Chapter 7

“ Pricing Tourism and Hospitality

Product”
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• Learning Objectives:
The learners shall be able to:
❖ Describe pricing and he different variations;
❖ Identify internal factors affecting pricing;
❖ Analyze external factors affecting pricing;
❖ Combine various pricing components for a good pricing strategy;
❖ Plan for the best pricing approach for a business in the industry; and,
❖ Propose for an appropriate positioning in the industry.
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A deep understanding of price is highly significant in

the tourism and hospitality industry. The “right” price
must please the tourism simultaneously with attaining
the pricing objectives of the tourism and hospitality
business. there should be a good combination of price
and quality in order to produce value for money based
on the perception of tourist. As observed, both offline
and online hotel room rates vary as dates and type in.
tourist are often confused on how hotels do their
pricing.
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• What is pricing?
Price is the money paid by customers in exchange for
any valuable product or services. Pricing is one of the most
vital elements of marketing mix. In fact, most marketers
regard it as a key success instrument in the market
competition. This is a proven reality even in the tourism
and hospitality businesses. Hence, operators of hotels and
tourism business make use of pricing strategy to achieve
their organizational objectives.
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• Commonly, pricing in the industry such as hotels, resorts and the likes is done according to the following:
1. Per person pricing- this is setting the price per person like adult and children prices. Usually applied by
activity or attraction and transport operators or backpackers accommodation and camp sites. The
price for adult is different from a child and even for senior citizens which is usually discounted.
2. Per unit pricing- Here a price for one unit of the product such as the price per night is set. This is
normally the standard way to price accommodation. Normally the advertise price for two people
hence if the accommodation fits more than two guests it can have a combination pricing with
additional adult and extra child rates.
3. Single or double occupancy- This is common for B&B’s accommodation wherein there is a single rate
and a double rate. B&B’s is a small lodging establishment that offers overnight and breakfast. Single
room has single accommodation and double room can be shared by two persons. Breakfast buffet is
included in the price. Charges of two buffet will be added in case of double occupancy.
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Usually pricing differs in accordance to location, seasons, brands or even time of the day. This
nature of variation in pricing is called differential pricing or price discrimination wherein customers are
charged with different prices for the same exact product. Most businesses in the tourism and hospitality
industry sector makeuse of this strategy. For instance, hotels change their prices more often due to the
following reasons:
1. Room occupancy and seasonal demand- The biggest influence when it comes to hotel pricing are room
availability and customer demand. Most prices increase during the peak months for tourist or there is
a conference or festival happening in a certain place when there is high demand. During low
demand, a lot of hotel rooms are booked for a fraction of the cost.
2. Hotels central location- Hotels that are nearest to the commonly visited tourist attraction or centrally
situated are premium priced. Those that are further downtown areas or located in remote places are
priced lower. However, some modern tourist wan ted to make savings and do not mind travelling
further to sightsee the city’s point interest.
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3. Type of room- In popular tourist destinations, competition is really prevalent; hence variation of the
category of room offered to book also differs. Travellers have room option such as standard, family
and suite. Often through some modern tourist wanted a room with sea view, bigger sizes of bed and
other additional amenities that are added to overall price.
4. Price matching between brands- Possibly budget plays a big influence when travellers match the price with
various hotel brands. Smart tourist often compare prices of hotels prior to booking their stay.
5. Time of the year- Smart travellers in order to save money look for and visit destinations that are on
their off-season. It is still possible to visit favourite destinations during peak seasons booking
weekdays instead of weekends. During weekdays the demand is lower and so is the price.
6. Summer hotel rates- during summer vacations, hotels priced their higher. In order to maximize their
income before the off-season, most summer destinations increase their prices. Although, there are
hotels in some areas that are not affected by seasonal variations because they have visitors all
year-round. Hence, this hotels have steady pricing.
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On the other hand, airlines prices vary because of competition, supply,

demand, and oil prices. Besides, airlines make use of load factor estimation in
order to fill their planes and maximize profits. Cheap fares are offered by airlines
when the load factor is low and the demand is low. While they increase their
prices when the load factor is high and the demand is high.

