Tourism Marketing

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Different Types of Product

Back 1

the core product

the tangible product, and

the extended product

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Delivers the fundamental functional benefits that the customer is seeking.It is the customer, not the company, that defines this

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CORE PRODUCT

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It is composed of the physical elements that are necessary for the core product (benefits) to be delivered

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TANGIBLE PRODUCT

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Tangible Product includes:

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1. product features (the size and range of facilities),2. design (external and internal),3. quality and service standards.

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includes intangible elements of the product that can add value, differentiate the offer, and provide customers with additional benefits

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EXTENDED PRODUCT

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Extended Product Elements

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1. People

2. Accessibility

3. After Sales Service

4. Ancillary or special facilities

5. Atmospherics

6. Brand Image and Corporate Ethics

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offer-staff training, courtesy and contact with customers

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People Element

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this includes location characteristics and opening times

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Accessibility

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customer billing procedures and complaint handling

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After sales service

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for example, business centers and leisure clubs for hotel residents. Atmospheric and overall aura

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Ancillary or special facilities

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the important sensory element of the hospitality experience

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Atmospherics

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it is the ____________ that delivers what is distinctively different about the customer experience - and this is where competitors in the same product class really compete.

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extended product

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One of the most important product decisions facing multiple-unit organizations is how much of the product should be standardized and how much should be customized.

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Service Delivery Concepts

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• The same service delivery process• The same staff recruitment, training and service standards• The same layout, seating and internal décor• The same external frontage, signage and brand logo.• Customers receive a consistent, reliable product• Service processes can be blueprinted

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Standardized Products

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is a flowchart that sets out the various tasks that have to be performed for a service to be delivered to a customer

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Blueprint

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adapting or customizing the product according to the needs of niche market segments, and even individual customers.

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CUSTOMIZED PRODUCTS

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The PRODUCT LIFE CYCLE

The PRODUCT LIFE CYCLE

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IntroductionGrowthMaturityDecline

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• During this period the new product concept is conceived, researched, assessed and, in some cases, test-marketed prior to introduction in the marketplace

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PRODUCT DEVELOPMENT

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Most new product concepts fail at this stage and are never actually launched

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Products Development

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This is the period when the new product becomes more widely accepted by consumers, and sales grow as the concept becomes better established

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GROWTH

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At this stage, the product has reached its potential and growth slows.

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MATURITY

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Eventually the product no longer satisfies the needs and wants of its customers, as alternative products/ competitors provide better benefits to consumers

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DECLINE

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WAYS TO INNOVATE

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1. Acquisition

2. Development

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Once a successful entrepreneur has proved the viability of the new product concept, larger hospitality organizations can either imitate the concept or buy out the entrepreneur's company.

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Acquisition

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Larger organizations set up a new product in-house development team to generate and evaluate new product concepts formally.

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Development

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Most so-called new products are actually _______ , cost reductions or product line extensions, as opposed to original product concepts.

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product modifications

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The introduction stage for new hospitality products includes new-build openings, new brand launches, and re- launches of tired products includes new-build openings, new brand launches, and re- launches of tired products

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NEW PRODUCT LAUNCH STRATEGIES

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• In the growth stage, sales grow, but despite this healthy trend there are pitfalls associated with growth.

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GROWTH PRODUCT STRATEGIES

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business needs to generate:

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Satisfied customers

Positive word-of-mouth

Repeat sales

Relationship marketing

Continuous feedback

Setting prices

Targeting new market segments

Continued investment in marketing communications

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Growth is limited, and is largely dependent upon gaining market share from competitors

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MATURE PRODUCT

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MATURE PRODUCT STRATEGIES

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Continued investment in product quality

Product modifications

Refurbishment of the premises to re-launch the product

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DECLINING PRODUCT STRATEGIES

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Aim to cut costs in every facet of the business

Reduce staffing levels

Only invest in essential repairs

Reduce overall product quality

Take a longer time to pay suppliers.

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where the new owners can reformulate the product offer and invest in the re- launch of the business

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Dispose of the business

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the product by closing the existing business, investing in a new product concept, and starting the PLC again

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Rejuvenate

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This is the launch period, when the new hospitality product is introduced to the market – for example, the opening of a new restaurant.

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INTRODUCTION