Marketing Management Of Tourism

Question: Write an essay on Marketing Management Of Tourism? Answer: Executive Summary The concept and process of marketing for CanTour is discussed. The elements of marketing in tourism industry are elaborated. The benefits and cost analysis is made on various factors that affect tourism industry. Segmentation, targeting and positioning is analyzed to reflect on the marketing mix.. The proposals developed for promotion to appeal the public are framed. Promotional strategy for different market is designed. Different tourist approach to attract customers to Greenwich tours is demonstrated. Introduction CanTour is a tourism agency set up on the coast of river Thames that is in South East London Greenwich. This location serves as an excellent place for accessibility because it serves various advantages like exposure to goods and services for a particular area for short amount of time. Tourist guides help in making the tour as a memorable experience for the tourists. They also leverage offering discount coupons for food places and restaurants. CanTour with regard to Greenwich Tourism meets standards set up by tourism board so that the tourist visit and refer more people to visit their place and choose them to provide tourist service. Brand overview is done to relate to target markets. Strategic goals must be framed that achieve objectives and performance indicators to measure success. Assessment of social media and website optimization is done for a plan arrangement for promotions in educational fairs, events and destination trips (Blythe, 2011). Elements Of Marketing Product- This element identifies the type of customer, level of service and standards provided by CanTour. Unique selling point is identified which helps in standing a way out from other competitors. It may also be noted that the product life cycles are turning shorter so that the offerings of CanTour increases likely in the next two or three years. For viability and continuance of business, resources are allocated to improve product and also adds in development. Market research is to be conducted to monitor and identify opportunities and problems to meet the demands of market (Butowski, 2011). Price- The pricing of CanTour could be a little confusing to new industry players. The pricing is set up as costs attributable to the tourism plus profit margin. Also there is commission involved with retail agents who expect a commission between 10% and 20% while commission for wholesalers being between 20% and 30%. Inbound Tour Operators or ITOs charge approximately 25% to 35%. The retail price includes the net rate plus the commission chargeable plus Goods and Service Tax (Carroll, Carroll and Carroll, 2011). Place- This element refers to channels at a national or international level that includes Retail agents, Wholesaler agents and Inbound Tour Operators. The target market is Greenwich or South-east London on the coast of Thames River which is accessible by boats, buses, over ground trains and DLR. The people visit River Thames because it is a centre attraction of London and its accessibility. The growth of online market has increased rapidly the number of tourists. This cuts down intermediaries and book with the providers directly. Online booking for tours also helps is making it convenient for the people who visit the place. Booking in advance saves a lot of time and inconvenience (Conrady and Buck, 2012). Promotion- There are two promotional strategies followed for CanTour marketing- Above the line includes Promotion in the media channels like television, newspapers, websites, radio and mobile phones where the advertisers have to pay an advertisement on the basis of a predetermined format. Below the line promotions includes sales promotions, endorsements, direct mail or e-newsletters, personal selling, merchandising , trade shows and web listings (Crotts and Wolfe, 2011). In tourism business, there is another P as an element of marketing- Packaging- This element involves combination of several packages. It involves an attractive package that combines lodging or accommodation, transport and maybe food presenting them as a single price. It involves one major component, i.e. tourism and adds other offers creatively that the people think is hassle-free. They dont have to run or search for places or other facilities when they get it all summed up as a single package (Das Gupta, 2011). Evaluation Of Benefits And Costs Tourism is a service provided to people. It also provides employment to localities and generates income to revitalize economic conditions. Follow-up activities with special training to the tourist guide are also followed. Various tourist operations and management are conducted by CanTour. Marketing is successful when it is human-oriented and creatively communicates as well as impart information to the tourists. Effective tools to run a tourism industry depend on the training provided to the tourist guides. Training program to achieve marketing goals by improving knowledge through digital marketing or destination marketing is creatively assessed (French, Reynolds and Merritt, 2011). Evaluation of marketing orientation is done on the basis of two criteria namely, Product Criteria and Psychological Criteria. Product Criteria involves the following factors- Price or Cost- The pricing is done in such a way that takes an account of necessary expenditures that covers various factors like accommodation, food, entertainment taxes, and ticket prices for visiting historical places. Quality- The quality of services provided by CanTour will be well managed and of top-notch standards. The guides are well trained for their behavior and are knowledgeable so that they can impart to the tourists. Aesthetic Qualities- The aesthetic qualities of CanTour should be enhanced by taking the tourists to witness the aesthetic beauty in Greenwich. A walking tourism helps in exploring places in depth. Psychological Criteria involves the following factors- Social Needs and Satisfaction- It is a vital aspect of tourism. Walking tourism enables in exploring more tourist places and food places. They can roam around and rest as per their needs. Satisfaction of ego needs- Ego needs to be satisfied. The tourists should feel contented with the