Marketing in Travel and Tourism: A TUI Group Analysis Report

This report provides a comprehensive analysis of marketing strategies within the travel and tourism sector, focusing on the TUI Group. It begins with an overview of marketing concepts and principles relevant to the travel industry, emphasizing the importance of adapting to a globalized and competitive market. The report delves into how the marketing environment, including political, economic, social, and technological factors, impacts TUI's business, particularly in the context of its Summer 2020 holiday plans for Mexico and Costa Rica. It also examines the factors influencing customer motivation and demand, such as the global economy, internet and social media, and personal budgets, highlighting their significance in shaping consumer behavior. Furthermore, the report explores the principles and applications of market segmentation within TUI, and the importance of strategic marketing planning, marketing research, and the influence of marketing on society. The report also discusses issues related to the marketing mix elements (product, price, place), the service sector mix, and the concept of the total tourism product. Finally, it addresses the integrated nature of the promotional mix and proposes a promotional campaign for TUI's Summer 2020 deals.

Marketing in Travel and
Tourism

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Concept and various principles of marketing within travel sector...................................3
1.2 Impact of marketing environment on TUI .......................................................................5
1.3 Factors which impact on motivation and demand of customers in travel and tourism sector
................................................................................................................................................6
1.4 Market segmentation's principles and its uses in marketing planning of TUI.................7
TASK 2............................................................................................................................................8
2.1 Importance of strategic marketing planning for TUI.......................................................8
2.2 Relevance of marketing research and market information to managers in TUI...............8
2.3 Influence of marketing on society....................................................................................9
TASK 3............................................................................................................................................9
3.1 Issues in product, price and place elements of marketing mix with reference to TUI ....9
3.2 Importance of service sector mix elements to travel sector...........................................10
3.3 Concept of total tourism product to TUI........................................................................11
TASK 4..........................................................................................................................................11
4.1 Integrated nature and role of the promotional mix.........................................................11
4.2 Plan and justify an integrated promotional campaign for TUI Summer deals 2020......12
CONCLUSION..............................................................................................................................12

INTRODUCTION
Today in fast changing world, it becomes essential for all organisations to implement new
marketing policies in business. It would provide benefits to companies in promoting the business
and avail higher competitive advantage. In travel sector, for applying different marketing
changes, it is necessary for organisations dealing in same business, to analyse the latest trends of
marketplace (Boniface, Cooper and Cooper, 2016). This would help in developing effective
market plan to improve and enhance functions of a company.
This assignment is made to evaluate the concept of marketing in travel business and factors
that affect consumer motivation. For this purpose, TUI Group i.e. Tourism Union International is
taken that deals in travel business and offers a wide variety of holiday packages of different
vacations. This is considered as one of the largest leisure Anglo-German company, which has its
own travel agencies, hotels, airlines, cruise ships and operate business in many countries. In
order to grow product range for one of its project based on Central America Summer 2020
holidays to Mexico and Costa Rica. For this assistance, importance of strategic marketing
planning is discussed in this assignment, with marketing mix strategies. Furthermore, importance
of service mix, promotional mix and marketing mix elements in travel industry are also
described in present assignment.
TASK 1
1.1 Concept and various principles of marketing within travel sector
In today’s globalised world, with development of technology it becomes easy for all
companies to operate business in other nations more appropriately (Agyeiwaah, McKercher and
Suntikul, 2017). As competition among organisations is rising rapidly on both national and
international level, therefore, it forced companies to apply a number of marketing principles for
product development. In this regard, to stay at intense competitive area of marketplace, TUI
Group which is one of the largest travel company of UK, is going to increase its product range.
For this purpose, its product managers and team is working on one of the main project based on
Summer 2020 holidays for destinations of Mexico and Costa Rica. With this assistance, it is

