Vouchers for Baby-Boomers: Tourism Market Research

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Table of Contents

Introduction
Capabilities and Environment
Segmentation
Differentiation
4Ps
Works Cited

Introduction

In the field of tourism and leisure, focusing on a single niche for too long is not a wise choice. In that regard, differentiating offers can be seen as one of the options. Offering only a single type of vacation packages is too limited, considering the different needs existing in the market. There are many opportunities in the vacation business, utilizing which at the right time can be an opportunity in itself to differentiate the services offered. One of such opportunities can be seen through luxury vacation packages to retiring baby-boomers. The present report will address the considerations that should be made in terms of supporting the marketing initiative of targeting such group.

Capabilities and Environment

After conducting a SWOT analysis, the objectives and the resources that the company has to achieve might become apparent (see Table 1).

Strengths	Weaknesses
Existing marketing capabilities (research and focus groups). Expertise in tourism Existing customer-base. Partners (hotels, airlines, etc.)	Lack of knowledge about luxury vacations Focusing the company’s resources on a single category
Opportunities	Threats
The largest population segment in the US (Lamb, Hair and McDaniel 97). Such population is coming of age. Many baby-boomers consider the age over 50 as a start of new life. The income of baby-boomers grows. 23 percent of all baby-boomers have the highest income, confident and living well. Existing customers are potentially the children of the new potential customer, i.e., baby-boomers.	The competition might increase in such niche with the entry of major players in the tourism business. The existence of cheaper alternatives in the market of luxury vacations. The need for sensitive advertisements. The leisure market in decline (Mintel Group).

Looking at the SWOT analysis, it can be stated that the opportunity of diversification can be seen as the most attractive, considering that the market in which the company operates is fairly known (Perreault and McCarthy). It can be stated that leveraging the company’s strengths, such as expertise, customer-base, partners, etc, it not only can utilize the opportunities in the environment, but also eliminate the weaknesses in the company. Considering the fact that at the present time, baby- boomers have just started retirement, with the oldest being 64 of age, there is still a market opportunity in the younger generation of baby-boomers, i.e., 47 and more. In that regard, the objectives can be seen in targeting such group and getting an early start in such target market.

Segmentation

There is sufficiently enough information on such target group as baby-boomers. In that regard, the focus can be narrowed down for such group. In general needs of the vacation market, can be seen through spending a particular time vacation time, for recreational, leisure, and or tourism purposes. They need a place to spend such time, a mean of transportation, a program of what to do, and accompanying conditions for comfort. The needs can be narrowed down to those who do not seek solutions, rather than all inclusive packages, from which the target age is narrowed down to those past the age of retirement.

The needs of such groups according to the group’s characteristics can be seen in the following (Perreault and McCarthy):

Longer vacations, more time to spend.
Higher income, more options and more expensive components of the package.
The program is focused on activities, i.e. expeditions and travels as opposed to laying on the beach vacations.
Healthy food.
Sports
No children

The geographical location of the customers and their travels is within the United States, with the recent financial crisis and the depreciation of the US dollar. The target group of those who might seek luxury packages can be characterized by such lifestyle characteristic as “Savvy Savers”, i.e. self-aware, suburban and cosmopolitan, and like to follow cultural and sporting events” (Lamb, Hair and McDaniel).

Differentiation

The positioning of the package will be made in accordance to its careful selection and luxury. As opposed to other packages which focus on kids and grandchildren vacations or cheap and affordable packages, the package in our company will be differentiated based on its premium class, all inclusive options, and satisfactions of all needs. Thus, the product promoted will be positioned as first class vacation. Baby boomers do not need to be reminded of their age and in that regard, the positioning of the product can be linked to such event as retirement as a new beginning, in which they can afford the highest quality.

4Ps

Product

The product is an all inclusive vacation package, combining recreational and comfortable leisure and active tours. The motto of the product can be stated as “You Deserve Luxury”. The package can be customized into the customers’ demands, in terms of changing location, the program, the transportation, etc. The remaining unchanged characteristic is the level of service. The appeal that should be used will satisfy the behavioral needs of customers, and thus, the main importance should be paid to the way the offer will be branded. A unified brand might be used to all the company’s offers.

Place

The distribution of the product can be seen through tour agents, and through the website of the company. The website, in that regard, can be used to directly purchase the package and/or request additional information. Additional, channels can be seen through sport and business, clubs, airline sales, etc. Baby Boomers represent nearly 40% of business travel, and thus, loyalty programs that can be redeemed for vacations (Mintel Group).

Promotion

The ads that can be used might be differentiated into two media types. On the one hand, internet and television, with an emphasis on the former, will be suitable medium for mass marketing ads. The target market is technologically oriented and thus, uses social networks as a communication medium. The second type of communication can be seen through word of mouth, where “[b]aby boomers are also heavily involved in word-of-mouth promotion” (Lamb, Hair and McDaniel 98). As one of channels, the current customers of inexpensive vacation packages can promote the offers to the parents which are supposed to be baby-boomers.

Price

The price of the package will be higher than that of competing products from other providers. The justification for the price can be seen through the emphasis on the service quality. Thus, the price will support and be supported by the rest of the Ps in the mix. Nevertheless, the price should be paid only for the components that will be actually used by customers. Thus, there will be no redundant components in the package.

Works Cited

Lamb, Charles W., Joseph F. Hair, and Carl D. McDaniel. Marketing. 10e. ed. Mason, Ohio: South-Western Cengage Learning, 2009. Print.

Mintel Group. “Baby Boomers and Vacation – Us – December 2010”. 2010. Mintel Group. Web.

Perreault, William D., and E. Jerome McCarthy. Basic Marketing : A Global-Managerial Approach. Mcgraw-Hill/Irwin Series in Marketing. 15th ed. Boston, Mass.: McGraw-Hill, 2005. Print.

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