Imagine, sleeping fifteen feet in the air in a glass cube surrounded by a characterized old forest. Imagine, climbing inside a hundred year old pine tree and enjoying a hot, relaxing sauna. Imagine, listening to the birds chirping in the fresh morning air. The experience and magic associated with the TreeHotel in Harads, Sweden is the selling point attracting visitors. The entrepreneur behind this project discovered a tourism market to fulfill this product. In discovering the TreeHotel innovation, research must be conducted on the customers and their product, other existing markets and competitors, and the tourism product itself. The purpose behind the TreeHotel is to take people back to their roots and be in harmony with nature.

First, why would anyone want to go to the TreeHotel? The motivation for people to choose this company could be a number of factors including: a magical experience, isolation, relaxation, adventurous activities, natural beauty, interesting architecture, and a romantic experience. Innovators would be initially attracted to the TreeHotel because it is a new creation with a unique modern design that is environmentally conscious in it’s structure. The natural and isolated atmosphere of the hotel and restaurant, that only uses ingredients from local suppliers, would pull the innovators to the hotel because of new trends that this VALS group practices. These trends are sustainability, going green, learning and enrichment travel, health consciousness, and experiences. The TreeHotel practices these trends by installing environmentally friendly practices in all aspects of the hotel. Initially the forest where the hotel is currently being built was booked to be cut down but was saved by the tree house project. In respect to learning, enrichment and experience travel, the hotel offers many tours and activities involving the history, culture and outdoor adventures in Sweden. How would a business person know about this market when they designed the TreeHotel product?

Marketing research must be conducted to discover the type of consumer that will be interested in such a product. Primary research would include surveys, interviews and questionnaire of a “sample population to allow researchers to make accurate estimates of the thoughts and behaviors of the large population” (Kotler, Bowen & Makens, p.177). Also, research must be done on the TreeHotel’s competitors offering a similar product. Underwater properties, icehouses, igloo properties, and the salt hotel are some competitors offering consumers a different experience, enjoying nature and isolation. In order to further understand the target market, investors must “watch competitor’s ads, check out their websites, and use the competitors product “(Kotler, p.179). A competitor for the TreeHotel is a salt hotel called Hotel Placio de Sal, located in the Uyuni Flats in Bolivia. This hotel also offers a unique hotel design in a naturally beautiful and isolated area. A competitive analysis must be conducted on properties competing with the TreeHotel to generate a better product and further understand the consumer market.

When conducting a SWOT analysis on Hotel Placio de Sal, discoveries were made that the TreeHoltel can use to improve its product, attract consumer, and plan for factors that may influence the company. The location of the salt hotel is a major strength because it offers people accommodation when visiting the deserted salt flats. The salt flats attract many tourists, as they are the world’s largest. Unique architecture and the use of salt blocks attract consumers to an original experience. The adventurous aspect, scenery created by this natural phenomenon, and isolation are strengths of the company that pull consumers to visit their hotel. The amenities offered at the hotel include: a dry sauna, steam room, saltwater pool, whirlpool baths and spa. Relaxation practices target couples for romantic holidays. This is an opportunity for the salt hotel and TreeHotel alike to target young couples for relaxing, romantic get a ways together. Promoting romantic holidays to couples on a website, Facebook add, and in magazines is an opportunity to attract a different type of market. Since the Canadian and American dollars are significantly higher then the South American dollar, the hotel can increase their prices and still attract middle class tourists. The strengths and opportunities of the salt hotel can be used by investors of the TreeHotel to gain a better understanding of their target market allowing them to push and pull the consumers to their property in Sweden.

Investigating the weakness and threats of competitors of the TreeHotel allows investors to be conscious of problems that deter the market form a product. A weakness for Hotel Placio de Sal is the location at an altitude of 3656 meters. This is known to cause altitude sickness for visitors. Also, the vast salt sea can cause disorientation that may result in being lost if you aren’t familiar with the area, creating limited access. Supplies must be transported to the hotel since the only natural resource around is salt. During the rainy season the walls must be strengthened with new salt blocks to prevent deterioration, this causes continuous labour and extra expense. A threat to the salt hotel is the newly established TreeHotel and other competitors. Greater threats to the salt hotel would be the country it is located in because South America is a poor and can be perceived as unsafe. The language spoken causes a barrier for tourists making it harder to communicate and travel easily. Hotel Placio de Sal is a general competitor for the Tree Hotel in Sweden because they provide the same product or service. As a new competitor in the tourism industry, the TreeHotel must identify its tourism product and how it will fit into the tourism industry.

The TreeHotel will fit into the tourism industry by satisfying consumers needs and wants, maturing through the product life cycle and creating a positioning strategy to attract consumers. The tree house satisfies consumer’s physical, social, esteem, and individual needs. Physical needs are satisfied by the food, security, and safety and the hotel accommodation provided. Social needs are satisfied by the relaxing atmosphere and amenities, exhilarating adventurous activities and a common consumer characteristics and interests. Esteem needs are satisfied by the prestige of the new innovation, unique architecture, and exciting adventures that consumers partake in. Finally, Individual needs are satisfied by the new knowledge learned on historical and cultural tours that the TreeHotel offers. “Wants are how people communicate their needs or objects that satisfy their needs” (site). Therefore, the activities, amenities and accommodation provided by the hotel to satisfy consumer’s needs also satisfies their wants.

The TreeHotel is currently in a couple stages of the product life cycle, product development and introduction stage. The hotel has opened with six tree houses, but the tree house property will be in the development stage still when it is moving into it’s growth stage because six new rooms will be developed each year and the final goal is to have 24 rooms. The TreeHotel is a destination that people will want to visit once in a lifetime just for the experience. This factor gives the hotel a short maturity phase because after a consumer visits the hotel once, they are unlikely to come again since it is very expensive and a ‘been there, done that’ location. The trends that influence the consumer’s decision to visit the hotel now will grow old and the consumers will follow the new trends. “Hotels often start to decline and then through a major renovation regain their popularity and a new growth stage” (p. 335). If the TreeHotel follows this strategy they will survive in the market for longer. The TreeHotel mainly markets to Europeans since it is located in Sweden and high-class people who have the money to experience this new property.

The natural forest and abundant waters where the TreeHouse hotel is positioned makes for adventures just out the backdoor.