Marketing Management

Dr. Shwekar Mostafa

Assignment #1

“TRAVO Case Study”

By:
Ashraf Abdel Rahman Abdel Hamid Seif el-
Nasr
G204 – Telecom Egypt
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In the very beginning we’re having a large travel group in the travel market which is TRAVO, this
group offers a range of holiday packages aimed at several parts of the market. With a massive package of
tour operations, a nationwide chain of travel shops and a fleet of aircraft.

At the same time there is a fast growing sector of the travel market in recent years which is the cruise
market. Once the domain of the privileged few, cruises are now available to a much wider target market
as costs have come down and incomes have risen.

And unfortunately till now, TRAVO company has not been part of this market. However, we still didn’t
lose the chance to enter this market strongly and hereunder our initial roadmap in order to penetrate this
market.

1- Latent Demand is the Key factor:

As we see that there is a latent demand in the market on the new travelling experience which was
limited in the past on the privileged domain of customers, now it became available to a much wider
target market as costs have come down and incomes have risen.

These new customers from the non-privilege segments are seeking to try the same travelling experience
which were exclusive on the privileged segment, which can satisfy some secrets needs related to them.

The availability of these two major elements which are the Desire to try new experience which were
limited on the privileged ones and the ability to pay and buy due to that cruise costs became cheaper in
cost and the rise in income of the customers created the latent demand which will be the key factor that
will enable us to penetrate this market.

2- Expected Growth Opportunity, IS IT !!

Currently we are considered as a cash cow in the line of aircrafts travelling with our nationwide chain
of travel shops and a fleet of aircraft, but in the new market we still a (question mark) which needs
large investment where we can depend on the cash cow line. one of the strategies that we can follow is
to acquire one of the successful existing small travelling companies (STAR) which are already
providing the cruise services to the middle-income groups to benefit from its current experience in this
field and at the same time invest more using our core competencies to increase the success and
together we can turn into a (cash cow) in cruise travel industry.

3- Targeted Market, who is our customer?

Our main focus will be on consumer market, and here we can benefit from our existing customer base in
the aircraft travelling, and at the same time we can expand our customer base through our nationwide
chain of travel shops to reach new targets of customers

Assignment #1 By: Ashraf A. Rahman A. Hamid seif El-Nasr Marketing Management Dr. Shwekar Mostafa
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At the same time, there is a great business market where we can make deals with variety of suppliers
which are mandatory for our business just like:

- Big brands in the food industry to be the main supplier on board of our ships
- Big brand in the beverages industry to be the main supplier on board of our ships
- Big brands in furniture and design to equip our ships and shops
- Big companies in the Oil industry to be our main oil supplier.
- Care services providers

4- What are our initial strengths and weaknesses (SWOT)?

From our initial study we can state that we have the following:

o S
 large travel group in the travel market
 Nationwide chain of travel shops
 Fleet of aircraft.
o W
 Lake of knowledge in the new cruise market
o O
 Trend to the new cruise market
 latent demand on the new cruise travelling
o T
 The other competitor’s in the same market with higher experience in this market

5- Our STP Concepts:

In the new market we can target and segment new and different types of customers based on different
criteria’s as the Cruise travelling market is already a highly segmented market, this segmentation can
be as follow:

- Demographic: Based on the Income level:

We can make customized different travelling packages based on the income level of the customers,
each of them has a different set of counties and harbors and level of services.

- Generation: Based on age:

A different travelling packages can be set based on the age of customers where we can have
customized cruises with relaxing accommodation and much comfortable services for the Saga type
holidays which is aimed at the over 50’s and designed to fill this group’s needs. On the other hand, we
can target Club Med and Club 18-30 with programs with extra activities like on board concerts or
travelling packages includes tickets to music concerts in the counties within the cruise.

- Based on Marital status

We can customize packages for the newly married ones or we can make special prices in anniversary
ceremonies of the customers and for singles we can offer low budget travelling experience.

Assignment #1 By: Ashraf A. Rahman A. Hamid seif El-Nasr Marketing Management Dr. Shwekar Mostafa
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The main focus should be to focus on satisfying the customers’ needs and here’s some
examples:

- For real needs:

We will avail different cruise packages to different destinations with different programs

- For unstated needs:

We will avail on the cruise board all the services that customer expect to find (Food,
Beverages, Medical, Care, Entertainment …)

- For delight needs:

We can give discount in customer’s special events, we can make music concerts on the cruise
board with famous singers, we can give free or discounted accommodations in the hotels or in
the restaurants in the countries within the tour. We can make application for our guests to send
any requests or complains 24/7 with immediate response.

