OSMEÑA COLLEGES

BACHELOR OF SCIENCE IN HOTEL AND RESTAURANT MANAGEMENT

THC 7
TOURISM AND HOSPITALITY MARKETING

OVERVIEW
UNIQUE CHARACTERISCTICS OF THE TOURISM INDUSTRY
Welcome to the dynamic world of hospitality and tourism marketing! Make sure you fasten your
seatbelt as you explore more about this fast-moving management function.
We are in the information age. There is no doubt. With the growing importance of technology,
marketing techniques are evolving at a fast pace. In each sector, the best practices have its own
characteristics, and in order to understand it, you need to look at industries separately. Marketing
i n T o u r i s m has become a vital subject for all enterprises in the travel business, and
today we introduce you to the term of Tourism Marketing.

EXPECTANCY
After exploring this module, you must be able to:
1. Differentiate tourism product from consumer products.
2. Identify the different characteristics of tourism industry products.
3. Distinguish high involvement from low involvement products.

LEARNING ACTIVITY
Marketing for tourism covers several level, from the tourism destination as the product itself,
down to the specific tourism products and services that a tourist should avail to complete the
tourist experience.
What is tourism actually selling then? Tourism is not a single product. It is a combination of the
products and services which results in a holistic experience for the traveller.
Unlike consumer products which can be availed off the shelf, tourism products have unique
characteristics that make their marketing and promotion quite challenging. The tourism product is
intangible, inseparable, variable, perishable, seasonal, and substitutable. Additionally tourism is a
high involvement product.
The following are the Unique Characteristics of tourism Industry;
Intangible
Tourism product cannot be touched, smelled, tasted, felt nor heard prior to purchase. They cannot
be subject to prior scrutiny. A destination that promises fresh air from its beaches or a scenic
view of the mountain cannot send a sample. Consumers rely on photographs of the place,
comments or reviews from those who have visited the place or availed of the services, and
promises from the company itself.

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The beauty of the scene can only be appreciated when one is actually in the destination. Looking
in the photographs will never equate to the experience of having’s hair blown by the wind. This
is why the word of mouth is highly effective of means of promoting tourist destinations.
Inseparable
The tourism product cannot be separated from the consumer. When tourists avail of products and
services, they have to personally go to where the products are. Since what is being sold is the
experience, the product and the consumer cannot be in the two different places; they have to be in
the same place. Example, A tourist who avails of airline tickets need to be physically present
inside the airplane to avail the product. Activities within the destination can only be enjoyed
when one is a part of it. Products cannot be delivered to where the consumer is. Most of the
time it is the consumer who goes to where the product is to avail of the product. (You are part
of the product)
Variable
The tourism experience is likely to be different depending on when the product is availed, who
one is with, and how the service providers deliver the service at the time of consumption. Let us
take this example, One may have gone to the same restaurant several times and have a different
dining experience each time. While the first time at the restaurant may have been quite, the
second time, one finds it to noisy. Hence the variability of the tourism product.
This is the primary reason why standardization of the operations is crucial in the tourism industry.
Chain and franchise establishments make it appoint to standardize the way they provide products
and services to address the variability component of the industry.
Perishable
The tourism product is one of the most highly perishable of products. Perishability, as used in
this context, refers to not being able to forward inventory to the next day. It does not refer to
food being spoiled and thrown away. Products become perishable when it can no longer be
consumed today even when no one consumed it the day before. Unlike consumer products such
as a pen; if the pen was not sold today, it can still be stored in a warehouse to be available for the
sae the next day.
Airline and restaurant seats, hotel rooms, and function rooms are perishable products. A seat or a
room that is not sold today cannot be sold some other day. For instance, a hotel with 100 rooms
that was half full yesterday will only have 100 rooms today. The 50 rooms that were occupied the
day before cannot be sold the following day; the hotel fails to earn from the unsold rooms. A
hotel always have the same number of rooms for sale at any given day.
Revenue management addresses the perishability factor of the tourism product. With the proper
tools for forecasting price and occupancy, yield can be maximized.
Seasonal
Seasonality does not only refer to seasons of the year or the weather conditions. It also refers to
behavioural patterns of the travel market. The seasonality of the tourism product hinders it from
maximizing its profits all year round. Hence, intensified marketing during the lean season will
help increase demand for the product. This is also the reason most tourism product, such as
airlines and resort, have different rates throughout the year. Such difference in rates help manage
capacity and yield to maximize profit.
Substitutable
Competition in the tourism industry is intensifying. With new destinations emerging and
competing in the global marketplace, one destination can easily be substituted for another
destination. It is quite challenge to establish loyalty among clients since there is a wide range of
product offerings to choice from.
Marketing necessarily plays an important role in the purchase of tourism products. Because of
the aforementioned characteristics of the tourism product, a marketing strategy needs to be
developed to make the product competitive in a highly commercialized market place.
Tourism as a High Involvement Product
Decision making in the purchase of tourism product is considered to be high involvement.
Tourism products of high involvement mean that there is a greater degree of thought or study
involved prior to the purchase. Expensive, complex and unrepeatable are characteristics of
high involvement products.
Purchase of expensive products is likely to go through a long and detailed process of canvassing
and comparing of brands, supplier, and product features. If the product commands a high price
worth more than one’s month salary, one would surely make detailed comparisons before
finalizing any purchase. Travel products, home appliances, and real estate properties fall under
this attribute.
Consumer may find complex products difficult to purchase. The difficulty may arise from the
need to understand the feature or details of the product. Travel packages can be considered as
complex mainly due to the variety of products and services available.
The unrepeatable nature of travel makes it a “once-in-a-lifetime” purchase. With the novelty-
seeking behaviour of most tourist and the high cost of travel, travel purchases may not be
repeated or may be infrequent. Hence, more carefully scrutiny is exercised prior to purchase.
Aside from travel products, special events such as weddings, and debuts fall under this
characteristics.
Unlike low involvement products which are inexpensive, simple, and familiar, more detailed
scrutiny of alternatives, longer time for deliberation, and high expectations for satisfaction happen
when consumers avail of tourism products and services that are of high involvement.
 Marketing plays a vital role in the purchase of high involvement products. It leads consumers to
think about the products and its features as well as to assure them of its quality. It helps clarify
doubts and lessen risks involved in the purchase of the products. Since tourism products and
services are high involvement products, customers also demand a high level of satisfaction.

