Marketing case study on TUI Travel: PESTEL and SWOT

merchandiseing case study on TUI Travel PESTEL and ramINTRODUCTIONTUI illustrates one of the most amazing and successful strategic reposition of a firm, among the largest European companies. From 1997 to 2003, its management turned one of the oldest steel and mining conglomerates, cognise as Preussag, into TUI the undisputed European leader in the tourism industry a fast growing but very volatile and competitive industry.TUI is a founding leading supranational leisure concourse which operates in 180 countries in the innovation and serve 30 million people. It headquarters in crawly surface Gatwick stressport in UK. It has 5000 employees and 146 aircraft. From the last ten years tourist industry growing at an annual pace of 4.1%, 2005 is the best year of the industry. In pecuniary year 2009 TUI travel receipts is 13.9 billion. In order to become a European leader, the group embarked on a steady programme of major acquisitions era divesting the non-cour trade. 1st January 2000 the Happing Touristic union was renamed TUI Group and jumped in the European market. Terriest attacks in New York (2001), BALI (2003) and Madrid (2004) female genital organ traumatic effect on international travel from 2000 to 2004. In 2005 tui to a faultk full control of leading approximate dealadian container shipping line, and linkd its container shipping division with it.EXTERNAL ANALYSESFactors that outside the organization which feces affect the organization eitherwhere aloneThese factors arePESTELPOLITICALAll the rules and regulation which give notice be imposed g everyplacenment of the country where the organization bay envelopow exit. What genial of facilities that the government feces bewilder the club to compete in the industry? Tax relief, in case of loss how much tax refund? Can government give the conjugation and acquisition when TUI give the sack enter the early(a) countries give care Asian (china, India)?Security problem is alike face all o ver the world, just like terrorist attacks in New York IN 2001, in London bus blast can affect too much in the international economy and international tourist industry in 2000 to 2004. Because all word can connect with each former(a) with as the global village thats why caller jargon face any problem to merge and acquisition with German companies, in UK , USA , India in china and other countries all over the world European counties, Asia pacific, American, Africa, middle eastSome government can impose heavy tax on companies that why it can piss a problem with tui when they merge with themECONOMICALCurrency exchange rates can also a big problem for tui when he can goes in the other countries. Difference mingled with Pakistani currencies any UK and others same with the other countries.In all over the world whole economy run on oil prices when they can fluctuated in can create a problem same situation with tui. Lower barrier to enter in the market can create a obscure position in competition.SOCIALTui can give the client spend packages, online booking facilities mark is a unique(p) thing that conjunction can bid to its customers. Its about(predicate) the perception of the customer different brand for different countries. If we can follow the BCG matrix is can tell the good position of the troupe. All the other companies tui can also adopt the constitution of going greenTECHNOLOGICALTui can introduce on line facility for its customer to purchase slating and any information that they bespeak. In this way they can cut staff damage and intermediates. Your customer is only one click far away from you and anywhere else. Tui can launch TV programmes, save customer data base to keep in touch with the help of video conferencing.In 2002 they can reengineering their draw and decrease their fuel efficiency they can work on more productionivity. Tui can also use EDS planning system for the cost efficiency.wellness problem is also face by the tourist industrie s. Even how WHO cant impose any bane to go the countries in which swine flow is (HINI)LEGAL contrasting counties government can impose different kinds of rules and regulation regarding health and safety (Aviation Safety and Regulation). Some trade laws just like ban on merger and acquisition.Different airport right for some carriers. If the government can want to monopoly he cant give permission to the troupe to made air- port in a country. companionship can defend permission from the governmentENVIRONMENTALIn German TUI AG can introduce environmental system match to ISO14001 in their head quarter. Both the management system like climate protection and biodiversity and in house system just like, wastage management, energy protection can give tui world- all-embracing recognition to good environmental policy.INDUSTRY STRUCTUREWhen we can talk about industry structure of tui we mean industry life calendar method or swot analyses of the smart set.SWOTSwot analysis can be used to ju st like other analytical tools like PESTL and porter louvre forces to analyses the internal and external position of the caller-outStrength and WeaknessesStrength is the internal factor of the tui travel which can use telephoner to remove weakness. For this intent company can use its fianc department, it accounting, HR, selling to improve weakness, the company can improve its weakness. Company can use its technological, strategies, distribution channel, its product quality, management to get over the short assess to distribution, low customer retention, weak brands, absence of important skills, etc.Opportunities and threatsToday is a word of competition, tui travel can reach a too much threats for the externally, tui can have a opportunities