HOSPITALITY MARKETING

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HOSPITALITYMARKETING
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• CHAPTER 1
• MARKETING AN OVERVIEW
• Definition of Marketing
• Marketing Activities
• Marketing Management
• Marketing Environment

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• Marketing affects everyone
• Consumers
• Business organizations
• Nonbusiness (nonprofit) organizations
• Government
• Academicians

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• Marketing is the process of planning and
  executing the conception,
• pricing, promotion, and distribution of ideas,
  goods, and services
• to create exchanges that satisfy individual and
  organizational
• objectives.

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• Marketing is a game played by an enterprise with
  the participation of consumers which rules are
  dertermined by macro environmental forces and
  leaded by micro environmental forces

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• MARKETING ENVIRONMENT
• Micro environmental variables
• Internal environment
• Top management
• Production
• Finance
• Research and development
• External environment
• Markets
• Suppliers
• Intermediaries
• Competitors
• Public

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• Macro environmental variables
• Demographic forces
• Economic forces
• Ecological forces
• Technological forces
• Political forces
• Cultural forces

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• Major implications of definition
• The purpose of marketing is to satisfy human
  needs and wants.
• Marketing facilitates and creates exchanges.
• Marketing consists of various activities.
• Marketing is performed by individuals and
  organizations.
• Marketing occurs in a dynamic environment.
• Marketing activities should be planned,
  organized, coordinated, executed, and controlled.

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• Understanding Marketing Terms
• Needs, wants, and demands.
• Products.
• Value, satisfaction, and quality.
• Exchange, transactions, and relationships.
• Markets.

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• Needs, Wants, and Demands
• Needs A state of felt deprivation.
• Physical, social, esteem, individual.
• Wants How people communicate their needs shaped
  by culture and individual personality.
• Demands Wants that are backed by buying power.
• Products
• Anything that can be offered to a market for
  attention, acquisition, use or consumption and
  that might satisfy a need or want.

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• Value
• Customer value is the difference between the
  benefits that the customer gains from owning or
  using a product and the cost of obtaining the
  product.
• Satisfaction
• Customer satisfaction depends on products
  perceived performance in delivering value
  relative to a buyers expectations.
• Quality
• The totality of features and characteristics of a
  product that bear upon its ability to meet
  customer needs.

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• Exchange
• The act of obtaining a desired object from
  someone by offering something in return.
• Transactions
• A trade of values between two parties and
  marketings unit of measurement.
• Relationship marketing
• Focuses on building a relationship with a
  organizations profitable customers.
• Markets
• A set of actual and potential buyers who might
  transact with a seller.

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Core Marketing Concepts
Needs, wants, and demands
Products and services
Markets
Exchange, transactions, and relationships
Value, satisfaction, and quality
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• Marketings Future
• Manufacturing concept ,Product concept, Selling
  concept, Marketing concept, Societal marketing
  concept, SOCIAL MEDIA AGE
• Rapid globalization resulting in a vastly more
  complex marketing environment.
• Greater focus needed on satisfying customers.
• Marketing must encompass the entire business all
  departments are becoming involved in satisfying
  the customer.

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• Chapter 2Service Characteristics of Hospitality
  and Tourism Marketing
• A service culture
• Characteristics of service marketing
  (intangibility, inseparability, variability,
  perishability)
• Management strategies for service businesses

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• A Service Culture
• The service culture focuses on serving and
  satisfying the customer.
• Service culture has to start with top management
  and flow down.
• A service culture empowers employees to solve
  customer problems.
• Organizations culture must support and reward
  customer need attention.

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• Four Characteristics of Services
• 1. Intangibility
• Services cannot be seen, tasted, felt, heard, or
  smelled before they are purchased.
• Buyers look for tangible evidence that will
  provide information and confidence about the
  service.

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• Four Characteristics of Services
• 2. Inseparability
• Customer-contact employees are part of the
  product.
• Customers are part of the product.
• Customers and employees must understand the
  service delivery system.

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• Four Characteristics of Services
• 3. Variability
• Services are highly variable.
• Services are produced and consumed at the same
  time which limits quality control.
• Fluctuating demand makes it difficult to deliver
  consistent quality during periods of peak demand.
• Lack of consistency a major source of customer
  disappointment.

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• Four Characteristics of Services
• 4. Perishability
• Services cannot be stored.
• Capacity and demand must be managed since unsold
  inventory cannot be carried forward.

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Three Types of Marketing in Service Industries
(Figure 2-2)

• External marketing company and customers
• Internal marketing company and employees
• Interactive marketing employees and customers

Company
External marketing
Internal marketing
Employees
Customers
Interactive marketing
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• Internal marketing means that the service firm
  must effectively train and motivate its
  customer-contact employees and all the supporting
  service personnel to work as a team to provide
  customer satisfaction.
• Interactive marketing means that perceived
  service quality depends heavily on the quality of
  the buyer-seller interaction during service
  encounter.

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• Management Strategies for Service Businesses
• 1. Managing Differentiation
• Price Competition referred companies to develop a
  differentiated offer, delivery, and image.
• Offer innovative features (e.g., British Airways
  sleeping compartment, hot showers, and
  cooked-to-order breakfasts).
• Differentiate service delivery through 1)
  people 2) physical environment and 3) process.

