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Overview of the Hospitality Industry

Question:

Discuss about the Marketing Management for Hospitality Industry.

Hospitality industry entails the business of providing catering, lodging, and entertainment services to customers to satisfy their needs and wants with the main aim of obtaining profits (MacInnis, 2012). This industry is supported by the foundation of strong primary principles, backed by tourism – generating infrastructure since hospitality is the key virtue for any industry to attain its set goals and objectives.

Hoteliers need to focus on the consumer decision - making models to acquire all the information pertaining the consumers' complaints and recommendations and thus come up with suitable resolutions that will enable them to retain their existing customers as well as encouraging the potential ones to enter the industry. Marketing strategies by hotels should be set with the main aim of matching the desires of their customers, as obtained from the analysis of the models (Tseng & Hung, 2014). Consumer decision – making model, consists the analysis of how users identify their needs, gather information, assess possibilities and finally conclude to a buying decision. The choices consumers make towards different products can be driven by economic, environmental or psychological factors.

With reference from the hospitality industry in Australia, there are five stages involved in consumer decision-making process which starts before the actual purchase of goods and services is done, they include: need recognition, information search, and evaluation of alternatives, purchase decision and purchase evaluation.

In the case where the consumers often make more purchases, the process repeats itself since a satisfied customer will always come again and again. Although consumers are the key decision makers, due to the inability to predict the future regarding costs and also obtaining information in the present, their choices are limited such that they can only be ‘bounded rationally.

Consumers are motivated to purchase products from the same supplier if they were previously satisfied with the same goods and services. Need or desire is the primary driving force or motivation factor behind every consumption. All consumers share common need structures, but distinct specific wants differentiate them according to their cultural, social and economic perceptions. Customers automatically make their purchases from the marketer or seller who represents the figures and values according to their expectations, provides the requirements and the experience needed by the consumer and finally availing the goods and services which most attract the customers. Hoteliers need to always examine and evaluate their customer views before bringing anything new to the market.

Different participants influence the decision making of a consumer when purchasing a good. They are known as the decision-making units. They include the initiator, user, influencer, decider, approvers, and purchasers. The buyer may not necessarily be the user of the commodity, for example, in the case where a child (initiator) needs to buy a chocolate and is accompanied by his father and mother, he will first tell the mother (influencer) who will transmit it to the father (decider) who may decline or approve the request and purchase the chocolate. Hoteliers must be in a position to identify who their customers are so as to adequately maintain and retain them as well as encouraging the potential ones in their business venture. Consumers make purchasing decisions from observing several aspects in the market (Al-Tarawneh, 2012). They first behave differently after purchasing goods and services, and this is known as the ‘consumer post-purchase behavior.' Customers will automatically form certain expectations for a product, just immediately after purchasing it and before the actual consumption. They still evaluate it during and after actual use and the results, reality, and perceptions acquired from these evaluations act as the determinant factors which highly depend on whether to purchase the product again or not.

Consumer Decision-Making Models

Influences from the external environments may also affect the decisions consumers arrive at before purchasing the products. These controls help to give manipulations to the way different users conclude to their investment decisions. They include; group influences which may involve family and friends, product class influences involving the upper, middle, working and lower classes, and finally the situational influences. For marketers to acquire maximum customers possible, they need to put into account an analysis of marketing decisions focusing on different consumer dimensions.

After the marketers fully analyze the consumer decision-making model, they are now left with the obligation to carry out market segmentation to reach their customers from different geographic areas appropriately. This entails the division of a market into small units which have similar characteristics within each of the segment and different characteristics between layers, and it involves four different variables namely; geographical, demographic, socio – economic and behavioral variables. Requirements for effective segmentation include the substantiality, durability, actionability, differentiability, measurability and accessibility of the market segment. In the side of marketers, proper market segmentation helps them to avoid unprofitable markets, abstain from competitive markets and also enables them to utilize the readily available resources adequately (Abbasi, Bigham, & Sarencheh, 2011). It also helps in gaining the ability to get a clear understanding of a particular market and improved future consumer behavior predictions. An example of market segmentation in Australia where the favored destinations with the best experiences are Kakadu, Arnhem Land, the Olgas, the Kimberleys, Noosa, Port Douglas and the Flinders Ranges.

Consumers behave differently to different markets as it only matters with how the marketers present their adverts to them, and the level of persuasion the consumers get from the marketers. There are four types of organizational markets which always have high impacts and influence of the decisions made by the consumers towards the purchase of particular products. One of them is the producer market which involves the purchase of goods with the aim of transforming them into finished goods, the reseller markets buy to resell specifically to get profits, for instance supermarkets. The third one is the government market which involves buying goods that are used to serve the public. Foe instances, road construction and finally, the institutional markets which require non – governmental organizations which purchase goods for charity purposes such as the World Vision Program.

