Service Marketing in UK Economy: B2B, B2C, and TUI Marketing Analysis

This report provides a comprehensive analysis of service marketing within the UK economy, focusing on the travel and tourism sector. It begins by examining the size and structure of the travel and tourism industry, highlighting its significant contribution to the UK's GDP and employment. The report then delves into the core concepts of service marketing, differentiating it from product marketing and outlining key factors such as intangibility, heterogeneity, inseparability, and the importance of pricing and direct channels. The report identifies TUI as an organization operating in both B2B and B2C markets, exploring the differences in their marketing approaches. A critical evaluation of TUI's marketing strategies and marketing mix in both B2B and B2C operations is provided, including the use of geographic targeting and marketing mix elements. Furthermore, the report applies the GAPS model to analyze potential gaps in service quality and discusses the deployment of CRM for customer engagement and retention. Finally, the report concludes with an assessment of TUI's success and offers recommendations for improving its marketing operations.

Business-to-Business and
Services Marketing

Table of Contents
INTRODUCTION...........................................................................................................................1
1. Size and structure of Travel and Tourism within UK Economy and its contribution........1
2. Service Marketing..............................................................................................................2
4.Set out a critical evaluation of how it structures and operates its marketing strategy and
marketing mix in both its b2b and b2c operations ................................................................4
5. apply the GAPS model.......................................................................................................5
6.deployment of CRM to achieve customer engagement and retention.................................6
7.conclusion on how successful the organisation is and set out some justified
recommendations to improve its marketing operation...........................................................7
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................9

INTRODUCTION
Service Marketing plays an effective role in the market and is considered as very
different as compared to marketing which is done for the product. The services are the intangible
offerings which are provided by the companies to customers in order to satisfy their
requirements. Marketing of services includes the concepts which are based on product, price,
place, promotion , processes , physical evidences and people. For maintaining the quality of the
services a company must be completely concerned with the aspects of consistency and its
homogeneity while providing it to consumers. Therefore the following reports includes the
concept if service marketing and size and structure of the service sector of the UK economy.
Also B2B and B2C has been described along with their importance in the market place. The
importance of GAP model has been provided along with its relevancy in the Marriott
International Hotel group (Ghuman and Mann, 2017). Along with that the factors which are
related to GAP model has been referenced and has determined the problems and gaps which
mostly occurs in the Marriott International and has created various problems which has to be
effectively solved.
1. Size and structure of Travel and Tourism within UK Economy and its contribution
Travel and tourism is the fastest growing industry of the world and it also strengthens the
economy of country and according to survey it is found that UK is eight biggest tourist
destinations that attract most of the visitors that is why size of travel and tourism sector is so
wide in UK economy. There is direct contribution of travel and tourism to the GDP. In 2016, the
GDP was GBP66.3bn (USD89.8 bn) which is around 3.4 per cent of total GDP in 2016 because
the size of this industry is wide so contribution towards economy is also higher. The primary
economic activity generated by industry such as hotels, travel agent, airlines are the example
who directly contributed and supported by tourism. And it is expected to grow by 2.2 percent by
2027 (Blanke and Chiesa, 2013).The contribution in investment, the supply of chain and induced
income impact was GBP 209.0bn in 2016 and it may be grow by 2.2 percent in next years.
United Kingdoms is in number 6th who contribute direct to the GDP.
Travel and tourism also help in generating direct employment around 1,589,500 jobs are
provided to the people in 2016 that may be grow by 2 percent in 2017 and 4.7 percent of total
employment is depended on tourism sector (Tussyadiah and Sigala, 2018). This employment
includes hotels, agents, airlines and other passengers' transportation service excluding computer
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services. By 2027, it is forecasts that travel and tourism sector 1,808,000 jobs directly that is
increase in 11 percent in recent ten years which is the biggest data in all over the world and
according to data available United Kingdom ranked 11th with 4081.9000 jobs in 2016. According
to the data available there is continuous growth in the economy of UK and in 2027 it is expected
that it will be number 1 tourist destination with the highest economy from all over the world.
The visitor exports are a key component of the direct contribution of travel and tourism.
