reaching new heights... offerings, distribution, and pricing chapter x integrating marketing in the...
TRANSCRIPT
![Page 1: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/1.jpg)
Reaching New Heights . . .Reaching New Heights . . . Reaching New Heights . . .Reaching New Heights . . .
Offerings, Distribution, and PricingOfferings, Distribution, and PricingChapter XChapter X
Offerings, Distribution, and PricingOfferings, Distribution, and PricingChapter XChapter X
Integrating Marketing in the Leisure IndustryIntegrating Marketing in the Leisure Industry
![Page 2: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/2.jpg)
Agency OfferingsAgency OfferingsAgency OfferingsAgency Offerings
Products - Physical goods that are presented to the consumer.
Services - Amenities that support the primary product offering.
Facilities - Physical structures available to consumers.Programs/ Events - Activities that complement products
offered to consumers.
Delivery - Impacts the experience received by consumers.Policy/ Procedures - Establishing boundaries for
participation. Physical Environment - Physical attributes of the agency
itself.
![Page 3: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/3.jpg)
Categories of OfferingsCategories of OfferingsCategories of OfferingsCategories of Offerings
Intangible
Programs
Services
Delivery
Policies/procedures
Tangible
Product
Facility
Physical environment
![Page 4: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/4.jpg)
Product Life CycleProduct Life CycleProduct Life CycleProduct Life CycleI N T R O D U C T I O N
G R O W T H
M A T U R I T Y
D E C L I N E
S A L E S
TIME/STAGES
Product Development
Modification
New Market
![Page 5: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/5.jpg)
Product IntroductionProduct IntroductionProduct IntroductionProduct Introduction
• Product unknown.• Sales/participation is low/non existent and over time
begins to emerge and grow.
• Pricing may be high to capture top of market or recover costs or low to penetrate the market and spur
consumption. • Promotional statements are geared toward the needs
of the targeted markets.• Agencies utilize heavy advertising, promotion, and
public relations tools during this phase to introduce the offerings and induce trial and use.
![Page 6: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/6.jpg)
Product Growth StageProduct Growth StageProduct Growth StageProduct Growth Stage
• Sales/participation is growing, as competitors are as well.
• The product is becoming well known and brand recognition is emerging.
• Pricing tends to be higher as demand increases as well.• Distribution systems are expanded.• Quality issues are emerging.• Agencies place continued emphasis on advertising,
promotion and public relations, but also begin to utilize other tools more moderately such as sponsorship, personal selling, stewardship and internal marketing to build brand loyalty.
![Page 7: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/7.jpg)
Product MaturityProduct MaturityProduct MaturityProduct Maturity
• Sales/participation has flattened or is slightly falling.• Large number of competitors exist on the market.• Agencies focus their efforts in building brand loyalty.• Promotional statements tend to be reminder oriented,
positioning against competitor while expanding on competitive advantages.
• Less emphasis is placed on advertising and public relations while increased focus on personal selling, sponsorship, stewardship, community relations and internal marketing to build and maintain loyalty exists.
![Page 8: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/8.jpg)
• Revenues are extremely low and competitors have reduced to only the strongest and most successful.
• Loyalty practices are the most successful tools to use as agencies prepare for reemergence into the introduction stage.
• Three main strategies exist for reemergence:Product modificationExpanding to new market segmentsDevelopment of new offerings
Product DeclineProduct DeclineProduct DeclineProduct Decline
![Page 9: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/9.jpg)
DistributionDistributionDistributionDistribution
• Distribution is the way in which a leisure service agency connects to consumers to ultimately provide a leisure service experience.
Physical source
Physical location
Physical delivery
![Page 10: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/10.jpg)
Physical SourcePhysical SourcePhysical SourcePhysical Source
Links product to user and user to product.
Hotel - consumer
Hotel - travel agent - consumer
Hotel - tour operator - travel agent – consumer
WHY?
Reach more consumers.
Provide alternative ways to reach.
Maximize agency resources.
Better meet consumer needs.
![Page 11: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/11.jpg)
Physical LocationPhysical LocationPhysical LocationPhysical Location
• Provide golf clinics at a local agency during lunch hours.
• Provide aerobic classes at an off site location.
• Oakland County Mobile Recreation.
![Page 12: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/12.jpg)
Physical DeliveryPhysical DeliveryPhysical DeliveryPhysical Delivery
• Train staff to work with seniors.• CPR and First Aid Certified.• Develop a service recovery system to gain feedback.
