Management of Tourism Marketing

Market Segmentation • Market segmentation is a marketing

strategy that involves dividing a broad target market into subsets of consumers who have common needs.

Market Segmentation

Is the process of dividing a totally heterogeneous market for a product into several segments.

Each segment is a homogeneous market in all the significant aspects.

One or more of those segments is selected as the organisation targeted market

Finally a separate marketing mix is developed for each segment

Bases for Market Segmentation

• Geography as a basis

• Psychography as a basis

• Demography as a basis

• Behavioral response as a basis

Geography as a Basis • Region

• City size

• Urban/rural characteristics

• Climate

Psychography as a Basis • Social class

• Personality characteristics

Demography as a Basis

• Nationality

• Education

• Age

• Gender

• Income

• Family Life cycle

• Race

• Religion

• Occupation

Behavioral Response as a Basis

• Usage Rate

• Type of Buying Situation

• User Status

• Occasions

• Loyalty Status

Why use Market Segmentation

• The information will allow more sales to be made

• To gain greater knowledge about customers so that it can vary the products

• Prevent promoting product to wrong people

• To target particular groups

Market • A market consists of all those potential

customer who share a particular need or want and are willing to exchange in the process of exchange to satisfy that need or want.

Marketing According to Phillip Kotler • “the process of marketing deals with working

with the (previously defined ) markets to actualize potential exchanges for satisfying human needs and wants.”

Marketing mix • The marketing mix is a set of marketing tools

that work together to achieves company’s objective in the target market.

• Thus the mixture of various marketing tools is called the marketing mix

When marketing their products firms need to create a successful mix of: • the right product

• sold at the right price

• in the right place

• Using the most suitable promotion.

• Putting the right product in the right place, at the right price, at the right time.

To create the right marketing mix, businesses have to meet the following conditions: • The product has to have the right features - for

example, it must look good and work well.

• The price must be right. Consumer will need to buy in large numbers to produce a healthy profit.

• The goods must be in the right place at the right time. Making sure that the goods arrive when and where they are wanted is an important operation.

• The target group needs to be made aware of the existence and availability of the product through promotion. Successful promotion helps a firm to spread costs over a larger output.

Main variables of Marketing Mix • Product

• Price

• Promotion

• Place

Marketing Mix in Service Industry • People

• Physical evidence

• Process

Product:- • A product is seen

as an item that satisfies what a consumer needs or wants. It is a tangible good or an intangible service. Intangible products are service based like the tourism industry, the hotel industry.

Price

• The price is the amount a customer pays for the product.

• The price is very important as it determines the company's profit and hence, survival.

Promotion

• Represents all of the methods of communication that a marketer may use to provide information to different parties about the product.

• Promotion comprises elements such as: advertising, public relations, personal selling and sales promotion.

Advertising

• Advertising covers any communication that is paid for, from cinema commercials, radio and Internet advertisements through print media and billboards.

• Public relations is where the communication is not directly paid for and includes press releases, sponsorship deals, exhibitions, conferences, seminars or trade fairs and events.

• Word-of-mouth is any apparently informal communication about the product by ordinary individuals, satisfied customers or people specifically engaged to create word of mouth momentum. Sales staff often plays an important role in word of mouth and public relations

• · Where and when can you get across your marketing messages to your target market?

• · Will you reach your audience by advertising in the press, or on TV, or radio, or on billboards? Through PR? On the Internet?

• · When is the best time to promote? Is there seasonality in the market·

• How do your competitors do their promotions? And how does that influence your choice of promotional activity

Place

• Refers to providing the product at a place which is convenient for consumers to access. Place is synonymous with distribution.

• Place is the location at which prospective customers may be induced to purchase a service-the point of sale(e.g. Travel Agent)

• Where do buyers look for your product or service?

• · If they look in a store, what kind? A specialist boutique or in a supermarket, or both? Or online? Or direct, via a catalogue?

• · How can you access the right distribution channels?

• Do you need to use a sales force? Or attend trade fairs? Or make online submissions?

• What do your competitors do, and how can you learn from that and/or differentiate?

Marketing Mix in Service Industry:-

• The traditional marketing mix model was primarily directed and useful for tangible products. The 7 Ps model is more useful for service industries. The other Ps in Service industry is:

• People

• Process

• Physical Evidence

People • 'People' refers to the employees of the

organization with whom customers come into contact.

• Recruiting the right staff and training them appropriately in the delivery of their service is essential if the organization wants to obtain a form of competitive advantage. Consumers make judgments and deliver perceptions of the service based on the employees they interact with. Staff should have the appropriate interpersonal skills, attitude, and service knowledge to provide the service that consumers are paying for.

People:-

• These refer to all human actors who will participate in the delivery of the service

• This refers to the company employees who directly and indirectly interact with the customers. The customers will judge the company services on the how the employee dresses and their behavior in front of the customers.

Physical Evidence

• Services are intangible in nature most service providers strive to incorporate certain tangible elements into their offering to enhance customer experience.

• Similarly, restaurants invest heavily in their interior design and decorations to offer a tangible and unique experience to their guests.

• This refers to the tangible components needed in the execution of the service like calling cards, signage, brochures, equipment’s, and letterheads. It also refers to the venue where the service will be executed; an example is the branch office of the bank or fast food chain. Elements within the store—the store front, the uniforms employees wear, signboards, etc

Process

• This is the flow of activities that the company will follow in the execution of the service.

• This is also the actual procedures or processes flow used by service companies.

• The Process of giving a service, and behavior of those who deliver are crucial to customer satisfaction.

Thank you