From 2007 to 2017 there is sudden increment in visitors exports and investment but now the
country expected to attract 36,888,000 international tourist arrivals. And in 2027, international
tourist arrivals are forecast to total 54,389,000 which is increase of 3.8 percent per annum. TUI is
travel agency which is also helpful in the contribution of United Kingdom's economy. It is
expected to have attracted capital investment of GBP15.6bn in 2016 and expected rise by 1
percent more in two to three years and rise by 2.7 percent per annum over next ten years. Travel
and tourism's share of total national investment will fall from 4.9 percent in 2017 to 4.7 percent
in 2027 (Mahrous and Hassan, 2017). The overall GDP of United Kingdom is affected by this
service sector and from above data it is also concluded that economy of UK is increases every
year and percentage of whole economy will be increased in next ten years.
2. Service Marketing
Service marketing is a broad category of marketing strategies which is based on building
relationship and value with the customers in the target market. It is different from the marketing
goods as they are unique characteristics of services which includes namely, intangibility,
heterogeneity, and inseparability. It focuses mainly on selling organization's goods and services
to their customers in effective manner. Any method which can be used to communicate a
service's appeal and benefits to customers is considered as a valid approach, which includes
informational content, promotional offers, advertisements, and many more (Huotari, K. and
Hamari, J. 2017).
There are various factors which help the organization's service marketing in the service
sector. Organization which provides services to their customers uses this technique to increase
their services. Also, organizations that provide services to other companies will apply these
marketing techniques in their system which is an important aspect in Business to business
marketing.
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Functions of Service Marketing : There are various factors which helps the organization to
upgrade their marketing strategies, such as,
 Intangible : These are the services which does not have a physical presence in the
market. These services are those which can not seen or touched by the customers. For
example,
 Variable : These are the services of the organization which involves different people.
This conclude that any two services can not be completely identical or same, they are
variable. For example, if there is the same inquiry in the organization it will be answered
completely opposite to what the two different person has said (Rust, R.T. and Huang,
M.H. eds. 2014).
 Inseparable : In this method, personal services of the customers can not be separated
from it. Services are those which has to be created and utilized at the same time. For
example, if a client searches online a particular service say doctor than immediately it
will create and offers discounts on various doctor's services in that area.
 Changing Demand : Change in the market is continuously existing in the market. So the
demand for service marketing has also been changed with this. For example, there a
change in tourism sectors every year because it a seasonal business which is there for
some time period only.
 Pricing of services : It is an important aspect in service marketing. As price is directly
interrelated to marketing process in any organization. Pricing of any service is
determined on the basis of its demand in the market and according to its competitors.
 Perishable : In this service, a product or service which is being already existing in the
market can not be repeated exactly with the same functionality. There should be some
visible change in it (Wirtz, J. and Lovelock, C. 2016).
 Direct Channel : In this process the service is directly provided to their customer. The
customer comes to the service provider and get its service. For example, if a person needs
to withdraw some money he will directly go to that bank and will withdraw money.
3.identify an organisation that operates within both b2b and b2c market
B2B market is known as that kind of market where all the transactions are done between
various businesses. It is the acronym form of business-to-business. They mainly concentrates on
commercial transactions, where one business is regarded as source for providing the resources to
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other one. It is done mainly as one party always requires services from other fro its own
operations that is to be necessary provided in order to develop a formal relation in a market. In
this case TUI provides business transactions to other collaborate hotels which can be in the form
of potential customers by providing them various holiday packages for many tourist destination
in which hospitality services are also added along with transportations and etc. which provides
an opportunity between these business in order to lea a transaction on the term of business.
On the other side B2C is the4 acronym form of business to customer marketing operation
in which the transaction is done between them in terms of goods and services. There is a direct
relation between the organisation and consumers who are willing to consume or avail the
services. The transactions are directly occurred between both parties. Therefore in TUI it mainly
focuses on providing services to the customer by giving them various packages according to their
preferences along with the personal suggestions for choosing any particular holiday package
which is completely based on their affordability.
