Marketing Flashcards
I. MARKET STRATEGY IN HOTEL INDUSTRY
Marketing started as a result of economic and business pressure due to a need that arises to focus on
embracing a set of managerial measures to satisfy customers’ needs. The evolution of marketing in the
Identify Customers
hotel industry is similar to every other industry. The main reason for the marketing in the hotel business
is because of the growth in the number of guests who need accommodation and the increase in
competition by the accommodation service providers. Moreover
the hotel industry is becoming a more
and more mature market whereby the competition is increasing globally
and winning customers
becomes a problem. Therefore
there is a huge shift to marketing.
The hotel industry is so competitive that it requires the hotel to formulate a dynamic mechanism that
can adapt to the changes in the market environment
the competitiveness of the market as well as the
economic climate. The ultimate goal of having a marketing strategy is usually to identify opportunities to
serve the market in a way that is profitable and effective enough to the extent that it becomes difficult if
not impossible for another company to ta to take up the venture without running into losses.
Some authors believe that at the initial stage of starting a hotel business
the hotel will not make a profit
even in the second year the hotel will only break even and the hotel may start to make a little profit from
the third year. On the other hand
other marketers in the hotel industry of think that the hotel can start
to make a profit immediately from the first year of entering into the mark industry if the right marketing
strategies were used.
A hotelier that wants to achieve success needs to have a deep understanding of marketing and how to
combine various marketing elements such as price
product promotion
The above graph is a representation of the entire marketing strategy of a hotel. A hotel needs to use
different combinations of various inputs such as advertising marketing channel personal selling
and
advertising
and so on to get the desired return on investment.
It is common to see society changes in its value and needs so hotel marketers also have to change the
overall marketing strategy to fit the changes in society. Marketing strategy helps in discovering the areas
affected by organizational growth and thereby helps in creating an organizational plan to cater to the
customer needs. It helps in fixing the right price for organization’s goods and services based on
information collected by market research.
II. ROLE OF MARKETING IN HOSPITALITY INDUSTRY
Effective marketing campaign gives a company an edge over its competitors. A business may offer the
Marketing plays a vital role in the success of any business organization. Since all aspects of the business
depend on successful marketing
it is difficult to highlight all the roles which marketing plays in a
company.
Marketing helps in building a company’s brand name and placing the company’s product or service in the
heart of prospective customers. In the hotel industry
the success of any hotel often depends on a good
reputation. As the reputation of a hotel grows bigger within society
more customers will lodge in the
hotel
thereby making the hotel’s room occupancy rate increase and generate more income for the
hotel. Additionally
it is fair to say that marketing really helps in the aspect of branding as it creates and
supports effective communication within and outside the hotel unit.
best product in the market
but without a good marketing campaign
returns on investment because it is marketing that makes the product or service known to prospective
customers
A good marketing campaign helps a company to efficiently manage its resources. When an effective and
efficient marketing strategy is adopted in a company
resource wastage is reduced if not eliminated. The
hotel industry is an industry with perishable products
in other Words
particular period
the income that is supposed to be realized on that particular room is lost forever and it
cannot be regained.
THE ROLE OF MARKETING
IDENTIFY CUSTOMERS
• Understand customer wants and needs
• Identify whom to target and how to reach them
SATISFY CUSTOMERS
• Make the right productor service available to the right people at the right time
• Make everyone feel better off from the exchange
RETAIN CUSTOMERS
• Give customers a reason to keep coming back
• Find new opportunities to win their business
Figure 3.2: The Role of Marketing
Effective marketing contributes to the hotel’s ability to maintain a high occupancy rate at all times.
Marketing aids in the growth of a company’s revenue. As more individuals become aware of a company’s
products or services
the company’s market share grows
Since marketing serves as a platform for bridging the gap between a hotel and its clients
a hotel’s
marketing plan must guarantee that the proper messages are communicated to customers. Furthermore
marketing’s ultimate purpose should be to facilitate a win-win situation for both the hotel and the
clients. The hotel management should implement the most effective and efficient marketing strategies
that serve the company’s interests without risking the customers’ interests.
