Tourism marketing

The main concern of many professionals in

the tourism industry is that the industry must

focus much more on pleasing customers and
keeping them happy and secure.

The philosophy of marketing is to put the

customer first.

From this perspective, the primary goal of

hospitality and tourism business should be to

create and retain satisfied customer
Kisasembe Richard

 From this point of view, many scholars come up with several

definitions to suit their management needs. These definitions

cut across to both manufactured products and non
manufactured ( intangible) as follows

To start with Kottler (2009) Marketing is

defined as a social and managerial process

by which individuals and groups obtain
what they need and want through creating
and exchanging value with others.
According to him marketing is about
managing profitable customer relationships
i.e attracting new customer ,retaining and
growing customers

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 Chartered institute of marketing,

(1984)on other hand defined Marketing

as a management process responsible for
identifying, anticipating and satisfying
customer requirements profitably
American marketing association further
defined Marketing as a process of
planning and executing the conception,
pricing, promotion, and distribution of
ideas, goods and services to create
exchange that satisfy individual and
organization objectives
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The definitions summarized above has four critical features.

These are:
1.Marketing Is a Process. A process is a particular method

of doing an activity, generally involving a series of steps or

operations. The classical marketing approach involves four
broad steps: market analysis, market planning,
implementation, and control.

Market analysis involves searching for opportunities in the

marketplace.

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 Market planning requires segmentation, target market

choice, positioning, and the design of the marketing mix.

Market

implementation includes the systems and

processes to go to market with the marketing program.

Finally, marketing control refers to the informal and formal

mechanisms that marketing managers can use to keep the

marketing program on course.

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2.

It involves a Mix of Product, Pricing, Promotion, and

Distribution.
The strong marketing programs do not involve one action,
such as the design of a great product. Rather, the most
successful marketing programs involve mixing the
ingredients of marketing to deliver value to customers. This
mixing entails blending the right amounts of the 4P
ingredients, at the right time, and in the right sequence.

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3.

It is about Exchange.
Marketing is not successful unless two parties exchange
something of value. The buyer may exchange time,
money, or services, while the seller must exchange
something of value to the buyer.

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4.

It
is
intended
to
Organizational Needs.

Satisfy

Individual

and

The aim of marketing is to provide a satisfactory outcome

for both the firm and the customer. Firms can have highly
satisfied customers if they provide services for free. The
key to modern marketing is simultaneously satisfying the
customer, the firm, and its shareholders

Kisasembe Richard

 Marketing puts the consumer or customer at the center of the

organization decision making.

It is about attracting customers and keeping them.

After all, if there are no customer there will be no organization
So marketing is getting the right product to the right customer

at the right price, in the right place using right promotion tool at
the right time

Kisasembe Richard

 In other words, it is the process of understanding, creating,

and delivering profitable value to targeted customers better

than the competition.

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 Aspect

of superior
management

Company need to find

delivery of value

value

is

important

in

marketing

ways to ensure they optimize the

Value of tourism product includes a number of different

aspects which include the perception of price, quality and

image as well as the economic and social aspects of the
consumer

Kisasembe Richard

Customer perceived value is

based upon

Actual price asked and the relativity to the

prices for the same or similar product
offered elsewhere
Perceived quality, service and image
associated with the brand/product
Convenience of purchasing method or
channel
Consumer difficulty in ability to assess the
benefits/relative price of the product
Experience associated with purchase or
consumption process
Kisasembe Richard

 Selling focus on the needs of the seller, while marketing

focus on the needs of the buyer.

Seller is preoccupied with the sellers need to convert his

product into cash while marketing preoccupied with the idea

of satisfying the needs of the customer by means of the
product and the whole cluster of things associated with
creating, delivering and finally consuming it

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 Inform about product

Ensure customer satisfaction
Meet customer needs
Generate income and make profit
Generate social profit
Promote to customer
Influence product development

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Marketing people market 10 types of entities:

Goods-physical goods constitute

the bulk of most

countries production and marketing effort
Services-intangible product e.g bankers, hoteliers,
etc
Events-marketers promote time bases events such
as world cup, Olympic etc
Experiences- some organization market experience.
E.g disney theme park
Persons-celebrity marketing is a major business.
Artists, physicians, high profile lawyers and
finances, and other professional all get help from
celebrity
marketer.
Kisasembe Richard

 Places- cities, states, regions.

Properties-are intangible rights of ownership of either real

property( real estate) or financial property (stocks and

bonds)

Organizations-organizations actively work to build a strong,

favorable, and unique image in the mind of their target

publics.

Information- information is essential what books, schools and

universities produce, market, and distribute at a price to

parents, students, and communities

Ideas- every market offering includes a basic ideas

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Production

Marketing
Finance
Recearch &

CUSTOMER
development

Marketing
Human secource
management
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 Marketing is concerned with the flow of goods and services

from the points of production to the points of consumption.

There is a systematic arrangement of these functions of

marketing to move the goods and services to the needy

persons.

This system is essential to the creation of time, place and

possession utilities.

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Communication

Goods/services
Industry

Market

(a collection
of sellers)

(a collection
of Buyers)
Money

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Information

1.

Consumer market- are market that buy products or

service for personal consumptions.

2.

Business market- business buyers buy goods in order

to make or resell a product to others at a profit.

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3.

Global markets/International companies selling goods and

services in the global marketplace face additions
decisions and challenges.

They must decide which country to enter, how to enter

each ( as an exporter, licenser, joint venture partner,
contract manufacturer or sole manufacturer) how to
adapt, and how to price

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4.

Non profit and government Market- companies selling

their goods to non profit organizations such as churches,
universities, charitable organization and government
agencies need to price carefully, because these buyer
have limited purchasing power.

5.

Reseller- customer who by product to sell to final

consumer

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IMPORTANT TERM USED IN

MARKETING
A market-Traditionally, a market was a physical place where

buyers and sellers gathered to buy and sell goods, and of

course this type of market is still exists today.

In modern societies a market is much more complex, but

retains the core principles of bringing together buyers and

sellers with common interests.

Market- consists of all the potential customers sharing a

particular need or want who might be willing and able to

engage in exchange to satisfy that need or want

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 Customers buy a product.

Consumers use the product.
Example: Parents who buy video games

from retailers are customers. The kids who

play the video games are the consumers.

Needs describe basic human requirements such as food, air,

water, clothing, and shelter.

Wants are discretionary and learned during a persons life,

such as recreation, education, and entertainment

Kisasembe Richard

 Demands are needs and wants for specific products backed

by an ability to pay.
Marketing offer- Combination of products, services,
information or experiences that satisfy a need or want. Offer
may include services, activities, people, places, information
or ideas
Exchange-The act of obtaining a desired object from
someone by offering something in return
Benefits are outcomes sought by a customer that motivates

buying behavior.

Kisasembe Richard

MAARKETING MANAGEMENT PHILOSOPHIES

MARKETING CONCEPTS
There are FIVE competing concepts under which
organizations conduct their marketing activities:
The Production Concept
The Product Concept
The Selling Concept
The Marketing Concept
The Societal Marketing Concept

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Company

Produce more & more

Produce

Consumers

Sell
Practically sells itself

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 Consumers will favor those products that

are widely available and low in

cost/affordable
Therefore increase production and cut
down costs.
Focus on improving production and
distribution efficiency
And build profit through volume.
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Produce
Quality
Products
Sell

Practically sells itself,if

it gives most quality
for money
Consumers

Buyers admire well-made products and can

appraise product quality and performance.
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 Consumers will favor those products that offer the most

quality, performance, or innovative features.

Therefore, Focus on improving products quality,

performance and features.

This would lead to increased sales and profits.

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 Consumers have normal tendency to resist.

Produce
Sell it

Aggressive selling &

promotion efforts

Consumers

Making sales becomes primary function and

consumer satisfaction secondary .
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 Consumers , if left alone , will not buy enough of

companys products.

Customers will buy only when a large-scale selling and

promotion effort is employed

Therefore, promote sales aggressively.

And, build profit through quick turnover.

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 LOVE THE CUSTOMER , NOT THE PRODUCT

Consumers

Learn what they

want(MR)

Market it
Sell what they want(Satisfy
needs of customers)

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Produce it

 The key to achieving organizational goals consist in

determining the needs and wants of target markets and

delivering the desired satisfactions more effectively and
efficiently than competitors.

And build profit through customer satisfaction and loyalty

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 It is Marketing Concept (+) Societys well being.