CHECKPOINT
After exploring this module you must answer the following:
1. Differentiate tourism product from consumer product. Given the choices below, write your
answer in the space provided.
 Airlines
 Laptop
 Cellular phones
 Cruise ship
 Computers
 Hotels
 Inns
 Restaurants
 Amusement Park
 Museum
 Marine sanctuary
 Furniture
 Traveling bag
 Resorts
 Dress

Tourism Product Consumer Product

2. True or False. Write TRUE if the statement is correct and FALSE if the statement is incorrect.
1) Perishability in tourism product are products that can be stored for future
sales.
2) Tourism products are tangible, you can evaluate them before purchasing the
product.
3) The (WMO) or word of mouth information is of great importance in the
hospitality and travel industry.
4) Customers are more involved in the production process of service.
5) Competition is a dynamic process in the industry.
6) Standardization is the way to address the variability component of the
tourism industry.
7) Tourism products are promoted most aggressively when there is a peak
demand.
8) Most hospitality and travel services are easy to copy.
9) The shelf life of tourism products are only one day or less.
10) Services are inseparable from the individuals who provide them.

3. List down the 3 High involvement and 3 low involvement products characteristics.
High Involvement vs. Low Involvement

HOMEWORK
1. How would you define marketing? Write down your idea on what you think is involved
and compare them in the next module.
 2. What are the Core Principles of Marketing?
-

REFERENCES
Books
Maricel Gatchailian-Badilla, 2015 edition, “Tourism Marketing”, HRM-Tourism Series.
Kotler, Philip, Bowens, John T., and Makens, James C.2010. “Marketing for Hospitality
and Tourism”. 5th edition.
Lumsdom, Les. 1997. “Tourism Marketing”, International Thomson Business Press.
Oxford UK.
Alastair M. Morrison, “Marketing for the Hospitality and Travel Industry”, Philippine
Edition, ©2010 Delmar, a part of Cengage Learning First Philippine reprint 2010.
Prepared By:

MARJOLYN O. TIPON-TIPON
Instructor

Approved by:

MANUEL R. ANG
Program Head
 OVERVIEW
MARKETING DEFINED

Why is marketing such a hot topic in today’s hospitality and tourism industry? Why do
companies spend millions each year on marketing? In this module you will learn the importance
of adopting a marketing orientation in today’s highly-charged marketplace.
You will become familiar with the core principles of marketing. The benefits of marketing are
identified so you will understand why it’s becoming so important in today’s hospitality and
tourism industry. So let’s get going!
EXPECTANCES
After exploring this module, you must be able to;
1. Define the Core Principles of Marketing.
2. Define what a market is;

LEARNING ACTIVITY
If you are like the most people unfamiliar with marketing, you probably listed such thing as the
Internet, advertising or commercials, selling, and sales promotions (.eg., coupons, in-store
displays). As soon you will realise, these aspects of marketing are only the tip of the iceberg.
Even more marketing works goes behind the scenes.
This module definition is based on the following six marketing fundamentals;
1. Satisfaction of customers’ needs and wants. The primary focus of marketing is satisfying
customers’ needs (gaps between what customers have and what they would like to have)
and customers’ wants (needs of customer which are aware.)
2. Continues nature of marketing. Marketing is a continuous management activity, not a
one- time set of decisions.
3. Sequential steps in marketing. Effective marketing is a process of following a set of
sequential steps.
4. Key role of marketing research. Using marketing research to anticipate and identify
customer needs and wants is essential for effective marketing.
5. Interdependence of hospitality and travel organizations. There are many opportunities for
partnerships in marketing among organizations in our industry.
6. Organization-wide and multi-department effort. Marketing is not the sole responsibility of
one department or division. To be most effective, it requires the effort of all departments
or divisions.
When you combine these six marketing fundamentals, the following definition of marketing
emerges:
 “Marketing is a continuous, sequential process through which management in the hospitality
and tourism industry, plans, researches, implements, controls, and evaluates activities
designed to satisfy both customers’ needs and wants and their own organization’s objectives.
To be most effective, marketing requires the efforts of everyone in an organization and can
be made more or less effective by the actions of complementary organizations.
You may have noticed in this definition that the five management tasks in marketing are
planning, research, implementation, control, and evaluation. What do you notice about these
five words when arranged in this order? Give yourself a pat on the back if you saw that their
first letters spell out the word PRICE. The PRICE of marketing is that all organizations must
do;
THE PRICE OF MARKETING
P Planning
R Research
I Implementation
C Control
E Evaluation