Both these market operations focusses on the effective transaction of the resources. Both
these processes has many differences like in B2B the price of particular service may very for
various customers but in B2C it may be similar (Gummesson, 2014). In the business-to-business
transactions the customers buys various goods and services for the purpose of conducting
businesses whereas in business to customers, consumers prefers offering for satisfying their
needs and requirements. These operations plays a crucial role in order for the organisation as it
lead to provide them a huge base for customers and generate a good revenue which leads to
provide an effective increase their shares in service sector thus providing them an opportunity to
grow and expand.
4.Set out a critical evaluation of how it structures and operates its marketing strategy and
marketing mix in both its b2b and b2c operations
As being a travel agency TUI has to make various strategies for marketing in various
operations. For dealing with customers there has to be strategies which should be associated with
their choices and preferences and would lead to provide satisfaction for what they expects while
availing their serveries. As the consumers are very price sensitive who are very income sensitive
therefore , they have to deal with them accordingly, resulting in providing range in the prices
which can be afforded by several customer according to their affordability. This strategy is much
liked by the customers of tourism which in turn leads to great promotion of their services in the
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market. They basically targets people of different incomes and economic. Also this tourism
agency applies various marketing mix such as they mostly concentrates on the promotion aspect
in order to attract the customers where they are provided an effective processing of services by
delivering them the services in a coordinative manner. They are provided proper guidance and
suggestion for choosing the most suitable package of services according to their criteria and can
be afforded by them (Iankova and et.al., 2018). This provide a great help to them and leads to
make their company as brand name.
In Business-to-Business operations TUI uses the geographic target testing where they
collaborates with hotels which are situate across the world. In order to expand their business for
achieving success which should be handled effectively as collaboration are taken between
various business parties and the transaction which are done in completely commercial between
TUI and hotels as they provide customers in order to get hospitality services from the hotels so
that both can get an opportunity for getting benefit in their purposes. The marketing mix which
is used in this operation is product and place as they mostly focuses on the kind of service
exchange they are providing to each other which completely depends on the criteria of
geographic place as the travel agencies are mostly connected with the various hotels which are
situated at several places.
5. apply the GAPS model
GAP model is very effective model specially in service sector which has an immense role
for defining the quality of services. The quality aspect matters a lot for every customer as they
are much concerned about this factor and are also price sensitive because they want to avail more
services by paying less for the holiday packages which are provided by travel agency. Therefore
there is a lot of gaps created because of variation in the perception of the service provider and the
customer which is needed to be eliminated in order to maintain the effectiveness and efficiency
of the services which would lead to increase the customer base in the particular industry. The gap
model identifies these factors which lead to decrease the value of a service in the mind of the
consumers. The major aim of this model is the identification of the gap among the expectation of
customer and the services which are actually provided at several stage and secondly closing these
aspects which leads to improvisation of the customer services.
First includes the gap between the expectation of the customer and the perception as there
are some requirements from the particular services which would be availed but the customer but
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after experiencing the service it led to creates a particular perception regarding it which is very
important to be removed.
Second includes the gap between the expectation of a consumer and the perception of the
management. Here there is a poor interconnection among the service provider and he consumer
which lead to degrade the quality of the services which is provide to the customer (Mencarelli
and Riviere, 2015).
Third is the policy gap which is the gap between the perception of management and
service quality specification. Sometimes customers are provided different services as compare to
what it have been specified to them.
It is consider as the major weakness of the organisation as it provides a great variation
between the specification of quality of the services and what is the quality level of which is
being delivered.'
Also one of the gap is based of the communication aspect which determines the gap
between the delivery of the services and the external communication that includes the promise
which are made by media and through word of mouth.
6.deployment of CRM to achieve customer engagement and retention
Customer Relationship Management provides a great benefit to the company as it lead to
provide an opportunity to re-tent and engaged the customers to avail their services whenever they
urge to travel. There fore create a good will in them mindset of the customer it is very important
hold the customer so that their services can be provided in market which would lead to expand
their business and would produce a strong and effective impact on the competitors as well as
potential customers. There are many strategies which are applied by TUI in order to make their
customers engaged while providing many offers that would be liked by them and holding them
in order to preserve the base of the customer for generating a good revenue.
