Vertical Journey

X-Culture Team 87

Sarah Hermann: Market Analysis, Marketing, Copy Editor

wy823259@reading.ac.uk

UK

Guilherme Teixeira: Marketing

gteixeira.exch2018@ivey.ca
Canada
Weor Senenge Samuel: HR
samsenenge@yahoo.com

Kenya

Eduardo Otero: Marketing

eotero@espol.edu.ec
Ecuador
Luca Chierici: Entry Mode
luca.chierici07@gmail.com

Italy
Executive Summary:

This report analyzed the company Vertical Journey, an adventure tourism company located in

northern Peru, that wants to expand to new countries around the world, and provides

recommendations for the company in several key areas:

1. Market Analysis

a. An analysis of Vertical Journey as a company, and the industry and environment

it operates in brought to light the increasing interest in adventure tourism.

b. An analysis of the chosen market, Germany, highlighted the growing interest for

these tourists in adventure tourism, and travel to South America.

2. Marketing

a. Based on our market analysis, promotional tools were developed to support this

expansion.

b. These tools include the improvement of the company’s website, increase push on

social media pages, the use of Search Engine Optimization and Search Engine

Advertising, events, and tangible promotional materials.

3. Operations Management

a. The determined entry mode for Vertical Journey in Germany is through existing

well-known and large travel agencies that have enough reach for tourists.

The report will underscore the main points for each section, and providing supporting evidence

in the form of graphs and figures.

1
Contents:

1. Section I – Market Analysis

a. Industry and Competition Analysis

b. New Market Selection and Analysis

2. Section II- Marketing

a. Promotional Channels

b. Message

c. Promotional Materials

3. Section III – Operations Management

a. Entry Mode

b. HR

4. Conclusion

5. References

2
Section I - Summary:

Tourism in Peru is to become a leading industry in the several years- travel and tourism in Peru

contributed $19.6 billion to the country’s GDP in 2016.

In June 2016, the number of German tourists entering Peru rose 14.1%.

Adventure travel grew 65 percent per year from 2009 to 2013 and continues to expand.

Competitors exist nationally and globally.

Section I - Industry & Competition Analysis:

Vertical Journey has a wide range of competitors, both globally, and locally, in Peru and

Latin America. While Vertical Journey is the only company which specifically adventure tours in

Northern Peru, there are different competitors that offer tours major northern cities of Peru, such

as Trujillo, Chiclayo, Cajamarca; to coastal regions; and to national parks. However, tours in the

southern region of Peru, for instance in Lima and Machu Picchu still remain the most popular

destination for tourists from around the world. To understand the current situation for Vertical

Journey, it is critical to examine the trends in the tourism industry, as well as the main players in

the industry.

Tourism in Northern Peru:

Peru has become on the world’s most unique and fascinating tourist destinations ("Peru's

fast-growing tourism sector shows no signs of slowing down", 2018). Much growth in the tourism

sector of Peru is due to the Machu Picchu, as well as developing economic expansion, and

government intervention in developing policies to transform the tourism sector into a source of

employment and revenue. According to the Ministerio de Comercio Exterior y Turismo

3
(MINCETUR), the number of international

arrival in the country have almost tripled with

the total being 993,706 from January to

September in 2004, increasing to 2.6 million in

the same nine month period in 2015 ("Peru

tourism sector capitalizes on variety", 2016).

Moreover, tourism has contributed heavily to

the country’s gross domestic product in the last

Figure 1 - Contribution of Travel and Tourism to
decade, and this trend is predicted to continue in GDP (World Travel & Tourism Council, 2017).

the future ("Peru's fast-growing tourism sector shows no signs of slowing down", 2018). As can

be seen in Figure 1, travel and tourism in Peru contributed $19.6 billion to the country’s GDP in

2016, and this is expected to increase to $34.2 billion dollars by 2027 (World Travel & Tourism

Council, 2017).

With support from the government and the private sector, tourism in other regions of Peru

have the potential to become more prominent and profitable. Past infrastructure changes have

impacted the sector, and future projects will aid in making Peru an even more desired travel

location for tourists. A lack of infrastructure is still a hindrance to Peruvian tourism, however

large-scale projects are predicted to change this. For instance, major hotel chains such as Accor,

Hilton and JW Marriot have not only already set up hotels in Peru, but are aiming to build more in

the coming years ("Peru's fast-growing tourism sector shows no signs of slowing down", 2018).

4
SWOT Analysis of Vertical Journey:

Strengths Weaknesses

Only Peruvian company in North Region, first Seasonal Business, so cannot operate year
mover advantage round

Number 1 on TripAdvisor for Northern Small company - do not have as many

Region ("Vertical Journey Tripadvisor",
2018)
Good customer feedback - great reviews on
Tripadvisor
Different range of products - day trips or long
excursions ("Vertical Journey | Pleasure of
Feeling Alive", 2018).
Use personalization in their offers & provide
innovative trips and excursions
resources as competition
Do not have effective marketing team
Owners do not have any experiencing in
marketing
Only present in digital channels - Facebook,
Instagram, own website, TripAdvisor
Ineffective blog on website - not updated
regularly

Opportunities Threats

New trends based on adventure and eco- Low entry barriers - competitors can easily
friendly tours enter the market

High growth in tourism industry of Peru Environmental disasters, e.g. flooding, El

Peruvian government's decision to invest in Nino storms
infrastructure for tourism - opportunity to
attract more tourists to the area Costly repairing infrastructure after storms
disasters
Trend in authentic, non-touristy tours and
holidays in recent years

New digital platforms can be used to market

at, and contact customers (Phocuswright,
2017).

