Tourism Marketing Principles

TOURISM MARKETING PRINCIPLES

Executive summary

The different marketing strategies are tools are used to sell and market the services to the targeted audience is tourism marketing. They include certain amenities with their packages to attract the customers.

In this project the topics which are covered is the introduction the tourism industry. The travel agency which is selected for the discussion of the marketing principles is Riviera travels, which is UK, based company and provide travel packages for holidays in cruise to travel in Europe. It also provides the whole background of the agency.

This project discusses the internal as well as external factors which will affect the organizational decisions and helps to set and improve organizational management system. There is in-depth knowledge of all the factors and strategy used by the organisation for the growth of the agency. In external factors the discussed factors are the threat to new industry, the bargaining power of supplier, the threat of substitution, customer’s bargaining power, the threat of customers shifting to substitute products or services. In internal factors the factors to be discussed are segmentation, targeting and placing. This also helps to know the overview of the company’s competitors and can sustain in the long run. (Sotiriadis 2020)

This project also discussed the AI tools used by the company for the growth of the company. How AI tools make the work easy for the company. All these topics are discussed in detail to know the overview of the company.

Company Background

Riviera travels is a tourism industry which is a basically from United Kingdom. They provide the luxury European cruise and tour operator to their customers. Five star hotels are also included in their package. This organisation was established in early 1980s. The founder of Riviera travels is Michae Wright. In the start it is supported by private equity firm Phoenix Equity Partners in 2014. They completed their 40 years in tours and travels. Riviera travel’s is owned by the silver fleet Capital (Riviera travels, 2024).

Nowadays cruise travelling is highly in demand so many first-time cruise travellers are opting for Riviera travels. They provide different tour packages to different countries, according to tailor made. They have different rivers throughout the Europe. If a person likes to visit Danube River than they can visit places like Vienna, Budapest, and Bratislava. If a person wants to visit Rhine River than they can enjoy castles, fortresses and villages like Rudeshem and Koblenz.

Riviera travels offers a full package which includes flight tickets, 5 star hotels, one time meal, a local guide, a tour manager and other benefits. They also provide packages for worldwide destinations. The package includes variety of superior drinks during their meals. They also provide travel protection plan. Their major destination spot are in Europe, India, and South Africa.

The bookings can be done through digitally or through tradition way. Platforms for digital bookings are “AirBnb and Booking.com”. The traditional way is through brochures and call centers (Riviera travels, 2022).

External Analysis

An industry has many organizations. So it also has many competitors. Riviera also have its competitors. Such competitors can be analyzed through Porter’s five forces (Bruijl, 2022).

Porter’s five forces is an organizational rule that helps to analyze and identify company’s competitors. It helps the organisation to know its competitors and then prepare module to increase the profitability in the market. The five factors of Porter’s are-

1. The threat of new entry to the industry

2. The threat of substitution

3. Supplier’s bargaining power

4. Customer bargaining power

5. The threat of customers shifting to substitute products or services.

These all will be termed as external factors as it affects the organisation externally. Nowadays cut throat competition is going. And people like to travel and explore a lot. So many tourism companies are coming day by day. Many people want best packages at affordable prices. They can compare from different organisation so that they can choose one amongst them (Rizki, et al, 2021).

Riviera also faces such competition and uses the porter’s five factor for its analysis.

1. The threat to new entry to the industry- The threat to new industry mainly depends on the entry barrier to the outside company. If there is no barrier in entry and exit then there will be many competitors to the existing companies. Riviera also faces this threat. Capital requirement for starting this business is high. It needs trust and loyalty among the suppliers and buyers. They need capital for timely payment for suppliers. Over the period of time customers also started to trust the agency with their quality of services. These lead to decrease of threats. Government policies also have big role in entry of agencies. Agencies should have compliance of certain licensing than only they can enter (Khan, et al, 2020).

