Tourism Marketing Mix

The marketing mix is the most fundamental concept of marketing.

Coined in the late 1940’s, the term conceptualizes the marketer as a
mixer of ingredients, who sometimes follows a recipe as (s)he goes
along, adapting a recipe to the ingredients immediately available,
and experimenting with or inventing ingredients no one else has
tried (Culliton 1948). McCarthy (1960), was first to suggest the four
P's representing price, promotion, product and place distribution as
the primary ingredients of a marketing strategy. An expansion of
marketing mix classifies marketing variables into two categories: the
offering which consists of the product, service, packaging, brand, and
price; and the process or method which includes such variables as
advertising, promotion, sales, publicity, distribution channels, and
new product development (Frey 1961).All of these ingredients are
specifically designed to generate demand for the product or service
in question. Bitner (1990) later added people (employees) and the
services cape to the model recognizing the importance of
relationship development skills and the shopping environment in
marketing.
Marketing mix modeling is an analytical approach that uses historic
sales data to quantify the impact of specific marketing activities on
sales over time. The method accomplishes this by setting up a
predictive model where sales volume – such as transient sales -
becomes the dependent variable and the independent variables are
derived from measures of the intensity of various marketing efforts.
Once the dataset is assembled, multiple iterations are carried out to
create a model that best accounts for the changes in the sales
volume over time. Once the final model is deemed acceptable, the
model can be used to simulate marketing scenarios for a ‘What-if’
analysis. In these scenarios, the marketing manager can experiment
with reallocating the marketing budget across measured efforts and
see the direct impact on forecasted sales; allowing one to optimize
spends on specific marketing efforts that provide the greatest
potential return on investment. Once adopted, the results provide
two necessary ingredients of all formalized marketing plans, sales
volume goals and the specific marketing tactics and investments
required to reach these sales goals.

Role of Marketing Mix in Tourism

The role of the marketing mix in tourism is to bring the customers or

tourists to the destination, product or service that the tourism
company wishes to sell.

Tourism Marketing
A tourism marketing plan represents a strategy and is a combination
of techniques, tools and resources designed to achieve commercial
and social objectives marketing mix consists of product, price, place,
promotion and people (five Ps):
• tourism product that will be offered and the factors that compose
it;
• place of distribution; how the product/service will get to the client;
• sale price of the product and pricing policy to be applied;
• promotion to inform the potential consumers about the product
and its qualities; and
• people whose expertise, skills and attitudes are the key elements
of the brand.

Product
A tourism product is the set of assets and services that are organized
around one or more attractions in order to meet the needs of
visitors.
Key ingredients of a tourism product consist of:
 An attraction: These are the “raw materials” of the tourism
product and as such are part of the territory where the
business is located. They consist of the natural and cultural
resources, places and events that, by their characteristics or
location in a context, awaken the visitor’s interest and motivate
his/her action.
 Facilities and services: Tourist facilities refer to the
infrastructure, equipment and services that make the tourism
activity possible: the tourist enjoys the attractions and does so
in a safe environment.
 Accessibility: This facilitates visitors to access to the tourist
destinations, including infrastructure, transport and
communication services.
Tourism product development is designed to increase the income in
the sector. Tourism product development involves implementation
of a comprehensive plan of action that will guide towards dealing
with estimated increase in business over the short, medium and
long-terms.
The action strategies for the development and management of
tourist destinations should consider the needs and interests of all
stakeholders in the tourism system: local/ rural community,
entrepreneurs, investors, governments, tourists and other
stakeholders.
Tourism product development aims at long-term sustainable
development by the execution of a number of strategies. These
strategies bring into focus a generic idea to increase
competitiveness, build an inclusive industry by promoting closer
integration of people and develop and maintain the environment.

What is a sustainable tourism product?

Specifically, sustainable tourism products are “understood broadly as
meaning those that use resources in an environmentally responsible,
socially fair and economically viable way, so that users of the product
can meet their current needs without compromising future
generations from being able to use the same resources.
Measuring sustainability is a complex issue and the criteria vary
according to the product type and local conditions. Deciding what is
ultimately sustainable for a particular community is a balance
between local circumstances and expectations and best practice in
technology and environmental management.”

Place
In relation to the marketing mix, place refers to how an organization
will distribute the product or service to the end user or consumer.
The product must be distributed at the right place at the right time.
Efficient and effective distribution is important if the organization is
to meet its overall marketing objectives. If a business underestimates
demand and consumers cannot purchase products because of it,
profitability will be affected.
Distribution is the process by which the tourism product is circulated
through travel channels and agents that are in direct and indirect
contact with tourists.

Price
The price is the value that the consumer and provider establish to
enable an exchange. For consumers, the price they are willing to pay
equals the expected satisfactory experience. On the other side, the
provider seeks to cover his production costs and obtain the desired
benefits.
Pricing is based on three generic determinants:
• the business’s internal costs (to which expected benefits are
added);
• the satisfaction expected by the consumer and the maximum price
he/she is willing to pay;
• Competition among providers (which is ultimately determined by
the previous two).

Types of pricing objectives:

 Profit-oriented – aims to maximise profit, return on investment
 Sales-oriented – aims to attain/maintain market share, or to
maximize revenue/unit sales
 Competition-oriented – aim to match/beat competitors’ prices
 Cost-oriented – costs established, then profit margin added to
price (e.g., 10%)

Promotion
Promotion is the process (set of means and actions) designed to
inform potential visitors about the tourism product offered, sharing
with them its most attractive and innovative attributes. As such it is
usually integrated with distribution and implies communication
activities, including advertising.
But it is worth stressing that the mechanism called “word of mouth”
remains the main method of promotion. Along with the loyalty of
customers, the “unstructured” means are the most affordable,
offering higher yields for small businesses at a lower cost. Therefore
“invest in quality and save on advertising” is definitely the motto.
On the other hand, it is important to remember that an increasing
proportion of the so-called new tourists are independent tourists
who organize their own trips thanks to the wide availability of
information.

Distinction between paid and unpaid promotions

•Paid promotions includes:
– Advertising
 Shotgun marketing: aimed at broad audience
 Rifle marketing: aimed at target market
– sales promotions
– personal selling: method in which one party (e.g., salesperson) uses
skills and techniques for building personal relationships with another
party (e.g., those involved in a purchase decision) that results in both
parties obtaining value
•Unpaid promotions includes:
– publicity and PR
– media releases/media conferences, press kits,
– Sponsorships

People
The last P, people play a vital role in effective marketing. In fact, they
represent the actual service one is marketing and are also a critical
factor in service business. Most tourists can think of a situation
where the personal service offered by individuals has made or
tainted a tour, vacation or restaurant meal. Remember, people buy
from people and people buy a service that they like, so the attitude
and skills of all staff constitute the main aspect of the brand and
define the service quality.
People’s well-being is a crucial starting point to ensure best quality
services. Thus, issues related to decent work, social dialogue,
occupational safety and health, human resource development and
vocational training are key to enhance the potential contribution of
people to the “brand” or, in other words, to the tourism experience
as part of the “marketing mix”.

Another three P's are:

 Packaging
– Integration into a product offering various components of the
tourism product
–package with flights, accommodation, tours etc.

 Programming
– Related to packaging; ‘add-ons’ which can be incorporated in
package (e.g., additional tours activities etc.)
 Partnership
– Importance of networks; businesses working together on
promotional strategies, coordination
– Fly/drive packages, regional brochures, wine trails