Balancing of following three considerations while setting

marketing policies :
-Customers want satisfaction
-Societys well being
-Companys profits

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 The societal marketing concept holds that the

organizations task is to determine the needs, wants, and

interests of target markets and to deliver the desired
satisfactions more effectively and efficiently than
competitors in a way that preserves or enhances the
consumers and the societys well being.

Kisasembe Richard

SOCIETY
Human welfare

SOCIETAL
MARKETING
CONCEPT
CONSUMERS

COMPANY

Want satisfaction

Profits

Conflicts between consumer shot term wants

and consumer long-run welfare??
Kisasembe Richard

INTRODUCTION
Marketing for goods and marketing for services are the

same. Therefore, same techniques and strategies apply to

whether selling goods or services.

However, there are some issues which appear to be unique

to services and which require special attention

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 A product is anything that can be offered to a market for

attention, acquisition, use or consumption that might satisfy

a want or need. Includes physical objects, services, places,
organizations, and ideas

A service is any act or performance that one party can offer

to another that is essentially intangible and does not result in

the ownership of anything. Tied or not to good

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Banking, stock broking

Tourism

Lodging

Health care

Restaurants, bars, catering

Education

Insurance

Wholesaling and retailing

News and entertainment

Laundries, dry-cleaning

Transportation (freight and

passenger)

Repair and maintenance

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Professional (e.g., law,

architecture, consulting)

A companys offering to the market often includes some

products and some services.

The service components can be a minor or major part of

the total offering.

There are 5 categories of offerings;

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Pure
Tangible
Good

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Tangible
Good
w/
Services

Major
Pure
Hybrid Service Service
w/ Goods

There are 5 categories of

offerings;
1- Pure Tangible Goods:

The offering which consists primarily of

a tangible good with no services
accompany the product. For example:
Soap, salt, paper etc
2- Tangible with Accompanying Services:

The offering which consists of a

tangible good with one or more
services. For example: Nokia with
warranty
Kisasembe Richard

3- Hybrid:

The offering which consists of equal

part of good & services. For example:
Restaurants provide both food &
service.
4- Major Service with Accompanying Minor Goods/Service

The offering which consists of major

services along with additional services
or supporting goods. For example: Air travel is a

major service of travelling along with food, shopping on airport etc is

the accompanying minor goods.

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5- Pure Services:

The offering consist primarily of a

service. For example: a hair cut,
tailoring a suit etc.

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Services have four attributes that typically

distinguish them from goods:
Higher intangibility
Greater perishability
Inseparability of service from the service provider
Greater heterogeneity (variability) in quality

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1.

Intangibility

Services cannot be displayed, transported, stored,

packaged, or inspected before buying. They cannot be
seen, touched, heard, tasted, or smelt before they are
bought. You cant try it on, you cant return it if you dont
like it.

Example 1: a patient in psychiatric room cannot know the

outcome

Kisasembe Richard

 Example 2: Dar Express Bus passengers have nothing, but a

ticket and the promise that they and their luggage will arrive
safely and on time. Will they? Not sure

Because of service intangibility, service marketers are

challenged to tangibilize the intangible, i.e. to add physical

evidence and imagery to abstract offers

Kisasembe Richard

 Here normally, customers look at differences in price, place,

people, equipment, communications, symbols which they

can see.

Service marketing is always selling an idea. It must tell the

buyer clearly what the service will do, since it is unable to

demonstrate, illustrate, or display the service in use: Banks

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2. Inseparability
The service provider and his/her service may be inseparable,

whether the providers are people or machines

Since the customer is present as the service is produced,

provider-customer interaction is a special feature of service

marketing.

The services are typically produced and consumed

simultaneously. Service production and consumption are the

two sides of the same coin. Thus direct sale is the only
feasible channel of distribution

Kisasembe Richard

3. Heterogeneity (variability)
Quality of services depends on who provides them as well as

when, where, and how they are provided

E.g. College of African wildlife, mweka has reputation of high

student care in Tanzania. However, not all lecturers provide

the student care equally. The difference may vary according
to the state of mind at the time of each meeting with
students.

Kisasembe Richard

 The variability of services require marketers

to improve quality control through:

Good hiring and training procedures:

recruiting the right people and provide

them with excellent training

Standardizing the service-performance

process throughout the organization

Monitoring customer satisfaction through

customer complaints tracking tools.

Kisasembe Richard

4.Perishability;
Services cannot be stored for later sale or use. Once a

service is consumed, it disappears.

This

characteristic causes problems when demand is

fluctuating: there is a time when demand is overfull and
when it is low.

Bus tickets need be sold out before it moves

The challenge is to match the fluctuating demand with the

supply. Hire part-timers during peak, reservation/booking,

differential pricing, complementary services (ATMs), etc

Kisasembe Richard

Company
Company

External
Marketing

Internal
marketing

Employee

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Interactive
marketing

Customer

Service marketing require not only external marketing but

internal and interactive marketing.
External Marketing describe the normal work of preparing

pricing distributing and promoting the services to customer.

Internal Marketing describe the work to train and motivate

employees to serve customer.

Kisasembe Richard

 Interactive Marketing

describes the employees skill in

serving the clients because the client judges services not
only by technical quality but also its functional quality.

For Example: In hospital a successful operation is the

technical quality from the doctors, but the way the doctors
show their concerns and giving confidence to the patients is
the interactive marketing

Kisasembe Richard

1.

Economic risk- decision of potential customer whether

the product offer good value or not

2.

Physical risk-destinations may be perceived to be

dangerous owning to disease or crime

3.

Performance risk-feeling that the product may not

deliver the desired benefits

4.

Psychological risk-status can be lost through visiting

wrong country or travelling with a company that has a
poor image

Kisasembe Richard

 There are three types of service encounter

1. pre service encounter- it involve series of activities. It

is a time customer expectation is build

2. service encounter- customer start to measure whether

expectation are being met or not

3. post service start to encounter- customer evaluate hi

expectation

Kisasembe Richard

one way to differentiate is through

consistently higher quality service that
meets or exceeds customer
expectations (perceived versus
expected service)
Gaps that cause unsuccessful service
delivery

a.

Consumer expectation and management perception

b.

Management perception and service-quality

specification

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c.

Service quality specifications and service delivery

d.

Service delivery and external communications

e.

Perceived service and expected service

Determinants of service quality

Reliability
Responsiveness
Assurance
Empathy
Tangibles

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1. Understand environmental forces

2. Learn how demographic and economic

factors affect marketing

3. Identify trends in the firms natural and
technological environments
4. Explore key changes in political and
cultural environments
5. Realize how companies react to the
marketing environment
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 Its very important that an organization

considers its environment before beginning

the marketing process. In fact,
environmental analysis should be
continuous and feed all aspects of
planning.
Marketer in tourism companies need to
understand and adapt to changes in the
business environment
Both macro and Micro environmental
factors influence the marketing of tourism
business
Kisasembe Richard

Factors
Influencing
Companys
Marketing
Strategy

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INTERNAL FACTOR
MICROENVIRO
NMENT
These
are factors which are within
organization capability, These
include

Actors

Includes the actors close to the company

1. The company
2. Suppliers

3. Marketing

intermediaries
4. Customers
5. Competitors
6. Publics

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Marketing must consider

other parts of the
organization including
finance, R&D, purchasing,
operations and accounting
Marketing decisions must
relate to broader company
goals and strategies

MICROENVIRONMENT
Actors
1. The company
2. Suppliers

3. Marketing

intermediaries
4. Customers
5. Competitors
6. Publics

Kisasembe Richard

Marketers must watch

supply availability and
pricing
Effective partnership
relationship management
with suppliers is essential

MICROENVIRONMENT
Actors
1. The company
2. Suppliers

3. Marketing

intermediaries
4. Customers
5. Competitors
6. Publics

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Help to promote, sell and

distribute goods to final buyers
Include resellers, physical
distribution firms, marketing
services agencies and financial
intermediaries
Effective partner relationship
management is essential

MICROENVIRONMENT
Actors

The five types of customer

markets
Consumer

1. The company
2. Suppliers

3. Marketing

intermediaries
4. Customers
5. Competitors
6. Publics

Kisasembe Richard

Business
Reseller
Government
International

MICROENVIRONMENT
Actors
1. The company
2. Suppliers

3. Marketing

intermediaries
4. Customers
5. Competitors
6. Publics

Kisasembe Richard

Conducting competitor
analysis is critical for
success of the firm
A marketer must monitor
its competitors offerings to
create strategic advantage

MICROENVIRONMENT
Actors
1. The company
2. Suppliers

3. Marketing

intermediaries
4. Customers
5. Competitors
6. Publics

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A group that has an actual

or potential interest in or
impact on an organization
Seven publics include:

Financial
Media
Government
Citizen-action
Local
General
Internal

 The actors and forces outside marketing that affect

marketing managements ability to build and maintain

successful relationships with target customers

Social cultural
Economic
Natural

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Technological
Political

Consists of laws, government agencies and pressure

groups that influence or limit various organizations and
individuals in a given society
Legislation affecting businesses worldwide has increased
Laws protect companies, consumers and the interests of

society
Increased emphasis on socially responsible actions

Kisasembe Richard

You must consider issues such as:

1. How stable is the political environment?

2.Will government policy influence laws that
regulate or tax your business? E.g. Some
laws, gives us new oportunitys.
3.What
is the government's position on
marketing ethics? E.g.
4.What is the government's policy on the
economy?
5.Does the government have a view on culture
and religion?
6.Is
the government involved in trading
agreements such as EAC, SADC, or others?

