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Case Study Events Industry

3766 words (15 pages) Essay in Marketing

25/04/17 Marketing Reference this

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”The rapid growth of events in the past decades led to a formation of an identifiable events industry, with its own practitioners and suppliers and professional associations” (Allen et al., 2008 p, 17).

Events industry has a huge potential to be a sustainable resource of economic income for destinations and provide many opportunities for the development and renewal of city. Specifically, events can present a major impact on the tourism and hospitality sector. The development of events is becoming increasingly significant in promoting the economic including tourism and hospitality industry in a destination. The different elements of the events, which include festivals, arts, sports events, exhibitions, etc., have been the important factors to attract the residents and tourists. Events have been a significant support, especially for the destinations, tourism cities and countries. In addition, the local economics can be benefited by the local expenditure on service by the organizer and participants, and positive effects are also can be generated by the promotion and media activities for the events (Allen, et al. 2008). For example, it is presented that the festivals play a significant role in the developing audiences and in training, supporting administrators and artists (Bowdin et al. 2006.).

In addition, events mean highly a symbolic representation (Getz, 2007) to the culture which is one of the most important phenomenon’s to events. Basically, most event activities are a kind of reflection of the local and national culture and society. For instance, Festivals are a social phenomenon in the human cultures, and have been marks of the cultural events because they bring people back into old traditions life, with history and local culture (Frisby and Getz, 1989). Just as Falassi (1987, p. 2) said, festival means” a periodically recurrent, social occasion in which, through a multiplicity of forms and a series of coordinated events participate directly or indirectly and to various degrees, all members of a whole community, united by ethnic, linguistic, religious, historical bonds, and sharing a worldview”. The symbolic and social functions of festivals are related to a kind of value that is recognized by the communities as vital to their worldview, to their historical, physical and social identity (Falassi, 1987).

With the increase of the customers and economic benefits, more and more attention is paid to the events industry, the management of events industry have to be more professional and sensitive to the development of the marketing.

2.1 Market Segmentation

Marketing is a critical process for all business. A series of effective marketing strategy play an important role in the development of business. As presented, marketing is a management process that should be responsible for identifying, anticipating and satisfying customer requirements (CIM, 2001).The point of marketing is that managers should focus on the strategies to identify and satisfy the needs and wants of the different groups of the customer.(may be add some detail)

For events, a relatively new industry, the events marketing has been transformed from an organizational afterthought to a professional discipline upon which the association depends for its own livelihood (Hoyle, 2002). As Levitt(1980, p, 16) presented , ”Marketing is that function of event management that can keep in touch with the event’s participants and visitors, read their motivations and needs, develop products that meet their need, and build communication program which express the event’s purpose and objective”. Marketing is playing a significant role in the events management. As a kind of “service experience” industry, events sector is intangible and variable. Be different with other industries, there is no “real” product in terms of event sector. The core phenomenon of event is “experience” (Bowdin et al. 2006.).The aim of the event planning is to shape and enhance the participants’ experience of these items. In addition, for most customers, events and festivals are kinds of leisure activities that should satisfy at least one of their perceived needs (Bowdin et al. 2006.). So, the most important thing for event management is to motivate and attract customers get involved in and experience it. Event manager are responsible for identify and segment the different customers groups, meantime, formulate related communication actions to reach and attract the different target customers.

2.1.1Concept theory of market segmentation

There are a series of steps and disciplines involved in the process of successful strategic marketing, such as targeting and segmenting market, promoting and communicating the events to the target segment. As Bowdin et al. (2006. P. 199) state, ”most events do not appeal to everybody, so it is essential to identify those consumer segments whose needs mostly match the events experience.” The different members in the market may have different perceptions of the benefit the received from the events.

Management strategies and specific marketing plans are dependent on factual customer data (McCleary 1995). Segmentation is a powerful marketing tool because it brings knowledge of visitor identification. Segmenting the marketing is one of the most important distinct steps to create successful strategies for events marketing. In addition, market segmentation is closely related to the promotion and communication strategies because the specific promotion and communication plans must focus on the target market (Bowdin et al., 2001). For example, a mega event with large and mass consumers can use a wide range of promotion and advertising plans, including the television, internet, and newspapers, and each of these ways has different advantages and disadvantages. A good segmentation of market can help the operators take full use of the different promotional techniques.

The economic theory of market segmentation evolved from 1930s (Frank, 1972). The concept of segmentation is based on the proposition that consumers are different, and the differences in consumers are related to ther different market demands ((Frank, 1972).