Marketing Orientation
Being marketing oriented is essential in today’s competitive environment. It will also be a great
help to you in your career! So what does it involve? Marketing Orientation means acceptance and
adoption of marketing concept- customers’ needs are first priority. Marketing-oriented
organizations and managers always have a long-term perspective.
The benefits of having a marketing orientation;
 Changes in customer needs and characteristics are known.
 Cooperation among an organization’s departments increases.
 Cooperation with complementary organizations increases.
 Customers are more satisfied.
 Departments, managers, and staff share a common goal.
 Effective marketing programs are repeated or enhanced; ineffective ones are dropped.
 Marketing expenditures and human resources are used most effectively.
 More marketing opportunities are realized.
 Services, products, and promotions match the customer’s image of the organization.
 Strengths are accentuated and weaknesses addressed.
 Viability of new services and products are identified.
Core Principles of Marketing
Now you are ready to hear about the seven core principles of marketing that will be so important
to your career. Shown in this figure;
 The Marketing
Concept

Satisfying
Customer Needs and wants

Marketing Mix

Marketing
Orientation

Product Life Market

CycleM Segmentation

Value and the

Exchange Process

1. Marketing Orientation. Having a marketing orientation implies that the manager or

organization has accepted the marketing concept and acts according to it.
2. Marketing Concept. When hospitality and tourism managers adopt the marketing concept,
it means they believe that satisfying customers’ needs and wants is first priority. They
constantly put themselves in their customers’ shoes, and ask, “How would I react if I
were one of our customers?” they continually force themselves to put resources and
effort toward satisfying customer needs and wants.
3. Satisfying Customers’ Needs and Wants. To ensure long-term survival in today’s
competitive business environment, all hospitality and travel organizations must realize
that the key to their existence is the ongoing satisfaction of customers’ needs and wants.
They must always be alert for new opportunities to convert customers’ needs and wants.
4. Market segmentation. All customers are not alike. Experts have come up with the term
market segmentation to describe this concept. It is better to pick out specific groups
people- or target markets- and market them only. Some call this the “rifle approach,” as
compared with the “shotgun approach.” Hospitality and tourism marketers can’t
afford wasted buckshot, because marketing dollars and resources are limited. They
must take aim at specific target markets to ensure the highest returns.
5. Value and the Exchange Process. Value and value for money are terms often used in
today’s business and in our daily lives. Although easy to say, these terms are hard to
define. Value represents a mental estimate that customers make of hospitality or tourism
services ability to satisfy their needs and wants. Some customers equate closely with
price; others do not. Price is not only indicator of value. Marketing is an exchange
process. Suppliers of hospitality and tourism services trade items of the value of the
customer. The industry provides services and experiences that customers find value
when they are away from home. In return customers make reservations and pay money,
which satisfies the industry’s financial objectives.

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 6. Product Life Cycle. The product life cycle idea suggest all hospitality and tourism services
pass through four predictable stages: 1.) Introduction, 2) Growth, 3.) Maturity, and 4.)
Decline. Marketing approaches need to be modified with each stage. Avoiding a decline
is the key to long term survival.
7. Marketing Mix. Every organization has a marketing mix. It includes the marketing
strategy factors (the Ps of Marketing) that are used to satisfy the needs of specific
customer groups. Traditionally, four such factors are identified. They are product,
place, promotion, and price- the 4 Ps. This module add another 4 Ps that are especially
important in hospitality and travel marketing people: People, Packaging, Programing,
and Partnership.
Traditional 4 Ps of Marketing Additional 4 Ps of Hospitality
and Tourism Marketing
Product People
Place Packaging
Promotion Programming
Place Partnership

Definition of a Market
A Market is a set of actual and potential buyers of a product. These buyers share a particular need
or want that can be satisfied through exchange relationship. (Kotler er al. 2010). The meaning of
the term market has evolved over the year. To marketing professionals, a market is all actual and
potential buyers of a product of a product or service (Kotler et al. 2010).
Service Marketing is a concept based on the recognition of the uniqueness of all services. It is a
branch of marketing that specifically applies to the service industries.
Why is service marketing different?
The marketing of hospitality and tourism services has several unique characteristics. Some are
shared with all service organization (Generic differences). Others exist because of the ways in
which service organizations are managed and regulated (contextual differences). Generic
differences affect all organizations in the service industries and will never be eliminated.
Contextual differences are also unique to service organizations, but they may eventually
disappear through changes in management, laws and government regulations. Generic
differences are common to all service organization. Contextual differences vary by of service
organization. There are six generic and six contextual differences that can be shown in Figure
2.1

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 OSMEÑA COLLEGES
BACHELOR OF SCIENCE IN HOTEL AND RESTAURANT MANAGEMENT
THC 7
TOURISM AND HOSPITALITY MARKETING

Generic Differences Contextual Differences Tourism and Hospitality

 Intangibility
 Product methods
 Perishability
 Distribution
channels
 Cost determination
 Relationships of
service providers
Differences
 Narrow definition of  Shorter exposure to
marketing services
 Lack of appreciation  More emotional
of marketing skills buying appeals
 Different  Greater importance
organizational on managing
structures experience clues
 Lack of data on  Greater emphasis on
competitive stature and imagery
performance  More variety and
 Impact of government types of distribution
regulation and channels
deregulation  More dependence on
 Constraints and complementary
opportunities for non- organizations
profit marketers  Easier copying of
services
 More emphasis on
off-peak promotions

There is a growing recognition that services marketing is a separate and distinct branch of
marketing. This is based on the belief that unique marketing approaches are required in the
services industries, of which hospitality and travel are just one element. Services share common
features that make them quite different from products. Services are intangible, highly
perishable, inseparable from providers, and difficult to cost. They have different production
process and distribution channels.
Marketing in the services industry has evolved at a slower pace than it has in the manufacturing
and packed-goods industry, and in several instances has been influenced by government
regulation. Service managers and executives have been more reluctant to adopt the core principles
of marketing.
The tourism and hospitality industry is, above all, a people industry. Those organizations that
have climbed to the top are known for their high concern for both customers and employee
satisfaction.
 CHECKPOINT
After you have read and explored this module you must be able to answer the following question:
1.) Why is it important to understand and adopt the seven core principles of marketing?
-

