Destination Management: University of Applied Sciences Stralsund Leisure and Tourism Management WS 2009/2010

Destination Management
Lecture 7
University of Applied Sciences Stralsund

Leisure and Tourism Management
WS 2009/2010
Slide Nr. 1
Part Three
Considers the challenges involved in managing attractions

such as marketing, financial management, operations
management and human resource management
Slide Nr. 2
The Marketing Concept
Slide Nr. 3
Growing need for marketing concepts
• Dramatic changes of economic structures

- industrial societies => service oriented societies
- more innovative and marketing orientated
• Changing nature of market and customer behaviour
• Recessions, forcing organizations to be more critical
• Privatization of previously state owned organizations
• Government pressure on local authorities
Part Three \ The marketing concept Slide Nr. 4

Approaches to marketing
• Production approach
- concentration on low cost production and effective
distribution
• Product approach
- emphasis on product improvement
• Selling approach
- carrying out substantial promotional and selling activities
• Marketing approach and market-led approach

- identifying the customer wants and needs
and deliver the most satisfying product

Visitor attractions as service products
1. Staff is part of the product itself

- attitudes and behaviour affect enjoyment
2. Intangible elements dominate the attraction product

- encourage to buy on basis of an imagination
3. The product is perishable

- ensure consumption/income before product perishes
4. Customers are part of the production process

- affects on experience are largely outside control
5. Service products are never really standardized

- quality control difficult; guarantees??

visitor attractions and tourism marketing
• The product is an experience

- that begins in advance of consumption and continues …
- visitors rarely distinguish between responsibilities
• The product offers only shared use rights

- try to avoid conflicts between different groups
• The product offers only temporary use rights

- “the longer the stay the higher the spending”
• The product is rarely being delivered to the customer

- good signposting, directions and brochures are essential
• The demand for the product is highly seasonal

Key factors in visitor attraction marketing
• The marketing objectives are very varied

- depending usually on the ownership (sector)
• Attractions are also marketed by other people

- tour operators, local authorities, tourist boards …
• The level of competition varies dramatically
• Many key factors in the visitors experience are outside

the control of attraction operators
• Visitor usage rates vary dramatically
• Attractions tend to have high fixed costs

Strategic Marketing Planning
Slide Nr. 9
Value of strategic marketing planning
• Forcing to clarify company‘s mission and look to the future
• Making sure attractions consider their competitorss
• Pinpointing the organization‘s strengths and weaknesses
• Identifying market threats and opportunities
• The effective allocation of resources
• Allocating responsibilities to individual members of staff
• Guiding day-to-day marketing activities
• Ensuring evaluation of performance
Part Three \ Strategic marketing planning Slide Nr. 10

Scope of strategic marketing planning !!!
• Where are we now?

- analysing the organizations current situation and direction
• Where do we want to be in the future?

- establishing mission statements, setting goals and objectives
• How are we going to get there?

- devising strategies and tactics helping to achieve these goals
and objectives, and looking at implementation issues
• How will we know when we get there?

- monitoring and performance evaluation strategies,
and systems for modifying strategies in response to monitoring

Where are we now?

Where are we now?
• A number of techniques are available to help identifying

the current situation of the attraction including
• SWOT analysis,
• Boston Consulting Group matrix,
• Product life cycle,
• Market segmentation and
• Product positioning.
Part Three \ Strategic marketing planning \ Where are we now? Slide Nr. 13
SWOT ANALYSIS
Slide Nr. 14
What is a SWOT analysis?
Objective:
Identify the gap between
the current situation of the business and the
direction in which the market moves.
• SWOT is a useful framework to assess a

Organization’s -:
- STRENGHTHS
- WEAKNESSES
- OPPORTUNITIES
- THREATS
Strengths, weaknesses, opportunities and threats
• The strengths and weaknesses within an organisation

- are usually internal factors
- that are within the control of the organisation
- point out the current situation of the business
• … These are generally internal factors, which are

responsible for the success of the attraction and can relate
to the rides provided, the location of the attraction and the
staff who run and operate the attraction
Strengths, weaknesses, opportunities and threats
• Opportunities and threats are factors

- that are essentially external environmental factors
- and exist outside the control of the organisation
- identify the direction in which the market moves
• For example, products offered by competitors or

market forces such as seasonal fluctuations, which
affect the demand for a product.
SWOT analysis
Strengths Weaknesses
internal factors
within control
(current situation)
Opportunities Threats
external factors
outside control
(market direction)
SWOT Exercise
Q4 Assign the following statements for an outline SWOT analysis of a visitor attraction
(e.g. theme park) to the four sections of the matrix. (2 statements for each section)
(8pt)
1. Rising amount of income spent on leisure time
2. Domestic competition with nearby attractions

