Peste Analysis

The PESTE analysis it is used to describe the Marketing Environment and it is based on several factors which are constantly changing. The changes affect consumers, drive the market demand and influence the competitive environment. The factors are the following ones:

● Political

The Political factors is important in terms that it is needed to establish legislation, laws, among others to assure a good organization of political environment and influencing the marketplace.

Regarding the Law nº292, Ley General de Turismo “Bolivia Te Espera”; approved by The Plurinational Legislative State; this one is the main law and the most important for tourism that has to be followed and respected. It is followed by the Law Nº 031 which is the one in charge of designing new propositions and defining tourist policies in regions, localities and departments.

Related to this law, has the responsibility of autonomic territorial entities respecting the establishment and development of “Sistema de Registro, Categorización and Certification” of tourist service providers and The Information System over the national tourist offer, demand

The payment of VAT is only applied to these employees who earn more than 8,272 Bs which is a percentage of 13%.

According to pwc Worldwide Tax Summaries; “corporations make payments to individuals in relation to the acquisition of goods or service providers subject to withholding taxes of 8%

(goods) and 15,5% (services)”. Then, the “beneficial withholding taxes rates on dividend distributions are provided by double tax treaties with Spain and Sweden at 10% and 0% which it is demonstrated that Spanish or Swedish company is the ultimate beneficial owner and holds more than 25% interest in the Bolivian company”. Following up, the “tax on gross income from the performance of any economic or commercial activity are at a rate of 3% monthly basis”.

Regarding Boleto & Terrero Law Firm, there are regulations on advertising and marketing communications which are directed to the telecommunications sector (Law 164). But, there is nothing regarding the processing requirements of data either rules and still it is needed the consent of the owner of the information to transfer or disclosure the data to a third party. On the contrary, Privacy Data regulations have some protection and it is possible to get some compensation for the damages suffered even though a consequential showing of the damage is required.

● Economic

As Transformation Index BTI states there are several reports that has been done in 2018. Reports refer on political and economic transformation. An example of Economic Transformation is the following:

Table 13. Economic transformation, economic indicators

The Business Cycle is another important aspect that have major impact on demand. This business cycle is formed by five different stages that are relevant on the economic activity. First, the growth refers to increasement of demand as well as high business confidence hoteliers might have. Related to the tourist activity it has created new job positions and contributed to the development of many regions. So, the tourist activity as for example, in the hotel sector; has increased and consequently the visitors are more than the previous year, the tourist expenses

Source: The World Bank, world development indicators | International monetary fund (IMF), World economic outlook | Stockholm International Peace Research Institute (SIPRI), Military Expenditure Database.

Second, peak is referring to the occupancy and room rates that remain strong even if the customer demand tends to slow. As seen in the table below there is an increase on tourism expenditures and so, it means more demand yearly. We could interpret that the demand is still strong as seen in the table from Bolivia Tourism Statistics.

Figure 5. Bolivia tourism statistics

Third, the decline stage is the decrease on demand and the risk investors have as well as property values that begin to fall. In relation to that, it is believed that there is no specific data stating this decline but it is happening in Bolivia as in other countries. The reasons of demands decrease may be related to the Worldwide Phenomenon affecting everyone, “COVID-19”.

From the fourth stage, which is “Trough” to the fifth one “Resurgence”; it is possible to be needing a long period time because as mentioned and stated in the previous stage (decline).

Source: Ceic Data World Bank

Meaning that until the worldwide phenomenon disappears or it begins to be more controlled among people and countries; these last stages won’t have a significant change, improvement.

● Socio - cultural

In this section, it is considered the environment influences such as climate, history, religion and ethnic makeup. Indeed, cultural differences between countries as for instance, gastronomy habits. Next, the demographic changes play an important role in terms of market demand impact. As we have evaluated in the surveys and interviews carried on and in the previous sections when we explain the buyer persona; the profile will be one clear but also focused on several segments considering gender, age, groups of people, among others.