Kisasembe Richard

Economic Factors.
Marketers need to consider the state of a trading economy in the
short and long-terms.
This is especially true when planning for international marketing.
You need to look at:
1. Interest rates.
2. The level of inflation and employment level. E.g.: In the last ten
years we had created more than 5 million of new employies
3. Long-term prospects for the economy Gross Domestic Product
(GDP) per capita, and so on.
4. factors that affect consumer buying power and spending
patterns = income changes, income distribution, classes,
changing consumer spending patterns

Kisasembe Richard

Sociocultural Factors.
The social and cultural influences on
business vary from country to country. It is
very important that such factors are
considered. Factors include:
1. What is the dominant religion?
2. What are attitudes to foreign products and
services?
In many sectors, some customer prefers
foreing products; but in bank, insurance,
tourism, food or health services, prefers
national products.
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3.Does language impact upon the diffusion of products onto

markets? E.g.: Our National language
4.How much time do consumers have for leisure? E.g.: The
long and split working days
5.What are the roles of men and women within society? E.g.:
Who take finally the last decission about buy a new car? The
promotion tools can't ignore this fact.

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6.

How long are the population living? Are the older

generations wealthy? E.g.: Nowdays, in TZ we have few
elderlyies and they have small pensions. Do the
population have a strong/weak opinion on green issues?

7.

human populations size, density, location, age, gender,

race, occupation

Kisasembe Richard

Technological Factors.
Technology is vital for competitive
advantage, and is a major driver of
globalization. Consider the following
points:

1.

Does technology allow for

products and services to be
made more cheaply and to a
better standard of quality?

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2.

Do the technologies offer consumers and businesses

more innovative products and services such as Internet
banking, new generation mobile telephones, etc?

3.

How is distribution changed by new technologies e.g.

books via the Internet, flight tickets, auctions, etc?

4.

Does technology offer companies a new way to

communicate with consumers e.g. Customer Relationship
Management (CRM), etc?

Kisasembe Richard

Natural Environment:
Involves the natural resources that are needed as inputs

by marketers or that are affected by marketing activities

Trends
Shortages of raw materials
Increased pollution
Increased government intervention

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Consumer Buying

Behavior

Learning Objectives

Understand the major factors influencing consumer

behavior

Understand the stages in the buying decision process

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Consists of all the

individuals and
households who buy or
acquire goods and
services for personal
consumption.
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 Consumer Buying Behavior refers

to the buying behavior of final

consumers (individuals &
households) who buy goods and
services for personal
consumption.
Study consumer behavior to
answer:
How do consumers respond to marketing
efforts the company might use?
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 In addition to a companys marketing mix and factors

present in the external environment, a buyer is also

influenced by personal characteristics and the process by
which he/she makes decisions

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Culture
Social
Personal
Psychological

Buyer
Buyer

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 Consumer behavior is deeply influenced by cultural factors

such as: buyer culture, subculture, and social class.

i. Culture
Basically, culture is the part of every society and is the

important cause of person wants and behavior.

The influence of culture on buying behavior varies from

country to country therefore marketers have to be very

careful in analyzing the culture of different groups, regions or
even countries. E.g African American Consumers,Asian
American Consumers

Kisasembe Richard

ii. Subculture
Each culture contains different subcultures such as religions,

nationalities, geographic regions, racial groups etc.

Marketers can use these groups by segmenting the market

into various small portions.

For example marketers can design products according to the

needs of a particular geographic group.

Kisasembe Richard

iii. Social Class

Every society possesses some form of social class which is

important to the marketers because the buying behavior of

people in a given social class is similar.

People within a social class

tend to exhibit
similar buying behavior. E.g Occupation,
Income, Education

In this way marketing activities could be tailored according

to different social classes.

Here we should note that social class is not only determined

by income but there are various other factors as well such

as: wealth, education, occupation etc.

Kisasembe Richard

Social factors also impact the buying behavior of consumers.

The important social factors are: reference groups, family,
role and status.
1 Reference Groups
Reference groups have potential in forming a person

attitude or behavior.

The impact of reference groups varies across products and

brands.

Kisasembe Richard

 For example if the product is visible such as dress, shoes, car

etc then the influence of reference groups will be high.

Reference groups also include opinion leader (a person who

influences other because of his special skill, knowledge or

other characteristics).

Kisasembe Richard

ii. Family
Buyer behavior is strongly influenced by the member of a

family. Therefore marketers are trying to find the roles and

influence of the husband, wife and children.

If the buying decision of a particular product is influenced by

wife then the marketers will try to target the women in their
advertisement.

Here we should note that buying roles change with change in

consumer lifestyles.

Kisasembe Richard

iii. Roles and Status

Each person possesses different roles and status in the

society depending upon the groups, clubs, family,

organization etc. to which he belongs.

For example if a woman is working in an organization as

finance manager. Now she is playing two roles, one of

finance manager and other of mother. Therefore her buying
decisions will be influenced by her role and status.

Kisasembe Richard

 Personal factors can also affect the consumer behavior.

Some of the important personal factors that influence the

buying behavior are: lifestyle, economic situation,

occupation, age, personality and self concept.

Kisasembe Richard

i. Age
Age and life-cycle have potential impact on the consumer

buying behavior.

It is obvious that the consumers change the purchase of

goods and services with the passage of time.

Family life-cycle consists of different stages such young

singles, married couples, unmarried couples etc which help

marketers to develop appropriate products for each stage.

Kisasembe Richard

ii. Occupation
The occupation of a person has significant impact on his

buying behavior.

For example a marketing manager of an organization will try

to purchase business suits, whereas a low level worker in the

same organization will purchase rugged work clothes.

Kisasembe Richard

iii. Economic Situation

Consumer economic situation has great influence on his

buying behavior.

If the income and savings of a customer is high then he will

purchase more expensive products.

On the other hand, a person with low income and savings will

purchase inexpensive products.

Kisasembe Richard

iv. Lifestyle
Lifestyle of customers is another import factor affecting the

consumer buying behavior.

Lifestyle refers to the way a person lives in a society and is

expressed by the things in his/her surroundings.

It is determined by customer interests, opinions, activities

etc and shapes his whole pattern of acting and interacting in

the world.

Kisasembe Richard

v. Personality

Personality changes from person to

person, time to time and place to place.

Therefore it can greatly influence the
buying behavior of customers.
Actually, Personality is not what one
wears; rather it is the totality of behavior
of a man in different circumstances.
It has different characteristics such as:
dominance, aggressiveness, selfconfidence etc which can be useful to
determine the consumer behavior for
particular product or service.

Kisasembe Richard

 There are four important psychological factors affecting

the consumer buying behavior. These are: perception,

motivation, learning, beliefs and attitudes.

Kisasembe Richard

i. Motivation
The level of motivation also affects the buying behavior of

customers.

Every person has different needs such as physiological needs,

biological needs, social needs etc.

The nature of the needs is that, some of them are most

pressing while others are least pressing.

Therefore a need becomes a motive when it is more pressing

to direct the person to seek satisfaction.

Kisasembe Richard

Self
Actualization

(Self-development)

Esteem Needs

(self-esteem, status)
Social Needs

(sense of belonging, love)

Safety Needs

(security, protection)

Physiological Needs
(hunger, thirst)

Kisasembe Richard

ii. Perception

The process by which an individual selects, organizes, and

interprets inputs to create a meaningful picture of the world.

