Marketing forHospitality andTourismPhilip Kotler John T. Bowen Seyhmus BalogluContributions by Cristian MorosanA01 KOTL9844 08 SE FM.indd 1EIGHTH EDITION15/07/19 8:10 PM

Vice President, Portfolio Management: Andrew GilfillannPortfolio Manager: Pamela ChirlsEditorial Assistant: Lara DimmickProduct Marketing Manager: Heather TaylorDirector, Digital Studio and Content Production: Brian HylandsManaging Producer: Cynthia ZonneveldContent Producer: Rinki KaurManager, Rights Management: Johanna BurkeManufacturing Buyer: Deidra HeadleeFull-Service Management and Composition: Integra SoftwareServices, Ltd.Full-Service Project Manager: RammohanKrishnamurthyCover Design: Studio MontageCover Photo: LSC Communications, Inc.Cover Printer: Phoenix Color/HagerstownText Font: Melior Com 9/11Copyright 2021, 2017, 2014 by Pearson Education, Inc. 221 River Street, Hoboken, NJ 07030. All rights reserved.Manufactured in the United States of America. This publication is protected by Copyright, and permission should be obtainedfrom the publisher prior to any prohibited reproduction, storage in a retrieval system, or transmission in any form or by anymeans, electronic, mechanical, photocopying, recording, or likewise. For information regarding permissions, request forms,and the appropriate contacts within the Pearson Education Global Rights and Permissions department, please visit of third-party content appear on the appropriate page within the text.PEARSON and ALWAYS LEARNING are exclusive trademarks owned by Pearson Education, Inc. or its affiliates in the U.S.and/or other countries.Unless otherwise indicated herein, any third-party trademarks, logos, or icons that may appear in this work are the property oftheir respective owners, and any references to third party trademarks, logos, icons, or other trade dress are for demonstrativeor descriptive purposes only. Such references are not intended to imply any sponsorship, endorsement, authorization, or promotion of Pearson’s products by the owners of such marks, or any relationship between the owner and Pearson Education, Inc.,authors, licensees, or distributors.Library of Congress Cataloging-in-Publication DataNames: Kotler, Philip, author.Title: Marketing for hospitality and tourism / Philip Kotler, John T. Bowen,Seyhmus Baloglu.Description: Eighth edition. Hoboken : Pearson, [2019] Includesbibliographical references and index.Identifiers: LCCN 2019014463 ISBN 9780135209844 ISBN 0135209846Subjects: LCSH: Hospitality industry—Marketing. Tourism—Marketing.Classification: LCC TX911.3.M3 K68 2019 DDC 338.4/791068—dc23 LC record available ntCodeISBN 10:0-13-520984-6ISBN 13: 978-0-13-520984-4SVE ISBN 10:0-13-520987-0SVE ISBN 13:    978-01-3520987-5A01 KOTL9844 08 SE FM.indd 215/07/19 8:10 PM

This book is dedicated to Nancy, my wife and best friend, with love.P. K.With love to my wife, Toni, and children, Casey and Kelly.A special recognition and thank you to my friend and colleague, JimMakens, who coauthored the previous seven editions of the book. Weappreciate his contributions to the past editions, many of which liveon in this edition.J. T. B.To my wife, Zerrin, and our two sons, Derin and Deniz, with love.S. B.A01 KOTL9844 08 SE FM.indd 315/07/19 8:10 PM

BRIEF CONTENTSPARTIDefining Hospitality and Tourism Marketing andthe Marketing Process 11. Creating Customer Value and EngagementThrough Marketing for Hospitality andTourism 32. Services Marketing Concepts Applied toMarketing for Hospitality and Tourism 343. Marketing Strategy: Partnering to Build CustomerEngagement, Value, and Relationships 57PARTIIUnderstanding the Marketplace andCustomer Value 854. Analyzing the Marketing Environment875. Managing Customer Information to GainCustomer Insights 1166. Consumer Markets and Consumer BuyingBehavior 1567. Organizational Buyer Behavior1828. Customer-Driven Marketing Strategy: CreatingValue for Target Customers 204PARTIII DesigningCustomer Value-Driven Strategyand Mix 2339. Designing and Managing Products and Brands:Building Customer Value 23510. Internal Marketing27211. Pricing: Understanding and Capturing CustomerValue 29612. Distribution Channels Delivering CustomerValue 331ivA01 KOTL9844 08 SE FM.indd 415/07/19 8:10 PM