tourism. The walking tourism is planned in such a way that covers major historical places like The Cutty Sark, Maritime Museum, Greenwich Park and Queens House (Greenwichhistory.org, 2015). Image of the product on the lifestyle- The tourism is designed in such a way that all age groups can enjoy. The senior citizens and children would love visiting the park. While the younger generation would love visiting the museum, Queens House and Cutty Sark (Gupta, 2012). Analysis Of The External Environment The external environment is the forces outside the scope of a company which are effective in influencing and changing the companys structure and the way it does business. These forces are the condition in and around which a company is built. These forces are beyond the control of the company and the company must adapt itself to the external environmental forces to run a smooth business. Hence a PESTLE analysis is done to better understand the macro environmental forces and how it might affect CanTour. The Political forces are how the government and its norms affect the Tourism Industry. The Britain tourism industry has seen a great boost post world war two. Events like the demolition of Berlin wall had a profound impact on the tourism industry. The Single European Market has made it easy for the Europeans to visit countries. The government is watching over taking care of historic places by labeling them as heritage sights and thus giving a boost to the tourism market as more people are interested to see this (Hassan and Iankova, 2012). The Economic forces are the deciding factor of the financial growth of the business. The increase in cost of travel and the recession and sudden unemployment has lead to a decrease of incoming tourists. But there is a sudden rise of domestic tourist as people are more likely to travel inside UK than go abroad. Also people tend to book holidays by themselves and so tourism agencies are finding themselves in a loss. The Social forces that influence the business are that people have become increasingly independent when traveling. They like to prioritize their destinations and spend extra time in a particular places and thus chooses to go solo. Another factor is the epidemics and pandemics has lead to people cancelling trips and less people visiting if there is a fear of contamination (Hastings, Angus and Bryant, 2011). The Technological forces here have been positive in taking businesses further. Flexibility in booking through online portals and call centers has lead to an easy planning of tours. New offerings through these portals have lead to a wider consumer interest. Development of commutation services like airports and tour trains and buses has been increasing the number of tourists visiting (Hkhk.edu.ee, 2015). The Legal forces are the laws and regulations leading to tourism industry fluctuating between new rules and regulations. But the free trade and travel has lead to lots of inflow of tourists from various countries. The Environmental forces are today the major issues every industry is facing. The natural disasters like floods, volcanic eruptions, tsunami and earthquakes has deceased tourism somewhat. Other factors are the change in climatic conditions leading disrupting of the natural order and the beauty of places has been a factor in deciding the tourist influx. After the macro environmental factors it is the micro environmental factor which influences the business from all the corners. Porters five forces are discussed to better understand the characteristic of this forces and how they influence the tourism industry and hence CanTour (Hoffman and Bateson, 2011). The Threat of new entrants is one of the main issues which every tourism agency has to face. The profitable scenario of the UK tourism industry is attracting new agencies. But this will on the other hand will lead to a decrease in the profitability of all the firms in the industry. Threat from new or substitute services will be people focusing on other parts of UK and neglecting Greenwich as a tourist hotspot. People may also due to other reasons avoid the country or traveling as a recreational hobby all together. Also people might npt like the concept of a walking tour (Hstg.org, 2015). Bargaining power of suppliers or rather the retail agents will decide the cost factor of the tourism agency. Thus this people must be managed and smartly dealt with to keep the cost minimum (Hudson, 2012). Bargaining power of customers is the ability of the people to put the firm under pressure, to change its rates or other commodities. Brand switchers, buyer concentration and information are the factors that must be checked. Finally the Threat from rivals of the firm adds a competitive edge to the business so that there is constant innovation and competition in advertising and expenditure while balancing the pricing. The above study has lead to the conclusion that the proposed firm must take note of the macro environmental factors when they are thinking about the accommodation and lodging of the tourist. In case of the micro environmental forces, studying what the big players are doing and strategizing their own business in the same way would help in clearing all the obstacles present (Kozak et al., 2013). Market Segementation The market is segmented into various groups who will form the groups towards whom the entire marketing strategies will be targeted at. The Macro segmentation is the Organizational, Industrial and geographical segmentation. Organizational segmentation is when one organization avails the service of another organization. In this case one company or organization can contact tourism agency for planning an official trip (Lacy, 2011). Industrial segmentation decides that what kind of organization within the industry the customers will will want. In this case the consumers will prefer a guided walking tour than a short, sightseeing one. The geographical segmentation is the area that the organization will cater to. In this case the customers will be from Britain and mostly of other European countries. The Micro segmentation is what the customers demographic, psychographic and buying behavior will make them buy. The Demographic Segmentation suggests the groups below: The Old and retired people either single or couple with a