● Technological

Concerning the technological environment associated with innovation and developments in information communications technology together with the digital, internet platforms; our proposal is to create Mobile Apps. These APPs will be used in Housekeeping Department which will help improve efficiency, communication and practices. Apart from these APPs which will be Know cross and Flex Keeping; it is being considered to introduce other technological influences that are not applied yet.

● Environmental

What refers to this section are the factors that make the hospitality industry be aware of using appropriate sustainable measures and practices. As our accommodation is defining sustainable and environmental practices; we will assure the respect in natural habits and local community.

Not only thus will be factors we are already compromise on doing but the introduction of reuse of water measures, natural products renewable energy for the electricity supply which is the introduction of solar panels.

4.3. Marketing mix

We have used marketing mix to promote our product in the market based on a set of actions and tactics. In this section, we must keep in mind the client and do research their interests, preferences, comfort and conformity. We have made the following diagram based on what the customer's way of thinking and feeling would be.

Figure 6. The 4Cs of marketing mix

Source: Own elaboration

4.3.1. Product 4.3.1.1 Branding

● Name

ALWA ECO HOTEL; the name comes from the roots of the country in its Aymara language, which means dawn. We use this word since sunrise is part of nature and is one of the most beautiful moments of the day. Apart from that we wanted to transmit the idea that "you will dawn in our cabins and tree houses surrounded by nature and starting the day with us". It is an easy word to remember, to pronounce, beautiful meaning and available as a trademark for registration.

● Logo

Three different proposals were designed for the final logo, from which we chose the third option. Since our objective is to transmit simplicity, quality and style through the letters and brand colours (black and white). We didn’t choose any type of image because we simply decided to use the word ALWA so that customers remember the name and can differentiate it from the competition.

Source: Own elaboration

Illustration 2. Design of logo company

In annex 7 you will find the design of the hotel business cards, staff’s t-shirts and the welcome card design for our clients.

4.3.2. Product/service strategy

The 10 tree houses and 10 cabins are the perfect place to relax in the midst of nature. And enjoy an exclusive and eco-sustainable experience through our workshops, routes and activities. Our accommodation was thought and created to generate emotions and cultivate unique experiences for each of our clients.

Rooms: each room will have bathroom (eco-friendly dry toilet), closet, outdoor shower, king- size bed or twin beds with mosquito net, high-speed internet, light and hot water from solar panels. Moreover, one of our cabins will have a small ramp and all necessary facilities for people who are in wheelchairs. Rooms will be in the middle of trees, palms and other type of plants.

Each cabin and tree house will have their space and will not be very close to each other.

Source: Own elaboration

Illustration 3. Proposals of logo company

Table 14. Type of Alwa Eco Hotel accommodation

As it is seen in the table above, it has been created to show the number of tree houses and cabins we have. The tree houses have different names in the Bolivian native language which is the "Aymara". The rest of the cabins will be differentiated by numbers.

The daily reservation will include a daily buffet breakfast in the restaurant or IRD, visit to the property's orchards, farewell ritual, access to our pool and other facilities. Regarding the amenities will include natural basic hygiene products such as shampoo, conditioner, body cream, body soap, hand soap and a welcome kit consisting of organic orange juice, a variety of local chocolates and a personalized welcome card.

The facilities that our eco hotel has are:

1. Parking

2. Front desk, back office and lobby 3. Staff house

4. Restaurant & Bar '' Sumawa ‘‘(capacity of 60 people) 5. Events zone '' Nampi Zone '' (capacity of 40 people) 6. Tree houses

7. Cabins 8. Hammocks

9. Yoga & meditation area '' Akapacha '' (capacity of 30 people) 10. Training room and workshops (capacity of 30 people) 11. Breakfast space

12. Orchards

Source: Own elaboration

14. Bonfire area 15. Relax area 16. Hammocks 17. Animal sanctuary

All areas will be connected through a cement path and surrounded by trees that will in turn offer the client privacy and tranquility. (See Annex 8 to see images about the different spaces)

● Restaurant & Bar Sumawa will be opened for breakfast, lunch and dinner, and the bar will be opened from morning to night. About gastronomy mainly we will offer vegan and vegetarian options. There will be also a la carte dishes and a menu for lunch and dinner for those who want to try a traditional dish from the area. All our dishes will be made with local and seasonal products. Offering this type of food, we want to demonstrate to our clients that eating vegan is also tasty, healthy and take care of the environment. The schedule of the restaurant & bar will be the next.

