R. Cleverdon

2. Marketing Strategic Approaches

World Tourism Organization Manila, 20 – 22 March 2006

R. Cleverdon

SESSION COVERAGESESSION COVERAGE•Marketing policy central to overall tourism development policy – so need for a strategic marketing planning approach

•Characteristics of tourism that affect marketing strategy

•Process of strategic marketing planning within overall planning

•Strategic marketing planning based on differentiation & resource:

market matching

•Taking account of priorities of different stakeholders

•Marketing tools & techniques - introduction

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

UNDERSTANDING TOURISM DESTINATIONS

UNDERSTANDING TOURISM DESTINATIONS•What is a tourist destination?

* one product – but also many

* many stakeholders with different goals

* both physical & socio-cultural aspects

* mental concept for potential visitors

* subject to a wide range of influences

* subject to historical, real & fictitious events

* evaluated subjectively for value-for-money

* no two destinations the same!!

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

TOURISM’S SPECIAL FEATURESTOURISM’S SPECIAL FEATURES•Huge range of impacts – economic, socio-cultural, environmental?

•Special facilities, training, institutions, laws etc

WHY – because tourists represent an addition to the resident population with all the needs of any population and more

•What is perception? – what is reality?

YOU CANNOT TEST DRIVE A HOLIDAY

IN TOURISM, THE PERCEPTION IS THE REALITY

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

KEY TOURISM MARKETING PROPOSITIONS

KEY TOURISM MARKETING PROPOSITIONS•1. Marketing – products are designed, adapted & promoted to

meet the long-run expectations & interests of prospective customers

2. Services marketing – peculiar characteristics of inseparability & perishability call for a different application of the traditional marketing mix

3. Tourism marketing – shaped by the nature of demand and operating characteristics. Forms of promotion have their own characteristics, distinguishing their use from other sectors.

Middleton, V.T.C. & Clarke, J Marketing in Travel & Tourism

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

UNDERSTANDING CONSUMERS’ NEEDSUNDERSTANDING CONSUMERS’ NEEDSCharacteristics of Tourism with Implications for Marketing

* fragmentation of supply

* interdependence & complementarity

* rigidity of supply

* fixed in time & space

* intangible: “expectation-experience-memory”

* price elasticity of demand

* seasonality

* consumer part of the product

* importance of intermediaries

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

PROCESS OF MARKETING PLANNINGPROCESS OF MARKETING PLANNING

Marketing plan is a navigational chart – enabling the organisation/destination to realise its goals

Typical plan structure: executive summary, situation analysis, objectives & goals, market segments, marketing strategies, marketing mix, resources, implementation, assessment

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

PRODUCT >< MARKETING PRODUCT >< MARKETING In a marketing mix, the product comes first

BUT - in tourism the role of marketing can precede the development of the product – remember the importance of mental concepts

Marketer gathers information on the expectations of customers

For a destination, the customer can be:

* its citizens

* investors

* tourists

* the travel trade

* others?

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

PRODUCT >< MARKETING PRODUCT >< MARKETING Marketer’s task – to communicate to statal decision makers the features & benefits each of the customer groups want & how to reconcile their often competing & contradictory needs

Marketer participates in the design of the destination’s products;

* branding & PR campaign

* investment laws & regulations

* development & presentation of attractions

* promotion of export products

* fostering of positive relations with neighbours, NGOs & international organisations

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

DESIGNING PRODUCTS DESIGNING PRODUCTS Leverage factors:

* natural endowments

* acquired endowments, public goods, externalities

* risk mitigation

* economic prowess

Products & brands not fixed & unalterable

Maintaining the destination’s brand & promoting its products are ongoing tasks

R & D needed – just like a corporate entity

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

STRATEGIC MARKETING PLANNING STRATEGIC MARKETING PLANNING Strategy – long term

* where are we now?

* where do we want to get to?

* how do we get there?

Key components of strategy:

* goals & objectives

* images, positioning, branding

* strategies & programmes

* budget

* review & evaluation

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

TACTICAL MARKETING PLANNING TACTICAL MARKETING PLANNING Tactics – short term

Respond to market conditions & competitors’ activities

Tactical marketing incorporates:

* objectives & targets

* mix & budget

* action programmes

* monitoring & control

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

DISTINGUISHING: STRATEGY & TACTICS

DISTINGUISHING: STRATEGY & TACTICS Three strategic concepts absent in tactical marketing:

1. Strategic business units & business portfolio analysis

2. Product: market growth models

3. Corporate & product positioning

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

STRATEGIC MARKET PLANNINGPROCESS

STRATEGIC MARKET PLANNINGPROCESS 1. Place audit – expanded SWOT analysis

2. Vision & goals

3. Strategy formulation

4. Action plan

5. Implementation & control

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

COMPETITOR ASSESSMENTCOMPETITOR ASSESSMENTSUPERIOR COMPETITOR – protect position, avoid overpopularity

PEER COMPETITIOR – intensified competition, or coopetition

WEAK COMPETITOR – establish new strategy & positioning

Assess competitive position according to:

STRENGTHS – major or minor

NEUTRAL

WEAKNESS – major or minor

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

PERFORMANCE:IMPORTANCE MATRIXPERFORMANCE:IMPORTANCE MATRIXLow High

Importance VV 1 2 3 4 5 6 7 8 9 10 <<Performance

High 10 A. Concentrate B. Keep up the

9 here good work

8

7

6

Low 5 C. Low priority D. Possible overkill

4

3

2

1

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

OPPORTUNITIES & THREATSOPPORTUNITIES & THREATSOverall attractiveness of a destination one of four:

1. Ideal – high in opportunities, low in threats

2. Speculative – high in both opportunities & threats

3 Mature – low in major opportunities & threats

4. Troubled – low in opportunities but high in threats

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

STRATEGIC VISIONSTRATEGIC VISIONOverall growth path

BUT also

* unique combinations of attraction factors to be targeted

* target markets

* short- and long-term goals

* operative prerequisites

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

STRATEGY & IMPLEMENTATIONSTRATEGY & IMPLEMENTATIONFour abilities matrix (Kotler, Hamlin, Rein & Haider, 2002)

Strategic ability

High

Frustrators Expanders

V

V

Losers Gamblers

Low/Low>>>> >>>>High Implementation ability

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

BCG MATRIXBCG MATRIX

Product: market growth

High

Star Problem

V child

V

Cash cow Dog

Low High>>>> >>>>Low Market share

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

ANSOFF MATRIXANSOFF MATRIX

PRODUCT

New

Product Diversification

V development

V

Penetration Market

development

Existing Existing>>>> >>>>New MARKET

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

COMMUNICATING MARKETING STRATEGY

COMMUNICATING MARKETING STRATEGYMARKETING MIX – THE 4 Ps

* Product = customer value

* Promotion = communications

* Place = convenience of access

* Price = cost

MARKETING STRATEGIC

APPROACHES

R. Cleverdon

THE COMPETITIVE CONTEXT

LET’S QUICKLY TAKE STOCK….

•Does your destination have a competitive strategy….?

•Are you clear about the most important challenges facing your destination? What are they?

•Do you know who your competitors are…..more importantly do you know how they are performing and what their plans/actions are?

•Do you know who your key customers are…more importantly what they like, dislike, do, read, how old they are, etc. etc.

•Do you know how your destination will distinguish itself…and whether it is achieving this?

R. Cleverdon

Thank you!