INTRODUCTION TO -...

Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens

INTRODUCTION TO

Sales and Marketing

HT618/Topic1/May 2012

Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens2HT618/Topic1/May2012

WHAT IS MARKETING?

1. Marketing is a social and managerial

process by which individuals and

groups obtain what they need and

want through creating and exchanging

products and value with others.

HT618//Topic1/May2012

(Kotler, Bowen, & Makens, 2006)

WHAT IS MARKETING?

2. Marketing is a planning and

implementation process of concepts,

price, promotion and idea distribution,

product and services to form a

transaction that satisfy the individual

and organization objectives.

(American marketing Association)

HT618/Topic1/May2012

3. Marketing is a societal process by

which individuals and groups obtain

what they need and want through

creating, offering, and exchanging

products and value with others. (Philip Kotler)

WHAT IS SALES?

HT618//Topic1/May2012

Sales consists of direct efforts to sell the

product by personal sales, calls,

telecommunications & mailings.

Sales activities include activities designed

to promote customer purchase of a

product or service in order to generate

positive cash flow for the organization”.

(Levitt 1960; dictionary 2010)

Upper Saddle River, NJ 07458 Kotler, Bowen, and MakensHT103/Topic1/June2011

Upper Saddle River, NJ 07458 Kotler, Bowen, and MakensHT618/Topic1/May2012

A NEED is a human need is a state of felt

deprivation that requires him/her to fulfill it.

WANTS are how people communicate their

needs. Refer to a higher levels of needs.

DEMANDS are wants for specific products that are backed by an ability and willingness to buy them. When backed by buying power, wants

become demands.

A product is anything that can be

offered to satisfy a need or a want.

What are some travel and tourism

“products” that you can list?

A market is a set of actual and

potential buyers who might

transact with a seller

• Customer value is the difference between the

customer benefits from owning and/or using a

product and the costs of obtaining the product

• Customer satisfaction is perceived value

delivered relative to a buyer’s expectations

• Quality is the totality of features and

characteristics of a product or service that bear on

its ability to satisfy customer needs

Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens11

Exchange

• The act of obtaining a desired object from someone by offering something in return.

A Transaction

• Marketing’s unit of measurement and consists of a trade of values between two parties.

Relationship

Marketing

• Builds relationships with valued customers, distributors, dealers, and suppliers by promising and consistently delivering high-quality products, good service, and fair prices.

Upper Saddle River, NJ 07458 Kotler, Bowen, and MakensHT618/Topic1/MAY2012

The selling concepts holds that consumers, if left alone, they will not buy any marketed products. Therefore the consumers has to

be influenced to buy, through an aggressive marketing activities,

namely promotion and sales.

Sales concept in marketing is a way that a company can position itself towards the

market.

One of the most important aspects of a business is `making a

sale' because if this does not happen you will have

no customers and no revenue.

Starting Point Focus Means Ends

Factory ProductSell and

Promote it

Profits through

sales volume

The Selling Concept

MarketCustomer

Integrated

marketing

Profits from

satisfied

customers

The Marketing Concept

DIFFERENCES BETWEEN MARKETING AND SALES

ACTIVITIES

MARKETING SALES

Market analysis, planning, and control.

Field work and desk work to sell to consumers.

Long-term trends, and how to translate problems and opportunities into new products, markets, and strategies for long-term growth.

Short-term considerations, such as today's products, markets, consumers, and strategies.

Profit planning, such as determining the appropriate mix of business from individual market segments.

Volumes and quotas, current sales, bonuses, and commissions.

Marketing

(set of activities)

Operation

(production)

(revenues)

achieving the GOAL of the firm / to

satisfy CUSTOMERS needs & wants

Any activity or benefit that party can

offer to another that is essentially

intangible and does not result in the

ownership of anything. Its

production may or may not be tied to

a phsyical product.

WHAT IS SERVICE?

(Kotler 1994: Swarbrooke, J. & Horner, S.; 1996)

Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens18

Marketing services are different from marketing goods.

CHARACTERISTICS OF SERVICE MARKETING

Lack Of Ownership

Customer did not have

ownership on the service.

Only for a certain period of

Is The Characteristics Of Services Any Different

To The Physical Products?

Information scientists are often providing services (eg advice, or searches), rather than

physically distinct products.

Marketing a service is more difficult than

marketing a tangible product.

8 Specific Characteristics

Differences of Tourism Services

• Shorter exposure to services 1

• More emotional buying appeals2

• Greater importance on managing evidence

• Greater emphasis on stature and imagery

• More variety and types of distribution channels

• More dependence on complementary organizations

• Easier copying of services7

• More emphasis on off-peak promotion

• Shorter exposure to

services 1

The customer's exposure to most hospitality and

travel services is usually shorter.

In many cases our services, including trips to fast-

food restaurants, short commuter flights, and

visits to travel agencies, are consumed within an

hour or less.

There is less time to make a

good or bad impression on

customers.

Most manufacturers offer warranties

and guarantees on their products,

sometimes covering several years;

however, not many similar assurances

of quality are available with

hospitality and travel services.

Whereas inadequately cooked menu items can be

sent back to the restaurant kitchen, many

hospitality: and travel services that do not work

cannot be returned and exchanged for similar ones

since they are more intangible.

• More emotional buying appeals2

You buy products knowing that they will

perform a specific function for you, using rational

(logical or fact-based) rather than emotional

(feeling-based) reasoning.

There are a few exceptions where some

people form a close emotional bond

with specific products and brands.

