Marketing planning

Marketing Planning in Tourism and Hospitality: A Marketing Philosophy Approach

Kitchen and Burgmann (2010) define marketing as the coordination of the elements of promotion, place, product and price with a goal of promoting movement of services and goods from their state as a business concept to the point of consumption. However, this definition is generalized and therefore not aligned with industry-specific marketing philosophies. In the context of the tourism and hospitality industry, marketing refers to the integration of production processes, service delivery and consumer experiences with a purpose of achieving the highest level of customer satisfaction (Finne and Gronroos, 2009). This definition is relevant to the three main concepts upon which marketing in tourism and hospitality is based: relationship, delivery of value and trust. Therefore, marketing plans in tourism and hospitality must be aligned with the unique philosophy of the industry in the context of the marketing elements of production, selling and service delivery.

Peter and Donnelly (2011) point out that the production concept in tourism and hospitality is based on the philosophy that consumer favor services and products that are both affordable and available. This explains why companies such as the InterContinental Hotels Group focus on improving the efficiency of their production and distribution processes. The industry’s service and product concepts are grounded on the philosophy that guests favor services and products that offer the most innovative features, performance and quality. In this sense, effective marketing plans are those that define strategies of promoting innovation, performance and quality. Tsiotsou and Ratten (2010) point out that the marketing philosophy that defines the selling concept in tourist and hospitality is that guests consume services and products which are promoted across every channel. It is this marketing philosophy that motivates the use of the integrated marketing communication model by companies operating in the tourism and hospitality industry (Figure 1). A marketing philosophy approach helps to summarize the principles that influence marketing planning in tourism and hospitality. They include focus on consumer needs, delivery of satisfaction and superior value.

Figure 1: Integrated Marketing Communication Model

Analyzing the Current Situation: A Marketing Perspective

The design and implementation of marketing planning within the tourism and hospitality industry has evolved significantly over the years. In the 1950s, marketing communication was generalized (Jain and Haley, 2009). For example, companies used undifferentiated mass marketing strategies during this time. Between the 1960s and 1990s, marketing evolved from segment-oriented marketing to niche marketing. After 2000, companies in the industry individualized their marketing plans through customized marketing (Law, Leung and Buhalis, 2009). The current marketing situation is that of customized or individual-oriented promotion. The best example of individual-oriented promotion is e-marketing. It is however important to note that current marketing plans in the industry takes the form of mass customized marketing.

Mass customized marketing is mainly driven by modern technologies in marketing, such as social media, which are increasingly being adopted by companies, such as Expedia.com, for their interactive nature and personalized impact on the target audience. Figure 2 below illustrates how social media marketing plan works for companies within the tourism and hospitality industry.

 

Figure 2: Social Media Marketing Plan

The current situation of marketing in tourism and hospitality is effectively conceived through an understanding of emerging trends. For instance, the industry is characterized by increasing use of innovative technologies such as Web 2.0 tools. Emerging technologies make guests self sufficient (Lovelock, 2011). This is because guests are able to access a wide range of marketing messages and images via mobile devices. Therefore, the success of marketing plans in the tourism and hospitality industry is defined by the propensity of companies to use multimedia, such as videos, audio, text, animation and graphics. These forms of media can be accessed seamlessly across diverse devices and online platforms (Kitchen and Burgmann, 2010). The changing worldview on sustainability also influences marketing planning in tourism and hospitality. For instance, Hilton Worldwide demonstrates its sustainability agenda in its marketing communication messages with a goal of appealing to modern consumers who are increasingly sensitive to business ethics and environmental sustainability.

Analyzing Customers and Markets

Market research is a vital component of any competitive company. This is due to the fact that the analysis of markets and customers is effective when it is based on valid market research findings (Peter and Donnelly, 2011). However it is argued that market research is more critical to the survival of companies in the tourism and hospitality industry because of the numerous needs of consumers within each the market segments of the industry. Research on high impact marketing planning is linked to market research for its important role in creating understanding of the numerous needs of consumers during marketing strategy formulation. Various market research methods are recommended for companies in the tourism and hospitality industry. Nonetheless, hybrid market research designs should be applied by companies in the industry as they allow marketers to analyze a wide range of measures related to markets and customers, including market segmentation structure, customer satisfaction, brand preferences and opportunities for innovative services and products.

