SWOT Analysis

Before specific marketing activities can be defined, marketers must

understand the current and potential environment in which the

product or service will be marketed. A situation analysis is

sometimes referred to as SWOT analysis. This analysis is an audit

that determines the firm’s internal strengths (S), weaknesses (W)

and examining external opportunities (O) and threats (T).

1. Strengths (S)

 

What is the organisation or business good at? What are its key

advantages over the competition in terms of its products and

services as well as its facilities, customer service and expertise of

employees? These are an operation’s unique ability to gain a

competitive edge over competitors. These should be difficult to

duplicate attributes.

The strengths of the firm should be viewed from the perspective of

the customer or potential customer. Examples of strengths that will

be of concern to the customer include:

Environmental Scan

Internal Analysis External Analysis

Strengths Weaknesses Opportunities Threats

SWOT Matrix

• Company reputation

•

Location, accessibility

•

Standard of service

•

Quality of the company’s products

•

Patents

•

Strong brand names

•

Friendly and well-presented team members

2. Weaknesses (W)

What is the organisation not good at? Where does the business fall

down in terms of the ways it does things? Are the products and

services good enough? Are the buildings, the facilities or the

attractions of poor quality? Is the staff not very good at handling

customers? These are serious flaws that require immediate

corrective action, especially when they prevent an operation from

pursuing an opportunity or avoiding a threat.

Weaknesses, as viewed by the customer, usually occur in the same

aspects of the organisation as those identified above as examples of

strengths.

3. Opportunities (O)

What is happening outside the organisation that offers

opportunities? Has the mass transit transport (MRT) track (e.g.

where the hotel is located) been in operation? Has the country’s

government been spending more money on promoting the area?

These questions were raised with the view to determining the

market’s size and growth trends within the market. For example, the

total market size in number of room available, number of rooms

sold, and room sales in dollar value for the last year. In addition, an

assessment of the economic outlook should be included.

Opportunities are those presented to the organisation. If acted

upon quickly, they are likely to provide further opportunities to

increase sales and improve the image of the organisation.

Marketing and promotional strategies should take advantage of

opportunities as they arise.

4. Threats (T)

 

What is happening outside the organisation that could threaten it?

Are there more competitors? Are there problems with the area?

Perhaps a nearby area has received investment, which might mean

that the local area is now less attractive for the business. For e.g. in

assessing competition, the first thing to do is to identify direct and

indirect competitors.

Threats to an organisation can arise in many shapes and forms and

are often unable to be pre-determined. However, if acted upon

early, threats may be easily overcome or even turned into

opportunities. Examples of threats may include such things as:

•

New competition in the market place

•

A change in management or ownership

•

A change in or closure of neighbouring organisation• A changing economic or industrial climate

Marketing Plan

Marketing plan is designed to implement the strategies chosen at

the corporate and strategic business unit levels. The development

of a marketing plan every year is also important for independent

operations, because having good strategies in place is equally

crucial to their success.

Writing a marketing plan allows you to examine the marketing

environment in conjunction with the inner workings of the business.

Once the marketing plan is written, it serves as a reference point for

the success of future activities. Finally, the marketing plan allows

the marketing manager to enter the market place with an

awareness of possibilities and problems.

Given the competitive situation in the hospitality industry, the

better question is ‘Why would any organisation not plan?’ It is

noted that the long term effect of a marketing plan is to hard

measure with precision. A look at the power of many trademarks in

hospitality offers unquestionable proof that there are such things as

long-term effects. Ronald McDonald is said to be the second most

recognizable name, next to Santa Claus by children. Without

effective marketing strategies, travellers envision universal images

when they hear names like Hilton and Holiday Inn would not have

happened.

Elements of Marketing Plan

Elements of marketing plan should ideally include:

1. Current Situation

What are you doing? This should include a brief review of the

‘product’ you offer, analysis of your target markets and any

important trends.

Marketing DHM 162 / DHCM 162 / DTM 182

13

2. Marketing Objectives

This will involve setting some basic targets and defining what you

want to achieve.

3. SWOT Analysis

A consideration of the factors which are likely to make you succeed

or fail, looking both inside and outside organisation.

