Executive Summary
Mark Warner is a holiday operator specialising in providing a range of luxury holidays for consumers willing to spend more money than the average family. Mark Warner currently need a new strategy to make money in the tough economic climate, which is the basis for the report. The proposed solution is for Mark Warner to introduce short-break holidays, lasting of no more than 3 days, in selected resorts as a trial-run. There is clearly a market for short-breaks, now more than ever in the recession, as it is reported people would rather go on a short holiday than on none at all. Mark Warner would differentiate from existing competitors by providing their excellent childcare services with the short-break holiday package.
This new package seems feasible, since Mark Warner have the existing capacity to accommodate the demand for short-breaks, where resorts would have otherwise been left empty. Thus, Mark Warner are saving money by fully utilising their available resources. If the package is successful, it will be implemented in all their resorts, not just their Greece summer holidays and France winter holiday resorts, and then across the segmented market of short-breaks for single parents. Should the package fail, Mark Warner would not incur drastic losses, and there are alternatives in which they can expand into, such as partnering with luxury holiday operators in the UK and offering their services in partnership.
1.0 Introduction
Mark Warner currently is in the travel and tourism industry promoting luxury, premium priced holiday packages. The marketing plan outlined within this report will outline a brief overview of the current climate of the travel and tourism industry and current trends of consumer behaviour. From research undertaken and displayed within report the authors will examine future product developments to help Mark Warner enhance productivity, raise awareness and branch into popular new markets which are currently in demand.
1.1 Travel Industry
The UK Travel and Tourism industry is divided into three market segmentations; UK residents travelling within the UK, UK residents travelling abroad and non UK residents travelling to the UK. The total expenditure of these three markets amounted to �72.67bn (Keynote b (2008)).
1.2 Current Economic Climate
The current economic climate has had a negative impact upon the travel and tourism industry within the UK. The price of Oil encouraged the decline of income within the travel and tourism industry. High oil prices led airfares to increase in price; this at a time when consumer disposable income had decreased rapidly. Many airlines and holiday companies went into liquidation in 2008 due to the impact the global recession was having on the travel and tourism industry. To add further negativity within the UK the Sterling dramatically decreased in value whilst the Euro continued to increase. This had a negative impact on holiday makers due to consumers who travelled within Europe no longer benefiting from such a profitable exchange rate as previous times had enabled them to do so. Although all may seem bleak for the travel and tourism industry; research has led the authors of this report to conclude that consumers will continue to travel due to everyday stress that life/work can bring although are changing purchasing habits (Tobin, R, (2009), Yesawich, P, Hse.gov (2007), Mintel (2006) and Keynote (a) (2008), Rural Economy (2009)).
1.3 Buyer Behaviour
The current economic climate has encouraged consumers to ‘bargain hunt’ thus meaning get the best price for their money. Consumers have to change their buyer behaviour in order to still maintain their annual holiday in which research has proven to release the stress from day to day living. Due to the decrease in consumer disposable income shoppers are either staying within the UK or taking shorter breaks within Europe; they continue to travel never the less; thus meaning the travel trade will need to adjust to reflect demographic and social changes. Many influences can affect buyer behaviour; these include culture, sociological, economical and individual psychological factors. To determine Mark Warners target market buyer behaviour the report will look into specific target demographic (Travel Weekly (2009), Thinkbox (2008), HSE.gov (2007), Statistics.gov (2008), Chisnall (1992)).
1.4 Mark Warner’s Target Demographic
Mark Warner’s target demographic is marketed at ABC1 demographic professionals who seek active holidays and possess a larger disposable income than that of other classifications. Current cultural behaviour within the ABC1 demographic indicates that ‘greener living’, ‘fair trade’ and ‘healthy living’ are all attributes taken into account when purchasing a product. Sociological factors include housing, the majority of ABC1 owning their own seven plus bedroomed, detached family home consisting of predominantly couples with and without children; the families usually are educated with a degree or equivalent. The individual psychological factors predominantly associated within this demographic is their healthy, active lifestyles; interests include skiing and many other outdoor activities.
