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The writer of the paper “Marketing Audit” states that few things can be added to the available strategies so as o enhance the probability of success. As for example, Visit Britain can arrange lucky draw offers which will add goodwill to its brand as people will urge for many more lucky draw offers…
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Marketing Table of Contents Marketing audit 3 External factors 3 Porter’s Five Forces 7 Internal factors 10 Summary report on situation analysis 10 Critical analysis of the current plan 10
Identification of 3 potential strategic options for Visit Britain 11
Yearly holiday package in UK 12
Recommendation for marketing mix 12
Reference list 13
13
Marketing audit
The marketing audit highlights appraisal or review of existing marketing activities. The audit provides an opportunity to analyse and appraise the marketing activities by emphasising on the present and past performance. The marketing audit is used as a reference tool for highlighting the changes in internal and external business environment. The following external and internal factors of the present business environment are elaborated in context to travel and tourism industry.
External factors
The external factors that can affect Visit Britain in United Kingdom (UK) can be divided into three groups: competitive, economic and market environment.
Economic environment
The economic environment is described with the PEST analysis.
Political
The political factors that are considered by Visit Britain are detailed below.
Tourism tax proposals
Presently, the travel and tourism industry of UK has requested the Government to abandon tourism tax proposals. The concern for bed tax has increased the fear that price of the foreign and domestic visitors have rose and as a result the visitors encounter price constraint. The rules and regulations of the government gave the local authorities to access their power by imposing tax on overnight stays in guest houses, hotels, beds and establishments. It is observed that England has become the highest taxed holiday destination in Europe. There is 1% increase in prices of hotels which has lead to 1.4% decrease in inbound visitor number. The tax has also affected the regular business of the restaurants, local shops and tourist attractions, which have also suffered from knock-out effect of the falling number of visitors (VisitBritain, 2014).
Probe into Sales of UK travel insurance
Presently, the HM treasury have decided to probe into travel insurance department and have suggested new legislation if the travel and tourism industry is undertaking any mis-selling strategy. It is observed that about 20 million travellers buy travel insurance each year and the market is predicted to worth around £ 650 million in 2006 (Key Note Limited, 2006). In spite of paying the large amount of money, people are not getting the appropriate coverage. They are provided with the travel insurance which does not even have proper terms and conditions. Thus, the probe will restrict many tourism companies to operate freely (Key Note Limited, 2006).
Reforms related to EU Aviation Law
The new pricing rules in the airline industry are attached with the broader reforms of EU aviation law, which is devised to bring the whole sector under single legislation. The European Commission has set stringent rules for the companies in the airline industry to fully lease the crewed aircrafts that are based outside the EU (Key Note Limited, 2006).
Economic
Proposal to increase air travel tax
The committee of MP in UK has declared that tax imposed on gas guzzling cars and air travel in order to decrease the greenhouse gas effect. House of Commons Environmental Audit Committee have declared that the transport sector of UK have increased carbon emission in the economy for the past few decades. The rise in cost of petrol has resulted from increase in fuel tax. The rise in price of petrol is mainly to prevent road usage and this event has caused wide spread protest during 2000 (Key Note Limited, 2006).
Failure of many companies
The breakdown of ATOL bonding consumer’s protection scheme has lead to the increase in the number of company failures during the peak season and thus there was sharp rise in fraudulent activities within the tourism industry to avoid failure.
Change in climate increases the number of tourists in UK
In future, the climate of UK can change drastically, which may bring changes in the British tourism too resulting in flocks of European tourists coming in UK for avoiding the scorching summer. Thus, the number of tourists may increase drastically in UK if the climate changes. It will bring profit to the tourism industry and UK will be regarded as the best holiday destination in Europe (Miller, 2001).
Social
Attract more potential visitors
The national registered charity tourism in UK and VisitBritain has worked together to assure that the mobility impairments and sensory people can experience the joy of holidaying as rest of the population. It is observed that there are around 10 million disabled people in UK who have a combined spending power of £50 billion. These disabled people have the desire to travel at a regular basis but they feel unable as there is lack of facilities (Gooroochurn and Sugiyarto, 2005).
Homeworking Takes Off
There are many travel consultants who are operating their business from home. On the other hand, there are many travel agencies who are struggling to attract recruits in their organisation. Thus the tourism industry has encountered this challenge with the increase in home working business.
