Destination Marketing - The Marketing Mix

MARKETING MIX
THE FOUR Ps
DEFINITION
The marketing mix is the emphasis that on organization or destination places
on the four main factors that influence a customer’s purchasing decision.
• Product
• Price
• Place
• Promotion
Organizations and destinations must analyze or review each element of their

marketing mix to improve the marketability of their products.
PRODUCT
DEFINITION:
A product is anything that can be offered to a market for attention, acquisition, use or
consumption that might satisfy a need. It includes physical objects and services.
CHALLENGES:
1) Tourism “product” covers the complete experience, from the time the tourist leaves home to
the time he returns to it.
Organizations, destinations, and tourism subsectors must be interlinked to offer a consistent and
quality service.
2) Augmented product: services are usually composed of a multitude of components, which can
be difficult to separate. This means that the “core product” is augmented, is augmented by
additional services which also contribute to the overall level of customer experience and
satisfaction.
Analysis of the destinations should focus on the complete product offering,
considering
ALL SUBSECTORS:
-accommodation
-transportation
-catering services
-ancillary services (rental services, money exchange, phone plans)
-tour operations
-visitor attractions
-travel agents
USP : when reviewing the product element, at times destinations might focus
more on one aspect, to carry out a differentiation strategy or to create a USP.
PRICE
General economic factors:
1) Prices also vary and adapt to the general levels of prosperity, standards of living and interest
rates affecting the local economy.
2) PRICE SENSITIVE: the tourism industry, as it is based on the spending of disposable income, is
price sensitive. This means that people’s spending on tourism products and services is
dependent on prevailing economic conditions. Recessions and economic crisis, which affect
the spending power of consumers, result in a contraction of the travel and tourism industry.
PRICE
A REVIEW OF THE PRICE ELEMENT IN THE MARKETING MIX INCLUDES:
1) Providers should RECOVER THE ACTUAL COSTS incurred and generate additional income
Additional income level change according to the characteristics and business objectives of the
providers (public organizations, private industry, public or private funding, etc)
2) PRICE-QUALITY RELATIONSHIP and expectations: concept of value for money.
3) Uniqueness of the destination and of its products in the market and the level of competition in
the market: tied to the position of the product (PRODUCT POSITIONING). When only a few
number of substitutes are present, a higher price may be set. Destinations with limited tourism
development tend to set lower prices to attract visitors.
4) SEASONALITY: high prices can be charged to visit popular destinations during peak seasons
5) GOVERNMENT INFLUENCE: levels of taxation will impact on the pricing strategies adopted.
PRICE
PRICING STRATEGIES
1) MARKET SKIMMING: used to break into the market, for products which have little
competition. A high price is charged initially targeting customers (INNOVATORS) who enjoy
having the privilege of traying new products first. The price is then gradually reduced.
EMERGING DESTINATIONS
2) PENETRATION PRICING: when launching into highly competitive markets, artificially low
prices are set to entice visitors. This can lead to increased attention or gaining a large market
share. Customer loyalty is sought. This strategy may result in pricing wars between providers.
3) THE GOING RATE/COMPETITOR BASED PRICING: when there is a high degree of similarity in
the product offered, a polity of price-matching may be used.
4) PROMOTIONAL PRICING: special offers, discounts, BOGOF, coupons are commonly used
when sales are slow (seasonality) or when products are close to expiring.
PRICE
PRICING STRATEGIES
5. PRESTIGE PRICING/PREMIUM PRICING: when products are of high quality or have an

exclusive appeal, high prices can be set to link high prices with high quality.
6. VARIABLE PRICING/PRICE DISCRIMINATION: there a multitude of discriminants used to vary
prices. This is based on the principle that demand for products varies: according to
seasonality, according to customer type, etc.
PLACE
“Place” is used to describe two aspects of the marketing mix:
1. The physical location of the destination and its products
The term destination includes both natural occurring places, but also artificially created
locations. In both cases, the natural features of the locality, on top of other characteristics (cost
of living, character of the local area, criminality rates, etc) determines the suitability of becoming
a tourism destination. Transport and access links are also crucial.
A review of these features can be undertaken at regular intervals, even if many features can
hardly be changed.
PLACE
“Place” is used to describe two aspects of the marketing mix:
2. The chain of distribution used by providers to communicate and sell their products and
services.
There are two main ways to make products available to customers: directly and indirectly.
Traditionally, indirect channels of distribution through intermediaries (travel agencies) have been
the most popular. However, direct links are now favored using web-based channels.
PLACE
DIRECT DISTRIBUTION: online booking through the provider’s website or offline via email,
telephone or face. It brings increased initial costs, high investments in marketing and promotion
but more control of the product. Constant fees to the middleman are avoided.
E-ticketing has allowed for direct and immediate booking; customers make online bookings using
CRS, which allows real time checks on availability and, in turn, has created global distribution
systems.
INDIRECT DISTRIBUTION: increased costs to be paid to intermediaries (tour operators, travel

agencies, destination management companies, third parties websites) but minimal initial
investments. Less control over the product, as travel agents may influence the costumer’s
perception.
PROMOTION
PROMOTION/MARKETING COMMUNICATION: it is the publicizing of a product, organization or
destination to increase the number of sales, customers pr visitors by raising public awareness. Its
primary purpose is then of communication marketing information to customers, both new and
existing.
PROMOTION
AVERTISING: it is the most expensive forms of promotion and its impact is difficult to measure, as
it reaches a great number of people. Its impact can be assessed through surveys. It can be done
using a broad range of media:
-broadcast (television, cinema, radio advertisements)
-print (newspapers, magazines, information leaflets)
-display (billboards, prints of sale displays, touch screen info boards, etc)
PROMOTION
DIRECT MARKETING: it utilizes new digital technologies to address customers on social media,
subscribers on platforms, email addresses, etc.
Targeting followers and subscribers targets customers who already have an interest in products
and services of the organization, increasing the effectiveness.
PROMOTION
PUBLIC RELATIONS: it refers to all the professional actions which work to create or uphold a
positive image for the organization. It works to create or support the reputation as it enables
organizations to project themselves in a favorable light to the public.
-press releases
-features on television/newspapers, magazines etc
-attendance at trade fairs
-hosting familiarization trips
-holding press conferences
PROMOTION
SALES PROMOTION, directed specifically at customers or at trade partners.
1) Discount coupons, special offers, loyalty incentives are used to both entice and reward
customers for their loyalty, thus in turn creating such loyalty.
2) Trade promotions include incentives such as commissions or bonuses paid to travel agents or
tour operators for endorsing the product/inclusion in the tour.
A review of the promotion element in the marketing mix will allow organizations to update the
promotional methods it uses. Changing promotional methods or adopting new pricing
strategies are easier to manage than making radical changes to the product and services
offered or to the infrastructure of the destination.

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MARKETING MIX

Organizations and destinations must analyze or review each element of their

5. PRESTIGE PRICING/PREMIUM PRICING: when products are of high quality or have an

1. The physical location of the destination and its products

INDIRECT DISTRIBUTION: increased costs to be paid to intermediaries (tour operators, travel

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