Popular holiday destinations are usually within Europe via bookings made on-line. The target demographic is prepared to pay slightly more to avoid the ‘Chav culture’ of other demographics which can be perceived by certain consumers within the ABC1 demographic as tainting the value of the product. This is when a branded product is reduced in value due to it becoming easily accessible; supply often exceeding demand. Within the holiday industry this is usually heavily perceived tourist attractions; these are often also cheaper than non perceived holiday destinations and seen as not so exclusive (Acorn (2008) and Chisnall (1992)).
1.5 Mark Warner
Mark Warner is in the niche market for premium priced luxury holiday packages. Mark Warner currently caters for couples and singles who wish to enjoy a child free holiday or family holidays which offer child care facilities. The holidays offered involve many activities for the consumers to participate within which encourages the consumer to place this company as an activity based, luxury, package holiday company. Mark Warner relies on its excellent record of receiving 75% of its overall sales being repeat business. Due to the exclusivity, this enables their products to be premium priced, they do not wish to compete with the likes of Thomas Cook Group PLC or TUI Travel PLC as this would devalue their product, a key competitor would be Sunsail; due to this they do not possess high street stores and wish to advertise exclusively to chosen target market thus meaning there is high reliance on word of mouth, exclusivity being a successful attribute Mark Warner has acquired.
An unsuccessful attribute for Mark Warner is their flexibility. When booking a holiday with Mark Warner duration is either seven or fourteen days and there is no option for short-breaks or the common professional option of a ten day stay (Mark Warner, Sunsail, Thomas Cook Group PLC, TUI Travel PLC, national statistics (2008), Travel Weekly (2009), demographics classification (2004), Keynote a (2007), The ABC Consumer (2006), Short Breaks (2004)).
1.6 Mark Warner’s Current Consumer Awareness
Mark Warner are currently perceived by consumers who are aware of their brand as a premium priced, activity based company who promote packaged holidays to families, singles, couples and single parent families with a large disposable income. Brand awareness outside of their target market is low profile due to them trying to portray the exclusivity which enables them to premium price their packaged holidays (Mark Warner, Joules (2009), refer to questionnaire undertaken within initial report and demographic classifications (2004)).
2.0 Popular holiday destinations
The most popular holiday destinations are within Europe; as stated by the National Statistics and Acorn from 2004-2008. Acorns research shows that 48% of the UK population choose to travel within Europe for their holidays, further research states that Mark Warner’s chosen demographic also opts to spend their packaged holidays within Europe. The National Statistics state that in 2008 23,404 UK residents visited Europe in comparison to the remainder 13,119 visiting other continents. The number of consumers travelling to Turkey rose 56% from 2002-2006, also in 2006 France received 77 million arrivals of consumers, Spain 59 million, Italy 37 million and Germany 22 million (Keynotes – Travel and Tourism).
At present Mark Warner caters for the demand within Europe by providing package holidays in locations such as Corsica, Greece and Portugal. The current economic climate has shown that consumers are also opting to vocation within the UK due to a decrease in disposable income; this is examined in further depth within the sub heading ‘The UK Holiday Market’ (Mark Warner, National Statistics (2008) and Acorn (2004) and Keynotes).
2.1 Domestic Tourism in the UK
According to the Key Note a (2008) the UK domestic travel and tourism market was worth �1.24bn in 2007- a 1.3% increase in comparison with 2006.
2003
2004*
2005
2006
2007
Expenditure� (�m)
26,482
26,778
22,667
20,965
21,238
% change year-on year
–
1.1
-15.4
-7.5
1.3
Trips (000)
151,00
148,00
138,700
126,300
123,500
%change
Year-on-year
–
-2.0
-6.3
-8.9
-2.2
Bed nights (million)
490.5
480.7
442.2
400.1
394.4
%change
Year-on-year
–
-2.0
-8.0
-9.5
-1.4
*Key Note estimate
exludes day trips
Source: United Kingdom Tourism Survey, sponsored by the UK Tourist Boards/Key Note
As table above shows number of trips has fallen, but what is encouraging that the rate of decline in these two measures in lower in 2006 and 2007 than 2005 and 2006. But as stated in Key Note a (2008) the average expenditure per trip was �171.97 in 2007, compared with �165.99 in 2006, while average expenditure per bed night was �53.85 in 2007, up from around �52.40 in 2006.