5
Adventure Tourism:

Research from the Adventure Travel Trade Association (ATTA) indicates that adventure

travel grew 65 percent per year from 2009 to 2013 and continues to expand. The number of

travelers is expected to expand 15 years from 1 billion to 2 billion people (Redal, 2016). According

to research, the following trends are what to expect in the tourism industry in the future. Firstly,

sedentary standardized travel packages are becoming less popular, while more active adventure

travel is prospering. Secondly, according to the U.N. World Tourism Organization, ecotourism

trips are expected to increase to at least 1.6 billion between now and 2020. Furthermore, nowadays

families are looking for travel experiences that educate and are transformative. Lastly, authenticity

is increasingly being seen as vital, and modern travelers value “doing” and engaging in activities,

rather than just sightseeing. Contemporary travelers want more immersive cultural experiences

(Redal, 2016).

Competitors:

Competitors are tour companies that offer tours in Peru, but also destinations all around

the world. Some of competitors which provide tours to the Northern Peru are Exotic Max, Paprika

Tours, Veloso Tours, Overseas Adventure Travel, Rainbow Tours and Journey Latin America.

Some of them organize Amazon Forest tours or city tours to different cities in Northern Peru. Also,

others offer more personalized and customized tours, tailored to customer needs and wants. There

are also tourism companies that do not specialize in adventure tourism, and focus more on luxury

tourism, or city tours, but these would be considered indirect competitors.

Other competitors include tourism companies in other South American countries, such as

Argentina, Ecuador, Chile, Bolivia, etc. Popular companies that offer tours in South America

6
include Exodus, Intrepid Travel, Contiki, G Adventures, Pure Adventure, Tucan Travel, and many

more. However, there are also several other competitors that are global, ranging from luxury tours,

family tours, and nature trips. Luxury tour operators include Abercrombie and Kent and

Kensington Tours, and International Expeditions offers natural and cultural tours. Other adventure

tour companies that offer adventure style tours in Peru, in other South American countries, and

other continents, include Adventure Life, Overseas Adventure Travel and Andeane Treks. Lastly,

Peru’s biggest tours operator is Condor Travel, which organizes customized and classic trips,

which are expensive ("Best Tour Operators in Peru - Peru", 2018).

Key Competitors in Proposed Market:

German adventure tourists have the possibility of contacting German tourism companies

based in Germany for South American, specifically Peruvian, tours, but can also contact global

tourism companies, as aforementioned. There are some other companies which have adventure

tours in northern Peru, but the advantage of Vertical Journey is that it is provides less expensive

tours in comparison to its many competitors. There are also German companies that provide

adventure tours in Peru, but also in other destinations around the world.

One company is called Trails, which offers nature and experience trips around the world.

In Peru, trips on offer include trekking in the Andes, exploring the Manu National Park, and

obviously touring Machu Picchu ("Trails Wanderreisen Erlebnisreisen Abenteuerreisen

Trekkingreisen", 2018). Another tour provider includes Viventura, an agency that provides 3 to 4

week adventure trips in South America, which usually includes exploring more than one country,

as the trips are quite long ("Abenteuerreisen Südamerika | Erlebnisreisen Südamerika | viventura",

7
2018). Lastly, E-Kolombus offers a 15 tour of southern Peru ("Südamerika Abenteuerreisen &

Expeditionen", 2018).

PESTEL Analysis Germany:

A PESTEL analysis was conducted to demonstrate the current environment of Germany.

Political Parliamentary government & democratic constitution;

Chancellor Angela Merkel heads executive state of federal government;

Germany belongs to the EU, United Nations, NATO, OECD and Group
of 20;

German leading right-wing party, AfD, was voted into parliament in the
2017 elections;

Increasingly difficult relationship with Turkey - one of Germany’s main

travel destinations.

Economic German economy is largest national economy in Europe, and the 5th
largest economy in the world by GDP;

Founding member of EU and Eurozone;

Population of 82,667,685 people, GDP of $3.5 trillion;

Social market economy - open-market capitalism but with provision of

certain social services;

Services such as telecommunications, health care & tourism contribute

most to the country’s economy;

Most important branch of German economic activity - industry

The world’s third largest automobile producer.

8
Sociocultural Ageing population;

Highly skilled, affluent workforce;

Can be considered modern multicultural society;

Ethnic groups (2010): German 91.5%, Turkish 2.4%, other 6.1% (made
up largely of Greek, Italian, Polish, Russian, Serbo-Croatian, Spanish);
Danish minority in the north, Sorbian (Slavic) minority in the east.

Technological Germany is leader in automobile and chemical industries;

Industry types - car-making; mechanical, electrical, and precision

engineering; chemicals; environmental technology; optics; medical
technology; biotech and genetic engineering; nanotechnology; aerospace;
logistics;

One of the world’s most developed infrastructure system in the world,

and has one of the world’s most developed ICT structures ("Germany -
Infrastructure, power, and communications", 2011; "Germany -
Information and Communications Technology | export.gov", 2017);

ICT is a German Government priority, and its policies focus on:

infrastructure, digital economy, digital workplaces, innovative public
administration, digital environments in society, and more ("Germany -
Information and Communications Technology | export.gov", 2017).

Environmental Germany mostly relies on fossil fuels as a source of energy;

For energy - petroleum, coal, natural gas, nuclear energy, hydroelectric,

solar, wind-powered;

Current environmental issues:

· Coal burning emissions - air pollution;
· Acid rain damaging forests;
· Hazardous waste disposal;

However - several laws passed to reduce emissions & protect the

environment.