to overcome the threats like technological advertizement, new distribution channel, low taxes, liberalisation of geographic market, introduce new packages for the spend, online ticketing facility, to overcome the technological advancem ent, change government policies, tax increaseCompetitive analysisCompetitive analysis can help organization to think about the by-line things. Its main competitors are Thomas cook, My Travel group, Rewe Touristik.1. Competitors past present and future history2. Future investment criteria3. Basic strategiesThese can solve our different problems and serve up the questionsWhat our competitors?What are their objectives?Whats their weakness and strength?Porter five forces can also tell us about the competitors position these all include external factors scourge of entryBarriers to new entranceToo much cracking and resources are required.70% share can be controlled by 10 leadersBrand loyalty can also be problem for new entrance.Economy of scale should be in high spiritsSubstitutesIn airline industry there is no substitute. People can use other ways but nothing is better than air jet. Company can beseech different seasonal offer for the customerBargaining forcefulness of suppliersIf the company have low share in the market then supplier power is also to be high. quadruplet market leaders cover more than 50 present markets there is threat of backward integration. Its show only supplier moderate barging power.Bargaining power of buyersEmergence of internet and online there is low switching cost of buyers. Companies have fewer substitutes limit the barging power of buyersCompetitive rivalriesModerate level of competition exists in industry. Fix cost also to be high favour the company. And there is 8% market share between two companies (Thomas cook 13% and tui 21%). cod to these reasons there is low chance of competition.Resource and capabilitiesCompanies have some internal resources and some external resourcesFinancial resourcesTangible resourcesIncludes the company air jets, busses, exposit that they can hire, production plant which can work for production of goods.Intangible resourcesThe resources which we cant see directly, its include tui brand company can has near about 200 brand in which includeTui ThomsonNovellas frontiersTui DeutschlandThe mooringsTui arkMarmaraFritidsresorLate rooms.comTurcheseHayes JarvisAir toursEtc. These are the main brand which can be offered by the company for its loyal customers.TechnologicalCompany can introduce on line booking system for the convenience of its customers, and minimize cost. Well known logo smiling to represent a subroutine of companies in which UK tour operator Thomson Holiday. TUI has a 80 tour operator and 155 aircraft around the Europe. Tui have a number of big hotel, ships people can purchase ticket online anywhere from the world.Human resourcesCulture and visionWe are a leading world travel group we have a strong value in and culture in the eyes of our loyal customers. We always keep in mind our customers expectation and the period which they can spend with us. We want to do something new every day. We can look the opportunities which can be helpful for our customer and make value score for themExternal resources and capabilitiesAlliance with partnersCompany can also alliance with Air Berlin seal and tui CEO says we are very happy to deal with German company in this way we can reach the German market and give excellent performance and we despite the recent uncertainty.DistributionOur choice is to provide customer holiday option for meet their expectations we also know the dynamics of the industry. Customer can purchase on line tickets from our tour operators in anywhere in the world.Porter value chainFirm infrastructureTui can have a big structure it can add value at every aspect, like its marketing department, finance department, RD department and all other can add valueTechnology developmentTui can introduce new air crafts, busses, and accommodation and on line ticket facility for its customers.Research and developmentTo compete in the industry company can increase its product line. Tui can introduce new packages on holiday, on special occasion at crimes on Easter give extra facilities to its customers and charge them moreSupporting activities gain customer and security check is an important thing then company can luggage handling facility for its customerIn escapism service of process like dinner, lunch, drinking and other faculties like newspaper, internet etc.Marketing sale and booking facility all over the world direct or online from their retail shops or online use of net.Profit margin which the company can take to spent on these actives and money they can earnVA=sales revenue purchase on profit and loss A/C depreciationCompany structureCompany can have 200+ brands and product for wide variety of differentiated and flexible travel experience for fulfil expectations of their customers. Company strategic goals is to increase shareholder expectationCompany want toLeading worldwide Leisure Travel Company.Capitalized market 2.5 billion.More than 50000 colleges operating across 6 countries.Strategy synopriesStrategy is a well pl anned series of action. Tui scheme is to create superior share holder value by being the world leading leisure travel group providing customers with the choice of differnetiated and good experienceFor achieveing this answer company can set four areas in which they can focuseProduct and contentDistribution and brandPeople and operational effectivenessGrowth and capital allocationProduct and contentAttention on the customer and change booking ratesEarlier Booking trendDifferent product to our competitors and unique in the