FACTORS THAT INFLUENCES PEOPLE OF CHOOSE BACKPACKERS RATHER

THAN TRAVEL AGENCY

AZAM TRAVEL AND TOURS SDN BHD

HAFAWATI MAISURAH BINTI ZOLKEFLI

2014105131

BACHELOR IN BUSINESS ADMINISTRATION (HONS)

MARKETING

FACULTY OF BUSINESS MANAGEMENT

UNIVERSITI TEKNOLOGI MARA

JOHOR

ADVISOR: MADAM HAIRIANI ABDUL HAMID

SEPTEMBER 2017
TABLE OF CONTENT
CHAPTER ONE : INTRODUCTION PAGE
1.0 Introduction 1
1.1 Background of The Study 1
1.2 Background of The Company 2
1.3 Nature of business 3
1.4 Swot Analysis 4
1.5 Problem Statement 5
1.6 Research Objective 6
1.7 Research Question 6
1.8 Scope of study 6
1.9 Significance of study 7
2.0 Limitation of Study 7
CHAPTER TWO : LITERATURE REVIEW
2.1 Introduction 8
2.2 Marketing Mix Affecting Accommodation Service Buying Decisions
of Backpacker Tourist Traveling 8
2.3 Understanding Relationship between Personality Types,
Marketing-mix Factors, and Purchasing Decision 8
CHAPTER 3 : RESEARCH METHODOLOGY
3.1 Introduction 9
3.2 Research Design 9
3.3 Sources of Information 9
3.3 Data Collection Method 10
3.4 List of Interviewees 11
3.5 Interview Protocol 11
3.6 List of Interview Questions 11
CHAPTER 4 :
3.1 Introduction 12
3.2 Finding Analysis 12
CHAPTER 5 :
5.1 Introduction 13
5.2 Gap Analysis 14
5.2.1 Summary of Gap Analysis 17-26
5.3 Conclusion 27
5.4 Recommendation 28
REFERENCES
 CHAPTER 1

INTRODUCTION

1.1 Background of Study

Backpacking is an independent traveller that is a form of low cost of expenditure. The expenses
are including the use of a backpack that is easily carried, the use public transport and
accommodation. This submarket is characterized by budget consciousness and a flexible
tourism style, with most participants travelling alone (Regina Scheyvens, 2002). Backpackers
can easily plan their own schedule in term of management of time and place to visit.
Backpackers have a high tendency to travel more places rather than using travel agency
services. As compare to use travel agency services, they need to follow the entire schedule that
had been arranged by the travel agent.

In travel agency management, effective marketing mix is very important as it play the role to
make the company image at the eyes of the world. Besides, it also is a strategy to make sure
that their services can be smoothly delivered to customer.

In this study, the researcher wants to find out what are the factors that influences why people
choose backpackers rather than travel agency. An effective marketing mix can help the
company to enhance their performance as well as increasing their sales and profits.

1
1.2 Background of the Company

Azam Travel and Tours Sdn Bhd is a travel agency that is owned by Muslim Bumiputera. The
Director is Dato Capt. Prof Mohd Zahrin Bin Hashim, 52 years old. This travel agency opened
on 2013.

i. Location
F18 & 19, KM plaza, 1st Floor,
Jalan Tuanku Munawir,
Seremban, Negeri Sembilan.

ii. Vision
To be the market leader in the travel industry by introducing innovative ideas and approach
while providing customer oriented travel services with value added cost effective travel
solutions to ensure ultimate client benefit and satisfaction.

iii. Mission
To provide outstanding and personalized services to all our clients globally. We always
strive to turn every vacation of our valuable clients in to fond memories that will be cherished
by them for a long time.

2
1.2.1 Nature of Business

Azam Travel and Tours Sdn Bhd provide package holiday or ticket according to the
customer request. The holiday or ticket is supplied to Azam Travel at a discount. The
profit is therefore the difference between the advertised price which the customer pays
and the discounted price at which it is supplied to the agent, which called a commission.
Azam Travel and Tours also offers various services such as inbound and outbound
tours, domestic and international ticketing, cruises, visa services, scuba diving course
and others adventure activities. This travel agency had been collaborated with others
agency such as Ministry of Tourism, International Air Transport Association (IATA),
airlines and others. Other services are the sale of in house insurance, travel guide
books, and public transport timetables, car rentals, and others services.