9
 Legal The administration of justice is divided into five branches: ordinary,
labor, administrative, social and financial courts;

Germany's legal system has been shaped by constitutional law but is also
influenced by the law of the European Union and by international law;

Business-life in Germany is based on the principle of competition.

(“US News”, 2018; “UKEssays”, 2015)

European market:

An industry snapshot completed by the Adventure Travel and Trade Association (ATTA)

in 2014 showed the main source of books for adventure companies per continent (Cbi.eu, 2016).

This shows that Europe is the main source market for most adventure tourism destinations, except

for the Americas, where it comes second after North America (Cbi.eu, 2016). The ATTA

highlighted several trends about European tourists. Firstly, value for money has become

fundamental for the European traveler’s trip and destination choice. Secondly, on long distance

holidays, European travelers search for a variety of activities to do whilst at their destination, such

as walking, hiking, cycling, or cultural tours. Moreover, European tourist enjoy meeting local

people, and luxury has become a less important factor, specifically for adventure travelers. They

tend to enjoy more active days, and more comfortable nights. Lastly, European adventure travelers

increasingly research and plan their trip online, so a strong online presence is vital for adventure

tourism companies travelers increasingly research and plan their trip online (Cbi.eu, 2016).

German Market:

Research reveals that German tourists’ desire to travel to far-away destinations is steadfast,

but that a lot of travelers are favoring sites closer to home (Müller & Bonney-Cox, 2016). In 2015,

10
 29% of German tourists spent their holiday

at home, with Bavaria being the most

popular at-home tourist destination.

Furthermore, the second and third most

popular destinations abroad for Germans

are Spain and Italy, respectively (Müller &

Bonney-Cox, 2016) Furthermore, in a 2016

Figure 2 - Outbound Travel 2016 Per Country
(IPK International, 2017).
article, trends of for German tourists’

favorite destinations are as follows (DRV, 2016). Mediterranean countries will be amongst the

most popular destinations, but the popularity of long-distance destinations will also increase.

According to market research conducted by the German company Growth from Knowledge (GfK),

Middle East and South America are posting double-digit growth rates as holiday destinations. It is

also highlighted that books for destinations such as Turkey, which is typically popular for German

tourists, are below previous years, most likely due to hesitations because of political disruptions.

However, the report also states that Germans are fascinated by discovering cultures and countries

that are different from their own, despite crises in different countries (DRV, 2016). Statistics from

In the ITB 2016/17 World Travel and Trends Report, the number of worldwide outbound

trips have increased since the previous years, with European Outbound travel having increased by

2.5% from 2016 to 2017 overall. For Germany, outbound travel increased by 4%, one of the

largest increases seen in Europe, which is presented in Figure 2 (IPK International, 2017). For

adventure tourism, Germany has the largest market in Europe. This is not only because of its

outbound travel market size, but also because Germans are by nature more adventurous and

explorative than most other EU travelers. The proportion of hard adventure travelers is higher than

11
in most other EU markets (GEPA Exporters Portal, 2016). In June 2016, the number of German

tourists entering Peru rose 14.1%, with the previous year having 74.489 German Tourists who

travelled to Peru (Perutradeoffice.de, 2016; latinapress Nachrichten, 2016). That’s 8.4% more than

in 2014, and the German market is Number 3 in Europe for travel to Peru, after Spain & France

(latinapress Nachrichten, 2016).

Section II - Summary:

Objective 1 - Increase visibility through content creation on Vertical Journey website, social

media pages, SEO’s and SEA’s.

Objective 2 - Develop creative and eye-catching content in order to interest the potential

customer.

Objective 3 - Increase visibility through promotion at tourism trade fair ITB Berlin.

Section II - Marketing:

Based on our analysis of the industry and the market we want to enter, we have developed

suggested marketing efforts for Vertical Journey to consider. Our main focus for Vertical Journey

is to increase their visibility, particularly for the German market. This includes developing the

company’s online presence, mainly its website and social media pages, and pushing the company’s

main message through these pages, and through its print materials. This will be discussed in depth

in the following sections.

12
Promotion Channels:

For Vertical Journey’s marketing strategy, it was determined that a focus on online and

social media marketing would be most effective, as this fits with whom Vertical Journey is

targeting. Most adventure travelers are young, and therefore using online methods would be

beneficial, and as mentioned, most European adventure travelers used online methods when

planning their trip (Redal, 2016). These travelers use websites such as TripAdvisor, travel forums,

and social media like Facebook and Instagram (Redal, 2016). Furthermore, in regard to German

tourists, there has been an increase in the amount of people booking their holidays through online

methods, with over 38% of people booking their last holiday through an online travel agent in

2015 ("So buchen Deutsche ihren Urlaub", 2016). Moreover, 44% of 18 to 29-year-olds and 49%

of 30 to 45-year-old have completed their last booking by using online booking websites such as

Expedia.de ("So buchen Deutsche ihren Urlaub", 2016). Improving the overall website of Vertical

Journey and its accompanying social media pages is vital for increasing traffic on these pages,

increasing visibility, and expanding the amount of bookings.