Kisasembe Richard

iii. Beliefs and Attitudes

Customer possesses specific belief and attitude towards

various products.

Beliefs
Descriptive thoughts that a person holds about something

Attitudes
Enduring favorable or unfavorable cognitive evaluations emotional

feelings and action tendencies

Kisasembe Richard

 Since such beliefs and attitudes make up brand image and

affect consumer buying behavior therefore marketers are

interested in them.

Marketers can change the beliefs and attitudes of customers

by launching special campaigns in this regard

Kisasembe Richard

Need Recognition.
Information Search.
Evaluation of Alternatives.
Purchase Decision.
Postpurchase Behavior.

The
The Buyer
Buyer Decision
Decision Process
Process
Step
Step 1.
1. Need
Need Recognition
Recognition

Need
Need Recognition
Recognition

Difference
Difference between
between an
an actual
actual state
state and
and aa desired
desired state
state
Basically,
Basically, this
this is
is the
the point
point when
when aa buyer
buyer realizes
realizes what
what she
she
wants
wants is
is not
not what
what she
she has.
has.
This
This is
is the
the motive
motive that
that drives
drives people
people to
to seek
seek out
out products
products
and
and services.
services.

Internal
Internal Stimuli
Stimuli

External
External Stimuli
Stimuli

Hunger
Hunger

TV
TV advertising
advertising

Thirst
Thirst

Magazine
Magazine ad
ad

A
A persons
persons normal
normal
needs
needs
Kisasembe
Richard

Radio
Radio slogan
slogan

 When a consumer realizes that there is a need for a

product or service, the next step is to search for

information about possible solutions.
Thus, when a buyer wishes to travel to another country,
he may begin to call a travel agent or some airlines for
rate and schedule information.

Kisasembe Richard

Personal
Personal Sources
Sources

Family, friends, neighbors

Most influential source of
information

Commercial
Commercial Sources
Sources

Advertising, salespeople
Receives most information
from these sources

Public
Public Sources
Sources

Mass Media
Consumer-rating groups

Experiential
Experiential Sources
Sources

Kisasembe Richard

Handling the product

Examining the product
Using the product

 When a purchaser has identified a suitable number of alternatives

through the information search, she may begin to evaluate those

choices.

Past experience and references are very important here.

Kisasembe Richard

Product
ProductAttributes
Attributes

Evaluation
Evaluation of
of Quality,
Quality, Price,
Price, &
& Features
Features
Degree
Degreeof
ofImportance
Importance

Which
Which attributes
attributes matter
matter most
most to
to me?
me?
Brand
BrandBeliefs
Beliefs

What
What do
do II believe
believe about
about each
each available
available brand?
brand?
Total
TotalProduct
ProductSatisfaction
Satisfaction

Based
Based on
on what
what Im
Im looking
looking for,
for, how
how satisfied
satisfied
would
would II be
be with
with each
each product?
product?
Evaluation
EvaluationProcedures
Procedures

Kisasembe Richard

Choosing
Choosing aa product
product (and
(and brand)
brand) based
based on
on one
one
or
or more
more attributes.
attributes.

Purchase
Purchase Intention
Intention
Desire
Desire to
to buy
buy the
the most
most preferred
preferred brand
brand
ItIt is
is not
not until
until the
the fourth
fourth step
step that
that the
the
ctual
ctual purchase
purchase decision
decision is
is made.
made. And,
And, there
there is
is no
no guarantee
guarantee
that
that the
the purchase
purchase will
will actually
actually take
take place
place at
at this
this time.
time.
ItIt may
may be
be postponed
postponed for
for aa variety
variety of
of reasons.
reasons.
..
Attitude
s of
others

Kisasembe Richard

Unexpected
situational
factors

Purchase
Purchase Decision
Decision

The
The Buyer
Buyer Decision
Decision Process
Process
Step
Step 5.
5. Post
Post purchase
purchase Behavior
Behavior
Consumers
Consumers Expectations
Expectations of
of
Products
Products Performance
Performance

Products Perceive Performance

Satisfied
Satisfied
Customer!
Customer!
Kisasembe Richard

Dissatisfied
Dissatisfied
Customer
Customer
Cognitive dissonance

 Refers to dividing a market into distinct

groups with distinct needs,

characteristics, or behavior who might
require separate products or marketing
mixes.
According to Philip kotler , Market
segmentation is sub-dividing a market
into distinct and homogeneous
subgroups of customers, where any
group can conceivably be selected as a
target market to be met with distinct
marketing mix.
Kisasembe Richard

is a method of dividing a
market (Large) into smaller groupings of
consumers or organizations in which each
segment has a common characteristic such
as needs or behavior.

Market Segmentation

Segmenting Consumer Markets

1. Geographic
2.Demographic
3.Psychographic
4.Behavioral

Kisasembe Richard

1. Geographic segmentation divides

the market into different geographical

units such as nations, regions, states,
counties, or cities

2. Demographic segmentation

divides the market into groups based

on variables such as age, gender,
family size, family life cycle, income,
occupation, education, religion, race,
generation, and nationality

Kisasembe Richard

Demographic segmentation is the most popular

segmentation method because consumer needs, wants, and
usage often vary closely with demographic variables and are
easier to measure than other types of variables

3. Psychographic segmentation divides buyers into different

groups based on social class, lifestyle, or personality traits

4. Behavioral segmentation divides buyers

into groups based on their knowledge,
attitudes, uses, or responses to a product

Occasion
Benefits sought
User status
Usage rate
Loyalty status

Kisasembe Richard

Measurable
Size, purchasing power, and profile of segment
Accessible
Can be reached and served
Substantial
Large and profitable enough to serve
Differentiable
Respond differently
Actionable
Effective programs can be developed

Kisasembe Richard

Target Market

Consists of a set of buyers who

share common needs or

characteristics that the
company decides to serve

Kisasembe Richard

Selecting Target Market Segments

Undifferentiated (mass) marketing
Differentiated (segmented) marketing
Concentrated (niche) marketing
Micromarketing (local or individual)

Kisasembe Richard

How the target market perceives the

product offering
in
competitors brands.

comparison

to

Involves implanting the brands unique benefits and

differentiation in the customers mind.

Kisasembe Richard

Objectives
Understand how strategic planning is carried out at the

corporate, division, and business unit levels.

Learn the major steps in the marketing process.

Learn what type of content a marketing plan includes.
Understand how companies can effectively manage the

marketing process.

Kisasembe Richard

 Planning is widespread in business of all size

Large companies have more formalized planning process, but

smaller companies also perform planning essentials

Definitions
A planning can be thought of as a set of decisions about what a

company wants to achieve and how it is going to achieve it.

Planning (also called forethought) is the

process of thinking about and organizing the

activities required to achieve a desired goal

Kisasembe Richard

MARKETINGPLANNING:THEBASISFOR
STRATEGYANDTACTICS

PlanningProcessofanticipatingfutureevents
andconditionsandofdeterminingthebestway
toachieveorganizationalobjectives.

MarketingplanningImplementingplanning
activitiesdevotedtoachievingmarketing
objectives.

Kisasembe Richard

 STRATEGICPLANNINGVERSUSTACTICAL

PLANNING

StrategicplanningProcessofdeterminingan

organizationsprimaryobjectivesandadoptingcourses
ofactionthatwillachievetheseobjectives.

Provideslongtermdirectionfordecisionmakers.
TacticalplanningPlanningthatguidesthe

implementationofactivitiesspecifiedinthestrategic
plan.

Addressesshortertermactionsandcurrentnearterm

activities.

Kisasembe Richard

 The strategic marketing plan lays out the target markets

and the value proposition the firm will offer, based on an

analysis of the best market opportunities

The tactical marketing plan specifies the marketing

tactics, including product features, merchandising,

promotion, pricing, sales channels, and service,

Kisasembe Richard

 Strategic management is the highest of these levels in the

sense that it is the broadest - applying to all parts of the firm

- while also incorporating the longest time horizon.

It gives direction to corporate values, corporate culture,

corporate goals, and corporate missions.

Kisasembe Richard

Successful marketing require companies to have

capabilities such as
Understanding customer value
Creating customer value
Delivering customer value
Capturing customer value
And sustaining customer value

Kisasembe Richard

 Looks at the Big Picture

Leads to substantial changes
Considers future environmental forces in the Industry
Anticipates the reactions of competitors
Looks at a longer time horizon

Kisasembe Richard

 The essence of a plan, is therefore, a goal with

accompanying strategy and tactics.

