Gap 360 is a UK based travel company that aims to make travel affordable for students who want to explore travel opportunities in their gap year. These are fun trips and adventure trips that appeal to the youth. People travel for the purpose of leisure and voluntary work in terms of wild life, teaching and conservation. At present, the company offers travel to over 50 countries.
The report is a situational analysis on the company that assesses the factors that are affecting their market position within the travel market for gap years in UK. The paper would also describe variables that have an effect on the gap travel period’s external and internal micro and macro ecosystems, as well as the sector in which they work.
A good executive team and extensive business experience are the company’s main assets. This is supported by a thorough knowledge of the framework and strong architecture relations, all of which help to build a more stable travel network. Gap 360’s proposals are backed by a solid knowledge of social networking and internet marketing, as well as a substantial amount of financial data. The economic recession, along with an increase in the number of small rivals, has led to increasing marketing costs and increased the difficulties in achieving the target SEO speed. Gap 360’s main prospects provide substantial opportunities to recruit quality performers at reduced rates owing to the present economic condition.
In addition, the organization gains from the economies of scope that come from large-scale enterprises as opposed to smaller companies with high operating costs. The company’s development can be accelerated by a fast organizational framework and strategic alliances. The poor economic situation, which restricts the consumer’s discretionary income and, as a result, his expenditure on leisure travel, is one of the few challenges the Gap 360 must be wary of. Shortfalls in investment and inefficiency in operations may also result in major setbacks (Hill and Jones, 2012; Goodley, 2010).
The diplomatic situation in the United Kingdom is relatively peaceful, and the organization organizes trips to places that are safe for recreational and educational travel. On the economic sector, the corporation is experiencing difficulties as a result of the declining UK economy and the resulting financial crisis. Spending on recreational sports in the United Kingdom has declined, and unemployment is at an all-time peak. The social climate seems to be favorable for gap year travel. Other countries, such as Australia, are following suit, which could help Gap 360 extend its organizational reach. The technology is the key to success and functioning of Gap 360 because it primarily operates through online promotions and bookings and the evolving social media and internet marketing options expand the scope further. The legal stigmas of the travel sector are universally applicable for all kinds of travel companies. Strict compliance is necessary in order to ensure smooth functioning. Lastly, the environmental concern has to be kept well under consideration to allow for compliance and adherence to strict environmental norms (Macinnis and Folkes, 2009).
Key Success Factors
The key success factors that contribute to company success can be listed down as below:
- Growing trend and unique business niche of gap year travel.
- Extensive use of technology in marketing and promotional activities keeps the company updated and ahead of competitors from the technological advantage.
- Strong management and good financial support ensure smooth functioning and proper implementation of business plans (Baines, Fill and Page, 2011).
Specific: the primary objective is to be the market leader in UK for the gap travel industry. The specific plans to be supported by tough target achievement, strong advertising and online marketing techniques and tapping of new markets via strategic partnerships with institutions and universities to promote gap year travel. The company targets to achieve growth rate of 11000 bookings per annum by 2016. The present growth rate is 3000 per annum (Baker and Hart, 2007).
Measurable: Such targets are to achieve repeat sales of gap year trip to the tune of 10% and use the allocated budget of £300,000 for 2014 to go forth with the plan and also budget for the future budget based on the action plan towards target attainment.
Achievable: The gap year travellers in UK majorly fall within the age group of 21-25 years. Such travellers are young and enthusiastic and studying in top universities across UK. The concept of gap year travel is more popular in the urban UK than the rural areas. Hence it is expected that budget travelling might not pick up as great as adventure travel. Additionally, the UK government also wants to increase travel spending among the people in UK from 40% to 50% within UK (PWC, n.d.). This shall bring in the much needed support from the government for travel plans and packages within UK.
Realistic: The plan is realistic because the gap year travel industry is unique and new in concept. The regular tour plans fail to cater to adventure needs of the youth and it is expected that high growth shall come in from the lack of travel plans for the youth. The unexplored business niche is expected to grow rapidly and earn swift profits.
Timed: The marketing plan shall be designed to achieve the desired target by 2016 of an annual sales increase by 11500 per year so as to achieve the broader target of gaining leading market position in UK in the field of gap year travel by the end of 5th year in 2019 (Dess, Lumpkin and Eisner, 2009).