Online Promotion Channels:

The number of adventure travelers relying on online searches (search for real number from

a reliable source) to plan their travel experiences clearly indicates how important is for adventure-

tourism-focused business and destinations to maintain a very strong web presence and a proper

online marketing strategy (Garland, 2014). The 6-year-old social network Instagram has been

going through extensive growth, achieving a record number of 500 million active users sharing an

average of 80 million photos a day (Siemens, 2017). The fact that we have a big appetite for

pictures and videos is not new. However, in recent years, this demand has been growing and

13
influencing our daily decisions (Siemens, 2017). Traveling is not an exception, and this is why

Instagram turned to be one of the most important tools for travel agencies’ marketing campaigns.

For instance, in 2015, the tourism office of the small town of Wanaka, in New Zealand, began

inviting and welcoming social “influencers” to visit the town and post about their experiences on

Instagram (Siemens, 2017). As a result, the tourism board of Wanaka achieved the fastest tourism

growth in New Zealand - 14% increase (Siemens, 2017). Hence, it is easy understandable how

Instagram is effective as a marketing tool. People engage with Instagram 10 times more than with

Facebook, and brands have been leveraging on these numbers when marketing their business

(Siemens, 2017).

Even though Instagram’s success, Facebook should not be left behind. A tourism business

needs multiple sources of bookings to thrive and remain sustainable, and Facebook is turning into

one of the most important sales channels today, with the highest conversion rate for all social

media ecommerce traffic at 1.85% (Macdonald, n.d.).

There is no doubt that online is the future of the tours and attractions industry, and Vertical

Journey could miss out sales, partnerships, and those valuable last-minute bookings if it did not

have a balanced distribution network with several strong booking sources. From this, we

determined that the most effective strategy for Vertical Journey is to pursue an online strategy that

focus on social media channels such as Facebook and Instagram, integrating its social media pages

on to its website and blog, in order to increase traffic on these platforms as well, and to create a

meaningful sales journey to its customers.

14
Facebook and Instagram:

Currently, Vertical Journey has 3,655 likes in its Facebook page and 2.856 followers on its

Instagram account. Adding to this fact, the number of daily posts on both social networks, as well

as the number of interactis on them, help us to understand that Vertical Journey's online presence

is rather passive than active enough as to leverage on those to increase their online sales. From

this, we recommend the company to go through a new online strategy that will require new and

further investments on Facebook Advertisement and more frequent posts on both Instagram and

Facebook.

Starting with the number of the daily posts, the company should agree on a content strategy

that will allow the company to create a customer/fan base within the social networks. This strategy

should have content for every type of customer, regarding the engagement phase he is with the

company. For example, if the company wants to target people that are still not aware about its

business, content such as impressive pictures and videos with short quotes that can attract people's

attention is more effective. Instead, for

those who already liked or follow the

company before, content with some

pictures of customers enjoying the

service offered by Vertical Journey, as

well as some articles and other kinds of

content that can influence people's'

decision and make them consider

buying the services offered by the

Figure 3 - Example Instagram Post in German
company is more effective. This

15
content can include articles suggesting Peru as a destination, photos with digital influencers

traveling in Peru or reviews made by previous customer of Vertical Journey. Finally, for those who

already consider purchasing the services of Vertical Journey but have not yet done so, posts that

can lead them directly to the company's purchasing page are the most effective, and both Facebook

and Instagram offer different possibilities for these kinds of posts.

As mentioned, regular posting on Facebook and Instagram is critical. One suggestion of a

way to promote this could be through regular posting about adventures and adventure tourism

quotes on its Instagram page. Though both pages are primarily in Spanish, languages can be

changed to suit the variety of customers Vertical Journey has. Since German tourists are being

targeted, posts in this language could be a fun tool for Vertical Journey to use. An example of a

suggested Instagram post can be seen in Figure 3, with an example of a quote in German.

Google AdWords:

As mentioned above, increasing traffic on Vertical Journey’s website is critical to improve

the sales of the company. One method of doing this is through Search Engine Optimization, known

as Search Engine Optimization, which is the process of influencing the online visibility of a

website in a search engine’s unpaid results ("SEO Tutorial For Beginners in 2018", 2018). The

company already ranks pretty well in terms of SEO, however some improvements would be really

beneficial to make the page more relevant in Google search around the world. For example, Google

AdWords, an online advertising service, could be used to understand the keywords that customers

search for when looking for Vertical Journey, or adventure travel in Peru ("Google PPC Online

Advertising | Google AdWords", 2018). What can be done is to create a table of relevant keywords,

divide them in subcategories and indicating their volume (number of people looking for those

16
keywords) Further, optimizing the website pages to try to include as many keywords as possible

in its texts is also vital.

Search Engine Advertising:

Another method Vertical Journey could pursue is Search Engine Advertising (SEA), which

is a form of Internet marketing that includes the promotion of a website by broadening their

visibility on the results pages of search engines, mainly through paid advertising (Sherman, 2007).

Paying to immediately reach high positions in Google Search should be also part of the marketing

strategy of Vertical Journey, especially for entering the new market of Germany. In order to

optimize the amount of money spent in Google AdWords, the company should use the relevant

keywords that we previously mentioned, and optimize its AdRank. The AdRank is a value given

by Google, which combines the value of the bid, the ad quality, and the expected impact of

extensions and other ad formats. To improve this value, Vertical Journey should improve the

landing pages’ quality and relevancy, by adding relevant keywords in the ads’ copy and ad ties to

the landing page.

Website Channel:

In terms of Vertical Journey’s website, there are several factors that need to be considered.