There were a number of threats, which UK domestic travel and tourism sector faced in 2008, the main was economical crisis, but according to Jamieson (2009) recession and falling value of the pound change travellers habits. As stated in study the number of Britons planning on holiday in the UK risen by 15% since October 2008, the research also shows that the fall in the value of sterling against the dollar and the euro will also make breaks in the UK more attractive that US and Europe.
2.2 Popular Duration of Over-Night Stay
In the 1990’s Short-breaks were the leading sectors within the travel and tourism market. Short-breaks continue to be of popular demand within the market among all consumers, not just because of the economic climate. The ABC1 target demographic portray attributes of having a large disposable income, they are motivated professional and often wish to travel on shorter trips as they are reluctant to be away from their profession for extended periods of time. Other popular durations consist of seven, ten and fourteen night stays; Mark Warner currently only cater for seven and fourteen night stays and do not seem to have any flexibility within their durations to enable them to cater for the demand in the market of short-breaks; even though this demand is within their target market (Mark Warner, Keynotes (2004), National Statistics (2008), Civil Aviation Authority (2005) and Mintel (2006).
2.3 Demand for childcare/single parent families
Single status is becoming the ‘norm’ of today’s society. The breakdown of marriages are on the increase and there is a dramatic rise in single parent families. The travel market is still predominantly undeveloped for single parent families and there is currently a rising demand in the market for this product. This enables Mark Warner to be in a market dominating position as it already caters for child care facilities; by adapting these to fit with single parent families Mark Warner has the potential to penetrate this undeveloped market (National Statistics (2008), Keynotes (2007)).
2.4 Current Strengths
Mark Warner has successfully managed to promote their holiday packages within the luxury travel and tourism market enabling them to charge premium prices on their products. Mark Warner currently offer professional childcare facilities within chosen holiday resorts and cater for a variety of activities within a variety of holiday destinations. They are currently exploiting the market within European destinations which are stated as being the most popular holiday locations. Mark Warner also reaps the benefit from their 75% repeat purchase from current customers; thus providing them with an excellent reputation.
2.5 Current Weaknesses
Mark Warner currently has high internal costs and has been receiving a negative deficit. They have high staff costs which need to be adjusted and experience limited advertising reach due to budget. The economic climate has had an impact on the travel industry as a whole and spare capacity within the hotels and planes is costly for the company. In 2007 Mark Warner received negative press for their childcare facilities due to Madeline McCann going missing whilst on a Mark Warner holiday package in Praia da Luz on the Portuguese Algarve. Mark Warner also lacks flexibility within the duration of stay available; these are limited to seven or fourteen day trips (Mark Warner and typicallySpanish (2007)).
2.6 Current Opportunities
Mark Warner has many opportunities to enhance productivity, brand awareness and penetrate existing markets. There is the demand for a niche market in package holidays for single parent families which offer childcare facilities. Mark Warner currently caters for singles and provides childcare facilities; by combining the two they could comfortably penetrate into this market with little expense. Mark Warner can also look into penetrating the market with short-breaks both in Europe and within the UK. Short-breaks is also in demand within their target demographic by offering short-breaks in Europe Mark Warner could utilise unused capacity within their current hotels and flights to raise revenue. Mark Warner could link with forums who target audience matches their criteria and advertise special breaks for the single parent families to help promote brand awareness.
2.7 Current Threats
The current economic climate is a current and ongoing threat to the travel industry. A decrease in consumer disposable income is forcing the travel industry to change their strategic plan as shoppers are becoming increasingly more concerned within the economic climate; thus encouraging them to save rather than spend. This is changing consumers’ buyer behaviour and forcing the travel industry to adapt accordingly; often leading to price wars. This could be a large threat to Mark Warner due to their premium priced holiday packages being unable to compete within the price wars due to their perceptive exclusivity. If Mark Warner reduces prices to a level which would encourage alternative demographics to become consumers they may lose their premium prestige and this possibly would taint their brand image and devalue their product.