These price variations can also be applied in industries such as restaurants or

establishments with admissions or ticket fees.
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“Internal Factors to Consider when Setting

Price”
Pricing is often one of the most challenging things to get right in business such as of
the tourism and hospitality industry. There are several factors a business needs to consider
in setting a price such are:
Marketing Objectives
The marketing objectives of a business should be considered in setting the right price.
A company that has increase in return on investment as its objective may choose to price
higher. While having a bigger market share as an objective would result to changing a
lower price by the company. Pricing decisions may consider the following objectives:
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1. Survival – An organization lowers it prices in order to survive the offensive attacks of competition.
This could be a short-term strategy, although this can also be used as a long-term objective for the
purpose of having more sales but certainly lower profits. When the economy is in recession, most
hotels use this objective. Since opportunity falls, therefor room rates and profits drop.
2. Current profit maximization- Definitely, the most important objective of any business is obtaining
a lot of profit. This objective seeks to earn the greatest peso amount in profits. Most hotels apply the
following techniques to increase the amount of profit they generate.
a) Cancellation policy- hotel charge a lower rate on the condition that a guest cannot collect a
reimbursement once he cancels the room. On the other hand, higher rates can be charged when
guest are given greater flexibility with cancellation.
b) Upselling- This means that the guest may be persuaded to upgrade to a much better room or pay a
higher room rate for a desirable view he prefers. This may also refer to paying more for a king size
bed. Upselling is usually done during the booking process when guest are still making their choices in
order to be successful.
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c) Cross Selling- This is about encouraging customers to make added purchase above what has been
already made. This includes additional service, such as local tours, massages, or gym services. Most
often, cross selling is most effective once the initial booking has been completed, but prior to the
guest arrival. Hotels make use of promotional emails to attain success in cross selling.
d) Length of stay- This is making adjustment based on the span of the stay. This is making pricing
adjustment based on the span of the stay. Hotels may device a rule where guest “must” stay for a
minimum number of days without necessarily lowering the rates. This can be done when demand
outweighs supply. During times when demand is lower guest are encouraged to make longer stay in
lower rates.
e) Offering a package- When package is introduced guests may pay for more than just one room. part
of the package may also include such as meals, accessibility to golf course and equipment and others.
This way the hotel may be able to sell more products at the same time though, the actual room rate
may be lowered.
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f) Price per segment- Here, the price depends on the types of customers. Corporate segment should be
offered lower rate especially if they will book more rooms. Selling multiple rooms to travel agencies
which is another segment to be included in their tour packages is another option.
3. Market share leadership- Market share leadership is having the largest market share in a given
industry. The market share is computed by dividing the volume of goods sold by a specific company
by the total number of units in the market. In the tourism and hospitality industry, most businesses
believe that a company with the biggest market share shall enjoy low cost and high profit margin in
the long run. Hence, new hotels for instance they offer their product and services in the lowest price
possible to build market share. Such low opening rates ma create demand and brand awareness. Hen
later on increase their rates in order o increase revenue.
4. Product quality leadership- Establishments in the tourism and hospitality industry such hotels need
big investment to offer luxurious services hat calls for premium prices. Obviously, there should be a
high employee-to-guest ratio and service ought to be provided by well-trained people. The Discovery
Shores Hotel located in Boracay offers a prince/princess lifestyle with their suite and rooms that cost
Php 10,000 in average per night. The most expensive suite has a private deck paired with a Jacuzzi
while overlooking view over Boracay. While restaurants, the Certified Angus Prime Roast Beef
located in Tagaytay City cost Php 15,800 which is the most expensive meal.
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Marketing Mix Strategy

It is believed that price is an important element of the marketing mix. A change in
price surely affects the other three elements of product, place and promotion. Yet'
pricing decision is also affected by any decisions made for other elements of the
marketing mix.
There are hundreds of stories on 5-star hotels that when visited by guests are only
worth two-stars based on experiences. In making pricing decisions, product-service
quality should be considered to make travellers repeat their purchase continuously.
Typically, hotels located in a downtown receive more repeat business though priced
higher compared to hotels in remote areas. These days, most hotels communicate
their best available rates, special promotions and events using their brands websites.
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Cost
• Cost and price of a product are directly related. A company must consider
the cost involved in making the product. Cost usually includes a variable and
a fixed component. Both the variable and fixed costs should be recovered
when setting the prices. Normally, fixed costs are not affected directly by
changes in occupancy or sales volume in case of hotels. Variable costs on the
other hand are directly related to hotel occupancy and business volume.
Hence, as business volume or occupancy increases, same thing happens with
the variable costs. The reverse is true when hotel ancy decreases, the variable
costs also decrease too.
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Organization for Pricing