In its current state, Vertical Journey’s is not sufficient to attract new customers. There are several

proposed actions Vertical Journey can take to improve their website. Firstly, creating content is

vital in order to have a good position on Google. As as we mentioned earlier, using search engine

advertising should be a route for Vertical Journey to pursue. Relevant content can allow Vertical

Journey to make use of more valuable keywords in order to improve its ranking on search engines,

17
and to increase traffic on its website. Furthermore, as pushing Vertical Journey’s social media

channels is part of the main suggested marketing strategy for the company, links to its Facebook

and Instagram pages should also be provided on the website.

Also, the blog is not an effective tool in its current state, as the last postdate was in April

2017, and between 2016 and 2017, the article blog writing frequency was every 6 months. This

infrequent blog posting is not effective in boosting Vertical Journey’s visibility, and therefore

adding more exciting and interesting posts on regular basis could improve it. For instance, articles

about the different trips someone can do while exploring Peru, general tips and tricks about

travelling the world, and other hot topics that people normally search about on Google can be very

effective drivers to the website. Taking Red Bull's example, the energetic drinks brand uses its

website to post articles about topics such as “5 tips to avoid having your bike stolen when you

leave it unattended in the city”. Although Red Bull is associated to bike riders, the article is not

directly related to the brand neither mentions it. However, with such a demanded and interesting

topic, the brand is able to drive possible future customers to its website.

Another suggestion for the website could be to add a company background and history to

the website, which is great way to create an emotional connection with customers. Having an

emotional connection with customers can be very lucrative, as many studies show that doing so

can create value to a company, as these customers are less price sensitive and pay attention to

content created by the company (Zorfas & Leemon, 2016). What Vertical Journey could add a

company history, a vision and purpose, information on its staff leading tours, and more visuals,

such as professional photos that bring the stories that customers had with Vertical Journey more

alive.

18
Message:

For the message of the marketing campaign, Vertical Journey’s point of differences from

its competitors should be underscored. For one thing, Vertical Journey offers a difference on price,

as the company presents cheaper packages and deals than the competitors highlighted in the market

analysis. In addition, based on analysis of adventure tourists, tourists increasingly desire to

experience a culture and learn from local people when on holiday (Redal, 2016). Vertical Journey

employs people from all around the world and from Peru, which means tourists can experience

this. Also, since northern Peru is not very touristy, there is more opportunity for tourists to

experience a more “real” Peruvian culture, and to communicate with locals.

Moreover, based on our analysis, adventure tourism is on the rise, so the focus of the

marketing campaign’s message should be on the adventure and experience that Vertical Journey

offers, specifically the activities it offers, such as rappelling, rafting and hiking. This can you show

how Vertical Journey is different from its competitors, as most other companies in northern Peru

offer tours in cities and on the coast.

Vertical Journey’s marketing message should include the business’ core message –

unforgettable adventure tours with excellent guides in the beautiful, untouched northern region of

Peru, for an excellent price. It should also include what is on offer – Vertical Journey allows you

to go on an adventure by doing a variety of different activities such as rappelling, rafting, cave

exploring, hiking and exploring the Amazon rainforest. Finally, a call to action, a statement

designed to get the target audience to respond to it, is important (Lilyquist, 2017). Vertical Journey

already has a call to action “Discover your limits, feel free and alive,” however, this obviously

needs to be translated into German in order for it to fit with the German customer. A new call to

action in German was developed – “Entdecke Peru, Erlebe ein Abenteuer,” which means

19
“Discover Peru, Experience an Adventure,” as this sounds better in German than Vertical

Journey’s English call to action does. An example of an advertisement for Vertical Journey can be

seen above. This image also relates back to a suggested content strategy for potential customers

for Vertical Journey, as mentioned in the Facebook and Instagram section.

Lastly, the name and logo of Vertical Journey are up-to-date and modern in appearance, so

it was determined this would not need to be changed. To sum up, a focus on exciting the target

market’s sense of adventure and desire to explore new & faraway places is what should be

displayed in the marketing message. This should be underscored by less expensive price of the

tours Vertical Journey has to offer.

Promotional Materials:

In regards to

promotional materials, a

brochure that is to be

distributed at hostels and

hotels in Peru, and the partner

tourist agencies in Germany

allows for Vertical Journey to

reach its target market through

traditional means, not through

Figure 4 - Example Vertical Journey Brochure in German
online promotion. A brochure

in German displaying the prices in Euros would be ideal for the new market Vertical Journey could

target. An example of a brochure is shown in Figure 4.

20
PR & Events:

Another suggestion for Vertical Journey to advertise their tours is the world’s largest

tourism trade fair, the ITB Berlin, which takes place at Messe, Berlin annually in March.

Companies represented at the fair are hotels, tourist boards, tour operators, system providers,

airlines and car rental companies. It is possible to register for a stand to exhibit, and promotional

packages can even be provided to different companies. Most importantly, a sector of the fair is the

Adventure Travel and Responsible Tourism section, which is an ideal place for Vertical Journey

to advertise. Prices for different stands are shown in Figure 5. Exhibiting here would be great

promotion for Vertical Journey, as there are approximately 160,000 visitors for the first two weeks

of March, meaning a lot of potential customers could be reached ("ITB Berlin - Homepage", 2018).

Figure 5 - ITB Berlin Stand Prices ("ITB Berlin -

Homepage", 2018)

21
Section III - Operations Management

Entry Mode:

In terms of a suggested entry mode for Vertical Journey into Germany, a local partnership

was determined to be most effective. The choice of the specific way in which to operate in foreign

markets is based primarily on the costs and profitability. The costs can be classified in

Establishment costs, that are born only once, when the company is established, Specific fixed

costs, related to the remuneration of people dedicated to international activities and Variable costs,

that are strictly related to the management.