- For secret needs:

We can play on the idea of serving the customer with a service which were limited to the
privileged customer only

6- Value and Brand Equity is not an Option:

Due to the current situation TRAVO company realizes that it has made a mistake by not entering
the cruise marketing earlier that’s why it plans to enter the market as soon as possible,

The new market should be the target of the whole company starting from CEO to the smallest
employee in the company, and in order to success in the new sector we should meet customers
preserved value. And this should be culture of the whole company.
In order to place this culture in employee’s minds, for example, we can put signs and billboards in
our shops to keep reminding our employees with our main target which should be the customer
delight.

We can build our Brand equity as follow:

- Brand Awareness:
We can use social media and our current nationwide travel shops of TRAVO to advertise our new
travelling service, also we can communicate our existing customers directly by sending SMS’s or
e-mails, we can use billboards inside our nationwide chain of travel shops and inside our aircraft
fleet.
- Brand associations:
Through advertising and the level of quality that we will provide to the customer which will create
our image and positioning
- Perceived Quality:

Assignment #1 By: Ashraf A. Rahman A. Hamid seif El-Nasr Marketing Management Dr. Shwekar Mostafa
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The new market should be the target of the whole company starting from CEO to the smallest
employee in the company, and in order to success in the new sector we should meet customers
preserved value. And this should be culture of the whole company.
- Brand Loyalty
Which we should maintain through the level of quality that we will give to our company
7- Competition:

We expect to face a strong competition in the new market as follow:

- Direct: Other companies in this market have been predominantly targeting the middle-income
groups and they are offering the same service and already have experience with the market

- Indirect: Other traveling sectors specially aircrafts

Core competency: In order to face this competition we should focus on our core competency that
we’re already a large known and trusted travel group in the travel market, and we already offer
range of offers and packages aimed at several parts of the market. With a massive package of tour
operations, a nationwide chain of travel shops and a fleet of aircraft.
This will give us the edge on the other competitors in the market. And will enable us to reach a
wide range of customers and we will benefit from the reputation that we already have among our
customers

at the same time, we should secure and enhance the level of quality that should satisfy the
customer preserved level of quality

one of the strategies that we can follow is to acquire one of the successful existing small
travelling companies (STAR) which are already providing the cruise services to the middle-
income groups to benefit from its current experience in this field and at the same time invest more
using our core competencies to increase the success, Later and to secure a long term growth we
can have an expansion plan to target the luxury end, with high prices and prestigious ships. Which
will be risky to start with it now without a good experience in this market.

8- Cannibalization:

One of the risks that we will face with the new market is cannibalization, which means that a part
of our existing aircrafts customers will leave it to the new cruise sector which will impact our
income from existing aircraft sector but this fact should be accepted otherwise we will lose this
profit to the other competitor’s.

9- Company orientation:

Applying the Holistic concept as follow will enable us to reach the main goal which is customer
satisfaction:

- Relationship Marketing

Assignment #1 By: Ashraf A. Rahman A. Hamid seif El-Nasr Marketing Management Dr. Shwekar Mostafa
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The company need to build mutually satisfying long-term relationships with the key constituents
in order to earn and retain their business. A marketing network consists of the company and its
supporting stakeholders

o Influence market: By making deals with influencers to make events on board of the
cruise or in social media and giving them free travels on our ships and use this as Ads for
the company
o Recruitment market: where we can get the qualified and experienced staff to run the
business we can make scholarships for the talented students to complete their education in
the related universities then after graduation they can have jobs in the company, also we
can give them training on the cruise board in the summer vacation
o Referral: we can pay for some of our loyal customer to add positive reviews on sites and
application like TripAdvisor and similar sites.
o Employees: by giving them the good salaries, training, pension programs, family
insurance, and always making sure that customer satisfaction is their main target
o Suppliers: we can make deals with our suppliers which are required for our business just
like:

