Tirol Werbung

You know where Tyrol is right? It’s in Austria – not the country with the kangaroos but the one with Mozart and the Wiener Schnitzel

Tyrol, Austria

Image taken from Google Maps

The tourism industry in Austria and especially in Tyrol is very dominant and important. According to the Austrian National Tourist Office (TourMIS) there were approximately 126m overnight stays in Austria, whereof 42.7m took place in Tyrol, in 2011. Tyrol has a population of about 718,000 people and 23,700 accommodations with 348,000 beds (Statistik Austria). However, the tourism industry is bigger than the mere amount of accommodations. Of course you have to consider public transportation, skiing regions, museums, casinos and so forth if you want to have a complete picture of who profits of tourism. Despite the fact that Tyrol is one of the most beatiful regions in the world (I live here – I know that), there has to be some sort of destination marketing done. Not only by the companies and towns/villages themselves, but Tyrol-wide.

This is where Tirol Werbung comes into play!

Tirol

Official “Tirol” logo

Tirol Werbung GmbH is a company founded 1989 and located in Innsbruck. Its overall mission is to strengthen the brand “Tirol”. Tirol Werbung develops the destination and the brand through communication and network within and beyond the Tyrolean borders.

Tirol Werbung Organization Chart

Tirol Werbung Organization Chart

In order to improve the domestic (tourism) industry they created several branches with different approaches to boost the brand (Sponsoring, Cine Tirol, PR, Marketing, Digital Media -> Facebook & Twitter, Tirol Shops, …). They are creative, innovative, and enthusiastic and collaborate intensively with regional business partners.

Why do I write a post about Tirol Werbung? Well, it is the company I write my master’s thesis for and this sort of brand and destination marketing brings up a very exciting question: What is the return for my social media ROI calculation? There is the investment of money from various sources put into social media marketing (among others). Ok. But how can the effectiveness be measured when the return is increased the revenue of tourism companies – which isn’t measurable within Tirol Werbung? How can the budget be justified when Tirol Werbung cannot come up with conversion rates linked to their efforts? I don’t have an answer to this – yet!

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Characteristics of the Tourism Industry

My thesis focuses on the tourism industry – or more specific the tourism industry in Tyrol, Austria. There are certain important characteristics about that industry which make it necessary and exciting for companies when planning a marketing/social media strategy. What is so special about tourism compared to the producing or trading industries?

Perishability

Perishability is one of the most important characteristics of the tourism industry. The products/services in the tourism and travel industry are consumed as they are produced. Hotel rooms and cable car seats cannot be warehoused for futures sales. When a hotel room is not booked tonight, you cannot take ‘tonight’ and sell it tomorrow. Once the train left the station, unused capacity cannot be sold afterwards – provided that it was no time-traveling train.

As an uncertainty in customer demand leverages this issue, hotels and travel agencies tend to overbook available rooms and seats. Finding an alternative product for the customer and living with the consequences of overbooking is statistically more economical.

Inconsistency

Noise

Image by Andy Carvin

Products of the tourism industry always differ. Even the same hotel room in the same week with the same weather can be perceived differently due to the mood of the chef. It is always about the experience that the customer makes. Rational product attributes like price, nights of stay, and additional services can only be compared to a minor degree. It is challenging to deal with the customer perception of the product (the perceived quality) as it is highly affected by numerous uninfluenceable aspects such as weather, construction sites, other customers etc. Hence, the product is very inconsistent and cannot be standardized.

Investment and immobility

Ball and Chain

Image by Travis S.

Talking about hotels and other accommodations there is usually a big capital lockup in the assets. Hotels have furniture, restaurants, TV-sets, laundry-service, pools, saunas etc. – invested capital that has to pay off.

And that’s not all – all those investments are attached to one locality which means that those tourism companies are to a huge extent dependent on the attractiveness of the region, the country, its surroundings and so forth.

People-oriented

The tourism industry builds entirely upon people. The interaction between the staff and the customer determines the perceived product quality. Unlike tangible products where the customer buys certain features, production quality, durability etc. the holiday quality results from personal interactions starting with the information and booking process over the stay up to the journey home.

Inseparability

Sleigh Ride

Image by Peter E. Lee

Most travel products are first sold and the produced and consumed at the same time. This is an aspect which clearly sets tourism apart from tangible products. When you buy a new computer it is produced and shipped before you see it on the website or at the retailer’s premise. The consumption of that computer – using it – takes place after purchase at your home. You cannot take the hotel room home – only the small bottles of shampoo and toothpaste. And you cannot enjoy the alpine sleigh ride in your living room. Tourism products can only be consumed at the supplier’s premise.

Intangibility

Tirol

Image by Tirol Werbung

Tourism products are intangible. A night in a hotel, a day in a ski-resort, the calm flight with the nice attendant, and the smiling tour-guide taking you to the peak of an alpine mountain – all this cannot be touched. Tourism is all about the time spent and the experience made. The products sold by tourism companies both can’t be reproduced or reused. Nor can the feeling of consumption be captured to its full extent. There are merely attempts with photographs and video cameras. Probably everybody was already in the situation where you showed your holiday pictures to your family or friends and said “Well, it looked better when I was there. The picture cannot really reproduce the sentiment)… Tourism is a subjective picture planted into the customers’ minds.

Inflexibility

Travel products are fairly inflexible in terms of fluctuation. Hotels cannot change their capacities quickly enough to react on spontaneous fluctuations in demand. Hence, such companies try to balance between high and low demands, so that it’s not too much of a pain for the company when restaurant tables remain empty and for customers when there are no more tables available.

Imitability

Offers and products by tourism companies are generally easy to copy. When the neighbor hotel adds a masseur to its SPA offer you more or less only need somebody with a firm grip and here you go. So how can hotels build a unique selling proposition? Originality, consistency, location etc. – but not by hoping that their services are not imitable.

These are all relevant characteristics, which have to be taken into consideration for marketing activities.  In my further posts I will discuss traditional marketing measures and social media marketing for this industry and I will slowly approach the ubiquitous ROI. So stay with me!

Measuring Social Value with Google Analytics?

Google just launched a new way to measure social network conversions in depth – which is pretty exciting. Implemented in the regular Google Analytics, businesses can now monitor in more detail what the conversion rates from social networks to transactions is.

Social Media Conversions in Google Analytics

(image source: Google)

It is now easier to follow specific networks and campaigns. The figure above illustrates the ratio between total conversions (Conversions), conversions through interaction – people who came to your site from a social network and transacted during that visit (Last Interaction Social Conversions), and those transactions, which have been prepared by your social media activities but didn’t take place on that visit but on a later one (Assisted Social Conversions). You surely have to be careful and critical interpreting the figures, but that analysis greatly facilitates the calculation of social media effectiveness. The distance from nonfinancial quantitative social media data toward financial return decreased a bit through this new feature.

But this new area of Google Analytics is not limited by sophisticated referrer-analysis but also monitors social media interaction originating from your site. This activity stream takes a look into the social networks and shows public posts and shares.

Social Activity Stream

(image source: Google)

All in all, Google makes it easier for marketers, SM managers, and other analysts to monitor the social media activities, to measure the influence inbound and outbound, and to quantify the effectiveness of social media investments – all in one place. Great tool.