HMD402 UNLV Ch 1 Marketing for Hospitality and Tourism Questions You need to read 4 files that I attached first and then please answer follow questions. A

HMD402 UNLV Ch 1 Marketing for Hospitality and Tourism Questions You need to read 4 files that I attached first and then please answer follow questions.

Answers are expected to be written in full sentences and be thoughtful.

You are to type your responses underneath each question in this document. Please make sure there is a space between the question, your response, and the next question.

Question 1 (10 points)

Many managers view the purpose of business as making a profit, whereas some view the purpose as being able to create and maintain a customer. Explain how these alternative viewpoints could affect a company’s interactions with its customers. If a manager views the purpose as being able to create and maintain a customer, does this mean that the manager is not concerned with profits?

Question 2 (10 points)

What is customer equity? How can a company increase its customer equity? Marke&ng for Hospitality and Tourism
TCA 380
Dr. Tony L. Henthorne
Introduc)on: Marke)ng for Hospitality and Tourism
Chapter 1
Dr. Tony Henthorne
UNLV
Chapter 1
Introduction:
Marketing for
Hospitality and
Tourism
Learning Objectives
1. Understand the relationships
between the world’s hospitality and
travel industry.
2. Define marketing and outline the
steps in the marketing process.
3. Explain the relationships between
customer value and satisfaction.
Learning Objectives (cont.)
4. Understand why the marketing
concept calls for a customer
orientation.
5. Understand the concept of the
lifetime value of a customer and be
able to relate it to customer loyalty
and retention.
Chipotle Mexican Grill
Key Components of
Chipotle’s Vision
Purpose of a Business
Create &
Maintain
Customer
Orientation
Satisfied &
Profitable
Customers
What is Marketing?
• Marketing is the process by which
companies create value for
customers and society, resulting in
strong customer relationships which
capture value from the customers in
return.
Marketing Mix
Product
Price
Place
(Distribution)
Promotion
(Sales & Advertising)
Tourism Marketing
Hospitality
Industry
Tourism
Marketing
Travel
Industry
Figure 1–1 A simple model
of the marketing process.
Core Customer & Marketplace
Concepts
Needs, Wants &
Demands
Exchanges &
Rela&onships
Marke&ng
Offerings
Value &
Sa&sfac&on
Markets
Needs, Wants & Demands
Needs
Demands
Wants
Marketing Offerings
• Customer wants and needs are
fulfilled through some combination of
tangible and intangible products
and services.
The Gamboa Rainforest Resort offers an experience of a lifetime, allowing
guests to explore Panama’s rainforest and then relax at a resort enjoying a
meal while watching ships traverse the Panama Canal.
Value & Satisfaction
Customer Value
Customer
Satisfaction
Customer
Expectations
Exchanges & Relationships and
Markets
MARKET
Exchange
vs.
Rela&onships
Marketing Management
Orientations
Management
Orienta&ons
Societal Marketing
Society
(Human welfare)
Societal
Marketing
Concept
Consumers
(Want Satisfaction)
Company
(Profits)
Customer Relationship
Management
Customer
Value
Customer
Sa)sfac)on
Engaging Customers
CustomerEngagement
Marke)ng
ConsumerGenerated
Marke)ng
Lifetime Value of the Customer
• Losing a customer means losing
more than a single sale.
– It means losing the entire stream of
purchases that the customer would
make over a lifetime of patronage.
Lifetime Value of the Customer
(cont.)
• A company can lose money on a
specific transaction but still benefit
greatly from a long-term
relationship.
– This is one of the reasons successful
companies empower employees to
resolve customer complaints.
Figure 1–5
Customer relationship groups.
The Changing Marketing
Landscape
The Digital
Age
Sustainable
Marke)ng
Changing
Economic
Environment
Rapid
Globaliza)on
Co-Crea)on
The Sharing
Economy
Chapter 1: Introduction
Chapter Notes
I. Customer orientation. The purpose of a business is to create and maintain profitable
customers. Customer satisfaction leading to profit is the central goal of hospitality
marketing. [Slide 1-4]
II. What Is Hospitality Marketing? Marketing is the art and science of finding, retaining,
and growing profitable customers. [Slide 1-5]
III. Importance of Marketing
A. The entrance of corporate giants into the hospitality market and the marketing
skills these companies have brought to the industry have increased the importance
of marketing within the industry.
B. Analysts predict that the hotel industry will consolidate in much the same way