In accordance to Finne and Gronroos (2009), effective analytics on markets and customers are those that blend management and analytical skills of marketing teams to design promotional plans that are congruent with the marketing philosophy of the industry. Notably, current research on market and customer analytics in the tourism and hospitality industry is not sufficient as it does not address the need to integrate market research and analytics technologies or tools into the marketing planning process (Mohammed and Rashid, 2012). On the basis of this understanding, it is recommended that companies operating within the industry should adopt and implement innovative data analytics and technologies so that they can blend management and analytical skills for enhanced understanding of markets and customers and better planning of marketing communication strategies.

Planning Segmentation, Targeting and Positioning

Lovelock (2011) argues that Segmentation, Targeting and Positioning (STP) model is popular for its usefulness in enabling companies to center their marketing plans and strategies on customer needs. This model is specifically applied to design market plans that lead to the delivery of personalized marketing images and messages to customers. Segmentation, positioning and targeting are in many cases described separately by authors of marketing publications. However, it is notable that the three concepts are highly interrelated and influence marketing planning in a logical manner. For example, Wyndham Hotel Group applies the Segmentation, Targeting and Positioning (STP) model to design logical marketing plans that enable it to prioritize its service and product propositions to specific market segments. Figure 3 below provides a framework across which marketing plans flow on the basis of the Segmentation, Targeting and Positioning (STP) model.

Figure 3: The Flow of Marketing Plans

Planning for marketing segments in Wyndham Hotel Group involves the identification of its market segment in terms of their geographic, behavioral, psychographic and demographic characteristics. The company then targets specific markets in its marketing communications processes depending on their commercial attractiveness. Wyndham Hotel Group targets market segments that are commercially attractive in its marketing, including businesses, events, conferences and leisure groups. The company then positions its services and products through promotions that are designed to demonstrate the attractive or unique features that differentiate it from its competitors.

Planning Direction, Objectives and Strategy

The direction of companies, their objectives and strategy are often described in relation to each other as they define their plans for future survival in the industry and the competitive market. Kitchen and Burgmann (2010) assert that the planning of the direction, objectives and strategy of a company within the hospitality industry is effective when it is based on the application of business models for understanding both the internal and external forces that influence its competitiveness. In line with this assertion, the SWOT analysis framework is applicable understanding the internal and external environments of companies within the tourism and hospitality industry, which allow them to implement effective plans on their future direction, objectives and business strategies.

Hilton Worldwide applies SWOT analysis to understand its strengths and weaknesses in the context of planning for marketing its products in specific markets across the world. The SWOT analysis framework also allows the company to identify the opportunities that would enable it to gain competitiveness in new markets across the world (Mohammed and Rashid, 2012). Furthermore, the framework enables Hilton Worldwide to determine threats within its international markets that threaten its growth and success. These illustrations demonstrate that the SWOT analysis framework is effective in informing the planning of future strategies and designing business objectives that allow a company to utilize opportunities and to overcome threats in new markets.

Planning for Products and Brands

Tourism and hospitality is ranked among the most dynamic industries in the global business environment. Lovelock (2011) explains that this is mainly attributed to the dynamic nature of the needs and preferences of consumers within the diverse market segments in the industry. It is this dynamism which mandates companies to design effective plans for their products and brands. Therefore, companies plan for their brands and products for the purposes of survival in the changing market. Peter and Donnelly (2011) describe a brand as the slogan or name that represents a company’s product and service offering. Nonetheless, this definition of a brand is narrow because the brand strategy of companies in the tourism and hospitality industry is much more than their slogans or names. An extended view of a brand in the hospitality industry includes the nature of daily interactions with guests (Law, Leung and Buhalis, 2009).

Planning for brands and products entails designing effective approaches of enhancing relationships with customers. The InterContinental Hotels Group enjoys a strong image within its target customer segments because it implements a product and brand strategy that represents a specific identity and appeal. For example, the company seeks to elicit emotional connections between its customers and its services in order to create a strong brand identity. Tsiotsou and Ratten (2010) reveal that planning for products often entails designing promotional strategies that present a company’s products in terms of quality and cost effectiveness. However, this may not be the case for companies targeting a specific market segment. For instance, InterContinental Hotels Group plans its promotional strategies in a manner that they associate its brand with status and value, regardless of the fact that its services are relatively expensive.

