Module 3

• Key Players in the Tourism Industry

  1. Private and Non-Profit Sectors
  2. Public Sector Services
  3. Suppliers
  4. Travel Intermediaries
  5. Tourists
• Transportation Industry - crucial to the success of tourism. Without an efficient - system and road networks, tourists would not be encouraged to come to destinations that have lengthy, tiresome, and costly travel.
• Attractions - basic requirement in having a successful tourist destination. These can be classified as natural or man-made.
• Travel Intermediaries - help bring the tourism product to the customer. These are also known as “channels of distribution”.
• Tourists - the center of tourism industry. Being the main consumer of tourism products, they choose where they want to go, what they want to eat, and what they want to do.
• Accessibility - for a tourism product to be highly successful, infrastructure services (airports, roads, bridges, etc. )and transportation system (direct flights of airplanes, trains, buses, etc.) should be put in place.
• Destination image helps the visitor from expectations of what they will experience.
• Supporting products - add value to the core product and help differentiate its from its competitors.
• Augmented products - are factors that help the consumer consider the product over other products because these include product accessibility, geographical location, operating hours, atmosphere, customer satisfaction, and customer interaction with each other.( interaction with service provider and other customers)
• Atmosphere - the over-all feel of the place. This is much appreciated through senses.
• Growth stage - a period of rapid market acceptance and increasing profits.
• Maturity Stage - a period where sales plateau because the product has achieved acceptance by most of its buyers.
• Marketing Mix Modification - this is when the company attempts to improve sales by changing one or more of the marketing mix elements to attract new customers and prevent consumers from switching brands.
• Exploration - characterized by few adventurous tourists, close interaction with locals, minimal effect on social, cultural, and physical environments, and local facilities are used.
• Consolidation - tourism has become major economic factor. There is heavy advertising and promotions. Facilities begin to deteriorate and growth rates decline.
• Concept Development and Testing - the products that pass through the screening can now be developed further.
• Prototype Creation - when the concept has been developed, when marketing seems to be feasible and the product financially viable, a - of the product is created.
• Commercialization - this is when the product is fully launched to the entire target market either nationally or internationally.
• Profit margin - level of income that is desired by the company.
• Break-even point - the point wherein total costs is equal to total revenue.
• Product-Quality Leadership - some companies want their brand to be associated with high quality.
• Prestige Pricing - is used when the product or service is positioned to be luxurious and elegant.
• Volume Discounts -are rates given to frequent or high volume users to attract them to purchase the products.
• Yield Management - is a form of discriminatory pricing wherein some of the market segments pay higher or lower prices than other tourists for the same tourism products and services in order to ensure optimal yield from the available inventory.
• Prestige Pricing

  Used when the product or service is positioned to be luxurious and elegant. Higher price (compared to prevailing market prices) projects that the product is high-end and prestigious.
• Market Skimming Pricing

  Companies employ this strategy when the market is price insensitive. Consumers become price insensitive when demand is high and supply is low.
• Market Penetration Pricing

  Used when setting a low initial selling price to penetrate the market quickly and to attract many buyers for a large market share.
• Product Bundling Prices


  A strategy used to attract buyers to purchase because of the reduced rate of the bundle compared to the total cost of the item if purchased individually.
• Volume Discounts

  Rates given to frequent or high volume users to attract them to purchase the products.
• Discounts Based on Time of Purchase

  A price reduction is given to buyers who purchase services out of season when demand is lower. This strategy addresses the seasonality aspect of the tourism product.
• Discriminatory Pricing


  The segmentation of the market and pricing differences based on price elasticity characteristics of the segments.
• Psychological Pricing


  Psychological aspects like prestige, reference prices, round figures, and ignoring end figures are used in pricing. This strategy plays on the psychology of the consumer. The consumer defines the perceived value of the product.
• Promotional Pricing


  Offers discounts and short-term incentives especially during the introductory stage of the product or during special activities such as anniversaries or festivals.