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Analyzing and
Managing Tourist
Transport
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Subject Areas that have a direct
contribution to the analysis of
tourist transport system
Economics
Geography
Marketing
Management
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ECONOMICS
According to Craven (1990) Economics
is concerned with the economy of
economic system ad the problem of
allocating resources is a central theme
of economics, because most resources
are scarce
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Resources :
Natural resources ( land )
Labor ( human resources)
Capital (man- made aid to assist in producing goods )
Methods and Machines
Collectively these resources constitute the factors of production which are used to produce commodities
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The commodities can be
divided into :
Goods ( tangible products such as an
aircraft )
Services ( intangible items such as in-
flight service )
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Microeconomics :
The firm
The consumer
Production and Selling
The demand for goods
The supply of goods
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Macroeconomics :
How the national economy operates
Employment and unemployment
Inflation
National production and consumption
The money supply in a country
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Demand :
Within economics, the concern with the
allocation of resources to satisfy
individual’s desire to travel means that
transport economist examine the
demand for different modes of travel
and the competition between such
modes of in relation to price, speed
and convenience
What affects people’s travel behavior
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Supply :
Supply of a commodity, which is often
seen as a function of its price and the
price of alternative goods
Price is often influenced by the cost of
the factors of production
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Supply
From the transport operator’s
perspective, the main objective in supply
terms is to maximize profitability from
the available capacity, which is usually
expressed in terms of the load factor
Transport companies can maximize
passenger revenue by minimizing costs
and pricing their product or service at a
competitive rate.
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The supply of tourist transport
can be characterized by :
Major capital requirements for passenger
carriage (cost of the aircraft, passenger trains
and ferries)
Government regulations and restrictions to
monitor the supply which is determined by
state policy
Competitive reaction from other business
involved in tourist transport
A high level of expertise required to operate
and manage tourist transport enterprises
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The pricing of Air travel -
The various price strategies are:
Single - pricing , where a uniform price is charged for passengers on the same flight
Multiple – pricing, which involves segmenting the market and offering empty seats at a lower price
Yield management, involving management planning, and computer programming to optimize revenue by selecting the optimum mix of travelers
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The pricing of Air travel -
The various price strategies are:
Yield management, enhances revenue
from the seat allocation, by restricting
the availability of lower – priced fares,
airlines are able to safeguard against
revenue dilution in an environment
where many of the costs of airline
operations are relatively fixed for each
departure
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The pricing of Air travel -
The various price strategies are:
Leg- Based pricing , where seat
allocation is used to maximize revenue
on each sector of a flight
Origin – destination pricing models ,
where complex linear programming
techniques are used to compare
whether a multi-leg passenger trip will
generate more revenue than a single leg
trip , and to allocate seats accordingly
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GEOGRAPHY:
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Leisure Time
Leisure
The time available to an individual when work,
sleep and other basic needs have been met.
Recreation
Pursuit engaged upon during leisure time
The recreation activity continuum
Home-
based
recreation
Reading,
gardening,
watching TV,
socializing
etc.
Daily
leisure
Visiting
theatres or
restaurants,
going to the
mall, sports
etc.
Day trips
Visiting
attractions,
picnicking
etc.
Tourism
Temporary
movement to
destinations
outside
normal home
and work
place.
Geographical range
Home Local Regional National International
Work
time
Business
Tourism
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Geography and
Tourism
When we study the geography of travel and tourism, three key concepts need to be considered:
1. spatial scale
2. the geographical components of the tourism system
3. spatial interaction between the components of the tourist system
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Spatial scale
This idea of scale, keeps in focus the area being dealt with
From the geographical point of view, tourism can be considered from number of scale
- world scale
- regional scale
- local scale
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The geographical components
of the tourism system
Tourist generating areas - represent the homes of tourists, where journeys begin and end.
Tourist receiving areas - attract tourists to stay temporarily and will have features and attractions that may not be fund in the generating area
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Transit routes – link these two types of areas and are a key element in the system as their effectiveness and characteristics shape the volume and direction of tourist flows.
- Such routes represent the transport component of the tourism industry.
