Transcript PPT Chapter 10

Chapter Ten
Understanding Tourism Markets
Importance of Travel and
Tourism
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United Nations World Tourism
Organization (UNWTO) defines tourism
as the activities of people traveling to
and from places outside their usual
environment for not more than one
consecutive year
Affects the economy of every country,
city and community in the world
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Importance of Travel and
Tourism
Tangible and intangible components are all
interrelated and sensitive to environmental
trends including:
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The tourist
The tourist-generating region
Transportation systems
Tourist destinations
Hospitality services
The tourism industry
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Importance of Travel and
Tourism
The multiplier effect
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The impact the tourist dollar has on a
destination’s economy in that wage earners
working in hospitality and tourism also
spend earnings in the local community
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Exhibit 10-1; The Multiplier Effect
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Importance of Travel and
Tourism
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Growth since World War II and 1960
Fastest growing destinations have been Asia,
the Pacific and Middle East
Competition among destinations is fierce
Travelers wants and needs constantly change
Tourism is susceptible to changes in the
macro environment
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Local Residents’ Attitudes
Towards Tourism
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Success and sustainability of tourism depends
on the attitudes of local residents towards
tourism
Hospitality of local residents is important
Will support tourism when the expected
benefits exceed the costs
Residents of depressed economies are likely to
support tourism for its perceived benefits
Ultimately there must be a fit between what
the market wants and the destination offers
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National Tourism Organizations
(NTOs)
Governments promote their countries
with NTOs via:
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Publicity campaigns
Research
Plans for destinations
US is the only major country without a
federally funded NTO
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National Tourism Organizations
(NTOs)
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Traditionally NTOs marketing goals have
been to create and communicate overall
appealing destinations images and
messages to the target market
Today marketing programs are more
collaborative with the private sector
NTOs are focused mainly on marketing
the county as a whole
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National Tourism Organizations
(NTOs)
NTOs also facilitate:
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Collecting analyzing and decimating market
research data
Establishing a representation in the markets of
origin
Participating in trade shows
Organizing and coordinating familiarization trips
Supporting the private sector in the production and
distribution of literature
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How Hotels and Tourist
Destinations Work Together
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A critical issue for the hotel is how to
maintain it’s identity and not get lost in
the promotion of the destination
Interview with Leanne Pletcher of the
Hilton Waikoloa on Hawaii
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Destination Marketing Strategy
Before strategy must come an assessment of
opportunities and threats
Examine the major forces in the macro
environment
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Identify factors that that are likely to influence the
business and future business
Should include a brief review of major forces like
market acceptance, social perceptions, and
consumer trends
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Five Forces Model
Technological
Environment
Ecological
Environment
Sociocultural
Environment
Risk of Entry by
Potential Competitors
Bargaining
Power of
Suppliers
Threat of
Substitute
Products
Rivalry Among
Established Firms
Economic
Environment
Marketing Essentials in Hospitality and Tourism:
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Bargaining Power
Of Buyers
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Regulatory
Environment
Political
Environment
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Forces in the Macro
Environment
Economic
environment
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International
tourism is largely
dependent on the
economic conditions
in areas where the
prospective visitors
live
Marketing Essentials in Hospitality and Tourism:
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Technological
environment
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Technology has helped
foster the rapid growth
of travel and tourism
in the last 20 years
Advent of computer
technology has
assisted the travel
industry
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Forces in the Macro
Environment
Political/Legal Environment
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Government interest largely due to the economic
significance of tourism
Restrictions or changes in international travel
policy can greatly affect tourism
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September 11, 2001
Air transportation increasing international flights in the
1980’s
In 2004 the Chinese government expanded its list of
approved countries its residents are able to visit
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Forces in the Macro
Environment
Ecological environment
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Impact of travel on a
destination’s ecology has
brought the issue to the
forefront for both
travelers and host
communities
Measures such as
limiting tour operators or
increasing visitors’ fees
may help
Marketing Essentials in Hospitality and Tourism:
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Sociocultural environment
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Involves the beliefs, values,
attitudes, opinions, and
lifestyles
Demographic shifts of age
in the population
Shrinking population due to
lower fertility rates
Rising education levels
Increasing economic role of
women
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Forces In the Macro
Environment
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There is rivalry among destinations
Must have sound understanding of the market
to compete
Destinations are mutually dependent in that
competitive moves will be addressed also by
competitors in the same market
Identifying competition is crucial as it
provides a basis for competitive analysis
Context and situation influence a traveler’s
consideration set
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Segmenting the Tourist Market
Destinations cannot be everything to every
traveler
Identify groups
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Travelers who have common interests and share
common values
Travelers that may be interested in the kinds of
attractions, services and facilities that the
destination offers
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Segmenting the Tourist Market
Understand the destinations capabilities
and resources and use them to attract
tourist segments
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Services the destination offers
What customers make purchases and why
Meeting customer needs
Core competencies
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Segmenting the Tourist Market
How to describe markets:
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Demographics
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The travelers’ wants and preferences and the frequency of
their purchases which are associated with demographic
characteristics
Psychographics
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Describes psychographic information, such as lifestyle or
personality attributes, which is usually subjective
Behavior
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Categorize based on knowledge, attitude, use, motivation,
or response to an attraction, facility, or service
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Communicating with the Tourist
Market
Importance of image promotion
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Every communication related to a
destination helps the potential tourist form
and image
Negative images can also have a profound
effect on tourism
Countries spend millions of dollars to create
positive images
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Foundations and Practices by Shoemaker & Shaw
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Communicating with the Tourist
Market
Choosing a destination: College student
traveling to Cancun as an example
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Image, actual travel, recollection
Experiences live up to expectations
satisfaction
Decision to return
Word-of-mouth
Marketing Essentials in Hospitality and Tourism:
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Travelers’ Information
Search Behavior
Part of the decision making process
Understanding can aid marketers to
develop effective communication
Consumers prior knowledge:
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Expertise
Familiarity
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© 2008 Pearson Education, Upper Saddle River, NJ 07458.
All Rights Reserved.
Expertise
As familiarity increases, so does expertise
Product related experiences influence expertise
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Advertising exposure
Interactions with sales people
Purchase
Product usage
Exposure to brand name
Need understanding of consumer’s external information
source utilization
Travelers’ involvement is likely to have a positive effect
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Familiarity
Familiarity has been determined to be an
important factor in consumer decision
making
Gained from ongoing information search
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Guidebooks or books
Advertising and newspaper write-ups
TV and radio advertisements
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Foundations and Practices by Shoemaker & Shaw
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© 2008 Pearson Education, Upper Saddle River, NJ 07458.
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Familiarity
Learning is likely to influence consumers’
decisions
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Intentional
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Learning through active cognitive processing of
information
Likely to increase traveler’s expertise and
familiarity
Incidental
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Learning that occurs unintentionally
Likely to increase only a traveler’s familiarity
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Foundations and Practices by Shoemaker & Shaw
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Familiarity
Importance of perceived cost
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Make external searches inexpensive and
time efficient
Clearly identify the unique selling points
of the destination to differentiate the
destination and make it easier for
potential travelers to understand
Word of mouth communication
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Foundations and Practices by Shoemaker & Shaw
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Discussion
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Give an example to illustrate what is
meant by “destination marketing.”
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