2.) Based on the information given in this module, what are the different types of markets?
And why it is important to understand each type?
 OSMEÑA COLLEGES
BACHELOR OF SCIENCE IN HOTEL AND RESTAURANT MANAGEMENT
THC 7
TOURISM AND HOSPITALITY MARKETING

HOMEWORK
1.) Identify the different characteristics of a market segment

2.) Enumerate the different types of Market

REFERENCES
Books
Maricel Gatchailian-Badilla, 2015 edition, “Tourism Marketing”, HRM-Tourism Series.
Kotler, Philip, Bowens, John T., and Makens, James C.2010. “Marketing for Hospitality
and Tourism”. 5th edition.
Lumsdom, Les. 1997. “Tourism Marketing”, International Thomson Business Press.
Oxford UK.
Alastair M. Morrison, “Marketing for the Hospitality and Travel Industry”, Philippine
Edition, ©2010 Delmar, a part of Cengage Learning First Philippine reprint 2010.

Prepared By:

MARJOLYN O. TIPON-TIPON
Instructor
 OSMEÑA COLLEGES
BACHELOR OF SCIENCE IN HOTEL AND RESTAURANT MANAGEMENT
THC 7
TOURISM AND HOSPITALITY MARKETING

Approved by:

MANUEL R. ANG
Program Head
 OVERVIEW
To be an effective marketing manager, you need to understand the big picture. You have to
visualize the broad scope of the industry and be aware of the many different organization within
it. Now that you know what marketing is, you are probably anxious to learn the steps involved.
Market segmentation, targeting, and positioning are key terms useful in any marketing process.
Identifying one’s market segments will help in identifying the market’s need and wants. How
their needs should be met and how to communicate such to benefit them is covered in this
module. Market coverage strategies and identifying one’s unique selling proposition and
competitive advantage will greatly contribute to a successful marketing plan.
EXPECTANCES
After exploring this module, you must be able to;
1. Identify the three steps to target marketing.
2. Name the Variables to segment Consumer Markets.
LEARNING ACTIVITY
The tourism product is not for all. The tourism industry aims to target a specific set of
individuals. It is for a particular set of buyers, a niche market. There are three steps to target
marketing; 1) Market segmentation, 2) Market targeting, and 3) Market positioning.
Market Segmentation
A market is comprised of varied profiles and characteristics that can be furthers segregated.
Imagine the market as an entire pizza that can be divided into several pieces or an orange fruit
with several segments. Each slice or segment has different characteristics from the others.
These segments differ in their wants or desires, socio-economic status, age travel behaviour, etc.
Market segmentation is dividing the market into distinct groups who might require separate
products and/or marketing mixes (Kotler et al. 2010). A market segment is a subgroup of the
total consumer market who share similar characteristics and needs relevant to the purchase of a
product, service, or experience (Hsu 2008). Each segment is profiled based on its characteristics.
Characteristics of a Market Segment
Lumsdon (1997) identified the six characteristics of a segment, as follows;
1. Identifiable. The people who comprise the segment can be located and identified such
that targeting them would be easy.
2. Cohesive. The consumers should be part of a whole whose specific qualities are common
to all.
3. Measurable. The marketer should be able to estimate the size and potential spending of
the members of the market segment.
4. Accessible. The members of the segment should be accessed by marketing efforts and
promotional activities to be conducted. If they are difficult to reach, efforts to reach out to
the specific segment might be futile.
5. Substantial. Segments should be large in order to be substantial. If the segment is small,
it should have a high spending capability to make significant impact on business’ bottom
line.
6. Actionable. The company has enough resources and commitment to enable effective
penetration of the identified segment to ensure effective positioning.
There is no one way of segmenting market. Different variables for market segmentations can
be used to find out which one is the most effective. These variables used in segmenting
consumer markets include geographic, demographic, psychographic, and behavioural.
Variables for Segmentation
Geographic
Geographic segmentation divides the market into different geographic units such as nations,
states, regions, countries, cities, neighbourhoods’, barangays, towns, etc. Some companies
make a decision to strengthen a foothold on a certain geographic location.
Demographic
Demographic segmentation refers to segmenting the market based on variables such as age,
life cycle, gender, income, occupation, education, religion, and race. It is good idea to
segment the market based on demographic variables because consumers would have similar
likes and possible consumption patterns and behaviour. Some popular ways tourism
marketers segment the market using demographic variables are though age and life cycle,
gender, and income.
Psychographic
Psychographic segmentation divides consumers based on different psychographic profiles
such as social class, lifestyle, and personality characteristics. Different social classes will have
different tastes and preferences on what they buy.
Lifestyle has influence on what and how consumers buy products and services. Restaurants
and bars tap different markets based on lifestyle. Personality is seen as an indicator of the
type of products people buy. Products take on an image or a personality (outgoing,
private, adventurous, etc.) and people also have personality traits. Study have shown that
consumers tend to buy products that reflect a personality similar to themselves.
Behavioural
Behavioural segmentation refers to dividing groups based on their knowledge, attitude, use of
or response to a product or service. Kotler et al. (2010) identify behaviour variables to include
special occasion segmentation, benefits sought, user status, user rate, loyalty status, and buyer
readiness.
Special occasion segmentation involves purchase made based on occasions such as Mothers’
Day, Valentine’s Day, Honeymoon, anniversary, or birthday. Buyers may also be grouped
according to benefits they seek such as quality, ambiance, menu variety, and price. User
status refers to markets segmented based on usage of product such as first time users,
regular users, non-users, potential users, etc. Usage rate, on the other hand, refers to
frequency of use categorized as light, medium, and heavy users. Loyalty status
segmentations refers to the degree by which customers are loyal to the brand. Some buyers
just go for the cheapest or most convenient while others stick to a brand unconditionally.
Buyer readiness pertains to the different stages buyers become ready to purchase a
product. These stages range from being unaware, slightly aware, want to buy, and intend to
buy.
Behavioural segmentation is a good starting point for creating a communication campaign to
target specific segments that would seem variable for the company.
Technographic
Cooper (2006) suggest that there is a fifth variable for market segmentation to which he calls
technographic segment. With prevalence of the internet and the World Wide Web, there is an
increasing divide between the users and non-users of technology in searching for travel
information. The more technological savvy one is, the more information he gets from the
Internet. Hence, travel websites and lifestyle travel portals will allow customers to customize
their travel needs.
Market Targeting
Market segmentation show the various market segment opportunities available for a
company. A careful assessment of these specific market segments will help the firm identify
which ones it should target. Market targeting is evaluating each segment’s attractiveness and
selecting one or more of these market segments in which to operate one’s business. (Kotler
et. Al. 2010).
Kotler suggest three factors to consider in evaluating which segments should be targeted.
These factors are;