as the airline industry has, with five or six major chains dominating the market.
Such consolidation will create a market that is highly competitive. The firms that
survive this consolidation will be the ones that understand their customers.
C. In response to growing competitive pressures, hotel chains are relying on the
expertise of the marketing director.
IV. Travel Industry Marketing [Slide 1-7]
A. Successful hospitality marketing is highly dependent on the entire travel
industry.
B. Government or quasi-government agencies play an important role in travel
industry marketing through legislation aimed at enhancing the industry and
through promotion of regions, states, and nations.
C. Few industries are as interdependent as the travel and hospitality industries.
V. Understanding the Marketplace and Customer Needs. The marketing process is a fivestep model of the marketing process. In the first four steps, companies work to
understand consumers, create customer value, and build strong customer relationships. In
the final step, companies reap the rewards of creating superior customer value. By
creating value for customers, they in turn capture value from customers in the form of
sales, profits, and long-term customer equity. [Slide 1-8]
A. Understand customers [Slide 1-9]
1.Needs. Human beings have many complex needs. These include basic
physical needs for food, clothing, warmth, and safety; social needs for
belonging, affection, fun, and relaxation; esteem needs for prestige,
recognition, and fame; and individual needs for knowledge and selfexpression.
2.Wants. Wants are how people communicate their needs.
3.Demands. People have almost unlimited wants but limited resources.
They choose products that produce the most satisfaction for their money.
When backed by buying power, wants become demand. [Slide 1-10]
4.Market offerings. Some combination of tangible products, services,
information, or experiences that are offered to the market. [Slide 1-11]
5.Value, expectations, and satisfaction [Slide 1-12]
a. Customer value is the difference between the benefits that the
customer gains from owning and/or using a product and the costs
of obtaining the product.
b. Customer expectations are based on past buying experiences, the
opinions of friends, and market information.
c. Satisfaction. Satisfaction with a product is determined by how
well the product meets the customer’s expectations for that
product.
B. Exchange and relationships [Slide 1-13]
1. Exchange. Exchange is the act of obtaining a desired object from
someone by offering something in return.
2. Relationship marketing. Relationship marketing focuses on building a
relationship with a company’s profitable customers. Most companies are
finding that they earn a higher return from resources invested in getting
repeat sales from current customers than from money spent to attract new
customers.
3. Designing customer-driven marketing strategy. Marketing management
is the art and science of choosing target markets and building profitable
relationships with them.
a. Selecting customers to serve. The company must select those
market segments it wishes to serve.
b. Choosing a value proposition. The company must also decide
how it will serve targeted customers—how it will differentiate and
position itself in the marketplace. A company’s value proposition
is the set of benefits or values it promises to deliver to consumers
to satisfy their needs.
VI. Designing a Customer Value-Driven Marketing Strategy
A. Choosing a value proposition. The company must also decide how it will serve
targeted customers and how it will differentiate and position itself in the
marketplace.
B. Marketing management orientation [Slide 1-14]
1. Production concept. The production concept holds that customers will
favor products that are available and highly affordable, and therefore
management should focus on production and distribution efficiency.
2. Product concept. The product concept holds that customers prefer
existing products and product forms, and the job of management is to
develop good versions of these products.
3. Selling concept. The selling concept holds that consumers will not buy
enough of the organization’s products unless the organization undertakes a
large selling and promotion effort.
4. Marketing concept. The marketing concept holds that achieving
organizational goals depends on determining the needs and wants of target
markets and delivering the de-sired satisfaction more effectively and
efficiently than competitors.
