Chapter 8. Services Marketing
8.8 Conclusion
Effective services marketing in the tourism and hospitality sector requires marketers to gain a solid understanding of the differences between the marketing of goods, services, and experiences. Successful organizations use market research to learn the preferences and behaviours of key customer segments. Through a strategic planning process, organizations and destinations develop a marketing orientation designed to identify customer needs and trigger their wants, while striving to meet organizational objectives. Activities are designed to support integrated marketing communications across multiple platforms with reciprocal communications — that is, not just broadcasting information, but having conversations with customers. Savvy marketers will leverage these conversations to keep up with evolving customer interests while seeking an understanding of emerging trends in order to anticipate needs and wants. Engaged marketers also know that social media and integrated marketing communications must be complemented with remarkable customer service, which ultimately supports successful marketing strategy.
Chapter 9 will delve further into the components of delivering exceptional customer service as a key component of industry success.
Key Terms
- 8 Ps of services marketing: refers to product, place, promotion, pricing, people, programming, partnership, and physical evidence
- Advertorial: print content (sometimes now appearing online) that is a combination of an editorial feature and paid advertising
- Customer needs: gaps between what customers have and what they would like to have
- Customer wants: needs of which customers are aware
- E-commerce: electronic commerce; performing business transactions online while collecting rich data about consumers
- Emerging markets: markets for BC that are monitored and explored by Destination BC — China, India, and Mexico
- Heterogeneous: variable, a generic difference shared by all services
- Influencers: individuals with a strong online presence and following who can use their knowledge, authority, and relationships with followers to share brand-aligned content and inspire travellers to visit or purchase
- Intangible: untouchable, a characteristic shared by all services
- Integrated marketing communications (IMC): planning and coordinating all the promotional mix elements and internet marketing so they are as consistent and as mutually supportive as possible
- Interactive media: online and mobile platforms
- Interpersonal factors: the influence of cultures, social classes, family, and opinion leaders on consumers
- Marketing: a continuous, sequential process through which management plans, researches, implements, controls, and evaluates activities designed to satisfy the customers’ needs and wants, and its own organization’s objectives
- Marketing orientation: the understanding that a company needs to engage with its markets in order to refine its products and services, and promotional efforts
- Market segmentation: specific groups of people with a similar profile, allowing marketers to target their messaging
- Mass media: the use of channels that reach very large markets
- Nearby markets: markets for BC, identified by Destination BC as BC, Alberta, and Washington State, characterized by high volume and strong repeat visitation; sometimes referred to as ‘short haul’ markets
- Net promoter score (NPS): a metric designed to monitor customer engagement, reflecting the likelihood that travellers will recommend a destination to friends, family, or colleagues
- Out-of-home (OOH): channels in four major categories: billboards, transit, alternative outdoor, and street furniture
- Passive customer: a guest who is satisfied (won’t complain, but won’t celebrate the business either)
- Perishable: something that is only good for a short period of time, a characteristic shared by all services
- Personal factors: the needs, wants, motivations, previous experiences, and objectives of consumers that they bring into the decision-making process
- PRICE concept: an acronym that helps marketers remember the need to plan, research, implement, control, and evaluate the components of their marketing plan
- Psychographics: psychological characteristics, such as an individuals attitudes, beliefs, values, motivations, and behaviours
- Print media: newspapers, magazines, journals, and directories
- Services marketing: marketing that specifically applies to services such as those provided by the tourism and hospitality industries; differs from the marketing of goods
- Services marketing triangle: a model for understanding the relationship between the company, its employees, and the customer; differs from traditional marketing where the business speaks directly to the consumer
- Social media: refers to web-based and mobile applications used for social interaction and the exchange of content
- Societal marketing: marketing that recognizes a company’s place in society and its responsibility to citizens (or at least the appearance thereof)
- Tangible: goods the customer can see, feel, and/or taste ahead of payment
- Top priority markets: markets for BC identified as a top priority for Destination BC — ‘long haul’ markets such as Ontario and California, as well as international markets such as Germany, Japan, United Kingdom, South Korea, Australia — characterized by high revenue and high spend per visitor
- Tourism marketing system: an approach that guides the planning, execution, and evaluation of tourism marketing efforts (PRICE concept is an approach to this)
- Word of mouth: information about a service experience passed along orally or through other social information sources from past customers to potential customers
Exercises
- Fill in the blanks for the acronym PRICE. During a successful marketing planning process, management will:
- P
- R
- I
- C
- E
- Should services be marketed exactly the same as manufactured products and packaged goods? Why or why not?
- Name at least three reasons for tourism marketers to do marketing research.
- Why is segmentation so important to effective marketing?
- What does integrated marketing communications achieve?
- What stages do customers usually go through when they make decisions about buying travel services?
- Name the three types of market priorities for British Columbia’s tourism experiences (according to Destination BC). What geographic segments are found in each?
- What is the net promoter score (NPS) for a destination with 20% detractors and 80% supporters?
- Why is delivering great experiences an important part of services marketing? Give five reasons.
- Take the Explorer Quotient (EQ) test. Review the EQ profile document to learn more about your traveller type.
- What characteristics do you agree with, which ones do you not? Why?
- Select one of the experiences (preferably in BC) matched to your profile and determine how it fits your type.
- How does the website of that company market to your traveller type? What visuals or key words do they use to get your attention?