Pricing is often decided on two levels of the company. The over-all pricing strategy is
handled by top management particularly in small companies.
It is the top executives who commonly has complete control over pricing. Based on
market segments, these top executives regulate the basic ranges that the product falls
into.
In big companies, the marketing department headed by the marketing manager assists
the top management in deciding for the price. Once the price is determined, the
pricing policies laid down by the top executives are administered by the marketing
department. The actual system of pricing is handled by the lower levels of the
company that centers on each product strategy especially where pricing varies in
different markets. The lower level executives are also granted the opportunity to set
prices when there are several products and there is a need to make frequent pricing
decisions Often, the production department is also given the involvement in pricing
decision by some companies.
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External Factors to Consider when Setting Price

• There are also factors in the external environment of the company that
affectspricing decisions such as market demand, competition, technology,
social mediaand other environmental elements.
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Market Demand

• The market demand has a big factor in pricing decisions. Demand is affected
the number and size of competitors and the potential consumers' preference
and their capacity and willingness to pay which are all considered in setting
prices. The expected price can be tested by trying various price ranges among
different markets and then make comparison with a controlled market with a
fix price. If there would be inelastic demand, high prices can be set. While for
elastic demand, a company cannot set high prices and instead establish a
lower price than competitors.
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Competition
• Competition is a vital factor in price determination. A company needs to evaluate its degree of competition to make price adjustment
of its products and/or services. High competition entails making the price equal or lower than competitors to be effective, while low
competition demands for a higher price. Certainly, the quality of product or service offering need not suffer with the price.
• Hotels are no exception to competition. They offer travelers better price deals to attract them to try their services, but still making
profit. Revenue managers always face the challenge of competition when setting prices. With the online sphere of influence, new
opportunities have been created in attempting to lure customers. For instance, the travel review websites and online travel agencies
(OTAs) made a possible the ratings of hotels which was not done before. Companies in the tourism and hospitality industry are now
able to let their customers and prospective clients their value proposition. Nowadays, its only takes few clicks to find out the best
available rates among competition and figure out the reasons why some hotels are selling better when they are all selling on the rate.
• The hotel industry both in the country and abroad are aggressively competing among each other in terms of pricing. Today, data
analysis is progressively becoming a powerful tool for revenue managers in providing answers to problems relating to pricing.
Information from the company and the competitors can help a lot in identifying the price point to make adjustments for more
revenue generation.
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Technology and Social Media

• Amazingly, more and more travelers are progressively moving to mobile technologies. Based from
Nielsen 2012 Social Media Report, increasing time spent on mobile apps and the mobile web
contributed to 63% of the growth in the time using the Internet. Every day, a lot of consumers are
looking for new devices to be connected and on the go. These days, travelers keep posting, sharing
and writing their experiences in an instant.
• It is a great challenge for companies in the tourism and hospitality industry to advantageously
collect and use this overflowing data and information over the Internet for their organizations and
their customers.
• In the tourism and hospitality industry, social media has generated a huge influence. Most
consumers normally look for possible destinations to visit and make informed decisions on their
travels. Personal experiences. about a specific hotel restaurant or airline are shared by travelers.
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Economic Condition

• The economic condition of a particular place also affects pricing decision of

tourism and hospitality businesses. During recession, the price level normally
drops. On the contrary during boom period, price level increases to cover
the big cost of production and distribution. In the case of hotels, still people
still need to stay in hotels and travel for business. However, it is expected that
there would be reduction of travel expenditure during times of recession.
Hoteliers would lower their rates in order to attract more customers.
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Government and Politics

• In assigning prices, the laws and regulations of a particular place are considered.
Through the local governments, the government may interfere in the pricing of
companies under the tourism and hospitality industry. The Department of Tourism
may name prices for products offered by the industry. The department may assign
room prices in hotels for regular customers called board prices. Accommodation
companies need to comply to the set prices by the department. Besides, the
department may also set prices to customers who are brought by travel agencies or
tour operators known as exceptional prices.
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Pricing Components in the Industry