5. Societal marketing concept. The societal marketing concept holds that
the organization should determine the needs, wants, and interests of target
markets and deliver the desired satisfactions more effectively and
efficiently than competitors in a way that maintains or improves the
consumer’s and society’s well-being. [Slide 1-15]
VII. Preparing an Integrated Marketing Plan. The company’s marketing strategy outlines
which customers the company will serve and how it will create value for these customers.
Next, the marketer develops an integrated marketing program that will actually deliver
the intended value to target customers. The marketing program builds customer
relationships by transforming the marketing strategy into action. It consists of the firm’s
marketing mix, the set of marketing tools the firm uses to implement its marketing
strategy. The major marketing mix tools are classified into four broad groups, called the
four Ps of marketing: product, price, place, and promotion. [Slide 1-6]
VIII. Build Customer Relationships. Customer relationship management (CRM) involves
managing detailed information about individual customers and carefully managing
customer “touch points” in order to maximize customer loyalty. [Slides 1-16 to 1-17]
IX. Capturing Value from Customers. We try to capture value from our customers in the
form of current and future sales, market share, and profits. By creating superior customer
value, the firm creates highly satisfied customers who stay loyal and buy more. [Slides 118 to 1-19]
A. Customer loyalty and retention. The benefits of customer loyalty come from
continued patronage of loyal customers, reduced marketing costs, decreased price
sensitivity of loyal customers, and partnership activities of loyal customers. Loyal
customers purchase from the business they are loyal to more often than nonloyal
customers. They also purchase a broader variety of items. A manager who is loyal
to a hotel brand is more likely to place her company’s meetings with that hotel
chain. Reduced marketing costs are the result of requiring fewer marketing dollars
to maintain a customer than to create one and the creation of new customers
through the positive word-of-mouth of loyal customers.
B. Growing share of customer. Beyond simply retaining good customers to
capture customer lifetime value, good customer relationship management can help
marketers to increase their share of customer—the share they get of the
customer’s purchasing in their product categories.
C. Building customer equity. Customer equity is the discounted lifetime values of
all the company’s current and potential customers. One builds customer equity by
delivering products that create high customer satisfaction and have high-perceived
value.
X. The Changing Marketing Landscape.
A. The digital age: online, mobile, and social media marketing. The explosive
growth in digital technology has fundamentally changed the way we live—how
we communicate, share information, access entertainment, and shop.
B. The changing economic environment. The new consumer spending values
emphasize simpler living and more value for the dollar. Despite their rebounding
means, consumers continue to buy less, clip more coupons, swipe their credit
cards less, and put more in the bank.
C. Rapid globalization. Today, almost every company, large or small, is touched
in some way by global competition.
D. Sustainable marketing. As the worldwide consumerism and environmentalism
movements mature, today’s marketers are being called on to develop sustainable
marketing practices.
E. Cocreation. Cocreation involves the hospitality or travel company interacting
with the guest to create experiences through this interaction.
F. The sharing economy. The recent surge in the sharing economy has been in
part to individuals sharing talents, time, and tangible assets they own to gain
additional income and the Internet enabling them to connect with customers.
Chapter 2: Services
Chapter Outline
I. The Service Culture. The service culture focuses on serving and satisfying the customer. The service
culture has to start with top management and flow down.
II. Five Characteristics of Services [Slide 2-3]
A. Intangibility. Unlike physical products, services cannot be seen, tasted, felt, heard, or
smelled before they are purchased. To reduce uncertainty caused by intangibility, buyers look
for tangible evidence that will provide information and confidence about the service.
B. Inseparability. In most hospitality services, both the service provider and the customer must
