect for team building, companies’ strategic level building and so forth. The reason of this target group have being chosen is that if several individual person come to Juvet Hotel, than the cohesion and co-operation of the people might will not be as successful as if the people have being known each other previously.
It is highly important to mention the accommodation as well, since it is very unique. Each room is a detached small independent house with one, or sometimes two of the walls constructed in glass. The landscape in which these rooms are placed is by most people considered spectacularly beautiful and varied and the topography allows a layout where no room looks at another. In this way every room gets its own surprising view of a dramatic piece of landscape, always changing with the weather and the time of the day and the season. These rooms are very similar to those ones which photographers use for nature capturing. Since the interior is dark, the brightness of the nature draws the attention outside the window. It is quite peaceful. The architect works were carried out by one of Norway’s most powerful and particular architecture office, called Jensen & Skodvin Arkitektkontor.
Information given
As for facts and figures, we can know a very few, since this is a private business. According to the latest information we got from Knut about the amount of investments, it is roughly 15 million Norwegian Kroners. Mainly everything was financed by Knut himself. Answering to the question which was about the sources of money invested, Knut admitted he had preferred the own sources. He didn’t want to involve banks and other companies into the project because he didn’t want to rely on anybody else. By doing so, he would get all the revenues - which are largely based on the money coming from the customers. Approximately it would be 70 percent of all the revenues. The holiday season would be tailored based on the weather conditions. Usually, in Norway, the winter lasts till May, so the holiday season would start in May till the end September. This is five months. But there is a speciality in this Juvet Holiday season. Juvet would only receive costumers for five days. After a group had been introduced to the Norwegian Big Five, Juvet would shut down its doors for a week in order to recover everything. For example, filling up the stocks, organizing the events and so on.
Furthermore, we can know something about the prices as well. Knut would like to get 5000 NOK per night. Every cabin has a double bed and there is 10 cabins, at all. So we can assume that there would be 20 person in one turn. Apart from its guests, Juvet can be a host place for events, as well. For example, wedding ceremonies and conferences. Up to 150 person.
What can the expenditures be? Knut Slinning is thinking about a very outrageous concept, because he wouldn’t have an own catering service but want to employ a company to handle it. This would help him to be elastic in the market field. He would not need to hire chefs, waiters and staff, in general for catering purposes. He states that it is still worth to him, because the prices offered by the catering company, are quite reasonable.
As for the target markets, we only know that Knut is focusing on the basic Norwegian Tourists market field. Namely, Western Europe (basically, Sweden and Germany), and the USA. People from these countries are more tend to afford travelling to Norway, however, there are more and more people from the other parts of the world, who can afford a holiday in the country of taxes.
Best wishes,
Joe
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