The emergence of market segmentation has a great deal to do with the development of the reorganization of market diversity. With the increasing diversity of the output of the goods and services, a shift was happened that the orientation of the management changed from the focus of the product and finance to the understanding of the needs of customers. Segmentation is based on the development on the demand side of the market and the need to satisfy the different demands of the consumers. As defined by Simith(1956),segmentation represents a rational and more precise adjustment of the product and marketing effort to consumer or user requirement. He recognizes that segmentation derived from the heterogeneity of customer want (Simith, 1956). It reflects that segmentation is a market orientation rather than production orientation.

According the study of Claycamp and Massy(1968) the concept of market segmentation was developed in economic theory to show how a firm selling a homogeneous product in a market characterized by heterogeneous demand could maximize profits. It shows that optimal profits are able to be achieved if the firm uses consumers’ responses to segment the market and sets price and output of the products.

With the development of the market, the perception of market structure is formed on the basis of the segmentation strategies for the managers (Johnson, 1971). It was noted that market segmentation is a marketing concept involving artificial groupings of consumers constructed to help managers design and target their market strategies (Wedel, 2001).

Nowadays, market segmentation has been a popular and useful market strategy for many businesses. It was recognized that market segmentation is a process of splitting customers, or potential customers, in a market into different groups, or segments (McDonald and Dunbar, 2004)), and it is pursuing a marketing strategy whereby the total potential market is divided into homogeneous subsets of customers, each of which responds differently to the marketing mix of the organization (Reid and Bojanic, 2006).

2.1.2 The multi-methods of market segmentation

Although a complete discussion of the criteria for the segmentation has been conducted by many researchers, it is necessary to point that there are some rules for the bases for market segmentation. For example, the variables should be measurable and accessible by the managers (Frank, 1972,). The market segments chosen should be substantial enough in size to be worth targeting and accessible by normal marketing communication channels (Bowdin et al., 2006).

Generally speaking, a market can be segmented in a number of ways. Among the more frequently used bases for market segmentation are Products and services, geography, demography, psychograph Socioeconomic, personality, and lifestyle, etc (Frank, 1972).

It is a common way for many industries to segment market according to the products or services offered because many different types of customers buy or use the same products or services for them (McDonald and Dunbar, 2004). In addition, needs of different customers can be satisfied by understanding which particular features of the product or service, along with features associated with all the other aspects of a purchase (McDonald and Dunbar, 2004). Customers are able to seek to attain the benefits they are looking for through these features. Once this is understood, the needs-based propositions required for different segments can be developed.

Geographic segmentation is a commonly method that based on the place of the residence of the events visitors (Frank, 1972). The most common form of geographic segmentation is by region. It was assumed that everyone in a predetermined area can be expected to react to a particular offer in exactly the same way (McDonald and Dunbar, 2004).The buying behaviour can be different for the people lived in different regions. Dobriner (1963) identifies basic differences in the behaviour pattern of the city families and suburban families. In addition, this type of information of customers can identify the most likely locations the customers in each of the segments and help managers determine how to access those targets (Frank, 1972).

In the early stage of the development of the events industry, many events are dominated by the local visitors. So, the managers always focused more on the local customers as their major market segmentation. However, with the development of the society, there is an expansion of the geographic market because of the increasing convenience of the transportation and growing efficiency of the exchange of the information. More and more visitors from other regions and countries were attracted by the events. An event would have a wider regional geographic segmentation for its more specialized events experience.

Be different with the geographic segmentation, demographic segmentation concerns the measurable characteristic of customers, such as gender, age, income, education, culture, etc. one of the most important reasons for the popularity of demography is its ease of measurement. In addition, it is able to access to these segments by diverse communication and distribution methods and media ((Frank, 1972). Demographic segmentation is a method that divides the market according to the relationship between demographic characteristics and buying behaviour. It was noted that physiological, psychological and cultural factors contribute to differences between genders and different age groups, which lead to different patterns in buying behaviour (Frank, 1972).

This kind of information about customers can be used to identify the particular profiling characteristics associated with the customers found in each segment. In other words, demographics helps identify who is found in each segment which, in turn, will help you determine how to reach them((McDonald and Dunbar, 2004)

Psychographic segmentation is another popular and useful techniques, and it is kind of method that dividing the market according to the lifestyle and values (Bowdin et al., 2006).It not only provides the means of catching the attention of target groups in an ever cluttered world of communication, also can provide the means by which you isolate and reach particular segments.