Brief Contents  v13. Engaging Customers and Communicating CustomerValue and Advertising 35814. Promoting Products: Public Relations and SalesPromotions 39515. Professional Sales42216. Direct, Online, Social Media, and MobileMarketing 459PARTIV Managing Hospitality and Tourism Marketing17. Destination Marketing49318. Next Year’s Marketing PlanA01 KOTL9844 08 SE FM.indd 549153615/07/19 8:10 PM

CONTENTSTo the Student xiiiPrefacexviiAbout the Authors xxPART1I Defining Hospitalityand Tourism Marketingand the MarketingProcess 1Creating Customer Value andEngagement Through Marketing forHospitality and Tourism 3YOUR PASSPORT TO SUCCESS 5CUSTOMER ORIENTATION 6WHAT IS HOSPITALITY AND TOURISMMARKETING? 7MARKETING IN THE HOSPITALITY AND TRAVELINDUSTRIES 8Importance of Marketing 8Tourism Marketing 8Definition of Marketing 9MARKETING HIGHLIGHT 1.1 HOW FOUR SEASONS HOTELS AND RESORTSDELIGHTS ITS CUSTOMERS 9The Marketing Process 10UNDERSTANDING THE MARKETPLACE ANDCUSTOMER NEEDS 10Customer Needs, Wants, and Demands 10Market Offerings: Tangible Products, Services,and Experiences 12Customer Value and Satisfaction 12Exchanges and Relationships 13Markets 13DESIGNING CUSTOMER VALUE-DRIVEN MARKETINGSTRATEGY 13Selecting Customers to Serve 14Marketing Management Orientations 14PREPARING AN INTEGRATED MARKETING PLANAND PROGRAM 16MANAGING CUSTOMER RELATIONSHIPS ANDCAPTURING VALUE 16Customer Relationship Management 17Customer Engagement and Today’s Digital andSocial Media 19Partner Relationship Management 20CAPTURING VALUE FROM CUSTOMERS20Customer Loyalty and Retention 21Growing Share of Customer 21Building Customer Equity 21THE CHANGING MARKETING LANDSCAPE23The Digital Age: Online, Social Media, andMobile Marketing 23Sustainable Marketing—the Call for MoreEnvironmental and Social Responsibility 24Rapid Globalization 25Co-Creation 25The Sharing Economy 26WELCOME TO MARKETING: YOUR PASSPORT TOBECOMING A SUCCESSFUL MANAGER 27CHAPTER REVIEW 28IN-CLASS GROUP EXERCISES 30EXPERIENTIAL EXERCISES 31REFERENCES 312Services Marketing ConceptsApplied to Marketing forHospitality and Tourism 34THE SERVICE CULTURE36CHARACTERISTICS OF SERVICE MARKETING36Intangibility 36Tangible Evidence 37Inseparability 38Variability 38Perishability 40THE SERVICE PROFIT CHAIN40MANAGEMENT STRATEGIES FOR SERVICEBUSINESSES 41Managing Service Differentiation 41Managing Service Quality 42MARKETING HIGHLIGHT 2.1 JETBLUE, SOUTHWEST, AND CIRQUE DU SOLEILPROVIDE THREE EXAMPLES OF SERVICE DIFFERENTIATION 43Managing Service Productivity 44Resolving Customer Complaints 44MARKETING HIGHLIGHT 2.2 RECOMMENDATIONS FOR IMPROVING SERVICEQUALITY 45Managing Employees as Part of the Product 46Managing Perceived Risk 47Managing Capacity and Demand 48CHAPTER REVIEW 53IN-CLASS GROUP EXERCISES 54EXPERIENTIAL EXERCISES 54REFERENCES 54viA01 KOTL9844 08 SE FM.indd 615/07/19 8:10 PM