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• Management Strategies for Service Businesses
• 2. Managing Service Quality
• The key is to exceed the customers
  service-quality expectations.
• The first step is to empower frontline service
  employees to give them the authority,
  responsibility and incentives they need to
  recognize and tend to customer needs.
• Develop a set of common virtues regarding service
  quality.
• Watch service performance closely (both our own
  and competitors)

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• Management Strategies for Service Businesses
• 3. Tangibilizing the Product
• Promotional material, employees appearance, and
  the service firms physical environment all
  assist in tangibilizing the service.
• Trade dress (the distinctive nature of a
  companys total visual image and overall
  appearance)

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• Management Strategies for Service Businesses
• 4. Managing the Physical Surroundings
• Physical evidence that is not managed properly
  can hurt a business. (signs with missing letters,
  burned out lights, employees in dirty uniforms,
  messy workstations)
• Physical surroundings should be designed to
  reinforce the products position (organization
  image) in the customers mind.
• 5. Stress Advantages of Nonownership
• In a service the customer does not have ownership
  of the product. Lack of ownership, sometimes
  cited as a major characteristics of a service can
  be stressed as a benefit.

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• Management Strategies for Service Businesses
• 6. Managing Employees as Part of the Product
• In the hospitality, employees are a critical part
  of the product and marketing mix.
• Human resources and marketing departments must
  work closely together.
• Must manage service at the points of encounter
• A point of encounter is any point at which an
  employee encounters the customer.

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• Management Strategies for Service Businesses
• 7. Managing Perceived Risk
• Customers experience some anxiety before they
  purchase hospitality and tourism services because
  they can not experience the product beforehand.
• Customer loyalty increases for companies that
  have provided a consistent product in the past.

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• Management Strategies for Service Businesses
• 8. Managing Consistency
• Consistency means that customers receive the
  expected product without unwanted surprises.
• It is not a simple task to accomplish many
  factors work against consistency such as unclear
  company policy, fluctuating demand.

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• Chapter 3The Marketing Environment
• The company operates in a complex marketing
  environment, consisting of uncontrollable forces
  to which the company must adapt.
• The environment produces both threats and
  opportunities. The company must carefully analyze
  its environment so that it can avoid the threats
  and take advantage of the opportunities.

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• The marketing environment is made up of a
  microenvironment and a macro environment.
• The microenvironment consists of actors and
  forces close to the company that can affect its
  ability to serve its customers.
• The macroenvironment consists of the larger
  societal forces that affect the whole
  microenvironment demographic, economic, natural,
  technological, political, competitor, and
  cultural forces.

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THE COMPANYS MICRO-ENVIRONMENT The actors in the
microenvironment include the company, suppliers,
market intermediaries, customers, and publics.
Marketing Intermediaries
Customers
Suppliers
Company
Competitors
Publics
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• THE COMPANY
• Marketing managers work closely with top
  management and the various company departments.
  All company departments will have some impact on
  the success of marketing plans.
• Housekeeping is responsible for delivering clean
  rooms sold by the sales department,
• The accounting department has to measure revenues
  and costs to help marketing know how well it is
  achieving its objectives etc.