4. Competitor Analysis

You will need to decide who your competitors are, what they are

doing and how you can compete with them.

5. Market Research

How much do you really know about your existing and potential

customers? Before you can move forward you will need to establish

basic information about them.

6. Target Markets

You need to consider which markets are most worthwhile and

important to you.

7. Marketing Tools

For many, the most interesting bit! You need to develop a sort of

shopping list of the promotional tools you will use and what budget

you will devote to them.

8. Monitoring

How will you know if you have been successful? You will need to

decide how you are going to monitor your performance.

Marketing Orientation

The marketing orientation is a simple and intuitively appealing

philosophy that articulates a market perspective. The idea includes

the following:

•

organisation can distinguish its product(s) from competitors’

offering.

Focusing on customer wants and needs so that the

•

production, to satisfy these wants.

Integrating all the organisation’s activities, including

•

customer wants and needs legally and responsibly.

To adopt a marketing orientation, the reasoning process about

what we offer begins with consumers’ needs and wants. We must

discover the customers’ needs, wants, and preferences and provide

products and services that meet their needs and wants and match

their preferences. It is what customers think and feel not what

operators know or can sell, that defines the business.

 Societal Marketing Orientation

The Societal Marketing Orientation is the newest marketing concept.

The societal marketing concept holds that the organisation should

determine the needs, wants and interests of target markets and

deliver the desired satisfaction more effectively and efficiently that

competitors in a way that maintains or improves the consumer’s

and society’s well-being

marketing concept is adequate in an age of environmental

problems, resources shortage, rapid population growth, worldwide

inflation and neglected social services. The pure marketing concept

ignores possible conflicts between short-run consumer wants and

long-run societal needs.

For example, Hotel chains have established no-smoking floors and

no-smoking sections in their restaurants. Fast-food restaurants that

practice the societal marketing concept will pursue more

environmentally sound packaging and produce foods with more

nutritional value. Resort developers must consider the impact on

the environment not only of their initial construction but also of the

disposal of waste products and their use of water.. The new concept questions whether theAchieving long-term goals for the organisation by satisfying

Approaches to Marketing

1. Product Orientation

A production orientation is a philosophy that focuses on the

internal capabilities of the hotel rather than on the desires and

needs of the marketplace. A production orientation means that in a

hospitality environment, management assesses its resources and

asks these following questions:

•

What services are most convenient for a hotel to offer?

•

Where do our talents lie?

There is nothing wrong with assessing a hotel’s capabilities; in fact,

such assessments are major considerations in strategic marketing

planning. A production orientation falls short because it does not

consider whether the goods and services that the firm produces

most efficiently also meet the needs of the market place.

Here, the roadside motels provide convenience and lower rates and

steal customers away from the traditional ‘established’ hotels. The

hotel operators thought that the products that they designed were

the most important success factors. For them, the product defined

by tradition was sacred. In today’s market place, operations of this

type are disappearing and being replaced by those that are in tune

with changing consumer demands. The fact is that consumer needs,

tastes and preferences are rapidly changing, and it is the consumers

who define what will and will not succeed.

2. Sales Orientation

A sales orientation is based on the ideas that people will buy more

goods and services if aggressive sales techniques are used and that

higher sales result in higher profits. Not only are sales to the final

buyer emphasised but intermediaries are also encouraged to push

manufacturers’ products more aggressively. To sales-oriented firms,

marketing means selling things and collecting money.

It is quite common in hospitality organisations to find people who

think of selling as the entire extent of marketing. The assumption is

that if you sell hard enough, the guests will buy. Therefore, the

focus of a sales orientation is still the product, or what an operation

has to offer. Operators who think marketing is just advertising and

selling fall into this category; so do operators who look only at the

promotional side of their business.

Selling is a very important business activity; however, the real

danger of the sales orientation is that any success due to selling

may create an illusion that ‘sell, sell, sell’ is the way to prosper. When

an operation offers products and services that fit the needs and

preferences of its guests, selling can contribute greatly to the

success of that operation. However, when guests’ tastes change or

the operation fails to satisfy the guests for any reason, the sales

orientation is doomed to failure. Remember, satisfying the guest is

the key to repeat sales and a vital part of marketing.

