The Marketing Mix The Marketing Mix for Tourism for Tourism

ServicesServicesObjectiveObjective: : Introducing the four basic Introducing the four basic

controllable variables – known as the 4Ps of controllable variables – known as the 4Ps of marketing that marketing managers use in marketing that marketing managers use in

order to manage demand. In addition, order to manage demand. In addition, explaining how these variables expanded to explaining how these variables expanded to

include people, process and physical evidence include people, process and physical evidence or design for travel and tourism services.or design for travel and tourism services.

Marketing mix definedMarketing mix defined

A company’s success depends on the A company’s success depends on the ability of the company in;ability of the company in;

responding the changes in the responding the changes in the environment,environment,

forecasting the direction and intensity forecasting the direction and intensity of these changes, andof these changes, and

using the internal controllable resources using the internal controllable resources (marketing mix) in adapting to the (marketing mix) in adapting to the changes in the external environment.changes in the external environment.

Marketing mix may be defined as the Marketing mix may be defined as the mixture of the controllable mixture of the controllable marketing variables that the firm marketing variables that the firm uses to persuade the customers in uses to persuade the customers in the target market in order to secure the target market in order to secure sales. sales.

Basically, the marketing mix Basically, the marketing mix variables are referred to as the variables are referred to as the 4 Ps: 4 Ps: product, place (distribution), product, place (distribution), promotion, and price.promotion, and price.

The four controllable are the The four controllable are the product product formulationformulation which is adapting the product to which is adapting the product to the changing needs of the target customer;the changing needs of the target customer; pricingpricing which is used to increase or slow down which is used to increase or slow down the volume of sales according to market the volume of sales according to market conditions; conditions; promotionpromotion which is used to which is used to increase the numbers of the people in the increase the numbers of the people in the target market who are aware of the product target market who are aware of the product and directed to buy the product; the and directed to buy the product; the placeplace which determines the number of prospective which determines the number of prospective customers who are able to find convenient customers who are able to find convenient places and ways to convert their buying places and ways to convert their buying intentions into purchases.intentions into purchases.

These four are guided continuously according These four are guided continuously according to the market conditions, especially with regard to the market conditions, especially with regard to the actions of the competitors.to the actions of the competitors.

4 Ps and 4 Cs4 Ps and 4 Cs The four conrollable marketing mix The four conrollable marketing mix

elements all begin with the letter “p” by elements all begin with the letter “p” by McCarthy (1981). They are stated in McCarthy (1981). They are stated in producer oriented terms, therefore Kotler producer oriented terms, therefore Kotler and Amstrong (1999) restated them by and Amstrong (1999) restated them by using the “c” to reflect consumer using the “c” to reflect consumer orientation central to modern marketing orientation central to modern marketing today. today. Customer value for productCustomer value for product Cost for priceCost for price Communication for promotionCommunication for promotion Convenience for placeConvenience for place

ProductProductProduct covers the shape or form of what is Product covers the shape or form of what is offered to prospective customers. Product offered to prospective customers. Product components include:components include:

Basic designBasic design, such as the size and facilities of a , such as the size and facilities of a hotel.hotel.

PresentationPresentation, which is mainly the atmosphere , which is mainly the atmosphere and environment created on the property.and environment created on the property.

The service elementThe service element, which includes the , which includes the number, training, attitudes and appearance of the number, training, attitudes and appearance of the staff who deliver the product to the consumer.staff who deliver the product to the consumer.

BrandingBranding, which identifies particular products , which identifies particular products with a unique name and image. In other words, is with a unique name and image. In other words, is the synthesis of all product elements. So that, it is the synthesis of all product elements. So that, it is the focus of the promotional activity.the focus of the promotional activity.

In modern marketing, products in travel In modern marketing, products in travel and tourism are designed for and and tourism are designed for and continuously adapted to match, target continuously adapted to match, target segments’ needs, expectations, and segments’ needs, expectations, and ability to pay. Most organizations ability to pay. Most organizations produce and market not one but several produce and market not one but several products. For example, tour operators products. For example, tour operators provide a range of products within their provide a range of products within their brochures. And large hotels have brochures. And large hotels have separate products ranging from separate products ranging from meeting and business class rooms to meeting and business class rooms to short break packages for holiday short break packages for holiday market.market.