Contents  vii3Marketing Strategy: Partnering toBuild Customer Engagement, Value,and Relationships 57NATURE OF HIGH-PERFORMANCE BUSINESS59Stakeholders 59Processes 60Resources 60Organization 60CORPORATE STRATEGIC PLANNING: DEFININGMARKETING’S ROLE 61Defining the Corporate Mission 62Setting Company Objectives and Goals 64Designing the Business Portfolio 64MARKETING HIGHLIGHT 3.1 ACCORHOTELS GROUP: MARRIAGE WITHONEFINESTAY, A LUXURY VACATION RENTAL PLATFORM 66PLANNING MARKETING: PARTNERING TO BUILDCUSTOMER RELATIONSHIPS 68Partnering with Other Company Departments 68Partnering with Others in the MarketingSystem 69MARKETING STRATEGY AND THEMARKETING MIX 69MANAGING THE MARKETING EFFORT72Marketing Analysis 72Goal Formulation 75Marketing Planning 76Implementation 77Feedback and Control 77A01 KOTL9844 08 SE FM.indd 7Demographic Environment 97The Changing American Family 102Economic Environment 103Natural Environment 104Technological Environment 105Political Environment 106Cultural Environment 107RESPONDING TO THE MARKETING ENVIRONMENT 109Environmental Scanning 109CHAPTER REVIEW 110IN-CLASS GROUP ACTIVITIES 112EXPERIENTIAL EXERCISES 112REFERENCES 1125Managing Customer Information toGain Customer Insights 116Marketing Information and Today’s “BigData” 119Managing Marketing Information 120MARKETING RESEARCH Understanding theMarketplace andCustomer Value 85Analyzing the MarketingEnvironment 87The Company 89Existing Competitors 90Suppliers 91Marketing Intermediaries 92Customers 94Publics 94MARKETING HIGHLIGHT 4.1 VISIT INDY—DESTINATION DIGITAL MARKETING 96120Assessing Information Needs 120Developing Marketing Information 121IITHE COMPANY’S ENVIRONMENTTHE MICROENVIRONMENT 899595THE MARKETING INFORMATION SYSTEMMEASURING AND MANAGING RETURN ONMARKETING INVESTMENT 77CHAPTER REVIEW 78IN-CLASS GROUP ACTIVITIES 80EXPERIENTIAL EXERCISES 80REFERENCES 814CompetitorsMARKETING INFORMATION AND CUSTOMERINSIGHTS 118Customer Value-Driven Marketing Strategy 70Developing an Integrated Marketing Mix 71PARTTHE COMPANY’S MACROENVIRONMENT89129Defining the Problem and ResearchObjectives 130Developing the Research Plan 131MARKETING HIGHLIGHT 5.1 ETHNOGRAPHIC RESEARCH: WATCHING WHATCONSUMERS REALLY DO 134MARKETING HIGHLIGHT 5.2 ZMET: GETTING INTO THE HEADS OFCONSUMER 138MARKETING HIGHLIGHT 5.3 PROS AND CONS OF ONLINE RESEARCH 140MARKETING HIGHLIGHT 5.4 A “QUESTIONABLE” QUESTIONNAIRE 142Implementing the Research Plan 146Interpreting and Reporting the Findings 146MARKETING HIGHLIGHT 5.5 RESEARCH PROBLEM AREAS 147MARKETING HIGHLIGHT 5.6 HSMAI’S KNOWLEDGE CENTER: A GREAT SOURCE OFMARKETING INFORMATION 148INTERNATIONAL MARKETING RESEARCH 149MARKETING RESEARCH IN SMALLERORGANIZATIONS 150CHAPTER REVIEW 150IN-CLASS GROUP ACTIVITIES 152EXPERIENTIAL EXERCISES 152REFERENCES 1536Consumer Markets and ConsumerBuying Behavior 156A MODEL OF CONSUMER BEHAVIOR 157PERSONAL CHARACTERISTICS AFFECTING CONSUMERBEHAVIOR 15815/07/19 8:10 PM