2.8 Ansoff Matrix
Existing Products New Products
Existing
Markets
New
Markets
3.0 Potential Product Innovation within Europe
From analysing research and consumer’s answers to questionnaires in the previous report, it would be ideal and beneficial for Mark Warner to start offering short-breaks to consumers. There is an evident demand and a gap in the market for short-breaks (which also offer childcare facilities), domestically and abroad, with a report from VisitBritain stating they have been rising since 2001, and expected to rise despite the current global recession. In 2003, UK residents took 45.9 million trips abroad of 1-3 nights in length (www.tourismtrade.org.uk). For many, frequent short-breaks are replacing the longer weekly/fortnightly holidays, in an attempt to save money for families who are not willing to spend thousands on a full price holiday (www. ezinearticles.com). People are determined to keep their holidays and are prepared to give up other luxuries, such as gym memberships and dining-out, instead of their holidays, and would rather go on a short-break rather than none at all. This trend has been shown by research conducted by Hotel.com, a leading hotel booking site, which reported than ‘nano-breaks’ (single-night holidays) had a 29% increase from the previous year, where travellers travelled out late Fridays and returned on Sunday (www.hotels.co.uk).
Many consumers are searching for holidays within the Eurozone to get more value for money, since the pound is gaining relative strength against the Euro, which is beneficial for Mark Warner as many of their resorts are currently within the Eurozone, such as their Greece resorts, Portugal resorts, Corsica resorts and their Sardinia resorts, making them more appealing for customer’s to visit. If these resorts included short-break packages, demand for Mark Warner holidays might increase as they would have a unique product by offering childcare services with their short-breaks (www.telegraph.co.uk, www.markwarner.co.uk).
The short-break holiday package would also extend to Mark Warner’s ski resorts, which is their most popular holiday destinations, as they provide excellent sport activities and have won numerous awards for them. Research supports the fact that ski-weekends have been on the rise for last decade, giving incentive for Mark Warner to enter the market. EasyJet has claimed that there is a recent surge of Britons who are choosing to cut their winter breaks short, rather than none at all, in favour of the best snow and skiing conditions available in recent years. The majority of customers who tend to go on ski-weekend breaks are described as ‘cash rich, time poor’ professionals, Mark Warner’s ideal clients. While it can be argued that the short ski-weekend market is flooded with competition, with tour operators offering competitive prices and activities, such as Neilson or Skiline, Mark Warner would be in its own niche as they will offer luxury ski-weekends with childcare services, something which other competitors do not offer in as high-quality as Mark Warner (Mintel (2006), www.easyjet.com)
Currently, Mark Warner only offers holidays which are 1 or 2 weeks. The prospects of Mark Warner introducing short-breaks in their resorts are very appealing as there is a potentially untapped market for the holidays, in which their resorts are located. Most of Mark Warner’s competitors, such as Neilson and Sunsail also only offer 1 or 2 week holidays, and so Mark Warner would have relatively less competition. The demand for short-breaks is increasing and now, with the value of the pound slowly strengthening, Mark Warner could benefit from introducing this new holiday package.
From the above research, it has been suggested that Mark Warner try to create a new holiday package to attract more customers and increase revenue. The holiday package suggested would be short-breaks, consisting of 2-4 days, which offer the normal Mark Warner holiday facilities such as flights and transfers, accommodation, half board breakfast and dinner, sports tuition and childcare. Since most of Mark Warner’s customers use their services for their quality childcare facilities, it would make sense for Mark Warner to also include the childcare facilities in their short-break holiday packages, as there are not many holiday operators who offer this kind of service with a short-break holiday.
The short-breaks will help Mark Warner fill capacity in their resorts where rooms are empty, thereby fully utilising them and helping them save money by cutting costs, as otherwise they would have been left empty, and help gain much needed revenue. The following marketing mix shows how Mark Warner should implement the potential holiday package.
3.1 Product
The product being offered is a new short-break holiday package. As a trial-run, to see if it will be successful and avoid losing money by implementing it in all the resorts if it is a failure, the package will only be available in Mark Warner’s San Agostino beach resort in Greece and the Courcheval 1850 ski resort in France, due to their popularity among customers. Should the package be successful, it will be implemented in all Mark Warner’s beach and ski resorts. Mark Warner is commended on their childcare facilities, which they pride themselves on by claiming their quality service is their best asset, so it will be included in the package for their short-break holidays.