Planning for Pricing

Kitchen and Burgmann (2010) argue that planning for pricing is the most challenging aspect of designing marketing plans due to the numerous considerations influencing the pricing of products. Researchers in marketing and pricing strategies agree that planning for the prices of goods goes further than production cost considerations. First, pricing objectives must be developed. The objectives that motivate pricing of services and products in the hospitality industry vary depending on the benefits a company prioritizes to achieve. Companies with a strong brand image, such as Hilton Worldwide price their products and services with a goal of demonstrating the value, status and quality that is associated with them. Other important considerations in the process of planning for price include market demand, the pricing environment and pricing strategy and tactics (Walker and Walker, 2012). The process of planning for pricing is illustrated on Figure 4 below. 

Figure 4: Process of Planning for Pricing

The process of planning for pricing also involves reflections on the value that a company offers through its services and products (Yoo, Lee and Bai, 2011). Nonetheless, this reflection should be based on comparative analysis of the products and services a company offers as compared to those of its direct rivals in the market. Another important consideration in planning for pricing is the need to support the company’s brand image. As much as consumers seek cost effectiveness and value, the price of a product may have result in undesired effects on brand image. The utilization of strategic models, such as Porter’s Five Forces analysis is recommended for companies within the tourism and hospitality industry as it allows them to become more competitive through pricing. Porter’s Five Forces analysis specifically enables strategic managers to consider the pricing environment in the context of the level of market rivalry, buyer power and supplier power during the formulation of pricing strategies (Kitchen and Burgmann, 2010).

Planning for Service and Distribution

Peter and Donnelly (2011) state that strategic managers must plan for services and the distribution channels in order to support efficiency and customer satisfaction. Companies operating in the tourism and hospitality industry focus on improving service levels because it is the prerequisite to competitive advantage. Notably, improvements in service levels should be based on a solid plan that is designed to meet specific needs and preferences among customers. Planning for services is a complex endeavor as it is influenced by the type of services a company offers and the preferred channels of distributing them to consumers. Services such as transportation, event planning and corporate services in the hospitality industry are planned differently because they take divergent distribution channels (Law, Leung and Buhalis, 2009). Regardless of this, planning for services should be focused on minimizing cost and leveraging information personalized service delivery.

Peter and Donnelly (2011) argue that planning for distribution becomes effective when it is congruent with the overall strategy of the business. For instance, planning for distribution channels should be congruent with the supply chain strategy of the company. Direct contact with clients is the preferred distribution channel of companies operating within the tourism and hospitality industry (Walker and Walker, 2012). Therefore, the planning of distribution strategies, such as in making hotel reservations, should be relevant to the distribution channels that characterize the industry. Wyndham Hotel Group runs a highly efficient distribution system due to its value for business partnerships. Meaningful business partnerships drive tourism and hospitality businesses as it allows them to reach out to a wider market.

Planning for Communication and Influences

According to Jain and Haley (2009), effective marketing communication is based on proper planning of communication strategies and influences which enhance the image of a brand within its current and new markets. Notably, understanding of the audience of promotional messages is the key to effective planning and implementation of marketing strategies. In addition, marketing communication strategies and influences should be informed by the findings of market research (Yoo, Lee and Bai, 2011). It is through this that the plan will be aligned with the needs and perceptions of consumers. It is notable that marketing communications in the tourism and hospitality industry entails a wide range of activities, including advertisements and public relations. This means that an effective marketing communication plan for companies operating within the industry is that which integrates all promotional activities with a goal of communicating common messages and images.

The characteristics of an effective plan for marketing communication can be used to illustrate the determinants of its success. Research literature presents a wide range of characteristics making an effective marketing communication plan. They include a plan that is audience-driven, dynamic, participative, measurable, and feasible and contains marketing mix elements (Peter and Donnelly, 2011). Therefore, the influences that lead to a popular brand image through marketing communications are defined by the effectiveness of the marketing communication plan. Successful marketing campaigns within the tourism and hospitality industry are based on the analysis of customers and the communication plan (Yoo, Lee and Bai, 2011). In this sense, a marketing communication plan should be evaluated to determine its effectiveness in creating appeal to specific segments of the market. This argument is based on the fact that marketing messages that appeal to one group of audience may not work for other groups (Jain and Haley, 2009). The specific influences that contribute to the success of a marketing plan are embedded in the marketing mix.   