reasonable amount at deposit would be a primary market when targeting. Independent travelers, young professionals are the second market who likes to travel around historical places and discover something new. Inquisitive tourists and researchers would be another major portion who will avail of the firms services. The much in love couples and honeymoon couples will form the quantitative part of the market where there will be most concentration Finally the families and college youths will form the small fraction who will take up walking tours as an option sometimes. They will occasionally want something different and confined and would avail the extra services offered (Managementparadise.com, 2015). Psychographic segmentation suggests the peculiar behavior or the thinking that is done by the customer while buying a product. For Tourism industry the customers will avail of the service that provides the best of the essentials within a proper price range. The trips should be detailed and helped by an educated guide. There should be enough time spent on visiting each spot and the accommodation should be proper (Mathur, 2012). Based on the European clients, the customer of walking tours would be either very conservative or particular about their trip and accommodation or would be casual yet savvy about it. The Behavioral segmentation is done on the preference or on buying choice and behavior. The customers of the tourism industry are mostly brand loyal to the agencies to which they always refer to while planning a tour. Others are brand switchers and choose the option which is best suitable to the trip they are planning on going. The third segment is the new customers who will avail of the agencies services for the first time while planning for a trip (Michman, 2012). Target Market Strategy The target market is ultimately the target people to whom all the marketing communications will be directed to. The target market hence chosen is: People from Britain and the other European nations, also a few tourists from other continents will are the prime target. The Age group will between 25 years and above. It is because the demographic segment of retired people, researchers, and young singles would form the dominant segment of the market. Thus the targeting strategy will be directing the marketing message to this people and promoting the simple and hassle free service provided by CanTour, which is convenient and as well much knowledgeable about the areas they are catering to (MihaliÄ , 2011). Positioning The positioning of the product is done as a new firm in the scenario of Walking tours, which although is much below in the price graph is trying to reach the quality segment. The consumers will thus perceive it as a good quality service within the minimum price range (Miller and Washington, 2011). Marketing Mix Buyer Situation The marketing mix elements are affected by the target market and for each different segment different kind of marketing mix strategy has to be applied. This could be better understood by the given two examples. A retired couple with a little money wants to spend it on Touring Greenwich for the first time- the product or the service would be convenient yet should be of a minimum price with the basic of accommodations provided. They would travel by trains, boats and buses and would spend quality time touring each place. Their guide should be knowledgeable local. The promotional element would focus on the easy payment and moderate price strategy at the same time denoting the places that will be the focus of the tour. The media used should be radio and magazine advertisements and press releases or events on Greenwich tourism will be attracted through this. As it is a demographic buying situation the marketing mix elements will be used in an individualistic way focusing on ease and convenience (Mkt.unwto.org, 2015). Coach company organizing tours of London for American and Japanese tourist- the service would be elaborate, and detailed, led by expert guides who possess utmost information about each sight. The major historical places like Maritime Museum, Greenwich park and Queens house are to be focused on. The pricing would have a competitive edge so that the best of accommodations and food service could be provided. The idea will be to infuse the rich taste of London. Promotional activities will be huge focusing on advertisements on national and international channels, radio and major travel magazines. With effective personal promotions and web advertising. Online payment options should also be available so that the client can customize their trip options. In case of organizational buying, it has to be an extravaganza for turning the activity into a goodwill program (Nyc.gr, 2015). Repositioning The company now wants to reposition it in the market so that the educational group is largely attracted by the Campaigns. The marketing mix is thus changed according to the necessities of the segment. The repositioning would require placing the company in the light of the customers who would perceive it as educational, beneficial, resourceful as well as very convenient and comfortable. The people are researchers, historical enthusiasts and students from national and international cities. Hence the Product- should be focusing on providing the best of services which will be qualitative and quantitative. The guides should be highly knowledgeable locals, who will give a brief review of each sight. The Price should be at a competitive range, offering quality accommodation and food service. The entertainment factors and special charge of visiting historical places should also be counted. Organizational tours will require commissions. Also commissions from the retailers and wholesalers are also to be counted. The Place where the tours will focus on is the historical places like Maritime Museum and Queens House which will provide much information and insight to the enthusiasts. The Promotional campaigns would be firstly public relation campaign implying the benefit of the tours in making a study of the historical importance. Advertisements in magazine, radio and tv will be much needed, along with online promotions and payment systems (Perreault, Cannon and McCarthy, 2011). Finally a good Packaging must be provided so that it