Hours of operation:

Breakfast: 07:00 - 10:00 Lunch: 12:00 - 16:00 Dinner: 19:00 - 22:00 Bar: 16:00 - 00:00

● Staff house: in this area, will be the laundry, the storage space, a small dining room with a quiet area for staff and a dressing room with lockers.

● Events - Nampi Zone: This area will be surrounded by trees and will have a large private space for groups seeking a culinary experience or other type of events.

● Training room and workshops: area equipped with large tables, chairs, projector, screen and whiteboard to organize all kinds of workshops and staff training.

● Breakfast space connects with the restaurant; this space is for those who want to have

● Orchards: where we will plant seeds of different vegetables and fruits to consume it, with the organic leftovers we will make compost.

● Relax area: it will have comfortable seats, low tables, floor cushions and jute beanbags.

● Animal sanctuary: the area will be divided into two sections, one area for dogs rescued from animal abuse or abandoned and the other for other type of abused animals.

Activities that we will offer:

● Out of the enclosure

○ Adventure activities: zipline, rafting, paragliding, canyoning (Vagante, Concepción y Garganta de Diablo) , biking, waterfall route and trekking. For this type of activities, we will work with a specialized agency in adventure activities named El Vagante. By working with this company, we guarantee a quality service aligned with the service provided by our hotel, which will agree a commission percentage with this agency.

○ Tourist routes lead by locals ‘Coffee tour’: Coroico and in general Los Yungas is an area where coffee, cocoa, citrus, bananas, coca leaves and honey are produced. In our case, we will offer our clients only the coffee tour.

The following table refers to the type of service that other companies offer when selling tourist routes through Coroico, in regards of our competition. We focus on tourist products such as the route of coffee, cocoa, honey and coca leaves.

Table 15. Comparison companies that offer tourist routes of honey, coca leaf, cocoa and coffee in Coroico

After doing research on the above routes in Coroico, we could find on the internet that there are only two companies offering coffee routes. We didn’t find any other company that offers routes of the coca leaf, honey or chocolate. Probably they are not found on the internet and these routes do exist but they are only promoted through physical agencies. The other option is that they do not exist directly, so we would have to create them. As it is an uncertain scenario;

now Alwa Eco Hotel will only offer the coffee tour.

On the one hand, the way in which we will create our own coffee route will be by visiting a family coffee plantation in Coroico. On the other hand, we will hire a professional guide who will be in charge of guiding our clients through the coffee plantation. Being a guide that will belong to our workforce, it will be needed to have knowledge on the procedure standards to follow regarding customer service. That in relation to maintain our level of quality.

Regarding the ‘coffee tour’, the duration will be 1h and 30 mins. It will include transport service

Source: Own elaboration

pulp and fruit washing, drying and storage of coffee, roasting and tasting of Coroico Coffee and other varieties. The price per person will be 30 € (227 Bs).

Table 16. Final Invoice for Coffee Tour

The table above represents the breakdown of resources we need to know to get the final price of the coffee tour.

● Inside the enclosure

○ Create your own natural products: This workshop belongs to the theme of

‘’How to apply sustainability in your daily journey’’. During the following years other types of related workshops will be introduced. We decided to create this workshop as 54.5% of 154 people surveyed chose it as their first choice to do.