Partnerships with local distributors is the optimal entry mode according to the business

considered after considering the internal and external factors of Vertical Journey and the new

market of Germany. Specifically for Vertical Journey, partnerships with travel agencies in

Germany could be used to promote the company. The external factors that were analyzed were the

features, size and growth of the market considered. The desire for adventure tourism destinations

is increasing in Europe, especially among young people, who are looking for something different.

Germany was chosen as it is the largest market tourism in Europe and long distance travel is

increasing, especially to South America.

There are social and political barriers to consider. Germany is an “open minded” country,

it means that life is based on principles of free competition, it has an open market economy and it

has a multicultural society, so advertising Vertical Journey in Germany can involve not only

Germans, but also people from other countries. This can help spreading Vertical Journey all over

Europe and the rest of the world.

Internal factors that were considered are as follows. Firstly, the size and competitive

strength of the company is important to understand. Currently Vertical Journey is focused on local

22
tourism: this is verified by statistics, as about 70% of clients are Peruvians and only 20%

Europeans. The strength of the company is to offer something different from the classic tours

offered in Peru. In fact southern area of Peru is getting overcrowded since Macchu Picchu attracts

tourists from all over the world; as a result of that tourism is being decentralizing and so Vertical

Journey which proposed adventure trips in the northern area, can take advantage of that.

Furthermore, the company can count on offering a personalized service to its clients and

competitive prices compared to other competitors. Since the major management objective is to

become leader in adventure tourism business in the northern Peru, developing a business plan in

Peru only is not enough: that is why we have chosen Germany as a vector of promotion of Vertical

Journey.

Then, we focused on the targets of this new market entry. The service proposed is for

adventurous people, so the aim to is reach young people. So, it’s important to promote Vertical

Journey through social media, as mentioned above. As we said before the optimal market entry

mode is partnership with local distributor. We refer to travel agencies, that can advertise in the

best way the service proposed by Vertical Journey, applying to clients looking for a journey. The

second entry mode can be a sponsorship with sportive events and this is one is very significant to

reach adventurous youngsters and to get them in touch with the service proposed by the company.

Three suitable partners for Vertical Journey to partner with in entering Germany are as

follows:

1. TUI (Touristik Union International) is the leading tour operator in Germany. The company

with double seat in Berlin and Hanover was originally founded in 1923. TUI Deutschland

GmbH is a wholly owned subsidiary and is responsible for the operative business in

Germany. TUI serves around 30 million customers with more than 1,800 travel agencies

23
 in Europe, the United Kingdom and Ireland. The company owns the travel brands

Boomerang Travel, Viverde, 1-2-FLY, air tours, Gebeco, OFT TRAVEL, mountains &

sea, OX-TOURS and L'TUR (last minute travel). At the same time, TUI is still involved in

the container shipping company Hapag-Lloyd AG.

Contact Information TUI

Telephone: +49 0511-56780105 from 8:00 to 22:00

Email: https://www.tui.com/service-kontakt/kontakt/marketing-und-kooperationen/

2. The Thomas Cook Group is a British tour operator. In 2007, Thomas Cook Group plc

emerged from the merger of MyTravel plc. The Group's brands include Neckermann

Reisen and the Turkish tour operator ÖGER TOUR.

Contact Information Thomas Cook

Telephone: +49 0234 - 96 103 649 8:00 - 22:00

Email: https://www.thomascook.de/kontakt/#/collapseNavi14

3. DER Touristik has long been one of the largest tour operators in Germany. DER Touristik

owns the brands Dertour, Meier's Weltreisen, ADAC Reisen, ITS, Tjaereborg and Jahn

Reisen. In addition, DER Touristik also operates the special brands Dr. Ing. Holiday,

clevertours.com, camperboerse, hausboot-boerse.de and DERHotel.com as well as the

main site DER.com. These brands are complemented by the hotel chains lti hotels, Club

Calimera and PrimaSol Hotels.

24
 Contact Information DER

Telephone: +49 (0) 9588-8000

Email: http://www.dertouristik.com/en/media/media-contact/

HR:

Based on our analysis of what Vertical Journey needs to do, a suitable human resources

strategy was devised. What was determined was that the company and its offerings need to be

properly marketed to the target customers in Germany, so an employee in charge of the marketing

of Vertical Journey would be a vital step; recruitment, remuneration level and systems that will

guarantee the ideal balance of inspiration, retention, and cost. Secondly, a marketing employee to

be in charge of Vertical Journey’s new marketing initiatives on their social media and website is

important. Additional steps would include hiring additional tour guides and a country

representative.

Recruitment Tactics:

In order for the right people to be hired for Vertical Journey, these tools and techniques

have been organized.

25
Website Professional Networks Networking Competitors

When open positions are Business networking Vertical Journey will Competitors’ sales
available, Vertical sites such as LinkedIn leverage its presence at representatives will have
Journey will feature can be invaluable tourism expos, the most pertinent
them prominently on recruiting tools. Corporate occasions experience and abilities,
applicable areas of the and different so competitors,
corporate website, gatherings to build especially those in some
which will need to be networks and set up the sort of turmoil, can be
designed by the contacts that could be fruitful areas in which to
company. our next hire, or put target recruiting efforts.
Vertical Journey in
touch with prospective
employees.

Recruitment Process:

In the recruitment process, selecting talent through virtual platforms can be one method of

selecting the right candidates. In this way you can analyze the technical knowledge and skills of

the candidate that is required for Vertical Journey. In addition, a psychometric test, which are

designed to measures a candidates fit with a job based on personality and aptitude, can easily be

administered online to further analyze the suitability of the candidate ("Introduction to

psychometric tests", 2018). Finally, a video call to conduct an interview with the candidate is

useful.