covers the areas of interests and the customers can choose and customize their tour package. Competitive Advantage Sustainable tourism refers to the participation in maintain a balance between environmental factors, socio-cultural activities and political leadership. There are a number of factors responsible for maintaining sustainability in customer satisfaction that acts as a competitive advantage over other tourism industries (Ritchie, Carr and Cooper, 2013). They are- Quality of service- The service quality that includes friendliness, language skills, professionalism and complimentary services helps in keeping the company at the edge. While choosing guides for tourism certain things should be kept in consideration. Environmental factors- CanTour focuses on sustaining the environment by not hampering the surroundings and taking care of the environmental standards. Nature and biodiversity should be preserved (Rmg.co.uk, 2015). Infrastructure- The infrastructural facilities like location, convenience and package plans form the base of any tourism industry. It is located on the coast of River Thames providing an excellent and central location. Safety measures- Customers should be ensured of safety. The tourist guide should have a background check before he is appointed as a guide. He should take care that the customers face no criminal activities. Proper checking should be done even in the customer baggage to assure there is no scope for terrorism (Royalgreenwich.gov.uk, 2015). Place In Marketing Mix Tourism marketing follows different distribution strategies. It is used a product of distribution where internet is used in a wide concept. The most famous tourism companies like Cox Kings, Thomas Cook, SOTC act as wholesalers and retailers both. The tourist destinations are chosen for Cutty Sark, Greenwich Park, Maritime Museum and Queens House. The main attraction of any tourism industry is its infrastructure. The uniqueness lies in the position of intermediaries for a tourism industry. There are two basic functions performed by tourism industry. They are facilitating the purchase of service in advance and to increase the number of points of sales away from the service location. The overall objectives of the tourism industry are reflected by different strategies of distribution. The retail agents buy tourism products in small quantities while the wholesalers buy the same in huge quantities. Internet is the latest mode to reach the customers and SOTC is the website where informatio n on tours can be generated. In addition, payment through credit card is possible where services in advance can be selected (Tadajewski, 2011). Effect Of Price On Organizational Objectives And Market Conditions CanTour frames projects and plans in such a way that develops various fields. It has affected Tourism industry as well as other categories like construction, exports, agriculture and transportation. These sectors have experienced growth in the society and positive benefits have been derived. The methodologies and insights are used to measure development outcomes across tourism sectors. CanTour has taken economic measures like employment, conversation and development to analyze work from different perspectives. This has likely increased revenue and impacts for livelihood. Economic Impact- Results are measured by impact of visitor on different sites on the basis on income generated, employment rate and demand of services. Social impact- They are measured through analysis and surveys conducted as secondary data. Number of employment generated, resident behavior and attitude to tourism and household income changes also measures them. Baseline Impact- CanTour analyzes visitors in terms of their average stay and average expenditure. Technical tools and assistance for training is provided to the baseline for evaluation. Environmental impact- This involves monitoring of wildlife, land and human resources. Tools and technical assistance is needed to measure indirect as well as direct impacts on environment. Market Analysis- Market demand and intelligence helps in preparing reports about visitor statistics, seasonal variations and forecasts, trends for tourism that help stakeholders of the industry to take operational and strategic decisions (Tourism Marketing Concepts, 2015). Promotional Activities The tourism board makes promotional activities in three forms- Workshops- Workshops proves to be an efficient marketing tool between tour operators and tourism industry. They work through personalized sales channel that link with a large number of businesses at a very low cost in a very less span of time. There are three kinds of workshops namely- Internal Workshop, Direct workshop and Reverse workshop. Trade visits and Fairs- The tourist board also makes promotions in fairs conducted in the city. They distribute pamphlets or may do it by sponsorship. They help in involving with a huge number of people and even private and public companies. Other activities- Other activities like conducting presentations and trips are made for promotion. Trips reflect the places or sites that are attractions of the city. In presentation, the specialties are shown in a slide format to companies who would like to sponsor through the tourism industry. Press reports and tourist awareness programs are conducted to enhance promotion. Online Promotion- Social networking sites like Facebook, Twitter, YouTube, Flickr, Instagram and various other sites are used for promotion of tourism industry. People who can act as a promotional activity by generating brand awareness regularly access these social networking sites (Tsiotsou and Goldsmith, 2012). Additional Elements Of Marketing Mix People- They play an important role in tourism. The behavior of local people towards tourist is very important. The tourism industry comprises of guides, the travel agents, sales staff, and staff of travel companies. The personnel who meet the needs of people on tours form an essential ingredient for tourism marketing. For dealing with the customers behind the counter is taken care by sales personnel. The tourist guides and staff interact with the tourists. They should undergo the special training that enhances their interpersonal skills (User, 2015). Process The process that follows tourism