essential for product team and manager for analysing the concept of marketing and its
principles.
Concept of marketing:
Marketing refers to the main management of a company that mainly works to design
effective and unique strategies, for building profitable relationship of business with its targeted
customers (Farmaki, 2015). It also establishes core values of business that underpins strategic
planning as well as decision making, at every aspect of organisation. For product development,
it is essential for TUI Group to determine the latest trends and different requirements of tourists
before initiating the process of marketing, by analysing concept of marketing as- Product concept: This strategy of marketing focuses more on the concept of product
development, which force travel agencies like TUI to offer best quality and innovative
features of products (Jordan and Vogt, 2017). In this regard, respective agency needs to
develop marketing strategy which focuses on continuous improvement in product and
services. Production concept: It refers to a useful philosophy where, production concept idea is
based on consumer buying behavior. Travel companies that focuses more on
improvement of production and distribution efficiency are mostly apply this production
concept. Selling concept: Instead of building long-term customer relationship, selling concept
idea concerns on promotional effort (McGehee, Knollenberg and Komorowski, 2015).
Here, to sell the existing products, managers of TUI can concerns on selling the same on
discounts and attractive rates. Marketing concept: For achievement of organisational goals, this concept concerns on
identifying trends and demand of marketplace. Therefore, it is a customer-centred
approach and assist travel agencies for offering right products to their targeted audience.
 Societal marketing concept: This concept force organisations to build effective
marketing strategy, which must deliver value to targeted customers in such a manner
that improves as well as maintains well-beings of both consumers and society (Mose,
2016).
As TUI currently works on the new project of Summer 2020 holidays for destinations of
Mexico and Costa Rica, therefore, for this purpose, its management team need to apply the

product concept of marketing for product development.
Principles of marketing:
The principles of tourism marketing includes an integral part of marketing plan which is
based on four P’s as Place, Product, Price and Promotion (Ozturk, 2016). Here, place refers to
particular channels and distributors of tourism industry like Inbound tour operators. In this
regard, TUI Group's new project on Mexico and Costa Rica destination holds the attractive
locations for enhancing customer experience during summers. In order to enhance product life
cycle, product strategy of marketing assists respective company to do market research on
regular basis. This would help in understanding market demand and making improvement for
increasing product life-cycle as well. TUI also needs to ensure that right price must be offered
for its new destination holiday plans, to gain sustainability in marketplace (Postma, Cavagnaro
and Spruyt, 2017). Along with this, its product managers and team also needs to develop
effective promotional plan for marketing its services related to holiday packages for Mexico
and Costa Rica.
1.2 Impact of marketing environment on TUI
Marketing environment can be defined as the forces and factors that affect the company
for maintaining its position and assembling a successful long-term relationship with its
customers. It includes political factors, economical fluctuations, social concerns and technology
that affects efficiency of TUI business (Qureshi and et. al., 2017). As this company is going to
make a new plan for holiday destinations of Mexico and Costa Rica, but as both are lies between
US and Central America, therefore, impact of marketing environment on business of TUI can be
analysed by –
Political factors: It includes the involvement of government of both countries viz. Mexico
and Costa Rico in travel and tourism sector. Therefore, changes in factors like taxation policies,
governmental laws related to tourism, rules and regulations affect the budgets and holiday
packages of TUI.
Economic factors: This factor highly affects the travel actions of TUI in terms of its
profitability, growth in business, development due to fluctuations of economy (Raza and et. al.,
2017). In this regard, any recession period of economy where people saves more and spend less