THE PRINCIPLES AND CONCEPTS OF MARKETING

Introduction to Marketing

Differences between Selling and Marketing

The selling concept and marketing concept are frequently confused.

Selling concentrates on the seller’s need to convert the product to

cash, while marketing concentrates on satisfying the customer’s

needs and wants. The marketing concept replaces and reverses the

logic that was followed in the selling concept. In short, they can be

defined in the following ways:

Differences between sales and marketing orientations:

1. Sales Orientation

•

Inward, upon the organisation’s needs

•

Selling goods and services

•

Everybody

•

Profit through maximum sales volume

•

 

2. Marketing Orientation

•

Outward, upon the wants and preferences of customers

•

value

Satisfying customer wants and needs delivering superior

•

Specific groups of people

•

Profit through customer satisfaction

•

activities.

Through coordinated marketing and inter-functional

Define Marketing

Marketing is a way of thinking, a philosophy. The American

Marketing Association defines marketing as:

The process of planning and executing the conception, pricing,

promotion, and distribution of ideas, goods and services to create

exchanges that satisfy individual and organisational goals. (Bennett

1995).

The marketing process begins with customers. Specifically, the

process starts with a particular group of customers, often called the

target market. It is the needs of this market that define the products

and services that can be successfully developed and brought to the

market. In hospitality firms, although there are marketing

departments, everyone in the firm is involved in marketing because

good performance by everyone is needed to secure repeat sales.

Facts of Marketing

Marketing has two facets. First, it is a philosophy, an attitude, a

perspective, or a management orientation that stresses customer

satisfaction. Second, marketing is a set of activities used to

implement this philosophy. This is the marketing process.

In hospitality marketing, the product is the experience of the guests.

This experience has both a goods component (e.g. food) and an

interactive component, which we call service. In practice, hospitality

employees become part of the product (experience). In one way or

another, every employee is part of the guests’ experience, because

the typical hospitality organisation is highly personal and interactive.

Primarily through intensive promotion.

Environmental Impacts of Tourism

Environment Impacts of Tourism

‘The environment natural and artifiaial, is the most importants factors of the tourism product.’

Increased interest in the environment since United Nation’s (UN) Conference on the Environment and development (1992) known as Rioo-Earth Summit.

Positive Environment Impacts

1)            Conservation And Preservation

                - Tourism help to conserve natural environment by the designation or ‘zoning of natural areas.

                - National  Parks has been established with very strict regulations on develpment and rules for visitors.

                - Preservation of build or man made constructions. Eg: castles or pieces of worship (zoned of restricted access)

                Money raised from visitors can help in restoring and maintaining these important man made sites.

2)            Enhancement of Environment

-              Tourism can help the environment aesthetically (visually) by making a piece look better.

-              cleaning of areas through money generated from tourism.

-              planting trees to balance tourism development

-              projects designed to make a more pleasant environment such as public art or public enquires.

-              eg: olumpic games of  2012. London will lead to the creation of huge public park for residents and visitors to enjoy.

3)            Environmental Awareness

-              awareness of the environmental problem (Rio Earth Summit 1992)

-              more tourism and hospitality, organizations (public and private) adapting and informing consumers of environmental issues.

4)            Financial contrubution

-              Revenue from park entrance fees and similar sources can be allocated specially to pay for the protection  and management of environmentally sensitive areas.

-              park rangers salaries and park maintainance.

-              contribution to government revenues user fees, income taxes on sales or rental of recreation equipment, liscence fees for activities such as hunting and fishing can provide the funds needed to manage natural resources.

5)            Protection

-              Conservation and restoration of diversity and sustainable use of natural resources.

-              government environment management and planning which can help prevent deteroitation of the environment.

-              cleaner production techniques such as green building (energy efficient and non-polluting construction materials, sewage system and energy services.

-              waste minimization techniques, pollutuion prevention.

Socio-cultural Impacts of Tourism

Positive socio- cultural impacts of Tourism

1)                  Increased support for traditional cultures and displays of ethnic identity

-Cultural activities being revived

-Renewed pride in ethinicity

2)            Revitalising of traditional arts, festivals and language

                - more regular performance or productivity promotes the maintaince of the original product.