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MARKETING INTERMEDIARIES Marketing intermediaries
include travel agents, wholesale tour operators,
middlemen, physical distribution firms,
marketing-service agencies, financial
intermediaries and hotel representatives. They
help the company promote, sell, and distribute
its goods to final buyers. Marketing services
agencies include public relations agencies,
advertising agencies, and direct mail houses.
They work directly with the companys marketing
consulting firms which help companies target and
promote their products to the right
markets. Financial intermediaries include banks,
credit companies, insurance companies etc. They
help hospitality companies finance their
transactions or insure the risks associated with
the buying and selling of goods and services.
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THE COMPANYS MACROENVIRONMENT The
macroenvironment consists of the seven major
forces
Compatitive Forces
Economic Forces
Technological Forces
Cultural Forces
Natural Forces
Demographic Forces
Political Forces
Company
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1-COMPETITIVE ENVIRONMENT Each firm must consider
its size and industry position in relation to its
competitors. Both large and small firms must find
marketing strategies that give them specific
advantages over competitors operating in their
markets. In general a company should monitor
three variables when analyzing each of its
competitors Share of market The competitors
share of the target market. Share of mind The
percentage of customers who named the competitor
in responding to the statement, Name the first
company that comes to mind in this
industry. Share of heart The percentage of
customers who named the competitor in responding
to the statement, Name the company from whom you
would prefer to buy the product.
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Every company faces four levels of
competitors 1-Product form competition A
company can view its competitors as other
companies that offer similar price. At this
level, McDonalds will view its competition as
Burger King, Wendys, and Hardees. 2-Product
category competition A company can see its
competitors as all companies making the same
product or class of products. Here McDonalds may
see its competition as all fast-food
restaurant. 3-General competition A company can
see its competitors more broadly as all companies
supplying the same service. Here McDonalds would
see itself competing with all restaurants and
other suppliers of prepared food. 4- Budget
competition A company can view its competition
even more broadly as all companies that compete
for the same consumer dollars. Here McDonalds
may see itself competing with grocery stores and
the self provision of the meal by the consumer.
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2- DEMOGRAPHIC ENVIRONMENT Demography is the
study of human populations in terms of size,
density, location, age, sex, race, occupation,
and other statistics. The demographic environment
is of major interest to marketers because markets
are made up of people. a) Changing Age Structure
of the Population The age distribution is
rapidly assuming. Two very large age groups, the
baby boomer generation and the echo boomer,
surround the smaller Generation X. -The Baby
Boomers The post-World War II baby boom produced
78 million baby boomers born between 1946 and
1964. Since then, the baby boomers have become
one of the most powerful forces shaping the
marketing environment. Todays baby boomers
account for about 30 percent of the population
but earn more than half of all personal income.
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They will spend billions of dollars on travel,
looking for active vacations, where they can have
adventure or explore, such as historical and
cultural tours of Europe. They are approaching
life with a new stability and reasonableness in
the way they live, think, eat, and spend. As they
continue to age, they will create a large and
important seniors market. By 2025, there will be
64 million baby boomers aged 61 to 79, a 90
percent increase in the size of this population
from today. -Generation X The baby boom was
followed by a birth dearth, creating a
generation of 45 million people born between 1965
and 1976. The GenXers are defined as much by
their shared experiences as by their age. They
are a more skeptical bunch, cynical of frivolous
marketing pitches that promise easy success. They
like lower prices and a more functional look.
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GenXers share new cultural concerns. They care
about the environment and respond favorably to
socially responsible companies. They represent
125 billion in annual purchasing power. By the
year 2010, they will have overtaken the baby
boomers as a primary market for almost every
product category. -The Echo Boomers Born between
1977 and 1994, these children of the baby boomers
now number 72 million. The echo boomers has
created large and growing kids and teens
markets. One distinguishing characteristic of
the echo boomers is their utter fluency and
comfort with computer, digital, and Internet
technology.
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The generation born after the year 1994 until
2004 is referred to as Generation Z. There is
interest in this generation as in another few
years the members will be joining the workforce
and contributing to the economy of the country
and the society. This is the first generation to
be born with complete technology. They were born
with PCs, mobile phones, gaming devices, MP3
players and the internet. They do not know life
without technology. This reliance on technology
and gadgets has had a negative effect on the
members. They rather stay indoors and use their
electronics than play outdoors and be active.
They are leading a sedentary life that can result
in health problems later on. it is a known fact
that this generation has it all time high in
obesity. For them ,social media platforms are a
way to communicate with the outside world. They
are not bothered about privacy and are willing to
share intimate details about themselves with
complete strangers. They have virtual friends and
for them hanging out with friends means talking
to them over the cell phones, emails and text
messages.
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This generation is considered to highly creative
and collaborative and will have a significant
impact on the way companies work when they join
the workforce. They wont have any communication
skill they will just have technology skills. When
they get to be working age, they will change the
workplace dramatically in terms of style and
expectations. To keep going the next step is
Multitasking. They can text, read, watch, talk
and eat all at the same time, a talent that stuns
adults. With this preference toward multitasking
comes a dark side, which mental health experts
are calling "acquired attention deficit
disorder. While they are able to complete many
tasks at once, each task gets divided attention,
and the generation is losing the ability to focus
and analyze more lengthy, complex information.
The last characteristic is speedy. Speedy is a
short attention span, perhaps brought on by the
tendency to multitask, also requires information
to be delivered in rapid, short bursts if it is
to be understood. Generation Z thrives on instant
gratification. This is why classes are so short
and the breaks on so long.
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b) Changing Family Style The traditional
household consists of a husband, wife, and
children (sometimes grandparents). But now, more
people are divorcing or separating, choosing not
to mary, marrying later, or marrying without time
intention to have children. Marketers must
increasingly consider needs of nontraditional
households, because they are now growing more
rapidly than traditional households. The number
of working women has also increased greatly. This
trend has spawned the child day care business and
increased consumption of convenience foods and
services, career-oriented womens clothing,
financial services, and many other business
opportunities.
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c)Geographic Shifts in Population This is a
period of great migratory movements between and
within countries. The population shifts interest
marketers because people in different regions buy
differently. Today, people are moving to
micropolitan areas small cities located beyond
congested metropolitan areas. These smaller
micros offer many of the advantages of metro
areas-jobs, restaurants, diversions, community
organizations- but without the population crush,
traffic jams, high crime rates, and high property
taxes often associated with heavily urbanized
areas.
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3- ECONOMIC ENVIRONMENT The economic environment
consists of factors that affect consumer
purchasing power and spending patterns.
Purchasing power depends on current income,
price, saving and credit marketers must be aware
of major economic trends in income and changing
consumer spending patterns. Whereas demographic
and cultural trends generally affect the size and
needs of various markets, economic trends affect
the purchasing power of these markets. Changes in
Income Marketers should pay attention to income
distribution as well as average income. There is
a comfortable middle class that is somewhat
careful about its spending but can still afford
the good life of the time. The working class must
stick close to the basics of food, clothing, and
shelter and must try hard to save. Finally, the
underclass (persons on welfare and many retirees)
must count their pennies when making even the
most basic purchases.
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Changes Consumer Spending Patterns Changes in
major economic variables such as income, cost of
living, interest rates, and savings and borrowing
patterns have a large impact on the marketplace.
Companies use economic forecasting to anticipate
changes in these variables. With adequate
warning, businesses can reduce their costs and
adjust their marketing mix to ride out the
economic storm. Restaurants, for example, can
vary their menus and offer a number of
lower-priced entrees during a recession. Global
Economic Patterns With many markets in Europe
saturated with hotels, companies are looking to
other global markets. As a regions economy
develops, demand is created for lodging and food
facilities. The global growth creates many
opportunities however it also greatly increases
the complexity of the macroenvironmental forces.
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4- NATURAL ENVIRONMENT The natural environment
consists of natural resources required by
marketers or affected by marketing activities.
Communities are finding that preserving the
natural environment can be good for tourism. Hong
Kong, for example, saw the coming of Disneyland
as a chance to improve its natural environment.
One way of protecting the environment is to
recycle and reduce waste. Disney has an
aggressive program to reduce waste. Disney World
shreds its paper products and sends the shredded
paper to the gift shops to use as packing
material.
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5- TECHNOLOGICAL ENVIRONMENT Technology has
affected the hospitality industry in many ways
Technology is having an impact on hotel room
amenities. Many business class hotels have a
combination fax machine, printer, and copier in
each room. Also, machines cook food
automatically, eliminating human error.
Computerized video checkout services are now
common in many hotels. Electronic guest room
locking systems tells which guests accessed their
mini bar, making restocking easier. Technology
has also made communication easier. The Internet
has had a profound effect on the hospitality and
travel industries. The Internet has created a new
distribution channel for hospitality and travel
products. Most hotel, rent a car companies, and
hotel chains have set up their own on-line
reservation systems, allowing the guest to book
directly on line.
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• 6- POLITICAL ENVIRONMENT
• The political environment is made up of laws,
  government agencies, and pressure groups that
  influence and limit the activities of various
  organizations and individuals in society. There
  are some current political trends that affect the
  marketing management
• Increased Legislation and Regulation Affecting
  Business
• International Legislation
• Government Intervention in Natural Resource
  Management
• Growth of Public-Interest Groups
• Increased Emphasis on Ethics and Socially
  Responsible Actions