2. The threat of substitution- There are many travel agencies in UK who provide tailor made package for its customers. Many customers wants best package with affordable price. The main competitor of Riviera is Hays travels. There is certain other competitor as well such as new market holidays, Peaks travel elite. But this threat can be resolve by creating trust and providing quality services.

3. Supplier’s bargaining power- The bargaining power of supplier can be a threat to Riviera travels. As if they depend on one supplier for their services like hotel bookings or tour guide, they can demand higher prices or can reduce the quality of meals provided, and then the trust developed on the agency will lose. So to overcome the threat agency need to have multiple options so that can maintain quality of services.

4. Customer’s bargaining power- Customers wants great package with lower prices. So they bargain with the agencies. As the Riviera is working for over 40 years it had created some potential customers and the online reviews are good, so the new travellers do not bargain much after knowing about their quality services.

5. The threat of customers shifting to substitute products or services- When the Riviera was started not many travel agencies was started. So the possibility to shift to other travel agencies was not possible. But after the entry of other agencies in UK like Insight vacations travel agency the possibility to shift becomes higher. But Riviera is an old agency so it gives them upper hand to be in top of the market due to better service providence and by giving extra benefits in travel package like travel insurance or tailor made packages.

Internal Analysis

Internal analysis is done when the company needs to focus on internal ways of marketing of an organisation. If the management within the organisation is not efficient then the company cannot sustain in long run. There is a marketing strategy that should be done inside the organisation to maintain the work effectively and efficiently. The tools for internal marketing analysis are-

1. Segmentation

2. Targeting

3. Positioning

Riviera travels also needs to maintain and analyze the within the agency strategies to work efficiently and make the agency profitable. The tools of segmentation, targeting and positioning are applied as-

1. Segmentation- Segmentation is defined as when the market is divided into certain groups of customers on the basis of lifestyle, income, behavior and many more. Riviera travels have also applied segmentation in their agency. They create segments based on the factors such as destination interest, income, travel habits, preferences. If a family wants to travel Danube River through cruise then the packages available will be depending on following factors like, what would be the budget of the family, so the agency will provide them a package according to them. If they don’t have any money problem then agency will provide business flight tickets, book a 5star hotel, a good room in cruise and many more facilities (Liu, and Shan, 2021)

2. Targeting- Targeting means to select a specific segment from the segments which an agency has decided. This lead to prioritize the selected segments for their objectives. Riviera choses luxury travelers among the different segments so that it can maintain its authenticity top class packages over the years during the holiday sessions. When there is off Season Company give discount to customers on the hotel bookings so that their business can continue in off seasons too. They also made tailor made packages to its customers who are from other countries.

3. Positioning- Positioning defines as the planned and formulated effort to make and maintain the image appealing to the targeted audience and to attract the new customers to their side. It also helps to maintain the tough competition from its customers. It is the most important strategy for the company, as it helps to sustain in the long run (Ma, Kuang, 2022)

Riviera travels use the positioning strategy a lot. Riviera uses social media platform for its marketing. As social media is growing rapidly in today’s society, so it helps them to maintain and attract its customers through their websites, or post the advertisement on social media handles. Positioning helps to find out the agency, whose travellers wants luxury experience. As it is a reliable source for its customers they gain more customers through this. They do conduct 120 travel guides, video tours and other tools.

By applying STP (Segmentation, Targeting, and Positioning) Riviera travels has increased by over 1200% in a year through various modes (Fernández and et al, 2020)

Difference between Riviera with its competitors (CB Insights, 2024)

Key Differences	Riviera Travels	Six Star Luxury cruise	Vikinc Cruise	Ambassador Cruise line
Origin	It is based in UK	It is based in US	It is based in US	It is based in UK
Years	It is 40 years old company	It is 35 years old company	It is 28 years old company	It is 41 years old company
Services	It provides European river cruise, yacht cruise, and tailor made tours for solo travellers.	It provides large ship as well as small ships experiences with other amenities with discount	They provide packages which includes European rivers, Asian waterways, and to the polar regions.	They provides cruise services which includes themed, world tour and many more.
Customers	This agency is for who afford luxury packages and mainly from UK.	This agency is for high end as well as middle class persons.	The customers are mainly US based and middle class persons.	This agency is for who afford luxury packages and from all over the world.