People provide and receive our services A person-

to-person encounter always takes place.

This emotional bonding happens more

frequently with hospitality and travel

services because, above all else, ours is

a people industry.

Emotions and personal feelings are generated by

these service encounters, and they influence

future purchase behavior.

People also tend to buy hospitality and travel

services that match their self-images. They fly

first class and stay at a Four Seasons Hotel

because it fits the mental picture of themselves

as successful business people.

They use a combination of rational

(more services and giveaways) and

emotional (status or class) reasons

when they buy these services

• Greater importance on

managing evidence3

Whereas a product is basically a tangible object, a

service is in essence a performance. Customers

cannot see, sample, or self-evaluate services because

of their intangibility, but they can see various

tangible factors associated with these services.

Customers then rely more heavily on these tangible

clues or evidence when they are purchasing services.

The combined effect of these tangible clues

determines their assessment of the service's quality

and how well it will meet their needs.

1. Physical environment can include the

types of furniture, carpeting, wall

coverings, staff uniforms, and signs that a

hotel or restaurant uses.

2. Price

3. Communications

4. Customers

The evidence falls into FOUR (4)

categories:

•Greater emphasis on

stature and imagery 4

A related concept is the stature

and image of hospitality and

travel organizations.

Because the services provided are mainly

intangible and customers frequently have

emotional reasons for buying them,

organizations put great effort into creating

the desired mental associations.

•More variety and types of

distribution channels 5

There is no physical distribution

system for hospitality and travel

services.

Instead of a distribution system,

our industry has a unique set of

travel intermediaries, including

travel agents and companies that

put together vacation packages

(tour wholesalers).

In contrast, many travel intermediaries

greatly influence what the customer buys.

Travel agents and incentive travel and

convention planners are looked to for advice

on destinations, hotels, attractions, vacation

packages, tours, and transportation.

Customers see them as experts

and take their recommendations

seriously.

•More dependence on

complementary organizations 6

A travel service can be extremely complex,

beginning when customers notice the advertising

for a particular destination.

These advertisements may be promotional

campaigns funded by government tourism

promotion agencies or convention and visitors

bureaus.

Customers may then visit travel

agencies for more detailed information

and advice.

What this adds up to is that many different

organizations provide the travel service

experience.

The experience suppliers are interdependent

and complementary.

Travelers evaluate the overall quality of their

experiences based on the performance of every

organization involved.

• Easier copying of services7

Most hospitality and travel services are easy to

Most services in hospitality and travel

provides cannot be patented because services

are provided by people and can be imitated by

other people.

• More emphasis on off-peak

promotion 8

With few exceptions, there is a need for an entirely

different schedule of promotions in hospitality

and travel industry.

Heavy off-peak promotion is the rule, rather than

the exception because:

Customers make a large emotional

investment in their vacations.

The capacity to produce is usually fixed.

There is more pressure to use available

capacity in off-pack periods.

5 UNIQUE FEATURES OF TOURIST

DEMAND AND TOURISM PRODUCT

Use Of More Than 4 Ps

Greater Significance Of Word-of-mouth Information

More Use Of Emotional Appeals In Promotion

Greater Difficulties With New-concept Testing

Increased Importance Of Relationship With Complementary Organizations

Use Of More Than 4 Ps

It is a business of people (staff)

providing services to people

(customers), who share these services

with other people (other customers).

There are 4Ps more in hospitality and travel

industry ; People, Packaging, and Programming,

Partnership.

People hospitality and travel is a people

industry.

Packaging and Programming are two related

techniques and significant for two reasons:

Partnership is cooperative marketing

efforts among complementary

hospitality and travel organizations.

1. They are very customer oriented

concepts.They satisfy a variety of

customer needs, including the desire or

convenience found in all-inclusive

packages.

2. They help business cope with the

problems of matching demand with

supply or reducing unsold inventory.

Greater Significance Of Word-of-mouth Information

The opprtunities for customers to sample

services prior to purchasing them are limited in

hospitality and travel industry.

The rule is, “you have to buy to try.”

This places a premium on word-of-mouth

advertising . (information about a

service experience passed from past to

potential customers).

Providing a consistent quality of

service and associated facilities is a

key ingredient in getting good

word-of-mouth.

Consistency of evidence ensures that

customers leave with a consistent

impression of an organization’s quality

standards.

More Use Of Emotional Appeals In Promotion

Because of the intangible nature of services,

customers tend to make more use of emotional

appeals when they buy.

This means that is often more effective to emphasize

these appeals in promotional campaigns.

In order to make resort, vacation package, or

attraction appeal to customers, it must be given a

distinctive personality.

Companies must be given personalities with which

cutomers can associate. For example your resort

becomes the “Friendly resorts” and so on.

Greater Difficulties With New-concept Testing

Services can be copied more easily than products.

This makes it essential for hospitality and travel

organizations to be ever-alert for new and

innovative customer services.

Leading corporations aware of this and are

constantly test marketing new concepts. With the

increasing dynamics of Malaysian society, it is

unwise to standstill in our business.

Increased Importance Of Relationship With Complementary Organizations

There are 3 unique relationships among organizations

in our industry that have a significant impact on the

marketing of hospitality and tavel services:

1. The relationship between suppliers, carriers, the

travel trade, and destination marketing

organization.

2. The destination mix concepts relation concept

with 5 components: attraction & events, facilities,

infrastructure, transportation, and hospitality

resources.

3. Visitor and residents both intermingle

and share the same services and

facilities.

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