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7- CULTURAL ENVIRONMENT The cultural environment
includes institutions and other forces that
affect societys basic values, perceptions,
preferences, and behaviors. The following
cultural characteristics can affect marketing
decision making. People in any society hold
certain persisting core beliefs and values. Core
beliefs and values are passed are on from parents
to children and are reinforced by schools,
churches, business, and governments. Secondary
beliefs and values, however, are more open to
change. Believing in marriage is a core belief
believing that people should get married early is
a secondary belief. Marketers have some chance of
changing secondary values, but little chance of
changing core values.
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RESPONDING TO THE MARKETING ENVIRONMENT Many
companies view the marketing environment as an
uncontrollable element to which they must
adapt. They passively accept the marketing
environment and do not try to change it. Other
companies take an environmental management
perspective. Rather than simply watching and
reacting, these firms take aggressive action to
affect the publics and forces in their marketing
environment.
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• Chapter 4
• CONSUMER MARKETS CONSUMER BUYING BEHAVIOR
• Buying behavior is never simple. It is affected
  by many different factors and understanding it is
  the essential task of marketing management. The
  basic beliefs about consumer behavior can be
  summarized into five premises
• Consumer behavior is purposeful and goal
  oriented.
• The consumer has free choice.
• Consumer behavior is a process.
• Consumer behavior can be influenced.
• There is a need for consumer education.

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• Todays marketplace has become very competitive.
  In addition, during recent years the hospitality
  and travel industries have undergone
  globalization. The result is a fiercely
  competitive international market with companies
  fighting for their share of consumers.
• The central question is How do consumers respond
  to the various marketing stimuli that a company
  might use. The company that really understands
  how consumers will respond to different product
  features, prices and advertising appeals has a
  great advantage over its competitors. Researchers
  from companies have heavily studied the
  relationship between marketing stimuli and
  consumer response.
• The figure below shows the model of buyer
  behavior. In the figure, marketing and other
  stimuli enter the consumers black box and
  produce certain responses.

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Factors influencing behavior
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• Cultural Factors
• Cultural factors exert the broadest and deepest
  influence on consumer behavior.
• Culture
• Culture is the most basic determinant of a
  persons wants and behavior. It comprises the
  basic values, perceptions, wants, and behaviors
  that a person learns continuously in a society.
  Culture is an integral part of the hospitality
  and travel business.
• For companies operating in many countries,
  understanding and serving the needs of can be
  very difficult. Although consumers in different
  countries may have some things in common, their
  values, attitudes, and behaviors often vary
  dramatically. Failing to understand such
  differences in customs and behaviors from one
  country to another can spell disaster for a
  companys international products and programs.
  Marketers must decide on the degree to which they
  will adapt their products and marketing programs
  to meet the unique needs of consumers in various
  markets.

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• Social Class
• Social classes are relatively permanent and
  ordered divisions in a society whose members
  share similar values, interests and behaviors.
  Social scientists have identified the seven
  American social classes upper uppers (less than
  1), lower uppers (2), upper middles (12),
  middle (32), working (38), upper lowers
  (9),and lower lowers (7).
• Marketers interested in social class because
  people within a given class tend to exhibit
  similar behavior, including buying behavior.

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• Social Factors
• Consumer behavior is also influenced by social
  factors, including the consumers groups, family,
  social roles, and status.
• Groups
• An individuals attitudes and behavior are
  influenced by many small groups. Those to which
  the person belongs that have a direct influence
  are called membership groups. Primary groups are
  those with whom there is regular but informal
  interaction such as family, friends, neighbors
  and co-workers. Secondary groups are more formal
  and less regular interaction they include
  religious groups, Professional associations, and
  trade unions.
• Reference groups influence consumers in at least
  three ways
• 1-They expose the person new behaviors and
  lifestyles.
• 2-They influence the persons attitudes and
  self-concept
• 3-They create pressures to conform that may
  affect the persons product

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• Family
• Family members have a strong influence on buyer
  behavior. The family remains the most important
  consumer buying organization in the society.
• Roles and Status
• A person belongs to many groups family, clubs
  and organizations. An individuals position in
  each group can be defined in terms of role and
  status. A role consists of the activities that a
  person is expected to perform according to the
  persons around him or her. Each role carries a
  status reflecting the general esteem given to it
  by society. People often choose products that
  show their status in the society

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• Personal Factors
• A buyers decisions are also influenced by
  personal characteristics such as age and
  life-cycle stage, occupation, economic situation,
  lifestyle, personality and self-concept.
• Age and Life-Cycle Stage
• The types of goods and services people buy
  change during their lifetimes. Preferences for
  leisure activities, travel destinations, food and
  entertainment are often age related. Successful
  marketing to various age segments may require
  specialized and targeted strategies.
• Buying behavior is also shaped by the family
  life-cycle stages. Marketers often define their
  target markets in life-cycle terms and develop
  appropriate products and marketing plan.