3
1.3 SWOT Analysis

STRENGHT WEAKNESSES

1. Travel agency conduct a good 1. Less promotional activites.

management ( internal and external )
2. The strategic location which is at the
center of Seremban Town.
3. Travel agency are able to handle
various customer’s needs.
2. Less of materials for marketing
actitivies ( Flyers, brochure )
3. Management flow of money.

OPPORTUNITIES THREATS

1. Expert staff. 1. Competitors among travel agency in

2. Travel agency that owned by malay,
Bumiputera so that can easily attract
people.
3. Travel agency that provide various
services to their customers.
Seremban. ( Mewah Travel, Traveller
Holiday and others )
2. People nowadays can manage their
vacation by their own.

4
1.4 Problem Statement

Backpacker is a person that spends at least one night in either backpacker or hostel
accommodation. Backpackers are in a small number but significant section of the overall
tourism market. They take longer trips as it was planning by their own. Backpackers are
generally characterized by their independent style and extensive range of travel and their
ability to extend their length of stay through budgeting concept. Backpackers are the tourists
who travel by searching for the information, arranging time schedule and making decision
about the traveling program by themselves. The main purposes of being the backpackers
are for economical budget and enjoying the local lifestyle.

Backpacking scenario had been seen nowadays as they are planning their own schedule to
the targeted places. They handle all the management including the hotel, the transportation,
the place to visit and others. They are choosing backpackers because of they can easily
choose budget accommodation, meet with locals and other travellers and flexible travel
schedule.

And thus, it can be seen that people are more comfortable to handling their own vacation as
it give a big benefits to them rather than used the services from the travel agency. There are
a few factors that may influences people of choosing backpackers rather than travel agency
which is about the price, place and promotion.

Issue that can be seen in this travel agency is the sales and profit of Azam Travel and Tours
Sdn Bhd had be decrease year by year as the Director said, that nowadays people can
easily purchase their airlines ticket themselves and also plan their own trip schedule without
need to used travel agency services as intermediaries. Plus, if they are using travel agency
services, for sure there will be an extra charges incurred. Not that, the people needs to
follow all the rules and condition along the trip such as the level of services, the place and
the price.

5
1.5 Research Objective

Based on the research, there are two objectives that the researcher wants to achieve as below:

RO1: To explore what are the factors that influences people to choose backpackers rather than
travel agency.

RO2: To understand characteristic of the effective marketing mix for Azam Travel and Tours
Sdn Bhd to increase performances.

1.6 Research Question

Based on the research, there are two questions that need to be answer as below:

RQ1: What are the factors that influence people to choose backpackers rather than travel
agency?

RQ2: What are the characteristic of the effective marketing mix for Azam Travel and Tours Sdn
Bhd to increase its performance?

1.7 Scope of Study

This research will explore the factors that influence people to choose backpackers rather than
travel agency that may result in decreasing the sale of the travel agency. Thus, the researcher
will used qualitative method, interview and secondary data to collect the data. This research will
be conducted at Seremban area from 7 August 2017 until 24 November 2017 which is 16
weeks.
 6

1.8 Significance of Study

1.8.1 to the organization

This study can be as reference to help this travel agency to improve their performance in
term of marketing mix that needs to be implementing in their business operation.

1.8.2 to the Researcher

By conducting this research, the researcher have learnt and being expose with the real
working environment that needs to entertain customers and resolving customer’s
problems. Besides, the researcher also gaining lots of knowledge while conducting this
study, as the researcher learnt on how to deliver message with a good communication
skills, collect the data and analyze it.

1.9 Limitation of Study

1.9.1 Time Constraints

Researcher has to manage the time to complete this research and also to work as a practical
student. Time management need to be handling properly by the researcher as the researcher
need to balance the time to conducting the research paper, interview session and industrial
training within 16 weeks period.

1.9.2 Lack of experience

The researcher has never conduct this kind of research before. And thus, the researcher needs
to refer with previous research document in order to complete this research.
 7

CHAPTER 2

LITERATURE REVIEW

2.1 Introduction

Literature review refers to previous study, report and research as database or source of
information regarding specific topics. Literature review seeks to describe summaries, evaluate,
or integrate the content of previous report. The importance of literature review is to identify gaps
in the literature, review other people work in the same field in also to continue what is left in
previous research.