• Rack Rates
It is the price without yet the discounts is offered wholesalers and promoted in
brochures for the coming season. All businesses in the tourism and hospitality industry
must have a rack rate as an official rate. The full rate for activity and attraction
operations is always charge without any discounting. The price remains the same even
during peak holiday season. However, in the case of accommodation operations
especially those serving the middle class market, there is always a daily change of pricing
planned monthly or every other two months just to reach the full capacity.
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Seasonal Pricing
Businesses in the tourism and hospitality make us of mix prices throughout
the year to shoulder the low and high season. This type of pricing is standard
for the industry. Normally, the date periods are the same each year, through
may vary depending on demand. The date periods may cover the school
holidays, public holidays and or local events which the dates different each
year.
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During school holidays for instance, most families take their vacations because there is a fixed amount
of time they can spend together for fun and relaxation. Hence, there is a great demand for travel.
People certainly will pay a premium for example in the case of flights or hotels due to limited resource.
Since they really wanted to use the school holidays then shelling out of money to secure this resource is
not a problem. A higher ordering cost for those people who wanted to get the service.
During back to school season, the demand decreases when it comes to flights and hotels. Hotel offer
price reduction and some forms of incentives. These promotional sales or discounts are provided to
reduce the ordering cost for the consumer. At the same the lowered prices could attract more people.

Last Minute Pricing

The last minute pricing method is commonly used to attract accommodation suppliers and tour
operators to fill any last-minute gaps in inventory availability. Basically the pricing used here is
discounting daily prices based on forward bookings. Hence this method is promoted on last
minute booking websites.
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Discounting

competition is un avoidable in any business environment. The tourism and hospitality market is no
exemption. Discounting is a way to stimulate demand. However, this method is not always applied because it
reduces profitability and even miss the break-even point. Businesses in the tourism and hospitality industry use
this method only when there is a need for extra bookings. Sometimes, these businesses add conditions to a
discounted price such as a minimum stay or number of travelers in the booking. The danger is discounting is
that customers may become accustomed to the discounted price that it would be difficult to charge the normal
rack rate. Besides discounting de values the product on the minds of customers.

Package Deals
One way of stimulating demand without having to discount is to develop packages with complimentary
tourism partners or to add valuable components. It is nice to share the business with other local
businesses in an area. In niche markets, packaged deal is better to offer. A package deal may include food
and wine hours, beauty and relaxation, weekend golf and other similar services. Tourists enjoy meeting
their holiday need in package which may consists of hotel, airfare, transfers, tours and activities, all of
packages based on the travel preferences and budget of customers.
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Commissions
Commission is a charge that a hotel pays to third parties for selling their hotel rooms. It is
commonly a fix percentage of the room rate. The commission ranges from 10% to 30% based on
how influential the OTA is, on the size of the hotel and also on the attractiveness of the
destination.

Numerous booking may come from a third party who will charged a certain percentage of
commission. A retail travel agent, wholesaler, inbound tour operator or online travel agent (OTA)
charge commission from tourism and hospitality business. These people can open up new
markets in very cost effective way, but they also need to be paid. Commission is usually their
major source of revenue. Tourism and hospitality operators may be tempted to add the
commission of these providers to the pricing. Hence, the rack rates could be affected.
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• The level of commission varies based on who sells the product and which
distribution method is used. Here are the average commission levels payable
to third-party sellers.

Third Party Seller Average Commission

Travel Agents / Visitor Centers 10%-20%

Tour Wholesaler 25%-30%

Inbound Tour Operators 25%-30%

• Table 1: Third Party Sellers And Their Commissions

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Cost-based Pricing
It is simplest method, in order the business to be successful, both the cost and the profit needs to be
accounted for. In the cost-based method, the first thing to do is to add up the cost of running, say a
hotel. These costs include expenses for personnel salaries, maintenance, security, advertising telephone
and even taxes.
Through the approach is easy, but the list for computing the costs can be long. Fixed and variable costs
need to be taken into account in addition to the direct and indirect costs of running a business, for
instance a hotel. Some recognizable costs in managing a hotel are composed of fixed and variable
expenses.
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FIXED COSTS- are those that do not change whether there are many guest or there are many rooms that have been
rented. Examples of fixed costs or expenses are the following:
1. Mortgage
2. Taxes
3. Wages
4. Insurance
5. Utilities
6. Telephone
7. Internet