Responsible tourism
The travel and tourism industry have constantly been attacked as it has damaged the environment to a great extent. The travel and tourism industry have developed policies to prevent the damage caused by the travel and tourism companies.
Technological
WEE Directive
Technological shift has changed the outlook of travel and tourism industry and have increased competition worldwide. It is known that technology has rapidly become obsolete over the years and as a result the companies in travel and tourism industry have adopted the new technologies.
Facility for online check-in in hotels
The hotels in UK have followed the sets of regulation of the airline industry and have arranged for online check-in. The online check-in has helped the tourist to rely on the fact that they will get accommodation as soon as they reach their holiday destination point. Different hotels in UK have concentrated on investing a lump sum amount for developing a strong online system which will help the tourist to get accommodation and information easily.
Dynamic packaging
The dynamic packaging in travel and tourism industry has continued to evolve and the desire of the consumers for choosing flexible travel arrangement. The demand for the dynamic packaging has created scope for the low cost airlines.
Porter’s Five Forces
Rivalry among the existing competitors
The rivalry in travel and tourism is fierce as compared to other industries in UK as there are a number of companies, which offers the same facilities to the customers. When the customers are aware of the same facilities provided by the different companies, it is difficult for them to choose the best one. The travel and tourism companies that are prevalent in UK are Earth Travels and Tayal Tours and Travels. In order to stay ahead of the competitors companies, Visit Britain can invest in organizing sales promotion campaigns which will promote their facilities offered to the customers. Advertising the new products are very crucial for the companies, likewise Visit Britain should do the same in order to attract the exciting offers related to day night stay packages and tours. As there are many travel and tourism companies in UK market, hence the competition is high and almost all of them apply same strategies for attracting customers. There is no differentiation in the products and the players of the market hence there is increased price competition. The barriers for market entry are high as a result the new companies have to encounter a lot of challenges (PwC, 2014).
Threat of new entrants
New entrants actually bring extra capacity in a particular market. The entrants’ acts as threat to the existing companies as the latter may lose their market share. The former have the capacity to make vital changes in the overall market environment. The new entrants are always a threat to the existing players as they offer products or services to the customers at a lower price. In travel and tourism industry of UK, the threats of new entrants are low as there are barriers for entry, which are developed by the tourism government of UK. The barriers to entry in this industry in UK can be explained by economies of scale, cost advantage for the existing players as the experience curve affects the functions of the depreciated assets (PwC, 2014).
Brand loyalty to customers also matters so the existing companies have this advantage over the new ones. Visit Britain has to encounter these challenges in order to enter UK market. The existing companies protect their intellectual property such as licenses and patents thus it is difficult for the new entrants to copy the business model of the existing firms. The access to the raw materials is limited in case of the new entrants and thus it is majorly controlled by the existing players of the market. Hence, Visit Britain can encounter scarcity of the raw materials such as the items required in the hotels at the beginning of the business. The distribution channels are also controlled by the existing big players and as a result it is difficult for the new entrants such as Visit Britain to manage these distributors (PwC, 2014).
Threat of substitutes
The products or services in any industry are subject to substitutes; these substitutes have the ability to restrict the capability of initial company to charge prices for the products or services. If the customers find alternative products or services at a lower price they are naturally attracted towards the same. In travel and tourism industry there is no exact substitute for the services offered by the companies (PwC, 2014).
Bargaining power of suppliers
The bargaining power is defined as the ability to have impact on the prices that are initially set. It can be stated that the suppliers can have huge impact on the profitability of a company if they exert pressure on the latter to pay them high prices for the delivery of the needed products or services. However, if there are a number of distributors in the market, then the company chooses the best one and here the bargaining power of the distributor increases. In order to find the best options of materials, the companies switch the distributors when they find their option. The purchasing industry earns higher profitability than the supplying. Visit Britain has to be more strategically in order to survive in the situation (PwC, 2014).
Bargaining power of consumers or customers
Bargaining power of customers actually depends on the level of differentiation between products. It also depends on the cost of product switching. If the customers are receiving adequate profit margin from a company then they are encouraged to stick to their decisions. The bargaining power of the customers is high when they aim at buying larger amount and there are a number of suppliers. In case of Visit Britain, the customers can find alternate options if they are not satisfied with the price structure of the company (PwC, 2014).