The goal define what the company wants to achieve, while

the strategy and tactics set out how the goal will be achieved

A marketing plan sets out the marketing objectives that a

company wants to achieve and the strategy that will be used

to meet the objectives

Strategic planning takes place at the corporate, division,

business unit and product levels

Kisasembe Richard

Corporate Strategic Planning:

Defining the corporate mission Defining

the business Assessing growth

opportunities Organization and
organizational culture.

Business Strategic Planning:

Business mission SWOT analysis Goal

formulation Strategy formulation

Program formulation Implementation
Feedback and control.

Product/Marketing Strategic Planning:

Develop a marketing plan by following the

marketing process (e.g., value creation and

delivery process).

Kisasembe Richard

CORPORATE AND DIVISION

STRATEGIC PLANNING

Corporate strategy refers to the overarching strategy of

the diversified firm. Such a corporate strategy answers the

questions of "which businesses should we be in?" and "how
does being in these businesses create synergy and/or add to
the competitive advantage of the corporation as a whole?"

Kisasembe Richard

 Corporate headquarter is responsible for designing a

corporate strategic planning to guide the whole enterprise.

It makes decisions on the amount of resources to allocate to

each division, as well as on which businesses to start or

eliminate

Each division establishes a plan covering allocation of funds

to each business unit within a division

Kisasembe Richard

CORPORATE AND DIVISION

STRATEGIC PLANNING
Planning activities include:
Defining the Corporate Mission
Establishing Strategic Business Units

(SBUs),
Assigning Resources to SBUs
Planning New Businesses,
Downsizing Older Businesses
( assessing growth opportunities)
Kisasembe Richard

i. Mission statements define the companys

major competitive scopes:
Industry scope
Products and applications

scope

Competence scope

Market-segment scope
Geographical scope

What is our business, who are our customer, what is of value to

the customer, what will our business be
Kisasembe Richard

Mission statement explain:

Broad purposes of the organization
General criteria for assessing the long-term

organizational effectiveness

A company develop mission statement to share

with managers, employees, and in many cases

customers

Mission statement provide employee a shared

sense of purpose, direction, and opportunity

Mission statement should reflect a vision, an

almost impossible dream that provide direction

for the company for the next 10 to 20 years

Good mission should focus on limited number of

goals; major policies and culture, take long term

view; short, memorable and meaningful

 Rick dreams safaris is engaged in tour operation and

related businesses. It operates world-wide as the flag

carrier of the Republic of Tanzania, aiming to provide
services of the highest quality at reasonable prices for
customers and a profit for the company

Kisasembe Richard

Rick dreams Mission Statement:

We are committed to being the best lodging and food service
company in the world, by treating employees in ways that
create extraordinary customer service and shareholder value

Kisasembe Richard

ii.

Establishing strategic Business Units

Company often define their business in terms of products

e.g they are in clothing or tourism business

Strategic Business Units share three characteristics:

Single business or collection of businesses which can be

managed separately
Has own set of competitors
Has manager responsible for strategic planning and profits

Kisasembe Richard

CORPORATE AND DIVISION

STRATEGIC PLANNING
iii.

Assigning resources to each ABU

Once it has defined SBUs, management

must decide how to allocate corporate
resources to each

SBUs are treated as investment

portfolios. Resources are allocated by:

The BCG Growth-Share Matrix

Stars

Cash Cows

Question Marks

Dogs

Kisasembe Richard

BCG
BCG GROWTH-SHARE
GROWTH-SHARE MATRIX
MATRIX
Relative Market Share

Low

High

Market Growth Rate

High
Stars

High growth & share

Profit potential
May need heavy
investment to grow

Cash
Cash Cows
Cows

Low

Question
Question Marks
Marks
High
Highgrowth,
growth,low
lowshare
share
Build
into
Stars/
phase
Build into Stars/ phaseout
out
Requires
cash
to
hold
Requires cash to hold
market
marketshare
share

Dogs
Dogs

Low growth & share

Low
Lowgrowth,
growth,high
highshare
share Low growth & share
Low profit potential
Established,
Established,successful
successful Low profit potential
SBUs
SBUs
Produces
Producescash
cash

Kisasembe Richard

CORPORATE AND DIVISION

STRATEGIC PLANNING
Planning New Businesses and
Downsizing Old Businesses/Assessing
growth opportunities

iv.

Involves taking advantage of one or more of the following:

Intensive growth

Integrative growth

Diversification growth

Harvesting or divesting old businesses

Kisasembe Richard

2. BUSINESS UNIT STRATEGIC

PLANNING
Business strategy refers to the aggregated strategies of

single business firm or a strategic business unit (SBU) in a

diversified corporation.

Kisasembe Richard

BUSINESS UNIT STRATEGIC

PLANNING

Planning Involves Eight Steps:

Business Mission

Strategy Formulation

SWOT Analysis: Internal

Program Formulation

SWOT Analysis: External

Implementation

Goal Formulation

Feedback and Control

Kisasembe Richard

Mission (What is it we want?)

SWOT (Where are we now? )
Goals ( Where would we like to be?)
Strategies ( How do we get there?)
Program & implementation.
(How do we make sure
we get there?)
Evaluation and control
How do we know if
we got there?
Kisasembe Richard

 Each business unit needs to define its specific vision,

mission and sets of value within the broader company

mission

Vision- unfulfilled dreams of the company e.g Rickdreams

safaris aims to become the leading tour company in the

world

Mission statement- Why the organization exists, what is

offers

Kisasembe Richard

 E.g of mission statement To offer the highest standard of service to customers at all

time

To maximize profits through satisfying customer needs and

want effectively then competitors

Value statement- how the organization shall act in

relationships with its stakeholders, such as customer,

employees and communities

E.g offer quality service

Kisasembe Richard

Overall evaluation of a company's strengths , weakness,

opportunities, and threats

It is the way of evaluating internal and external

Kisasembe Richard

SWOT Analysis
Opportunities and

threats stemming
from the external
environment
Internal strengths
and weaknesses
Kisasembe Richard

Monitoring key

forces for trends

For each trend,
conduct an
MOA - Marketing
Opportunity
Analysis

SWOT Analysis
Opportunities and

threats stemming
from the external
environment
Internal strengths
and weaknesses
Kisasembe Richard

Brand awareness,

image, reputation
Distribution,
pricing, customer
loyalty, product
benefits
Finance, R&D,
manufacturing

 Effective goals should be formulated so that they are:

Arranged hierarchically from broader to

more specific objectives

Stated in quantitative terms
E.g to increase gross profit by 10% every
year during the planned period
To attract extra 100,000 visitors in year
one, 150,000 in year two, and 200,000 in
year three.
Realistic
Consistent with each other and the

company mission

Kisasembe Richard

 Strategy dictates the game plan for achieving goals.

According to Michael Porter, a firm must formulate a

business strategy that incorporates either cost

leadership, differentiation or focus in order to
achieve a sustainable competitive advantage and longterm success in its chosen areas or industries

Kisasembe Richard

 Cost leadership means using economies of scale and cost

efficiencies to become the lowest cost producer so that you

can either undercut competitors or charge similar prices to
competitors but achieve better profit margin

Product differentiation- developing and marketing the

product so different with from that of competitors, so the

price is no longer consideration

Kisasembe Richard

 Market focus- here the organization focus on to particular

market segment and try to achieve objective by becoming

market leader in the niche market.

Ansoofs matrix also looks on how the

product and market can be

manipulated and gives managers
four options

Kisasembe Richard

PRODUCT-MARKET
PRODUCT-MARKET EXPANSION
EXPANSION
GRID
GRID

Product-Market Expansion Grid

Current
Markets

Current
Products
1. Market
Penetration

New
Markets

2. Market
Development

Kisasembe Richard

New
Products
3. Product
Development
4. Diversification

 Strategies should be evaluating by looking at

Financial resources
Human resources
Physical resources such as equipment, building etc

Kisasembe Richard

 Developing supporting programs

Estimating implementation costs
Carefully managing the details so

great strategy isnt ruined by poor

implementation

Kisasembe Richard

 Marketing strategies are generally implemented through

marketing plans

Here marketing mix is manipulated through marketing plans

to achieve the aims of the organization marketing strategy

marketing mix consists of 7 Ps such price, products,

promotion, place, people, physical environment, and process

Kisasembe Richard

 Marketing plans are programmes of action which should

incorporate answers to the following questions

What will be done?

When will it be done?
What will it cost?
Who will do it?
How will it be measured?