3.2 SUMMER HOLIDAYS
Currently, in the San Agostino beach resort in Greece Mark Warner’s summer holiday package includes: flights and transfers, accommodation, half-board which comprises your breakfast and evening meals, a range of sport activities such as sailing, windsurfing, water-sports, tennis and scuba diving, and childcare clubs. Some activity courses and childcare incur extra costs. All of these factors will be included in the short-break holiday package. Accommodation is provided in either a hotel or garden bungalows. Mark Warner has partnered with Viking Airlines to charter flights from Gatwick, Manchester and Birmingham Airport. The summer holiday season is from May to October.
3.3 WINTER HOLIDAYS
The winter ski holidays are said to be Mark Warner’s most successful holiday package, having won the Silver British Travel Award in 2008 for Best Activity/Sport Holiday Operator. Mark Warner offers skiing and snowboarding as their holiday activities, and offers customers the option to hire equipment such as skis, snowboards, helmets and boots, at additional costs. Winter holiday packages include: flights and transfers, accommodation, welcome drinks and canap�s, breakfast, afternoon tea, 3-course evening meal with wine, ski hosting and list pass collection service. Activity courses and childcare again also have additional costs. All of these factors will be included in the short-break holiday package, in the resort of Courcheval 1850 ski resort in France. Accommodation is provided in a chalethotel. Mark Warner has partnered with Viking Airlines to charter flights from Heathrow, Manchester, Birmingham and Edinburgh, each with additional costs. The winter holiday season is from December to April.
Since not everyone will want all the options Mark Warner offer, Mark Warner should develop a check-list where customers choose the options they want and disregard the ones they do not want. This will help cut costs for Mark Warner, and make the packages more flexible for the consumer.
3.4 Price
Mark Warner is associated with luxury and so their prices for the services they offer are quite expensive, compared to competitors. The prices of the short-break holidays are proposed in relation to the prices of the existing holidays offered. For a 3 night stay at the San Agostino beach resort in Greece, the cheapest fare would start in May and cost an average of �289, per person and range to �790 during peak season. For a 3 night stay at the Courcheval 1850 ski resort in France, the cheapest fare would start in the beginning of December and cost an average of �400 per person, and range to �840 during peak season. Prices for all holidays increase during peak seasons, and the new package would be no exception. The prices of the holiday package are calculated from Mark Warner’s average existing prices for the summer and winter holiday packages.
3.5 Place/Distribution
Mark Warner is not a high-street tour operator, so you cannot go see representatives and book a holiday in person. Instead they have a telephone based sales team, where you talk to the professional sales persons on the phone and book a holiday. The sales department have very flexible hours, from Monday-Thursday 9am to 8pm, Friday from 9am to 6pm, giving people who work during the day an opportunity to call and book their holiday in the evening. They are even open on the weekends, on Saturday from 9am to 5pm and Sunday from 10am to 3pm. Alternatively, Mark Warner now also allows online booking, making it more convenient and easy for people to book and research their holiday online.
3.6 Promotion
Mark Warner has claimed that 75% of their holidays are sold through repeat bookings and through recommendations, on which they are clearly dependent on. To make the new package known to existing customers, Mark Warner can send out promotional emails to their customers to make them aware of the new holiday package and also include a supplement poster advertising the package when they send their annual brochure to their existing customers. Word of mouth recommendations can then spread, which cannot yet be quantifiable, but would be expected to reach numerous amounts of people, if the package is a success.
Mark Warner can gain countless customers if it markets and advertises itself effectively. Currently, Mark Warner’s main medium of advertising is through its website, www.markwarner.co.uk, so it would be beneficial to them to advertise their new package on the home-page where all visitors will be able to see it, with a link to direct them to more information should they need it. To successfully advertise the new package it is recommended that Mark Warner display a bold banner-like advertisement at the top or the left-hand side of the web-page, where research has shown it to be the first place people looking when opening a website, since they read from top-to-bottom and from left-to-right (www.ezinearticles.com).
Mark Warner advertises in the Sunday Times in the Travel section. They have an advertisement in the bottom left corner, which takes roughly a fifth of the page. This would be a good opportunity to advertise their new package.
They also have brochures for their summer and winter holidays which can only be ordered online from their website, and is usually delivered by post with 3 working days. The new holiday package can be added to the new summer and winter 2010/11 brochures, consisting of no more than 4 pages.