Forecast Bookings for the 3 years 2014-2016
|Growth # of bookings||1135||2500||3860||5789||11000|
Projected Budget Requirements 2014-2016
|Grand Total (In £)||299971.7||356166.7||4250000|
Targeting and Data Strategy
The company, Gap 360 plans to target the following two market segments
- Students within universities who take a Gap year in universities to travel and enhance learning. These people are career oriented and do not look to spend largely on leisure travel. Such travel enthusiasts want knowledge based travel and look for budget tours. Certain sections also want to seek work experience abroad during their gap year. People also want to spend time in voluntary services in countries that are in need of help; however the number of such travellers is very small.
- Student who belong to rich families and inherit money from their association with wealthy families. This group might also have younger people who want to travel for fun.
The cities that shall be targeted will be the ones that have more number of universities and thus higher availability of students seeking Gap year travel. Students tend to travel more for the fun of outdoor activities that involves thrill, adventure and a lot of physical pushing (Crawford and Cribb, n.d.).
This certain group of people have been chosen because
- Their needs are largely under catered.
- They are willing to spend premium amounts for the satisfaction of thrill and adventure.
- This target market traditionally seeks to spend extra money over adventure trips.
Gap 360 shall position itself as a provider of high adventure travel and a provider of budget travel experiences with premium pricing associated with adventure packages it shall also have a segment that is devoted to cater the students who seek to travel for a learning and education experience based on customised packages (Gap360, 2013).
Gap 360 shall leverage over their competitive advantage in providing high thrill and adventure sports that cater to the needs of the budget constrained traveller (Porter, 2013).
This segment of travel is popular with most other travel providers who also look to pitch the adventure loving niche. This is because the numbers of people who seek adventure travel are very high. The travel trips organised by Gap 360 stands out because they provide more exclusive trips and exceptional meals in affordable and comfortable accommodation within limited budgets. The adventure activities that are offered within premium packages are designed to offer what most packages within the industry do not offer. The charge is also nominally kept high. Adventure travellers shall have the best terrain and river sections to explore. Tour guides are friendly, adventure lovers and have a huge experience in management of adventure tourists. Safety arrangements shall be the best in class. The premium tourists shall have an experience worth reckoning for (Pride and Ferrell, 2011).
Additionally, Gap 360 plans to take on customer service and attention to customer needs as a tool to gain competitive advantage. The company plans to have a low client employee ratio with a view to cater to each client attentively and with personal focus. In summary, Gap 360 wants to meet the customers’ expectations to the best of its capability (May, n.d.).
A digital strategy has to involve much more than just a company website. The data strategy depends on the kind of promotion that the company plans to undertake and in the scope of this paper. The data strategy is going to be quite different (Chaffey et al., 2009).
The company plans to advertise and promote its business largely through a digital marketing strategy. This is quite in sync with the target market the company seeks to target for its unique product. The target market is young students who have grown in the internet generation and feel at ease to deal and make plans using the internet. They use the internet in their education and it has become the part and parcel of their lives. Most kids spend some amount of time regularly on the social networking sites and with the advent of smartphones, the world of apps opens up another area to explore (Webmarketing, 2012).
The travel industry in UK is a very resilient one. This means that the sector is changing very fast but the travel industry needs to react quickly in order to remain competitive and thereby adapt to such changes. The advent of mobile technology and the advancement made in internet technology has changed the way people reach out to their consumers. This has also changed the way consumer research is carried out including share and purchase decisions (Department for Culture, Media & Sport, 2013).
As per the Google data, about one third of the travel industry across the globe went online by the year 2012. This figure is projected to increase dramatically within the next few years. As per research 90% of the travel decisions have been influenced by the use of internet in some form or the other. This ensures that the way ahead is ensuring that the travel company remains a step forward form the digital consumer (Stokes, n.d.).
Initial Recommendations for 2015 & 2016
For the year that follows the 2014 budgeted experience it is suggested that the post plan analysis of the budget is carefully carried out. Such analysis shall include
- Staff analysis such that the additional staff requirements and other such operational needs for the marketing process are carefully analysed and then spent on.
- Increase in the number of hits on the websites as a result of social media marketing and other online marketing techniques are judged to increase the focus on areas that need attention and are lagging behind.
- Before going forth with the projected budget requirements for 2015 and 2015, the company also needs to check for the degree of budget deviations that have occurred and plan a deviation checking mechanism such that the forthcoming years are kept well within control. Such deviations also need to be corrected.
- If the target achievement for the particular year falls short, additional sourcing of finance should be avoided by adjustment within the projected funding plan so as to reduce any compromises on company profitability and therefore the overall goal.