 Food Suppliers
 Beverages Suppliers
 Oil Suppliers
 Care Services Suppliers
 Entertainment providers
o Customers: by building a long term relation with customer to keep knowing and studying
his preferences and follow and response to any change in it by:
 Analyzing the customer comments and feedback on our service
 Studying the market and the competitor
 Facilitate the communication channels between the customers and the company
(Mobile app, easy interface for the web site)

- Integrated Marketing

7 Ps 7Cs
Company Perspective Customer Perspective What we have to do
We should provide an excellence service and to
Product/Service Customer (needs/wants) offer the most up-to-date facilities with different
Programs
We should offer different pricing packages for our
different customer segments
Also to benefit from the nationwide travelling
Price Cost
shops to reduce the customer effort to reach us
And to avail app and web site for reservation
giving the full data about our programs
To benefit from the nationwide travelling shops
Place Convenience
also apps and website

Assignment #1 By: Ashraf A. Rahman A. Hamid seif El-Nasr Marketing Management Dr. Shwekar Mostafa
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We should make promotion plans for our

customers for example in their special dates
Promotion Communication
And this promos should be real with no hidden
fees
We should invest in our staff and keep training
People Competence/ Courtesy
them to enhance their capabilities
Our shops should be well designed with stylish
furniture with nice screens shows snaps from our
Physical Evidence Comfort/ Cleanliness travelling experience
Welcome drink should be offered
Ships should be well designed
Process should focus on customer needs first, with
Processes Coordination/ Continuity full automation and smooth flow which not
impacting the customer.

- Internal Marketing

Marketing functions (sales force, advertising, customer service, product management, &
marketing research) must work together.
Then other departments must adopt marketing, they must also be customer oriented.

- Performance marketing

Social Responsibility Marketing: We can give scholarships for talented students in the related
universities then recruit them in our company. sustained marketing efforts & customer equity
should be adopted by engaging in various developmental & environmental activities

10- The Proposed Value Chain

The value chain of our service should include:

Primary Activities:

- Inbound Logistics
o Contract with ships manufacturers
o Oil Suppliers
o Contracts with Harbors in the different countries
o Mobile Data Services Provides through satellites
o
- Operation
o Operating the ships to travel from location to another
o Concerts and other activities that should be held to attract customers
o

Assignment #1 By: Ashraf A. Rahman A. Hamid seif El-Nasr Marketing Management Dr. Shwekar Mostafa
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- Outbound Logistics
o Avail trips for the different destination that attract customers based on marketing study
o Review and rate the cruise and the service
o
- Marketing and sales
o Promotion in customer’s special occasions
- Services
o Deals with Car Delivery companies to deliver our customers from and to harbors.

Support Activities:

- Procurement
o
- Technology and development
o Advanced sailing and marine systems with the highest safety levels
- Human resources Management
o Well educated, Trained, Motivated staff
- Firm Infrastructure
o Good relation and communication with other departments in the company

11- Filling The Gap

- Intensive growth

Due to the current situation, we have the following strategies in order to fill and the gap that we
have.
o To offer our new cruise service for our existing Market
 Here as we mentioned we can convince our current customer base with our new
cruise service but again here we will have cannibalization problem with
percentage of our customer but of course it we be better to eat ourselves before
anyone else do.

o To offer the new cruise service for new Market

 Here in addition to our current market it’s recommended from our side to target
new segments of customers which are not covered currently based on the
demographic, Psychographic and behavioral factors

- Integrative growth
o Forward integration: we can integrate with:
 Hotels near by the harbors in the targeted countries
 Restaurants with different classes based on the travelling packages
 The local agencies for local tours in the targeted countries
 Car and Bus’s services providers in the targeted countries

o Backward Integration: we can integrate with:

 Oil Providers
 Food and beverages suppliers to offer their services on our ships

Assignment #1 By: Ashraf A. Rahman A. Hamid seif El-Nasr Marketing Management Dr. Shwekar Mostafa
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 Care services suppliers

 Entertainment providers

o Horizontal: we can integrate with:

 Integration with another existing cruise travelling company which already has
excellency and expertise in the cruise service market

12- Strategic Alliances is a strong Option

a. We can have alliance with variety of food and beverages providers (Starbucks,
McDonalds, KFC ….) to offer their services on our ships.
b. We can have alliances with the Hotels and restaurants in the in tour harbors to give
discounts to our customers

Assignment #1 By: Ashraf A. Rahman A. Hamid seif El-Nasr Marketing Management Dr. Shwekar Mostafa