2.2 Marketing Mix Affecting Accommodation Service Buying Decisions of Backpacker

Tourist Traveling

According to Nonthaporn Krichkumchon, (2008), studied the decision to stay of foreign tourists
in Patong Municipality, Kathu, Phuket. The results were that marketing mix factors affecting the
decision to stay of foreign tourists in the accommodation were7 P's which is product, price,
place, promotion, personal, physical evidence and process. These 7P are external factors
encouraging the purchase of and services.

2.3 Understanding Relationship between Marketing-mix Factors, and Purchasing

Decision

In marketing management, marketing mix is the most fundamental concept that must be
understood in order to make an effective marketing strategy. In previous researches, it is stated
that marketing mix factors such as product, price, place and promotion have significant impact
to purchasing decisions, ( Andotra & Pooja, 2007) and ( Lembang, 2010). The customer’s
evaluation of marketing mix factors is considered as evaluation process that will influence
purchasing decision, ( Kötler, 1995).
 8

CHAPTER 3

RESEARCH METHODOLOGY

3.1 Introduction

This chapter will explain the methodology of the research. The main purpose is to
explore what are the factors that influence people to choose backpackers rather than
travel agency. The people who had experienced of being backpackers were chosen to
help in providing the data.

3.2 Research Design

The researcher had choose to do qualitative study which is an interview session will be
held among three people who had experienced backpacking. This interview will be
conducted during the internship period.

3.3 Sources of information

3.3.1 Primary Data
Primary data is data that are originated by a researcher for the specific purpose
of addressing the problem at hand. The data is a new and can be collect from
various sources such as interview, questionnaire or survey. The researcher will
use qualitative data which is obtained through the interview.

3.3.2 Secondary Data

Secondary data are the data that are ready available for purpose other than problem in a
hand. It can be obtain from the journals. In this research, the researcher will used the
journals for secondary data method as the data is inexpensive and easy to access.
 9

3.3.3 Internal Data

Internal data refer to the information from the company itself that may help in conducting
this research. It can be obtain from the staff in the company.

3.3 Data Collection Method

3.3.1 Interview
In this study, the researcher will conduct the interviews session with the selected
person, which the respondent are the people who like to travel by backpackers.
 10

3.4 List of interviewees

BI NAME OF POSITION COMPANY WORKING

L RESPONDENT EXPERIENCE
1 Nur Syafika Binti Azmi Tour & Ticketing Azam Travel & Tours 4 years
Sdn Bhd
2 Nur Amirah Binti Ahmad Business Online Drc Toys 5 years
Jafri
3 Farah Farhana Binti Accountant Econsave Cash & 5 years
Amin carry Sdn Bhd
4 Fathiah Binti Osman Marketing Exec El Zahraa 3 years
5 Cazerenth A/P Dugon Business Onine Mary Kay Cosmetics 5 years

3.5 Interview Protocol

Personal interview had been conducted between the researcher and the respondent
which are being selected based on their experience and interest in backpacking. The
interview session will be recorded.

3.6 List of Interview Question

Question 1: What is real backpacking means?

Question 2: Based on your experience, why did you choose backpacking?

Question 3: Did you prefer to travel inbound or outbound place?

Question 4: In your opinion, what are the different between travel agency and
backpacking in term of price?

Question 5: Which one either travel agency and backpacking that offer flexible itinerary?
 11

CHAPTER 4

FINDING AND ANALYSIS

1. Introduction

On this chapter, the data analyses are presented. The data were collected by interview session
and observation during 4 months period of industrial training. All the data will be recorded and
then been analysed.

2. Finding analysis

Research Objective 1: To explore what are the factors that influences people to choose
backpackers rather than travel agency.