The test program shall be an analysis of the increase in the number of hits and the conversion rate of each hit as per the data provided on the online platform.
The analytics tools for the website and the data provided by the company in terms of bookings made online and related consumer survey shall be compared and contrasted to see what is the rate of conversion or the number of people actually booking a trip with Gap 360 in comparison to the number of people spending significant time in analysing their tour packages. Such analysis shall be a quarterly event so that planned targets are kept within limits and deviations, if any, are checked in time (Thomas and Housden, 2011).
On the social media promotion, the popularity of advertisements shall be reflected in the number of visits the website or social media page has based on number of clicks. It is to be noted that the number of hits in the present could also be taken as a possible sale in the future and cannot be eliminated totally if the sales have not been generated. To answer this ambiguity, one can take the count of a good response that has come to the company by way of customer query. A good query is classified as a question wherein the requirements are clearly stated, the email or contact has been clearly provided and the duration spent on the website is more than 5 minutes (Close, 2012).
Such a quarterly analysis shall ensure that the results of digital marketing program are carried out in a planned and efficient manner.
Details of Measurements for Being the UK Market Leader
As per the UK market research report, the number of undergraduate students pursuing education in UK is about 1803840 and that of the postgraduate students is 536440. This makes the total higher education student count in UK equal to 2340275 or roughly 2.3 billion people (Pray, 2012). Of these about 2 million people take gap year trips every year and the trend is catching up. Research has also suggested that gap year travellers might be school dropout as well. Such differentiated market does not allow to clearly defining the target segment (Higher Education Statistics Agency, 2013).
In order to become the UK market leader, the key tools that shall offer a substantiate reflection of market leadership shall include the competitor analysis and their relative position in the market. For this, the business needs to make a careful analysis of the gross comparative revenues, number of bookings and relative profit figures. Such data is also to be compared on cost basis so as to ascertain the long term profitability. Large companies should ideally be economising on scale of operations and thus operating at lower costs. In such case if the costs are high, sustainable and long term market leadership cannot be assured (Gov.uk, 2013).
For the first target segment that consists primarily of individuals who have educational, professional and voluntary needs. The budget plans shall be so designed that the company is established as a specialised and differentiated provider of customised travel. The one who seeks adventure shall also associate the thrill and adrenaline rush like no other travel company can offer. Such users can be targeted on various social networking websites like Facebook, Twitter and also professional networking websites like Linkedin (Chaffey and Smith, 2013).
The key messages for this section can be highlighted as below
- Affordable travel with unique experience.
- Educated guides and customised travel packages
- Consultancy service for those seeking to travel for professional purposes and related facilitation of company employee coordination
- Budget meals and stay
- Unique visits with tour packages that are unique even within the budget travel segment and smooth transportation facilities.
Once the target market is reached by way of data analysis and online social networks, the related works and promotional advertisements on budget and inexpensive work and educational travel shall be highlighted. Also, university websites within UK shall be approached to help the company in advertising within their ad spaces and also promote gap year travel within their programs. Our unique offerings in voluntary programs include strategic tie ups with NGO’s located in multiple countries that have their own programs to enhance travel and serve experience.
This segment does not care about money and seeks adventure and thrill even at premium prices. The youth comprises of students who come from rich families or have immense wealth and want to spend it for leisure during their gap year. The niche shall be targeted with premium and offbeat adventure experiences in locations that are unique and most desired. Such adventures include skiing, skydiving, scuba diving and bungee jumping among others. Camping and forest trail living shall also be included within these packages to make the stay also appear adventurous and unique. All the luxury shall be encompassed within the tour package to make the entire experience a pleasurable one. Exotic cuisines shall be offered for meals while tour guides shall be experts that have long experience with outdoor adventure and travelling. Safety shall be the primary feature within these packages.
The target segment shall be reached out by way of online and social media promotions where thrill and adventure campaigns shall be launched and promoted. The website shall also cover a whole lot of reviews and experiences that shall be shared and promoted via the online platform. The unique offerings like exotic food, exclusive locations and travel and adventure sport experiences shall be the key highlight of the digital marketing promotions (Barker et al., 2013).
Detail Budget Breakdown
|Growth # of booking||1135||2500||3860||5789||11000|
|Value per booking||1000||1000||1150||1200||1435|
|Gross revenue growth||1135000||2500000||4438596||6947368||15785000|
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