Internal factors
The internal factors of marketing audit include human resource, services or products, operation and finance. All the factors are very crucial for Visit Britain as each of them is required importantly for the success of the company in UK. Adequate number of skilled employees is needed who can have in depth knowledge regarding the travel and tourism industry.
Summary report on situation analysis
Successful tourism in UK has resulted in increase in the amount of income of the tourism companies. It has resulted in 30% of export of services in the world as well as 6% export of products or goods (Gooroochurn and Sugiyarto, 2005). Hence, it can be stated that tourism in UK has gained prominence despite the challenges that are encountered by the industry. Visit Britain is a good initiative to attract visitors to UK and increase the income of UK companies, who are engaged in providing these types of services to the visitors. The company aims at making Britain the main hub for visitor and make it a brand for all by addressing the weak points of place and portraying it as the strength. The external and internal analysis related to Visit Britain highlights the fact that the travel and tourism industry in UK have a number of challenges among which majority are external challenges. In order to overcome the challenges the Visit Britain has to devise potential strategies, which are elaborated below.
Critical analysis of the current plan
The current marketing plan has clearly identified the strength, threat, weakness and opportunity. The best part of the situational analysis in the current plan is that Visit Britain has the aim of making London as the best holiday destination spot for the visitors and helps the economy to grow constantly. Visit Britain also aims at developing London holiday package which will help them to attract more customers who are basically the visitors in UK. London is a well developed tourist spot, which attract millions of visitors every year. Visit Britain wants to raise the morale of Britain people to make their holiday in other parts of UK. The idea for opening offices all over the world to spread description pertaining to Britain is excellent. The holiday packages organised by Visit Britain takes into account all the major holiday spots in London; whereas the company also decides to make partnership with ideal hotels and airlines those are liked by visitors so as to build good network. The company has decided to prepare new package for the New Visit Britain trip which will be priced in such away to undercut the existing suppliers in market. The price will address the perception issues pertaining to expensive travelling to UK. The price will also enhance the interest of the visitors to visit UK and thus increase the demand and help UK to achieve the desired visit numbers.
Identification of 3 potential strategic options for Visit Britain
The three potential strategic options for Visit Britain to launch its business in UK and worldwide are as follows:
1) Make extensive advertisements in media and in outdoor hoarding so as to attract the attention of people easily. Apart from that it should also give advertisement in social networks so that the information pertaining to the company and its packages are well distributed among the internet users.
2) Make campaigns in every country so as to give a view of Britain as well as Visit Britain to people so that they are interested to become their members.
3) Make a yearly package with the help of which people can make a number of trips to Britain accordingly to need.
Yearly holiday package in UK
The best strategy is the yearly holiday package for the members of Visit Britain as they will be able to spend quality time in their favourite places of the world without bearing any extra cost every time as they will have to make onetime payment at the beginning of year.
Recommendation for marketing mix
The 4 P’s of marketing mix of Visit Britain are adequate enough for the success of the company. However, few things can be added to the available strategies so as o enhance the probability of success. As for example Visit Britain can arrange lucky draw offers which will add goodwill to its brand as people will urge for many more lucky draw offers.
Reference list
Gooroochurn, N. And Sugiyarto, G., 2005. Competitiveness indicators in the travel and tourism industry. Tourism Economics, 11(1), pp. 25-43.
Key Note Limited, 2006. Travel & Tourism Market Review 2006. [online] Available at: < http://www.keynote.co.uk/market-intelligence/view/product/1822/travel-%26-tourism-market/chapter/4/pest-analysis > [Accessed 20 August 2014].
Miller, G., 2001. Corporate responsibility in the UK tourism industry. Tourism Management, 22(6), pp. 589-598.
PwC, 2014. Travel and Tourism. [online] Available at: < http://www.pwc.co.uk/hospitality-leisure/issues/travel-and-tourism.jhtml > [Accessed 20 August 2014].
VisitBritain, 2014. Business Planning. [online] Available at: < http://www.visitbritain.org/opportunitiesadvice/advice/planning/ > [Accessed 20 August 2014].
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