be present for the transaction to occur. Customer-contact employees are part of the product.
Inseparability also means that customers are part of the product. The third implication of
inseparability is that customers and employees must understand the service delivery system.
C. Variability. Service quality depends on who provides the services and when and where they
are provided. Services are produced and consumed simultaneously. Fluctuating demand makes
it difficult to deliver consistent products during periods of peak demand. The high degree of
contact between the service provider and the guest means that product consistency depends on
the service provider’s skills and performance at the time of the exchange. [Slide 2-4]
D. Perishability. Services cannot be stored. If service providers are to maximize revenue, they
must manage capacity and demand because they cannot carry forward unsold inventory.
III. Service Management Concepts
A. Service Profit Chain [Slide 2-5]
B. Types of Marketing [Slide 2-6]
1.Internal Marketing
2.External Marketing
3.Interactive Marketing
IV. Management Strategies for Service Businesses [Slide 2-7]
A. Managing differentiation. The solution to price competition is to develop a differentiated
offering. The offer can include innovative features that set one company’s offer apart from that
of its competitors.
B. Managing service quality. With hospitality products, quality is measured by how well
customer expectations are met. [Slide 2-8]
C. Manage Service Productivity
D. Resolving customer complaints. Resolving customer complaints is a critical component of
customer retention.
E. Managing employees as part of the product. In the hospitality industry, employees are a
critical part of the product and marketing mix. The human resource and marketing department
must work closely together. The task of internal marketing to employees involves the effective
training and motivation of customer-contact employees and supporting service personnel.
F. Managing perceived risk. The high risk that people perceive when purchasing hospitality
products increases loyalty to companies that have provided them with a consistent product in
the past.
G. Managing capacity and demand. Because services are perishable, managing capacity and
demand is a key function of hospitality marketing. First, services must adjust their operating
systems to enable the business to operate at maximum capacity. Second, they must remember
that their goal is to create satisfied customers. Research has shown that customer complaints
increase when service firms operate above 80 percent of their capacity. [Slides 2-9 to 2-10]
Marke&ng for Hospitality and Tourism
TCA 380
Dr. Tony L. Henthorne
Service Characteris-cs of Hospitality and Tourism
Marke-ng
Chapter 2
Learning Objectives
1. Describe a service culture.
2. Identify four service characteristics
that affect the marketing of a
hospitality or travel product.
3. Explain seven marketing strategies
for service businesses.
The Service Culture
Characteris&cs
of Services
Steps to Reduce Variability
Invest in good hiring
& training
procedures
Standardize
The serviceperformance
process
Monitor
Customer
Sa&sfac&on
The Service Profit Chain
Internal service
quality
Sa&sfied and
loyal customers
Sa&sfied and
produc&ve
service
employees
Healthy service
profits and
growth
Greater service
value
Types of Marketing
Internal
Marketing
Service
Marketing
Interactive
Marketing
Marketing Strategies
Service
Differen&a&on
Employees
As Part Of
The Product
Service
Quality
Service
Produc&vity
Perceived
Risk
Capacity
and
Demand
Customer
Complaints
Recommendations for
Improving
Service Quality
1. Listening
2. Reliability
3. Basic service
4. Service design
5. Recovery
Recommendations for
Improving
Service Quality (cont.)
6. Surprising customers
7. Fair play
8. Teamwork
9. Employee research
10.Servant leadership
Capacity Management
Involve the Customer in the Service Delivery System
Cross-Train Employees
Use Part-Time Employees
Rent or Share Extra Facilities and Equipment
Schedule Downtime During Periods of Low Demand
Change the Service Delivery System
Demand Management
Use Price to Create or Reduce Demand
Use Reservations
Overbook
Revenue Management
Demand Management (cont.)
Use Queuing
Shift Demand
Create Promotional Events
Tips for Managing Waiting
Lines
1. Unoccupied time feels longer than
occupied time.
2. Unfair waits are longer than
equitable waits.
3. Uncertain waits are longer than
known, finite waits.

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