THC 6 Tourism and Hospitality Marketing PDF

 Chapter 1 INTRODUCTION TO MARKETING Objectives: At the end of the chapter, the student should be able to:  Define Marketing;  Enumerate types of market;  Identify the basic components of...

 Chapter 1 INTRODUCTION TO MARKETING Objectives: At the end of the chapter, the student should be able to:  Define Marketing;  Enumerate types of market;  Identify the basic components of marketing;  Understand the importance of marketing in business ; and  Differentiate marketing concept from selling concept. INTRODUCTION TO MARKETING Definition of Market For a layman, "market" is a place where buyers and sellers meet personally to finalize the deal after personal inspection of goods. However, for a student of marketing, it represents that place where buyers and sellers come in contact with one another due to which the prices of goods and services tend to be equalized easily and quickly. Thus, market does not mean a place of exchange. It is an arrangement that provides opportunity of exchanging goods and services for money or money's worth. A market is asset of actual and potential buyers who might transact with a seller. 1.1 Types of Market There are different types of market as stated by Kotler, such as consumer, business, global and nonprofit. 1. Consumer Market a. This refers to those who buy goods for their personal use or purpose, such as buying a personal computer to accomplish one's academic requirements.  Admin Works PPT Presentation Good bought in consumer markets can be categorized in several ways: a. Fast Moving Consumer Goods  These are high volume, low unit value, fast repurchase. Examples include: ready-to-eat meals, baked beans ; newspapers b. Consumer Durables These have low volume but high unit value. Consumer durables are often divided into: White Goods - (e.g., fridge-freezers; cookers; dishwashers; microwave) Brown Goods - (e.g., DVD players, games consoles, personal computer) c. Soft Goods Soft goods are similar to consumer durables, except that they wear out more quickly and therefore, have a shorter replacement cycle. Examples include clothes and shoes. d. Services This refers to a transaction in which no physical goods are transferred from the seller to the buyer. The benefits of such a service are held to be demonstrated by the buyer's willingness to make the exchange. Using resources, skill, ingenuity, and experience, service providers benefit service consumers. Examples include hairdressing, dentists, and hospitality services. 2. Business Markets These institutions or people buy industrial goods either for the purpose of using in business operations. Also known as business-to-business marketing or B2B Marketing. Computer Set Computer Shop 3. Global Markets Markets which have historically been tried in international trade are most readily identified as being global. A marketing strategy used mainly by multinational companies to sell goods or services internationally. Global marketing is sometimes used to refer to overseas expansion efforts through licensing, franchises, and joint ventures. 4. Non-Profit and Government Markets A type of organization that does not earn profits for its owner. All of the money earned by or donated to a not-for-profit organization is used in pursuing the organization's objectives. A not-for-profit organization is an organization that exists to attain some goals apart from the usual goals of profit, market share and return of investment. It operates in both public and private sectors like churches, public schools, public charities, hospitals etc. Examples: Tuloy Foundation Inc. - helps in the upliftment of abandoned and street children ABS CBN Foundation Inc. Sagip Kapamilya - Outreach program for children, their families, the environment and community. Jollibee Food Corporation Seeds Program (Skills Enhancement and Education Development for Students - to support the working students to continue their studies while working at Jollibee KFC Addd Hope - campaigns collects donations in store to fund meals for less fortunate children. 1.2 Definition of Marketing CUSTOMER ANALYSIS ADVERTISING MARKET SALES PROMOTION PRICE INTERNET TARGET =MARKETING Marketing is the organization's task to determine the needs, wants, and interest of target markets and to deliver the desired product/service more effectively and efficiently than competitors in a way that preserves or enhances the consumer's and the society's well-being. According to Harry L. Hanson, marketing is "the process of discovering and translating consumer needs and wants into product and service specification, creating demand. It is the performance of those business activities that direct flow of goods and services from the producers to the consumers."  According to Philip Kotler, the Father of Modern Marketing, marketing is working with markets attempting to actualize potential exchanges, a human activity directed at satisfying needs and wants through the exchange processes. There are several basic components underlying marketing, namely: 1. Needs Things we must have in order to stay alive. 2. Wants Things we don't really need but would like to have. Particulars Needs Wants Hunger Food Chinese: noodles, siomai, tikoy, buchi Fashion Wear Clothing Uniqlo, Bench, Levi’s Shelter Housing condominium, dorm, townhouse Recreation Sports basketball, volleyball Transportation Vehicle cars, vans, bus, jeepney 3. Potential Exchange Where the buyers and sellers physically meet and exchange goods and services. 4. Human Activity Concerned with people and the activities involved in the flow of goods and services from producers and consumers 5. Demands a. Demands are human wants that are backed by buying power. b. Consumers view products as bundles of benefits and choose products that give them the best bundle for their money. 1.3 Different Aspects of Marketing Nature of Marketing 1. Consumer-Oriented Process - The basic objective of marketing is to fulfil the needs of human beings. Hence, identifying the customer needs is the most significant aspect of marketing organizations. 2. Starts and Ends with the Customer - Marketing is about satisfying the customer needs; it is very essential for the marketer to collect relevant information about customer choices and preferences about the product or services. Marketer should adopt proper research techniques to find out the tastes and interests of the buyers. 