TOURISM AND

HOSPITALITY MARKETING
TOUR 75
UNDERSTANDING THE
HOSPITALITY AND TOURISM
MARKETING PROCESS
Part 1
Service Characteristics of Hospitality
and Tourism Marketing
Chapter 2

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I. The Service Culture
 A system of values and beliefs in an
organization that reinforces the idea that
providing the customer with quality service is the
principal concern of the business.

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 Let us recall JetBlue AIRWAYS
 Such tangibles help keep JetBlue travelers satisfied. But
JetBlue CEO David Barger knows that the tangibles are
only a small part of what really makes JetBlue special. “The
hard product—airplanes, leather seats, satellite TVs—as
long as you have a checkbook, can be replicated,” says
Barger. “It’s the JetBlue culture that can’t be replicated. The
human side of the equation is the most important part of
what we’re doing.” It’s that JetBlue culture—the near-
obsessive focus on the customer flying experience—that
creates not just satisfied JetBlue customers, but delighted
ones
The Service Culture
 The service culture focuses on serving and satisfying
the customer.
 Creation of a service culture has to start with top
management and flow down.
 An organization should hire employees with a customer
service attitude, and then it works with employees to
instill the concept of service.
 The outcome of these efforts is employees who provide
service to the customers.

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II. Characteristics of Service Marketing

1. Intangibility
A major characteristic of services; cannot be
seen, tasted, felt, heard, or smelled before they
are bought.

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 Hospitality and travel industry products are
experiential only, and we do not know the quality of
the product until after we have experienced it.
 A restaurant customer will not know how good
the meal is until after he or she has consumed
it.
 A family planning a vacation will not know if the
destination for their vacation and the choice of
their resort was a good one until they have had
their vacation experience.

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 One implication of experiential products is that we take
away only the memories of our experiences.
 Hence, create memorable guest experiences.

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 Service marketers should take steps to provide their
prospective customers with evidence that will help them
evaluate the service.

 This process is called providing tangible evidence.

 Promotional material, employees’ appearance, and
the service firm’s physical environment all help
tangibilize service.

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 The salesperson may be the prospective customer’s first
contact with the hotel or restaurant.

 A salesperson who is well groomed and dressed

appropriately and who answers questions in a prompt,
professional manner can do a great deal to help the
customer develop a positive image of the hotel.

 Uniforms also provide tangible evidence of the experience.

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Physical Evidence
 Tangible clues such as promotional material, employees
of the firm, and the physical environment of the firm.
Physical evidence is used by a service firm to make its
product more tangible to customers.

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 Physical evidence that is not managed properly can hurt a
business.

 Negative messages communicated by poorly managed physical

evidence include
 signs that continue to advertise a holiday special two weeks after
the holiday has passed,
 signs with missing letters or burned-out lights,
 parking lots and grounds that are unkempt and full of trash, and
 employees in dirty uniforms at messy workstations.
 a burned-out bulb can give a guest sitting near it an impression that
the restaurant does not pay attention to detail
 Our customers notice details; this is why a consistent message from
industry leaders is that managers must pay attention to detail.

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 2. Inseparability
 A major characteristic of services; produced and
consumed at the same time and cannot be
separated from their providers.
 Inseparability means both the employee and the customer are often
part of the product.
 The food in a restaurant may be outstanding, but if the employee serving
the food to the customer has a poor attitude or provides inattentive
service, customers will not be satisfied with their experience.
 Hospitality products are first sold and then produced and consumed
at the same time. In most hospitality services, both the service
provider and the customer must be present for the transaction to
occur.

Characteristics of Service Marketing Prepared by FELICIDAD F. AGUSTIN

 Another implication of inseparability is that
customers and employees must understand the
service-delivery system because they are coproducing
the service.
 This means hospitality and travel organizations have to
train customers just as they train employees.

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 3. Variability
 A major characteristic of services; their quality may vary
greatly, depending on who provides them and when, where,
and how they are provided
 Services are highly variable.
 Their quality depends on who provides them and when and
where they are provided.

Characteristics of Service Marketing Prepared by FELICIDAD F. AGUSTIN

  There are several causes of service variability.
 Services are produced and consumed simultaneously, which
limits quality control.
 Fluctuating demand makes it difficult to deliver consistent
products during periods of peak demand.
 The high degree of contact between the service provider and
the guest means that product consistency depends on the
service provider’s skills and performance at the time of the
exchange.
 A guest can receive excellent service one day and mediocre
service from the same person the next day.
 Lack of communication and heterogeneity of guest expectations
also lead to service variability.

Variability Prepared by FELICIDAD F. AGUSTIN

 Variability or lack of consistency in the
product is a major cause of customer
disappointment in the hospitality industry.
 Consistency is one of the key factors in the success of a
service business.
 Consistency means that customers receive the expected
product without unwanted surprises.

Variability Prepared by FELICIDAD F. AGUSTIN

 Three steps hospitality firms can take to reduce variability
and create consistency:

1.Invest in good hiring and training procedures.

 Recruiting the right employees and providing them with excellent training
is crucial, regardless of whether employees are highly skilled
professionals or low-skilled workers.
 Better trained personnel exhibit six characteristics:
Competence— possess the required skill and knowledge
Courtesy—friendly, respectful, and considerate
Credibility—trustworthy
Reliability—perform the service consistently and accurately
Responsiveness—respond quickly to customers’ requests and problems
Communication—make an effort to understand the customer and communicate
clearly.