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• Occupation
• A persons occupation affects the goods and
  services bought. Marketers try to identify
  occupational groups that have above-average
  interest in their product.
• Economic Situation
• A persons economic situation greatly affects
  product choice and the decision to purchase a
  particular product. Marketers need to watch
  trends in personal income, savings, and interest
  rates. If economic indicators point to a
  recession, they can redesign, reposition, and
  reprice their products.Conversely, periods of
  economic prosperity create opportunities.

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• Lifestyle
• People coming from the same subculture, social
  class and occupation may have quite different
  lifestyles. A lifestyle is a persons pattern of
  living as expressed in his or her activities,
  interests, and opinions.
• Personality and Self-Concept
• Each persons personality influences his or her
  buying behavior. Personality means distinguishing
  psychological characteristics that lead to
  relatively consistent and enduring responses to
  the environment.Personality can be useful in
  analyzing consumer behavior for some product and
  brand choices.
• There is another concept related to
  personalitya persons self-concept (also called
  self-image). Each person has a complex mental
  self-picture and his or her behavior tends to be
  consistent with that self-image.

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• Psychological Factors
• A persons buying behavior is also influenced by
  four major psychological factors
• motivation,
• perception,
• learning
• beliefs and attitudes.

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• Motivation
• A person has many needs . A need becomes a motive
  when it is aroused to a sufficient level of
  intensity.Creating a tension state causes the
  person to act to release the tension. Two of the
  most popular theories of human motivation are the
  theories of Abraham Maslow and Herzbergs theory
• Maslows Theory Of Motivation Human needs are
  arranged in a hierarchy from the most pressing to
  the least pressing. These are physiological
  needs,safety needs,social needs, esteem needs and
  self-actualization needs. A person tries to
  satisfy the most important need first and then
  the others subsequently.
• Herzbergs Theory He developed a two-factor
  theory that distinguishes dissatisfiers (factors
  that cause dissatisfaction) and satisfiers
  (factors that cause satisfaction).The absence of
  dissatisfiers is not enough, satisfiers must be
  actively present to motivate a purchase.

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• Perception
• Two people with the same motivation in the same
  situation may act quite differently based on how
  they perceive conditions. People can emerge with
  different perceptions of the same object because
  of three perceptual processes
• -Selective Attention Since a person cannot
  possibly attend to all stimuli, most stimuli will
  be screened out-a process called selective
  attention. It means marketers have to work hard
  to attract consumers notice. The real challenge
  is to explain which stimuli people will notice.
• -Selective Distortion It is the tendency to
  twist information into personal meanings and
  interpret information in a way that will fit our
  preconceptions.
• -Selective Retention People will tend to
  retain information that supports their attitudes
  and beliefs.

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• Learning
• Learning describes changes in an individuals
  behavior arising from experience.
• Most people behavior is learned.
• Learning theorists say that learning occurs
  through the interplay of drives, stimuli, cues,
  responses, and reinforcement.
• When consumers experience a product, they learn
  about it. Hotels should help guests to learn
  about the quality of their facilities and
  services.

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• Beliefs and Attitudes
• Through acting and learning, people acquire
  beliefs and attitudes, which in turn influence
  their buying behavior.
• A belief is a descriptive thought that a person
  holds about something. Marketers are interested
  in beliefs that people have about specific
  products and services. Beliefs reinforce product
  and brand images. Unfounded consumer beliefs
  deter purchases.

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• Beliefs and Attitudes
• An attitude describes a persons relatively
  consistent evaluations, feelings, and tendencies.
  Toward an object or an idea. Attitudes put people
  into a frame of mind for liking and disliking
  things and moving toward or away from them.

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THE BUYER DECISION PROCESS

• The buyer decision process consists of five
  stages

Need recognition
Postpurchase behavior
Purchase decision
Evaluation of alternatives
Information Search
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• Need Recognition
• The buying process starts when the buyer
  recognizes a problem or need. The buyer senses a
  difference between his or her actual state and a
  desired state. The need can be triggered by
  internal stimuli. From previous experience, the
  person has learned how to cope with this need and
  is motivated toward objects that he or she knows
  will satisfy it. At this stage, marketers must
  determine the factors and situation that trigger
  consumer problem recognition. They should
  research consumers to find out what kinds of
  needs or problems led them to purchase an item.

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• Information Search
• If the consumers drive is strong and a
  satisfying product is near at hand, the consumer
  is likely to buy it at that moment. If not, the
  consumer may simply store the need in memory and
  search for relevant information. The consumer can
  obtain information from several sources. These
  include
• Personal sources family friends, neighbors,
  acquaintances
• Commercial sources advertising, salespeople,
  dealers, packaging, displays
• Public sources restaurant reviews, editorial in
  the travel section, consumer-rating organizations
• With hospitality and travel products, personal
  and public sources of information are more
  important than advertisement. This is because a
  customer cannot try out an intangible product
  before they try it. Responses from personal
  sources have more impact than advertising because
  they are perceived to be more credible.