Case Study 1: The Wickaninnish Inn
Located in Tofino, the Wickaninnish Inn (or “the Wick,” as it’s affectionately known) is a world-recognized high-end property famous for offering four seasons of luxury experiences on BC’s “wild coast.” But how does the Wick stay top-of-mind with tourism consumers? A quick look at their marketing mix offers some answers:
- Product: The inn has long been a leader in offering experiences that go above and beyond a room in a luxury hotel, starting with their storm-watching packages in the late fall, a time that was once their off-season.
- Place: Reservations can be made online on the inn’s website, via a toll-free number, through OTA sites including TripAdvisor (where reviews are constantly monitored in order to engage with customers), and other reservation services including the HelloBC program. The staff constantly engages with, and monitors their customers, tracking trends in traveller purchasing behaviour to ensure it is front and centre with the inn’s target markets.
- Promotion: The inn has a well-maintained, visually rich website and social media presence on Instagram, Twitter, Facebook, YouTube, Pinterest, Google+, and Flickr (a presence that shifts constantly depending on where consumers can be found online). Its site features a media page with blogs, press releases, and high-resolution photos and videos to ensure journalists can easily post a story at any time.
- Pricing: The inn has a comprehensive revenue management and pricing plan that includes packaging and promotions for all seasons. The pricing reflects offering value to guests, while confidently staying at the higher end of the scale.
- People: Not only does the inn attract and train staff who deliver on its promise of exceptional experiences, the Wick also has a multi-person team responsible for sales, marketing, and media (blogging, press releases, photography, hosting familiarization tours).
- Programming: Programs include packaging under themes such as elopement, natural, seasonal, romantic, spa, and culinary. Many packages include the involvement of hotel personnel such as an elopement coordinator or concierge to help guests plan specific value-added and memorable components of their experience, such as a last-minute wedding (Wickaninnish Inn, 2020).
- Partnership: The Wick partners with other experience providers and events such as the Tofino Saltwater Classic — a fishing tournament hosted by Brendan Morrison of the Vancouver Canucks. By supporting the event as a platinum sponsor (Tofino Saltwater Classic, 2020), the representatives from the inn meet new potential guests and solidifies its place in the community.
- Physical evidence: In addition to familiarization tours, the media team ensures the inn is considered for a number of high-profile awards, and celebrates wins by broadcasting these as they occur (e.g., Travel and Leisure Awards World’s Best Winner 2014). Prize logos are placed on the inn’s home page online, in print ads, and in physical locations on the property. The inn also has a regular consumer newsletter that celebrates achievements and shares promotions with past and future guests.
Thinking about this example, answer the following questions:
- Imagine the inn received a review on TripAdvisor that showed a customer was not satisfied. How might it deal with this?
- Visit the Wickaninnish Inn’s website. Who are the target customers? How is this conveyed on the site?
- What are the prices for packages and accommodations? What does the price signal to you about the experience you might have at this hotel?
- Do an online search for “Wick Inn” using your favourite search engine. What are the first five links that come up? How do these present the property? What hand does the inn’s staff have in these results?
- Look at the community of Tofino as it is presented online and name five potential partners for the Wick.
Case Study 2: Crisis Communication
Destination BC has faced its fair share of marketing challenges over the years including an ongoing homelessness crisis, devastating fires and, in 2020, the novel coronavirus pandemic. What can we learn about how they respond(ed) to these crises and communicate(d) with their range of stakeholders? The service marketing triangle can be a useful tool to examine Destination BCs response to the coronavirus pandemic:
- Internal marketing: Destination BC, in tandem with regional DMOs, provided regular bulletins, up-to-date website content, 24-hour email and call center assistance, live webinars and more to help industry partners access provincial and federal resources and align their consumer-facing messaging with provincial and federal travel guidelines.
- External marketing: In the early stages of the pandemic, Destination BC worked with provincial health authorities and regional DMOs, to leverage social media such as Twitter to send simple, clear messages directly to visitors and residents. For example, in March 2020, at the height of the crisis, they released messages with the hashtag: #ExploreBCLater… In early May 2020, as provincial restrictions lessened, they released messages with the hashtag: #ExploreBCLocal… And, as restrictions continued to lift in late May 2020, they revived a staple hashtag: #BCTourismMatters.
- Interactive marketing: Industry partners did their part by making the difficult decision to close their doors to visitors or operate in alignment with the provincial health guidelines. For example, Butchart Gardens provided a COVID-19 update on their website reminding visitors to enjoy the beauty of the gardens while maintaining appropriate physical distance (2m), following directional arrows on pathways, and listening to staff. Though regularly changing, these guidelines at time of publication can be found on the Butchart Gardens’ website.
Thinking about this example, answer the following questions:
- Analyze Destination BCs response. What did they do well and what could they have done differently during this particular crisis, or others?
- How did Did Destination BC use various communication channels to create, enable, and deliver on their promise to keep people safe and businesses solvent during the coronavirus pandemic?
- Visit California had a series of devastating fires in the late 2010s. Even though 99% of California’s wine country was still intact during a good portion of this time, the press was sending out the message that “Wine Country” had become “Fire Country”. What role does the media have on visitor perceptions of destinations?
- Look for examples online of how Visit California, like Destination BC, may have utilized the services marketing triangle to control the media narrative and deliver on its promise of safe and secure travel. As a starting point, you might look at Visit California’s Grateful Table experience, Share the Love video, Power of Love public service announcement, or West Coast Travel Facts to answer this question.
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Gaps between what customers have and what they would like to have.
Planning and coordinating all the promotional mix elements and internet marketing so they are as consistent and as mutually supportive as possible.
Tours provided to overseas travel agents, travel agencies, RTOs, and others to provide information about a certain product at no or minimal cost to participants. The short form is pronounced like the start of the word "family" (not as each individual letter).