2.1 What is real backpacking means?

From the first respondent ( Nur Syafika Binti Azmi ) statements, backpacking is someone who is
willing to travel by himself or in a small group by making arrangement by their own. It is for sure
to make sure that the expenses are lower. In addition, backpacking usually involved teenagers.
The second respondent (Nur Amirah Binti Ahmad Jafri ) said that, backpacking is a form of cut
cost, independent travel, the use of public transport and inexpensive lodging such as hotel.
They preferred a longer duration of the trip. The third respondent, ( Farah Farhana Binti Amin ),
backpacking is a form of independent travel. This activity is for low cost traveller where usually
they travel for a long period and distances. The real backpacking is when a backpacker take
challenge where they just go whatever they want with minimal planning. In fact, sometimes they
can sleep at anywhere that they feel is suitable. The fourth respondent, (Fathiah Binti Osman)
said that backpacking is when we make our own travel itinerary. This includes accommodation,
transportation and place to eat. And the last respondent (Cazerenth A/P Dugon), said that,
backpacking means travelling without any itinerary and low budget. Based on all the statements,
researcher can conclude that all the respondents are clearly understood about the meaning of
backpackers
 12

2.2 Based on your experience, why did you choose backpacking ?

From the first respondent ( Nur Syafika Binti Azmi ) statements, she choose backpacking
because of being this, she can be more independent and brave. For example, during backpack,
they are more exposed to danger where we are travelling at unsual places. So this is the time
that we need to be more independent and brave to explore the place that we visit by asking
local people, surveying and studying. Other than that, this is one of learning process which
teaches me to become well planned person. For instances, backpacker usually will travel for a
long period and they need to plan the itinerary and time so that they can explore all the
interesting places. If they didn’t have a good plan, they might be some rough things happen but
actually this situation can be memorable moment for them. The second respondent (Nur Amirah
Binti Ahmad Jafri), said that, she choose backpack because she get to do want she want and
usually the cost of backpacking is cheaper. The third respondent ( Farah Farhana Binti Amin )
statements, backpacking are more adventures. This is because, we have to survive with the
minimal budget that you have. Besides, we also need to survive by searching for hotel that are
low cost and also the places that we want to visit. The forth respondent (Fathiah Binti Osman),
said that, by backpacking she will no need to follow the tight schedule as she can easily arrange
the flow of her vacation. And the last respondent (Cazerenth A/P Dugon), said that by
backpacking it can decrease the amount of expenses during travelling and can go anywhere
that she wants without any distraction.
 13

2.2 Did you prefer to travel inbound or outbound place ?

From the first respondent ( Nur Syafika Binti Azmi ) statements, she said that she prefer both
because, every country have their own attractions. The second respondent (Nur Amirah Binti
Ahmad Jafri), she also prefer both because, there are a lots of interesting place and easy to get
the Halal food. The third respondent ( Farah Farhana Binti Amin ) statements, she prefer to
travel inbound places, because it easy to explore everywhere as she is familiar with the rules
and regulations rather that travelling outbound. The forth respondent (Fathiah Binti Osman),
said that,she likes to travel inbound as it helps in cutting the cost of travel and easy to
communicate with the community. And the last respondent (Cazerenth A/P Dugon), said that
she loves to travel inbound as our country have its own uniqueness places to explore.
 14

2.3 In your opinion, what are the different between travel agency and backpacking in term of
price?

From the first respondent ( Nur Syafika Binti Azmi ) statements, the price of travel agency are
more expensive because the price is including their service charge and other chargers from
their supplier while backpackers are much cheaper as all the flow of money are controlled by
themselves. The second respondent (Nur Amirah Binti Ahmad Jafri), travel agency are bit
expensive because the price of their package is including everthing such as accommodation,
meals and tour guide. Backpackers are more cheaper because they choose to go by their own
and they can choose the accommodation and restaurants that are comfort with them. The third
respondent ( Farah Farhana Binti Amin ) statements, the price of backpacking are more lower
that travel agency as backpackers are for sure to cut the cost of travel. The forth respondent
(Fathiah Binti Osman), said that, travel agency offer the high prices for the customers as it had
been include everything and we no need to reschedule it again, while backpackers are low cost
as the backpackers control the budget by their own. . And the last respondent (Cazerenth A/P
Dugon), said that travel agency offer high price than backpackers as the travel agency
customize the itinerary including the accommodation, meals and transportation while
backpckers customize it by themselves according to their budget.
 15

