Use of Available Tourism Data for Marketing Research & Policy

1. Use of Available Tourism Data for Marketing Research & Policy Tyrone Clarke

2. Definition of Marketing • Marketing consists of the strategies and tactics used to identify, create and maintain satisfying relationships with customers that result in value for both the customer and the marketer. • A social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others (Kotler, 1988,p.3) • The management process responsible for identifying, anticipating and satisfying customers’ requirements profitably (CIM, 1984)

3. The need for meaningful Research • Before committing to the complexities and costs inherent in exporting our tourism services, it is absolutely essential that we undertake some degree of research to better understand the foreign markets that we will be competing in and the consumers to whom we will be selling. • It is important that this research is meaningful; simply compiling statistics and other facts about a market without any purpose, is of limited value. • Any information that we collect needs to be compared, interpreted and conclusions drawn. • Our marketing research activities should be planned and practical exercises leading to specific decisions that drive our marketing strategies. • There is a plethora of data available

4. Market research versus marketing research • Market research is about understanding the broader marketplace in which we intend to compete. • Marketing research, on the other hand, is about understanding what 'package' of marketing elements (i.e. the product, price, promotion and distribution factors) the country will need to put together in order to meet customer needs and to succeed in the marketplace. • Market research is the more encompassing/broader concept of understanding the market environment in which you will be competing, while marketing research is the more specific/focused view of consumer needs and behaviour.

5. Gaining an Information Advantage • In its role as the foundation of marketing, marketing research is arguably marketing’s most important task.  Today marketers not only view research as a key ingredient in making marketing decisions they also consider information to be a critical factor in gaining advantage over competitors.  Because organizations recognize the power information has in helping create and maintain products that offer value, there is an insatiable appetite to gain even more insight into customers and markets.  • Marketers in nearly all industries are expected to direct more resources to gathering and analyzing information especially in highly competitive markets. • In conducting our research we also test concepts against our competitors in order to gain further insights as to what sets us apart and play to those strengths 

6. Cost Implications • While research is key to marketing decision making, it does not always need to be elaborate to be effective.  Sometimes small efforts, such as doing a quick search on the Internet, will provide the needed information.  • However, for most marketers there are times when more elaborate research work is needed and understanding the right way to conduct research, whether performing the work themselves or hiring someone else to handle it, can increase the effectiveness of these projects.

7. Marketing Decision Types of Research • Target Markets- sales, market size; demand for product, customer characteristics, purchase behavior, customer satisfaction, website traffic • Product- product development; package protection, packaging awareness; brand name selection; brand recognition, brand preference, product positioning • Distribution distributor interest; • Promotion advertising recall; advertising copy testing, sales promotion response rates, sales force compensation, traffic studies (outdoor advertising), public relations media placement • Pricing price elasticity analysis, optimal price setting, discount options • External Factors competitive analysis, legal environment; social and cultural trends • Other company image, test marketing

8. E/D Card • The E/D card is a rich source of data for tourism purposes. Serving both the operational and policy aspects of the tourism industry. • The Caribbean is in an advantageous position compared to larger countries who utilize passenger surveys to estimate tourist counts versus the Caribbean where our data is virtually census data.

9. E/D Card • Every permutation of data from the E/D card is useful. • Apart from the tourists count, this data can be used for marketing purposes

10. E/D Card • Today regional governments heavily subsidize airline carriers into the region. • Therefore it is imperative that governments understand the implications of their investments • Data from the E/D cards can aid in determining this kind of investment • Airline load factors • Occupancies for hotels

11. E/D Card • Following trends from the E/D cards can also guide in the development of supply in terms of room stock. • i.e if there is a heavy leaning towards a particular type of product then countries can invest in this type of product

12. Survey Data • Types of surveys • Visitor Exit Surveys • Travel agent surveys • Delphi pannel • Hotel Registration information

13. The New Technology • The Blogs (trip advisor) can also provide a rich source of data for both the private sector as well as government agencies. • The private sector can use the feedback from these sites to improve on product deficiencies • Government can use this information as a feedback mechanism to ensure that product offerings are consistent with where the country promotes itself • In addition, rich content for advertising can come from this unsolicited source of data

14. The New Technology • The internet has facilitated competitive analysis which would have been very difficult years ago. • Tour operator /travel agent websites, airline websites, travel sites all provide competitive analysis on where countries are currently trading compared to other destinations. • Monitoring these sites consistently can also provide insight as to the state of the market at over time i.e a plethora of special promotions in the market would suggest difficult times for destinations and can trigger further market stimuli on the part of the destination

15. Target Markets • UK total population 60.9 million • USA population 305 million • Canada population 33 million • CARICOM population 16 million • China population 1.3 billion

16. Defining the target Market • We have used segmentation studies in all our major markets • USA- PRIZM • UK – ACORN • CANADA – PRIZM • EUROPE in process • CARICOM basic data

17. Segmentation Analysis • Addresses four fundamental marketing questions • Who are the target you want to reach? • What are they like? • Where do they live? • How can we reach them most cost effectively?

