Chapter
5
THE TOURISM
AND
HOSPITALITY
PRODUCT
Prepared by
Simon Hudson, Haskayne School of Business
University of Calgary
and
Marion Joppe, University of Guelph
5-1
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
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
5-2
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Tourism and hospitality
products
• selected components or elements of
the hotel, restaurant, entertainment,
and resort industries bundled together
to satisfy needs and wants
5-3
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Three Levels of Product: Core
• Core product
– the basic need function served by
the generic product.
– Examples
• airline or train = transportation
• hotel = shelter and rest
5-4
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Three Levels of Product: Tangible
• Tangible product
– specific features and benefits
residing in the product itself
– Examples:
• styling, quality, brand name, design, etc.
5-5
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Three Levels of Product:
Augmented
• Augmented 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
5-6
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Three Levels of Product: Theme Park
5-7
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Physical Evidence and the
Servicescape
• Servicescape
– 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
5-8
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Elements of Physical Evidence
Table 5.1
5-9
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
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
5-10
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Product Planning
• Product mix
– portfolio of products that an organization
offers to one market or several
– five basic market/product options exist
5-11
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
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:
5-12
– airlines with a product for business and economy
class travellers
continued...
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
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
5-13
Example:
- a heliskiing operator targeting the very rich
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Feature and Benefits Analysis
Table 5.2
5-14
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Product Life Cycle (PLC)
• Product 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
5-15
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Product Life Cycle
5-16
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Positioning
• The objective is to create a distinctive
place in the minds of potential
customers
• Four key positioning strategies
5-17
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Four Key Positioning Strategies
• Relative to target market
• business travellers, families with children
under ten, etc.
• By price and quality
• a premium product such as a room at the Four
Seasons Hotel
• Relative to a product class
• winter sports tourism category
• Relative to competitors
• Hertz Rental Car campaign “We try harder”
5-18
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
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
5-19
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
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
5-20
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
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?
5-21
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Packaging
• Packaging
– the process of combining two or more
related and complementary offerings into
a single-price offering
– customer benefits include:
•
•
•
•
5-22
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.
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
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
5-23
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Product Options in New and
Existing Markets
5-24
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
New Service Development (NSD)
Model
5.5
5-25
Copyright © 2009 by Nelson Education Limited.
The Tourism and Hospitality Product
Chapter
5
Examples of New Products
•
•
•
•
•
•
Gourmet holidays
Mobile check in
Smart glasses
Flying casinos
Branded hotel floors
Iceberg tourism
5-26
Copyright © 2009 by Nelson Education Limited.