THE HOTEL MARKETING MIX
Defining a proper marketing mix for the hotel industry is crucial for the success of hotel marketing
efforts. A marketing mix is used to indicate the several marketing variables used by the sales team to
target specific guests or target market segments (E.g.: Corporate
Transient
etc.).
The MARKETING MIX is often created by the sales director and marketing sales managers. The hotel
should have the appropriate facilities/services
as well as effective promotional strategies (both online
and
offline) and
finally
Figure 3.3: The Hotel Marketing Mix Chart
1) Service/ Facilities:
This is considered as the first because without this hotel marketing team will have nothing to
deliver or offer to the potential guests/ customers.
Hotel industry offer products like:
• Guest rooms
• Food and beverage
• Banqueting rooms
• Conference facilities
• Recreational facilities
• Health and wellness facilities
• Executive lounge
• Express check-in checkout services
• Travel desk
• Business center
• Parking facilities etc.
Hotels generally cater to different market segments and each of these market segments has different
requirements. E.g.: A leisure guest on a family trip looks for recreational and wellness facilities of the
hotel whereas a business traveler gives importance to the hotel’s business facilities like the business
center
video conferencing. good in-room internet connectivity
This analysis by the sales and marketing department can assist top management in identifying these
specific requirements and working with them to establish such facilities or make the necessary
adjustments.
2) Place and Distribution
This refers to the accessibility of the products to consumers. When comparing to other products
normally hotels products doesn’t travel to customers but the customers come to the product.
Place or Location of the hotel e.g.; choices like in the city
outskirts of the city
a chain of hotels with presence in multiple locations. The hotel uses either direct or indirect distribution
methods to reach out to its potential customers. Direct methods refer to direct-customer-approach
where the hotel controls all aspects of distribution while Indirect methods involves third parties such as
agencies to help them with distribution. Examples of both are below…
Direct methods
• Sales through the hotel sales team
• Personal telephone calls
• Online pay per click or Banner Advertisements (Google ads
Facebook ads
• Printed media Advertisements
• Other Media Advertisements
• Hotel Website Booking System (WBS)
• Global distribution system (GDS)
Indirect methods
• Travel Agents
• Independent Travel agents
• Event Planners
• Online Travel Agents (Expeida
booking.com
• Online Travel portals (Trip Advisor
Hotels
• Independent hotel representative.
3) Promotions and communications
The hotel’s director of sales and marketing should figure out the best promotion and communication
mix. The way hotels interact with their target clients is through promotion. Promotion is a
communication tool that is used to not only inform but also interact with clients in order to gain longterm benefits. The basic goal of promotion is to keep customers/visitors informed.
Below are few promotions and communication channels used by hotels:
• Brochures
• Television commercials
• Hotel Websites
• Twitter Channel
• Facebook Page
• Google+ Page
• Hotel pens & pencils
• Scratchpads with the hotel logo
• Billboards
• TV Commercial
4) Room Rate or Pricing:
One of the most crucial components of the marketing mix is determining the proper price approach. If
hotel products such as guest rooms
food and beverage menus
competitively
potential guests may decline to use hotel services.
In this highly competitive sector
pricing and name packages have a significant impact on guests. Hotel
rate codes and packages are created with the goal of attracting or impressing guests. The room rent you
charge for your hotel rooms is critical to your business
particularly if you want to sell more rooms. As a
result
correctly pricing your rooms at the appropriate moment is unavoidable.
Generally
the hotel room rates are defined as per the below season:
Peak Season
This is the period when demand for a hotel and its services is highest and the hotel can charge the
highest prices to the guest. There is no defined peak period for all hotels to varies from hotel to hotel.
Valley Season/Off-Season
This is the time of the year with the lowest demand for rooms. Hotels generally offer the reduced rates
and packages e.g.: Stay for 3 and pay for 2 nights
Discounted Package rates
Shoulder Season
This period falls between peak season and off-season
and this time is considered as the best time to
attract new business as the rooms are available and medium or highest rates can be charged Also
the
sales and marketing activities should be the highest during t
