Lectures notes 26.1-16.3.2007

LESSON 26.1.2007

Tourism development=the government provides funding for development (infrastructure development)

Master plan=plans for creating new fields for tourism in different regions, it is not possible to set up a hotel just anywhere without a master plan (environmental research and so on)

The government encourages businesses by lower taxes and so on

Exporting services; the tourist brings the money themselves

Image affects pricing

Air traffic

• 10 million people in the air all the time
• Mostly Northern Atlantic and inside Europe and North America but also China is increasing
• An African flies an average of 40 km in his/her life, while Europeans fly 40 000 km
• Airlines now enterprises, in the past national carriers
• There is regulation of market areas, can not be too big
• 100 million tourists travel yearly to the Northern Mediterranean

• Tourism market is increasing all the time - richer people go to poorer countries
• The biggest nation is slums and the second biggest is tourists (every 7^th person)
• Money goes where the biggest interest is-->price products to get money-->according to interestàthe more interest, the higher the price
• Home market=inside market (US got everything; mountains, beaches, casinos…)
• But biggest business-->tourism=foreign money
• Brazilians no. 1 goers to US
• Governmental regulations (free access, visas…fingerprints to US)

LESSON 2.2.2007

Product pricing based on market economy

• Before -91 no market economy in Soviet Union, cheap to travel to exotic places (promotion)
• North Korea nowadays the same

Cuba-->Spanish investors

Companies always have strategic planning on the market

• The art of war-->long-haul plans-->master plans for <10 yrs
  

Business idea

• To make money but how (e.g. McDonald’s idea to be the biggest hamburger chain, service as efficiently as possible)

Business plan/product placement on the market (what products to place)

• Product placement always has an impact on the price
• For example, Ferrari=for the few and the rich, no intention or need to sell many
• Other may concentrate on cheap as business idea based on that
• Products, images, values

Different markets

• Finland—democratic buying culture, no one has luxury thingsàgoes for travel as well
• Russia---big spenders, dress well, eat wellàalso travel in style

Values---->nature friendly, free trade…Christmas, people buy because of values, many things influence

Companies invest to stock markets-->want more money-->in stead of putting money in the bank, people invest in the stocks

History of price and money--->Security didn’t matter when price was low

Margin=profit

LESSON 16.3.2007

FAM trip= familiarization trip

• a travel professional invited by the promoters to get to know the destination
• they want to get the money out of the finnish market
• also negoating with airline, airline is paying for flights in business class

CRM=Customer Relationship Management

• The company knows their customers already and prices for loyal customers are different than on the market in general

Important to understand the cost of distribution