NOTE: Free essay sample provided on this page should be used for references or sample purposes only. The sample essay is available to anyone, so any direct quoting without mentioning the source will be considered plagiarism by schools, colleges and universities that use plagiarism detection software. To get a completely brand-new, plagiarism-free essay, please use our essay writing service.
One click instant price quote
[Course Title] Marketing of Service Product The four major elements of a marketing mix are: product, pricing, distribution and promotion. Each element has a strategy. For example, pricing is more than setting a price. Pricing also includes setting a price to compete with other companies in the market and increasing or decreasing it according to demand to maximize profits and avoid the business from having financial problems. The product description is important as it helps a company determine the service area they specialize in. The market placement of a service is also important as it helps the company choose its target market and segment the market area they wish to focus on.
Promoting the service is the most important part as it decides the advertising modes the company will use. (Mccoll-Kennedy 620) A second stream of work examines marketing mix elements as signals of quality. Spence (47, 1974) defined signals as manipulable attributes or activities that convey information about the characteristics of economic agents (e. g. , firms, consumers, job applicants). Thus, marketing mix elements such as packaging, advertising, and warranties not only provide direct product information but also convey indirect information on product attributes about which consumers are imperfectly informed. Therefore, mix elements may serve effectively as signals.
For example, advertising may serve as a quality signal (Kihlstrom & Riordan 427 - 450; Milgrom & Roberts 796 - 821) if consumers perceive high advertising costs as demonstrating a firm's commitment to its brand. The reasoning would be that fly-by-night producers, for example, are much less likely to be able to afford expensive endorsers and spend a lot of money on advertising. A tourism company should employ a wide range of advertising communications and promotion to achieve its marketing goals. Research on the demographics of the target market suggests that the most effective communications will come through advertising in several specialty publications and via local radio.
In addition, direct interaction or promotion at health clubs, shopping malls, sporting events, etc. should be part of the marketing mix. The companys marketing objectives should eb as follows: Achieve an annual growth rate of at least 10 %. Promote adventure activities through strategic alliances with health clubs, local athletic organizations, and retailers. By the end of year three, achieve 15 % of sales through the Internet. Become the market leader of adventure travel in the area it specializes in. (Brent 220 - 235) The companys financial objectives should be: Generate sales of approximately $ 550, 000 in year one and increase sales 10 % annually.
Capture and maintain a gross margin of 18 - 20 %. Achieve positive net worth by year two. The company should sell standard travel agency goods and services including airfare and travel packages. Additional services should include assistance with passports, providing access to top-of-the-line equipment and supplies, and a superior offering that includes access to better than average terrain and activities, accommodations, and entertainment. The value added of the companys offering is its knowledge and expertise, competitive rates, and specialty focus on adventure travel, which should translate into increased assurance and satisfaction for the customer. The companys decision to focus on adventure travel should be made because economic indicators suggest that an increased demand for adventure travel services exists, the tourism area targeted that does not have a true adventure travel specialist, should have the tourism companys members on a team that experienced and enthusiastic about adventure travel activities.
It is hoped that this enthusiasm will be communicated to the customer, and the members experience will translate into satisfaction and repeat business. (Medlick 91). Much of the tourism companys pricing should be determined by market standards. ATI should attempt to maintain margins of 10 % on all airline travel. Margins on all other products and services vary depending upon the provider but are expected to average 20 %. The company should make every effort to maintain a competitive pricing policy. However, as it builds its reputation as the premier provider of adventure travel, it should expects to earn the ability to charge a premium for its services.
During the companys first year of operation, it should hold a grand opening and should organize and sponsor several athletic events. Events should include, among others, an off-road triathlon, 10 k race and 5 k fun run, and a mountain-bike race. The company should provide various travel packages and other items as prizes. All company employees should belong to local athletic clubs and should, through interaction with other members, promote the companys services. During the grand opening and other events, the company should provide literature with information about trips and activities. Negotiations with area health clubs should begin and additional promotion should likely occur through these strategic alliances.
Specialty rather than large national publications should serve as media vehicles for company advertising. Local radio stations should also be used. Personal selling should also occur, though phone solicitation should be limited. The company should plan to occasionally station sales personnel in locations around the see it covers, such as shopping malls. The company's goals should be to develop personal familiarity between its employees and the community. (Zafar 13 - 18) Ongoing industry analysis should be conducted by several organizations, including the U.
