Report On Auckland, New Zealand Marketing Mix And Market Segmentation

Marketing mix

The marketing mix of Auckland consists of various elements that form the core of the country’s marketing strategy. Its aim is to achieve the objective of the company. It looks at the price promotion, product partnership and place (Borden, 1965)

Price

In any business, the customers’ perception of the value is a very important determinant of the price of the product since customers draw mental pictures on what the product’s price should be. In most instances, a product is much more than a physical thing as it also involves psychological elements. Apparently if a product has a low price tag customers might assume that it is of low quality. Pricing in tourism is very complex since the prices must contain the three components. Pricing may depend on the geographic location of the place or the seasonality of time. Auckland uses two pricing strategies namely, discount pricing strategy and tactical pricing strategy. In discount pricing strategy, they offer their customers seasonal or periodic discounts so as to attract as many customers as possible. On the other hand, tactical pricing strategy is targeted at the airlines (Larry, Alison & Neelu, 2012). 

Promotion

The promotion aspect of marketing covers all types of promotions. For instance, it involves advertisements done through the main media channels such as the radio, T.V among others. Others promotions by businesses may include sales promotions, sales display, direct mails, and loyalty schemes. In tourism, the product can only be experienced. Besides, the elements that make a complete tourism product are entertainment, accommodation, and transportation. Auckland uses travel agents, airline companies, and online bookings to promote its products. According to Burtler (1980), some of the packaging that they offer customers includes free transportations, holiday packages and reduced entrance fee to major attractions, entertainment and guide services to their customers. These promotions are aimed at attracting and maintaining customers. For instance, if a customer can be offered a free transport and a reduced accommodation fee, he is likely to come back for tourism activities.

Product

Auckland New Zealand has put a lot of emphasis on the products that customers want. For them to establish what these customers like, they conduct market research. This is because customers’ requirements often change over time hence the need to be up to date. The main centers in Auckland include Auckland City which is the largest urban areas in Auckland New Zealand, The Great Barrier which is a large highland with small population and Pukeho, which is which is a major attraction that has motor racing and a garden of fresh vegetables. Furthermore, Waiheke Highland is famous for its many vineyards that attract most tourists and Mount Soufriere- which is a volcanic highland that erupted more than 600 years back. Its other main attractions include casinos, spars, farms, volcanoes and beaches that can be accessed by customers (Burtler, 1980).

The above map shows the Distance between the Great Barrier and Auckland

Partnership
Dibb and Simkin (1996) explain that, a partnership is a way through which an organization uses the partnership to market their products jointly. Product managers will modify the products and packages to be marketed so as to attract many customers. Through the partnership, Auckland New Zealand is using relation marketing in marketing their products. For instance, they build, maintain and enhance long-term relationships with customers’ suppliers and travel agencies. These include local businesses (hotels and restaurants) and partnership with airlines. If this is done, they believe that their products will now sell well.

Place

This involves the physical place of the product but rather to a range of processes that the product passes through that that it can reach the end customer. In this, Auckland New Zealand can use direct or indirect distribution to ensure that the product reaches the final customers. Indirect distribution channel the product comes from the producer direct to the consumer while in indirect it can pass several process such as first, producer-retailer-consumers, second, producer-wholesaler-retailer-consumer, and finally, producer- agent-wholesaler-retailer –consumers (Dibb & Simkin, 1996)

The above chart shows different channels of distributions.

Market segmentation
Geographic segmentation
Domestic Tourism contributes close to $12.5 billion in terms of revenue to the country. All this accounts for more than 57% of the total amount of income brought about by the tourism industry. Many tourism places rely on the patronage of local tourists to visit these places. This market is very important because of the uncertainty of the key international markets. The marketing strategy is that if New Zealand can provide good facilities for domestic tourists, they will be better placed to attract and retain international tourists. According to recent survey, the target market is the South East Asia where many clients are likely to come from in future. This is because over the next 15 years there will be an increase in the number of customers whose tastes will change as they try to catch up with the living standards of Western countries. According to Coughlan (2001), South East Asia will have exploded to represent the world’s biggest middle class. In fact, it has been predicted that its growth will rival some western countries. Aging is of focus since as people grow older their lives are less stressful hence they have a chance to rediscover themselves. This involves spending time with people that they care about. Besides, South East Asia is a market that has not been fully exploited hence it has a huge potential.

The above figure shows economic crossover of west to east

The above graph shows how middle-class population is likely to change in future by region
The above graphs the visitors’ arrivals by key markets in the year ended march 2013. The graph clearly shows that the focus has been on South East Asia

Psychographic factors

The reason tourists from Auckland flock international markets have been attributed to psychographic factors such values, attitudes, interests, and general lifestyles. Moreover, an individual’s personality is also reflected in the things that they own and use in the form of technology. For instance, those who own holiday homes are more likely to take short holiday breaks. Moreover, those who are connected to their peers are also likely to frequent domestic short break places. This segmentation divides customers according to their values. Marketers apply personality market variables to market their products.
In New Zealand there is a relationship between past time and the frequency of domestic breaks for instance, those who value canoeing as the best past time takes more than the average number of times an average user takes in any single year. On the contrary, those with an interest in diving takes 60% fewer short domestic breaks than the average New Zealander. Moreover, those who consider cultural activities as the best past time takes 200% longer domestic holidays in a year than the average new Zealand. There is also a strong relationship between the use of technology, property Ownership and domestic holidays (Pickton & Broderick, 2005). 

The above graph shows the trend of Chinas Visitors to New Zealand

Behavioral markets segmentation
This is based on the customers’ attitude towards the use of products that are available in the market. Coughlan (2001) explains that, behavioral such as occasions, usage rate, buyer readiness and royalty issue are very crucial as the best starting points. For instance, occasions are when the customers are rated according to the best time of the year that that they are likely to go for a holiday. For example, in New Zealand many customers are luckily to go for tours during holidays such as Christmas, Easter, and summer. During this time, tourism sector targets very many customers.

Benefits markets segmentation

Benefits divide customers based on the different benefits that they seek from a particular product. These include the kind of people that look for each benefit and the companies that deliver such kinds of benefits to them.

Demographic market segmentation

According to Larry, Alison, & Neelu (2012), in Auckland, New Zealand the target markets is in relation to age, gender, family size, occupation, education, religion, and nationality who are the young adults, well educated and middle-class people. This is because they are more likely to take holiday trips than the old people. Besides, some of the products that are on offer during holidays in places such as casinos, spars, leisure packs better suit the young than the old. In addition, old people are less likely to go for viewing mountain climbing beach activities.
The above statistics shows the numbers of young middle age groups who are visiting the New Zealand are more than the old.

The above graph shows that consumption is moving towards Japan, Asia, India and China middle class

The above chart shows different divisions of tourism

References

Borden, N. H. (1965). The Concept of the Marketing Mix. Journal of Marketing, 34(1), 43-56.
Burtler, R. W. (1980). The Concept of a Tourist Area Cycle of Evolution: Implications for Management of Resources. Canadian Geographer-geographe Canadien, 23(1), 1-30.
Coughlan, A. T. (2001). Marketing channels. Upper Saddle River, NJ: Prentice Hall.
Dibb, S., & Simkin, L. (1996). The market segmentation workbook: Target marketing for marketing managers. London: Routledge.
Larry Dwyer, Alison Gill, Neelu Seetaram. (2012). Handbook of Research Methods in Tourism. Qualitative and Quantitative Methods. Edward Elgar Publishing.
Pickton, D., & Broderick, A. (2005). Integrated marketing communications. Harlow: Prentice Hall.