Marketing Research in Travel and Tourism

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Marketing Research in Travel and Tourism

• Objective Understanding the role of marketing
  research and its value in travel and tourism.

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Marketing Research

• Marketing research includes all forms of
  research-based information used in making
  marketing decisions, including consumer research,
  database analysis, and marketing information
  systems (MIS).
• To facilitate marketing decision making,
  marketing research gathers, processes, analyses,
  stores and communicates information.

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• Due to technological developments, today,
  information gathering is handled with the help of
  advent computer technology, faster data
  processing, and sophisticated database software.
• Today, most of the information is gathered via
  the Internet, mobile phones, telephones and other
  traditional methods including questionnaires and
  interviews.
• In order to provide solutions to management
  problems, marketing research helps to reduce the
  amount of uncertainty and risk.

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• Marketing research helps to make informed
  decisions.
• However, in the travel and tourism industry, the
  use of marketing research is still less effective
  when compared to the research carried out in
  other major industries.
• This is because of the managers in travel and
  tourism who assume that less research is
  required, since they are face to face with their
  customers most of the time. This may be true for
  small operations.

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Main Categories of Marketing Research and Their
Use

• Market analysis and forecasting
• used in/for marketing planning
• to measure and project market volumes, shares and
  revenue by relevant categories of market segments
  and product type.
• Customer research
• used in/for segmentation, branding and
  positioning
• to measure customer profiles, awareness,
  attitudes, and purchasing behavior (quantitative)
• To assess consumer needs, perceptions and
  aspirations (qualitative).

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• Product and price studies
• used in/for product formulation, presentation,
  pricing and market assessment
• to measure and consumer testing of amended and
  new product formulation, and price sensitivity
  studies.
• Promotions and sales research
• used in/for efficiency of communications
• to measure consumer reaction to alternative
  advertising concepts and media usage, response to
  forms of sales promotion, sales-force
  effectiveness and website responses.

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• Distribution research
• used in/for efficiency of distribution
  network/channels
• to measure distributor awareness of products,
  stocking and display of brochures and
  effectiveness of merchandising. Includes retail
  audits and occupancy studies, analysis of website
  usage and of call centers.
• Evaluation and performance monitoring studies
• used in/for overall control of marketing results
  and product quality control
• to measure customer satisfaction overall and by
  product elements. Includes marketing tests and
  experiments and use of mystery shoppers.

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Types of Marketing Research Used in Travel and
Tourism

• Most common types of marketing research used in
  travel and tourism
• Continuous and ad hoc
• Quantitative and qualitative
• Primary and secondary
• Omnibus and syndicated
• Occupancy studies

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Continuous and ad hoc

• Key trend data should be measured on a regular
  daily, weekly, or monthly basis.
• Examples include data covering enquiries, sales,
  booking types and patterns, market shares,
  customer satisfaction, seat or hotel bed
  occupancy.
• Very important for customer satisfaction and
  developing the marketing mix.

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• There may also be specific marketing problems
  requiring research. These require specific or ad
  hoc investigation e.g. Is the market potential
  good enough to make a new hotel investment, what
  size and what service level would be profitable?
• Modern continuous research include Internet
  search of websites and advertising links.
  Websites are monitored for traffic, number of
  clicks and page uses generated. Website
  information can be adjusted based on the words
  used while Googling by potential customers.

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Quantitative and Qualitative

• With the help of quantitative research, numerical
  estimates can be made based on the structured
  questions asked to random samples of existing or
  potential customers.
• Every respondent is asked the same questions,
  therefore, variations to suit individual
  circumstances are not possible.
• With the help of such research, a coach operator
  can find out on average how much money customers
  spend, how many nights they stay, etc.

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• To measure consumer motivations and attitudes,
  qualitative research is used.
• Most have exploratory or open-ended questions
  with small samples of carefully targeted
  individuals (focus group).
• With the help of such research, a company can
  understand how customers feel about Brand A
  compared with Brand B, what attitudes and values
  are perceived as adhering to Brand A and not
  Brand B, etc.
• Such research is helpful to understand and
  communicate positioning and branding values.

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Primary and Secondary

• Primary data collection requires the gathering of
  data not available from any other (secondary)
  source.
• Secondary data are information originally
  collected before for a purpose but available for
  a company to use.
• Includes all published sources such as Internet
  usage data, government statistics, trade
  association surveys and commercial publishers
  market surveys.