Activities: Activities: Product planning; product Product planning; product research andresearch and

development; product testing; and the development; product testing; and the service service

accompanying the productaccompanying the product.. Market research on product planning, Market research on product planning,

development, and product testingdevelopment, and product testing Product research on the development Product research on the development

of product styling and fashionsof product styling and fashions Presale servicePresale service Postsale servicePostsale service

PricePrice

Price indicates that the published or negotiated Price indicates that the published or negotiated terms of the exchange transaction for a product terms of the exchange transaction for a product between a producer ( who aim to achieve between a producer ( who aim to achieve predetermined sales volume and revenue predetermined sales volume and revenue objectives) and prospective customers ( who objectives) and prospective customers ( who aim to maximize the value for money in choices aim to maximize the value for money in choices they make between alternative products). they make between alternative products).

In tourism there is generally a regular or In tourism there is generally a regular or standard price for a product. In addition, there standard price for a product. In addition, there are discounted or promotional prices because of are discounted or promotional prices because of the needs of particular segments of buyers, or the needs of particular segments of buyers, or particular market conditions such as particular market conditions such as seasonality.seasonality.

Activities: Activities: Price determination; pricing Price determination; pricing policies;policies;

and specific pricing strategiesand specific pricing strategies.. Determining list price of products Determining list price of products

given demand, cost, and competitive given demand, cost, and competitive constraintsconstraints

Determining channel member Determining channel member discountsdiscounts

Setting overall strategy on pricing Setting overall strategy on pricing above or below competitors’ pricesabove or below competitors’ prices

Dealing with legal constraints on Dealing with legal constraints on pricesprices

Place (or distribution)Place (or distribution) For marketing purposes, place does not just For marketing purposes, place does not just

mean the location of a tourist attraction or mean the location of a tourist attraction or facility, but the location of all points of sale facility, but the location of all points of sale that provide access to tourist products. For that provide access to tourist products. For example, “place” for Disney World in the USA example, “place” for Disney World in the USA is not only Orlando, Florida, but also the is not only Orlando, Florida, but also the numerous travel agents that sell the Disney numerous travel agents that sell the Disney World product. However, travel agents are World product. However, travel agents are only one of the ways in which “place” or only one of the ways in which “place” or access is created for products in travel and access is created for products in travel and tourism. Place would include computerized tourism. Place would include computerized and other reservation/booking systems that and other reservation/booking systems that provide access to products for repeat/loyal or provide access to products for repeat/loyal or prospective customers.prospective customers.

Activites: Activites: The selection, coordination, The selection, coordination, and and

evaluation of channels; transportationevaluation of channels; transportation TransportationTransportation Determination of the basic channels Determination of the basic channels

of distributionof distribution Selection of individual Selection of individual

establishments within the basic establishments within the basic channelschannels

Producer’s efforts to develop and Producer’s efforts to develop and assist the channel of distributionassist the channel of distribution

PromotionPromotion The most visible of the four Ps is the promotion The most visible of the four Ps is the promotion

which includes advertising, direct mailing, sales which includes advertising, direct mailing, sales promotion, brochure production, merchandising, promotion, brochure production, merchandising, public relations (PR). Promotional techniques, public relations (PR). Promotional techniques, which will be examined in detail in the following which will be examined in detail in the following chapters, are used to make prospective chapters, are used to make prospective customers aware of products in order to sharpen customers aware of products in order to sharpen the attractiveness and stimulate demand. In the attractiveness and stimulate demand. In addition, they provide information to help addition, they provide information to help customers decide, and generally provide customers decide, and generally provide incentives to purchase. Note that, promotion incentives to purchase. Note that, promotion can only be effective if it is coordinated with the can only be effective if it is coordinated with the other three.other three.

Activities: Activities: Sales management; personal selling; Sales management; personal selling; advertising;advertising;

sales promotional programs; and all other forms sales promotional programs; and all other forms of of

marketing communications marketing communications Product branding and promotional packagingProduct branding and promotional packaging Printed media advertising (newspapers, Printed media advertising (newspapers,

magazines, and brochures)magazines, and brochures) Broadcast media advertising (radio and Broadcast media advertising (radio and

television)television) Sales management and personal selling, Sales management and personal selling,

including training, and supervision and sales including training, and supervision and sales efforts of company management personnelefforts of company management personnel

Special promotional activities - promotional Special promotional activities - promotional warranties, trade shows, dealer aids, and warranties, trade shows, dealer aids, and product displaysproduct displays

Expanding the marketing Expanding the marketing mixmix

The expanded marketing mix is offered The expanded marketing mix is offered by Booms and Bitner in the 1980s. They by Booms and Bitner in the 1980s. They added;added; People; participants in the service deliveryPeople; participants in the service delivery Process; of service deliveryProcess; of service delivery Physical evidence; of service deliveryPhysical evidence; of service delivery

There is overlap between them. In There is overlap between them. In addition, they may be considered as addition, they may be considered as part-product and part-communications part-product and part-communications mix. mix.