1) Segment size- refers to the current sales volume, growth rate, and high profit margin.
2) Attractiveness- refers to the potential impact of the segment to the company. One that
is not saturated and has few aggressive competitors would be structurally attractive.
3) Company objectives and availability of resources- refer to the main reasons for
decision making and the available resources the company will use to make its
objectives a reality.
Market Positioning
Market positioning is developing competitive positioning for the product and an appropriate
marketing mix (Kotler et al. 2010)
Positioning has everything to do with the deliberate way by which marketers would want to
position their product in the consciousness of its prospective customers. Its goal is to identify the
product’s unique characteristics in a way that will differentiate in the marketplace. These
positioning concepts will help reinforce the idea of market position: 1) unique selling proposition,
2) competitive advantage, and 3) top of mind.
Unique selling position (USP) is a term used to identify what makes the product or service
different from others. This USP may occur due to the product’s physical attributes, added
services, personnel, location, or image (Kotler et al. 2010).
Competitive advantages is the product’s advantages over competitors, which is gained by offering
greater value either by offering lower prices or providing more benefits to justify higher prices
(Kotler et al. 2010)
Top of mind is the highest level of recall that a brand receives. It means that the brand occupies
the top spot in a consumer’s mind. The ultimate top of mind level a brand can reach is when it
becomes synonymous to generics. For example, Xerox is actually a brand of photocopying. We
would use the term, “pa-xerox” when we actually mean “pa-photocopy.” Market positioning is
a deliberate way of making sure that the product has a high recall in the consumer’s mind
relative to its competitors.
Some positioning strategies include the following:
 Specific product attributes such as a price and special features can be used to position a
product.
 The product can also be positioned based on its benefits and the needs to product fills.
 Positioning the product based on certain classes or segments of users (e.g, women or
children as primary users) can also be done.
 A company can decide to position itself against an existing competitor and present its
edge over said competitor.
Types of Market
Emerging markets can also be segmented using demographic and psychographic variables. Some
of the Philippines’ emerging markets include the family market, the senior market, the youth
market, MICE (Meetings, Incentives, Conference, and Events) and business market, among
others.
The Family Market
There are three types of vacation decision makers within the family market: 1) Joint decision-
making families, 2) husband making the decision, and 3) wife making decision.
In a study conducted by Nicholas and Sneper (1988) on family decision making and tourism
behaviours and attitudes, they made the following conclusions:
Joint decision-making families plan trips which the longest period of time and make use of the
widest range of information sources. This type of families participates in a lot of leisure activities.
Thus, promotional materials should be made available early, dispersed in a variety of media
sources, and designed for spouses of the same age.
Families where the husband makes the decision for the vacation destination is characterized by
spouses with greater age differences. Promotional activities are directed to male spouse; hence
should emphasize outdoor recreation. Husband-dominant families spend the largest amount of
money on their vacations.
Wife-dominant families form the smallest segment of the family market. If the wife makes the
decision on vacations, it is characterized by short planning duration and uses the fewest
information sources for planning. This type of families spends the least amount of money and
shortest duration compared to joint decision-making and husband-dominant families.
Aside from segmenting the family market using decision makers as a standard, using the concept
of the family life cycle (FLC) is another way. The family life cycle refers to the progressive stages
through which individuals and families proceed over time. Travel behaviour changes depending
on the family’s stage in the life cycle mainly due to time and budgetary constraints in raising a
family.
The Senior Market
The senior market is also known as the silver market or third-age tourism. There was even
campaign know as SKI which encourages the elderly to go on vacations to Spend Kid’s
Inheritance. There is clearly a high level of demand for travel within the senior market. They
have the time, money, and desire to travel. They look at retirement as an opportunity for
personal development and improvement. There are assumptions that the senior market is
healthier, wealthier, and more active than previous generations of the same age.
However, the senior market also had limitations and constraints to engage in travel. These factors
include safety and security, health issues, availability, costs, family responsibilities, poor
information about suitable options, and previous experience. The senior market in the Philippines
can be characterized into two: those with retirement benefits, and who rely on their children for
sustenance. With the increasing costs of health care and medicines in the Philippines and the
meagre social security provisions provided to senior citizens, the Philippine silver market is a
niche market.
The Youth Market
Researches has shown that long-distance youth travellers are primarily experience-seekers,
collecting unique experiences that will serve to build their self-identify narratives. There is a
growth of travel participation among the youth market that is fuelled by several factors,
enumerated as follows:
1) Increased participation in higher education
2) Increased travel budgets (parental contribution, savings, and work)
3) Work and travel combinations
4) The rise of low-cost/budget airlines
5) Shorter employment contracts leading to significant gaps in employment
6) The global rise of the internet culture
7) Growth of independent travel guidebooks
Backpacking, which used to be western habits, has been acquired by countries such as China,
India, and Korea. The students market of Koreans is a major market of the Philippines. Some
schools have considerable percentage of Koreans. Youth study exchange programs, internships,
and voluntary work have also encouraged parents to send their children abroad.
The MICE Market and Business Tourism
The Meetings, Incentives, Conference (Conventions), and Exhibitions (MICE) industry is
extensively and rapidly growing. Collectively known as the events industry, this type of travel is
concerned but not limited to business travel. These sectors have differences but also have
overlaps that make it convenient to put them together as one growing segment of the tourism
industry. All of these events need a conglomeration of products and services such as
transportation, accommodations, food and beverage, banquet facilities, entertainment, and
shopping.
Conference tourism refers to all activities associated with planning, travel to and participation in
conferences and meetings, both domestic and international. Incentive travel is the most lucrative
of the MICE market. Incentive travel comes in the form of a reward for employees or business
partners; hence, luxury is a natural consequence.
Importance elements in venue selection for the MICE market were itemized as follows: cost,
location and accessibility, time and duration of conference, technical requirements, size of
conference, configuration of the room, destination image, and leisure opportunities. For
destinations and establishments targeting the MICE market, they should continue to improve their
services, facilities and the design of their venue, be abreast of information technology
developments, and maintain competitive destinations that offer value for money.