Planning for the Marketing Mix

The choices made in the planning for the marketing mix are influenced by four of its main elements. They include the product or service, promotion, price and place. For instance the success of Wyndham Hotel Group’s marketing communication strategy is attributed to the fact that it is based on the 4Ps of the marketing mix. However, in the planning of its targeting strategy, Planning for place entails ensuring that the product or service is delivered with a view of meeting the needs of customers for convenience and efficiency. Price considerations are also important as they allow companies to compete favorably through reasonable pricing (Peter and Donnelly, 2011). Furthermore, the promotional strategies most suitable for achieving the objectives of a company must be planned. Effective promotion is that which involves the use of a wide range media, as provided by the integrated marketing communication model (Reid and Bojanic, 2009).

The marketing mix has been expanded through research and experiences in marketing communication practice. For this reason, it is recommended for Wyndham Hotel Group to consider applying the expanded marketing mix, which includes the physical environment, process and people. This means that the company should plan on how to create a physical environment that is most appealing to its consumers. Even though this is part of the business strategy, it is ignored because of the assumption that appealing physical environments define all activities and service delivery processes in the tourism and hospitality industry. However, planning for physical environment allows companies to align their business surroundings with the tastes of its consumers in different locations and cultural environments (Law, Leung and Buhalis, 2009). Furthermore, companies should plan for effective people management strategies that allow them to implement efficient service delivery processes.

Planning Implementation and Control

Baker and Cameron (2008) state that implementation and control refers to the processes which ensure that strategic marketing objectives and goals are achieved. It is argued that the two elements of marketing should be integrated into the marketing plan in order to support marketing activities and to manage resources for an efficient, innovative and effective marketing campaign. In addition, the marketing communication process should be monitored and evaluated to ascertain that promotional efforts are coordinated, aggressive and focused on achieving shared objective (Yoo, Lee and Bai, 2011). In marketing planning, strategies used to mitigate deviations from the original marketing plan should be established (Yoo, Lee and Bai, 2011).

Reid and Bojanic (2009) point out that planning for implementation and control specifically involves defining the mechanisms through which quality is to be managed. This includes specifying mechanisms for improving communication, teamwork and creativity in the design and implementation of marketing communication images and messages. In addition, strategies of motivating the marketing team should be integrated into the marketing plan. The specific processes that define control activities of a marketing communication campaign include measurement of value indicators, management of tolerance ranges and measurement of outcomes (Baker and Cameron, 2008). These processes sound complex as presented within marketing planning literature but they basically involve the process of leading marketing campaigns for effectiveness in the achievement of marketing goals and objectives.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

References

Baker, M.J. and Cameron, E., 2008. Critical success factors in destination marketing. Tourism and hospitality research, 8(2), pp.79-97.

Finne, A. and Gronroos, C., 2009. Rethinking marketing communication: From integrated marketing communication to relationship communication. Journal of Marketing Communications, 15(2-3), pp.179-195.

Jain, S.C. and Haley, G.T., 2009. Marketing planning and strategy. Cincinnati South-Western Publishing Company 1985.

Kitchen, P.J. and Burgmann, I., 2010. Integrated marketing communication. John Wiley & Sons, Ltd.

Law, R., Leung, R. and Buhalis, D., 2009. Information technology applications in hospitality and tourism: a review of publications from 2005 to 2007. Journal of Travel & Tourism Marketing, 26(5-6), pp.599-623.

Lovelock, C., 2011. Services marketing: People, technology, strategy. Pearson Education India.

Mohammed, A.A. and Rashid, B., 2012. Customer Relationship Management (CRM) in Hotel Industry: A framework proposal on the relationship among CRM dimensions, Marketing Capabilities, and Hotel performance. International Review of Management and Marketing, 2(4), p.220.

Peter, J.P. and Donnelly, J.H., 2011. Marketing management: knowledge and skills: text, analysis, cases, plans.

Reid, R.D. and Bojanic, D.C., 2009. Hospitality marketing management. John Wiley and Sons.

 

Tsiotsou, R. and Ratten, V., 2010. Future research directions in tourism marketing. Marketing Intelligence & Planning, 28(4), pp.533-544.

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