With the increased use of the World Wide Web, many people turn to the Internet to find out information on goods and services. For the holiday and travel industry, blogs, user reviews and online social networking sites are becoming increasingly popular to review services with previous customers. Consumers are able to access valuable unbiased information on the company from previous customers. Research from the Y-Partnership’s 2008 National Leisure Travel Monitor Survey has shown that more than 6 out of 10 leisure travellers use the Internet to obtain information and prices. The report also showed that more than a quarter of consumers seeking travel information on the Internet visited a blog to review information on a travel supplier’s services (www.ypartnership.com). With the Internet and mediums such as blogging and forums, Mark Warner can target its ideal customers and advertise on websites where they engage, for example, Mark would benefit from advertising on forums such as ‘mumsnet.com’, which is a forum for women discussing anything from holidays to politics, as it caters to their ideal demographic.
The preparations for designing the new advertisements, brochure pages and web pages should start as soon as possible, for a launching period in the beginning of July. This means that the summer short-break packages will be trialled out first in Greece. The timing should work to Mark Warner’s advantage as it will be peak summer season and demand will be quite high. Since many other holiday operators have been cutting capacity this year to save money (TUI travel, the biggest European tour-operator cut capacity by 16% in the beginning of 2009), Mark Warner will be adding capacity and demand adequate demand should be expected (www.timesonline.co.uk).
3.7 Cost
The cost for Mark Warner to produce this package should not be much, as they are only filling capacity in their resorts, which would have otherwise been left empty, since they have a contract when leasing out the hotels. The same number of staff will be employed, and will be working the same hours, so their wages should not have to increase, saving the company money since most firm’s biggest cost are their staffs’ wages. They might have to charter more flights if demand increases, which would increase their costs. However, Mark Warner can command a discount from Viking Airlines as they will save them money as they will have to pay for less airport stand-by space as they will spend more time in the air rather than the airports’ runways. To charter an average flight it will cost:
Flight charges
9,120
Overnight fees
900
Landing fees
�150
International fees
�750
Catering
300
Total Cost
11,220
(source: www.chiefexecair.com) (Above table is only an indication)
It is assumed that Mark Warner have a contract with Viking Airways to charter flights in bulk for cheaper, so the cost should not dramatically increase. The calculations above are based from a New York to the Bahamas flight, so it is also assumed that flights within Europe have less international fees, and should be slightly cheaper. It is likely that Mark Warner may not have to charter more flights, but rather fill to capacity their existing flights, thereby saving costs.
The area where money will be going out is advertising the new package and familiarising it to customers. For this to happen, an advertising campaign is needed. Since Mark Warner already have an auto-generated promotional email going out to previous and existing customers, they can add their new holiday package to the email, which can easily be done by the IT department during their working hours, with no extra cost.
Thinking and creating a suitable advertisement to promote the new holiday package would rely on the marketing department and then costs will be attributed to printing it and adding it to the website, which is again the IT department’s role, and adding it to the brochure. Applying the advertisement onto the website is fairly straight-forward and would only cost an average of �15 per hour, per webpage, and calculated under staff wages.
The printing in the brochures may incur extra costs, but can be discounted if purchased in bulk. To print 10,000 copies a standard size 100 page brochure, printing and design companies can charge up to �8000, including tax (www.brochuredesignservice.com). These however, do not need to be printed until the following year.
If the package is successful, it will be implemented in all their resorts. The short breaks will also contribute more profit to the company as hotels will be filled. As more people choose to take shorter holidays on order to save money, there are more hotels that stand half empty as Mark Warner struggles to fill them. By booking the rooms for four days instead of a week, allows the company to make more money and not waste it on hotel leases that they cannot fill. Should the package fail, Mark Warner would not incur drastic losses.
4.0 Potential new product launch
As a part of strategy Mark Warner will collect data for 12-18 months for short breaks to look at its popularity, profitability and customer satisfaction. After that time there will be meeting of the executives required to make decision on the project. Once the figures are promising there will be a possibility of continuing the idea and adapt it with more resorts.
Once that idea is successful the company should have additional money, which could be use on further expenditure of company and its resources.
Mark Warner is aiming to provide active holidays for whole family. Researches decided to look for a potential partner, which organises active short breaks in the UK. Both companies could possibly promote each other and cooperate by awarding their customers with discounts for another one as a company offering similar product.