The concept of lifestyle has been recognized by marketing scholars as an important determinant of human behaviour (Frank, 1972). Lazer(1963) noted that lifestyle is a major behavioural concept for understanding and predicting consumer and business behaviour. The use of values as measure of life style is relatively new. Rokeach(1968) claims that it is a standard to tell people what they want and how to act. it is also able to get how the values and attitude influence the consumers. Lifestyle reflects the overall manner in which people live and spend time and money. In addition, Levy(1963) defines that the concept of lifestyle delivers a emphasis in motivation and action.

Motivational factors represent the personal psychological components- such as needs, expectations, benefits sought, and achievements-that are likely to be satisfied through the product. As Fodness (1994) points out, motivation represents the major driving power in explaining human behaviour, although it is not the exclusive factor. For events industry, these kinds of factors are significant to attract the customers. In the case of festival visitors, attending concerts and visiting exhibitions are examples of activities that contribute to the overall event experience (Backman et al. 1995)

There are also some limitation and problems in terms of the application of the psychographic segmentation. For example, it is a main problem the psychographic segments are difficult and expensive to define and measure, and relevant information is much less likely to exist already in the public domain (Bowdin et al., 2006)). However, although lack of the theory of the lifestyle, the use of lifestyle as basis for segmentation is conceptually attracting because the consumers needs and behavior are much more complicated than before. It is necessary for managers to recognize and satisfy those demands.

2.1.3The meaning of the market segmentation

It is obvious that market segmentation can improve sales and profits because it allows the organization to target specific market segments.It also permits the organization to allocate scarce marketing resources more effectively aimed at those market segments with the highest probability of purchasing the organization’s products and services. Using market segmentation, companies can identify those market segments that are heavy users of their products and services. At the same time, segments that hold little potential for using a company’s products receive little or no attention. So, managers are able to take full use of the marketing resources by market segmentation.

Foote (1972, p24) notes that market segmentation is a competitive strategy that will find the going much easier and much profitable. The process of the market segmentation was viewed as a “tripartite matching of customers and offerings and the array of competitors in the market”(Foote ,1972).

Businesses from all industry sectors can use market segmentation in their marketing and strategic planning. For many business, market segmentation is regarded as the panacea of modern marketing (Wind, 1978) because the market segmentation can helps businesses deal with and balance the conflict between the variability in customers’ needs and the limits of available resources (Dibb, 1998), especially for the local community.

In terms of event sector, segmentation can be used effectively in all facets of events industry. The events industry is rapidly developing and made a considerable contribution to other businesses related to the tourism and hospitality. With increasing government and stakeholders involved in, the operating environment of events is becoming complex than before. It is required that the events managers and operators should identify and make service to a wide range of stakeholders and to balance the needs and objectives (Masterson and Wood, 2005).

2.2 Communication and promotion strategies for events

2.2.1Integrated marketing communications

Integrated Marketing Communications (IMC) is one of the most popular communication strategies in the world. As Kitchen et al.(2004. p,19) state that ”Integrated marketing communication means to bundling all promotional mix elements together to create the ‘one-voice’ phenomenon, then it is not saying much that is new, relevant, or even interesting. ”. Marketing communications is a part of marketing process. Where “promotion” was the primary term for the communication elements in the marketing mix, the use of “integrated marketing communication “(IMC) has overtaken it. Integrated marketing communication considers all source of contact that a consumer has with the event as potential delivery channels for messages and make use of all the communication methods that are relevant to consumers (Shimp 2003)

IMC strategy reflects the thrust of the chosen objectives and uses both message and media strategies to fulfil them. It was emphasized that integrated marketing communications has been advanced in response to perceived failures of mass media, new media options and demands from clients for demonstrating the return on investment from marketing efforts (Masterman and Wood, 2006, ). IMC is highly targeted both stakeholder and customers and it combines all the communications tools for consistency and synergy, and stresses relationship and branding goals ((Masterman and Wood, 2006,).

In the models of the ”mindscape of integrated marketing communication” (Hartley and Pickton 1999) and ”the wheel of integrated marketing communication” (Pickton and Broderick, 2001) , the marketing communication was presented included the categories of advertising, sales promotion, public relations and personal selling, also give a number of different ways for theses items to overlap and to be used . It is obvious that an appropriate and variety of communication tool is necessary and beneficial to ensure consistency of the message and complementarily of the methods (Masterson and Wood 2005).