Strengths Weaknesses
3. Decline in profitability
4. Low turnover of staff 4 3

5. Rise in population taking short breaks 8 7
6. Growing participation in thrill sports Opportunities Threats
7. Few intermediate rides for parents 1 2

8. Growing corporate hospitality 5 6
Strengths
• Examples for Strengths
- low turnover of permanent staff

- located near motorway junction
- 3 million people within 1-hour drive time
- unique collection of rides
- increased sales
- creative organisation
Weaknesses
• Examples for Weaknesses
- decline in profitability
- growing crime figures
- training of seasonal staff
- joint marketing
- food outlets
Opportunities
• Examples for Opportunities
- growth of population within 1-hour drive time

- growth of proportion of population taking short breaks
- new air services from Amsterdam and Madrid bring
additional overseas visitors to the U.K.
- major hotel group seeking partnership
- increasing disposable income spent on entertainment
- rising internet booking
Threats
• Examples for Threats
- government policies
- natural calamities
- terrorism
- recession forecast
Difficulties when carrying out SWOT analysis
• It is sometimes very difficult to decide whether

an item is a strength or a weakness.
- E.g. “low turnover of staff" could be a strength but also a weakness
when masking the fact that the staff are inflexible, inwardly focused
and not creative
• Another example in the analysis, which could be viewed

as a strength or a weakness, is the location of the park
near a motorway junction. This would make the attraction
much easier to travel to and therefore is a strength. But it
could also be a weakness, because it gives potential
customers a greater choice of entertainment destinations.
What to do with the SWOT?
• Every section holds potential to put forward strategies
• For example, weaknesses and threats can be converted

to strengths and opportunities. Whilst strengths can be
matched to opportunities.
Weakness:
few visitors in
off-peak season Conversion Strategy:
attract school-group visits at

low fares in off-peak season Strengths:
- balanced cash flow

- loyal visitors (return visits)
- grater awareness (parents, relatives)
- sanitised public image
- ….
Conversion strategy Exercise
Q5 The “Tropical Islands Dome”, located at the edge (periphery) of the tourist destination
“Spreewald” between Berlin (50 km) and Dresden (100 km), opened on Dec 18, 2004.
As the attraction does not dispose of any on-site accommodation facilities,
only (one) day visitors can be attracted.
Develop a conversion strategy

and name three possible strengths resulting of your strategy.
(8pt)
conversion strategy: -- partnership/co-operation with nearby hotels 2pt
resulting strengths: -- high attractiveness of the product (by packages) 1pt + 1pt
-- strong marketing partners (increasing awareness) 1pt + 1pt
-- diversified distribution channels (hotels as intermediaries) 1pt + 1pt
-- diversified income generation (commission for bookings) …
Conversion strategy Exercise
valuable SWOT analysis requires
• be objective in developing strengths and weaknesses and

realistic in assigning opportunities and threats.
• carry out customer focused questionnaires, also with

internal customers (staff), other stakeholders such as
suppliers and promotional agencies.
• cross-functional team SWOT analysis
Staff Customers
SWOT
Analysis
Suppliers Agencies
Boston Consulting Group (BCG) matrix
• Whereas SWOT analysis looks at the organization as a whole

BCG matrix focuses on a range of product or services
= portfolio analysis
High
• Examines products
in terms of: Question
Stars
- their market share marks
Market growth
- market growth
Cash Poor
• Important question: cows dogs
How to define
Low
the product? max

Relative market share
min
Boston Consulting Group (BCG) matrix
• Stars
- providing stable profits but are threatened by competitors
- need to focus on maintaining competitive advantage!
• Question marks
- old, uncompetitive products or brand-new ones without awareness
- danger to become ‚poor dogs‘ and chance to become ‚stars‘ resp.
• Cash cows
- steady generators of cashflow
and therefore vital to organizations
• Poor dogs
- best option is to stop providing the product or to sell it
- sometimes kept to put pressure on competitors ‚cash cows‘
Why to apply BCG matrix?
• Beside helping organizations to assess their current

position it also supports:
• the management of cashflow and the planning of

investment;
• acquisition and diversification policies;
• the analysis of the organization‘s human resources

in terms of their expertise and experience so that potential
future strengths and weaknesses can be identified.
Problems when applying BCG matrix
• There is often no competitive market

- e.g. in the case of local authority museums or sports centres
• Market share can often not be measured

- markets are often ill-defined or impossible to measure at all
• Model is based on the idea of rational decision making

- in the public and voluntary sector strategy decisions
often depend on political and social objectives and not on
seeking to maximize financial performance
Product life-cycle
In marketing terms the current stage in product life-cycle is

important for two main reasons:
• The type of customer is different at different stages

- marketing media and marketing message will likewise
be different at each stage of the PLC
• Need to recognize when to ‚re-launch‘ the product