Kisasembe Richard

Functional strategies include

marketing strategies
new product development strategies
human resource strategies
financial strategies
legal strategies
supply-chain strategies,
and information technology management
strategies.
Kisasembe Richard

 Working within the plans set by the levels above them,

product managers come up with a marketing plan for

individual product line, brands, channels or customer group.

Each product level whether product line or brand must

develop marketing plan for achieving its goal

The emphasis is on short and medium term plans and is

limited to the domain of each departments functional

responsibility.

Each functional department attempts to do its part in

meeting overall corporate objectives, and hence to some

extent their strategies are derived from broader corporate
strategies.

Kisasembe Richard

 A marketing plan is a written document that details the

necessary actions to achieve one or more marketing

objectives.

It can be for a product or service, a brand, or a product

line

It contains tactical guideline for the marketing programs

and financial allocations over the planning period

Kisasembe Richard

 All firms need marketing plans

In most small firms, marketing planning is an informal

exercise. However, in large professionally managed firms,

marketing planning is a formal exercise undertaken on
annual basis

There is no uniformity in the structures of marketing plans of

different companies

But, they have many contents in common

Kisasembe Richard

 Steps in the Marketing Process:

Analyzing market opportunities
Developing marketing strategies
Planning marketing programs
Managing the marketing effort

Kisasembe Richard

1.
2.
3.
4.
5.
6.
7.
8.

Title page
Executive summary and table of contents
Situation analysis / SWOT Analysis
Objectives
Marketing strategy
Implementation (action) programs
Financial projections
Control systems

Kisasembe Richard

 Executive summary is the overall birds eye view of the

marketing plan

It tells the focus of the plan, the objectives to be

achieved and the overall strategy. It is generally targeted

to the top management

Kisasembe Richard

 Top management is always busy and has no enough time to

go through all the facts and figures in the plan

Top management need to be told in a clear and concise

manner the thrust of the plan, the objectives to be achieved

and the overall strategy

A table of content should follow the executive summary.

Kisasembe Richard

 The situation analysis or situation audit is the first step of

any marketing plan.

SWOT analysis should be done. Issues like:

Where are we in terms of our sales, market share and

profitability?

Where are our competitors in terms of sales, market share

and profitability?

Kisasembe Richard

 What environmental factors helped or hindered our growth?

What will be the environmental factors in the future?
Briefly, this section will present relevant background data on

sales, costs, profits, the market, competitors, channels, and

the forces in the macro environment

Kisasembe Richard

Current Situation - Macroenvironment

i.

Competitive force
Economic force
legal /government
Technology force
Socio cultural
Natural force

Kisasembe Richard

Current Situation - Market Analysis

ii.

market definition
market size
market segmentation
industry structure and strategic
groupings
Porter 5 forces analysis
competition and market share
competitors' strengths and
weaknesses
market trends

Kisasembe Richard

Current Situation - Consumer Analysis

iii.

nature of the buying decision

participants
demographics
psychographics
buyer motivation and
expectations
loyalty segments

Kisasembe Richard

Current Situation - Internal

iv.

company resources
financial
people
time
skills

Kisasembe Richard

 Financial and marketing goals are expressed

Clearly defined, realistic but challenging objectives help

guide marketing and other functional teams to achieve

planned performance

e.g. Relative market share of the SBU, sales turnover of

the SBU, Profit of the SBU, Customer satisfaction, etc.

Kisasembe Richard

 Specific short tem targets should be expressed so that

progress toward achieving objectives can be measured

Objectives must be SMART

Compare: to increase sales and to increase sales by 15% in

the year within 12 months beginning May 1, 2011

The first objective is far too general but the second is

specific and measurable

Kisasembe Richard

 If the objectives are not achievable, subordinates may feel

frustrated to work toward impossible or highly unlikely

targets

MBO (management by objective) is usually used. This

involves all levels of management and frontline employees in

developing the objectives and in specifying means to
achieve them

Objectives have got levels- hierarchy.

Kisasembe Richard

 objectives
mission statement and vision

statement
corporate objectives
financial objective
marketing objectives
long term objectives
description of the basic business
philosophy

Kisasembe Richard

 Corporate: achieve a net profit growth rate

of 20% per year for the next 4 years

Target market: Increase the number of
regular customers by 15% in 12 months
Marketing: Increase market share for safari
walking from 12% to 16% during the next
24 months
Advertising: Increase consumer product
awareness from 40% to 60% in one year.
Salesperson: Increase sales volume by 25%
in 2007.
Kisasembe Richard

 Target markets are defined and broad marketing strategy

outlined

Its a game plan to accomplish the plans objectives

This stage consists of combining the 7 marketing Ps, into

a mix of strategies to achieve objectives in each target

market.

e.g. To achieve an increase in the firms sales turnover,

options include:

Kisasembe Richard

 Increase in the price of the product

Convert nonusers into users
Convert the competitors customers to firms customers
Increase consumption of the product or brand in existing

customer groups by identifying new use situation or new

applications of the existing product

Launch new pdts for different customer groups

Improvement in service strategy.

Kisasembe Richard

 Here, the strategy is converted into an

action plan i.e. the marketer creates

deadlines to achieve certain objectives,
develops action programs, and assigns
responsibilities to individuals.
This makes the entire plan more
meaningful
Each mktg strategy element must be
elaborated to answer questions: what will
be done? When? Who will do it? How
much will it cost? How will progress be
measured?
Kisasembe Richard

Marketing Strategy Product

i.

product mix
product strengths and weaknesses
product life cycle management and new product development
Brand name, brand image, and brand equity
the augmented product
product portfolio analysis

ii.

Marketing Strategy - segmented

iii.

marketing actions and market share objectives

by
by
by
by

product,
customer segment,
geographical market,
distribution channel.

Kisasembe Richard

Marketing Strategy - Price

iv.

pricing objectives
pricing method (eg.: cost plus, demand based, or competitor
indexing)
pricing strategy (eg.: skimming, or penetration)
discounts and allowances
price elasticity and customer sensitivity
break even analysis at various prices

Kisasembe Richard

Marketing Strategy - promotion

iv.

promotional goals
promotional mix
advertising reach, frequency, flights, theme, and media
sales force requirements, techniques, and management
sales promotion
publicity and public relations
electronic promotion (eg.: Web, or telephone)
word of mouth marketing (buzz)
viral marketing

Marketing Strategy - Distribution

v.

geographical coverage
distribution channels
physical distribution and logistics
electronic distribution

Kisasembe Richard

 The plan is meaningful when it has a statement of projected

or anticipated profit and loss

The revenues show forecasted sales in physical quantities

and average price, and the expenses show forecasted cost of

production, distribution and marketing

The budget is the basis for developing plans for material

procurement, production scheduling, recruitment, marketing

operations

Kisasembe Richard

 In order to ensure that performance is as per planned schedule, a

control system is set to help management take corrective mid

course action, if so required

In some firms, this involves quarterly, monthly, weekly, or daily

reports from field sales managers, product manager, advertising

managers, and market research data.

In other companies, contingency plans are

integrated in control system.

These plans become operational in
emergencies like a strike in the factory, a
dealer boycott, etc
A good marketer is one who is able to foresee
future scenarios and prepare himself/herself
adequately
Kisasembe Richard

 In writing a marketing plan, REMEMBER:

Establish your and/or department credibility
Document supporting facts
Be optimistic but always truthful
Emphasize uniqueness
Make sure that the plan is workable
Keep reviewing and updating the plan

Kisasembe Richard

 A marketing plan is to be successful only

when it is decided how the planning is to

be done
Four issues need to be addressed here:
(1) Participation: What individuals will be
responsible in developing the marketing
plan?
Marketing manager? Involve other
departments like sales, customer service
and finance? Use consultants and
marketing research groups?
Kisasembe Richard

 (2) Scheduling: Should planning be on

annual basis? It is better to do it frequently

in a year
(3) Review: Who reviews and approves the
proposed plan? What should the frequency
of review be? At the end of planning
period? Of the project?
(4) Monitoring: What is the best mechanism
to ensure that the plan is executed and
desired results are achieved?
Kisasembe Richard

Marketing planners need to avoid three

major pitfalls:
1. Improper fit between marketing
planning concepts and company culture
2. Systems and marketing reporting
formats being overplayed at the
expense of contents
3. Failure to recognize and consider
alternative and creative plans of action.

Kisasembe Richard

 The marketing mix is the combination of

variables that a business uses to carry out its

marketing strategy and meet customer needs.