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• Evaluation of Alternatives
• There is no simple and single evaluation process
  used by all consumers or even by one consumer in
  all buying situations. Certain basic concepts
  will help explain consumer evaluation processes.
• -Each consumer sees a product as a bundle of
  product attributes. The most attention is paid to
  attributes connected with their needs.
• -The consumer attaches different degrees of
  importance to each attribute according to his or
  her unique needs and wants.
• -The consumer is likely to develop a set of
  beliefs about where each brand stands on each
  attribute. The set of beliefs held about a
  particular brand is known as the brand image.
• -The consumer is assumed to have a utility
  function for each attribute. A utility function
  shows how the consumer expects total product
  satisfaction to vary with different levels of
  different attributes.
• -Fifth, the consumer arrives at attitudes toward
  the different brands through some evaluation
  procedure.

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• Purchase Decision
• In the evaluation stage, the consumer ranks
  brands in the choice set and forms purchase
  intentions. Generally, the consumer will buy the
  most preferred brand, but two factors can come
  between the purchase decision.
• Attitudes of others represent the first. The
  more intense the other persons attitude and the
  closer that person is to the decision maker, the
  more influence the other person will have.
• Purchase intention is also influenced by
  unexpected situations. The consumer forms an
  intention based on factors such as expected
  family income, expected price and expected
  benefits from the product. When the consumer is
  about to act, unexpected situations may arise to
  change the purchase intention.

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• Post purchase Behavior
• The marketers job does not end when the consumer
  buys a product. Following a purchase, the
  consumer will be satisfied or dissatisfied and
  will engage in post purchase actions of
  significant interest to the marketer. Post
  purchase satisfaction depends on the
  relationship between consumer expectations and
  perceived product performance.
• If the product matches expectations, the consumer
  will be satisfied. If it falls short, the
  consumer will experience dissatisfaction. The
  larger the gap between expectations and
  performance, the greater the consumers
  dissatisfaction. This suggests that sellers must
  faithfully represent the products performance so
  that buyers are satisfied.
• Almost all major purchases result in cognitive
  dissonance or discomfort caused by postpurchase
  conflict. Thus consumers feel some postpurchase
  dissonance with many purchases.Marketers can take
  steps to reduce consumer postpurchase
  dissatisfaction and help consumers to feel good
  about their purchases.

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Chapter 5

• What is a product?
• Anything that can be offered to a market for
  attention, acquisition, use or consumption that
  might satisfy a want or need. It includes
• Physical objects
• Services
• Places
• Organizations
• Ideas

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• Product Levels
• Core product The most basic level it answers the
  question of What the buyer is really buying.
• Facilitating products Services or goods that
  must be present for the guest to use the core
  product.
• Supporting products Extra products offered to
  add value to the core product and to help
  differentiate it from the competition.
• Augmented product Includes accessibility,
  atmosphere, customer interaction with the service
  organization, customer participation, and
  customers interaction with each other.

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CORE PRODUCT

• All steak houses should learn
• Dont sell the steak, sell the sizzle
• Marketers must uncover the core benefit to the
  curtomer of every product and sell these
  benefits, rather than merely selling features.

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Facilitating products

• Services or goods that must be present for the
  guest to use the core product.

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Supporting products

• Extra products offered to add value to the core
  product and to help differentiate it from the
  competition.
• In a hotel, business center or a full service
  health spa are supporting products that may help
  to draw customers to the hotel.

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!!!

• The core product
• provides a focus for the business it is the
  reason for being.
• Facilitating products
• are those that are essential for providing the
  core product to the target market.
• Supporting products
• can help position a product.
• The augmented service offering
• combines what is offered with how it is
  delivered.

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• Augmented Product Issues
• Accessibility Location and working hours of
  operation.
• Atmosphere, the physical environment Critical
  element in services, it can be the reason for
  choosing the establishment. Appreciated through
  the senses (visual, aural, olfactory and
  tactile).
• Customer interaction with the service delivery
  system
• Three stages (1) joining (2) consumption (3)
  detachment.
• Customer interaction with other customers
  Hospitality organizations must manage the
  interaction of customers to ensure that some
  customers do not negatively affect the experience
  of others.
• Customer coproduction Involving the guest in
  service delivery can increase capacity, improve
  customer satisfaction, and reduce costs.

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• Brand Decisions
• A brand is a name, term, sign, symbol, design or
  a combination of these elements intended to
  identify the goods or services of a seller and
  differentiate them from those of competitors.
• Conditions that support branding
• 1. The product is easy to identify by brand or
  trademark.
• 2. The product is perceived as the best value for
  the price.
• 3. Quality and standards are easy to maintain.
• 4. The demand for the product class is large
  enough to support a regional, national, or
  international chain.
• 5. There are economies of scale.

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• The Product Is Easy to Identify by Brand or
  Trademark
• Desirable Characteristics of Brand Name
• It should suggest something about the products
  benefits and qualities.
• It should be easy to pronounce, recognize and
  remember.
• It should be distinctive.
• The name should translate easily to foreign
  languages for the companies seeking future
  expansion.
• It should be capable of registration and legal
  protection

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• The Product Is Perceived as the Best Value for
  the Price
• A brand name derives its value from consumer
  perceptions.
• Brands attract consumers by developing a
  perception of good quality and value.

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• Quality and Standards Are Easy to Maintain
• To be successful, a large multi-unit brand must
  develop systemwide standards to meet the
  expectations of the customer.
• If the brand is successful in developing an image
  of quality, customers will expect quality in all
  outlets carrying the same brand name.
• Consistency and standardization are critical
  factors.

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• There Are Economies of Scale
• Branding costs money, to justify expenditures for
  administration and advertising the brand should
  provide economies of scale.
• Management information systems, reservation
  systems, national purchasing contracts and common
  architectural designs are ways in which brands
  can provide economies of scale.

