1

Understanding the

HTT 668: Marketing Communications for Travel and Tourism

Communications Theory
and Applications

Dr. Mohd Hafiz Hanafiah, CHIA

Associate Professor
Department of Tourism Management
Faculty of Hotel and Tourism Management
Universiti Teknologi MARA Malaysia
Learning Objectives 2

HTT 668: Marketing Communications for Travel and Tourism

At the end of this chapter, you will be able to
 Understand the common variables of the communication mix
 Understand the links between marketing planning and
effective targeted marketing communications.
 Define the segmentation, targeting and positioning process
 Evaluate competing approaches to segmentation of tourism
and hospitality consumers.
 Relate the STP to tourism and hospitality services marketing
mix.
 Describe the relationships between STP and marketing
communications strategies.
Introduction 3

HTT 668: Marketing Communications for Travel and Tourism

 This chapter describes a range of theory approaches to
understanding communications
 Discusses how knowledge about communications is
applied to tourism and hospitality marketing
communications strategies.
 The discussion then moves on to a consideration of the
role of semiotics in the representations of tourism and
hospitality services.
 In Chapter 1, it was noted that these two services relied
heavily on representations because of the experiential
nature of the consumption of these services.
Introduction 4

HTT 668: Marketing Communications for Travel and Tourism

 Organisations need to inform consumers about what to
expect from the company in terms of the more tangible
features of the service or destination
 They also often try to communicate something about
the ways in which consumers will feel about their
consumption of the service or place.
 The links between the types of information and modes of
exchange of information is critical to understanding how
communications work in different ways on audiences.
2.1 The marketing mix in 5
communications

HTT 668: Marketing Communications for Travel and Tourism

 There are multiple components of a communications
mix.
 The communications mix in marketing comprises of the
various ways that a company can communicate with its
customers.
 Because marketing communications is of utmost
importance in today’s day and age, the
communications mix and the marketing vehicles used
within it are also important to marketing.
2.1 The marketing mix in 6
communications

HTT 668: Marketing Communications for Travel and Tourism

 As can be seen from the concepts of marketing there
were initially various different concepts which were used
when manufacturing first started.
 They were the production concept, the sales concept
etc..
 However, slowly but surely we moved on to implement
the marketing concept and today we generally use the
customer concept in the market.
2.1 The marketing mix in 7
communications

HTT 668: Marketing Communications for Travel and Tourism

 The key principle behind the marketing concept is that
we should add value to our products
 So the customer will automatically buy our products
above that of competition.
 However, how will the customer know that we have
value added products?
 This is the job of the Marcomm department and hence
the communications mix is needed.
2.1 The marketing mix in 8
communications

HTT 668: Marketing Communications for Travel and Tourism

 Generally when a company makes a marketing
communications plan, it combines multiple forms of
communication channels into the mix.
 This is done to ensure that the message of the company
reaches the end consumer.
 It is also done to ensure repetition so that the customer
recalls the brand because of the brand message being
repeated in multiple channels at once.
2.1 The marketing mix in 9
communications

HTT 668: Marketing Communications for Travel and Tourism

The 6 most common
variables of the
communication mix
2.1 The marketing mix in 10
communications

HTT 668: Marketing Communications for Travel and Tourism

#1 Advertising
 We are very well with the impact that advertising has on our
purchase behavior.
 Advertising may be in many forms but the two most common
forms are ATL advertising which includes television, radio and
print and the other type is BTL advertising which majorly
includes out of home advertising.
 Advertising is strongly used by brands who have deep pockets
or who have a lot of competitors in the market.
 The more unique and impactful the message, the more is the
connect between the brand which is advertising and the
consumers.
2.1 The marketing mix in 11
communications

HTT 668: Marketing Communications for Travel and Tourism

#2 Personal selling
 Personal selling is the second most common method to
communicate the benefits of your products to the end
customer and convert him from a lead to a prospect and
ultimately to your customer.
 This is the reason that many top companies and even small
businesses nowadays are focused on personal selling.
 The reason that the company appoints their own brand
promoter is because this ensures that the customer will have
better attention from their individual brand.
 Along with this, the company’s salesman will also have more
knowledge of product and competition as he has been
dedicatedly hired by the brand.
2.1 The marketing mix in 12
communications