2.4 Which one either travel agency and backpacking that offer flexible itinerary?

From the first respondent ( Nur Syafika Binti Azmi ) statements, backpacker is more flexible
because they can go anywhere and everytime they want as the time to visit is also not limited.
The second respondent (Nur Amirah Binti Ahmad Jafri), backpackers itinerary is more flexible
because it had been customize according their own itinerary. The third respondent ( Farah
Farhana Binti Amin ) statements, backpacking because it give freedom, they can go and visit
everywhere without the time limit. The forth respondent (Fathiah Binti Osman), said that,for sure
backpacking offer flexible itinerary as we are plan it by ourself. If we travel by travel agency, we
are subject to follow the itinerary given and can’t change it. And the last respondent (Cazerenth
A/P Dugon), said that backpackers offer flexible because all the itinerary are plan by themselves
so that they can go anywhere places that they want.

.
 16

CHAPTER 5

GAP ANALYSIS, CONCLUSION AND RECOMMENDATIONS

5.1 Introduction

The researcher will conclude the findings of the research based on the objective and the
researcher will show the gap analysis.

5.2 Gap Analysis

5.2.1 Summary of Gap Analysis
RESPONDENTS DEFINITION ANSWER LITERATURE REVIEW GAP

Backpacking is Backpacking is an independent

someone who is willing traveler that is a form of low
to travel by himself or cost expenditure. The expenses
Nur Syafika Binti in a small group by are including the use of
Backpacking
Azmi making arrangement backpack that is easily to
by their own. It is for carried, the use of public
sure to make sure that transport and accomodation.
the expenses are This submarket is characterized
lower. In addition, by budget consciousness and a
backpacking usually flexible tourism style, with most NO
involved teenagers. participants travelling alone GAP
(Regina Scheyvens, 2002)
Backpackers are
conceptualized by Loker-
Murphy and Pearce (1995) as
young and budget-minded
tourists who prefer low-priced
accommodation, who put an
emphasis on meeting other
 people (locals and fellow
travellers), who organise their
travel itineraries independently,
who are on extended rather
than short holiday, and who
have a taste for participatory
recreational activities

Nur Amirah Binti Backpacking is a form

Ahmad Jafri of cut cost,
independent travel, the
use of public transport
and inexpensive NO
lodging such as hotel. GAP
They preferred a
longer duration of the
trip
Farah Farhana Backpacking is a form
Binti Amin of independent travel.
This activity is for low
cost traveller where
usually they travel for
a long period and
distances. The real
backpacking is when a
backpacker take NO
challenge where they GAP
just go whatever they
want with minimal
planning. In fact,
sometimes they can
sleep at anywhere that
they feel is suitable.

Backpacking is when
we make our own
travel itinerary. This
Fathiah Binti includes NO
GAP
Osman accommodation,
transportation and
place to eat.

Backpacking means
Cazerenth A/P travelling without any
Dugon itinerary and low
budget. Based on all
the statements, NO
researcher can GAP
conclude that all the
respondents are
 clearly understood
about the meaning of
backpackers.

RESPONDENT TERM ANSWER LITERATURATE REVIEW GAP

The price of travel Backpackers who are

agency are more seeking a reasonably price
expensive because the that is suitable to their
price is including their budget as the cheaper price
1 Price service charge and other is always an advantage. NO
chargers from their Price and affordability were GAP
supplier while also expressed as value by
 backpackers are much many of the participants,
cheaper as all the flow of that the backpackers offered
money are controlled by a good value, or that added
themselves. value.

Travel agency are bit

expensive because the
price of their package is
including everthing such
2 as accommodation,
meals and tour guide. NO
Backpackers are more GAP
cheaper because they
choose to go by their own
and they can choose the
accommodation and
restaurants that are
comfort with them

The price of backpacking

3 are more lower that travel
agency as backpackers NO
are for sure to cut the GAP
cost of travel.

Tavel agency offer the

high prices for the
customers as it had been NO
include everything and GAP
we no need to
 4 reschedule it again, while
backpackers are low cost
as the backpackers
control the budget by
their own.

Travel agency offer high

price than backpackers
as the travel agency
customize the itinerary
including the
5 accommodation, meals NO
and transportation while GAP
backpckers customize it
by themselves according
to their budget.

