There are two main components to the marketing work. Making ensuring the consumer who is most likely to be interested in the product is aware of both its existence and its principles, as well as how to purchase it through effective supply channels, comes first. The two tasks must be coordinated in practise because they are naturally related.
The large range of products and the interdependence of the components, which are two of tourism’s unique qualities, need to be considered (e.g. transport and accommodation). Depending on the market sector and each of the major travel trades involved, different promotion and distribution strategies will be used.
For a large part of the total market the traveller will go to the product and not as customary in trade the product brought to the consumer, displayed for example in the retailer’s shop for inspection and even trial. Most tourists, especially in the case of international travel, will buy ‘at a distance’ ‘sight unseen’, e.g. package holiday abroad at a strange destination.
There will be numerous and diverse promotion media as well as distribution outlets. The easiest technique to study linked systems and the distribution process in particular is to look at how different traveller segments or types purchase their services, and more specifically the location or locations where the sale is made. These consist of:
- The travel industry: wholesalers (who are also primary tour operators) and retail (travel agents). It is not generally understood that the travel agent represents his principal, the provider of important services like transportation and lodging, etc. The tour operator, however, not only acts as a distributor but also as a principle and a manufacturer of a whole tourist product.
- Travel stores, typically the location of a retail travel agency. In a process known as vertical integration, large tour operators increasingly own or manage retail stores, charter planes, and computerised reservation systems. Along with booking via mail, some of their customers will do it immediately over the phone or using modern technologies.
- The main characters, transportation companies, particularly airlines, lodging establishments, theatres (box offices), and other entertainment, as well as event planners. Many customers will make purchases online, paying with a credit card, using the computerised reservation systems that are covered in more detail, and occasionally making phone calls to the principals’ offices or travel agents.Numerous guiding principles openly support direct selling in order to eliminate the middleman’s costs by providing advantages. Airlines place a high value on their loyalty programmes, such as the British Airways Executive Club, which provides access to airport lounges and other amenities. Airlines hold a unique position in the reservation systems they manage, which include other travel-related services like lodging. Fears of monopoly positions are sparked by this, along with the globalisation of big business and multinational operations.
- Other (auxiliary) travel organizers. A large force of non-commercial or specialist operators have always been a force in tourism and appear to be increasing as the travel trade proper concentrates on selling a limited range of ‘mass products’. These outlets are found in clubs, institutions, societies and organizers in the educational, social (youth) cultural and religious fields. The American Society for Retired People, for example, is a powerful force. Many act as principals, organizing complete packages for day, weekend and longer outings at home and abroad.
Computer reservation systems
A computer reservation system (CRS) is a computer distribution system for displaying available services and facilities, making bookings and ticketing by tourism producers (e.g. airlines and other transport modes, hotels, car hire, inclusive tours, cruises etc.). The principal systems have a major advantage by securing payment for the producer and providing management information and capability of last minute changes. In addition to benefits of rapid service and making it ‘easy to buy’, the resulting increased productivity in the sales chain leads to lower distribution costs.
The main systems were developed rapidly in the 1980s by the major airlines. They, and other large companies such as hotel chains, have their own in-house or house systems which stock availabilities of capacity of inventory. There are other distribution services reviewed in this thread which might be more suitable for smaller businesses. Different systems may interface. Multi-access links specific market segments or regions. Mass distribution through retail stores or electronic media (Minitel) are examples of a wide field which is developing rapidly as tourism expands.
To avoid unfair or monopoly trading it is essential that the systems are neutral and objective in information provision. Governments have introduced mandatory codes of practice to ensure this.
A tourist product, i.e. the provision of services and facilities for a complete visit whether for business or leisure, is a relatively expensive ‘mass’ purchase. The manufacturers of such goods, however, will provide after-sales service to ensure satisfactory use or enjoyment. This is often lacking in tourism, partly because of the range of services and suppliers involved. The after-sales service is just as important in tourism to safeguard future business and recommendation, and by increasing satisfaction to generate repeat custom and greater length of stay. This is one of the necessary cooperative tasks in tourism, and an essential responsibility of the destination interests, the local or state tourism office. They need to research visitor behavior and recreation. Action can then be taken to improve services and deal with deficiencies.
Tourist information offices can play a key role in this task and supplement or extend their services by recorded telephone messages, radio and television programmes, and the distribution of literature in hotels and other tourism centres. ’What’s on’ reports are very important in increasing satisfaction with the visit and stimulating sales, and delivering the product to the customer.
The cost of the different techniques or media varies greatly. Advertising, especially on television, requires a large budget but is most used for the mass products (airlines, tour operators). It is, however, possible to mount very effective campaigns by smaller destinations and businesses, at modest cost using literature, public relations methods and distribution and sales networks.
The budget allocation will determine in part the selection of media. Some may be inexpensive such as public relations activities: persuading journalists and travel writers to feature the establishment or service, but in such cases there is a ‘price to pay’. The seller has no control over timing, the audience reaction or the message itself. While this can provide a useful background medium for tourist boards, or when opening up new markets, the effects are likely to be uncertain. Good news about good tourism services travels fast. The product is popular and can be of great interest. However, the reverse is true. Bad news can circulate rapidly and failures can be costly to rectify or mitigate damage in crisis reporting. The search for new markets can be expensive, but some investment is necessary as tourism movement becomes more volatile. Most businesses have a mix of clientele, where some forms of trade complement others. A hotel, for example, may have a local clientele, important for catering, a business clientele, and a tourism trade providing weekend and holiday season visitors when business travel declines.
Budgeting marketing campaigns is never easy. Clearly the total investment
must be related to the business and revenue to be generated. A simple
rule is to estimate the cost of reaching potential clients identified and the expected response in sales. This is more practical if regular appraisals of past promotions have been carried out, so that there is some guidance from practical experience of likely response to media selected, such as replies from advertising in the local guides or in tourist board publications. This gives an estimated promotion cost per sale, important in planning promotion for new business
There will be a variety of approaches, according to destination, location, trade and business objectives. Assessment of results is essential, with continuing effort to measure performance against objectives, using market research as a basis for future market planning and related product development. The trade must remain market oriented.