Page | 20
 CHECKPOINT
After you have read and explored this module you must be able to answer the following question:
Essay Rubrics:

FOCUS
The single controlling
point made with an
awareness of task about a
specific topic.
Sharp, distinct Apparent point made No apparent point Minimal evidence of
controlling point about a single topic but evidence of a a topic.
made about a single with evident specific topic.
topic with evident awareness of task.
awareness of task

5 4 3 2 1

CONTENT
Substantial, specific, Sufficiently developed Limited content with Superficial and or
The presence of ideas and/or illustrative content with adequate inadequate minimal content
developed through facts, content elaboration or elaboration or
examples, anecdotes, demonstrating explanation. explanation.
details, opinion, statistics, strong development
reasons and explanations. and sophisticated
ideas.
5 4 3 2 1
ORGANIZATION
Sophisticated Functional Confused or Minimal control of
The order developed and arrangement of arrangement or inconsistent content arrangement
sustained within and across contents with content that sustains a arrangement of
paragraphs using evident and or subtle logical order with content with or
transitional devices and transitions some evidence of without attempts at
including introduction and transitions. transition.
conclusion.
5 4 3 2 1
STYLE Precise, illustrative Genetic use of a Limited word choice Minimal variety in
use of a variety of variety of words and and control of word choice and
The choice use and words and sentence sentence structures sentence structures minimal control of
arrangement of words and structure to create that may or may not that inhibit voice and sentence structures.
sentence structures that consistent writer’s create writers voice tone.
create tone and voice. voice and tone and tone appropriate
appropriate to to audience
audience.
5 4 3 2 1
CONVENTIONS
Evident control of Sufficient control of Limited control of Minimal control of
Grammar, mechanics, grammar, grammar, mechanics, grammar, grammar,
spelling, usage and mechanics, spelling, spelling, usage and mechanics, spelling, mechanics, spelling,
sentence formation. usage and sentence sentence formation usage and sentence usage and sentence
formation formation formation
5 4 3 2 1

Page | 21
1.) Discuss the three steps to target marketing;
2.) Given the choices below, Classify each Variables to Segment Consumer Markets.

Nations Educations User status Benefits sought

Age Barangays Loyalty status Cities
States Religion Buyer readiness Lifestyle
Life cycle Towns Neighbourhoods Income
Regions Race Usage rate Personality
Gender Social Class Occupation Personality
Countries Special Occasions
 OSMEÑA COLLEGES
BACHELOR OF SCIENCE IN HOTEL AND RESTAURANT MANAGEMENT
THC 7
TOURISM AND HOSPITALITY MARKETING

Geographic Demographic

Psychographic Behavioural

HOMEWORK
1.) What is Consumer Behaviour?
 OSMEÑA COLLEGES
BACHELOR OF SCIENCE IN HOTEL AND RESTAURANT MANAGEMENT
THC 7
TOURISM AND HOSPITALITY MARKETING
2.) What are the factors that influence consumer behaviour?
 REFERENCES
Books
Maricel Gatchailian-Badilla, 2015 edition, “Tourism Marketing”, HRM-Tourism Series.
Kotler, Philip, Bowens, John T., and Makens, James C.2010. “Marketing for Hospitality
and Tourism”. 5th edition.
Lumsdom, Les. 1997. “Tourism Marketing”, International Thomson Business Press.
Oxford UK.
Alastair M. Morrison, “Marketing for the Hospitality and Travel Industry”, Philippine
Edition, ©2010 Delmar, a part of Cengage Learning First Philippine reprint 2010.

Prepared By:

MARJOLYN O. TIPON-TIPON
Instructor

Approved by:

MANUEL R. ANG
Program Head
 OSMEÑA COLLEGES
BACHELOR OF SCIENCE IN HOTEL AND RESTAURANT MANAGEMENT
THC 7
TOURISM AND HOSPITALITY MARKETING

OVERVIEW

TOURISM AND CONSUMER BEHAVIOUR

Why do costumers behave the way they do? This is a question everyone in marketing must
answer. If we can understand customers’ behavior, we are much better position to customize
services, prices, promotions, and distribution channels to fit their individual needs and wants.

