TOURISM AND HOSPITALITY MARKETING

LESSON 2: TOURISM MARKETING

Travel and tourism marketing is the systematic and coordinated execution of

business policies by the both private or public and public sector tourism
organizations operating at the local, regional, national, or international level to
achieve the optimal satisfaction of the needs of identifiable tourist groups, and in
doing so to achieve an appropriate return.

Travel agencies in the pre-deregulation, pre-liberalization, and pre-globalization

era were often contended to take whatever business that come along this way
and sold them on a straight commission basis without bothering about the
extensive marketing. Moreover, their scope of the operation was small and was
not much complex, sophisticated and competitive.

But today the travel companies are becoming larger, more sophisticated and
more automated in management. Similarly, the clients/tourists are also
becoming more trained, experienced, erudite and demanding higher quality
services and packages.

Therefore, in this volatile travel business environment, marketing knowledge and

skill are more necessary ingredients than the product knowledge and
enthusiasm, for a travel agency’s long-term survival and growth. Thus, this has
led to the use of tourism marketing which is recent phenomena.

History of Tourism Marketing

The “marketing concept” is not very old. I came into the scene in the 2nd half of
the 20th century. In the beginning, it was linked with the number of closely
associated factors for achieving volume sales.

The development of the marketing concept, in fact, is the outcome of political,

technological, social, economic and business pressures. However, the
importance of marketing within travel and tourism industry has been the level of
economic and business growth throughout the 20th century, which has led to the
improvement in living standards, an enlargement of the population and an
increase in discretionary income and time.

These changes have also led to the construction of infrastructure,

accommodation, transport, and other recreational facilities. Within a very short
period, travel and tourism have become one of the most important and leading
industry in the world.

Modern tourism marketing has evolved as a business reaction to changes in the

Socio-Economic environment, with the most successful tourism companies or
tourism bodies have demonstrated a keen sense of providing the right of
organizational structure and products offer for the visitors/tourists.
Interestingly, the tourism companies have recognized the significance of key
factors such as needs, wants, and satisfaction in the planning and designing of
the tourism product. In the tourism industry, every tourist wants to be treated as a
special client and any organization catering to this attitude of the tourist will
naturally be head of other competitions.

Definitions of Tourism Marketing

According to Kotler, ” Marketing is a social and managerial process by which
consumers obtain what they need and want through creating and exchanging
product services and values with other.” He has emphasized more on wants,
needs, satisfaction, demand, and marketers.
According to the British Chartered Institute of Marketing, ” It is the management
process responsible for the identification, anticipating, assessing and satisfying
the customer’s client’s requirements profitable.”

The modern marketing concept is not limited only to the identification and
satisfaction of customers. It is a comprehensive process which encompasses
research and analysis of society’s as well as consumer’s needs, asserts the
company’s resources and marketplace and delivers the products/services to
those whose experience provides a set of satisfactions which are preferable to
those of the competitors.

Krippendorf defines tourism marketing,” as the systematic and coordinated

execution of business policies by both private or public sector tourism
organizations operated at the local, regional, national, or international level to
achieve the optimal satisfaction of the needs of identifiable tourist groups, and in
doing so to achieve an appropriate return.”

According to Paynter (1993), ” tour marketing is a systematic process consisting

of marketing objective, strategies, schedules, marketing media, focused on the
specific market segment and based on a substantial return on investment.”
World Tourism Organisation (UNWTO) at Ottawa Seminar, has defined tourism
marketing as,” a management philosophy which, in the light of tourist demand,
makes it possible through research, forecasting and selection of tourism
products/services from suppliers, on the line with organization’s purpose and
tourist satisfaction.”
The following aspects can be identified from the above definitions:
 Tourism marketing is a thought-provoking process.
 Identification and selection of the target market.
 Positioning and product lifecycle is important.
 Future tourism marketing strategies.
 Innovative/proactive marketing.

Unique Features of Tourism Marketing

Tour package as a specialized product creates a number of significant
considerations which need to be fully analyzed. The management of tour
package cannot be divorced from the management of service and quality. Thus,
the marketing of the tour package is different from other products because the
tour package is a service product where instead of selling physical goods an
intangible experience is sold.

An understanding of the complexity of the tourism product concept is an essential

pre-requisite for effective tour package marketing in this context. The specific
features of tourism marketing are:

 The demand for tour package is highly elastic and seasonal in nature.
 Tour package is a combination of various service ingredient.
 Designing, developing and marketing of tour package a number of
intermediaries are involved. Bed experience at one level can spoil the
entire image of the package as well as the tour operator.
 A tourist does not only by the tour package in advance because it is
consumed and felt at the same time at a particular destination.

It is not possible to evaluate/demonstrate/sample the tour package in advance

because it is consumed and felt at the same time at a particular destination.
Tour Package Marketing

The tourism industry provides for a combination of different products and

activities, which ranges from small taxi operator to the largest airline or hotel
chain. The concept of change and survival are as important to the tour operators
as they have to deal with both various vendors in the tourism market. It would,
therefore, become imperative to understand what is tour marketing planning
especially for the long-term survival of ant tour/company.