The geographical components
of the tourism system
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Spatial interaction between the
components of the tourist system
Tourist flow
An understanding of tourist flow is
critical for managing the environmental
and social impacts of tourism , securing
commercial viability of the tourism
industry and for planning new
developments
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Explaining tourist flow
Factors that helped to explain these flows:
1. Distances between countries ( the greater
the distance, the smaller the volume of
flow)
2. International connectivity ( shared business
or cultural ties between countries
3. The general attractiveness of the country
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MARKETING:
Kotler and Armstrong (1991), marketing
is a process whereby individuals and
groups obtain the type of products or
goods they value
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MARKETING:
These goods are created and
exchanged through a social and
managerial process which requires a
detailed understanding of consumers
and their wants and desires so that
product or service is effectively
delivered to the client or purchaser
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Within Marketing
Three Areas exist:
Strategic Planning
Marketing Research
The marketing mix
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Strategic Planning:
Formal planning process
The process of developing and maintaining a strategic fit between the organization’s goal and capabilities and its changing marketing opportunities
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Organizations
Mission To serve great tasting food, bringing the joy of eating to
everyone.
Vision We are the best tasting QSR..
The most endearing brand that has ever been...
We will lead in product taste at all times...
We will provide FSC excellence
in every encounter...
Happiness in every moment...
By year 2020, with over 4,000 stores
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Organizations
Values
Customer Focus
Excellence
Respect for the Individual
Teamwork
Spirit of Family and Fun
Humility to Listen and Learn
Honesty and Integrity
Frugality
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Organizations
Globe Telecom is a leading
telecommunications company in the
Philippines. We continue to grow and
engage our customers through our clear
commitment of "Making Great Things
Possible."
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Organizations
Service excellence
PAL's excellent service has won the hearts of travelers worldwide. This trademark has distinguished it from the pack and has stood guard in an environment that has grown more competitive by the day.
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Strategic Planning:
SWOT Analysis
S – Strength
W – Weaknesses
O – Opportunities
T – Threats
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Marketing Research :
is an organized process associated with the
gathering, processing, analysis, storage and
dissemination of information to facilitate and
improve decision making
It incorporates various forms and research
undertaken by organizations to understand
their customers, markets and business
efficiency
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Marketing Mix :
is the mixture of controllable marketing
variables that the firm uses to pursue
the sought level of sales in the target
market
There are four main market variables :
product formulation, price, promotion
and place
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Marketing Mix :
Product formulation – the ability of the
company to adapt to the needs of its
consumers in terms of the services it
provides
Price – the economic concept used to
adjust the supply of a service to meet
the demand, taking account of sales
targets
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Marketing Mix :
Promotion – the manner in which the
company seek improve customers knowledge
of the services it sells so that those people
who are made aware may be turned into
actual purchasers
- To achieve promotional aims,
advertising, public relations, sales and
brochure production functions are undertaken
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Marketing Mix :
Place – the location at which
prospective customers may be induced
to purchase a service - the point of sale
( Travel Agency )
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Airline Marketing :
Is to bring together the supply of air
services, which each airline can largely
control , with the demand, and which
can influence but not control and to do
this in a way which is both profitable and
meets the airline’s corporate objectives
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Airline Marketing
Strategies:
Strategic Alliances
Examples:
Oneworld is a global alliance that brings
together ten of the world's biggest and best
airlines, all committed to providing world-
class service and value.
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Airline Marketing
Strategies: Strategic Alliances
Examples:
StarAlliance - the airline network was established in 1997 as
the first truly global airline alliance to offer customers
worldwide reach and a smooth travel experience.
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Airline Marketing
Strategies: Strategic Alliances
Examples:
Sky Team -
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Airline Marketing
Strategies:
Acquisition
Joint Ventures
Franchising
Ancillary Services
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The role of marketing in the
management of airline services:
1. Identify markets and market segments
using research methods and existing
data sources and traffic forecasts.
2. Use the market analysis to assess
which products to offer.
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The role of marketing in the
management of airline services:
3. Develop a marketing plan to plan and
organize the selling of the products
4. Monitor and review the airline’s ability
to meet service standards , assessed
through sales figures, customers
surveys, analysis of complaints and
long term planning to develop new
service and product features
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MANAGEMENT:
Getting things done in organizations
through other people
Is concerned with the ability of
individuals to conduct, control, take
charge of, or manipulate the world to
achieve a desired outcome
Management occurs in the context of
formal environment – ORGANIZATION
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Management Process :
Planning - so that goals are set out
and the means of achieving the goals
are recognized
Organizing – whereby the work
functions are broken down into a
series of tasks and linked to some
form of structure
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Management Process :
Leading – which the method of
motivating and influencing staff so
that they perform their tasks
effectively
Controlling – which is the method by
which information is gathered about
what has to be done
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Airline Management :
The process whereby individual ( and
group of) airlines seek to organize,
direct and harness their resources,
personnel and their business activities
to meet the needs of their organization
and customers in an effective and
efficient manner