HTT 668: Marketing Communications for Travel and Tourism

#3 Sales promotion
 There are many different ways of running sales promotions
and many different tips and tactics present depending on the
sector you are in.
 Where trade discounts and freebies work very well in FMCG, in
consumer durables, free services and value addition (free
installation) works better then discounts.
 Sales promotion also involves providing the consumer with an
incentive for the purchase of the product.
 At the same time, it may involve giving incentives to dealers
or distributors to get the product selling & moving in the
market.
2.1 The marketing mix in 13
communications

HTT 668: Marketing Communications for Travel and Tourism

#4 Public relations
 Public relations is the art of spreading the news about
your products or services in the public domain so that
some hype is created and people talk to each other
about it.
 In today’s date, social media is one of the biggest
platforms for public relations exercise. You will see a lot
of news being published with regards to what is trending.
 It helps in building a strong brand image and a brand
can slowly release the information therefore keeping the
public attention intact.
2.1 The marketing mix in 14
communications

HTT 668: Marketing Communications for Travel and Tourism

#5 Direct marketing / Internet marketing
 Digital marketing was giving tough competition to television
advertising as well as newspaper advertising.
 The benefit of digital advertising is that even small businesses
can get involved and it is not as costly as Television
advertising.
 Not only small businesses, even top brands take part in digital
marketing because it helps the brand in reaching the end
consumer.
 The brand which really does good campaigns can actually
walk away with a large population of digital followers.
2.1 The marketing mix in 15
communications

HTT 668: Marketing Communications for Travel and Tourism

#6 Packaging
 Due to competition and the increasing rivalry between
businesses, even packaging is considered as an important
medium of communicating with your consumers.
 The packaging of the product is the last point of sales for the
company.
 When the consumer is standing in a retail aisle, he or she has a
plethora of products in front of them to choose from.
 Many a times, the decision is made looking at the overall
packaging of the product as well as the information written
on the product.
2.2 Market segmentation, targeting and 16
positioning

HTT 668: Marketing Communications for Travel and Tourism

Segmentation, targeting, and positioning
together comprise a three stage process.
 (1) determine which kinds of customers
exist,
 (2) select which ones we are best off
trying to serve
 (3) implement our segmentation by
optimizing our products/services for that
segment and communicating that we
have made the choice to distinguish
ourselves that way.
2.2 Market segmentation, targeting and 17
positioning

HTT 668: Marketing Communications for Travel and Tourism

 Segmentation involves finding out what kinds of
consumers with different needs exist.
 In the tourism market, for example, some consumers
demand service quality, while others are much more
concerned about transportation and safety.
 In general, it holds true that “You can’t be all things to all
people,” and experience has demonstrated that firms
that specialize in meeting the needs of one group of
consumers over another tend to be more profitable.
2.2 Market segmentation, targeting and 18
positioning

HTT 668: Marketing Communications for Travel and Tourism

There are three approaches to marketing.
 In the undifferentiated strategy, all consumers are treated as
the same, with firms not making any specific efforts to satisfy
particular groups.
 This may work when the product is a standard one where one
competitor really can’t offer much that another one can’t.
Usually, this is the case only for commodities.
 In the concentrated strategy, one firm chooses to focus on
one of several segments that exist while leaving other
segments to competitors.
 For example, Malaysia Airlines focuses on price sensitive
consumers who will forego meals and assigned seating for low
prices.
2.2 Market segmentation, targeting and 19
positioning

HTT 668: Marketing Communications for Travel and Tourism

As for the third, most airlines follow the differentiated
strategy
 They offer high priced tickets to those who are inflexible
in that they cannot tell in advance when they need to
fly and find it impractical to stay over a Saturday.
 These travelers—usually business travelers—pay high
fares but can only fill the planes up partially.
 The same airlines then sell some of the remaining seats to
more price sensitive customers who can buy two weeks
in advance and stay over.
2.2 Market segmentation, targeting and 20
positioning

