Marketing Strategies for Tui Group's Sightseeing Division in Japan

Tui Group plans to open a sightseeing division in Japan, a popular destination for overseas travelers. The market size of the tourism industry is huge, with the number of visitors expected to reach 40 million by 2020. The company will target young generations and families with their segmentation strategies. Opportunities include joint venture agreements and the growing industry of hotels and motels, while threats include fluctuations in the economy and competition.

RUNNING HEAD: Marketing 0
tui group
Marketing
(Student Name)
12/19/2018

Marketing 1
Table of Contents
Section 1.....................................................................................................................................2
Background.............................................................................................................................2
Size of the Market..................................................................................................................2
Changes in Market..................................................................................................................3
Buying Pattern........................................................................................................................3
Segmentation strategies..........................................................................................................4
Section 2.....................................................................................................................................5
Opportunity.............................................................................................................................5
Threat......................................................................................................................................5
Bibliography...............................................................................................................................6

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Section 1
Background
Tui Group is considered as the leading integrated tourism provider in the country such as
Europe. The Tui Group are divided in three sectors which include Tui Hotels & Resorts, Tui
Travel, and Tui Cruises. The company is looking to extend their business by opening a
sightseeing division in Japan. Japan is one of the popular destinations for overseas traveller.
The company will able to provide services at local level and the pilot out of Japan tour that
provide the same attractions as like other three establishes sightseeing tour operators1.
Size of the Market
The Japanese past has an interesting history and rich in the events. The Japan is considered as
fascinating due to the presence of cutting edge technology along with an attractive
architecture as well as has still been able to maintain the tradition of the country. The value of
the domestic tourism is 20.9 trillion in the year 2016. Therefore, the market size of tourism
industry is huge due to the huge number of visitors, huge number of traveling companies
entered in the market.2
1 Clare Jenkinson and Hugh Felton. "15 Attractions." (2018)Tourism and Animal Welfare 135
2 Garcia-Villaverde, Pedro M., et al. "Determinants of radical innovation in clustered firms of the
hospitality and tourism industry." (2017) 61 International Journal of Hospitality Management 45-58.

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According to the analysis of Japan Tourism Organization, the number of visitors in the
country from overseas to visit Japan is estimated 2.1 million in the year of 2016 which has
increased to 31.7 per cent from the year 2015. This was one of the highest figures that were
recorded on the monthly basis as well as it was for the first time in the history that they tough
the figure of 2million. Therefore, the country has strongly focused on inbound tourism for the
past years. Japan has come under the top ten leading countries worldwide, based on the
international tourism receipts in 2017. It is expected that the number of population in tourism
industry will reach to 40 million by 2020.4
3 Statista, Japan Tourism Industry (2018) <https://www.statista.com/topics/4875/travel-and-tourism-industry-
in-japan/>
4 Ibid

Marketing 4
Changes in Market
The tourism industry in Japan has increase to 35 per cent in the past scenario and the
government of the country has targeted with the aimed to gain double tourist visitors by 2020.
In the article of McKinsey & Company, the consultancy firm determines the tourism industry
in Japan, perceiving a sum of factors constraining the incursion of visitors to the wide variety
of sites of country. Japan is considered as one of the world most attractive destination for the
tourist that offers “Cool Japan,” Fusin with Tradition.” There is certain new attraction sites
added with the existing places such as Tokyo Sky tree, Mt. Fuji, Shrines and Temples that are
old fashioned, hot springs as well as the cuisine of Japan. The hotels in Japan are also of high
quality that attract maximum tourist to visit with overall satisfaction.6
Buying Pattern
From the last five years, the number of tourist has been increased to 33 per cent in the market
of tourism of Japan which shows as increase in trend of tourist industry. The tourism of Japan
5 Export.Gov, Japan-Travel and Tourism (2018) <https://www.export.gov/article?id=Japan-Travel-Tourism>
6 Bynum B Boley, Naho Maruyama, and Kyle M. Woosnam. "Measuring empowerment in an eastern
context: Findings from Japan." (2015)Tourism Management 50 112-122.