VARIABLLE COST- are those expenses that change depending on the profit earned. Normally, the more guest that are
accommodated, the higher the variable cost will be. Examples of variable cost include the following:
1. food and beverages
2. cleaning
3. entertainment
4. Sales and Marketing
5. Room Amenities such as soap, shampoo and the likes
6. flowers and decorations
7. printing supplies
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The pros and cons of the cost-based pricing in the tourism and hospitality industry which are:
PROS
1. A logical approach to pricing.
2. A simple and understandable way to
price rooms.
3. Flexible meaning cost increase, its easy
to adjust the pricing.
4. A logical approach to pricing.
CONS
1. Less competitive meaning can be easily
undercut by competition.
2. Not based on perceived value where
guest would be prepared to pay more
3. Ignores how competitors price their
rooms
4. Ignores consumer demand and the
impact price may have on demand.
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CUSTOMER-BASED PRICING
Offering the best combination of quality and good service at a reasonable price in terms of the relation between price
and perceived or estimated customer value. The more concern on the value and benefit that the product and or service
will bring to their lives.
This method of pricing is normally used when businesses are faced with increased competition or recession in order to
provide value products and services businesses in the fast food industry are good examples such as Jollibee and
McDonalds which offer value meals. Customers feel that they are getting a lot of products for a good price. However,
price reduction is not always perceived as increase value.
When customers see good reviews, attractive pictures of hotels and the desirable experiences being offered, they conclude
that the price is good deals.

PROS CONS
1. Good for high competitive markets such as the hotel 1. Can be forced into pricing was that chip away chip away at
industry. profit margin.

2. Allows a business to differentiate itself from the 2. Can be forced to lower the standards to compete in the
competition. marketplace.

3. Can draw customers to the company’s based on how it 3. May need to find new ways of attracting customers not
position itself. purely based on price.
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Pricing and Positioning

Positioning Strategy
▪ Involves the selection of the target market and the creation of the differential advantage. Price can be an
instrument to express this differential advantage and to attract a specific market segment.
▪ Pricing is a strong positioning tool since for a lot of people it serves as measure of quality. In most cases
quality cannot be assessed before consumption as the case of drinks, perfume, and services.
Skim Match Surround Undercut Penetrate
Highest P 99.00
Higher P 89.00 P 89.00 P 89.00
Equal P 79.00 P 79.00
Lower P 69.00 P 69.00 P 69.00
Lowest P 59.00
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Speed and transparency brought by the internet has significantly charged hospitality pricing. OTAS such as
Hotwire, Orbiz, and Hotels.com believe that there is no need to an industry insider to find the best price
that suits the needs and budget of travelers. Although hotels and restaurants should always make pricing
decisions. Still pricing is a challenge that simply places a business into gamble.
QUINTANILLA

SKIM

• Skimming is setting prices higher than competition does in order to "skim of"customers
who are ready to pay more. Skimming is a strategy that clearly positionsa company above
others. It tells consumers something is special that worth payingmore for about products
and/or services. For instance, look at the price of AngusPrime Roast Beef in Antonio's
which costs P15,800 per order. Antonio's which islocated in Tagaytay City offers a mix of
French, Mediterranean, American, Italiancuisine. The smell of the steaks and the prime
meat is really appetizing. Theclassiness" and a more relaxed atmosphere than those of
restaurants situated inManila are really inviting.used more carefully.This strategy can be
very lucrative. However, this shouldAlthough high prices denote high quality for many
customers, it is still importantthat they know why they had pay more to stay or eat at a
particular establishment.
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MATCH
Matching as a strategy places the pricing on par with the competition, but not
essentially for all rates. In order to match, a business needs to set one rate
similar to competitors while another rate is set slightly higher. With this type of
strategy, said business can remain competitive for a larger market of customers
without destabilizing the competition.
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SURROUND