This course is about how to create hygiene products naturally such as toothpaste, body cream, dry shampoo, scrubs, bath bomb, among others. The duration of the class will be 4h and it will start with a brief explanation and situation of the chemical products that we use in our day to day. Each person will have a kit and recipes on the table to start creating their own products. The specialist who is there will explain the process, the benefits, among others. It will be a practical class and at any time the client can ask their questions. The price per workshop would be: 16 € (120,41Bs).

○ Vegan food workshop with local products: For those who want to learn how to

Source: Own elaboration

only have to put their desire. The price per workshop would be: 13,20 € (100 Bs). It includes the preparation of three different meals.

○ Visit to organic gardens: This activity is free; the new guests will be given a short tour of the site to see all the facilities. Our team will be happy to show them our orchards, gardens and relaxation areas.

○ Farewell ritual: the moment the client leaves the hotel he will plant a seed in our orchards. Each seed will have a small sign with the name of the person who planted it. We do this ritual so that the client feels that with this gesture he is contributing to nature and can remember that moment as something special and emotional. After a month, we will contact them by e-mail and send them a photo to see how their seed has grown. Thus, they will feel that we have not forgotten them and possibly return or recommend our accommodation.

○ Yoga & meditation area Akapacha: In the yoga area, the client will have mats, towels, music, water and a trainer at their disposal. The duration of the class will be 1 hour. An additional price must be paid. The price per class would be 12€ (90,31Bs).

Some activities are subject to extra prices; they can be booked from the website so that everything is reserved and organized. In that manner, at Alwa Eco Hotel we will be able to control how many people are interested in this activity and thus prepare the material and have the trainers available. We offer this type of activities, workshops and tourist routes to guarantee the conservation of the environment and the biological diversity of the area.

Considering that our product is focused on young couples and groups of friends, we have decided to create a pack for couples and a discount for large groups. Which will be specified below:

● Pack:

○

The ‘Paya’ experience: it’s a pack for couples that includes a stay of 2 nights and 3 days in a tree house or cabin, a yoga session, an adventure activity to choose from, a romantic dinner in the restaurant and a workshop to choose. The price

Table 17. The “Paya Experience Pack” Price

○ For group of friends: Depending on the group of people the price will be fixed and affordable for all of them. Also, if more than four people are making a reservation, a discount out of the final price will be applied (10%).

4.3.3. Pricing strategy

It is based on studying our competitor prices and the comparison of services offered. The aim is to position the Eco Hotel with a competitive price for the first five years. To set our price per room we have considered the following concepts:

● The price is accessible to our target segment.

● Our competence is defined as ‘’ Eco lodge accommodations’’ however the services, equipment and facilities they offer don’t comply with sustainable practices at all. So, our accommodation considers even the smallest details in terms of sustainable practices and quality of service, that is why about our competition our price is higher.

● Coroico doesn’t have any accommodation like Alwa Eco Hotel offering quality, affordable prices, sustainability and aiming to achieve 2030 Sustainable development goals.

Source: Own elaboration

Considering the 13% VAT of the country, 8% referring to services and 15.5% to goods we have calculated that a double room costs € 168.87 per night and rooms for four people cost € 303.97per night to which we applied a 10% discount to the final price. All prices include breakfast buffet and welcome amenities.

Related to that, the following table refers to the prices of tree houses and cabins:

Table 18. Rooms rate per night “Alwa Ecohotel”

Source: Own elaboration

In the long term, we may vary the price per room but everything will depend on the demand and the season. For future prices, we want to highlight that the high season in Coroico is from May to December and the low season is from January to April.

These are the prices per person of all activities.

Table 19. Activity prices

Source: Own Elaboration

Referring to the price of the restaurant's menus, the first two years we set a price of 25€ for lunch and 35€ for dinner, because at dinner is when we will have more customer demand. In the following years, we have an increase of 5€ to the lunch and dinner menu. Night menu at 40€

and day menu at 30€. Also by offering the restaurant and bar service to external guests will increase the hotel's revenue.

4.3.4. Channel strategy

Considering the distribution channels; they play a relevant part in the business marketing

In document Business plan – Alwa Eco Hotel (página 47-67)