Analysis the Potentials of Footsteps Historical Tours Company - Essay Example

?FOOTSTEPS HISTORICAL TOUR COMPANY Executive Summary Footsteps Historical Tours is a thirty-year-old, small-to-medium scale company which has enjoyed moderate success. Its founders and principal managers, Judith and Roger Ironridge, are historical researchers and enthusiasts, and they have found a way of sharing their love for history and for tourism through the company they have established. They have recently been joined by their daughter Izzy and her friend Max, who not only understand the use of computers and new media, but also have entrepreneurial ability and knowledge of possible new sites and the contacts to undertake them. In upgrading their IT capability, the company’s management has decided, upon the suggestion of Max, to set up a website with e-commerce capability so that together with providing information about the company, it will be possible for the customers to book their tours directly with them and allocate for the payment online. This study explores the potentials and provides the parameters for this type of service (historical tours) and how it may be enhanced by the new proposed internet enabling. The study provides a strategic assessment using SWOT, PESTEL, and Porter’s Five-Forces model, market analysis and proposed marketing mix, and a cursory plan for implementation of the website design project to actualize the e-commerce capability. The study provides a take-off point for a more thorough operational and financial investment plan that may be completed through incremental analysis, when more detailed data of existing operations are provided. Marketing Analysis Introduction Footsteps Historical Tours is a company which was begun thirty years ago by Judith and Roger Ironridge, husband and wife. The couple are both history aficionados, and at the beginning, both did the research. As time progressed, Judith needed to concentrate on administration. Although the number of employees has increased from the original 2 to the present 25 (which includes 10 part-timers), the increase in sales and the growth of the business has left the employees, particularly with Roger and Judith, with a heavy workload. While Judith works on the administration of the business, and Roger does the research and the outside broadcasts. With the arrival of their daughter Isabelle, the had additional help, and a new source of more innovative ideas for the business. Originally, Roger and Judith had banked on the creation of a CD Rom for publicity outreach purposes, as their I.T. knowledge had slowly began to catch up. However, a new friend of Isabelle, Max, was brought in to provide an I.T. proposal for the business, the couple were introduced to the idea of going online with its own website. Max happens to be adept in the field, and even ran his own business entirely through internet enabling. The proposed website will provide prospective customers for information about the packaged historic tours of the company; it is also proposed that the website shall provide a facility that will allow for the execution of transactions for the business. After consideration, Judith and Roger agreed to the plan. It is the intention of this report to provide a strategic analysis and marketing strategy for Footsteps Historical Tours, and a proposed plan for execution. Strategic analysis of ‘Footsteps Historical Tours’ PESTLE ANALYSIS FACTOR Type (Pos/Neg) Import-ance Political Factors · Stability of government in certain destinations · Social policies of destination countries / localities · Tax policies, particularly increase in petrol prices · Expansion of EU allows for greater mobility in new sites +/- +/- - + Moderate Moderate Moderate Crucial Economic Factors · Disposable income of target customers · Credit accessibility as a result of global crisis · Increased competition among other specialty providers · Interest rates can reduce net income · Exposure in foreign currencies if target site is outside UK +/- - - - - Moderate Crucial Moderate Moderate Crucial Social Factors · Public attitude towards outsiders, tourists · Impact of tourism income in certain destination sites · Changes in lifestyles and trends, more openness to commercial travel · Cultural factors (religion, traditions, customs) · Shifts in consumer preference for certain geographical sites +/- +/- + +/- +/- Moderate Moderate Crucial Moderate Moderate Technology Factors · New innovations and discoveries create interest in new sites · Reliance on quality of operations of associates and affiliates · Uncertainty of suppliers, increased energy cost · New tours launched by competitors + +/- - - Moderate Crucial Crucial Crucial Legal Factors · Documentary and other legal requirements for foreign travel · Terms with affiliates at destination sites · Competitive regulations, protectionism in certain localities · Health and safety regulations · Legal requirements for compliance (e.g. declarations, etc.) - +/- - +/- - Moderate Moderate Moderate Moderate Crucial Environmental Factors · Environmental protection laws of target and home countries · Waste disposal laws in localities · Effect of weather conditions on sales of tours · Effect of aviation, other transport on the environment +/- +/- +/- +/- Moderate Moderate Crucial Moderate Porter’s Five Forces Analysis: To complete the strategic analysis, Porter’s five forces model is herein provided: Competitive rivalry within the industry - The travel and tourism industry is a highly competitive one, because it is essentially a service industry and does not require a large capital