This module explains that people’s behavior is influenced. All customers go through a series of
stages when they decide to buy hospitality and tourism services. This chapter emphasizes that
marketers need to understand the decision processes that customers use.

EXPECTANCES

After exploring this module, you must be able to;

1. Identify the factors that influence consumer-behaviors;

2. Discuss the stages of the buyer decision making process, and
3. Differentiate individual versus organizational buyer behavior

LEARNING ACTIVITY

Consumer behavior is the process and activities people engage in when searching for, selecting,
purchasing, using, evaluating, and disposing products and services to satisfy their needs and
desires (Belch & Belch 2008). Purchase decisions especially for tourism products are usually
arrived at after a long and detailed process of information search, brand comparisons, and
evaluation. Tourism products are too expensive to be bought on impulse. Thus, a careful
examination of choices is made before an actual purchase happens. We will learn in this chapter
that there are many factors that influence consumer behavior, and purchase is often not just
attributed to the price of the product.

Factors that influence Consumer Behavior

Tourism marketing scholars identify key factors that have an influence over consumer behavior,
as follows; 1) motivations, 2) culture, 3) age and gender, 4) social class, 5) life-style, 7) reference
groups, and 8) personality and self-concept.
 Personality
and Self- concept

Reference
Motivations
Groups

Life Cycle Buyer Culture

Factors Influencing Tourist

Consumer Behavior
Age and Source: Adapted from Hudson
Lifestyle
Gender
(2008)
Social
Class

Motivations are inner drives that make people take a specific plan of action to satisfy their needs.
Hudson (2008) defines needs as the gap between what customers have and what they would like
to have; seen as the force that arouse motivations. A person who has the ability to understand
how motivation works will have the ability to gain competitive advantage. If one is able to
identify what triggers purchase, he can actually create the scenario to influence the purchase.

Maslow’s Hierarchy of Self-acualization

needs is the most popular
theory of motivation as if is Esteem/status Belongingness safety
able to outline the different Physiological
needs of man, and rank them
based on degree of
importance in a simple and
easy to understand manner.

Physiological needs refer to basic needs for survival such as need for food and water. Safety
refers to personal and perceived degree of safety and security. Belongingness refers to
acceptance in social groups. Esteem/status refers to desire for prestige and status. Self-
actualization refers to the goal of self-fulfillment. Maslow ranked them based on their level of
importance.

Culture The impact of culture cannot be disregarded in the study of consumer behavior.
Researchers have looked into how culture has affected consumer behavior. Social scientist geert
Hofstede explain how culture impacts the global marketing arena through his research work. The
cultural framework of Hofstede can be used to explain the differences in consumer behavior
across countries, and can be guide in increasing efficciency in global marketing. He discloses
the five dimensions of cultures, as follows: 1) power distance, 2)
individualism/collectivism, 3)
masculinity, 4) uncertainty avoidance, and 5) long-term and short-term orientation. A sixth
dimension was recently added, that is, indulgence versus restraint.

Hofstede defines culture as the collective mental programming of the human mind which
distinguishes one group of people from another. This kind of programming influences patterns of
thinking which are reflected in the meaning people attach to various aspects of life and which
become crystallized in the institutions of a society.

Age and Gender Age pertains to the number of years a person living. Age is a traditional way of
segmenting the market and also greatly influences consumer behavior. Likes and preferences of
consumers are normally dependent on their ages. Travel packages are normally tailor-fit
depending on the generation of the target market. Gender on the other hand, also
influences consumer behavior. The female marker is steadily increasing and has observed to
be more discriminating than its male counterparts. The gay market also being seen by
marketers as having a set of preferences different from the male and female markets.

Social Class The socio-economic status of individuals is still being considered as one of the most
important external factors influencing consumer bevahior (Hudson 2008). Social class is one’s
position within the society and is determined by factors such as income, wealth, education,
occupation, family prestige, and value of home or neighborhood (Kotler et al. 2010).

Lifestyle Is a person’s pattern of living as expressed in one’s activities, interests, and opinions. It
portrays the whole person interacting with external forces. Lifestyle are by no means universal
since it also interacts with culture, economic situation, and personality. Marketers are in search of
relationships between their products and people’s lifestyle.

Life Cycle The family life cycle model (Pearce 1993) suggest that travel patterns and destinations
differ as people move on through the life cycle. Life cycle refers to the stages an individual goes
through in their lifetime. Single people choose destinations that have fun and adventure more than
those who are married and have young children. Being married and with four-year-old son, our
choice of destination have shifted to places with theme parks, child-friendly accomodations, and
familiar food choices. Preferences and activities of the other stages of the life cycle may vary;
thus, influencing consumer and purchase behavior.

Reference Groups Are known to be a set o people who have a direct or indirect influence on
other people’s attitudes or behavior. Those people can be a member of your family, a
teacher or a classmate in schools, as boss or a colleague in your workplace, or your priest or
pastor in the church. This also been exteded to other experienced travelers and food experts
through their blogs. We do not personally know them but are viewed as highly credible
because of their experience
and expertise. Reference groups are extremely important in selling tourism product because
product is intangible; hence, word of mouth plays an important trigger for purchase decisions.

Personality and Self-concept Personality refers to distinguishing psychological characteristics

that lead to relatively consistent and enduring responses to the environment. This has great
influence over one’s buying behavior. A consumr’s self-concept refers to his personal mental
picture. Consumers tend to go for product brands that reflect their personality. People who are
friendly and outgoing would likely be found in restaurants that project a friendly and outgoing
image. Intovert people would likely meet up with a friend in quaint restaurants, and not in bars or
club.

Personay and self-concept may affect an individual’s choice of recreational activities while on
tour. It also affects the choices of accomodations and restaurants that people choose when they
travel.