A tour marketing plan is a structured guide for carrying out marketing operations.
It provides a common structure and focuses on all the company’s management
activities. The purposes of a marketing plan include:
 It provides a clear direction for marketing operations.
 It coordinates the resources of the organization in order to eliminate
confusion and misunderstanding and achieving cooperation.
 Identifying different market segments.
 Setting targets/goals.
 Identifying the organization’s strengths and weaknesses.
 Corporate mission and goals.
 External and Internal Audit.
 Business situation analysis.
 Creating the objectives.
 Providing an effective marketing mix strategy.
 Monitoring the plan.
Thus, it has become imperative to discuss the tour marketing segment, tourist
generating market, and tour marketing mix before developing a tour marketing
plan.

Tour Market Segmentation

It involves a division of the prospective market into identifiable groups. The
reasoning behind this is that a tour package can be sold more effectively if efforts
are concentrated towards those groups which are most potential.

According to Middleton, “Market segmentation is the process whereby producers

organize their knowledge of customer groups and select for particular attention
those whose needs and wants they are best able to meet their product.”

The main purpose of tour market segmentation in tourism marketing are:

 Segment the tourists generating markets.

 Identify the network of intermediaries.
 Identify the nature of demand for one’s product.
 Identify the prospective tourists.

An effective market strategy will determine exactly what the target market will be
and to attempt to reach only those markets. The target market is that segment of
a total potential market to which the tourist attraction would be most saleable.
Targets markets are defined geographically, demographically and so forth market
segmentation must be employed in the marketing programmes to both the long-
term strategies. Every tourism attraction can appeal to a multitude of market
segments, and the market segment can overlap a great deal. The tour manager
must look at market segments and determines which one offer the promising
potential for his/her service.
Tour market segment further categories into the following types:

1. Geographic Segment
2. Demographic Segment
3. Psychographic Segment
4. Socio-Economic Segment
5. Price Segment

Geographic Tourism Market Segmentation

This segment is based on the idea that customer needs differ according to
geographic regions.

Demographic Segmentation
Under this segmentation, the tourism market is divided into various groups,
keeping in view the demographic variables such as age, income, sex family size,
occupation, education, religion etc.

Behavioral Segmentation
In this segmentation, prospective tourists are segmented on the basis of their
knowledge, attitude, use or response to the tour product. Under this
segmentation, the marketing strategies of a four-company include:

 User Status
 Usage Rate
 Loyalty Status
 Buyer Readiness Stages
 Attitude

Psychographic Segmentation
Under this, the tourists are divided into different group on the basis of their social
status, lifestyles, and personality characteristics. For example, upper class, upper
middle, lower classes, product preferences, adventure sports, etc.

Price Segmentation
Price ranges often come in handy in segmenting the tourist markets, such as

 Those who want to take a low priced vacation.

 Those who may take a moderately priced vacation.
Price ranges communicate to the tourists the quality expectation of a product
along with the producer’s image. While determining the price of a tour package a
tour planner must understand the paying capacity of the tourist.

Tour Marketing Mix

In the competitive tourism marketplace, a tour operator can be successful if it’s
complete marketing mix offer matches what the tourist wants. It is planned and
coordinated by marketers so that the input can be contributed in such a way that
the company will be able to maximize demand and satisfaction of the tourists.

The concept of the tour marketing mix is equally relevant in the case of tourism
products as it is in the case of other services and goods. Tour marketing
manager must constantly search for the right marketing mix, the right
combination of elements that will produce a profit. The marketing mix is
composed of every factor that influences marketing efforts such as:
  Time
 Brands Pricing – In the Ratio of quality and value
 Product features
 Image
 Channels of distribution – both international and national
 Advertising
 Selling techniques
 Public relation
The fundamental starting point for the creation of a successful tour marketing mix
to ensure that the target market is clearly defined. The target market is the focus
of all marketing mix activities. Generally, the marketing mix constitutes four P’s .
These four P’s are following as:
 Product
 Price
 Promotion
 Place
However, besides these four P’s in the tourism industry fifth P – People, Process,
Physical evidence is also of most relevance.

Developing Tour Marketing Plan

The marketing of the package tour is materially different than the marketing of
other tourism products. The reasoning behind this is that the type of tours offered
by one tour company and another are different, and the marketing strategies also
differ from company to company.

Each company has a wide range of tours and marketing strategies. No other
travel and tourism industry component have such a wide range of specialization.
This fact should be recognized, that the effective and profitable marketing
strategies are based on the tour marketing plan which is a complete ‘mechanism’
for the success of a tour company. The mechanism includes several
components. These component and stages of making a tourism marketing plan
are following as:

Developing a tour marketing plan

Marketing Budget

Plan Strategies

Prepare Plan Schedules

Decide Media Plan
Developing Advertising Plan

Developing Public Relation Plan

Preparing an Annual Sales Plan

Feedback and Evaluation Plan