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Product and Partnership. C10. “a large part of marketing plan concerns how the organisation intend to use the “P’s” of marketing (marketing mix): -Morrison just because a product is better is no guarantee it will succeed. Products must provide benefits that people seek. Partnership. promotion.
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“a large part of marketing plan concerns how the organisation intend to use the “P’s” of marketing (marketing mix): -Morrison • just because a product is better is no guarantee it will succeed. Products must provide benefits that people seek.
Partnership promotion Needs and wants Programming Product's utility price businesses Packaging place People
What is a Product? • A product is anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need • Includes physical objects, services, places, organizations, and ideas • product can be "ideas, goods, or services." • Since tourism is primarily a service based industry, the principal products provided by recreation/tourism businesses are recreational experiences and hospitality. The intangible nature of services makes quality control difficult but crucial. It also makes it more difficult for potential customers to evaluate and compare service offerings. instead of moving the product to the customer, the customer must travel to the product (area/community).
tourism has many components comprising the overall "travel experience." it includes such things as transportation, accommodations, food and beverage services, shops, entertainment, aesthetics and special events
Product suppliers - Tourism sectors • Accommodation/lodging sector – hotels, bed and breakfast, self catering, camp sites,… • Attraction sectors - museums, theme parks, festivals, … • Transport sectors – railways, cruise, airlines, car rental,… • Travel organisations sectors – tour operators, travel agents, booking agencies,… • Destination organisation sectors – national tourism offices, destination marketing organisations,…
principal products that recreation and tourism businesses provide are • recreational experiences and hospitality services • The factors that create a quality experience often differ among people/market segment. • Nature : with infrastructure vs. without infrastructure • Decisions on what facilities, programs and services to provide should be based on the needs and desires of the target market(s). • They should not be based on the preferences of the owner/manager or necessarily on what the competition is providing.
What is a Product? • Products, Services, and Experiences: • Market offerings may consist of a combination of goods and services • customers are really buying much more than just products and services. They are buying what those offers will do for them. Goods- services continuum Pure goods Pure services
Intangibility • Service intangibility means that customers can’t see, touch, or smell a service. • A service cannot be inspected or handled before the purchase is made. • Services are more difficult to evaluate than products. • Consumers look for reassuring signs before purchasing. The “look” is very important (such as the service provider’s facility). • Physical cues could be uniforms, brand logos, and carefully designed Web sites. Perishability • Service perishability means that a firm can’t store its services—it’s a case of use it or lose it. • Marketers try to avoid “perishability” problems by using the marketing mix to encourage demand for the service during times when it would otherwise be low. • Prices can be reduced to match demand.
Variability • Service variability refers to the inevitable differences in a service provider’s performance from one day to the next. • It is difficult to standardize services because service providers and service customers vary. • One solution to the problem of variability is to institute total quality management programs for continuous improvement of service quality. Inseparability • A service can only take place at the time the service provider performs an act on either the customer or the customer’s possession. • Services cannot be detached from those that provide them. • Employees are important in services. • To reduce the problems that might occur in the service encounter, service providers are experimenting with disintermediation—eliminates the need for customers to interact with people (i.e., self-service banks). • The Internet has provided opportunities for disintermediation (especially in financial services).
LAYERS OF THE PRODUCT CONCEPT When marketers develop product strategies, they make decisions about product benefits, features, styling, branding, quality, … • A product is everything that a customer receives in an exchange. • A product is made up of: • the core product, the • actual product, • the augmented product. • Marketers need to consider how to satisfy customers’ wants and needs at each of these three levels.
LAYERS OF THE PRODUCT CONCEPT • The Core Product - consists of all the benefits the product will provide for consumers or business customers. • A benefit is an outcome that the customer receives from owning or using a product. • Marketing is about supplying benefits, not products. • The Actual Product - the physical good or the delivered service that supplies the desired benefit, • includes the unique features of the product, such as its appearance or styling, the package, and the brand name. • The Augmented Product - the actual product plus other supporting features such as warranty, credit, delivery and after sales services • Adding these supporting features to a product is an effective way for a company to stand out from the crowd.
What the buyer is really buying • Every product is a package of problem-solving services • Extra products offered to add value to the core product and help to differentiate it from the competition • Goods or services that must be present for the guest to use the core product Value creation – manipulating the product mix elements
Augmented Product • The augmented product includes accessibility, atmosphere, customer interaction with the service organization, customer participation, and customers’ interaction with each other.
Product mix • Each “product” of the tourism/hospitality industry are many and varied thus each organisation within the industry has its own product/service mix. • Product-service mix: assortment of services that are provided to customers. These include: • Staff behaviour, appearance and uniform – staff interact with consumer during service delivery • Building exterior – the tangibility aspect of service • Equipment – “fitness” of equipments in facilitating experience
Furniture and fitting – reflect level of product quality • Signage – clue, interface that communicate offerings • Communication with the customers and the public; advertising, public relation, personal selling – information that may attract potential consumers to consume • Brand – identity and image of product • (other)
Product branding • The American Marketing Association (AMA) defines a brand as a "name, term, sign, symbol or design, or a combination of them intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of other sellers. • A brand is a symbolic embodiment of all the information connected to a company, product or service. A brand serves to create associations and expectations among products made by a producer. • Branding is your identity/image in the marketplace • Your company image is all about the appearance of your packaging- What is your company image saying to the marketplace? • always either has a negative or positive influence on the purchaser.
BRAND IDENTITY Environment: Building, facilities, furniture, decoration,… Other customers People Interactions: Service providers Customers (as co producers) Host communities Core Product Facilitating Product Supporting Products Extra products offered to add value to the core product and help to differentiate it from the competition Goods or services that must be present for the guest to use the core product
The objectives that a good brand will achieve include: • Deliver the message clearly • Confirms your credibility • Connects your target prospects emotionally • Motivates the buyer • Concrete User Loyalty • Your brand resides within the hearts and minds of customers, clients, and prospects
Product development • Increase product variety through • Width extension - different services added • E.g. MAS – flight services + vacation services (Golden Holiday) • Length extension – similar services added • E.g. MAS extend its flight to other destinations • Products with strong brand equity - A firm may leverage a brand’s equity with brand extensions, new products sold with the same brand name. • Because of the existing brand equity, the firm is able to sell the brand extension at a higher price than if it had given it a new brand, and the brand extension will attract new customers immediately • E.g. Emporio Armani Express
Sales and Profits ($) Sales Profits Time Product Develop- ment Introduction Growth Maturity Decline Losses/ Investments ($) MARKETING THROUGHOUT THE PRODUCT LIFE CYCLE • Two considerations: • Your product life cycle • Market product lifecycle Determine: Pricing & promotion strategies
introduction stage, customers get the first chance to purchase the good or service. • the goal is to get first-time buyers to try the product • focuses on informing consumers about the product, how to use it, and its promised benefits, • growth stage- Marketing’s goal is to encourage brand loyalty by convincing the market that this brand is superior to others. • marketing strategies may include the introduction of product variations to attract market segments and increase market share. • Marketing communication: persuasion to purchase • maturity stage, firms will try to sell their product through as many outlets as possible because availability is crucial in a competitive market. • Development of more distribution channels • More partnership • decline stage – keep and improve or delete
