Marketing, Branding, Advertising, Consumer Insight, Digital, Marketing, Public Relations, Design, Media – Michael Cloke

Customer Orientation: The purpose of a business is to create and maintain profitable customers.

A. Customer satisfaction leading to profit is the central goal of hospitality and tourism marketing.

B. The long-term value of the customer must be assessed in order to take appropriate actions and ensure a customer’s long-term support. Statistical evidence supports the idea that it is much more efficient to maintain customer relationships than to create new customers. Indeed, it is difficult to regain a customer which has been lost to the competition. This is a fundamental idea in marketing today.

Marketing in the Hospitality Industry

Importance of Marketing: Only those companies that understand their customers can survive in the highly competitive environment.

A. The entrance of corporate giants into the hospitality industry and the marketing skills these companies bring with them have produced a much higher level of competition.

B. There are some who predict that the hotel industry will consolidate in much the same way as the airline industry has with five or six major chains dominating the market. If true, this will produce a highly competitive industry with only those companies that understand their customers, surviving.

With this increase in competitive pressure, the marketing director is becoming of great importance. It is the marketing director who will focus the company and its employees on the customers and appropriate priorities.

Travel Industry (Tourism) Marketing: Hospitality and travel marketing is very interdependent, cooperative, and complex in nature.

A. The success of the hospitality marketing industry is highly dependent on the entire travel industry. It is very interdependent, cooperative, and complex in nature.

Examples include:

1. Wholesale packages including travel, accommodations, ground transportation, and entertainment.

2. Airline and car rental cooperative arrangements.

3. Cruise packages with airline deals and car rental discounts.

B. Government or quasi-government agencies play an important role in travel industry marketing through legislation aimed at enhancing the industry and through promotion of regions, states, and nations.

C. The Marketing Mix is the set of tools that work together to produce satisfied customers, providing that the appropriate target markets and their needs are identified.

III. Marketing: A social and managerial process by which individual and groups obtain what they need and want through creating and exchanging products and value with others.

Needs:

Human needs are complex; we classify them into categories: basic physical needs such as food and housing; social needs for belonging, affection, fun, and relaxation; esteem needs for prestige, recognition, and fame; and individual needs for knowledge and self-expression. When a need is not satisfied, a void exists.

Wants:

Human wants are how people communicate their needs and are shaped by culture and personality. A hungry Aboriginal wants witchery grubs, lizard eggs, and bush onions. A hungry person in theUnited Statesmay want a hamburger, French fries, and a Diet Coke. Wants are described in terms of objects (or actions) that satisfy needs. See: Macaroni Grill – having jug wine on the tables.

Demands:

Demands are wants backed by buying power. People have almost unlimited wants, but limited resources. They choose product that produces the most benefit for their money. In times of recession or higher gas prices, people still travel but may shorten their stay or substitute destinations that are closer and therefore, more cost effective.

Products:

A product is anything that can be offered to a market for attention, acquisition, use, or consumption and that might satisfy a need or want. As in the case of Colorado Preservation, Inc. historical sites can be restored in such a way that an area can become a destination attraction.

Value:

Value is the consumer’s perception of the product’s overall capacity to satisfy his or her needs. Value is different things to different people. For example, value can be “the best price”, or “what I get for what I give”, or “how fast and conveniently the product is delivered”, or “what I want, regardless of cost”.

Satisfaction:

Satisfaction is determined by how well the product meets the customer’s expectations for that product. Satisfaction is often a measure of the consumer’s perception of that product. A customer centered company must generate customer satisfaction while meeting company objectives – both profitability and image.

Quality:

Quality is the totality of features and characteristics of a product that bear on its ability to meet customer needs. Many companies seek to maximize ROQ (Return On Quality). When they offer the quality the customer wants, they often enjoy improved sales and profitability.

Exchanges:

Exchange is the act of obtaining a desired object from someone by offering something in return; it has legal overtones. An exchange requires two willing parties, with free capacity to accept or reject the other’s offer.

Transactions:

Transactions are marketing’s unit of measurement consisting of a trade of values between two parties. Not all transactions involve money. For example, restaurants may trade meals for advertising.

Relationship Marketing:

Relationship marketing focuses on building a relationship with a company’s profitable customers. Usually, repeat customers provide a company with more profitable business with less expenses than new customers who require a courtship of sorts to purchase. Relationships include customers, distributors and suppliers.

Marketing Management: Demand management.

Marketing management is the analysis, planning, implementation, and control of programs designed to create, build, and maintain beneficial exchanges with target buyers for the purpose of achieving organizational objectives. The effective marketing manager is interested in shaping the level, timing and composition of demand for his/her company’s products.

Five Marketing Management Philosophies

Manufacturing Concept—This concept holds that customers will favor products simply because they are affordable, encouraging management to focus on creating efficiencies in production and distribution. As mentioned in the text, this approach often leads to neglect of the customers.

Examples: SwissAlps.

Product Concept—The product concept holds that customers prefer existing products and product forms, and the job of management is to develop good versions of these products. The fault here is that without environmental scanning and trend analysis, the company will miss crucial changes in the market’s perceptions and expectations. Indeed, the customer will always know what s/he needs, but not necessarily how the product or service can fulfill the need. This is the business of the marketer.

Example: Victoria Station.

Selling Concept—This concept holds that the consumer will respond only to the efforts of the company to market and sell the products. Here, the focus of the company is to sell, sell, and sell. Again, the missing element in this approach is the customer and his or her satisfaction with the product or service. Rather than find the true cause for a slowing of business, firms often advertise to reverse a sales decline or fill gaps created by overcapacity.

Example: Restaurant Wine.

Marketing Concept— This concept holds that achieving organizational goals depends on determining the needs and wants of target markets and delivering the desired satisfaction more effectively and efficiently than competitors. The concept of relationship marketing is clearly prevalent in this approach. The company makes its profits by creating and maintaining customer satisfaction.

Examples: Four Seasons, Accor, McDonald’s and Southwest Airlines.

Societal Marketing Concept—The underlying concept of the societal marketing approach is responsibility. There is growing faction of corporate America that is recognizing the necessity to operate in an environmentally and ethically responsible manner.

Examples: Fast-food restaurants provide food with more nutritional value, resort developers consider the disposal of waste products and use of water. Hotels consider energy conservation, landscaping, preventive maintenance, water-saving plumbing fixtures, and responsible alcohol service training for employees.

Source: Marketing for Hospitality and Tourism

2010 ~ Kotler/Bowen/Makens

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