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Copyright © 2009 by Nelson Education Limited.
Chapter
THE TOURISM AND
HOSPITALITY PRODUCT
5
5-1
Prepared by
Simon Hudson, Haskayne School of BusinessSimon Hudson, Haskayne School of Business
University of CalgaryUniversity of Calgary
andand
Marion Joppe, University of GuelphMarion Joppe, University of Guelph
Copyright © 2009 by Nelson Education Limited.
Chapter
Topics
• Components of the tourism and hospitality product
• Various levels of products or services
• Tools used in product planning
• Packaging and branding
• New product development in the tourism and hospitality sector
5The Tourism and Hospitality Product
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Copyright © 2009 by Nelson Education Limited.
Chapter
Tourism and hospitalityTourism and hospitalityproductsproducts• selected components or elements of
the hotel, restaurant, entertainment, and resort industries bundled together to satisfy needs and wants
The Tourism and Hospitality Product 5
5-3
Copyright © 2009 by Nelson Education Limited.
Chapter
Three Levels of Product: Core
• Core productCore product
– the basic need function served by the generic product.
– Examples• airline or train = transportation• hotel = shelter and rest
5The Tourism and Hospitality Product
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Copyright © 2009 by Nelson Education Limited.
Chapter
Three Levels of Product: Tangible
• Tangible productTangible product
– specific features and benefits residing in the product itself
– Examples:• styling, quality, brand name, design,
etc.
5The Tourism and Hospitality Product
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Chapter
Three Levels of Product: Augmented
• Augmented productAugmented product
– the add-ons that are extrinsic to the product itself but which may influence the decision to purchase
– features may include credit terms, after-sales guarantees, car parking etc
5The Tourism and Hospitality Product
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Chapter
Three Levels of Product: Theme Park
5
5-7
The Tourism and Hospitality Product
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Chapter
Physical Evidence and the Servicescape
• ServicescapeServicescape– the environment in which the service is
delivered and in which the firm and customer interact, and any tangible components that facilitate performance or communication of the service
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Chapter
Elements of Physical Evidence
5The Tourism and Hospitality Product
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5.1
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Chapter
Response to Servicescapes
• Employees and customers in service firms respond to dimensions of their physical surrounding in three ways:– cognitively– emotionally – physiologically
• Those responses influence their behaviours in the environment
5The Tourism and Hospitality Product
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Chapter
Product Planning
• Product mixProduct mix – portfolio of products that an organization
offers to one market or several– five basic market/product options exist
5The Tourism and Hospitality Product
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Chapter
Five Product Options
1) Several markets/multi-product mixes for
each
Example:– mass tour operators that offer a wide range of multi-
destination packages to a variety of market segments
2) Several markets/single product for each
Example:– airlines with a product for business and economy
class travellers continued...
5The Tourism and Hospitality Product
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Chapter
Five Product Options 3) Several markets/single product for all
Example: - national tourist organization promoting a country
4) Single market/multi-product mix
Example:
- specialist tour operator with a range of cultural tours aimed at a wealthy, educated market
5) Single market/single product
Example:
- a heliskiing operator targeting the very rich
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Chapter
Feature and Benefits Analysis
5The Tourism and Hospitality Product
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Chapter
Product Life Cycle (PLC)
• Product life cycle analysisProduct life cycle analysis– a way to identify the life-cycle stage of a
product or service, review its past and current position, and predict its future
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Chapter
Product Life Cycle
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Chapter
Positioning
• The objective is to create a distinctive place in the minds of potential customers
• Four key positioning strategies
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Chapter
Four Key Positioning Strategies
• Relative to target marketRelative to target market • business travellers, families with children under
ten, etc.
• By price and qualityBy price and quality• a premium product such as a room at the Four
Seasons Hotel
• Relative to a product classRelative to a product class• winter sports tourism category
• Relative to competitorsRelative to competitors• Hertz Rental Car campaign “We try harder”
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Chapter
Branding
• A brand offers the consumer relevant added value, a superior proposition that is distinctive from competitors and imparts meaning above and beyond the functional aspects
• Snapshot: Chefs as Brands: The Case of Jamie Oliver
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Chapter
Advantages of Branding
• helps reduce medium and long-term vulnerability to the unforeseen external events
• reduces risk for the consumer at the point of purchase
• facilitates accurate marketing segmentation by attracting some and repelling other consumer segments
• provides the focus for the integration of stakeholder effort
• strategic weapon for long-range planning in tourism
5The Tourism and Hospitality Product
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Chapter
Brandicide
• It has been suggested that companies can commit ‘brandicide’ by stretching a well-known brand too far
• Think of a brand that has done this.– What was it that killed it off? – Take a tourism brand you are familiar with
and keep stretching it. • How far can you go?
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Chapter
Packaging • PackagingPackaging
– the process of combining two or more related and complementary offerings into a single-price offering
– customer benefits include:• ability to budget for trips
• increased convenience
• greater economy
• opportunity to experience previously unfamiliar activities and attractions
• opportunity to design components of a package for specialized interests.
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Copyright © 2009 by Nelson Education Limited.
Chapter
Packaging and Tourism
• For tourism operations, packages are attractive for the following reasons:– improve profitability – smooth business patterns– allow joint marketing opportunities– effective tool to tailor tourism products for
specific target markets
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Chapter
Product Options in New and Existing Markets
5The Tourism and Hospitality Product
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Copyright © 2009 by Nelson Education Limited.
Chapter
New Service Development (NSD) Model
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5.5
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