The buyer decision-making process.

In module 1, we discussed how tourism products fall under high involvement products. In high
involvement products, stages in the buyer decision-making process are more defined and could
easily be identified. Decision making is made after a thorough evaluation of alternatives because
the products are expensive, complex, and possibly unrepeatable.

Need recognition Needs are triggered either by internal or external stimuli. For exampke, on your
way home, you felt hungryas your stomach grumbled. You see a restaurant and grabbed a quick
bite. This was triggere by internal stimuli. Let’s take this another example, on your way home,
you smell the aroma of freshly cooked bread as you passed by the bakeshop. It smelled really
good so you decided to enter and buy a piece of bread. The purchase was triggered by
external stimuli. Promotional strategies are creativelydeveloped to make people think that they
need our products. Successful business owners those that have thought to satisfy a need even
before consumers have articulated such need.

Information Search Once a consumer recognizes a specific need, he may or may not be prompted
to search for more information. The eagerness for more information will depend on the strenght
of the desire, information that person may already have, and the satisfaction he may get
from additional information he gains. Crotts (2002) classidies information into two internal and
external information. Internal information search is nothing more than retrieving decision-
relevant information stored in an individual’s long-term memory. These may be caused by low
involvement stimuli such as exposure to ads or by prior experience with the destination that is
not available to first time visitors. External information search focuses on acquiring information
from outside or external sources. These may come in the following forms; 1) personal (advise
from friends) 2)
marketer dominated (brochures and ads), 3) neutral (travel clubs and agents), 4) experimental
sources, and 5) the Internet.

Evaluation of Alternatives This stage allows peospective customers to make detailed comparisons
of different product or service providers since they already have sufficient information. Based on
resources which are availbale to them at the time of purchase. Resources may include time,
money, brand image, availability of flights, and conveniece of makeng the purchse. For example
you are planning a trip to Ingapore, you will have to compare the airfare costs of several airlines
such as Cubu Pacific, Philippine Airlines, Air Asia, and Jet Star. You will also consider the
schedule of flights because if you want to maximize your trip, you should prefer to leave
Manila in a early morning.

Purchase Decision This is the stage most awaited by tourism marketers. This is when consumers
actually make the purchase decision. At this stage, marketers should facilitate the speed and
convenience by which the products or services reach the consumers. Distribution networks should
be made available and access to the products easy and fast.

Post-purchase Evaluation It is extreely important for product and service providers to encure that
customers have a good experience with the product. This will facilitate positive word of mouth.
Customer satisfaction can have different degrees, as follows: extreemely satisfied, satisfied,
neutral, dissatisfied, and extremely dissaisfied. Kotler (2000) defines satisfaction as a person’s
feelings of pleasure or dissapoinment resulting from comparing a product’s perceived
performance in relation to his expectations. In tourism, it is generally known that high quality
service would result in tourist satisfaction, creating positive word of mouth leading to repeat
visits.

Organizational Buyer Behavior

The organizational buying process is more formal version of the consumer buying process
discussed earlier in this module. Organizations are more complex because more people are
involved in the decision-making process, and there is greater demand for a variety of products
and services. Organizations buy in bulk for group consumption while consumers usually
purchase in retail for personal consumption. Organizational buyers commonly respond to both
economic and personal factors. Major influences or purchase would include cost and economic
outlook, organization’s objectves and personal agenda, interpersonal factors ate play between
buyers and sellers, and personal motivations, perceptions, and preferences. Kotler et al. (2010)
describe the process as follows;

a) Problem recognition
b) General need specification
c) Product specification
 d) Supplier search
e) Proposal solicitation
f) Supplier selection
g) Order routine specification
h) Performance review

Understanding how individual customers and organizational buyer behave is a prerequisite for
effective marketing. Customers place more weight on the reccommendations they receive from
their friends and associates that ther do on the information supplied by hospitality and tourism
organizations. Word-of-mouth information is therefore, apowerful force in our industry.

Customers go through different stages in making purchase decisions. The actual stages followed,
and the sequence of these stages, avry according to the amount of the purchase and the perceived
degree of difference between alternative. To be successful, marketers must understand their
customers’ decission process.

CHECKPOINT

After you have read and explored this module you must be able to answer the following question:

1.) What are the factors that influence consumer behaviour? Why it is important for an
organization to understand the behaviour of its costumers?

Page | 30
Page | 30
2.) Discuss the stages of the buyer decission-making process use one tourism product as an
example.

3.) Differentiate individual buyer behaviour from organizational buyer behaviour.

Page | 31
INDIVIDUAL BUYER BEHAVIOUR ORGANIZATIONAL BUYER BEHAVIOUR

Page | 32
 HOMEWORK

1.) After completing this module, make an advance study about “Tourism Marketing and the
Communication Process”.
2.) List down some barriers to communication.

REFERENCES
Books
Maricel Gatchailian-Badilla, 2015 edition, “Tourism Marketing”, HRM-Tourism Series.
Kotler, Philip, Bowens, John T., and Makens, James C.2010. “Marketing for Hospitality
and Tourism”. 5th edition.
Alastair M. Morrison, “Marketing for the Hospitality and Travel Industry”, Philippine
Edition, ©2010 Delmar, a part of Cengage Learning First Philippine reprint 2010.
Belch, George E., and Belch, Michael A. 2008. Advertising and Promotion: An
Integrated Marketing Communications Perspective, 8th edition. NY: McGraw-Hill.
Hudson, Simon. 2008. Tourism and Hospitality Marketing: A Global Perspective.
London: SAGE.

Prepared By:

MARJOLYN O. TIPON-TIPON
Instructor

Approved by:

MANUEL R. ANG
Program Head