All over the world, tourism is seen among those industries which have a phenomenal growth rate. Tourism is mainly a service industry as no physical products are produced, but rather different types of services are being offered to a large variety of customers.
It is mainly the augmentation of different interconnected industries and trades such as transport, hotel industry, etc.
Due to the involvement of different socioeconomic activities such as creating interests among the people fora certain location, transporting them to a particular location, providing lodging and food, and providing various means of entertainment, and so on, the nature of tourism is quite complex.
In fact, tourism has really helped in facilitating incredible infrastructural development along with the overall development of that region.
In fact, tourism can be treated as one of those distinct industries which help the country to earn foreign revenues without exporting national assets.
A person or a group of people can conduct various activities involved in tourism, which can result in motion from one place to another.
Motion here refers to the movement of people from one country to another for any activity like sightseeing at one place or different locations, entertainment which can help in gaining knowledge and awareness of various cultures and civilizations, history, etc.
Different activities that involve traveling and lodging of a person away from his or her usual environment for less than six consecutive months and more than 24 hours for leisure and business purposes (the person should not & performing any activity which can result in earning) are included in the tourism industry.
Simply put, the activities performed for traveling & leisure, pleasure or business, and the various means for fulfilling activity are included in tourism activities.
Market Segmentation of Tourism Services
Traditional marketing theory gives main importance to the proper element of various activities such as segmentation, targeting, and positioning for gaining effective communication in a manner that is executed by the tourism organization for ensuring the maximum satisfaction of the tourists and fulfillment of varied tourism-related requirements.
Alternately, with the help of the segmentation, the tourism organization can have a feasible method of determining their target market and thus planning and developing the various strategies so that the customers can be served effectively.
All the individuals who are motivated, able, and have the chance to visit a certain location or place of attraction will be included in the tourism market.
Market segmentation is mainly an activity of taking the customer market in focus and dividing it into small groups of homogeneous individuals having identical needs and requirements and behavioral traits.
More sophisticated market segmentation occurs when there are greater chances of implementing the targeted marketing plans for a certain destination or attraction to an exclusive, usable tourist group in place of marketing to the overall market randomly.
Thus, while determining a tourism marketing strategy, there is a very distinct place of market segmentation.
The table below enlists the four classic market segmentation methods:
|At the very fundamental level, the tourist-consumers are defined as per the geographic location, presuming that the location where individual lives have a greater impact on his/her behavior.||Tourist-consumer behavior is defined on the basis of gender, age, social class, family lifecycle stage, income, and various other factors.|
|It is considered that personality or lifestyle affects the buying behavior of the tourist-customers.||The main focus remains on certain tourist products for the analysis of tourist consumers’ behavior, and the market is segmented on the basis of behavioral differences such as degree of loyalty, benefits sought, buying patterns, etc.|
The different types of methods used for segmentation are described as below:
1. Geodemographic or Profile Segmentation: This is the segmentation process in which the geographic and demographic segmentation variables are grouped for the analysis of tourists on die basis of the location where they live.
In fact, this method is quite helpful for analyzing the neighborhood’s various demographic characteristics.
The marketing organizations of destination can develop effective communication with the tourists by segmenting the tourism market on the basis of one or more profile factors like age and socio-economic group.
Despite having the ease of developing and implementing these profiles, these are the prime relatively weak estimators about the interest of the tourists and the corresponding tourist behaviors.
In recent times, most commercial specialist firms have tried a lot to develop more advanced geodemographic segmentation so that a more sophisticated method can be developed for tourism marketing.
The geodemographic database systems, which are developed by various commercial organizations such as Experian, Eurodirect, CACI, etc., are being used by many competitive tourist destinations and attractions.
These segmentations help these destinations and attractions to classify the neighborhood as per the range of other customer-related traits.
2. Psychographic Segmentation: In this type of segmentation, the people are combined on the basis of their lifestyle and personality traits.
Susan Horner and John Swarbrooke in the year 1998 denoted psychographic segmentation as ‘fashionable yet difficult to execute’.