![Page 13: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/13.jpg)
PricingPricingPricingPricing
Steps taken in any pricing decision:
• Identifying the pricing objective• Assessing the pricing variables• Determining the price• Evaluating the pricing decision
![Page 14: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/14.jpg)
Identifying the Pricing ObjectiveIdentifying the Pricing ObjectiveIdentifying the Pricing ObjectiveIdentifying the Pricing Objective
• We want to make money.• We want to break even.• We want to have as much participation as possible.• We want to turn off certain market segments or
demarket.
![Page 15: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/15.jpg)
Assessing the Pricing Assessing the Pricing VariablesVariables
Assessing the Pricing Assessing the Pricing VariablesVariables
• History• Demand• Competition• Willingness to pay• Cost• Margin Issues
• Consumer tastes• Consumer income• Mob effect• Price range• Cost of info search• Perception of value• Availability of substitute products
![Page 16: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/16.jpg)
Determining the PriceDetermining the PriceDetermining the PriceDetermining the Price• Variable/Differential• Market Skimming/ Exclusivity• Market Penetration/ Discount• Breakdown• Pay One Price/Pay As You Go• Bundling/Unbundling• Captive• Psychological• Hidden Costs• Fixed to Variable/ Creative Variable• Price Performance• Differing Segments• Product Line
![Page 17: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/17.jpg)
Pricing StrategiesPricing StrategiesPricing StrategiesPricing Strategies
1. Differential Pricing– Selling the same
product/service to different buyers at different prices
– Can be illegal…– Legal if…– Second Market
Discounting • Different prices
charged to different segments of consumers
![Page 18: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/18.jpg)
Pricing StrategiesPricing StrategiesPricing StrategiesPricing Strategies
2. New product pricing strategy (org sets price levels for products being introduced)
• Examples– Penetration Pricing-product introduced at a low
initial price relative to the competition– Price Skimming-org sets high prices and charges
more than the competition
![Page 19: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/19.jpg)
Pricing StrategiesPricing StrategiesPricing StrategiesPricing Strategies
3. Psychological Pricing -consumer’s emotion and image rather than economics
• Examples– Prestige Pricing– Reference Pricing– Odd-even pricing
![Page 20: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/20.jpg)
Pricing StrategiesPricing StrategiesPricing StrategiesPricing Strategies
4. Product-Mix Pricing -profitability of entire product line rather than setting prices for individual products independently.
Examples-sporting events, baseball cards, cruises– Examples
• Bundle pricing• Captive product pricing
![Page 21: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/21.jpg)
Pricing StrategiesPricing StrategiesPricing StrategiesPricing Strategies
5. Cost-Based Pricing-the org examines all of the costs associated with producing the service before pricing.
![Page 22: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/22.jpg)
• Cost Plus-price =computing the total cost (fixed + variable costs) of producing the product and then adding an additional cost to achieve the desired profits.
• Target Profit-approx. prices are set based on the target profit marketers have determined when setting price objectives
• Break-even-determine the number of units it will have to sell at a given price to break even
![Page 23: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/23.jpg)
Break Even FormulaBreak Even FormulaBreak Even FormulaBreak Even Formula
• Break Even Point =
Fixed cost
Price – approx. costs per person
Example:
$3,000
$15-$7
Break even Point=375 (race entries)
![Page 24: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/24.jpg)
Pricing StrategiesPricing StrategiesPricing StrategiesPricing Strategies
6. Price Adjustments-caused by competition, adjustments made to create demand
• Examples– Price reductions-enhance
sales
– Price increases-keep up with cost inflation or there is an excess demand
– Price Discounts• Quantity• Seasonal
![Page 25: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/25.jpg)
Evaluating the Pricing DecisionEvaluating the Pricing DecisionEvaluating the Pricing DecisionEvaluating the Pricing Decision
• Monitoring participation and/or revenue or profit data. • Analyze cause/effect relationships to prices. • Understand the price sensitivity.
![Page 26: Reaching New Heights... Offerings, Distribution, and Pricing Chapter X Integrating Marketing in the Leisure Industry](https://reader035.vdocuments.mx/reader035/viewer/2022062322/56649e365503460f94b24e16/html5/thumbnails/26.jpg)
Yield ManagementYield ManagementYield ManagementYield Management• A term concerned with understanding the balance
between the amount an agency sells of its offering at the best price possible.
• An agency determines its yield by comparing potential inventory to actual inventory.
• Yield management allows an agency to strategically organize the agency’s inventory of offerings in a way to be sold as effectively as possible to achieve agency objectives.
• Yield management attempts to maximize the opportunities for agencies, it combines the elements of pricing and distribution to maximize opportunities for agencies.