will highly affect pricing strategies of holiday packages of TUI for Mexico, Costa Rico and other
destinations.
Social factors: It specifies the cultural changes, different pattern of marketplace, demand
and lifestyle of tourists which may affect the current operation of TUI related to Summer project
2020 especially for Mexico and Costa Rico, that includes a journey of beautiful destinations of
both countries.
Technological factors: As per current scenario, due to technological advancement in
travel sector, it gives opportunity to organisations for increasing tourism (Vellas, 2016). While
travellers also gain advantage to directly book their tours by getting details of tour operators that
offers holiday packages on amazing rates. In this regard, any negative review of tourists on
websites may affect promotional plans of TUI and forces to apply effective software that
minimise negative reviews. Through mobile applications, respective company can also promote
about its new holiday summer plans to targeted customers directly.
1.3 Factors which impact on motivation and demand of customers in travel and tourism sector
In order to motivate the customers, it is required for TUI to bring efficiencies and
innovation in its services so that the customers can get motivate to purchase the same.
Motivation refers to a factor which changes the mind-set or purchasing power of customers
(Huang and et. al., 2016). But there are certain factors which affect customer motivation as well
as demand in travel and tourism as given beneath:
 Global economy – As travel is generally considered as a luxury and people whose
earning power is less then budget for spending holidays affects minds of them first. In
this regard, recession period of economy effects demand in travel and tourism adversely.
In this regard, TUI marketing concept is shifted to future plans to gain a substantial
growth in this industry by offering its new holiday package of Mexico and Costa Rico
within a budget of targeted customers (Park, Ok and Chae, 2016) .
 Internet and social media – Now a days, social media and internet services has become
a part of everyone's life, where before purchasing any services, people mostly spent most
of their time on the same to get updates of company’s new product and price strategy.
Therefore, reviews and opinion of other travellers on different sites of social media
applications (Facebook, Twitter, Instagram, Company’s websites) about their travelling
experience affect mind-set of people. Here, if they get positive reviews about holiday

packages and travelling experience then through technological advancement, they can
directly contact tour operators to purchase such plans. While negative reviews take them
away from the same and they switch to another operator.
 Personal budget – It is another main aspect that directly affects customer decision to
take tour operator services for visiting a place. To travel and explore the world they used
to compare various deals and offers of different travel agencies and choose the best one
that fits with their personal budget. Such people always awaited to get maximum
discounts for travelling a place.
Thus, it is essential for TUI Group to concern on these factors while making future marketing
plans for new destinations.
1.4 Market segmentation's principles and its uses in marketing planning of TUI
Market segmentation refers to the bifurcating process that helps a company in segmenting
the entire market into targeted area. Further, targeted area then divide into small fragments
where, each group shares a same taste and preferences (Prebensen, Chen and Uysal, 2018).
Therefore, TUI usually segment its targeted area on the basis of demographics, i.e. as per
background and purchasing power of customers. But before, apply market segmentation, it is
essential for TUI to understand the principles of market segmentation and its used in marketing
planning as –
 Accessibility: - In market segmentation, it is the main principle that plays a pivotal role
in market segmentation that states that a company cannot reach targeted customers if
don’t have a popular brand image at marketplace. In context with TUI, it is one of the
most popular travel agency that offers leisure services. Therefore, customers can easily
access its services.
 Identifiable features: - The basic requirement of market segmentation includes what
incredible features a company offers to its customers that make its brand unique. There
has been always a group of consumers that shares common taste and preferences. So, it
is highly essential to TUI to identify those common needs to prevent its new project for
Summer 2020 holidays in Mexico and Costa Rica from loss and fails in terms of long
run.
 Affordability: Another important principle of market segmentation that must apply on
marketing planning is the potential and willingness of customer to pay for services. In

travelling section, high priced or leisure services are mainly targeted to people belong to
high income group. Therefore, TUI can divide its market on the basis of demographic
segmentation and targeted area as per income level of customers and develop the pricing
strategies accordingly to gain high competitive advantage for business.
TASK 2
2.1 Importance of strategic marketing planning for TUI
A strategic marketing refers to a plan that mainly used to optimise the resources more
appropriately and reduce the wastages of same. This plan also helps in identifying the direction
to reach its completion of goals (Huang and et. al., 2016). Therefore, strategic planning is taken
as marketing tool that help in eliminating all such activities like wastage of time and money
which are unproductive for a business. Along with this, strategic planning would also help TUI
to develop its vision and mission of new project to make appropriate portfolio as well. Its
marketing planning strategies are mostly concerns on providing care, increasing accessibility of
business, offering best holiday packages and develop efficiencies in operational functions by
streamlining organisational structure.