This complexity is mainly originated due to a combination of intangible personality and lifestyle variables like interests, opinions, beliefs, aspirations, attitudes of prospective visitors or tourists.
Due to various difficulties and weaknesses of the different segmenting methods in providing the managers with the correct inputs regarding tourists, a psychographic segmentation method was developed to have a better understanding of tourists’ behaviors.
In comparison to other types of segmentation methods, psychographic segmentation is treated as lesser scientific.
With the technological developments, this subtle and softer segmentation method is treated as more tourism-friendly.
In fact, comprehensive consumer information can be obtained with the help of this sophisticated psychographic segmentation, and it ensures that there can be greater control over the visitor economy and designing and development of destinations that can fulfill the requirements of various segments of visitors.
3. Behaviouristic Segmentation: The main focus of the discussed segmentation is on the tourist or the visitor and are able to provide the most accurate, useable, and comprehensive profiles of the visitors.
But the relationship of the customers with the destination or the tourism product is not discussed. There are greater chances that different interactions with the destinations or other tourism products can result in individuals having similar geodemographic and/or psychographic profiles.
Apart from this, the behavior analysis of the tourists with respect to certain tourism or destination product is also of quite significance.
There are a number of facets of this kind of segmentation, and the main focus in this segmentation remains on the relationship between the destination product and the tourists.
For example, if travelers are visiting a place for the very first time or they are regular visitors to a certain destination, then this particular segmentation analyses, what is the objective of their arrival, their attitude towards the destination, their loyalty towards a particular place, etc.
4. Multivariable Segmentation: As we have understood the four classic segmentation bases, it is quite evident that a multivariable segmentation approach is adopted by some of the most successful tourism organizations and destinations.
In this method, attempts are made to derive the portfolio of significant traits, which is devised from the four methods according to the tourist market under consideration.
With the development of geodemographic systems, they have transformed into multivariable ‘packages’ by including the demographic, psychographic, and geographic variables so that the entire market can be divided into smaller, useful, and actionable segments.
Similar to every other segmentation methodology, in the multivariable segmentation strategy, different tourists are combined as per their requirements, desires, and backgrounds.
The below-mentioned criteria can be used for judging the effectiveness of tourist market segmentation:
i. Effective and Distinctive: There must be relatively identical requirements of the tourists who are combined in a certain segment, and it also must be completely different from the other segments.
ii. Measurability: In order to make sure the commercial viability of a certain segment, it is very important to determine and have a good knowledge of the customers, their traits, and behaviors.
iii. Accessibility: With the help of an exclusively designed and cost-effective marketing plan, the tourism organization should reach the segments.
iv. Actionable: The destination management firms should have some resources so as to utilize the marketing opportunities offered by the process of segmentation.
Marketing Mix of Tourism Services
The 7P’s of the marketing mix for the tourism industry is being discussed as below:
1. Product: There are mainly five levels of the products which must be considered by the marketer while planning its market offering, The customer value will be augmented by each level, and these levels will help in creating customer value hierarchy.
The different levels of the products that are being offered to the tourist by the tourism organizations are explained as below:
i. Core Product: The destination or the location is the core product that is being offered by the tourism industry. This is called core product as the destination where the tourists want to visit their main focus.
ii. Basic Product: Ticket booking, transport, sightseeing, and hotel booking fall under the category of basic products that are offered by the travel and tourism industry.
iii. Expected Product: These can be seen as the products which are expected by the tourists from the tourism organization.
Availability of the seat at the required time, the superior quality of services for business travelers, faster check-in, precise information for the senior manager, reliable inputs, and information related to various packages, various alternative routes to a certain location are some examples of expected products.
iv. Augmented Product: These are the products that tourism companies offer so that they can differentiate themselves from the competitors.
These kinds of products can be transformed into expected products in the future. The typical example of these are customized meals onboard, laptops on request, Wi-Fi connection, flatbeds in business class, tele-checking, 8 hours booking in hotels, internet access as complimentary for the corporate packages, and so on.
v. Potential Products: These can be seen as the future products which are offered to the customers by the companies.