Variability Prepared by FELICIDAD F. AGUSTIN

Three steps hospitality firms can take to reduce variability and
create consistency:

2.Standardize the service-performance process

throughout the organization.
 Diagramming the service-delivery system in a service blueprint .
 Service blueprints include a line of interaction, line of visibility and
line of internal support.
 The line of interaction represents the guest’s contact with employees.
 The line of visibility represents those areas that will be visible to the
guest and provide tangible evidence of the service.
 The line of internal interaction represents internal support systems that
are required to service the guest.

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Restaurant
Airline

Blue print samples

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Three steps hospitality firms can take to reduce variability
and create consistency:

3.Monitor customer satisfaction.

 Use suggestion and complaint systems, customer
surveys, and comparison shopping.
 Travel intermediaries, such as Travelocity.com,
contact guests to see how satisfied they were with a
hotel they booked on their site.
 Firms can also develop customer information
databases and systems to permit more personalized,
customized service, especially online.

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4. Perishability
 A major characteristic of services; they cannot be
stored for later use.
 A 100-room hotel that sells only 60 rooms on a particular night cannot
inventory the 40 unused rooms and then sell 140 rooms the next night.
Revenue lost from not selling those 40 rooms is gone forever.
 Because of service perishability, airlines and some hotels charge guests
holding guaranteed reservations when they fail to arrive.
 Restaurants are also starting to charge a fee to customers who do not
show up for a reservation. They, too, realize that if someone does not show
up for a reservation, the opportunity to sell that seat may be lost.

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 Intangibility
Inseparability
Services cannot be
Services cannot be
seen, tasted, felt,
separated from their
heard, or smelled
providers
before purchase

Services

Variability
Quality of services Perishability
depends on who Services cannot be
provides them and stored for later sale
when, where, and or use
how

Four service characteristics.

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III. SERVICE MANAGEMENT CONCEPTS

A. Service profit chain

 A model that shows the relationships between
employee satisfaction, customer satisfaction,
customer retention, value creation, and
profitability.

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III. SERVICE MANAGEMENT CONCEPTS
B. Types of marketing
1. Internal marketing
2. External marketing
3. Interactive marketing

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Three Types of Marketing
1.Internal marketing
 means that the service firm must effectively train
and motivate its customer-contact employees and
all the supporting service people to work as a team
to provide customer satisfaction.
 For the firm to deliver consistently high service quality,
everyone must practice customer orientation.
 Everyone else in the organization must also practice
marketing.
 Internal marketing must precede external marketing.
Failure to practice internal marketing can be expensive.
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Three Types of Marketing
2. Interactive marketing
 means that perceived service quality depends heavily on
the quality of the buyer–seller interaction during the service
encounter.
 In product marketing, product quality often depends little on
how the product is obtained.
 Unlike in services marketing, service quality depends on both
the service deliverer and the quality of the delivery. The
customer judges service quality not just on technical quality
(the quality of the food) but also on its functional quality (the
service provided in the restaurant). Service employees have to
master interactive marketing skills or functions as well.
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Three Types of Marketing
3. External marketing
 External marketing is the action or business of
promoting and selling services or products,
including market research and advertising to clients
and potential.

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Three types of marketing in service industries.
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IV. Management Strategies for Service Businesses

A. Managing differentiation
 The solution to price competition is to develop a
differentiated offering. The offer can include
innovative features that set one company’s offer
apart from that of its competitors.

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IV. Management Strategies for Service Businesses

B. Managing service quality.

With hospitality products, quality is measured

by how well customer expectations are met.

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IV. Management Strategies for Service Businesses

C. Manage service productivity

train current employees better or hire new ones who
will work harder or more skillfully.
increase the quantity of their service by giving up
some quality
“industrialize the service” by adding equipment and
standardizing production
harness the power of technology

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 IV. Management Strategies for Service Businesses

However, avoid pushing productivity so hard that

doing so reduces quality
Attempts to industrialize a service or cut costs can
make a service company more efficient in the short
run BUT in making them more efficient, they can
become less effective.
Thus, in attempting to improve service productivity,
be mindful of how to create and deliver customer
value. In short, be careful not to take the “service”
out of service.
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IV. Management Strategies for Service Businesses

D.Resolving customer complaints.

 Resolving customer complaints is a critical component of customer retention.

E. Managing employees as part of the product.

 In the hospitality industry, employees are a critical part of the
product and marketing mix. The human resource and marketing
department must work closely together.
The task of internal marketing to employees involves the
effective training and motivation of customer-contact employees
and supporting service personnel.

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IV. Management Strategies for Service Businesses

F. Managing perceived risk.

 The high risk that people perceive when purchasing
hospitality products increases loyalty to companies
that have provided them with a consistent product in
the past.

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IV. Management Strategies for Service Businesses

G.Managing capacity and demand.

Because services are perishable, managing capacity
and demand is a key function of hospitality marketing.
First, services must adjust their operating systems to
enable the business to operate at maximum capacity.
Second, they must remember that their goal is to
create satisfied customers.
Research has shown that customer complaints
increase when service firms operate above 80 percent
of their capacity.

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Capacity and demand
 Involve the customer in the Service-Delivery System
Self-service technologies (SSTs) allow the customer to
serve as the company’s employee.
 Cross-train employee
 Use part-time employee
 Rent or share extra facilities and equipment
 Schedule downtime during periods of low demand
 Change the Service-Delivery System

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Demand Management
 Use price to create or reduce demand
 Use reservations
 Overbook
 Revenue Management
A pricing method using price as a means of matching
demand with capacity
 Use queuing
 Shift demand
 Create promotional event Prepared by FELICIDAD F. AGUSTIN
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Chapter Activity

Internet Exercises:

Visit the Web site of a tourism destination; it

can either be a city or be a country. Explain
how the site provides tangible evidence
relating to the experiences a visitor to the
destination can expect.

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