AI Marketing and Sustainable Marketing Practices

In today’s era artificial intelligence is highly growing. Mainly work is dependent upon the artificial intelligence. This removes the slightest chance of mistake and helps to get the work done effectively and efficiently.

In tourism industry, no innovation has brought a tremendous change in industry as AI has made. At present almost all tourism companies uses this method. Through this technology it is projected to reach its market demand to $1.2 billion by 2026.

AI in marketing is a method to simplify the working by using tools such as algorithms, certain specified models, and technology to obtain market details, customize the details, and personalized the details (Ivanov and Webster, 2017)

Riviera travels use the AI tool to obtain the detailed information of the targeted customers.

Tools used by Riviera are-

1. Market Muse- Riviera use this tool to create a proper content for the website and social media. It helps them to attract the customers after reading the quality content.

2. Bigtincan- Riviera use this tool to increase marketing and sales of the in the market. It helps them to create more efficient meetings for the sales team.

3. Albert AI- this tool helps them to identify the challenges in digital advertisement and solve the issues their only. It also helps them to create personalized ads to share that to the targeted audience.

Reference

Bruijl, Dr.G.H.Th, (2022). The Relevance of Porter’s Five Forces in Today’s Innovative and Changing Business Environment. Journal of Marketing Management and Consumer Behaviour, 4(1). (Brief reference).

Fernández, J.A.S., Azevedo, P.S., Martín, J.M.M. and Martín, J.A.R., 2020. Determinants of tourism destination competitiveness in the countries most visited by international tourists: Proposal of a synthetic index. Tourism Management Perspectives, 33, p.100582 https://doi.org/10.1016/j.tmp.2019.100582.

Ivanov, S.H. and Webster, C., 2017. Adoption of robots, artificial intelligence and service automation by travel, tourism and hospitality companies–a cost-benefit analysis. Artificial Intelligence and Service Automation by Travel, Tourism and Hospitality Companies–A Cost-Benefit Analysis https://ssrn.com/abstract=3007577.

Khan, N., Hassan, A.U., Fahad, S. and Naushad, M., 2020. Factors affecting tourism industry and its impacts on global economy of the world. Available at SSRN 3559353. https://dx.doi.org/10.2139/ssrn.3559353.

Liu, Y. and Shan, H,(2021). Fresh Fruit Time based on STP analysis and statistics method (Changchun) Word-of-mouth marketing strategy research. E3S Web of Conferences, 233, p.02055 doi:https://doi.org/10.1051/e3sconf/202123302055.

Ma, L. and Kuang, J. (2022). Research on Tourism Short Video Marketing Strategy Based on STP Theory. Advances in Economics and Management Research, 2(1), p.20 doi:https://doi.org/10.56028/aemr.2.1.20.

Riviera Travel. (2022). Award-winning escorted tours, cruises and solo holidays. [online] Available at: https://www.rivieratravel.co.uk/ [Accessed 20 Sep. 2024].

Rivierarivercruises.com. (2024). Home | Riviera River Cruises. [online] Available at: https://www.rivierarivercruises.com/ [Accessed 20 Sep. 2024].

Rizki, M., Ghifari, A., Hui, W.L., Permata, E.G., Siregar, Mhd.D., Umam, M.I.H. and Harpito, H. (2021). Determining Marketing Strategy At LPP TVRI Riau Using SWOT Analysis Method. Journal of Applied Engineering and Technological Science (JAETS), 3(1), pp.10–18 Doi:https://doi.org/10.37385/jaets.v3i1.276.

Sotiriadis, M., 2020. Tourism destination marketing: Academic knowledge. Encyclopaedia, 1(1), (pp.42-56) https://doi.org/10.3390/encyclopedia1010007