The benefits of using a virtual platform is of economic savings as of time, and to have a

database of candidate information. The communication channels for recruitment should focus on

the main social networks, with attractive advertisements that include the benefits of being part of

the project and how much fun it will be to be part of the organization. In regards to the profile of

26
the candidate, knowing their age, technical knowledge and experience in previous work is

important, however, performing simulation activities to evaluate the skills of the participant will

be decisive for the selection of staff.

Hiring New Staff:

Since several new marketing communications recommendations have been suggested, an

employee in charge of the execution of these plans is crucial. This employee would be dedicated

to communicating on Vertical Journey’s social media pages, creating relevant content and

interacting with the customer. The ideal candidate would have to have secure knowledge in digital

marketing, in regards to the suggested use of social media, SEO’s and SEA’s, ideally one of 2 to

3 years’ work experience. Furthermore, the candidate should be able to communicate in both

English and Spanish.

In addition, since the market for Vertical Journey is Germany, as country representative

for this country would be beneficial when entering it. This person would be dedicated to the new

entry campaign, and should have a sufficient understanding of both the German and the Peruvian

market, and should also be proficient in both languages in order to communicate with stakeholders

on both ends.

Lastly, if there is an increase in tourists from the suggested country, and other countries,

due to the success of the marketing campaign and changing travel trends, additional tour guides

would be needed to compensate. The hiring of 2 to 3 new tour guides in the coming year could

help in meeting increased demand from tourists. Vertical Journey has tour guides from all over the

world, so hiring a German tour guide to meet an increase in German tourists is also important

consideration.

27
Standardized Training:

Standardized training is a useful method to create consistency and repeatability for the sales

team. For the tour guides, a structured, standardized training period is vital for the them to

understand and learn Vertical Journey’s organizational culture, as well as learn to provide the

service and quality is known for. The same goes for the office staff, the marketing executive and

country representative, as they need to be familiarized with the operations of the Vertical Journey

company and team in order to competently fulfill their duties.

Salary:

Salaries for marketing employees in Peru range between 1,649.72 - 1877.35 Pen/Month

depending on performance on the job, location, niche market and revenue

(tradingeconomics.com/peru/wages , 2017). Graduates will start at the bottom of the scale, unless

you have some relevant experience. Salaries for travel agents, sales rep and consultants recruiting

tourists for Vertical Journey in Germany, the range will be between 13,000 and 25,000 euros per

annum (www.expatica.com/de/, 2017). Salaries for tour guides should be based on the local levels.

In addition to fixed salaries for staff, salaries can be enhanced by various incentives and

performance bonuses. This ranges from sales commission payments, to incentives such as free

meals or retail vouchers in recognition of the most products sold (e.g. flights or insurance).

Concessions for personal holidays and travel are also an option.

28
Conclusion:

Based on our extensive analysis of the industry and company, as well as the in depth

development of marketing and operations management structures, we recommend Vertical

Journey to take into account the following recommendations:

● Enter the German market through partnerships with major travel agencies: TUI, Thomas

Cook and DER Touristik;

● Increase visibility through content creation on Vertical Journey website, social media

pages, SEO’s and SEA’s;

● Develop creative and eye-catching content in order to interest the potential customer;

● Increase visibility through promotion at tourism trade fair ITB Berlin;

● Take into consideration the suggested recruitment methods (what staff to hire, salary and

training suggestions) in order to ensure the human resources needed to succeed in its

international expansion.

29
References:

● 10 Best South America Tour Operators & Travel Companies with 34449 Reviews -

TourRadar. (2018). Tourradar.com. Retrieved 18 February 2018, from

https://www.tourradar.com/g/b-south-america-tour-operators#sort=rec

● A Pestle Analysis of Germany. (2015). UKEssays. Retrieved 18 February 2018, from

https://www.ukessays.com/essays/economics/a-pestle-analysis-of-germany-economics-

essay.php

● Adventure Tourism to Germany to Asia (2016). Ghana Export Promotion Authority.

Retrieved 8 March 2018, from https://www.gepaghana.org/market-news/adventure-

tourism-to-germany-to-asia/

● Best Countries - Germany. (2018). US News. Retrieved 18 February 2018, from

https://www.usnews.com/news/best-countries/germany

● Best Tour Operators in Peru - Peru. (2018). Fodors.com. Retrieved 18 February 2018,

from https://www.fodors.com/world/south-america/peru/experiences/best-tour-operators-

in-peru-266600660

● Buck, T. (2018). Breakthrough in push to form German government. Ft.com. Retrieved

15 February 2018, from https://www.ft.com/content/0549d214-fec4-11e7-9650-

9c0ad2d7c5b5

● BV, E. (2018). Working in Germany | Expatica Germany. Expatica.com. Retrieved 16

February 2018, from https://www.expatica.com/de/employment/minimum-wage-

germany-average-salary

30
● Garland, C. (2014, January 27). Social Media as an Important Channel for Adventure

Travelers. Retrieved February 25, 2018, from https://www.tourism-review.com/travel-

tourism-magazine-adventure-travelers-love-social-media-article2307

● Germany - Information and Communications Technology | export.gov. (2017).

Export.gov. Retrieved 22 February 2018, from

https://www.export.gov/article?id=Germany-information-and-communications-

technology

● Germany - Infrastructure, power, and communications. (2011).