3. Guiding Element of Business - Marketing is considered as an essential element in the development of every economy. An economy which is market driven will definitely raise the standard living of the people. Hence, the responsibility of marketing is to integrate all activities involved in the marketing and reach customer at a maximum speed with minimum cost. 4. System-Oriented Process - Marketing is an input-output process. This means that there is a whole lot of interaction between the marketer and the customer in the process of marketing. It is a process of receiving inputs of marketing from the environment. i.e., the customers - such tastes, preferences, etc. and translating them into output such as desired products and services for the fulfillment of the customer needs. 5. Goal-Oriented Process - No business can be successful unless it has a goal to achieve. Since marketing is one of the most important activities that any organization performs, setting proper goals is very essential. There can be goals such as increase in the volume of sales increase in profit etc. 6. Exchange Process - Marketing is a dynamic process of exchange of goods and services between the sellers and the buyers. Not only goods and services are exchanged, but a whole lot of information about the goods and services is also exchanged between the sellers and buyers. 1.4 Importance of Marketing 1. Marketing helps the organization to reach the objectives into realization in order for them to become more effective in marketing aspects that will guide them to survive in the stiff competition of business. 2. It helps people to satisfy their economic and social needs and to have opportunity to raise the standards of their living. It secures better services for their consumers and it helps and guides the company to fulfill and maximize its corporate and social responsibilities. 3. It helps in making and offering the products and services that are needed by the consumers and community. The right and proper production consumption can help the organization to become more effective to have a consistent and right path in production utilization of resources- manpower and materials - reducing turnovers. 4. It helps the company to use and adjust the changing status and situation. Competition is a never-ending battle they must be willing to respond from the changing needs of people in order to win the competition. 5. It helps the enterprise in reaching the maximum efficiency, output and income with the minimum use of resources. 6. It ensures the economic potentials of the company which results in growth and economic development of the country. Benefits of Marketing A. Benefits to Society 1. It is the instrument for changing the living standards of society. Society depends on marketing for all its requirements of products and services. Marketing is a means to convert production and purchasing power into consumption. Marketing is the delivery of standard of living. 2. It provides gainful employment opportunities. Just as every industry provides employment opportunities to thousands of skilled, semi-skilled, and unskilled workers. Marketing is a complex and mammoth mechanism involving number of functions and sub-functions, warranting the services of highly specialized and talented men and women. It is a prolific source of livelihood for many. 3. It is the stabilizer of economic conditions. Economic stability is the sure sign of any efficient and dynamic economy. It indicates that the economic activities are set at high which are consistent and continuous. It is marketing that reduces the severities of the extreme economic situations of inflation and deflation as it connects the two wheels of production and consumption. B. Benefits to the Individual Firms 1. It is an outlet to earn profit. Profit is the core on which the super-structure of business is built. To earn the desired profit, the business community has to struggle as there is no simple and straight formula to earn profit. 2. It provides base for business decisions. The basic problems of every producer are: what to produce; when to produce; where to produce; how to produce; how much to produce and at what cost to make the goods and services are available. 3. It is a source of new ideas. The marketing conditions are ever changing. It is the environmental changes that bring about the changes in the business variables at unit. It means that the consumer needs, likes, tastes, preferences, etc. differ from time to time, and place to place. 1.5 Marketing Philosophies 1. Marketing Concept It is a management orientation which holds that the key task of the organization is to determine the needs and wants of the target markets and to adapt the organization to delivering the desired satisfactions more effectively and efficiently than its competitors. Discover Market Research (RESEARCH) Product Planning and Development (PRODUCTION) Distribution of Products and Services Guaranteed Sales Volume & Profits at Customer Satisfaction The Basic Components of Marketing Concepts are: a. Consumer Orientation It refers to the organizational culture, processes, and system aimed at understanding customer needs strategically and developing products and services that provide satisfaction to the consumer needs strategically and developing products and services that provide satisfaction to the consumer in ways that yield profitability to the business. b. Integrated Marketing This is a strategy aimed at unifying different marketing methods such as mass marketing, one-to-one marketing, and direct marketing. Its objective is to complement and reinforce the market impact of each method, and to employ market data gathered by these efforts in product development, pricing, distribution, customer service, etc. c. Marketing Research and Long-term Planning and Development Keeping pace with market trends is never easy, its important to acknowledge that industry is ever changing and in order to stay ahead of the curve and competitors passing you by you need to be able to move with the times for the benefit of long-term business planning. 2. Selling Concept This is a management orientation which assumes that consumers will either buy or not buy enough of the organization’s product unless the organization makes a substantial effort to stimulate their interest in its product. Product Planning and Development (Production) Promotional Methods and Selling (Persuasive Techniques) Distribution of Products and Services Unguaranteed Sales Volume and Profit/Unguaranteed Customer Satisfaction