Consumers' decisions are accompanied by various risks. It mostly depends on how hazardous users see objects, their perceptions, attitudes and the ability and willingness to tolerate the risk. One of the major risks is that one cannot first get the taste of a good or experience the comfort of a service before the actual purchase (Zhang, Ji, Wang, & Chen, 2016). Risk perceptions are defined as an evaluated association of three likelihoods which include; winning, losing and receiving nothing. Risk perceptions can be addressed in two different forms, the first one being the multidimensional view where a consumer will fear to purchase an individual product due to lack of detailed knowledge pertaining it.

Stages of Consumer Decision-Making Process

For instance, a customer will hardly be convinced enough to buy a product they have never used before. Here comes the duty of the marketer who should make sure that the consumer is entirely confident that the product is good and of no harm to them. The second form is that of examining the perceived readiness of a risk in monetary grounds (Carroll & Guzmán, 2013). Financial impacts will always have greater losses that the profits. Risk judgment thus becomes something of great importance when it comes to matters concerning decision making.

Most of the consumers, for instance from Australia use information delivered from the internet which in some case brings challenges to marketers (Tarrell, et al., 2013). Bearing in mind that organizations depend on the information and analysis they obtain from consumer decision making models; marketers make use of integrated marketing communications (IMC), which is defined as a plan of techniques and approaches through which enterprises do executions by fascinating, working for, and undertaking communications with consumers and other parties (Kordnejad, 2014). In the case of advertisements and direct involvements with the media for publicity purposes, most of the marketers opt for online promotions to capture a greater number of audience and influence their experiences and perceptions since the world has already changed to a digital era.

Hoteliers acquire full knowledge of their business strengths and weaknesses from their customer views, remarks, and feedbacks. They also get a chance to master the sections where they need to improve as well as noticing where they have done excellently. Proper satisfaction with services, however, is determined by consumer's experience. The quality of the service can only be assessed after the actual consumption is made (Opitz, Krüp, & Kolbe, 2014)). For the case of hotels, the customer only gets a full assessment of the service e.g.  The infrastructure was given, sanitation of the rooms and the hospitality of the workers only after checking in. Excellent marketing communication by hoteliers creates images and insights into the service experience, in the mind of a potential consumer even before physically experiencing the services. Inability by a firm to perform its duties well results to the poor satisfaction of the customers, and the possible outcome from the consumers includes negative word of mouth, customers switch to another place where their needs and wants are fully taken care of.

Consideration of the consumer decision-making models significantly increases the functions and characters undertaken by the marketers in the process of service marketing, noting that a good customer management is a very vital principle of service marketing (Tseng & Hung, 2014). Consumer decision-making model doesn’t only help marketers in consumer evaluation but helps the consumers also in their succeeding characteristics and the way they act. For instance, in Australia, most of the records of hotel complaints were seen to relate to the issues associated with the employees in hotels and the status of the physical facilities.

In conclusion, the consumer decision-making model analysis is the determinant factor of any firm that wishes to run operations smoothly as well as fully satisfying customers. Business managers need to recognize their roles and obligations to study and fully analyze what their customers need to get satisfied. Both existing and potential customers should be well recognized and given the priority so as to enable them to stick to one point which best attends their needs and wants. Well served customers will spread a good word of mouth and also act as an advertisement tool for the organization.

References

Abbasi, P., Bigham, B. S., & Sarencheh, S. (2011). Good’s history and trust in electronic commerce. Procedia Computer Science, 3, 827-832.

Al-Tarawneh, H. A. (2012). The main factors beyond decision making.Journal of Management Research, 4(1).

Carroll, D., & Guzmán, I. (2013). The new omnichannel approach to serving customers. Accenture. com.

Kordnejad, B. (2014). Intermodal Transport Cost Model and Intermodal Distribution in Urban Freight. Procedia-Social and Behavioral Sciences, 125, 358-372.

MacInnis, D. J. (2012). “Brands as intentional agents”: Questions and extensions. Journal of Consumer Psychology, 22(2), 195-198.

Opitz, N., Krüp, H., & Kolbe, L. M. (2014). Environmentally Sustainable Business Process Management-Developing a Green BPM Readiness Model. In PACIS (p. 12).

Oladepo, O. I., & Abimbola, O. S. (2015). The influence of brand image and promotional mix on consumer buying decision a study of beverage consumers in Lagos State, Nigeria. British Journal of Marketing Studies,3(4), 97-109.

Tarrell, A., Tahmasbi, N., Kocsis, D., Tripathi, A., Pedersen, J., Xiong, J., ... & de Vreede, G. J. (2013). Crowdsourcing: A snapshot of published research.

Tseng, S. C., & Hung, S. W. (2014). A strategic decision-making model considering the social costs of carbon dioxide emissions for sustainable supply chain management. Journal of environmental management, 133, 315-322.

 Zhang, H. Y., Ji, P., Wang, J. Q., & Chen, X. H. (2016). A neutrosophic normal cloud and its application in decision-making. Cognitive Computation,8(4), 649-669.

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