marketing is giving information on travelling. A series of operations that are needed for planning a tour should be itinerated. The planning and costing of tour is done that suits the requirements of an individual. The foreign currency guidelines should be given to people so that they are not duped. Physical evidence Physical evidences include brochures, visual images, layout and design of travelling, route maps, rules and regulations for tourist spot. These should be provided to tourists since tourism is a service and intangible in nature. Images for places and guidebooks should be provided which mention history behind places (visitlondon.com, 2015). Outline Marketing Mix i) Local people with children looking for an interesting half time activity- the service should be short stops at famous leisurely places, with a few culinary experiences. Price should be normal and below the competitive rate. The promotional activities will involve pamphlet distribution and radio ads. Local people with minimum knowledge could be used as a guide. The process will be planning and costing accounts and the physical proof consists of brochures and pamphlets along with tickets and tour guides (Weinstein and Weinstein, 2014). ii) Couples on holiday in UK looking for a romantic evening- the service would focus on beautiful places like Greenwich Park and Thames river. The focus will be on boat rides and dinner options in the place. The pricing would be costly so as to position it higher and provide an exotic experience. The promotional strategies will focus on advertisements on TV and magazines. When ads and online payment options are also a must in this case. The people involved must be trained and should possess good interpersonal skills. The physical proof will be brochures and tokens given as gifts on availing the service. Marketing To Travel Agents Individuals When marketing the service to a travel agent and when to an individual, different tactics have to be applied in each case by the Tourism Agency. In case of Travel agents the business is the first priority. There should be options of commissions when dealing with the travel agents. There will be bargaining pressure and a threat from rivals, hence the marketing tactics will involve offering cost benefit structure and easy pre-booking facilities to tap into the travel agent segment In case of Individuals more focus should be given on the service quality. Promotional strategies will be based on attracting customers. Online payment plans, detailed information provided on the tour and the attributes are also to be provided. They will be very particular about the accommodation, entertainment and food plans. Discounts should be provided to attract individuals in availing the offer. Thus these are two very different cases, for a travel agent its a professional attitude should be appointed on the other hand marketing to individuals require patience, quality service and out and out promotion (Weston and Mota, 2012). Promotion To Overseas Domestic Market While attracting overseas and domestic customers different approaches have to be taken. There is lot of foreign money earned through overseas clients and the government pressurizes to focus on this segment. On the other hand domestic market is essential to be kept entertained to generate goodwill and increase the domestic revenue. For Overseas Market-There is need for advertisements in TV and international magazines to reach the overseas customers. Focus should be on the world heritage sights and popular places. There should be a quality price range offered to the customers. There should be also advertisements in social media and web advertisement with much detail on the programs of accommodation food and entertainment factors associated with it. For Domestic Market- the focus should be on the aesthetic beauty of the places in Greenwich. The Londoners should feel proud about their sightseeing spots. All the promotional activities bring out the little details about Greenwich which are unknown even to the local market. Radio and magazines should carry ads and coupons on availing the service. The price should be put in a comparable price and advertisement through direct mailers, billboards is needed to attract the domestic client. When approaching the Canadian and Chinese clients focus should be on the attributes of Greenwich and why it is one of the unique and worth watching place in London. The presentation would include: A pictorial of the places of importance with detailing on each sight A list of places worth visiting beside this major sights and their historical link A list of the accommodation facilities, entertainment options and culinary experience which one might get must be jotted down. The price should be kept around the rates of Big players like Cox King The rich English feeling should be focused on so that the foreigners get a taste of Old London Easy online payment options should be available, customers should be able to choose the places they want to visit and the places they want to skip. Finally the views of the clients should be taken to organize the tour likewise. Conclusion Tourism combines various marketing strategies with volunteer opportunities that appeal a large number of tourists. Be in national level or an international level, tourism helps in installing water system in those localities where there is insufficient infrastructure. This is done to attract tourists by providing maximum facilities. A balance on tourist activities and its surroundings is to be maintained especially the environment. Products used should be environmental friendly and also a limitation is put on visitors to outdoor area. Marketing for tourism might be expensive in nature especially if it is done on an international level. Various funding sources for tourism agencies are taxes. If there are a large number of tourists attracted to a specific place or country or several neighboring countries, it is sensible to make marketing approaches there to make a larger reach among people. Partnerships are provided in this case. A position analysis is done to keep in check with the com petitors. Target market is selected based on profiles of travelers (Www2.gre.ac.uk, 2015) References Blythe, J. 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