For example, hovercraft for traveling, underwater tourism, and so on. In fact, the addition of a casino and a shopping mall at the airports are being planned by Virgin Atlantic Airlines.
2. Price: While deciding on the pricing decisions, the product-service mix used by the tourist organization is of utmost significance.
As per the quality of the service, which is customers along with the target market, prices must be Various internal factors such as pricing policy of the firm, external factors such as tourist spot or location are the key factors which can affect the pricing decisions.
Discounting pricing methods should be used by these organizations, which can incorporate trade discounts, cash payments, and seasonal discounts, etc.
However, by offering these discounts, tourism organizations can face various issues related to their image as it can indicate the low quality of the service to the value-oriented customers.
3. Place: Travel agents are the main sources through which the services of many tour operators are purchased. However, in order to avoid these middlemen, some customers prefer to approach directly to the tour operators.
For example, the branches of Cox and Kings are located in different locations all over the country, and thus customers can approach them easily. Thus, for Cox and Kings, the selection of location is quite vital.
The role of transportation is quite crucial in the tourism industry. Tourists all over the world can reach different locations with the help of transportation.
In fact, a major logistical role is played by transportation, in the case of tangible products in the tourism industry for the products such as souvenirs and cuisine.
4. Promotion: A deep impact can be made through formation of awareness. The responsibility of informing, persuading, and analyzing the probable tourists in the correct manner lies in the tourist organizations.
The different types of promotional tools must be utilized by the managers optimally so that they can attract a maximum number of habitual tourists.
The duration of stay, increase in visits frequency can be boosted by promoting those locations which are still untapped or not fully utilised. The different factors of tourism promotion are discussed as below:
i. Advertising: Both existing as well as potential customers, receive important information through advertising as it has a wide coverage.
The main objective of advertising is to spread awareness about the various travel offers proposed for resorts and various related attractions so that the buying decisions can be affected.
By using the visual tools and means of sense and events, the factor of intangibility can be addressed. For this purpose, well-arranged restaurants and cafeterias, swimming pools, hotel bedrooms can be used.
ii. Publicity: The main concentration remains on improving public relations with the help of a rapport created with the media personnel and seeking their personalized help so that the business can be promoted.
The creation of a positive image of the tourist organization can be achieved through the news items published in the print media, as such articles are considered to be reliable by the potential tourists.
Similarly, photograph travel editors, publicity stories, and so on can be used.
iii. Sales Promotions: These are the activities that are performed for a limited period to increase the sales at peak demand periods in order to sustain the market share of the tourism firm.
Sales promotions can be quite helpful in launching a product or promoting a complementary or modified product.
These methods are mainly aimed at price-sensitive customers. In order to increase the sales, various methods can be used and as per the requirements vis a vis the emerging business trends these tools can be used by the tourist professionals.
For example, in case of tourism industry some kind of giveaways such as first aid sewing kits, shower caps, shampoos, and so on can be given to the customers.
In fact, some fruits and welcome drinks can also be offered to the VIP customers in their rooms.
iv. Word-of-Mouth Promotion: Word-of-mouth promotion is the main source of communication about tourism, and it can be treated as a word-of-recommendation.
Particularly in the case of the tourism industry, it has been experienced that the word-of-mouth promoters play the role of ‘hidden salesforce’ as they really assist in the sales process.
The high credibility of the channel, particularly in the eyes of the probable tourist, is the main source of the high effectiveness of this mode of promotion.
Due to this credibility, it is very important for the service provider to adhere to the service quality which they promise.
Thus, the marketers are required to be vigilant, looking for the opinion leaders, treating them especially in order to promote the process of stimulating and creating demand.
v. Personal Selling: The personal skills of a person decide his or her expertise and abilities to sell. In fact, the person selling the main pillar on which hotel and travel business depends.
Well-educated and trained sales personnel contribute a lot to intis development of the tourism business. The service provided by these travel agents and travel guides has been influencing the tourism business development as they act as information carriers.
Personal selling helps in presenting tangible products, intangible services, or different types of ideas to the target customers.