S. Department of Commerce, and should available for sale. Research on the travel and tourism industry should be purchased as necessary. Demographics and spending patterns of adventure travelers should be secured and used to formulate communications strategy. The company should conduct customer surveys when a specific research problem is identified. The company should also subscribe to several industry publications and attend trade shows to stay abreast of relevant issues. (Coltman 89) The company should target the following groups: Couples and individual adventure travelers: This is the customer group that meets the demographic profile for adventure travelers -- ages 25 - 35, married, with household income greater than $ 50, 000.
Group adventure travelers: These are groups that belong to local athletic organizations, such as cycling or kayaking clubs. Corporate adventure travelers: ATI will target local businesses in an attempt to secure corporate accounts. The company should to focus its initial efforts on the adventure travel market in the greater area it specializes in. As the company grows, marketing efforts will expand. The major purchasers that fit the companys target market should be located in urban areas within states For individual and corporate clients who wish to participate in adventure travel, the company should be a premier adventure travel agency in the area it specializes in.
The company's experience with and enthusiasm for adventure travel should be displayed in the exceptional service, value, and advice it provides for the customer. (Coskun, Palda & Barker 45 - 51) The companys marketing strategy should be as follows. 1. Develop brand recognition through the use of effective advertising, marketing communications and promotion. Develop a marketing mix designed to target the specialized market. Print and electronic advertising campaign, using specialty publications and local radio as primary media. (Vogt, Fesenmaier & MacKay 133 - 146) Use strategic alliances to conduct promotions and giveaways.
Expand brand recognition to the national market through increased industry participation and WWW presence. Utilize the networking benefits of industry associations, trade shows, and publications. Develop and promote the company website. The availability of information and the ability to schedule and purchase online will be beneficial to the customer and the company. (Stewart & Hull 3 - 20) 3. Increase revenues and reduce costs by establishing repeat and corporate customers.
Customer satisfaction program. Focus the companys efforts on customization of adventure travel and utilization of its core competencies. The company should rather recommend that a potential customer purchase elsewhere than provide a trip outside of its expertise. Post purchase and post trip follow-up. Research indicates that the communication between the firm and the customer after the sale positively influences repeat purchase.
Corporate account acquisition. The corporate sales program should depend upon specialized literature and personal promotion. Corporate accounts generate recurring revenue and will help diversify the companys sources of income. Corporate giveaway promotion. Trips should be awarded as prizes and should be promoted via local radio. (Selin & Myers 79 - 94) Works Cited Mccoll-Kennedy, J. B.
Services Marketing, John Wiley & Sons Inc, 2003, 620. Spence, M. Market signaling: Informational transfer in hiring and related screening processes. Cambridge, MA: Harvard University Press, 1974.
Milgrom, P. , & Roberts, R. "Prices and advertising signals of product quality." Journal of Political Economy, 94, 1986 796 - 821. Kihlstrom, R. E. , & Riordan, M. H. "Advertising as a signal." Journal of Political Economy, 92, 1984. 427 - 450. Medlick, S. Managing Tourism, Butterworth Heinemann, Oxford, 1991.
Brent, Ritchie J. R. "Tourism, Marketing, and the Quality-of-Life. " In Marketing and the Quality-of-Life Interface, A. Coskun Samli (ed. ), pp. 220 - 235. New York: Quorum, 1987. Zafar, Ahmed. "Understanding Residents' Reaction to Tourism Marketing Strategies. " Journal of Travel Research 25: 13 - 18, 1986. Coltman, Michael M.
Tourism Marketing. New York: Van Nostrand Reinhold, 1989. Coskun, Samli A. , Kristian Palda, and A. Barker. "Toward a Mature Marketing Concept. " Sloan Management Review Winter, 1987, pp. 45 - 51. Vogt, C. A. , Fesenmaier, D.
R. & MacKay, K... Functional and aesthetic information needs underlying the pleasure travel experience. Journal of Travel & Tourism Marketing, 2 (2 / 3), 1993, 133 - 146. Stewart, W. P. & Hull, R.
B. Capturing the moments: Concerns of in situ leisure research. Journal of Travel & Tourism Marketing, 5 (1 / 2), 3 - 20, 1996. Selin, Steven, and Nancy Myers. "Tourism Marketing Alliances: Member Satisfaction and Effectiveness Attributes of a Regional Initiative, " Journal of Travel and Tourism Marketing 7 (3), 1998, 79 - 94.
Free research essays on topics related to: strategic alliances, quality of life, grand opening, adventure travel, marketing mix
Research essay sample on Quality Of Life Strategic Alliances