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• SORU 1 Resimdekilerden hangisinin size hediye
  edilmesini dilerdiniz? Neden?
• (Bayanlar sadece 1 veya 2 erkekler sadece 3 veya
  4)
• SORU 2 Sizin için önemli bir karsi cinse
  resimdekilerden hangisini hediye etmeyi
  dilerdiniz? Neden?
• (Bayanlar sadece 3 veya 4 erkekler sadece 1 veya
  2)

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Chapter 6Pricing Products Pricing
Considerations, Approaches and Strategy

• BUSINESS PERSPECTIVE
• Price is the amount of money charged for a good
  or a service.
• CUSTOMER PERSPECTIVE
• Price is the sum of values consumers exchange for
  the benefits of having or using the product or
  service.
• Price is the only marketing mix element that
  produces revenue.

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• Factors to Consider When Setting Prices
• Internal Factors Influencing Pricing Decisions
• a) Marketing Objectives
• Survival
• Current profit maximization
• Market-share leadership
• Product-quality leadership
• Other Objectives
• b) Marketing Mix Strategy
• c) Costs
• d) Organizational Considerations

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• Factors to Consider When Setting Prices
• External Factors Influencing Pricing Decisions
• Market and demand
• Cross Selling and Upselling
• c) Pricing in different markets
• d) Consumer Perceptions of Price and Value
• e) Analyzing the Price-Demand Relationship

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• Factors to Consider When Setting Prices
• Internal Factors Influencing Pricing Decisions
• a) Marketing Objectives
• i) Survival It is used when the economy slumps
  or recession is going on. A manufacturing firm
  can reduce production to match demand and a hotel
  can cut rates to create the best cash flow.
• ii) Current profit maximization Companies may
  choose the price that will produce the maximum
  current profit, cash flow or return-on
  investment, seeking financial outcomes rather
  than long-run performance.
• iii) Market-share leadership When companies
  believe that a company with the largest market
  share will eventually enjoy low costs and high
  long run profit, they will set low opening rates
  and strive to be the market-share leader.
• iv) Product-quality leadership Hotels like the
  Ritz-carlton chain charge a high-price for their
  high-cost products to capture the luxury market.
• v) Other Objectives Stabilize market, create
  excitement for new product, draw more attention.

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• Internal Factors Influencing Pricing Decisions
• b) Marketing Mix Strategy
• Price must be coordinated with product design,
  distribution, and promotion decision to form a
  consistent and effective marketing program.
• c) Costs
• i) Fixed Costs Costs that do not vary with
  production or sales level
• ii) Variable Costs Costs that vary directly with
  the level of production.
• d) Organizational Considerations Management must
  decide who within the organization should set
  prices . In small companies, this will be the top
  management in large companies, pricing is
  typically handled by a corporate department or by
  a regional or unit manager under guidelines
  established by corporate management.

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• External Factors Affecting Pricing Decisions
• Market and demand
• Although costs set the lower limits of prices,
  the market and demand set the upper limit. Both
  consumer and channel buyers (e.g. Tour operator)
  balance the products price against the benefits
  it provides. Thus before setting prices, a
  marketer must understand the relationship
  between price and demand for a product.
• Cross Selling and Upselling
• Cross selling Companys other products are sold
  to the guest.
• Upselling Occurs through training of sales and
  reservation employees to offer continuously a
  higher-priced product that will better meet the
  customers needs, rather than settling for the
  lowest price.

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• External Factors Affecting Pricing Decisions
• c) Pricing in different markets
• 1) Pure Competition The market consists of many
  buyers and sellers trading in a uniform
  commodity.
• 2) Monopolistic Competition The market consists
  of many buyers and sellers who trade over a range
  of prices rather than a single market price (e.g.
  restaurants).
• 3) Oligopolistic Competition The market
  consists of a few sellers who are highly
  sensitive to each others pricing and marketing
  strategies (e.e. airline companies).
• 4) Pure Monopoly The market consists of one
  seller it could be a government monopoly, a
  private regulated monopoly, or a private
  non-regulated monopoly.

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• External Factors Affecting Pricing Decisions
• d) Consumer Perceptions of Price and Value
• It is the consumer who decides whether a
  products price is right. The price must be buyer
  oriented . The price decision requires a creative
  awareness of the target market and recognition of
  the buyers motivations.
• e) Analyzing the Price-Demand Relationship
• Demand and price are inversely related the
  higher the price the lower the demand. Most
  demand curves slope downward in either a
  straight or a curved line. The prestige goods
  demand curve sometimes slopes upward.

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• External Factors Affecting Pricing Decisions
• f) Price Elasticity of Demand
• If demand hardly varies with a small change in
  price , we say that the demand is inelastic, if
  demand changes greatly, we say that demand is
  elastic.
• Buyers are less price sensitive when the product
  is unique or when it is high in quality, prestige
  or exclusiveness. Consumers are also less price
  sensitive when substitute products are hard to
  find.
• If demand is elastic, sellers will generally
  consider lowering their prices to produce more
  total revenue.

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• External Factors Affecting Pricing Decisions
• Factors Affecting Price Sensitivity
• Unique Value Effect Creating the perception that
  your offering is different from those of your
  competitors avoids price competition.
• Substitute Awareness Effect Lack of the
  awareness of the existence of alternatives
  reduces price sensitivity.
• Business Expenditure Effect When someone else
  pays the bill, the customer is less price
  sensitive.
• End Benefit Effect Consumers are more price
  sensitive when the price of the product accounts
  for a large share of the total cost of the end
  benefit.

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• External Factors Affecting Pricing Decisions
• g) Competitors Prices and Offers
• When a company is aware of its competitors
  price and offers, it can use this information as
  a starting point for deciding its own pricing.
• h) Other External Elements
• Other factors include inflation, boom or
  recession, interest rates, government purchasing
  , birth of new technology.

