The Marketing Strrategy Of Thomas Cook Tourism Essay

Thomas Cook marketing department: The task of the marketing department is to identify and plan holidays to meet potential clients’ needs and to ensure the company offer the right holidays at the right price to the right clients at the right time.

Marketing segmentation: Thomas Cook strategy on market segmentation is to continue to deliver benefits from existing cost saving and improvement plans already adopted by My Travel and Thomas Cook, so that they are able to grow revenues in existing and new ,market segments and to deliver efficiencies from being part of a larger group. 

The strategy focuses on the following key objectives:

integrating the businesses of the Enlarged Group and delivering the planned synergies;

strengthening the packaged tour operating businesses through continued operational and product improvements;

growing its business in the independent travel segment through tailored products and services delivered through an asset-light business model; and

Extending the financial services offering of the Enlarged Group through the introduction of new products and services and by building on the reputation and capabilities of Thomas Cook in this area.

(Source, Thomascook.com)

One of the Thomas Cook products (the Thomas cook 18-30 club):

The tour operator aims to create ambitious growth through successful market segmentation and positioning. The success of the Club 18-30 brand shows that well targeted products using a portfolio of distinguished travel products can provide a successful business strategy in the competitive holiday market.

The development of the Club 18-30 brand has been recognised as a dynamic response to the conservatism which has typified the UK market for overseas holidays.

The consolidation: When consolidations between tour operators occurs in this case Thomas cook and My travel, both organisation that have merged will increase its market share by an set amount over a set period.

The merging with My Travel was in an effort to cut costs and to increase competitive travel industry market. The companies estimate they can save £75m a year by combining and will have strong market positions in the UK, Germany, Scandinavia, the Benelux countries, France and Canada.

Source, Travel weekly

Brochures-

Thomas cook has three brochures each year and they are;

-Thomas Cook Summer sun

-Thomas Cook Families

-Thomas Cook Weddings

A ‘target market’ refers to the customers that a tour operator is trying to attract to buy its holidays. Typical target markets for which tour operators develop holidays include:

Singles

Families

Couples without children

Groups

Special interest market

Business travellers

Youth market

Activity market

Senior market

Thomas cook uses different style of designing depending on the holiday they will sell and on the target market:

One example is the ‘Thomas Cook Families brochure’ where the front cover will be printed with images that illustrate a family on the front page and showing facilities such kids clubs and other facilities and activities that the hotels offers.

Thomas Cook pays a lot of attention on their brochures front cover as it’s the most important since the client will see first of all, the cover must therefore be designed to be eye-catching.

Most of front covers of the Thomas Cook brochures highlights a ‘lead-in price’ i.e. the cheapest price in the brochures and specials offers, this ways they attract interested buyers.

The ‘Thomas Cook Families brochure’ below shows how they design the brochures to attract the specific group they want to sell their holidays to. The choice of pictures defines that the package holidays on sale are family oriented and what sort of products and services are on offer.

Parents with their children’s’

It shows little children playing.

Special offer shown, to attract parents.

External factors-

There are three external factors that affect the Thomas Cook Package holiday programs.

Environmental factors:

Can have a negative effect on holiday and the whole travel market, some example are the

Hurricanes in the Caribbean

Earth quake

Tsunami

Floods, etc

Those types of natural disasters can have serious consequences on an area’s travel and tourism industry.

When customers are booking holidays with Thomas Cook to destination that natural disaster occurs they are warned that the season they want to travel is natural disaster season i.e. Thailand- Patong beach, where the tsunami hit the beach in 2005 also the hurricanes Paloma Cuba 2008

Clearly it is difficult to plan for natural disasters: in this case Thomas cook has ‘contingency plans in place’ on how to deal with any problem arising at that moment.

The tsunami of December 2004 was one of the world’s most devastating natural disasters, killing nearly 300,000 people across a range of travel and tourism industry countries, including Indonesia, the Maldives and Sri Lanka

Technological factors

The dramatic growth in the use of the internet in recent years for researching and booking holidays is having a major impact on the way that tour operators sell their holidays.