marketplacePeople and operational effectivenessOur employess are our assetBusiness model that can react to chage demandYeild management systemand development of train capacityIncrease profit margin up 30 substructure points from 2.9% to 3.2%Integration progressing well with total synergies upgraded to 200mDistribution and brandsGood relationship with the customer agree in mind customer choiceHighly trusted brands that provide value and qualityGrowth and capital a llocation11 niche high growth businesses in specialist sectorsProgressing in growth plans well in Russia CISIncrease return on invested capital to 9.2%Consolidation with Canadian market through and through proposed strategic venture with sun wingCompany challengesTui industry activates are shows that the company can contributes 11% of GDP and its exports are 12%. Fifty worlds least develop countries rely largely on this activity for economic development and in this way and tourist spending shows that tourist spending reaches the bad position.UN world tourism organization estimates that this industry emits around five present global carbon emissions of which 2 present are aviation and the remainder are broadly speaking for transport and accommodation. We can display our part in reducing carbon wastage, protect biodiversity and limit the water we can use directly and other verificatory way to save biodiversity as this forms an integral part of our product when our customer are holid ay they can experience.These all are the hurdles which the tui travel can face. Our policy in this situation is this to avail social economic and environment benefits and make travel experience more comfortable and minimal environmental impact, esteem the culture and people of destinations can gain more and more benefitsTo achieve these goals we know that we are alone, but we alone lead the travel industry throughout. For this purport we can take following steps.Business decisions should be sustainable development.Sustainability impact on our day to day operation should be minimizeChange the holiday options which cant meet our requirementsFor attracting more customer take customers experience what they want from them.Made new brands and new techniques in industry revolution and set a benchmark it there is no competitiveTo avoid negative impact put something back into environment.Use our influence for the development.Give customer more inducement and relaxation for attract more an d more customers.We should support our supply chain for the purpose of minimizing effects.Strategic choiceBy strategic choice we mean which scheme tui use to become a most successful in all over the world? What is there policy? What techniques which they can use? What are their suppliers? How the company can grow in international industry? What is their growth rate, what is their price policy? What is their market policy? What is their strength? What their weakness? What their strength? What are the opportunities that the company can avail to become a successful in the industry?To evaluate these questions we can use following techniques and modelsAnsoff matrixMarket penetrationMarket penetration we mean existing product in existing market. If the company can introduce package in the existing market he should be penetrate the market he should start form the bottom level just cover its cost and not make too much profit. For the purpose of consolidation tui should use this policy in m arket to compete in industry. Companies can penetrate the market into theFollowing three waysGaining competitive customers modify product and service qualityAttracting nonusers or the customer who use other company product or servicesProduct developmentIf the company can introduce new product in same market he can spend too much on advertisement. He should launch particular location oriented packages, just like buy one get one free. Company can introduce low cost operation and packages, if he can introduce high cost less chance of success. Companies can use this technique to forUtilization of excess production capacityTo increase its product line to stay in the marketExploit new technologyIncrease overall market shareMarket developmentTui should be meanness on Russia, India, and china and make important to always show its own presence in the market. This strategy should go toward following two conceptsBusiness to businessIn which company can sale its ticket to their franchise and their agents can sale product or introduce new packages to the customer. It has low headache to the companyBusiness to customerIf the company direct connect with the customer online and sell their product just like tui international for the purpose of given tickets, online ticket confirmation, updates, take customer bio data etc.DiversificationIf the company can introduce new product in new market, what is policy? What is the position of our competitors? What are their weaknesses? Can company use their weakness to make himself strength?Diversification may be relate or unrelated. Diversification may be backward, forward and plane integrationBackward integration when the tui can extends its activities towards its input such as suppliers of raw materialsHorizontal integration when a company turn into business related to its activitiesInternational strategy of companyTui can serve over 30 million customers all over the world and work in 180 countries of the world. Company turnover is near about 80million Euros per year. To set presbyopic term strategy first choice holidays join tui in July 2001 and in 2002. Tui is a founding member of toi.As a specialist in emerging markets sectors is an international portfolio of travel business, company can focus on specific segment