This type of pricing strategy positions the first room type as the cheapest in the market.
However, the hotel also offers rooms with better options at a price that is closer to the
competitor’s first available rates. It is actually “surrounding” the middle market. The intention
is to capture customers that are willing to pay within the ranges. For instance, Resto A offers a
sirloin steak and lobster special at the price of Php 849.99. Resto B may offer the same menu
for Php 1,249.99 together with a filet and two side dishes. Resto B also offers a sirloin steak
for Php 449.99. This strategy allows Resto B to attract customers looking for an affordable
steak dinner. It also offers something different for those customers who have money and
willing to pay more, but at a price. Resto B’s offer is lower than that of Resto C whisteak
Php1,749.99 for smallest filet steak.
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UNDERCUT
Through the undercut strategy, a hotel can potentially attract more customers
by offering products using competitors’ rates in some categories. In order to
undercut, a hotel offers a product that is priced equivalent to competition but
another product that is lower. For instance, hotels near a major airport may
have the same star ratings and amenities but may offer different packages. For
14 days stay Hotel A may offer free parking and a room for Php 3,500 while
Hotel B for 2,500. These hotels may have the same best rate rooms but one has
preferred to undercut using an attractive package intention here is to attract
price-conscious travelers that come their way.
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PENETRATE
Pricing very low has some advantages and drawbacks. Basically, this pricing
strategy is designed to attract people in the door and in seats. For start-up
businesses low prices usually is the best way to attract consumers to consider
trying the product or service. However, this strategy can also reduce market
prices, lower margins, and set a poor example as the business grows. Certainly,
the price of a hotel or restaurant reflects how consumers value its product or
service. Most consumers though when they examine online hotel options, most
noticeable are those using penetration pricing.
SUMATRA

CHAPTER 9
Promoting Tourism and Hospitality Product“
"Learning Objectives: The learners shall be able to:
• Describe the communication process;
• Design advertisements for products and services in the tourism and hospitality industry; • Develop publicity for
products and services in the tourism and hospitality industry;
• Formulate sales promotion for products and services in the tourism and hospitality industry; and
• Integrate marketing communications for products and services in the tourism and hospitality industry.
With the use of marketing concept, the needs and wants of consumers are identified. These needs and wants are easily
communicated to the target consumers by applying different mix of promotion elements. The purpose of promotion is
to inform the consumers about products and/or services, create an image of the offerings and position said products
and/or services in the market. There are various promotion mix which business could choose from to send their
messages to inform, persuade and remind customers. Promotion mix in the tourism and hospitality industry is
composed of advertising, publicity, sales promotion and word-of-mouth which are discussed here.
SUMATRA

The Communication Process

• Communication is very important in the existence and survival of any organization.
Communication refers to the process of creating and sharing ideas, information,
views, facts, and even feelings between and among individuals to reach a shared
understanding. This process could be in the form of word-of-mouth message for
example a verbal instruction given on announcement at a meeting. Or
communication could be in the form of a written communication such as a
business letter, a memorandum, a production sheet, housekeeper’s report , or a
procedure for a menu. Communications is a continuous process which mainly
consists of various elements explain below in detail:
SUMATRA

NOISE
Noise means any obstruction that prevents the precise transmission and reception of the message during the process of
communication. Poor internet connection, erroneous encoding, unmindful receivers, poor underdtanding of message
because of prejudice or inaapropriate gestures are some examples of noise.
Basically, there are three different type of noise, namely:
1. External Noise is any interferences that comes outside of the receiver. For instance, a tourist who has try to continue a
conversation above the rumble of Pagsanjan Falls has experienced external noise.
2. Physiological Noise is disturbance initiated by a genetic factor such as the case of loss of sight or hearing.
3. Psychological Noise speaks of forces that either cause a sender to incorrectly encode a message or a receiver to
erroneously decode a message. Say for instance, a restaurant customer is fuming about receiving slow service, he may
encode his grievance to the manager such that the delay he experienced is overstated . Similarly, if the restaurant manager has
already heard more complaints in one day including this annoyed customer, he may disregard the information that the
irritated customer is trying to express.
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ADVERTISING
Advertisng, even in these modern times still remains as one pf the most prominent tools of marketing communications. Advertising
is a paid marketing tactic of non-personal presentation including paying for space to promote a product, service, or cause by an
identified sponsor. Advertisements or simply ads are the actual promotional messages in advertising. The objective of advertising is
reach customers who are willing to pay for a company’s products or services and attract them to buy.
In the tourism and hospitality industry, advertising is important to provide significant information to potential customers. For
instance, a tour could be offered to travelers using visuals of beautiful cathedrals, white water rafting, relaxing massages, and other
attractions.
Traditional advertising media such as print, television, radio, billboards and moving billboards still remains to be important
marketing media in the tourism and hospitality industry. However, entrepreneurs in this industry with lower marketing budget
should look for economical yet effective advertising using technology resources. Banner advertisements, publicity campaigns on
tourism and culture portals, mobile apps, and social media can allow a business in the industry to reach to a big segment of targeted
market.
Advertising ideas help hotels in the industry to create market distinction, stimulate relationships with former customers and appeal
to new customers. Here are some ways that businesses in this industry advertise their prpducts and serveces.
SUMATRA