2.2 Relevance of marketing research and market information to managers in TUI
The process of market research is required to get suitable and relevant information about
circumstances of marketplace and competitors’ strategies to avail strong position within same
industry (Raza and et. al., 2017). With the help of this market research, TUI Group can evaluate
information related to latest trends and identify the purchasing power of targeted customers. This
would aid in capture the whole market and make appropriate changes in strategies for increasing
willingness among customers about purchasing its new holiday packages to visit the beautiful
destinations of Mexico and Costa Rica. In order to get customer loyalty, it is essential for
marketing team of TUI to deliver best services to customers (Qureshi and et. al., 2017). For this
assistance, market research helps in identifying the economic situation of Mexico and Costa Rica
to make better plans related to pricing strategies of holiday packages of these destinations, for
attracting customers more easily.
2.3 Influence of marketing on society
As the main purpose behind implementation of various marketing plan and approaches for a
company is to influence mind of people towards its business (Postma, Cavagnaro and Spruyt,
2017). Therefore, marketing activities cannot execute successfully without the involvement of
society. There are multiple concepts of marketing includes such as advertising, sales promotion,
direct marketing and public relations. These concepts bridge the gap between products and
services of a company to its targeted customers. Here, promotion and advertising taken as most
useful concept of marketing for influencing the demand in travel industries. As society is made
up of different sustainable marketing efforts of travel industries, therefore, it is essential for TUI
to take ethical and fair approaches for running its business that reflect its positive brand image in
society (Ozturk, 2016). This would help in enhancing its customer base and earning high
sustainability as well.
TASK 3
3.1 Issues in product, price and place elements of marketing mix with reference to TUI
Marketing mix is considered as an important aspect of promoting a business for a
company (Mose, 2016). In this regard, before applying any marketing plan on holiday packages
of new destination place of Mexico and Costa Rico, it is important to analyse the issues related
to different marketing mix elements as given below:-

Product: It is the most important aspect of marketing elements on which entire progress
and profitability of a company based. Therefore, for offering holiday packages of these two
destinations, it is essential for TUI Group to determine which features will help in catching the
attention of targeted people (McGehee, Knollenberg and Komorowski, 2015). Here, increasing
demand of innovative experience of travelling may create issues in offering product of TUI
Group at particular marketplace.
Price: It is another main important aspect of where offering multiple pricing strategies is
highly important to gain attention of customers to cover the cost effectively and attract more
customers towards business (Jordan and Vogt, 2017). As good pricing strategy helps in
determining the point at which a company can maximise its profit, therefore, TUI Group also
focuses on adopting the same. For this purpose, it concerns on a range of strategies like pricing
at a premium, pricing for market penetration, economy pricing, price skimming, bundle pricing
and more. Here, in context with TUI, it adopts pricing at a premium strategy would be main
influencing factor that arise issues for this company related to offer holiday plans for
destinations of Mexico and Costa Rico. Therefore, building effective pricing strategy is
considered as the only better plan for addressing this issue
Place: This element of marketing mix reflects what a company is going to offer its
customers. Therefore, TUI needs to develop effective plans for travellers to visit various
beautiful destinations on a single holiday package and right service at right time (Farmaki,
2015). Along with this, the destinations which are going to offer must be accessible to the
customers. For this purpose, a detailed information about visited place of Mexico and Costa
Rico in new project based on Summer 2020, should be given either on company’s websites or
social sites by TUI Group. It includes Corcovado National Park & Drake Bay, Arenal Volcano
Park & La Fortuna, Monteverde Cloud Forest Reserve etc. destinations of Costa Rica. While
Mexican destinations include Acapulco, Cancun, Guadalajara and more. Detailing of these
destinations on social sites or company's website is enough for TUI to attract minds of visitors.
3.2 Importance of service sector mix elements to travel sector
Service sector mix elements includes another three main marketing mix strategies after
4P's (price, product, place and promotion) – People, Process and Physical evidence. Hereby, to