As a result of the research HF Holiday (http://www.hfholidays.co.uk/familyholidays/) could be a potential partner. They offer great short breaks with outdoor activities and adventure for all family in the UK. They also offer outside the UK breaks, but I would not be an area covered in their partnership. The HF takes to what Britain has got the best-countryside. Family can spend days outdoor on walking, cycling and multi-activity adventures. Fun for toddlers and relax for parents during weekends and short breaks out of town.
Mark Warner also has its own range of holidays for singles and couples only. To also satisfy needs of these customers company could possibly start its partnership with Holiday in Britain (http://www.holidayinbritain.com/default.aspx) or Off Peak Luxury (http://www.offpeakluxury.com). Both companies offer luxurious breaks in many, very beautiful parts of the UK. They can take to some of the finest romantic hotels, luxury country hotels and boutique townhouses. That gives a quick run away from the town for a weekend or couple days to relax and rest.
The proposal is aiming to keep attract new customers by the trust in companies Mark Warner could partner with, but also offer returning customers alternative for short breaks in the UK within the same standards and qualities.
4.1 Marketing/Advertising Plan
Mark Warner’s current advertising campaign is narrowed to weekly advertising in The Sunday Times, partnership with Pru Health-award winning insurance company, which provides cover for active people, rewarding and supporting healthy life style. Depending on type of insurance Pru Health customers can use their up to 40% discount on Mark Warner holidays. The company also started to offer discounts for Joules Clothing customers-families with disposable income, who are willing to spend more money on outdoor clothing. The Joules Magazine for summer 2009 (apart from clothing) recommends events around the UK worth attending this summer as well as 20% off Mark Warner Holidays.
As mentioned earlier the target market for Mark Warner is professional families and couples, who expect real experience from holidays. According to BBC news (2007) single parenting numbers increase and there is a demand for single parents holiday. Because these numbers are rising there are more and more single parent networks, where people discuss their every day problems and struggles as well as look for a support. There also people talk about different products on the market, give opinions and recommendations.
The examples of single parent networks could be: www.mumsnet.com, www.mumszone.co.uk, www.singleparentsnetwork.com, www.singleparentsonline.net. They are all aiming to gather single parents into societies, where people can feel free talk about every day parenting challenges.
All these networks give bigger power to word of mouth and sharing information. After careful research Mumsnet and Mumszone seem to have very similar target market to Mark Warner. Either networks or one of them could potentially be a place, where Mark Warner could get new audience and build more brand awareness.
Both networks have product reviews and forums, where people (mainly mums) discuss books, beauty products and holidays. Mumszone for example, has it forum in all areas including Travel & Holidays, where people discuss operators, quality of holidays and activities provided for adults as well as for children. That could be a good opportunity, where Mark Warner could get more PR. Obviously, such a forum can contain good and bad reviews, but Mark Warner should monitor them and make sure their image is portrayed as they wish or defend and explain themselves.
There is also possibility of advertising on such a websites, on Mumsnet for example usually is a small advert on the right hand side of company offering holidays or breaks for a family and a discount for members of networks. That could possibly work for MW, when someone will read good opinion they may be interested in looking at the company and what they offer.
As a part of advertising campaign MW could also organize ‘theme weeks’ for network members as ‘mums get together’ meet for a first time in real life (not virtually) and go for holiday. There is potential to organize activities and time specific for single parents associated with all what is in their range of interest. That could be an opportunity to fill hotels, as it potentially would be organized in quiet periods, which also gives chance to offer attractive price.
4.2 Smart
Specific: To introduce new short haul holiday destination within Europe.
Measurable: Would be measured as a percentage of sales. Number of holidays sold and at what cost
Achievable: Introducing short haul holiday using existing capacities in Mark Warners own resort
Realistic: Due to the current economic climate, people would still take holidays but might not be spending as much as they previously did. Existing staff members would also be used for the launch and promotion of short haul holiday at no extra cost.