18. PRIZM ANALYSIS • The strategy for identifying our marketing targets is based on two tried and true observations • The customers of our product are existing customers • Birds of a feather flock together

19. PRIZM ANALYSIS • Methodology • Data Collected from E/D cards • Names and addresses of all USA customers • All duplicates removed from dataset • All VFR travelers removed from dataset • Total unique households

20. Who are the targets • US visitors are predominantly upscale and live in neighborhoods that run the gamut from urban to rural • 66.4% of all US visitors fall within 40% of US base household count (first 2 quintiles) • 42.6 % of US visitors fall into first quintile (20% of total) • Second Quintile contains 23.9% of all USA visitors to Barbados • 1.63 times as likely to reach our target audience within this group

21. Game Plan Categories Game Plan Categories: ·Core. There is a large proportion of customers in these clusters and households are more likely than average to be customers. ·Expansion. Households in these clusters are more likely to be customers, but there are not many of them in either the customer population or the base population. ·Conversion. Conversion clusters contain a significant proportion of customers; however, they represent an even larger proportion of the base population. Therefore, indices suggest they are less likely than average to be customers. Since these clusters represent a significant portion of total customers, they do have potential. However, because of their under representation with respect to the base population, there are many households that have not been reached yet. Target marketing strategies designed specifically for these clusters may attract or convert non-customers into the Core group. NonTarget. NonTarget clusters account for a small proportion of customer households, and indices suggest they are less likely than average to be customers. These clusters may require further analysis for classification due to their small numbers.

22. US Visitors

23. Tourism Authority’s-US Visitors Target Groups

24. COREGROUP

25. Expansion

26. Forming Target Groups Target groups were formed by selecting those clusters that indexed above (100+) and grouping those with similar demographic and socio economic characteristics. Target groups account for 65% of all US visitors to the island and 37% of the USA household counts

32. Where are the targets?

33. How can I reach them?

34. How can I reach Them?

35. Why segmentation • Segmentation and target marketing are central to our marketing strategy • Different customer groups require the correct marketing mix to suit their individual needs • NTAs operate on a limited budget which has to serve all major markets and therefore targeting ensures an effective allocation of resources in areas with a high potential for conversion

36. Product • The effectiveness of planning the marketing mix depends as much on the ability to select the right target markets as on devising a product which will generate high levels of satisfaction. • Tourist have to believe that the product offers high value. • There should be continuous monitoring of product via exit surveys

37. Product • The BTA consistently monitors the competition to ensure that our services are amenities being offered are consistent with market norms and encourage the local suppliers to enhance their products to reflect this. • Research will also develop strategies to lift the quality of products and services being offered on island and raising the national standards. • ZAGAT • AAA • Monitor the quality of all the components of the product and provide feedback to suppliers falling below the standards. • Duty free sector • Cleanliness drive

38. Brand Image • In order to effectively sell and promote a country we need to understand the consumers perception of the destination and determine what points of differentiation set the island apart from the competition • Conducting brand audits starting with the perceptions of current customers • Barbados for example trades on Friendliness, safety and security • The island that works.

39. Price • Extremely challenging for a destination marketing organization as they do not control any inventory • We cannot tell a supplier to sell his product at any specific price even if its priced above where it should be.

40. What do we do with Price • Develop structured or informal relationships with travel trade partners who have a ready supply of data available • They supply relevant market intelligence regarding the pace of bookings and what is being offered in the market i.e value for money • Conduct scans of the market as well as economic conditions to determine what national efforts need to be undertaken and what would constitute a compelling offer. • Several of these initiatives have been instituted within recent years within the region. However, there is a function for researchers to determine the success rate as well as the ROI. The use of E/D cards as well as Exit surveys extremely important in these evaluations • In order to determine this we have to determine the correct timing for the offer i.e the booking cycles of the consumer. • In determining the offer we calculate the return on investment to ensure its feasibility and benefits to the country.

41. Advertising & Promotion • Consistently conduct research to monitor our advertising and PR efforts in all markets • Consistently ‘word of mouth’ ranks very high as a PR vehicle for Barbados. Suggesting the need to ensure that the product is correct. • In recent years, use of the internet has been very important trend for Barbados. • Traditional media have been diminishing in effectiveness • Have therefore reoriented our communications efforts to reflect the changing environment

42. Testing of Concepts • Before launching any campaign it is tested either through focus groups or more recently we have embraced the new technologies to test our concepts to ensure that the message is most effectively communicated

43. Distribution • Again simple questions on the exit survey can provide useful insights into the distribution channels

44. Website Customer tracking • Enhanced Tracking - The Internet offers an unparalleled ability to track and monitor customers.  Each time a visitor accesses our website they provide us with extensive information including how they arrived at the website (e.g., via a search engine) and what they did when on the website (e.g., what products were investigated).  • This information is being used in the redevelopment of our new site and to provide information on interest of the consumer so that the relevant content is added to the website • Research Tools – A large number of Internet services have added options for conducting research.  These include the ubiquitous search engines, tools for conducting online surveys, and access to large databases containing previous research studies (i.e., secondary research).

45. Forecasting • Tourism is a highly perishable commodity. A room or airline seat not sold today cannot be sold tomorrow • This highlights the need for accurate forecasting as it has implications for jobs and the general health of the economy as tourism is the main engine of growth for many islands within the region • Countries can be proactive in devising strategies in the event of fall off in business. • The data from the E/D cards is useful as well as information from travel partners

46. Forecasting • The BTA reported this to the government for planning purposes. • This has resulted in a US$15 million fund being established to aid properties and attractions in distress due to the economic fallout • This will minimize job losses and to try to prevent any major downturn in the economy from the tourism sector as it is heavily tied to the other sectors of the economy

47. Rationale for Events • In order to maximize the marketing spend it is felt that events with significant television coverage can provide a destination with advertising and promotional opportunities which we could not have otherwise afforded. • The combined effect of a number of these events in the right segments can raise the destination profile. • Finally, the additional visitation for the events can boost the immediate needs of the industry.

48. Evaluation of Proposal • The evaluation of all proposals should be conducted based on the information sources available • This should be done with a ROI on these events in mind. • Must provide a minimum return of 20:1 to be a viable option • Coverage of the event must be significant band in line with the image and profile of Barbados.

49. Event Evaluation • Focus testing and surveys of participants to help with future events

50. ICC World Cup • Delivered in numbers for the island surpassing the ROI required • Significant coverage but in areas where the number of tourist not significant to barbados