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brings 900 billion yen in a year to the country which is significantly increased from last five
years. The number of Chinese visitors to Japan was approximately 4 billion in March that
was increased to 47.3 per cent. The changes in number of visitor are explained in below
diagram and graph
7
This represent that the number of visitors has been increased due to the change in buying
pattern as well as the Japan has an intense place which attracts the consumers at greater level.
The main reason of such enhancement was the approaching Sakura seasons as well as the
7 Tourism Statistics, Overseas Residents Visits to Japan (2018)
<https://www.tourism.jp/en/tourism-database/stats/inbound/>
8 Ibid

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Easter Holiday that increased the requirement to visit Japan. The increment in the tourist
industry will also provide an opportunity for the company to target maximum consumers.
They would able to deliver various kinds of services to their consumers at greater level.
Segmentation strategies
The company will target their consumers according to different segment. They will target the
segment of young generation and families due to the reason; they are the major influencing
segment in the tourism industry.
 The youth will visit with the friends; therefore, targeting one youth will help in
covering their remaining friends. This is the main strategy that company will use.
 Similarly, if company will target one member of family then they will able to cover
rest of the family members that would help the company to target maximum
consumers in limited time period.9
Section 2
Opportunity
 Joint Venture Agreements
The company will have an opportunity to tie-up with existing strong company that help them
to target maximum consumers in an effective manner.
 Growing Industry of Hotels and Motels
9 Stephen W Litvin, Ronald E. Goldsmith, and Bing Pan. "A retrospective view of electronic word-of-
mouth in hospitality and tourism management." ((2018) 30International Journal of Contemporary
Hospitality Management 1 313-325.

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The sector of hotels and motels has observed as a major growth in the recent years that will
create an opportunity for the company to target their consumers at maximum level10.
Justification
These opportunities are selected due to the reason that they play a vital role in the success of
the business. The growth in future will motivate the company to expand their business with
confidence.
Threat
 Fluctuation of Economy
The revenue of the company depends on the growth of the economy of the country. the
economy of the Japan has possibility to go down due to the reason of natural calamities. It
would affect the business of the company at greater level.
 Competition
The Japan is hub of tourist therefore; many firms are attracted towards such sector which
increases competition for the company in the market. Tui travels would face competition that
would affect the sale of the company at greater level. 11
Justification
The main reason for selecting these threat is, the fluctuation in the economy and completion
would affect the performance of the company at greater level therefore by analysing the
threat the company would able to prepare strong marketing strategies to survive in the market
in effective manner
10 Susan Horner and John Swarbrooke. Consumer behaviour in tourism (Routledge, 2016) 48-87
11 Ibid

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Bibliography
Stephen W Litvin, Ronald E. Goldsmith, and Bing Pan. "A retrospective view of electronic
word-of-mouth in hospitality and tourism management." ((2018) 30International Journal of
Contemporary Hospitality Management 1 313-325.
Susan Horner and John Swarbrooke. Consumer behaviour in tourism (Routledge, 2016) 48-
87
Tourism Statistics, Overseas Residents Visits to Japan (2018)
<https://www.tourism.jp/en/tourism-database/stats/inbound/>
Export.Gov, Japan-Travel and Tourism (2018) <https://www.export.gov/article?id=Japan-
Travel-Tourism>
Bynum B Boley, Naho Maruyama, and Kyle M. Woosnam. "Measuring empowerment in an
eastern context: Findings from Japan." (2015)Tourism Management 50 112-122.
Clare Jenkinson and Hugh Felton. "15 Attractions." (2018)Tourism and Animal Welfare 135
Garcia-Villaverde, Pedro M., et al. "Determinants of radical innovation in clustered firms of
the hospitality and tourism industry." (2017) 61 International Journal of Hospitality
Management 45-58.
Statista, Japan Tourism Industry (2018) <https://www.statista.com/topics/4875/travel-and-
tourism-industry-in-japan/>