Timed: This would be reviewed within the first 12 months period
4.3 Cost
Mark Warner would be advertising on websites like mumsnet.com and mumszone.co.uk. they cost of placing adverts on them are between �150 and �200 per month and the total cost for placing 1 years advert on both sites would be between �4800 and �5000. The short haul holiday would also be advertised on Mark Warners brochures at no added cost to the company. Mark Warner is currently making losees and they have an employee of 577 which compared to competitors and very high and they have the highest staff to profit ratio among their competitors e.g. SunSail 289 emploess and �3,921,400 turnover 2008, Neilson holidays 398 employess and �7,917,400 turnover for 2008. Due to the current economic climate, staff numbers would be cut and the savings made from here would be invested in the promotion of the new short haul holiday. The cost of the promotion would depend on the media use. To promote the new short haul holidays, Mark Warner would be advertising on mumsnet.com and mumszone.co.uk as those using this website are their potential customer.
4.4 Budget
The budget for the online advertising promotion on 2 website would be �5000 per annum. A contingency sum of �15,000 would be allocated if the need arise to widen our target audience by advertising on more websites. Since Mark Warner would be filling vacant spaces at its resorts and utilising its staff members, cost are going to be kept at the minimum.
4.5 Revenue
In the last 10 years, Mark Warner made an average loss of �-103,000. By introducing cheaper short haul holiday, the profit would add towards its balance sheet. Mark Warner already has a 70% repeat business from its customers and the new short haul holiday would also be marketed at them. The average cost of a holiday is �300 per person and this would be marketed to Mark Warners existing customers and new customers in conjunction with other companies. To stimulate repeat purchases, frequent user incentives would be introduced generating revenue. For year 2008, the turnover was �46,281,000. �32,396,700 of the turnover is attributed to repeat business. It is estimated 20% of turnover of the new short holiday would be gotten from existing customer totalling �6,479,340. Mark Warner sold over 46,000 holidays in year 2007 and it is estimated that the short haul would do a quarter of that totalling 12,000 at �300 per person making revenue of �3,600,000. Total revenue for the first year is estimated at �10,079,340.
5.0 Marketing Plan
Appendix 1 shows year 1 of Mark Warners Short-break Advertising/Marketing plan. Costs are not shown within this plan and are researched and explained further under the sub heading ‘Costing’, although this does state that an annual budget of �15,000 has been allocated for this project. Due to low budget main advertising of sample product will take form with partnership companies and promotion will be aimed at current customers, this will insure costs are kept to a minimum. The launch of the sample short-break product is expected to launch at the end of July 2009 during the summer holidays which is a popular time for travel. The economic climate is also dominating decisions within the market place and making the short-break product within the travel and tourism industry an appealing option. The end of August researchers will undertake post product launch research; thus informing Mark Warner of the profitability of the short-break market and which have been the most successful advertising channels used.
6.0 What if scenario…
- What if short breaks with Mark Warner will not be profitable?
Stop offer short breaks and re-think the strategy. Focus on the sales of main holiday packages.
- What if partnership with HF Holidays will not bring any extra revenue?
Organize a meeting with HF representatives and re-think the advertising campaign. Look for different areas where you can advertise and share costs. Look for potential expenditure of family activities and/or introduce child care within HF Holiday destinations in the UK. If no improvements in results-terminate partnership.
- What if partnership with Off Peak Luxury and/or Holiday in Britain will not be profitable?
Meeting with partner’s representatives, look for ways to advertise to the potential customers and share the costs. Look at research on specific demographic interests and most visited websites and product, which they are buying. No success-termination of the partnership.
- What if advertising campaign on single parent networks will not be successful and/or single parents will not be interested in offers by MW for network members?
Run the questionnaire between network members to find out the reasons. Re-think the strategy according to the results. Look for alternative forums, where could possibly advertise. When not successful-terminate online advertising campaign on single parent networks.
7.0 Conclusion
From the research undertaken it is clear that there are certain markets where Mark Warner can profit in. Introducing short-break holidays with childcare in their resorts is the most practical solution for Mark Warner to make a profit without incurring multiple costs, as they will just be filling to capacity, and catering to the demand in the market. It would start on a trail run basis in two resorts, and monitored over three years, and if successful will be implemented throughout all their resorts. The revenue sourced from this project can lead on to Mark Warner entering the UK market and partnering with companies such as HF Holidays and offpeakluxury.com to provide their service to their target demographic. If however, the projects are not successful, Mark Warner should dissolve any contracts made with partnering companies, on the basis of incurring losses, and rescind their short-break package holiday.