HTT 668: Marketing Communications for Travel and Tourism

 Segmentation calls for some tough choices.
 There may be a large number of variables that can be
used to differentiate consumers of a given product
category
 Yet, in practice, it becomes impossibly cumbersome to
work with more than a few at a time.
 Thus, we need to determine which variables will be most
useful in distinguishing different groups of consumers.
2.2 Market segmentation, targeting and 21
positioning

HTT 668: Marketing Communications for Travel and Tourism

Several different kinds of variables can be used for segmentation.
 Demographic variables essentially refer to personal statistics such as
income, gender, education, location (rural vs. urban, East vs. West),
ethnicity, and family size.
 Some consumers want to be seen as similar to others, while a
different segment wants to stand apart from the crowd.
 Another basis for segmentation is behavior. Some consumers are
“brand loyal”—i.e., they tend to stick with their preferred brands
even when a competing one is on sale.
 One can also segment on benefits sought, essentially bypassing
demographic explanatory variables. E.g. some consumers use
toothpaste primarily to promote oral health, while another segment
is more interested in breath freshening.
2.2 Market segmentation, targeting and 22
positioning

HTT 668: Marketing Communications for Travel and Tourism

The list below refers to what’s needed to evaluate the potential and
commercial attractiveness of each segment.
 Criteria Size: The market must be large enough to justify segmenting.
If the market is small, it may make it smaller.
 Difference: Measurable differences must exist between segments.
 Money: Anticipated profits must exceed the costs of additional
marketing plans and other changes.
 Accessible: Each segment must be accessible to your team and the
segment must be able to receive your marketing messages
 Focus on different benefits: Different segments must need different
benefits.
2.2 Market segmentation, targeting and 23
positioning

HTT 668: Marketing Communications for Travel and Tourism

 Positioning involves implementing our
targeting.
 For example, Apple Computer has
chosen to position itself as a maker of
user-friendly computers.
 Thus, Apple has done a lot through its
advertising to promote itself, through
its unintimidating icons, as a
computer for “non-geeks.”
2.2 Market segmentation, targeting and 24
positioning

HTT 668: Marketing Communications for Travel and Tourism

Michael Treacy and Fred Wiersema suggested in their 1993 book The
Discipline of Market Leaders that most successful firms fall into one of
three categories:
 Operationally excellent firms, which maintain a strong competitive
advantage by maintaining exceptional efficiency, thus enabling
the firm to provide reliable service to the customer at a significantly
lower cost than those of less well organized and well run competitors
(Ibis Hotel).
 Customer intimate firms, which excel in serving the specific needs of
the individual customer well (Marriot Group).
 Technologically excellent firms, which produce the most advanced
products currently available with the latest technology, constantly
maintaining leadership in innovation (Apple).
2.3 Organizational Strategy 25
Formulation

HTT 668: Marketing Communications for Travel and Tourism

 Strategy Formulation is an analytical process of selection
of the best suitable course of action to meet the
organizational objectives and vision.
 It is one of the steps of the strategic management
process.
 The strategic plan allows an organization to examine its
resources, provides a financial plan and establishes the
most appropriate action plan for increasing profits.
 It is examined through SWOT analysis. SWOT is an
acronym for strength, weakness, opportunity and threat.
 26

2.3

HTT 668: Marketing Communications for Travel and Tourism

Organizational
Strategy
Formulation
THE STEPS OF STRATEGY FORMULATION
INCLUDE THE FOLLOWING:
2.3 Organizational Strategy 27
Formulation

HTT 668: Marketing Communications for Travel and Tourism

 Establishing Organizational Objectives: This involves establishing long-term goals
of an organization. Strategic decisions can be taken once the organizational
objectives are determined.
 Analysis of Organizational Environment: This involves SWOT analysis, meaning
identifying the company’s strengths and weaknesses and keeping vigilance
over competitors’ actions to understand opportunities and threats.
 Forming quantitative goals: Defining targets so as to meet the company’s short-
term and long-term objectives. Example, 30% increase in revenue this year of a
company.
 Objectives in context with divisional plans: This involves setting up targets for
every department so that they work in coherence with the organization as a
whole.
 Performance Analysis: This is done to estimate the degree of variation between
the actual and the standard performance of an organization.
 Selection of Strategy: This is the final step of strategy formulation. It involves
evaluation of the alternatives and selection of the best strategy amongst them
to be the strategy of the organization.
2.3 Organizational Strategy Formulation 28