Nationsencyclopedia.com. Retrieved 22 February 2018, from

http://www.nationsencyclopedia.com/economies/Europe/Germany-

INFRASTRUCTURE-POWER-AND-COMMUNICATIONS.html

● German tourists still want to travel. (2016). DRV. Retrieved 18 February 2018, from

https://www.drv.de/en/press/news-1/detail/german-tourists-still-want-to-travel.html

● Introduction to psychometric tests. (2018). Psychometricinstitute.com.au. Retrieved 7

March 2018, from https://www.psychometricinstitute.com.au/Psychometric-

Guide/Introduction_to_Psychometric_Tests.html

● IPK International. (2017). ITB WORLD TRAVEL TRENDS REPORT 2016/2017 (pp. 1-

29). Berlin: Messe Berlin GmbH. Retrieved from https://www.itb-

berlin.de/media/itb/itb_dl_all/itb_presse_all/World_Travel_Trends_Report_2016_2017.p

df

● Lilyquist, M. (2017). What is a Call To Action and How Do I Make One?. The Balance.

Retrieved 28 February 2018, from https://www.thebalance.com/call-to-action-1794380

31
● Macdonald, M. (n.d.). Which Social Media Platforms Drive the Most Sales?

[Infographic]. Retrieved March 13, 2018, from https://www.shopify.com/blog/12731545-

which-social-media-platforms-drive-the-most-sales-infographic

● Peru Tourismus: Wachstum aus Deutschland - Wirtschafts- und Handelsbüro Peru -

OCEX in Hamburg. (2016). Perutradeoffice.de. Retrieved 18 February 2018, from

http://www.perutradeoffice.de/newsinfo/peru-tourismus-wachstum-aus-deutschland.html

● Peru's fast-growing tourism sector shows no signs of slowing down. (2018). Oxford

Business Group. Retrieved 17 February 2018, from

https://oxfordbusinessgroup.com/overview/taking-one-fastest-growing-sectors-shows-no-

signs-slowing-down

● SEO Tutorial For Beginners in 2018. (2018). Hobo. Retrieved 28 February 2018, from

● https://www.hobo-web.co.uk/seo-tutorial/

● Sherman, C. (2007). The State of Search Engine Marketing 2006. Search Engine Land.

Retrieved 6 March 2018, from https://searchengineland.com/the-state-of-search-engine-

marketing-2006-1047

● Siemens, P. B. (2017, January 26). How Instagram Is Changing Travel. Retrieved

February 25, 2018, from https://www.nationalgeographic.com/travel/travel-interests/arts-

and-culture/how-instagram-is-changing-travel/

● So buchen Deutsche ihren Urlaub. (2016). Mynewsdesk. Retrieved 28 February 2018,

from http://www.mynewsdesk.com/de/pressreleases/so-buchen-deutsche-ihren-urlaub-

1319716

● Südamerika Abenteuerreisen & Expeditionen. (2018). e-kolumbus. Retrieved 22 February

2018, from https://www.e-kolumbus.de/abenteuerreisen/suedamerika/

32
● Tourismus Lateinamerika: 3,5 Millionen Touristen aus aller Welt besuchen Peru »

latinapress Nachrichten. (2016). latinapress Nachrichten. Retrieved 18 February 2018,

from http://latina-press.com/news/215326-tourismus-lateinamerika-3-5-millionen-

touristen-aus-aller-welt-besuchen-peru/

● Trading Economics (2017). Retrieved 12 March 2018 from

https://tradingeconomics.com/peru/wages.

● Trails Wanderreisen Erlebnisreisen Abenteuerreisen Trekkingreisen. (2018). Trails-

reisen.de. Retrieved 22 February 2018, from https://www.trails-reisen.de/

● Vertical Journey. (2018). Vertical Journey. Retrieved 8 March 2018, from

https://www.verticaljourney.pe/en/

● W. R. (2016). 5 Trends Shaping the Future of Adventure Travel. Adventure Collection.

Retrieved 18 February 2018, from http://www.adventurecollection.com/adventure-travel-

trends/

● Web@tourism-review.org, T. %. (n.d.). Social Media as an Important Channel for

Adventure Travelers. Retrieved February 25, 2018, from https://www.tourism-

review.com/travel-tourism-magazine-adventure-travelers-love-social-media-article2307

● What are the opportunities for Adventure Tourism from Europe? | CBI - Centre for the

Promotion of Imports from developing countries. (2016). Cbi.eu. Retrieved 18 February

2018, from https://www.cbi.eu/market-information/tourism/adventure-tourism/adventure-

tourism-europe/

● What is the demand for tourism services in developing countries? | CBI - Centre for the

Promotion of Imports from developing countries. (2017). Cbi.eu. Retrieved 18 February

2018, from https://www.cbi.eu/market-information/tourism/trade-statistics/

33
● World Tourism Organization (2014), AM Reports, Volume nine – Global Report on

Adventure Tourism, UNWTO, Madrid.

● World Travel & Tourism Council. (2017). Travel & Tourism Economic Impact 2017

Peru T (pp. 1-18). London: World Travel and Tourism Council. Retrieved from

https://www.wttc.org/-/media/files/reports/economic-impact-research/countries-

2017/peru2017.pdf

● Zorfas, A., & Leemon, D. (2016). An Emotional Connection Matters More than

Customer Satisfaction. Harvard Business Review. Retrieved 6 March 2018, from

https://hbr.org/2016/08/an-emotional-connection-matters-more-than-customer-

satisfaction

34