Thomas cook has online brochures where clients can download and look through it in comfort of their own home, and when they are all done and have made a decision on where to travel they are able to go back on the website and book their holiday.

Economic factors

The current change in world currency exchange rate can wipe out a tour operator’s profit margins overnight.

Similarly, rises in the cost of oil and other natural resources can push up a tour operator’s costs and affect its profitability

Thomas cook tour operators use a number of method to try and reduce the impacts of these situations

Thomas Cook Group plc Reports shows that a decline in profit for the year 2009, reflecting higher tax expenses. On a pre-tax basis, profit grew from 2008, boosted by strong revenue growth in all regions. Additional, the company said it remains confident to perform in line with the economic expectations in 2010.

Source (TCG.L: News)

thomas Cook says it has seen no evidence of consumers cutting back on holidays despite the economic slowdown.

The firm says trading has been robust this summer and bookings for winter and next summer are set to be strong.

Thomas Cook chief executive Manny Fontenla-Novoa said destinations outside the eurozone, such as Turkey and Egypt, had proved to be popular.

A strong euro has deterred many holidaymakers from visiting the 15 countries that use the currency.

Mr Fontenla-Novoa said that the firm found that customers considered an annual holiday a “must have” item.

“In our experience, people will cut back on all sorts of other things before they cut back on their holiday,” he said.

“In the last six weeks of trading, our average price has gone up by 9%. Our all-inclusive holidays and our 4 and 5 star holidays are both up on last year by 10% and 13% respectively,” he added.

However, holidaymakers planning to escape the poor summer weather should expect higher prices and fewer last-minute deals.

Thomas Cook said its moves to cut capacity had left it with 14% fewer holidays to sell than at this time last year, while average prices were up 14% in the past three months.

Souce BBC NEWS.

Social factors

People are generally living longer and are choosing to have children later in life changes in the composition of families, working methods and the home/life balance, all impact on the products and services that tour operators offer their customers

Thomas cook they have to stay side by side with social changes and adapt their products to reflect a changing society. This is because they have to make sure the production of their holidays are match the social life of their prospective clients

Political factors

Today tour operators play a very important role in creating the images of destinations. They can significantly influence international tourism flows towards a country hit by safety and security risks. Even decisions of individual tourists on where to spend a holiday very often depend on the attitude and practice of tour operators towards a particular destination.

Sometimes tour operator will have to pull out of destinations completely because of political factors such as war or terrorism,

The effects of the 9/11 disaster in 2002 on world travel industry led to a drop of 15% in sales in the 2002, leading to £343.7m loss in core earnings that the firm would absorb with various cost-cutting measures.

still persist today, while recent bombings in Bali, Nairobi, Madrid and Cairo, have immediate impacts on tourism, although most destinations eventually recover lost trade

Legal factors: The laws

Package Travel Regulations 1992

This regulation makes sure that tour operators like Thomas Cook are responsible for their customers and what they can do if the regulations are breached. If they breach the customers has a case against Thomas Cook.

Under this regulation there are some principles that provide financial protection to the consumers.

-The tour operators are responsible for the safety of their customers whist on the holiday, this includes the safety in the accommodation, flight and (the all package).

-No tour operator should give/publish inaccurate brochure description.

-if tour operators became bankrupt there must be a guanranteed refund to all customers.

Trade Descriptions Acts 1968

All description given must be truthful and accurate, as this mostly affects tour operators, they have to be careful and make sure that all brochures descriptions stick to the rules of the Act.

Supply of Goods and Services Act 1982

Tour operators and travel agents both have to ensure that the booking of the holiday is carried out correctly and the contract of the holiday should also be carried out using ‘reasonable skills and care’

Unfair Terms in Consumer Contracts Regulation 1999

If consumers think that the contract with the tour operator is unfair, they may have a case against the tour operator.