RESPONDENT TERM ANSWER LITERATURATE REVIEW GAP

She prefer both In fact, some backpackers

1 Place because, every change the place in order to
country have their try the new one, join in
own attractions. group with new friends and
move to the nearby tourist NO
sites. They visits to popular
 places was also manifested GAP
in their accounts regarding
their behavior while
visiting them.

Prefer both because,

2 there are a lots of
interesting place and NO
easy to get the Halal GAP
food.

Travel inbound
places, because it
easy to explore
3 everywhere as she is
familiar with the rules GAP
and regulations
rather that travelling
outbound.

4 She likes to travel

inbound as it helps in
cutting the cost of
travel and easy to GAP
communicate with
the community
 She loves to Travel
inbound as our NO
5 country have its own GAP
uniqueness places to
explore.

RESPONDENT TERM ANSWER LITERATURATE REVIEW GAP

Every country Tourists say they prefer

1 Product have their own local food, adapt as much as
attractions they can to the traditions
and customs of the place in
which they are holidaying,
try to learn about their
destination before travelling,
 would be willing to be
involved in events organized
by the local community and
to interact with it,
demonstrate interest in the
protection of the authenticity GAP
of the destination, even if
this means going without
certain comforts, find out
how to protect the local
environment and reduce
waste, and are concerned to
ensure that their spending
benefits the local population.

She also prefer

both because,
there are a lots
2 of interesting GAP
place and easy
to get the Halal
food.

Travel inbound
places, because
it easy to
3 explore
everywhere as
she is familiar
with the rules GAP
and regulations
 rather that
travelling
outbound

Likes to travel
4 inbound as it
helps in cutting
GAP
the cost of travel
and easy to
communicate
with the
community

She loves to
travel inbound
5 as our country GAP
have its own
uniqueness

5.3 CONCLUSION

As a conclusion, nowadays we can see that there are so many people that choose backpackers
rather than travel agency. This is because people are more concern about the expenses during
the vacation. They will prefer to take the most low cost expenses as it will help them in cutting
the cost. This is due to the several reasons that might affect the decision making. And thus, this
research is answer to explore what are the factors that influences people to choose
backpackers rather than travel agency. The characteristic of the effective marketing should be
more focused as it gives the greater impacts towards the organization. As nowadays is the
global competition, so the marketing mix plays an vital role to help in company development.
This research had been done to understand the characteristic of the effective marketing mix for
Azam Travel and Tours Sdn Bhd to increase performances in future. For the first research
question, it was clearly stated that all the respondents are understood and clearly know what the
meaning of backpacking are. Same goes to the second research question, it had been answer
about the marketing mix that are very influenced.

27

5.4 RECOMMENDATION

After doing this research, there is several recommendation for Azam Travel & Tours Sdn Bhd
that need to be done to make sure that this company are delivering a good services to their
customers and increase the performance of the company from time to time.

5.4.1 Digital Marketing Courses

Today is the world of modern technology that all industry is conducted by online. Thus, Azam
Travel & Tours Sdn Bhd should held digital marketing courses for the staff. In can be more
benefits as it enhance the skills of the employee in marketing fields and for sure can help in
development of the company. By this course, it will contribute to expose the services offered by
Azam Travel & Tours Sdn Bhd to the people especially around Seremban. There are lots of
private firm that offer digital marketing courses with valid certificate. Although the expenses of
this course are quite expensive, for sure it will give a good return in future.

5.4.2 Strategic Customer Relationship Management

Azam Travel & Tours Sdn Bhd should improve in term of customer relationship management. It
was very important as it was a key factor to know well about their customers in term of
preferences of their travelling. The database management system for customer support should
be available to find out customer requirement and evaluate satisfaction. Thus, it will easier to
the company to customize or provide a good services to the customers.

28

REFERENCES

Katanyu Hiransomboona, (2012), “Marketing Mix Affecting Accommodation Service Buying

Decisions of Backpacker Tourist Traveling at Inner Rattanakosin Island in Bangkok, Thailand”,
Journal of Tourism and Hospitality Planning & Development , Vol 3,
http://dx.doi.org/10.1080/14790530601132385
Katanyu Hiransomboon, (2012), “Marketing Mix Affecting Accommodation Service Buying
Decisions of Backpacker Tourist Traveling at Inner Rattanakosin Island in Bangkok, Thailand”,
Procedia Economics and Finance, pp. 276 – 283