The term marketing mix is used to describe

the tools that the marketer uses to influence

demand.
The marketing mix is core concept in
marketing
Marketing mix is done after marketing
analysis and identifying your target market.
Kisasembe Richard

Consist of 7ps
Product/service offer
Place/location
Price
Promotion
People,
Process, and
Physical environment. Marketing plan consists of four

strategies and some adopt eight strategies.

These are
These strategies must be integrated/ combine to reach

your targeted market.

Kisasembe Richard

PRODUCT
Product

refers to the functions and

features of a good or service

Should satisfy the needs of the customer

May have a Unique Selling Proposition (USP)
Product also includes a range of factors

such as packaging, quality, warranties,

after-sales service and branding

Kisasembe Richard

 There are two different dimensions for understanding tourism

products;

The overall tourism product; as far as the tourist is concerned,

the product covers the complete experience from the time he

leaves home to the time he returns to it.
The product of individual tourism businesses; organizations
in the industry have a much narrower view of the products they
sell, they focus primarily on their own services.

Kisasembe Richard

 From the standpoint of a potential

customer, the product may be defined as a

bundle or package of tangible and
intangible components.
The packaged is perceived by the tourist as
an experience.
1.
2.
3.
4.
5.

Destination attractions and environment

Destination facilities and services
Accessibility of the destination
Images of the destination
Price to the customer

Kisasembe Richard

 They determine customer choice and

influence prospective buyers motivations.

They include;
Natural attractions- landscape, climate flora and fauna etc
Built attractions-buildings and tourism infrastructure including

historic and modern architecture, monuments parks

Cultural attractions-history and folklore, religion and art, theatre,
parks, festivals etc
Social attractions- way of life and customs of residence, language etc

Kisasembe Richard

 They make it possible for visitors to stay and in other ways

enjoy and participate in attractions.

They include;
Accommodation units- hotels villas, campsite
Restaurants, bars and cafes
Transport at the destination-tax, coaches, car rental etc
Sports/adventure (interest) activity
Other facilities (e.g. language schools)-language school, health

clubs
Retail outlets-shops, travel agents, souvenirs
Other services (e.g. information services)

Kisasembe Richard

 These are the private and public transport aspects of the

product that determine the cost, speed and convenience.

They include;
Infrastructure (roads, airports, car parking etc)
Equipment (size, speed of transport etc)
Operational factors (routes operated, frequency of service, price

charged etc)
Government regulations-regulations

Kisasembe Richard

 The attitudes and images customers have towards

products strongly influence their buyer decision.

Destination images are not necessarily grounded in

experience or facts but they are always powerful

motivators in leisure and travel and tourism.

Closely linked in prospective customers minds.

Kisasembe Richard

 All destinations have images, often based

on historic rather than current events

It is an essential objective of destination

marketing to sustain, alter, or develop

images in order to influence prospective
buyers expectations.

The images of tourism businesses within

destinations are often closely related to the

destination image (e.g. Zanzibar,
Ngorongoro Crator )

Kisasembe Richard

 Most destinations offer a range of products and appeal to a

range of segments, price in the travel and tourism industry

covers a very wide range.

Price varies by season, by choice of activities and

internationally by exchange rates as well as by distance

traveled, transport mode and choice of facilities and
services.

Kisasembe Richard

There are three levels

Core Product
Tangible Product
Augmented product

Kisasembe Richard

Essential service or benefit designed to

satisfy the identified needs of target
customer segments.
The core product is the central component that supplies the
principal, problem solving benefit customer seek
These are often intangible and highly subjective attributes such as
atmosphere, experience, realization or convenience
E.g -airline or coaches = transportation

Kisasembe Richard

 The specific offer for sale stating what a customer will

receive for his money.

Examples: styling, quality, brand

name, design and Packaging etc.

Kisasembe Richard

 comprises all the forms of added value to the formal product

offers to make them more attractive.

All additional service and benefits the customer receives,

both tangible and intangible.

the add-ons that are extrinsic to the product itself but which

may influence the decision to purchase

It supplement the use of core product

Kisasembe Richard

 There are two kinds

1.Facilitating supplementary serviceaid in the use of the core product

Goods or services that must be
present for the guest to use the core
product e.g information, order taking,
billing, payment
2. Enhancing supplementary serviceadd extra value for customers e.g
consultation, Hospitality, safekeeping
etc
Kisasembe Richard

Kisasembe Richard

1.

Introduction

2.

Growth

3.

Maturity

4.

Decline (and death)

Need to revisit the marketing mix as a product moves

through its life cycle

Kisasembe Richard

Sales
Profits

Sales & Profits

Introduction

+
0
-

Kisasembe Richard

Growth

Maturity

Decline

Product
Product Item
Item

A
A specific
specific version
version of
of aa product
product
that
that can
can be
be designated
designated as
as aa
distinct
distinct offering
offering among
among an
an organizations
organizations
products.
products.

Product
Product Line
Line

A
A group
group of
of closely-related
closely-related
product
product items.
items.

Product
Product Mix
Mix

All
All products
products that
that an
an
organization
organization sells.
sells.

Kisasembe Richard

Factors affecting price

1.

Costs and expenses

2.

Supply and demand

3.

Consumer perception

4.

Competition

5.

Government regulation

6.

Technological trends

Kisasembe Richard

Factors affecting
price
Costs and expenses -to stay in business you have to make

profit. That means price must exceed costs and expenses used
in running of business

Supply and demand- if the demand of your product is high

and supply is low, you can command a high price. On the other
hand, if the reserve is true-low demand and high supply you will
have to set lower prices

Consumer perception- the price of your products helps create

your image in the mind of customers. For example the high

prices convey quality and status

Competition- your price will have to be competitive with similar

goods and services. Satisfy your customer than your

competetitors
by adding value
Kisasembe Richard

 Government regulation- the price can be affected by the

government policy and state laws

Technological trends- technology simplify job, application

of advanced technology may increase production and

easiest distribution

Kisasembe Richard

1.

Obtaining a target return on investment

2.

Obtaining market share

Other objectives include

3.

Social and ethical considerations

4.

Meeting the competitions prices

5.

Establishing an image

6.

survival

Kisasembe Richard

PRICE LEADERS AND TAKERS

Price leader businesses that dominate the market can
often dictate the price charged for a product. Other
businesses follow this lead.
Price taker businesses have to charge the market price.
This is often the case where there are many small firms
competing against each other.

Kisasembe Richard

PRICING STRATEGIES &

TACTICS
Skimming
Launching with a high price when there is little
competition, then reducing the price later. Often
used with technology.
Penetration

Low price charged initially to penetrate the

market and build brand loyalty; prrice is then
increased e.g. introductory offers on magazines.

Competitive

A similar price is charged to that of competitors

products.

Loss leader

Products may be sold at a price lower than the

cost to produce it. Often used by supermarkets
to encourage people into the store where it is
hoped they will buy other products.

Psychological

A price is set which customers perceive as lower

than it is e.g. 39.99 instead of 40.

Kisasembe Richard

1.

Flexible price Policy

2.

One price policy

Kisasembe Richard

 Break even point is reached when the money from the

product sale equals the costs of making and distributing the

product

This point will let you know how many unit you will have to

sell at a given price to make a profit.

Kisasembe Richard

To determine the number of unit you need to sell you

need to know three figures

1.

Fixed expenses, such as a rent utilities, and insurance

payments

2.

Variable expenses such as cost of the goods or services,

salaries, advertising expenses

3.

The selling price

Kisasembe Richard

 Break even point (units)=

BEP= Fixed expenses over

Unit sales price-Variable expenses
e.g Rick dreams Leisure and Travel Consultancy sells new product
for 500Tsh per unit. The cost per unit will be 300 Tsh. In order to
get enough stocks a company should buy 5000Tsh. How many
unit would you have to be sold at 500 for the company to break
even?
This equal to

5000
500-300
=25

PLACE
Products should be conveniently available for customers to

buy

Places include:
Stores
Mail order
Telesales
Internet

Kisasembe Richard

The use of
e-commerce
(promoting and selling
on the internet) has
grown massively over
the last few years

CHANNELS OF DISTRIBUTION
Manufacturers

Wholesaler

Retailer

Consumer

Kisasembe Richard

 Promotion -Is the process by which the marketer

develops and presents an appropriate set of

communications stimuli to a defined target audience with
the intention of eliciting a desired set of responses

Marcoms or simply Promotion is the function of

informing, persuading, and influencing a purchase

decision

Kisasembe Richard

INFORMING
Product Launch
phase
Explanations of
Products
features & benefits

TARGET
AUDIENCE

REMINDING
Product
Sales Growth phase
Competitive
positioning

PURSUADING
Product Maturity phase
Applies to consumers memory
(brand specific)
Kisasembe Richard

The promotion mix is the specific blend

of advertising, public relations, personal
selling, and direct-marketing tools that the
company uses to persuasively
communicate customer value and build
customer relationships
Personal selling - interpersonal
promotional process involving a sellers
face-to-face presentation to a prospective
buyer.
Nonpersonal selling - advertising, sales
promotion, direct marketing, and public
relations.