or geographic sector or country. Sector includes 40 business operation form North America, Europe and recently emerging markets in Russia and Ukraine. Company can also focus on student education tours and trips to the Far East, Africa or Australia. Company to selling brands include mostravel, turchese and Hayes Jarvis.Joint venture in Russia with CIS made tui utile and give a chance to a company to work with their local companies.Advantages of joint ventures and alliancesTui travel can share any kind of risk with other companies.Government can give the company relaxation to entryCompany can have a more resources and these resources can open new wind in the mind of thinkersCompany cant face any p roblem in licensingThere are some disadvantages of joint adventureMake good relationship with foreign partner.Too much limited ability to coordinating activities in other countriesDue to these limitations company some time face a lossGeneral strategies of tui TravelCost leadershipCompany can work at lower cost and broad target in all over the world. Environment can affect the company policy just like Iceland problem in all over the world flight, company can bear loss, what company can do to sustainExampleTo maintain its cost standard PIA (Pakistan international airline) can fly more flight to cover its costWe should keep in mind that cost leadership is minimizing cost to the organization to deliver the product or service. What the customer can wages it is different issue.DifferentiationThe way by which tui travel can differentiate product or service to gain the competitive advantage. For this purpose company need exact information of industry.Company should needAbility to deliver h igh quality product or service.Research and developmentAttractive sale and marketing staff to all over the worldFocus strategyBy which a tui travel focus on niche market where there is advance and luxury hotel for loyal people, business class in air jets, excellent pick and drop facility to airport to hotel etc.On the basis of these strategies company cant set its prices or goals lot of other models like PESTEL, BCG, and ANSOFF MATRIX can be helpful for the company to make their decision.If the company low cost strategy is attractive to attract more and more customer it is successful. But there is lot of other factors like porter five forces how can company remove hurdles which he can faceStrategy in actionWe can discuss the process which company can follow, organizing resources, changing and which strategy is company can use.Company structureTui can registered in London stock exchange and it formed 2007 by the merge of first choice holiday PLC tourism divisionCompany main aim is to create superior shareholder value, and the company aim is to get maxim profit to merge and requireWhat the company want to doLead international leisure Travel Company.2 200+ products and brands company can have.3 2.5 billion Market capitalisations$4 Company can have 3500 retail shops and 146 aircrafts in Europe.5 More than 50000 worker can work in 6 continents in all over the world.Company main aim is to make profit and employee number. For this purpose company can give different packages to customer.Change in strategyChange in climate is known as a greatest environmental challenge facing in all over the world and it is important issue for the tui international. As we know carbon emission can effect on green housing and put important part in global warmth.June 2009 tui travel peg carbon disclosure project regarding their planning to carbon management.Adaption changeTui travel can change his strategy according to situation of economy. For made any kind of change company can ask hi mself following questionsCan there acceptable demand and conditions?Can it give sustainable competitive advantage?Does it have a good strategic fit?Does it avert threats and take opportunities?Does it meet stakeholder expectations?It consists with core competencies and strategic capabilities?Kinds of changeAdaption changeIf tui travel can change his policy according to see current situation of stakeholders. For example company can introduce new package in holidays, in Easter, in Crismis festival.Evolution changeSometime tui travel can give packages to customer just like free insurance, free transport to their own restaurants etc.Revolution changeDue to any reason just like volcano ash in Iceland can create a problem in all over the world especially in Europe. All over the world flights for UK is disturbed.Some companies fly extra flights to recover this loss. This can create a big history in life of airline industry.Reconstruction changeIf the change can around the current situatio n, tui travel can change its policy day by day. inference/RecommendationTui travel can have a good understanding of internal and external issues these things can help him to face the stakeholders of the company. Its targets and ambitions formed on the basis of an inclusive process and do address its material issuesIn his sustainable development Report Company can have describe its targets, visions, missions, associated polices its board level commitment to achieve its goals.Solution of sustainable development challenges Tui travel can perform as a role model and made a long term policy.Tui travel focus on embedding and implementing its sustainable development policy and associated ambitious targets.Tui travel should be less management focus and more on stakeholders to determine their overall impacts to see their strength and weakness.Tui travel formalise its external stakeholder engagement process to better capture and report specific outcome of their stake holders and find solution s to its sustainable development challenges.