BRANDING
Branding is the practice of providing a meaning to a particular organization, company, products or services through forming and
shaping a brand in consumers minds. In the tourism and hospitality industry, the effectiveness of hotel advertising could be
enhanced linking the hotel’s brand image to the message It wanted to represents. Take as an example the remarkable rise of property
giant Megaworld Corporation's hotel business. It was established 30 years ago. Since then, it became known as the country's biggest
developer of townships. The company has built 25 extensive developments in significant strategic places everywhere in the
Philippines. Under its portfolio are Richmonde Hotel, Savoy Hotel, Belmont Hotel, Twin Lakes Hotel, and Hotel Lucky Chinatown.
This hotel group business brings the reputation of giving a different prime living experiences closer to the people inspired by the
very character and uniqueness in lifestyle of the place where it is situated. Said reputation in hospitality comes from the homegrown
Filipino brand of warmth and hospitality.
In Lucky Chinatown in Binondo offers to customers the taste of the distinctive, lively ambiance of the Chinatown culture as they
delight in the sights and sounds. Likewise, in Newport City, customers who are checked-in Savoy Hotel Manila and Belmont Hotel
Manila enjoy the reputation of these hotels as a "world of entertainment" when they eat, spree, and indulge themselves an said places.
The fascinating Twin Lakes Hotel in Tagaytay, delights travelers with the scenic views of Taal Volcano. Unknown to some people this
hotel is the first and only hotel in the Philippines with a real grape- growing vinery placed at its backyard.
SUMATRA

TRAVELING ADS
Through broadcasting specials during airplane flights, some hotels are able to
advertise their products and services. Advertisements may include videotape of
room suites, event calendars and pictures of restaurant offerings. This
advertising idea can also be presented on commuter trains and cruise ships with
built-in television screens.
In the Philippines, hotels often place their ads inside the stations Light Rail
Transits (LRT) or Metro Rait Transits (MRT) uch as that of Sogo Hotel in
LRT Monumento Station.
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MULTIPLE FRONTS
Some hotels are able to attrqct hugr share of the target market through glossy magazine
advertisements. Hotels promote their suite-level rooms with copy and pictures intended for
elite costumers. While level rooms could be advertised in financial magazines but with totally
different presentation to draw the business travelers. Hotels may also create special campaigns
for families and budget-conscious travelers in local tourism guides who may opt for standard
rooms. In this manner hotels may be able to reach for a wider target market in order to keep
rooms in their full capacity.
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ADVERTISING GIMMICKS
Hotels may also huge outdoor signs as part of their advertising gimmicks. Most hotels
attracts costumers with their ads full of glossy and sophisticated images with high-quality
printing placed in the hotel building self.. Costumer loyalty are a great means to make certain
costumers come back continiously. Reward cards that function as a Visa credit cards could
also be an advertising gimmicks just like what Hyatt chain of hotels did. Holders of the
royalty cards may enjoy free night stays at any Hyatt hotel in the world. The Shangri-La
Hotels offers the Golden Circle program with three unique tiers each providing its own level
of recognition and priveleges that will make customers feel right t home. Stay at a qualifying
room rate or earn a minimum of 50 gift cheque (GC) Award Points at any Shangri-La hotel,
resort, Kerry hotel, Traders hotel and Hotel Jen. These programs work by allowing guests to
earn points and reach certain levels every year. In some bussiness in the industry , they
partner with outside agencies to indirectly advertise their establishments like hotels and
airlines using their pillows in hotels beds.
SUMATRA