- implies significant investments over normal costs
Market segmentation
• The aim is to see:

- how the market segments relate to the current trends
- what gaps exist between the current situation and the
way the market is moving
• Devise strategies to bridge or close these gaps
• current major market segment: young family

demographic trends indicate growth in older age groups
develop marketing strategies attracting elder visitors
Product positioning
• Where customers perceive you to be in the marketplace

Exciting Theme Park Exciting
( )
Inexpensive
Inexpensive
Expensive
Expensive
Boring Boring
Positioning disparity Competitor analysis
• If there are disparities between the customer and the

manager‘s viewpoint:
- change the market or the product in order to
reflect/match the views of the customers!
Research strategies
• Visitor numbers and a profile of existing customers,

ex-customers, and non-users
• Visitor‘s perceptions and opinions on the attraction
• Objective information on the organization and how it

operates
• Up-to-date information on competitors and their

performance
• A thorough appreciation of the position of the attraction in

the market place as a whole
• An understanding of likely macro-environmental changes

Questions to consider when conducting surveys
As most of the data required for analysing the current

situation are simply not available, surveys can help to
gather information
• Who will carry out the surveys
• When and how often they will be carried out
• How many people will be surveyed and how they will be

chosen to ensure that the sample is representative
• What questions to ask
• How to analyse the results of the survey

Where do we want to be in the future?

Sequence of steps
• Defining the future business

- often means continuing within the existing parameters
• Mission statement
- what direction to take and how to be seen by the market
• Goals and objectives

- e.g. for revenues, profit, awareness, visitor numbers,
quality of service, competitive advantage, market share
- usually concrete targets for evaluating success or failure
Part Three \ Strategic marketing planning \ Where do we want to be in the future? Slide Nr. 39
Please remember:
Slide Nr. 40

Destination Management: University of Applied Sciences Stralsund Leisure and Tourism Management WS 2009/2010

Încărcat de

Informații document

Titlu original

Drepturi de autor

Formate disponibile

Partajați acest document

Partajați sau inserați document

Opțiuni de partajare

Vi se pare util acest document?

Este necorespunzător acest conținut?

Drepturi de autor:

Formate disponibile

Destination Management: University of Applied Sciences Stralsund Leisure and Tourism Management WS 2009/2010

Încărcat de

Drepturi de autor:

Formate disponibile

Destination Management

University of Applied Sciences Stralsund

Considers the challenges involved in managing attractions

• Dramatic changes of economic structures

• Changing nature of market and customer behaviour

• Recessions, forcing organizations to be more critical

• Privatization of previously state owned organizations

• Government pressure on local authorities

Part Three \ The marketing concept Slide Nr. 4

• Marketing approach and market-led approach

Part Three \ The marketing concept Slide Nr. 5

1. Staff is part of the product itself

2. Intangible elements dominate the attraction product

3. The product is perishable

4. Customers are part of the production process

5. Service products are never really standardized

Part Three \ The marketing concept Slide Nr. 6

• The product is an experience

• The product offers only shared use rights

• The product offers only temporary use rights

• The product is rarely being delivered to the customer

• The demand for the product is highly seasonal

Part Three \ The marketing concept Slide Nr. 7

• The marketing objectives are very varied

• Attractions are also marketed by other people

• The level of competition varies dramatically

• Many key factors in the visitors experience are outside

• Visitor usage rates vary dramatically

• Attractions tend to have high fixed costs

Part Three \ The marketing concept Slide Nr. 8

• Forcing to clarify company‘s mission and look to the future

• Making sure attractions consider their competitorss

• Pinpointing the organization‘s strengths and weaknesses

• Identifying market threats and opportunities

• The effective allocation of resources

• Allocating responsibilities to individual members of staff

• Guiding day-to-day marketing activities

• Ensuring evaluation of performance

Part Three \ Strategic marketing planning Slide Nr. 10

• Where are we now?

• Where do we want to be in the future?

• How are we going to get there?

• How will we know when we get there?

Part Three \ Strategic marketing planning Slide Nr. 11

Part Three \ Strategic marketing planning Slide Nr. 12

• A number of techniques are available to help identifying

• Boston Consulting Group matrix,

• Product life cycle,

• Market segmentation and

• SWOT is a useful framework to assess a

• The strengths and weaknesses within an organisation

- point out the current situation of the business

• … These are generally internal factors, which are

• Opportunities and threats are factors

• For example, products offered by competitors or

1. Rising amount of income spent on leisure time

2. Domestic competition with nearby attractions

4. Low turnover of staff 4 3

7. Few intermediate rides for parents 1 2

• Examples for Strengths

- low turnover of permanent staff

• Examples for Weaknesses

• Examples for Opportunities