outlay. There is a niche created by Footsteps, however, and this is the historical tours niche which caters to a particular segment of the tourism demand. Because it necessitates a different type of research to determine the content of a historical research, there is a slightly lower level of competition in this area, although competitors do exist. Threat of new entrants – New entrants in the field are going to find difficulty penetrating the content requirements of the historical tour, but this is not insurmountable. There is certainly a threat for new entrants, therefore it is important for Footsteps to develop strong networks particularly among its regular customers, most likely those who belong to the educational industry and historical societies. Bargaining power of suppliers – Suppliers in a historical tour are those who provide access to the historical sites and the facilities that will enable the customers to enjoy their sojourn in that particular area. The inclusion of Izzy’s friend Max in the company has increased the chances of sourcing new suppliers because of his familiarity with new sites which the company may target and open up new tours in. Bargaining power of customers – Bargaining power of customers is strong, because slight changes in prices could spell the difference of taking different tours. Most tourists are not highly particular in their destinations because their intention is to spend time away from their places of residence; and even if they may be intent on specific places, there are many alternatives that may be resorted to. Footsteps’ distinctive advantage should be the indepth research it has conducted, and whether or not it is capable of providing access to out-of-the-way or unusual sites of historic significance. Threat of substitute products – Unfortunately, for tourist travel there are always other alternatives. Those who would prefer to take the budget trips, or those tours that emphasize on shopping centers and commercial outlets, are likewise strong attractions to possible tourists. On the other hand, it is possible for people to look for friends or relatives of friends who could give them personalized tours. There being many alternatives, Footsteps should be able to market its product as a more convenient, cost effective, worry-free way to see the best historical places in any one tour. Marketing Plan The marketing plan is comprised of the seven P’s of marketing, namely product, place, price, promotion, people, physical evidence, and process. Product - The product is an online travel booking service that has e-commerce capability and internet enabling. It also provides for the added experience for travellers and tourists, such as singles weekends and other similar novel experiences. The product is not merely the sum total of tangible goods that may be acquired, but moreso the experience of travel and leisure. Place (Distribution) - The place or distribution channel contemplated is the online availability, that is, the service provided should be accessible from anywhere that may be accessed by the internet. This has the added advantage of cost efficiency aside from what may have been substantial expenses in a brick-and-mortar outlet. Price - The price of the service should be reasonable to the public, particularly during this time of economic crisis. The use of online booking is particularly helpful, because it entails a lower cost, the savings of which could be passed on to the customer. Promotion - The website itself performs as the promotion for the product, which is the service offered in the webpage. Because of this, there is no need to spend for costly advertising campaigns or the need for a People – There is a present compliment of 15 regulars and 10 part timers in the company. The addition of Izzy not only as assistant but as management staff is a welcome development. There is a need to hire at least a website manager, however, in order to monitor the transactions that may be coming in over the web. The volume and traffic expected cannot as yet be gauged, so if these are expected to be substantial, the need for additional personnel should thereafter be determined. Process – The process of online booking and e-commerce capabilities is a highly technical one from the company’s end, but it should be designed to be easy and flexible from the point of view of the customer. Therefore, it is necessary to conduct continuous assessment and development of the technology as well as the aesthetics of the website; the customer should find it easy to look for information, conduct a transaction, submit questions to the company which the latter should quickly respond to. Most importantly, the process should include a method of verifying the accuracy and execution of a transaction, and should be able to confirm this to the client within a short time. Physical evidence (software and hardware requirements) – The following are based on the recommendations of technical personnel in web design and development: PHP (backend)- A widely used general purpose scripting language suited for web development MYSL (data) HTML (website layout) CSS (website design) JS (user interaction) DEDICATED IP SSL PAYMENT GATEWAY (for UK client can use paypal) Or the client can just use content management system like Magento. For Forum. PHPBB is recommended. It is a free forum that can easily be installed on your hosting and it is easy to manage as well. Otherwise, the client can just register a free forum in www.forum-motion.com. Provide for WEB HOSTING, i.e hostmonster.com. ($7/month) Desktop workstations approx ?700 Investments The company