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• General Pricing Approaches
• Cost-based pricing Cost-plus pricing a standard
  markup is added to the cost of the product.
• Break-even analysis and target profit pricing
  Price is set to break-even on the costs of making
  and marketing a product or to make a desired
  profit
• Value-based pricing Companies based their prices
  on the products perceived value. Perceived value
  pricing uses the buyers perceptions of value,
  not the sellers cost, as the key to pricing.
• Competition-based pricing Competition-based
  price is based on the establishment of price
  largely against those of competitors, with less
  attention paid to costs or demand.

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• Pricing Strategies (New Products)
• Prestige Pricing Hotels or restaurants seeking
  to position themselves as luxurious and elegant
  will enter the market with a high price that will
  support it.
• Market-Skimming Pricing Price skimming is
  setting a high price when the market is price
  insensitive. It is common in industries with high
  research and development costs.
• 3) Market-Penetration Pricing Companies set a
  low initial price to penetrate the market quickly
  and deeply, attracting many buyers and winning a
  large market share.

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• Pricing Strategies (Existing-Products)
• Product-Bundle Pricing Sellers using
  product-bundle pricing combine several of their
  products and offer the bundle at a reduced price.
  Price bundling reduces price competition by
  making it hard to figure price components.
• Price Adjustment Strategies Volume discounts,
  discounts based on time of purchase,
  discriminatory pricing, yield management
• 3) Last-Minute Pricing Provides an outlet for
  unsold inventory, it is not a substitute for
  effective marketing and a well-devised pricing
  strategy.

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• Psychological Pricing Psychological aspects
  such as prestige, reference prices, round figures
  and ignoring end figures are used in pricing.
  Also reference should be considered.
• Promotional Pricing Hotels temporarily price
  some of their products below list price or below
  cost for special occasions.
• Value pricing means offering a price
  below competitors on a permanent basis. This is
  risky if a company does not have the ability to
  cut costs significantly. It is usually most
  appropriate for companies able to increase
  long-run market share through low prices.
• Price sensitivity measurement utilizes a
  target consumer survey with four questions from
  which the aggregate results are graphed to give
  an idea of consumer price sensitivity.

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• CHAPTER 7
• Distribution Channels
• A distribution channel is a set of independent
  organizations involved in the process of making a
  product or service available to the consumer or
  business user.
• Distribution systems can be viewed as the
  companys circulatory system.

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• Dagitim sistemi,
• insan vücudundaki
• dolasim sistemiyle eslestirilirse,
• isletmenin diger fonksiyonlari
• vücudun hangi bilesenleriyle
• iliskilendirilebilir?

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• A well managed distribution system can make the
  difference between a market-share leader and a
  company struggling for survival. CRS and own
  sales force is not enough so companies must
  develop increasingly complex distribution
  networks.
• The use of intermediaries depends on their
  greater efficiency in marketing the goods
  available to target markets. Through their
  contacts, experience, specialization and scale of
  operation, intermediaries normally offer more
  than a firm can on its own.

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• Distribution Channel Functions
• A distribution channel moves goods from
  producers to consumers. It overcomes the major
  time, place and possession gaps that separate
  goods and services from those who would use them.
• Information Gathering and distributing marketing
  research and intelligence information about the
  marketing environment.
• Promotion Developing and spreading persuasive
  communications about an offer.
• Contact Finding and communicating with
  prospective buyers.
• Matching Shaping and fitting the offer to the
  buyers needs.
• Negotiation Agreeing on price and other terms of
  the offers that ownership or possession can be
  transferred.
• Physical distribution Transporting and storing
  goods
• Financing Acquiring and using funds to cover the
  cost of channel work.
• Risk taking Assuming financial risks, such as
  the inability to sell inventory at full margin.

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• Marketing Intermediaries
• Marketing intermediaries available to the
  hospitality industry and travel include travel
  agents , tour operators, tour wholesalers,
  specialists, hotel sales representatives,
  incentive travel agents, government tourism
  associations, consortia and reservation systems
  and electronic distribution systems.
• Internet The internet is an effective marketing
  tool for hospitality and travel companies.
  Companies can use pictures, both still and
  moving, to display their product. Customers can
  make reservations and pay for products directly
  from the Internet.

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• Franchising is a method of doing business by
  which a franchisee is granted the right to engage
  in offering , selling or distributing goods or
  services under a marketing format that is
  designed by the franchisor. The franchisor
  permits the franchisee to use its trademark,
  name, and advertising.
• The Advantages of the franchise to the
  franchisee are
• Recognition of brand
• Less chance of a business failure
• National advertising, premade advertisements, ad
  marketing plans.
• Faster business growth
• Helps with site selection
• Architectural plans
• Operational systems, software, and manual to
  support the systems.
• National contracts with suppliers
• Product development
• Consulting
• Helps with financing

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• The Disadvantages of purchasing a franchise
  are
• Fees and royalties are required
• It limits the products sold and the recipes used
• The franchisee is often required to be open a
  minimum number of hours and offer certain
  products.
• A poorly operated company can affect the
  reputation of the entire chain.
• The franchisors performance affects the
  profitability of franchisees.
• Some franchisees may not benefit from national
  advertising as much as other franchisees-often a
  source of conflict.

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• The advantages of franchising for the franchisor
  are
• Receives a percentage of gross sales
• Expands brand
• Support for national advertising campaign
• Negotiating support for national contracts with
  suppliers.
• The disadvantages of a franchise for a
  franchisor
• There are limits on other options of expanding
  distribution.
• Fran