MARKETING

DTC Principles Tourism II

by: ellen castillo

Unit Objec t ives :• Explain the basic concepts of marketing

• Identify the special dimensions of marketing different forms of tourism.

• Differentiate between marketing and selling/promotion.

• Discuss the basic marketing techniques.

Unit Topics:• What is Marketing?

• The Evolution of Marketing

• Different Definitions and Concepts of Marketing

• The Concept of Value within Tourism

• The Difference between Marketing and Selling

• Different Business Philosophies

• Marketing Orientation

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• Tourism as a Service Product

• The Characteristics of the Service Product

• Other Aspects of Tourism as a Service Product

• Tourism Products and Risks

• The Adoption of a Marketing Operation

• Criticism of the Marketing Concept

• A Societal Marketing Approach

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Industry(a collection of

sellers)

Market(a collection of

buyers)

Communication

Goods/Services

Money

Information

Simple Marketing System

Marketing

• Process of planning and executing the conception, pricing, promotion and distribution of ideas, goods, services to create exchanges that satisfy individual and organizational goals.

• “Involves the interactions and interrelationships among consumers and producers of goods and services, through which ideas, products, services and values are created and exchanged for the mutual benefit of both groups.”

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The history of marketing and modern business practice have developed in three distinct stages.

1. The production era, based on the notion that if products were priced cheaply, they would sell regardless of consumer preferences. this was deemed an inward, product-oriented focus with little concern for consumers.

2. The sales era, where selling was the prime focus regardless of the market’s willingness to accept the product.

3. The marketing era, replacing the preceding approaches; businesses now produced products they could sell which were tailored to consumer needs to satisfy the purchaser, effectively making the organization more outward looking.

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The important factors that have ushered in marketing during the fast half-century are as follows:

• The increases in demand were at a lower rate than the rises in productivity.

• The consumer becoming more affluent and therefore it was possible to develop products that could be using a range of non-price attributes.

• The distance between the tourism product provider and tourist has been continually increasing.

• New tourism and hospitality product were being launched which required more emphasis on marketing.

• As society developed, the mass market splintered into a number of sub-markets, while at the same time the mass market became increasingly difficult to reach.11/14/12

Different definitions and concepts of marketing

The concept of value within tourism

• Companies have to find ways to ensure they optimize the delivery of value.

• The value of tourism incorporates a number of different aspects which include the perception of price, quality and image as well as the economic and social aspects of the consumer.

•

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A system for delivering value

Approaches Uncovering value needs Developing value Delivering value

Gathering/analytical Data/feedback of company Operations/customer Logistics/product

representatives, surveys, etc. interfaces and touch points quality service

Organisational Interpretation of customer Training/motivation of staff Improved attitudes

Requirements and resultant and working with suppliers and behavior of

Expected organizational who also acid quality employee interfaces

competencies

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Product perceived value is based upon:

• Actual price asked and the relativity to prices for the same or similar product offered elsewhere.

• Perceived quality, service and image associated with the brand product.

• Convenience of purchasing method or channel, and its congruence to the needs of the customer.

• Consumer difficulty in ability to assess the benefits/relative price of the product.

• Experience associated with the purchase or consumption process.

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The Differences between Marketing and Selling

“Selling and marketing are antithetical rather than synonymous or even complementary. There will always, one can assume, be a need for some selling, but the aim of marketing is to make selling superfluous.”

Ducker (1973:64)

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The sales and marketing concepts compared

The sales concepts focuses on products and uses selling and promotion to achieve profits through sales volume

The marketing concept focuses on customer needs and utilizes integrated marketing to achieve profits through customer satisfaction.

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The sales and marketing concepts compared

Focus Means End

Sales → Selling/products → Promotion →Profits through sales volume

concept

Marketing → Customer needs → Integrated →Profits through customer

Concept marketing to specific satisfaction

segments

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Four possible business philosophies:

1. Product-orientated company

2. System/technology-oriented company

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Product creationSalesPromotion

Technology Product Creation

Product Formulation

Promotion Sales

Four possible business philosophies:

3. Market-orientated company

4. Integrated company

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Marketing Research

Product Creation

Product Formulation

Promotion Sales

Marketing Research

Promotion SalesProduct Creation

Product formulation and company-wide marketing principles incorporated

Marketing Orientation

• It is a management orientation or philosophy.

• It encourages exchange to take place.

• It involves long- and short-term planning.

• It requires efficient, cost effective methods.

• It requires the development of an integrated company environment.

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Transaction Marketing Relationship Marketing

Short-term orientation: sale as end result Long term orientation, the sale is only the beginning

‘Me’ orientated ‘We’ orientated

Focus on achieving a sale Focus on retention and repeat sales

Emphasis on persuasion to buy Stress on creating positive relationships

Need to win, manipulation Providing trust and service

Stress of conflict of achieving a transaction Partnership and cooperation to minimize defection and provide longer-term relationships (with customers or strategic alliances, joint ventures, vendor partnering, etc.

Anonymous customer won by conquest in a carefully planned event Individual profile of customer known so that a continuing process can arrange

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The difference between transaction and relationship marketing

Tourism as a Service Product

Products

Service Good

Intangibility More Tangible

Perishability Often Storable

Inseparability Standardisable

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The Characteristics of the Service Product

Intangibility: it cannot be easily evaluated or demonstrated in advance of its purchase.

Perishability: service products such as tourism, unlike goods, cannot be stored for a sale on a future occasion.

Inseparability: both service provider and costumer are present when the service function occurs.

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Other Aspects of Tourism as a Service Product

1.Shorter aspects of tourism as a service delivery.

2.More personal.

3.Growing use of self-service.

4.Greater significance on managing evidence.

5.Complementarity is greater.

6.Easier copying of services.

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Tourism Product and Risk

• Economic Risk

• Physical Risk

• Performance Risk

• Psychological Risk

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The Adoption of a Marketing Operation

Tourism marketing involves a number of special characteristics:

• Marketing is a philosophy with the overriding value that the decision-making process of any organization has to be led by the consumer’s needs, the marketplace and the company’s assets and resources.

• Successful marketing requires a special organization structure that believes in integrating the principles of consumer orientation throughout the organizations.

• Marketing requires innovative methods of thinking and planning so that new ideas are generated to take advantage of opportunities or to improve existing methods of marketing.

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Criticisms of the Marketing Concept

• Environmental marketing impact

• Overemphasis on profitable products

• Invasion of privacy

• Waste of resources on tourism market

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A Societal Marketing Approach

• It is important to recognize that consumers are now better educated and are competent to select products that are not creating undue problems to society.

• If organizations or their products create problems, there are articulate pressure groups and government legislation available for consumer and environmental protection.

Three basic issues to consider:

• Consumerism

• Corporate social responsibility

• Ethics

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Some Points Relevant to Societal Marketing Approach

• Good business managers should be socially responsible to all stakeholders related to the company and tourism offer so as to minimize social costs.

• Managers should be honest in claims and promotions, not be deceptive or agree to misleading advertising.

• The products offered should not cause harm or unacceptable tourism impact and managers should communicate any risks which are known to be associated with any product.

• Marketers should undertake not to adopt sales techniques under the guise of its being research.

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Thank you for listening!

GOD bless

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