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• Secondary data collection is always cheaper and
  quicker.
• Data collection always starts with secondary data
  collection before primary research.
• When the secondary data collection is efficiently
  done, less expensive primary data collection
  takes place.

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Omnibus and Syndicated

• Large market research companies collect their own
  data from survey samples and sell them to a range
  of customers. Such research is known as omnibus
  surveys.
• They are potentially open to all users.
• Such surveys are cost effective for companies
  which looks for answers to four or five key
  questions, compared to collecting the data
  themselves.

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• Besides getting answers to specific questions,
  such data provide information on the profile
  characteristics by age, postcode, readership of
  media, etc.
• In the UK, the United Kingdom Tourism Survey is a
  well-known survey of UK tourism. Such research is
  carried out by the Ministry of Culture and
  Tourism in Turkey.
• Data covers choice of accommodation, transport
  mode, areas and destinations visited, purpose of
  trip, etc.

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• Omnibus surveys may also be carried out for
  specific market segments such as backpackers,
  business travelers, etc.
• Syndicated surveys may also provide similar
  information, however they are commissioned by a
  group of clients on a cost-sharing basis. For
  instance hotels in Kemer receive details for
  their own operations by sharing costs. They can
  also get relevant comparisons with competitors.
• Both omnibus and syndicated research provide
  cost-effectiveness especially for small firms who
  are also provided technical assistance.

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Occupancy Studies

• Since it is very valuable to understand key
  trends in the industry, a small but
  representative sample of businesses in tourism
  such as hotels are asked to maintain their daily
  records on arrivals and departures and rates
  paid.
• These data can then be analyzed on a weekly,
  monthly or quarterly basis.
• They can be communicated to the sector as a
  whole.

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Marketing Research Tool Kit

• Desk research (secondary sources)
• Sales/bookings/reservation records daily,
  weekly, etc by type of customer, type of product
  etc.
• Visitor information record, e.g. guest
  registration cards, booking form data, call
  centre or website data
• Government publications/trade association
  data/national tourist office data/abstracts and
  libraries
• Commercial analyses available on subscription or
  purchase of reports

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• Previous research studies conducted internal
  data bank
• Press cuttings of competitor activities, market
  environment change.
• Qualitative or exploratory research
• Organized marketing intelligence, such as staff
  feedback, sales-force reports, attendance at
  exhibitions and trade shows
• Focus group discussions and individual interviews
  with targeted customers/non-users, especially to
  identify the perceptions and attitudes of key
  users and non-user groups

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• Observational studies of visitor behavior, using
  cameras, electronic beams or trained observers
• Marketing experiments with monitored results
• Quantitative research (syndicated)
• Omnibus questions to targeted respondents
• Syndicated surveys, including audits
• Quantitative research (ad hoc and continuous)
• Studies of travel and tourism behavior and
  usage/activity patterns
• Attitude, image, perception and awareness studies
• Advertising and other media response studies

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• Customer satisfaction, value for money and
  product monitoring studies
• Distribution studies amongst the range of
  distribution channels being used or investigated
  for future use

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Customer Access A Priceless Asset

• Due to the inseparable nature of travel and
  tourism operations service producers and
  customers being on the premises, there is a major
  opportunity to organize internal research
• Feedback from customer contact staff and
  customers themselves provide valuable stream of
  marketing decision information in travel and
  tourism organizations.

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Researching Customer Satisfaction and Value for
Money

• Large tour operators typically conduct
  self-completion customer satisfaction surveys to
  all travelers returning from holidays generally
  on flight back home.
• Such data is helpful in analyzing satisfaction
  and value for money.
• Since those surveys ask profile information,
  data can be analyzed by age of respondent, region
  of origin, postal codes, cost of package, etc.

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• Mystery shoppers is an alternative research
  technique to collect data on the quality of
  service delivery.
• It is widely used in accommodation and restaurant
  sectors of tourism.

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Sources

• Kotler, P. Bowen, J. and Makens, J. (1999).
  Marketing for Hospitality and Tourism (2nd ed.).
  Prentice Hall. NJ.
• Kotler, P. and Armstrong, G. (2006) Principles of
  Marketing (11th ed.). Prentice Hall. NJ.
• Middleton, V.T.C. Fyall, A. Morgan, M. and
  Ranchhod, A. (2009) Marketing in Travel and
  Tourism (4th ed). Elsevier. Oxford.