offer holiday packages of Summer 2020 of Mexico and Costa Rico destinations, it is essential for
managers to concern on internal elements for providing supreme delivery of services through -
People – It refers to main element of service mix that force TUI Group to provide
employment to high talented workforce, as they will be experienced in providing best services to
customers through effective interaction with them (Park, Ok and Chae, 2016). In addition to
this, respective tour operator also focus on developing skills and qualities of associated staff such
as knowledge of various languages, effective communication abilities to influence tourists
towards services of company and more. It focuses more on suitable interpersonal skills, service
knowledge and positive attitude to give expected services to potential customers.
Process – Here, TUI Group focuses on avoiding delays of customer services therefore,
keep an eye on time tables, as well as make sure that every accommodations (food, beverages,
transportation and more) should be served as per schedule. Along with this, complaints should be
dealt properly for maintaining customer confidence.
Physical evidence – Here, for offering the holiday packages of destinations of Mexico
and Costa Rico, TUI Group use online website technique, which is user friendly. It allows
targeted audience to get entire information about services, destinations and accommodations
through online technique.
Therefore, incorporating the service sector mix TUI Group can increase its internal
capabilities of organisation and provide opportunity to gain support of employees for delivering
best services to customers.
3.3 Concept of total tourism product to TUI
Total tourism product in travel industry can be defined as the combination of
psychological and physical satisfaction that focuses more on facilitating services to customers,
that meets which meets their desires. Therefore, toursim product can also consider as total
experience of visitors. In travel sector, tourist do not purchase the products, they just receive
travelling experience or totality of benefits by taking services of tour operators (Prebensen, Chen
and Uysal, 2018). Therefore, for purchasing any service, tourists mainly concern on package of
benefits, accommodations, planned dates of destinations and more. It also includes better
facilities like food and beverages, transportation etc. attractive destinations, transport facilities,
adventures tours and more. Along with this, tourism products also include the status as well as
luxury services in compliance to services.

TASK 4
4.1 Integrated nature and role of the promotional mix
In travel industries, integrated marketing communication includes concept of using
strategic communication plan to promote a business. Therefore, this plan designed in such a
manner that a company can easily reaches towards its every segment of market (Agyeiwaah,
McKercher and Suntikul, 2017). The strategy of TUI for promoting Summer Deals 2020 for
Mexico and Costa Rica to be comprised of one single unified message, to attain its goal i.e. to
build brand image. Under this procedure, integrated marketing communication process in TUI
will integrate overall marketing communication aspects to increase the revenue as well as
achievement of maximum cost effectiveness.
Elements of Promotional Mix in Travel and Tourism:
 Advertising: This method is used to promote a business with aim to increase sales. For
this purpose, TUI can use print media like newspaper, social media and electronic media
like direct mail to customers or mobile applications for upgrading knowledge of
customers towards its new holiday packages.
 Personal Selling: It is another promotional method which includes face to face selling
procedure for changing purchasing behaviour of customers.
 Sales Promotion: To attract customers, TUI can offer lucrative services to customers
like discount for couples, family and more.
Therefore, through promotional mix strategy, TUI can integrate best technique for
developing communication with potential customers and bring awareness among them about its
new offer – Summer deals 2020 holidays. But before running any promotional campaign through
social sites or other distribution channels, it is essential to immediately address the issues which
might come during the same. Here, issues are mainly associated with target market for whom
TUI is going to offer new services. It includes personal budget of customers, global economy
and expectation of audience. In this regard, to address the issue TUI needs to offer a unique
selling point which includes a plan for tightly positioned the business at competitive
marketplace.