The Marketing Mix for Tourism Services

1. The Marketing Mix for Tourism Services Objective: Introducing the four basic controllable variables – known as the 4Ps of marketing that marketing managers use in order to manage demand. In addition, explaining how these variables expanded to include people, process and physical evidence or design for travel and tourism services.

2. Marketing mix defined A company’s success depends on the ability of the company in; • responding the changes in the environment, • forecasting the direction and intensity of these changes, and • using the internal controllable resources (marketing mix) in adapting to the changes in the external environment.

3. Marketing mix may be defined as the mixture of the controllable marketing variables that the firm uses to persuade the customers in the target market in order to secure sales. • Basically, the marketing mix variables are referred to as the 4 Ps: product, place (distribution), promotion, and price.

4. The four controllable are the product formulation which is adapting the product to the changing needs of the target customer;pricing which is used to increase or slow down the volume of sales according to market conditions; promotion which is used to increase the numbers of the people in the target market who are aware of the product and directed to buy the product; the place which determines the number of prospective customers who are able to find convenient places and ways to convert their buying intentions into purchases. • These four are guided continuously according to the market conditions, especially with regard to the actions of the competitors.

5. 4 Ps and 4 Cs • The four conrollable marketing mix elements all begin with the letter “p” by McCarthy (1981). They are stated in producer oriented terms, therefore Kotler and Amstrong (1999) restated them by using the “c” to reflect consumer orientation central to modern marketing today. • Customer value for product • Cost for price • Communication for promotion • Convenience for place

6. Product Product covers the shape or form of what is offered to prospective customers. Product components include: • Basic design, such as the size and facilities of a hotel. • Presentation, which is mainly the atmosphere and environment created on the property. • The service element, which includes the number, training, attitudes and appearance of the staff who deliver the product to the consumer. • Branding, which identifies particular products with a unique name and image. In other words, is the synthesis of all product elements. So that, it is the focus of the promotional activity.

7. In modern marketing, products in travel and tourism are designed for and continuously adapted to match, target segments’ needs, expectations, and ability to pay. Most organizations produce and market not one but several products. For example, tour operators provide a range of products within their brochures. And large hotels have separate products ranging from meeting and business class rooms to short break packages for holiday market.

8. Activities: Product planning; product research and development; product testing; and the service accompanying the product. • Market research on product planning, development, and product testing • Product research on the development of product styling and fashions • Presale service • Postsale service

9. Price • Price indicates that the published or negotiated terms of the exchange transaction for a product between a producer ( who aim to achieve predetermined sales volume and revenue objectives) and prospective customers ( who aim to maximize the value for money in choices they make between alternative products). • In tourism there is generally a regular or standard price for a product. In addition, there are discounted or promotional prices because of the needs of particular segments of buyers, or particular market conditions such as seasonality.

10. Activities: Price determination; pricing policies; and specific pricing strategies. • Determining list price of products given demand, cost, and competitive constraints • Determining channel member discounts • Setting overall strategy on pricing above or below competitors’ prices • Dealing with legal constraints on prices

11. Place (or distribution) • For marketing purposes, place does not just mean the location of a tourist attraction or facility, but the location of all points of sale that provide access to tourist products. For example, “place” for Disney World in the USA is not only Orlando, Florida, but also the numerous travel agents that sell the Disney World product. However, travel agents are only one of the ways in which “place” or access is created for products in travel and tourism. Place would include computerized and other reservation/booking systems that provide access to products for repeat/loyal or prospective customers.

12. Activites: The selection, coordination, and evaluation of channels; transportation • Transportation • Determination of the basic channels of distribution • Selection of individual establishments within the basic channels • Producer’s efforts to develop and assist the channel of distribution

13. Promotion • The most visible of the four Ps is the promotion which includes advertising, direct mailing, sales promotion, brochure production, merchandising, public relations (PR). Promotional techniques, which will be examined in detail in the following chapters, are used to make prospective customers aware of products in order to sharpen the attractiveness and stimulate demand. In addition, they provide information to help customers decide, and generally provide incentives to purchase. Note that, promotion can only be effective if it is coordinated with the other three.

14. Activities: Sales management; personal selling; advertising; sales promotional programs; and all other forms of marketing communications • Product branding and promotional packaging • Printed media advertising (newspapers, magazines, and brochures) • Broadcast media advertising (radio and television) • Sales management and personal selling, including training, and supervision and sales efforts of company management personnel • Special promotional activities - promotional warranties, trade shows, dealer aids, and product displays

15. Expanding the marketing mix • The expanded marketing mix is offered by Booms and Bitner in the 1980s. They added; • People; participants in the service delivery • Process; of service delivery • Physical evidence; of service delivery • There is overlap between them. In addition, they may be considered as part-product and part-communications mix.

16. People • Regarding travel and tourism products, there is substantial human interaction as part of the service experience. Participants include; • Visitors; interaction with other customers • Employees; front-line and support staff interact with visitors • Host community; residents of a destination country interact with visitors

17. The service delivery process • The travel and tourism experience includes both process and outcome. • Consumers move through a series of sevice delivery encounters during their experience. • Some encounters may be more important than others; • Critical incidents • Moments of truth

18. Critical incidents; specific interactions between a consumer and service employees (or equipment) that are especially satisfying or dissatisfying. They are less memoriable. • Moments of truth; stays in consumer’s mind and signify quality and satisfaction. • Service recovery systems are required to turn dissatisfied customers into satisfied customers. For this, companies need to; • Measure and track the costs of customer retention • Encourage complaints • Train employees in service recovery

19. To improve the performance of service delivery; • Using scripts; sequence of actions, equipment and words that help to have a smooth and seamless service delivery process • Service blueprinting; flowchart of the service delivery process; a picture, graphical representation or map that accurately portrays the service system so that the different service people can understand and deal with it objectively. A blueprint can involve all relevant points of contact, standard length of time for activities, bottlenecks, possible service failure points, etc.

20. Physical evidence and design • Refers to the internal and external design of the built environment of the travel organization. • Due to inseparability, physical setting in the service delivery process is an important part of the visitors’ experience. • In relation with intangibility, it is used to tangibilize the offer, especially important at the point of sale to influence purchase.

21. Useful Links and Sources • Kotler, P.; Bowen, J. and Makens, J. (1999). Marketing for Hospitality and Tourism (2nd ed.). Prentice Hall. NJ. • Kotler, P. and Armstrong, G. (2006) Principles of Marketing (11th ed.). Prentice Hall. NJ. • Middleton, V.T.C. (2004) Marketing in Travel and Tourism (3rd ed). Elsevier. Oxford. • http://www.hotelsmag.com • http://www.tourism.bilkent.edu.tr/~eda