chapter13 pdf

7/29/2019 Chapter13 PDF

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Chapter 13

Place:Distribution Channel andthe Travel Trade


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Chapter Objectives

1. What are the different kinds of marketingchannels.

2. Distribution Channel in Tourism and

Hospitality Industry.a. Define the terms of distribution mix and travel

trade.

b. List the major travel trade intermediaries.

c. List steps involved in marketing to the traveltrade.


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Objective 1

1. What are the different kinds of

marketing channels?


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What is a Marketing Channel??

A Marketing Channel is a network of allparties involved in moving products or

services from producers to consumers or

business customers.

A Marketing Channel is the structure

linking a group of individuals or

organizations through which product or

service is made available to the consumer

or industrial user.


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Marketing Channels

MarketingChannel

Retailer

Whole-salers

Agent


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Channel Structure for Consumer Goods

Producer Consumer

ProducerConsumerRetailer

Producer ConsumerRetailerWholesaler

Producer RetailerAgent Consumer

1

2

3

4


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1. Producer-Consumer (direct supply channel)

Manufacturers

Customers

The manufacturer and consumer deal directly with each other.

E.g. Factory shop, pick-your-own fruit farm and door-to-door

selling.


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2. Product-Retailer-Consumer (Short Channel)

Manufacturers

Customers

Retailer

Very popular foe larger retailers because they can buy in

large quantities, obtaining a special price (by negotiating the

prices) and delivery arrangements.


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3. Producer-wholesaler-retailer-consumer

(Long channel)


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4. Producer-agent-wholesaler-retailer-consumer

Producer RetailerAgent Consumer

The longest and most indirect channel.

This model is widely used by small organizations who trying

to sell their products in remote markets or when themanufacturer is trying to enter to unknown expertmarket.

Manufacturer chose the agent who have local knowledge,

contact and expertise in selling into the country.

Agentgets commission from manufacturer.

The problems of this channel is manufacturer have totrust the quality of the agents know ledge, commitment andselling ability.


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Distribution Channel for

Tourism and Hospitality Industry

Objective 2


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Distribution Mix and the Travel Trade

Distribution Mix is the combination of thedirect and indirect distribution channels a

hospitality and travel organization uses toreserve and deliver its service to customers.


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Direct Distribution = when the organize assumestotal responsibility for promoting, reserving, and

providing service to customers (Not working withtravel trade intermediaries).

Indirect Distribution = when other organization

or other companies are responsible for promoting,reserving and providing service to customers

(working with travel trade intermediaries/third

party intermediaries).

Indirect Online Distribution Channel = sellingproducts/service through the Internet.

E.g. Agoda.com, Booking.com, Expedia.com


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The Hospitality and Travel Distribution System

Individual and Group Customers

Carriers, Suppliers, Destination Marketing Organizations

Lodging Restaurant/Food Service Airline/rail/bus/ferry

Cruise Line Rental Car

Attractions Casino DMO

Tour Wholesalers

Retail Travel Agent

Corporate Travel

Manager

Convention/

Meeting planners

Incentive Travel

Planners


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Specific Roles and benefits of

Travel Trade Intermediaries for tourism and Hospitality Industry

1.) Retailing the services suppliers, careiers, DMOs at location

convenient for travelers.

2.) Expanding the distribution network for tourism and hospitality

products.

3.) Providing specialized, knowledgeable advice to travelers on

destinations, prices, facilities, schedules, and services.

4.) Assembling vacation. Holiday packages by bringing together an

array destination and the services of suppliers and carriers at all

inclusive price.5.) Organizing and coordinating convention, conferences, and

meeting for associations, corporations, and other organization.

6.) Operating and guiding group tour.


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Individual Travel Trade Intermediaries

Retail travel agents Tour wholesalers and operators Corporate travel managers and agencies Incentive travel planners Convention/meeting planners

Online Travel Companies


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Retail travel agents

Selling the products/services from supplierscarriers and other travel trade intermediaries

in the form ofcommission.

Customers are charged charged in form ofService fees.

Hotel booking, Airline/Cruise/Bus tickets, Traveler

cheque


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Tour wholesalers and Tour operators (1)

Who negotiate price and block the space with supplierand carriers and markup to all elements

to determine an all-inclusive price.

They bought product in bulk or bulk buying and resoldto customers through retail agency.

A tour Operator = Tour Wholesaler!!!?

Inbound Tour Operator specialize in

providing local service to other tour

operators in specific nation or destination.


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Negotiate booking, fares, rate with carriers/suppliers

Establish tour/ package price, print brochures and give totravel agencies

Update information in website

Tour wholesalers and Tour operators (2)

Printed online material

(advertisements)

Remark!!: Wholesalers also a

Trade Advertising


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Corporate Travel Managers and Agencies

A individual departments, divisions, or even

managers that is responsible for booking

their own flights, rooms, and rental cars

Monitor and analyze travel expenditure at a company

wide-level.

Set, communicate, enforce, and adjust travel policy.

Negotiate corporate travel contracts and discount Create strategic meeting management programs

(SMMPs).

Mandate an online system


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Incentive travel planners

Incentive travel is a motivation tool forcompanies/organization by rewarding employees, dealers,

and other who meet or exceed objective, increase

production, increase sell, and enhancing morale andgoodwill.

Incentive Travel Planner are specialized tourwholesalers.

They tailor-made package (transportation, accommodations,meals, etc.)

They negotiate price/block space with carrier and suppliers and

mark-up commission (planning service fees).


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Convention/meeting planners

Convention and Meeting = MICE (Meeting,incentives, Conventions, and Exhibitions).

Convention/Meeting Planner plans and coordinates

their organizations external meeting event. Work for associations, corporations, large non-profit

organizations, government agencies, and educational

institutions.


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Online Travel Companies

Benefit of the online travel companies.

Ability to self-book travel online.

Assistance in planning travel trip.

Online pricing comparisons.

Convenience of accessing travel information.

Immediate confirmation of travel booking.

Instant access to travel information

Potential of securing lover prices on hospitalityand travel services.

Marketing to Travel Trade


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Marketing to Travel Trade

(A three-step Process)

Research and SelectTrade Segment

Decide on thepositioning approach

and marketingobjective

Establish apromotional mix fortravel intermediaries


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1. Key Feeder and market areas - Cities or Regions.

2. Major corporate travel and convention/meeting

accounts.

3. Tour wholesalers and incentive travel planners

1. Research and Select Trade Segment


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Positioning approach

Establish a distinctive image or position in travel

trade.

Marketing objective.

5% increase in the number of travellers.

2. Decide on the positioning approach and marketing objective


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(1)Trade Advertising.

(2) Directories and Computerized Databased.

(3) Personal and Telephone Selling.(4) Trade Sale Promotion.

a. Familiarization Trip or Farms.

b. Contest, Sweepstakes, and Incentive Programs.c. Specialty Advertising Giveaways.

d. Trade Shows.

3. Establish a promotional mix for travel intermediaries


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(5) Merchandising and Brochures.

(6) Public Relation and Publicity.

(7) Cooperative Marketing (Partnership).

(8) Website Access.

3. Establish a promotional mix for travel intermediaries


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Thank youfor your attention!!Questions?

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