Marririott Case Study

Companies across the world conduct business within certain market structures. These market structures have been established based on factors such as, the number of sellers within the market, the barriers that exist within the market that create difficulty for new companies to come into the market, the types of products that are being sold, the nature of the competing companies, and the pricing power that the companies within the market have. This paper will examine the different types of market structures organizations operate in and evaluate the differences between market structures. It will also take a closer look at the lodging industry and one of its biggest players, Marriott International, at the market structure in which this corporate giant is operating in.

There are four basic market structures: perfect competition, monopoly, monopolistic competition and oligopoly (Sheeba, 2012). First, let’s look at the two extreme ends of the spectrum. A perfect competition market exists, when there are several firms that are present in a market who all produce identical products and are all sold at market price. None of the producers in the market can control the price and the demand curve is perfectly elastic. The entry

These additional expenditures would shift its average total cost curve up and would continue till its profits disappeared and the new demand curve is tangent to the new average total cost curve. A monopolistically competitive firm can make no long run economic profit (HTrends, 2008). Marriott has tried to differentiate itself by making use of its most expensive resource, its people. Marriott implemented this focus with the support of very selective hiring - an approach used by Southwest Airlines, and a new customer feedback mechanism for evaluating staff and unit performance