3)            Breakdown of negative stereotypes

                - A national stereotypes idea diffused with close contact.

                - fear or disrespect changed with contact.

4)            Increased social opportunities

                - Local get mix with tourists

                - Generation gap will decreased.

5)            Non economic and social opportunities which decrease social inequality

                - Tourist add value to the  previously valueless item and conserve them for the future.

                - Tourist require services previously not required.

                - Affluence propagates more social behaviour.

6)            Increased recreational opportunities

                - Facilities built for the tourists trade provide facilities for the locals suh as water parks, parks, zoos, and gardens, convention center, food & bevarage outlet & sporting facilities.

7)            Support for medical, educational & other facilities which enhance quality of life

                - Better clinics, hospitals, medical staff

                - Educational forums, educational facilities

                - service industry development

                - provision of travel related services such as Garages, tour operators, tourist offices.

Negative Impacts Of  socio- cultural impacts of Tourisms

1)            Commoditation

                - It means the conversion of a destination cultural into a salable commodity in response to perceived or actual demands of tourists market.

                - The market value of a culture is set by and used to attract tourists through the presentation of souvenier and performances.

2)            Social Disruption

                - Changes to social relation occur when some members of families began to earn income and as a result, gain greater independence from the rest of  the family.

                - invasion of privacy is also a significant problem

                - Tourist or Leisure visitors, through ignorance or over enthusiasm may simply disrupt or get in the way of social practice.

3)            Servility effects

                - servility servant- served relationship

                - occurs most often between developed country/western tourists and underdeveloped host countries.

                - particularly evident between while tourists and black tourists.

                - associated with the dominance of western European nations over past centuries.

4)            Prostitution and Crimes

                Factors that make tourists potential crime targets

                -Highly conspicious due to race, clothing, speech, objects carried(eg: cameras, backpacks)

                - more likely to in advertently stray into unsafe areas or become lost on unfamiliar roads.

                - carrying and displaying objects of value.(eg: money, cameras, jewelleris).

5)            Demonstration effects

                - Demonstration effect occur where local people take on the habits of foreigners which are not accepted in their own society.

                - often younger members, emulate consumption habits and life of the tourists.



Waterborne Passenger Transport

Ocean Liners and Cruising

    Appeals to tourists as an attraction in and of its self

  1. The ‘Queen Elizabeth 2’, flag ship of the Cunard Line Ltd

  2.‘Voyager of the Sea’, one of the largest ships afloat, belonging to the Royal Caribbean International Line

  3.Investors are planning to build ‘America World City’ which will carry 6,200 passengers .

Short Cruise

1. One day cruises, and otherwise is usually from 3 days to 14 days in length.

    directed at a person with limited time and funds or first time cruise passengers.

Intermediate Cruise

1) 15 days to 24 days.

 2)  Directed at persons who have previously taken at least one cruise.

 3)  May be oriented to all different budgets.

  

           Long Cruise

—1) 25 days and up

2)  Directed at experienced cruise passengers

3)  Usually quite well-to-do and with substantial time available .

     Major cruising routes in the world

1) The Caribbean, Bermuda and the Bahamas, including the coast of Central and South America.

—2) The west coast of North America, including Mexico, the USA (including Alaska) and Canada

3) —The Mediterranean, divided between the western and eastern sectors.

4) —The Pacific islands and Far East.

 5)—The Baltic Sea, northern European Capitals and the North Cape.

—6) West Africa and the Atlantic islands of the Canaries and Madeira.