viii  ContentsCultural Factors 158Social Factors 161MARKETING HIGHLIGHT 6.1 TAPPING SOCIAL MEDIA MOMS AS BRANDAMBASSADORS 164Personal Factors 166Psychological Factors 169MARKETING HIGHLIGHT 6.2 SENSORY MARKETING—A POWERFUL TOOL FORHOSPITALITY BUSINESSES 170THE BUYER DECISION PROCESS 173Need Recognition 173Information Search 174Evaluation of Alternatives 174Purchase Decision 175Postpurchase Behavior 175MARKETING HIGHLIGHT 6.3 UNIQUE ASPECTS OF HOSPITALITY AND TRAVELCONSUMERS 176CHAPTER REVIEW 177IN-CLASS GROUP EXERCISES 178EXPERIENTIAL EXERCISE 179REFERENCES 1797Segmentation of Group Markets by Purpose of theMeeting 198Restaurants as a Meeting Venue 199DEALING WITH MEETING PLANNERSCHAPTER REVIEW 200IN-CLASS GROUP EXERCISES 201EXPERIENTIAL EXERCISE 202REFERENCES 2028199Customer-Driven MarketingStrategy: Creating Value for TargetCustomers 204MARKETS 206MARKET SEGMENTATION206Geographic Segmentation 207Demographic Segmentation 208MARKETING HIGHLIGHT 8.1 TARGETING FAMILIES BY TARGETING KIDS209Psychographic Segmentation 211MARKETING HIGHLIGHT 8.2 W HOTELS: A LIFESTYLE HOTEL 212Behavioral Segmentation 213Organizational BuyerBehavior 182THE ORGANIZATIONAL BUYING PROCESSMARKETING HIGHLIGHT 8.3 DUNKIN’ DONUTS: TARGETING THE AVERAGE JOE 214Using Multiple Segmentation Bases 215Requirements for Effective Segmentation 216184Business Markets 184Market Structure and Demand 184Nature of the Buying Unit 185Types of Decisions and the Decision Process 185PARTICIPANTS IN THE ORGANIZATIONAL BUYINGPROCESS 185MAJOR INFLUENCES ON ORGANIZATIONALBUYERS 187ORGANIZATIONAL BUYING DECISIONS 1881. Problem Recognition 1882. General Need Description 1883. Product Specification 1884. Supplier Search 1895. Proposal Solicitations 1896. Supplier Selection 1897. Order-Routine Specification 189MARKET TARGETING217Evaluating Market Segments 217Selecting Market Segments 218Choosing a Market-Coverage Strategy 220MARKET POSITIONING221Positioning Strategies 221Choosing and Implementing a PositioningStrategy 222Differentiating Competitive Advantages 222Choosing the Right Competitive Advantages 225Selecting an Overall Positioning Strategy 226Communicating and Delivering the ChosenPosition 226Positioning Measurement: PerceptualMapping 227MARKETING HIGHLIGHT 7.1 CORPORATE PROCUREMENT’S INVOLVEMENT INPURCHASING MEETINGS 190CHAPTER REVIEW 228IN-CLASS GROUP ACTIVITIES 230EXPERIENTIAL EXERCISE 230REFERENCES 2308. Performance Review 190E-Procurement and Online Purchasing 190Business-to-Business Digital and Social MediaMarketing 191PARTHOSPITALITY GROUP MARKETS 192Conventions 192Convention Bureaus 193ASSOCIATION MEETINGS194Corporate Meetings 194Small Groups 195Incentive Travel 195SMERFs 196MARKETING HIGHLIGHT 7.2 GREEN MEETINGS—THE RIGHT THING TO DO FORTHE ENVIRONMENT AND BUSINESS 197A01 KOTL9844 08 SE FM.indd 89III Designing CustomerValue-Driven Strategyand Mix 233Designing and Managing Products andBrands: Building Customer Value 235WHAT IS A PRODUCT? 237PRODUCT LEVELS 238Core Products 23815/07/19 8:10 PM

Contents  ix11Facilitating Products 238Supporting Products 239Augmented Product 240BRANDING STRATEGYFACTORS TO CONSIDER WHEN SETTING PRICES245GENERAL PRICING APPROACHESMARKETING HIGHLIGHT 9.1 EXTENDING YOUR BRAND TO CHINA: WHAT NAME DOYOU USE? 251THE NEW-PRODUCT DEVELOPMENT 252Idea Generation 253Concept Development andTesting 256Marketing Strategy 257Business Analysis 257Product Development 258Test Marketing 258Commercialization 259259INTERNATIONAL PRODUCT AND SERVICEMARKETING 265CHAPTER REVIEW 266IN-CLASS GROUP EXERCISES 267EXPERIENTIAL EXERCISES 267REFERENCES 26810INTERNAL MARKETING272273Post Face-to-Face GuestRelations 274MARKETING HIGHLIGHT 10.1 PINEHURST RESORT & COUNTRY CLUB “DO WHAT’SRIGHT” 275THE INTERNAL MARKETING PROCESS 275Establishment of a ServiceCulture 276Development of a M