PeoplePeople

Regarding travel and tourism Regarding travel and tourism products, there is substantial human products, there is substantial human interaction as part of the service interaction as part of the service experience. Participants include;experience. Participants include; Visitors; interaction with other customersVisitors; interaction with other customers Employees; front-line and support staff Employees; front-line and support staff

interact with visitorsinteract with visitors Host community; residents of a Host community; residents of a

destination country interact with visitorsdestination country interact with visitors

The service delivery The service delivery processprocess

The travel and tourism experience The travel and tourism experience includes both process and outcome. includes both process and outcome.

Consumers move through a series of Consumers move through a series of sevice delivery encounters during sevice delivery encounters during their experience. their experience.

Some encounters may be more Some encounters may be more important than others;important than others; Critical incidentsCritical incidents Moments of truthMoments of truth

Critical incidentsCritical incidents; specific interactions ; specific interactions between a consumer and service between a consumer and service employees (or equipment) that are employees (or equipment) that are especially satisfying or dissatisfying. especially satisfying or dissatisfying. They are less memoriable.They are less memoriable.

Moments of truthMoments of truth; stays in consumer’s ; stays in consumer’s mind and signify quality and satisfaction. mind and signify quality and satisfaction.

Service recovery systemsService recovery systems are required to are required to turn dissatisfied customers into satisfied turn dissatisfied customers into satisfied customers. For this, companies need to;customers. For this, companies need to; Measure and track the costs of customer Measure and track the costs of customer

retentionretention Encourage complaintsEncourage complaints Train employees in service recovery Train employees in service recovery

To improve the performance of service To improve the performance of service delivery;delivery; Using scriptsUsing scripts; sequence of actions, equipment ; sequence of actions, equipment

and words that help to have a smooth and and words that help to have a smooth and seamless service delivery processseamless service delivery process

Service blueprintingService blueprinting; flowchart of the service ; flowchart of the service delivery process; a picture, graphical delivery process; a picture, graphical representation or map that accurately representation or map that accurately portrays the service system so that the portrays the service system so that the different service people can understand and different service people can understand and deal with it objectively. A blueprint can deal with it objectively. A blueprint can involve all relevant points of contact, standard involve all relevant points of contact, standard length of time for activities, bottlenecks, length of time for activities, bottlenecks, possible service failure points, etc. possible service failure points, etc.

Physical evidence and Physical evidence and designdesign

Refers to the internal and external Refers to the internal and external design of the built environment of the design of the built environment of the travel organization.travel organization.

Due to inseparability, physical setting in Due to inseparability, physical setting in the service delivery process is an the service delivery process is an important part of the visitors’ important part of the visitors’ experience. experience.

In relation with intangibility, it is used to In relation with intangibility, it is used to tangibilize the offer, especially important tangibilize the offer, especially important at the point of sale to influence purchase. at the point of sale to influence purchase.

Useful Links and Useful Links and SourcesSources

Kotler, P.; Bowen, J. and Makens, J. (1999). Kotler, P.; Bowen, J. and Makens, J. (1999). Marketing for Hospitality and Tourism (2nd Marketing for Hospitality and Tourism (2nd ed.). Prentice Hall. NJ.ed.). Prentice Hall. NJ.

Kotler, P. and Armstrong, G. (2006) Kotler, P. and Armstrong, G. (2006) Principles of Marketing (11th ed.). Prentice Principles of Marketing (11th ed.). Prentice Hall. NJ. Hall. NJ.

Middleton, V.T.C. (2004) Marketing in Middleton, V.T.C. (2004) Marketing in Travel and Tourism (3rd ed). Elsevier. Travel and Tourism (3rd ed). Elsevier. Oxford.Oxford.

http://www.hotelsmag.comhttp://www.hotelsmag.com http://www.tourism.bilkent.edu.tr/~edahttp://www.tourism.bilkent.edu.tr/~eda