will not need to invest much in new hardware except that which has already been indicated; much of the web hosting facilities could be carried out in their existing work stations. There is a need to subscribe to PayPal (online settlements and payment transmittal) and a need to pay the upfront cost to the web developer, but this latter expense is a one-time cost, with periodic updating and maintenance entailing lesser amounts. It is possible that payback period for the initial incremental investment for the online e-commerce facility, depending upon the frequency and size of the transactions, could be attained within the year, maybe a few months. Stages and recommended timescale for Footsteps Historical Tours for IT project. The most important steps in the website design procedure may be integrated into five fundamental processes (Puri, 2010): The first step is the consultation between the web developer/designer and the client. Before the website is designed and actually created, the designer must have a thorough understanding of what it is the client expects of their website. Not only the web designer or developer, but the whole team must be made conversant of the taste and preference of the customer. The second step is the targeting of a unique selling point, or USP. It must be recalled that there are countless websites of numerous package tours, many of them direct competitors of Footsteps for offering specialized niche travel options. Therefore, there must be a distinguishing feature for Footsteps that should set it aside from its competitors. Given the clientele being history buffs, beautiful eye-catching scenery or sights and an easily maneuverable page would be of great help. The web page must also have a distinct and engaging feel unlike others. The third step is the actual website creation and production. This process requires several steps, such as: the selection and registration of a web site domain name; the selection and configuration of a web site hosting service; the design, coding and intermittent testing of the website; the deployment, and the promotion of the web site for actual run. The web site design shall contain forums, polls, guest registrations, search capabilities, data entry forms, and data base allocation. Furthermore, to enable Footsteps to transact online and book services, it must be endowed with e-commerce capability. For this reason, there is a need for the company to contract a reputable and secure service for payment processing and remittance. A good prospect is PayPal, a highly popular and reliable secure online payment service. The fourth step is testing, although this is not just one distinct step. It is recommended that after each major step in the web design and production process, a test run should be made involving the previous and most recent changes. By doing intermittent testing, any errors may be detected early and corrected immediately, thereby greatly adding to the speed and accuracy of developing the website. Also, a major online test should be conducted prior to deployment to the customer of the finished product for live runs. Finally, there is the deployment and traffic generation of the finished web site. After launching, traffic generation is performed in order to bring to the attention of the surfing public the presence of the new website. This is done by search engine optimization, which enables the website to land at the highest position of the search, thereby creating the highest possible traffic of hits to the site. The following steps and their estimated time durations (as per consultation with technical staff) are listed below, assuming a 6 month duration for development: 1. Client consultation – 6 weeks (may run concurrently with the other activities) 2. Market research – 1 week 3. Personnel and materials sourcing – 1 week 4. USP creation – 1 week 5. Front-end web design – 2 weeks 6. Back-end web design – 12 to 13 weeks 7. Deployment testing – one week 8. Deployment and traffic generation – 6 weeks The time table envisioned for this project is presented in the Gantt chart below: References: Anon. 2006 “UK insurance: travel agents are losing market share.” MarketWatch: Global Round-up, Feb 2006, Vol. 5 Issue 2, p102 Britannia Website. Accessed 10 February 2011 from http://www.britannia.com/ Fyfe, D A 2008 “Birthplace of Baseball or Village of Museums? The Packaging of Heritage Tourism in Cooperstown, New York.” Journal of Sport & Tourism, May 2008, Vol. 13 Issue 2, p135-153; DOI: 10.1080/14775080802170361 Goodman, B 1998 “Unwrapping the package tour.” Money, May98, Vol. 27 Issue 5, p165 Jones, R 2006 “Direct choice: Virgin Holidays.” Marketing (00253650), 10/25/2006, p10 Ooi, Can-Seng 2001 “Tourist Historical Products: Packaged Pasts of Denmark and Singapore.” Scandinavian Journal of Hospitality & Tourism, Dec 2001, Vol. 1 Issue 2, p113-132; DOI: 10.1080/150222501317244038 Schiller, K & Lisella, M 2002 “Tour Operators Eye Online Entities' Entry Into Packaged Travel Arena.” Travel Agent, 8/26/2002, Vol. 309 Issue 7, p129 Strauss, G 2009 “Packaged tour of 'The 1930s'” USA Today, 10/26/2009 Taylor, I 2006 “Failures highlight protection mess.” Travel Weekly: The Choice of Travel Professionals (00494577), 9/15/2006, Issue 1838, p2 Tucker, H 2007 “Performing a Young People's Package Tour of New Zealand: Negotiating Appropriate Performances of Place.” Tourism Geographies, May 2007, Vol. 9 Issue 2, p139-159; DOI: 10.1080/14616680701278497 Woods, L & Parmelee, J 1997 “Not your father's tour.” Kiplinger's Personal Finance Magazine, Jan97, Vol. 51 Issue 1, p162 www.statistics.gov.uk Read More