Kisasembe Richard

Advertising
Advertising
Personal
Personalselling
selling

Marketing
Marketing
Communications
Communications
mix
mix
(Promotion
(Promotionmix)
mix)

Sale
Salepromotion
promotion
Public
Publicrelations
relations
Direct
Directmarketing
marketing

Kisasembe Richard

Customer
Customer

Major Promotion Tools

Advertising is any paid form of non-personal

presentation and promotion of ideas,
goods, or services by an identified sponsor

Broadcast

Print

Internet

Outdoor

Major Promotion Tools

Sales promotion is the short-term

incentives to encourage the purchase
or sale of a product or service
Discounts
Coupons
Displays
Demonstrations

Major Promotion Tools

Public relations involves building good

relations with the companys various
publics by obtaining favorable publicity,
building up a good corporate image, and
handling or heading off unfavorable
rumors, stories, and events
Press releases
Sponsorships
Special events
Web pages

Major Promotion Tools

Personal selling is the personal

presentation by the firms sales force
for the purpose of making sales and
building customer relationships
Sales presentations
Trade shows
Incentive programs

Major Promotion Tools

Direct marketing involves making direct connections

with carefully targeted individual consumers to both
obtain an immediate response and cultivate lasting
customer relationshipsthrough the use of direct mail,
telephone, direct-response television, e-mail, and the
Internet to communicate directly with specific
consumers

Catalog

Telemarketing

Kiosks

 is the coordination of all promotional activitiesmedia

advertising, direct mail, personal selling, sales promotion,

and public relationsto produce a unified customerfocused message.

Kisasembe Richard

 People represent the business

The image they present can be important
First contact often human what is the lasting image they

provide to the customer?

Extent of training and knowledge
of the product/service concerned
Mission statement how relevant?
Do staff represent the desired culture
of the business?

Kisasembe Richard

 How do people consume services?

What processes do they have to go through to acquire

the services?

Where do they find the availability

of the service?
Contact
Reminders
Registration

Degree of technology

Kisasembe Richard

 The ambience, mood or physical

presentation of the environment ( internal

layout such as appropriate dcor, furniture,
and furnishing) and (intangible factors
such as the ambience, or atmosphere)
Smart/shabby?
Trendy/retro/modern/old fashioned?
Light/dark/bright/subdued?
Romantic/chic/loud?
Clean/dirty/unkempt/neat?
Music?
Smell?

Kisasembe Richard

 Marketing research is not the only

source of information that marketing

managers need in making decisions.
Information may also be generated by
various components of the Marketing
Information System (MIS) consisting of
a series of interactive components

Kisasembe Richard

 It consists of a continuing and interacting

structure of people, equipment, and

procedures- designed to gather, sort,
analyze, evaluate, and distribute
pertinent, timely, and accurate
information to marketing decision makers
The MIS is concerned with managing the
flow of data- from many different projects
and secondary sources to the marketing
managers who will use them.
Kisasembe Richard

 The MIS requires:

databases to organize and store the

information and
a decision support system (DSS) to
retrieve data, transform it into usable
information, and disseminate it to
users

Kisasembe Richard

 A database is a customer- or salesperson, or product- list

to which has been added information about the

characteristics and the transactions of these customers
(salespeople, products)

To understand database marketing the following

questions can be asked: (i) who are my customers? (ii)

how loyal are my customers?

Kisasembe Richard

 A marketing database can collect, and manipulate

information on customers, their individual characteristics,

and their response characteristics

With databases, marketers can use past actions by

customer to project additional sales

Care must be taken to ensure accuracy, relevance, and

currency of the information.

Kisasembe Richard

 MIS contains three types of info: (i) recurring day-to-day

information( Internal reports), (ii) intelligence relevant to

the future of organization, (iii) research studies that are
not of recurring nature

(i)recurring day-to-day information: e.g. sales and

accounting information is needed every day

Kisasembe Richard

This information is organized in

databases- customer databases,

product databases, salesperson
databases, dealer databases, etc

Kisasembe Richard

 (ii) intelligence relevant to the future strategy

of the business
This information might come from scientific
meetings, trade organizations, or perhaps
from government reports
It also might include information from
salespersons or dealers about new-product
tests being conducted by competitive firms
In summary, a system information intelligence
is everyday information about developments
in the marketing environment.
Kisasembe Richard

 Intelligence information is difficult to develop: it

involves diverse and changing topics and

information sources

To solve this problem, options include

Training and motivate your salespeople to spot and

collect new developments

Motivate your distributors, retailers, and other

intermediaries to transmit needed intelligence

Hire specialists to gather mktg intelligence

Collect competitive intelligence: purchase

competitors products, attending trade shows,

competitors reports, talking to employees, dealers,
etc
Kisasembe Richard

 Set up a customer advisory panel made up of

representative or largest customers

Purchase information from outside firms

(iii) research studies that are not of recurring nature.

Details later.

Kisasembe Richard

Remember the goal of marketing

concept: being consumer and

competitor oriented
The business environment is
always posing problems and
opportunities to businesses. Each
problem and opportunity requires
a Relevant, Accurate, and Timely
(RAT) information.
Kisasembe Richard

 Many definitions of Marketing Research:

Marketing research is the systematic

design, collection, analysis and

reporting of data and findings relevant
to a specific marketing situation facing
the company. [Philip Kotler
the systematic gathering, recording
and analyzing of all data about
problems relating to the marketing of
goods and services. [The American
Marketing Association]
Kisasembe Richard

 Basic Purpose of Marketing Research

Marketing research reduces

uncertainty or error in decisionmaking.

The information collected by
conducting marketing research is
used for problem solving and
decision making in various areas of
marketing.

Kisasembe Richard

Types of Marketing Research

M a r k e t in g R e s e a r c h
R e s e a rc h B a s e d o n
P u rp o s e

P r e lim in a r y
Kisasembe Richard

R e s e a rc h B a s e d o n
S o u rc e o f D a ta

R e s e a rc h B a s e d o n
D a t a C o lle c t io n M e t h o d

B a s ic R e s e a r c h

P r im a r y R e s e a r c h

Q u a lit a t iv e R e s e a r c h

A p p lie d R e s e a r c h

S e c o n d a ry R e s e a rc h

Q u a n t it a t iv e R e s e a r c h

C o n c lu s iv e

P e r fo r m a n c e

M A R K E T IN G R E S E A R C H

Q U A L IT A T IV E R E S E A R C H
EXPLO RATO RY
F o c u s G ro u p ;
O b s e rv a tio n ;
O th e rs .
Kisasembe Richard

Q U A N T IT A T IV E R E S E A R C H
D E S C R IP T IV E
S u r v e y re s e a rc h

CAUSAL
L a b o ra to ry E x p e rim e n t
F ie ld E x p e rim e n t

Can help the marketing manager to:

Identify and define marketing

problems and opportunities
accurately;

(1)

(2) Understand markets and customers

and offer reliable prediction about
them;

Kisasembe Richard

(3) Develop marketing strategies and actions to provide a

competitive edge; and refine and evaluate them;
(4) Facilitate efficient expenditure of funds;
(5) Monitor marketing performance; and
(6)Improve the understanding of marketing as a process.

Kisasembe Richard

1. Market and Sales Research

2. Product Research
3. Price Research
4. Distribution (Place)
Research
5. Promotion Research.
Kisasembe Richard

Marketing Research

Product
Research

Kisasembe Richard

Customer
Research

Pricing
Research

Sales
Research

Promotion
Research

1. Define the Problem

2. Establish Research Objective
3. Determine Research Design
4. Identify Information Needs and Sources
5. Determine Methods of Data Collection

Kisasembe Richard

6. Design Instrument for Data Collection

7. Determine Sample Plan and Sample Size
8. Collect Data
9. Analyze Data
10. Prepare and Present Final Report

Kisasembe Richard