The major concept which they have to make sure that the interconnection of them and
their customers must be strong in order to develop a relationship which is based on a trust and a
strong preference. They must be provided personalised interaction in order to remain in touch
with them and stay connected (Swani and Iyer, 2015). Their expectations and suggestions must
be taken in order to make them feel as the part of the company only. They should be given
various opportunities to customise their services and shall be provided various offers such as
making up of loyalty cards that would lead to avail certain special services which leas to engaged
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the customer in order to achieve those grades for grabbing the opportunities. Also they should be
targeted in such a way that their requirements for the services which are provided by TUI shall
make sure that it fulfils every criteria which would provide them high satisfaction and a
preference over the competitors who are present in the market providing the similar services.
They are also provided certain incentives if they refer them to any other customer which is
known as the referral award.
7.conclusion on how successful the organisation is and set out some justified recommendations
to improve its marketing operation
The TUI travel agency is a successful British travel group which provides services to the
consumer related to travel and tourism. As it deals with the services such as passenger transport
and accommodation also. It has been the first choice of these travellers in UK who provides
every kind of travel services. Also, they are generating a good revenue and has provided them
opportunity to expand across the world which has not only made their status strong but has lead
them to establish themselves in the tourism market. There are many subsidiaries of this agency
and travellers from any country can avail these services without any problem as they have a
strong networking distribution (GAP model,2018).
Some of the suggestion which could be provided to the organisation is that it can make
their marketing more effective by adopting digital marketing in which they can opt for various
social media techniques which would provide them a larger access to travellers across the world
and they also might get aware of them and their related services. It would lead to decrease their
promotion cost as it would not require more salesman rather than just a single skilled person for
particular process.
CONCLUSION
It has been concluded that service marketing is the indispensable part of an economy
where as it has various criteria which provides the standard for maintaining the quality aspect if
the services. Also the importance of Customer relationship management has been acknowledged
that determines how essential it is for a service sector as it is concerned with providing several
kind of services which are important for developing their good will and market share in the
economy which lead to determine their success in every aspect. Also the contribution of the
service sector in the UK economy has been provided which lead to a conclusion that it has more
than half of the share in the total percentage of the economy as one has to make various
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strategies and market mix for the services which they are giving in the form of B2B and B2C
operations of a market.
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REFERENCES
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Management Science.8(3).pp.321-335.
Gummesson, E., 2014. The theory/practice gap in B2B marketing: reflections and search for
solutions. Journal of Business & Industrial Marketing.29(7/8). pp.619-625.
Huotari, K. and Hamari, J., 2017. A definition for gamification: anchoring gamification in the
service marketing literature. Electronic Markets, 27(1), pp.21-31.
Iankova, S. and et.al., 2018. A comparison of social media marketing between B2B, B2C and
mixed business models. Industrial Marketing Management.
Mahrous, A. A. and Hassan, S. S., 2017. Achieving superior customer experience: An
investigation of multichannel choices in the travel and tourism industry of an emerging
market. Journal of Travel Research. 56(8). pp.1049-1064.
Mencarelli, R. and Riviere, A., 2015. Perceived value in B2B and B2C: A comparative approach
and cross-fertilization. Marketing Theory.15(2).pp.201-220.
Rust, R.T. and Huang, M.H. eds., 2014. Handbook of service marketing research. Edward Elgar
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Swani, K. and Iyer, E.S., 2015. Financial Services Advertising: Comparing Business-To-
Business and Business-To-Consumer Contexts. In Ideas in Marketing: Finding the New
and Polishing the Old (pp. 692-692). Springer, Cham.
Swani, K., Brown, B. P. and Milne, G. R., 2014. Should tweets differ for B2B and B2C? An
analysis of Fortune 500 companies' Twitter communications. Industrial Marketing
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Tussyadiah, I. P. and Sigala, M., 2018. Shareable tourism: tourism marketing in the sharing
economy.
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Wirtz, J. and Lovelock, C., 2016. Services marketing: people, technology, strategy.
Online
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