HTT 668: Marketing Communications for Travel and Tourism

There are three levels of strategy formulation used in an
organization
 Corporate level strategy: This level outlines what you
want to achieve: growth, stability, acquisition or
retrenchment. It focuses on what business you are
going to enter the market.
 Business level strategy: This level answers the question
of how you are going to compete. It plays a role in
those organization which have smaller units of business
and each is considered as the strategic business unit
(SBU).
 Functional level strategy: This level concentrates on
how an organization is going to grow. It defines daily
actions including allocation of resources to deliver
corporate and business level strategies.
2.4 Marketing Orientation 29

Business orientations are classified into the following groups: Production

HTT 668: Marketing Communications for Travel and Tourism

Orientation, Product Orientation, Sales Orientation, and Market
Orientation.
 Production Orientation - Dominated the business landscapes of the
industrial revolution and mid-1900’s; this is where a company is
heavily focused on streamlining production processes and
concentrating on improving efficiencies with little focus on anything
else. Scenario: We can build a car for you, but it comes in black
only.
 Product Orientation – An approach to business that centres its
activities on continually improving and refining its products. All
efforts are put into making the product better. Scenario: We can
offer you non-chip paint on your car.
 Sales Orientation – Some businesses see their main problem as not
selling enough of the product or services which they already have
available, hence predominantly focusing on sales and selling
techniques. As a result, these organisations operate as Sales
Oriented companies.
2.4 Marketing Orientation 30

 Market orientation is a culture rather than an individual

HTT 668: Marketing Communications for Travel and Tourism

process. It’s the norms, mindsets, values and behaviours of
employers; alongside the structure, systems and control of the
organisation.
 Marketing oriented businesses define their activities as service
activities carried out towards the satisfaction of their
customers.
 In other words, they define their operation as a service
business with customer service being the most important
activity. Scenario: We’ll make your trip itineraries based on
your choice.
 A marketing orientated approach means a business reacts to
what customers want.
 The decisions taken are based on information about
customers’ needs and wants, rather than what the business
thinks is right for the customer.
2.4 Marketing Orientation 31

Most successful businesses take a market-orientated

HTT 668: Marketing Communications for Travel and Tourism

approach. What does it achieve?
 A sense of what customers want
 Links customers needs to company capabilities
 Builds relationships
 Creates vision
 Greater internal marketing and communications
 Tracking and information systems for further research and
evaluation
 32
2.4 Marketing Orientation

HTT 668: Marketing Communications for Travel and Tourism

• A production orientation can manifest itself in two
ways: through a cost focus or production
capability focus.
• There are diverse models of business delivery in
tourism industry
• In the dynamic business environment, a marketing
orientation is not a unified approach for all the
organisations in the sector.
• Low-cost airlines and some chain hotels, for
example, have adopted cost-focused
orientations.
• The field of contract catering has conventionally
applied a production-focused business model.
Summary 33

 This chapter has outlined the key principles underpinning the

HTT 668: Marketing Communications for Travel and Tourism

STP process.
 It has defined the bases for segmenting the market and
shown how segmentation is linked to the marketing
communications strategy through the services marketing mix
for tourism and hospitality.
 It argued that although demographic segmentation,
psychographic and behavioural approaches were most
suited as segmentation methods
 Organisational strategy is one of the steps of the strategic
management process
 Most successful businesses take a market-orientated
approach
Group Projects 34

HTT 668: Marketing Communications for Travel and Tourism

 Describe the main steps in the STP process.
 How does the segmentation process relate to other tasks in
the marketing planning and strategy development process
for tourism and hospitality?
 Why is it important to segment the market for tourism and
hospitality services?
 Def ne what is meant by marketing orientation and discuss
how this applies to a tourism and hospitality organisation of
our choice.
 What is the relationship between generic organisational
strategy and marketing strategy?
 Explain how marketing strategy is constrained by an
organisation’s strategic choices.
 Thank you
35

HTT 668: Marketing Communications for Travel and Tourism