One must notice that in the case of the tourism industry, the individual who attains tourists act as a vital constituent of the product, similar to the sales representatives, who are crucial for interacting with the customers.
When a tourist reaches to the tourist locations, all of his/her needs are addressed by the resort representatives and thus each member plays a significant role in ensuring the full satisfaction of tourists.
Tourism industry greatly depends on the famous saying, “the customer is always right.” The impolite behavior of a tourist guide, surly or a haughty coach driver, or a solvent waiter cannot be compensated by any decrement in prices.
This can be seen as evidence that the performance and behaviour of sales and travel staff is closely associated with the travel business,
vi. Telemarketing: In this method of selling, the business is marketed with the help of a professionally adept telemarketer.
The success of this element greatly depends upon the communication skills and the technology used. In the absence of the adequate telephonic services, the efficient discharge of travel agents’ duties, offices of airways, receptionist, and secretaries is not possible.
Apart from , this, selecting a personally-committed, professionally sound person is very important and he/she must possess inherent qualities of innovation, creativity and imagination.
vii. Exhibitions: State and national tourism promotion boards, technology providers, travel agents and tour operators, education institutions in the field of hospitality and tourism, airlines, car rentals, cruise liners, holiday financiers, etc., can take an active part in tourism exhibitions.
In fact, in recent time, for the aggressive promotion of various countries, the foreign tourism promotion boards, like the Dubai Tourism and the Mauritius Tourism, are also participating actively.
5. People: The management of human resource plays a very critical role in the tourism industry, similar to any other industry.
As the tourism industry is the combination of different individuals providing various services, therefore, in the absence of world-class professional excellence of travel agents, tour operators, and travel guides, this industry will surely lack efficiency in work.
Therefore, new technology is a major factor in the travel agent offices, but the various processes are greatly supported by the manpower and the other staff members.
Professional excellence is very important for the travel guides as for the positive image of a certain tourist spot, adequate corporation is essential, and if it is not done, then even the world-class services will become worthless.
For this purpose, the efficient management of human resource is also important for the tour operators.
The ongoing training program is quite important for the effective management of staff in order to have a close connection between the human resource qualities and technological development.
To successfully satisfying the needs of the customers, a lot of credentials will be required. Firms need to create a conductive environment and should chiefly emphasize providing various incentives to the human resources so that they can develop a greater performance orientation.
Also, suitable significance should be given to value-orientation, perfection, and efficiency generation activities so as to form an effective employee orientation.
For facilitating the correct types of manpower to the industry, the role of government is quite vital. For this purpose, a number of government and private institutes have been established to provide suitable training to the tourism personnel.
Keeping the specific requirements of the different target groups, the training courses are developed by these institutes.
6. Process: It can be seen as a process of dealing with the transaction supplying information, and providing services acceptable to the consumer and profitable to the organization.
In order to ensure the adherence to the definition of process, the tourism organisation must identify the crucial incidents in the whole process in which the customers can either accept or reject the services on the basis of zone of tolerance or being effective or ineffective.
Apart from this, in order to determine the various critical moments in the process, the blueprint concept should be adopted.
7. Physical Evidence: This is one of the most crucial factors which affect the tourism and travel industry. There are two environments where physical evidence becomes very important:
i. Environment in which the Sales Occurs: While buying a product, it is not sure whether the customer will enjoy it or not.
At the same time, various factors such as the layout of the room, furniture, lights, temperatures, noise level, and so many other factors can affect customers’ expectations and emotions.
In fact, for the customers who buy tourism products and services online, the appearance and user interface of the websites also play a significant role in physical evidence.
ii. Environment where the Product is Consumed: In the case of the travel industry, the product which has to be experienced is of ultimate significance, and thus, in order to attract and woo customers, extensive facilities are utilized.
Wi-Fi connection in hotels, tele check-in, 8 hours, flatbeds in business customised meals onboard, internet access as complimentary for the corporate packages, hotels providing laptops on requests, etc., can represent the tangible aspect of the tourism service.