Unit-2 Marketing of Service Product

Posted byanurag tripathi Posted in
Posted on Oct 05, 2016

Unit-2 Marketing of Service Product

Unit-2 Marketing of Service ProductIntroduction

Price has been an important factor determining the quality of the product and the benefits that customers derive from the product. (Yoo, Donthu, & Lee, 2000)
This element of the marketing mix includes the total costs that the customers have to bear in order to avail a particular service. For determining the prices the service provider needs to consider that bearing the costs satisfies the customer needs and demands and they feel that they receive value for the money they invest. The company should also maintain a profitable margin. Hospitality is a unique industry where the decisive factor for the customers is not always pricing. They look for comfort, safety, ambience, accessibility to other places of their choice and access while choosing the hotels.  Although price is an important factor. (Constantinides, 2006)
My analysis of the Rockhampton Plaza Hotel suggests that as the hotel does not provides the services of booking through its own website and uses this activities outsourced to travel asgencies and tour websites, the hotel by itself lacks having bargaining power in terms of pricing with the customers.

  • The hotel charges 350 AUD room rent per day and the customers can avail discount of 10% by booking 20 days in advance
  • 100 AUD charged for guests checking out within 6 hours of booking
  • Price for eating in the fountain view restaurant is lower than ordering for room services. Room service rates increases at night
  • The hotel charges high service rates than compared to other hotels in the location rate of availing the gym facilities are 50 AUD
  • Discounts to the tour operators and the online websites are provided based on the quantity of guests they bring about 15-25% discounts are offered and sometimes seasonal discount of 50% is offered by some websites(HotelClub, 2014)


This element includes the decision of the management in selecting where the services should be provided. Rock hampton Plaza Hotel International is located on the Bruce Highway. The location of the hotel is very advantageous for it as it is the tallest building in the location and it is located just opposite to the Rockhampton Rainbow Fountain Central Park. The view of the fountain is an added advantage making it choice destinations for many tourists and people opting for weekend excursions.
Place Advantage: The hotels should always consider the location advantage before the choice of the ‘Place ‘of the marketing mix. Rockhampton Plaza Hotel seems to have ample of location advantages namely;

  • Excellent view of the Rainbow fountains
  • Close vicinity to tourist’s attractions such as the Koorana Crocodile Farm, Old Glenmore Homestead, Great Keppel Island and Riverside Walks to name a few
  • Well connected with the roadways therefore making it easy to reach
  • Distance to the Rockhampton Airport from the hotel is 3.6 Kilometres  (agoda, 2014)


These promotion benefits the service provider by leading more customers avail the service. Promotional methods for product and services are similar in many occurrences. The promotion strategy also helps in retaining the old customers by implementing loyalty programs for them. For hospitality industry the word of mouth strategy also works well, internet has become a powerful tool for advertising the hotels.
Advertisement strategy: The promotion of the hotel is done by using the print media, classified ads in newspapers and travel magazine, social media and internet has become a powerful tool that the hotel is using to attract international guests who visit Rockhampton for travel and tourism and are in quest of a comfortable and feasible location. The hotel has tie ups with travel agents and tourists services who get their guests for accommodation in the hotel the hotel in turn avails them with special discounts.
Word of mouth- The influence of the word of mouth has been always cited by experts. This influences the marketing decision significantly. This is an important strategy in the hospitality industry. It is true that one satisfied customer brings many.  I saw that the hotel uses pamphlets encouraging the guests to inform their friends and family about the hotel experience. Hotels have implemented word of mouth strategy from long ago which has become more developed recently. They give discounts coupons to their guests which can be availed by their friends and acquaintances. (Buttle, 1998)
Special discounts –These are availed to the customer who books the hotel at prior notice and also discounts and offers can be seen if booking from travel websites one such website is Hotel club website (http://www.hotelclub.com/Rockhampton-Plaza-Hotel/) and Chasing Destination website (http://coupons.chasingdestinations.com/rockhampton-plaza-hotel-coupon-code/) which offers best prices.


Unique component exclusive to service industry. As in service industry there is face to face interaction with the consumers efficient staff trained on service providing is an added competitive advantage. The prime focus of hiring employees for the hotel industry should be having a guest driven service that enables nurturing and training the employees in having the right orientation to serve the guests and satisfy them Hotels need to focus on hiring leaders that are efficient and enthusiastic managers and supervisors that helps inculcating the culture of better customer management and superior services in them.  Hotel industry suffers a deficit in the talent pool of the right kind of enthusiastic leaders. It is observed that the industry still lacks the appropriate approach to indentify and attract the desired talent pool. Also the pay scale for managerial jobs in the hotel industry is not competitive as compared to the pay scale of managers in other profiles. The hotel industry seems to lack formal strategies and programs for management development. (Williams & Hunter, 1991).
On interviewing the management I discovered that the Rockhampton Plaza Hotel that the hotel considers the attitude and aptitude for managing people and client relationship as the prime factors when hiring their employees. The hotel focuses on imparting on the job training to its employees. It has a program for reward and performance based appraisal. The concentration on employee motivation and reward is not much. The hotel lacked the existence of a HRM system.Order Now

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