IMC mix include a wide range of marketing communication methods, such as advertising, personal selling, sale promotion, public relations, word of mouth, E-marketing, etc. Events manager can take use of them to reach the different consumer clusters according to the strength of the different methods.

Advertising is any form of non-personal promotion paid by the event organization (Bowdin et al., 2006). There are many channels for advertising, such as radio, television, newspapers, magazine, internet. For events, the advertising is a creative process of producing the message (Bowdin et al., 2006). Be different with other industries, it is vital for event sector to provide customers tangible clues to counteract the intangible nature of the event.

Public relation is an important method to build beneficial relationships with stakeholders and customers. A wide range of tools involved in, such as publicity, community consultation, E-publications and traditional newsletters (Bowdin et al., 2006). Events managers often favour media publicity because it can provide unpaid space in the media that reaches the events market compare with others.

Direct marketing communicates one-to-one with existing festival or events through telephone, mail, or internet. It relies on organizers developing a list of people who attended the events to obtain information of the customers preference.

”Regardless of the nature of your event, its success will largely depend on the promotion. ” (Hoyle, 2002, p.32).The effect of promotion on consumption is fundamental. Organizations use promotion to communicate with customers about products they offer, especially for events. The general promotion plan is the main weapon to draw people’s attention to the product, because promotion plays a significant role in creating awareness of the event, a desire to participate, a feeling that benefit the events by involved in even with investment of the money and time. Promotion is thus one half of the communication process with customers……

3. Methodology

3.1Research method ?

Case study

As a single case study, the research will focus on the Sensoria organization.

3.2 Data collection methods ( the order of the three methods?)

According the aims of the study, both qualitative and quantitative methods will be attributed. There are tree parts in the research methods of the study including an interview, questionnaire and observation.

3.2.1Questionnaire

At the first stage of the research, questionnaire is used to collect data of the customer information for the study of the market segmentation and to evaluate the attendees’ perception.

Questionnaire is one of the most widely way to collect data, the data obtained by using a questionnaire are standardized, allowing easy comparison.( Saunders, lewis and thornhill, 2003).A questionnaire could be defined as a formal schedule of the questions complied to assemble information(veal, 1997).Some researchers consider it as a way for the survey where people answering the questions actually records their own answers (kervin, 1999). Others thought questionnaire is a more general term to include all techniques of data collection in which each person is asked to respond to the same set of questions in a predetermined order (de Vaus, 2002) . The questionnaire survey technique can be adopted to reveal objective information about respondents and investigate peoples’ opinions, attitudes, and views(Denscomble, 1998). The advantage of the questionnaire survey is that it is a quick way to collect information(Bell, 1999).

The design of the questionnaire

After several meeting of the manager of the sensoria, some detail and related questions was add to the questionnaire used in last two years.

The structure of the questionnaire

3.2.2 Observation

A participant observation also is used as an important way to collect data of the customers perception of the event.

Observation is an appropriate way for the questions and objectives which concerned with what people do (Dawson, 2009). It can be conducted in different kinds of social settings; involve different forms of relationships with the persons being observed. Observations differ in terms of the role the observer takes in relation to the persons or groups being observed(Saunders, lewis and thornhill, 2003) .On one hand, the observer can simply observe without having interaction with the subjects being observed. On the other hand, the observer can join and participate in the group being studied. Observational methods vary greatly various in terms of the amount of structure provided for the observer (Dawson, 2009). Participant observation is a method that can be used as a very valuable tool, especially in combination with other methods. It is particularly useful for researchers working in an organization or program ((Dawson, 2009).

3.3.3 Interview

In addition, a semi-structured interview is conducted according to the information of the literature review.

An interview is a purposeful discussion between two or more people (Kahn and Cannel, 1957). Interview can help the researcher to get reliable data. There are several different types of interview can be used according the varied situations. The use of interview based on the standard and identical set of questions (Saunders, lewis and thornhill, 2003). In semi-structured interviews, the researchers have a list of questions and themes to be covered. There is a high flexibility with semi-structured interview. It is able to require some additional questions to achieve your objectives. In addition, the semi-structured interview can provide the researchers the opportunity to “design” the answers. It is helpful and important for your achievement of the objectives (Saunders, lewis and thornhill, 2003)

The structure and content of the interview

3.3 Weakness of the methodology

The questionnaire has to be conducted before the interview because of the time limitation, which influence the design of the questions.

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