WEBSITE ADVERTISING

With technology, it has been a practice that business in the industry advertise
using their own company websites like hotels. Other hotels though create
website just for the sake of advertising their compaigns.
ZAYCO

Website Advertising
With technology, it has been a practice that businesses in the industry advertise using their
own company websites like hotels. Other hotels though create website just for the sake of
advertising their campaigns.
Having a website of its own, any guest using any device can find the hotel he desire. More and
more guests are now booking their accommodations using mobiles on hotel’s websites ,
Canvas is a good example of hotel technology that can be used to advertise hotels with its
E-commerce and functional designs.
Hotel advertising on company websites has become mainstream practice, but some hotels
have begun creating website-only advertising campaigns. Some boutique hotels used
website-only ads to compete against new competitors in recent times by featuring artistic
dreamscapes of the iconic surrounding neighborhoods,
ZAYCO

Social Media Advertising

Social media advertising is an online paid advertising that focus on social
networking sites. Social networking sites include Facebook, Twitter, Instagram and
YouTube page that are able to target bigger share of the market. These days, social
networking is a powerful-hotel advertising tool. Most travelers tell their hotels
experiences whether good or bad as testimonials. This is a good opportunity for hotels to
highlight positive testimonials and address dissatisfied customers, Most hotels make use
of social networking sites to promote their offerings to thousands of people that includes
their previous, existing and prospective customers.
ZAYCO

Social media advertising has changed how many people act together with businesses in this industry
and share experiences with others, in a communication chanel known as word of mouth. In word of
mouth customers share directly their experiences with each other. These days, consumers have a
range of channels on which to articulate their likes and dislikes, lots of which have huge audiences.
Some of this comment is made in actual time, on a smartphone, while the consumer is still in the
business.
Word-of-mouth is possibly one of the most significant and most effective tools in advertising.
Obviously, there is a need provide quality services before becoming Success in word-of-mouth
promotion. Businesses should keep an eye for opinion
leaders or influencers and take care of them so that they can endorse the business’ service via word
of mouth. Instagram is a good instrument for reaching out to possible influencers for assistance.
Today the leader of online word-of-mouth is without doubt TripAdvisor.
ZAYCO

Publicity

Publicity is a strategic practice of managing communication that creates reciprocal advantages between organizations and
their publics. Building relationships with media people is an effective way of projecting a positive image of any business in
this industry. Publicity plays an important role in creating images of locations, activities and identities using print media,
word of mouth, and the attitude of the targeted audience. Regular stories and photos in newspapers, travel publications,
online in a blog or podcast, social media and broadcasts are forms of publicity that could increase inquiries, bookings and
arrivals, Most of the public these days chooses to believe in blogs instead of placing confidence on self-indulgent
advertisements.
The main objective of publicity is to form desire to travel, encourage to take acton and deliver an enjoyable experience
during the visit. In the tourism and Hospitality industry, publicity centers on travel, tourist destinations, hotels and
restaurants. Each type of business has its own specific target market that needs to be addressed using different tools which
are implemented to represent different messages. Inside the box is an example of a publicity in a form of blog based from
the testimony of a customer who had an experience with a hotel in the Philippines.
ZAYCO

Sales Promotion
Sale promotion is the process of inluencing a prospective customer to purchase the
product or service. This includes short-term activities to boost sales and good way to
gain more market share. This is seldom appropriate as a way of creating long-term
Customer loyalty. When launching a new product or service, sales promotion is very
helpful helpful.Sales promotion tools may include samples, coupons, packages,
patronage,rewards, premiums, point-of-purchase, displays, contests, sweepstakes, and
games.
In the tourism and hospitality industry, particularly in hotels, the goal is to have all
rooms filled in the whole year. Although this may seem impossible, hotels have
different tactics in bringing in more travelers at any time of the year. Here are some
way that the businesses in this industry can practice sales promotion.
 Integrated
Marketing
Communications
(IMC)
2 Examples of Successful IMC from an airline and restaurant