 

Transportation

THE TRANSPORTATION AND ACCOMMODATION

Aviation Industry

Travelling by air is seen as the most convenient, fastest way to travel, and now with budget carriers also an affordable one too. Ever since World War Two, the aviation industry has expanded rapidly. Newer and better aircrafts are constantly being put into service, each being bigger

and better and more able to carry more people and cargo and to

travel further before refuelling. European aircraft maker Airbus’s

latest A380 is now able to carry more than 550 passengers on board

and fly a non-stop range of 15,000 kilometres, which is sufficient to

fly from Chicago to Sydney

Travel by air has become safe, comfortable, rapid and above all cheap for several reasons:

-One reason is the enormous growth of aviation technology,

especially since the development of the jet airliner after World War

Two. The first commercial jet (the De Havilland comet, operated by

BOAC) came into service on the London-Johannesburg route in

-Increases in carrying capacity for passengers and freight have

steadily reduced average seat costs, with jumbo jets

accommodating up to 500 passengers

-Airlines, however, are motivated to introduce such large aircraft not

only for reasons of efficiency but also as a means of overcoming the

problem of growing congestion at airports throughout the world,

particularly the leading hub airports where there are acute

shortages of take-off and landing slots.

- Another factor in the development of mass travel by air was the

enterprise and creativity demonstrated by both air transport

management and other entrepreneurs in the tourism industry. The

introduction of the net inclusive tour basing fares for tour operators,

variable pricing techniques such as Advance Purchase Excursion

(APEX) tickets and stand-by fares, and more recently frequent flyer

programmes, in which passengers collect additional free miles

based on the mileage they accumulate with a carrier, have all

helped to stimulate demand and fill aircraft seats. A major

development in recent years has been the growth of low-cost,

airlines like easyJet and Ryanair.

-An equally important development for the scheduled carriers in the

past three decades has been the chartering of aircraft to tour

operators

Organisation of Air Transport

The civil aviation business is composed of a number of elements,

namely:

1. Equipment Manufacturers,

2. Airports,

3. Air Navigation and Traffic Control Services and

4. Airlines

Broadly speaking, air transport operations are regulated in three

ways.

1. Internationally, scheduled routes are assigned on the basis of

agreements between governments of countries concerned.

2. Internationally, scheduled air fares are now subject to less and

less control, as in both North America and Europe airlines are

free to set their own fares. However, governments can still

intercede where predatory pricing is involved, and in practise,

within Europe, fares are permitted to fluctuate between

acceptable maxima and minima.

3. National governments approve and license the carriers which

are to operate on scheduled routes, whether domestically or

internationally. In the UK, the Civil Aviation Authority (CAA) has

this responsibility and is also responsible for the licensing of

charter airlines and of tour operations organizing package

holidays abroad.

Further legislation concerning passenger aviation resulted from the

Chicago Convention on Civil Aviation held in 1944, at which eighty

governments were represented in discussions designed to promote

world air services and to reach agreement on standard operating

procedures for air services between countries. There were two

outcomes of this meeting: the founding of the International Civil

Aviation Organisation (ICAO), now a specialised agency of the

United Nations, and the establishment of the so-called five

freedoms of the air. These comprise the privileges of

1. The First Freedom of the Air - The Right of Fly over (Transit). An

airline may fly over another country without landing.

2. The Second Freedom of the Air – The Right of Technical

Landing (Transit). An airline may make a technical landing in

another country for purposes other than the carriage of

passengers or freight, e.g. in order to refuel

3. The Third Freedom of the Air – The Right of Outbound Carriage

(Traffic). An airline may transport a commercial load

(passengers, cargo, or mail) from its home country to another

country.

4. The Fourth Freedom of the Air – The Right of Inbound Carriage

(Traffic) An airline may transport a commercial load from

another country to its home country.

5. The Fifth Freedom of the Air – The Right of Carriage between

Countries. An airline may transport a commercial load from one

country to another country, where neither country is its home

country, provided that the flight begins or ends in its home

country.

Other freedoms not discussed by the Convention, but equally

pertinent to the question of rights of operation, have been termed

the sixth, seventh and eighth freedoms.

6. The Sixth Freedom of the Air - The Right of Carriage via Home

Country. An airline may transport a commercial load between 2

countries, provided that transport is via the home country.

7. The Seventh Freedom of the Air – The Right to Operate Outside

Home Country. An airline may operate outside its home

country while carrying traffic between 2 countries, neither of

which is its own country.

8. The Eighth Freedom of the Air – The Right of Foreign Domestic

Carriage. An airline may transport a commercial load between

2 domestic points in the same foreign state or country. This

right is seldom granted.What is the difference between scheduled and chartered air

services?