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MTTM-06: Marketing for Tourism Managers

MTTM-06: Marketing for Tourism Managers

IGNOU Solved Assignment Solution for 2023

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Assignment Code: MTTM 6/MTM 6/ TMA /2022

Course Code: MTTM 6/MTM 6

Assignment Name: Marketing for Tourism Managers

Year: 2022

Verification Status: Verified by Professor


1. What do you understand by “Marketing Research”? Discuss the relevance of Marketing Research for Tourism Industry. 20

Ans) Market research is defined as the process of evaluating the feasibility of a new product or service, through research conducted directly with potential consumers. This method allows organizations or businesses to discover their target market, collect and document opinions and make informed decisions.


Market research can be conducted directly by organizations or companies or can be outsourced to agencies that have expertise in this process. The process of market research can be done through deploying surveys, interacting with a group of people also known as a sample, conducting interviews, and other similar processes.


The primary purpose of conducting market research is to understand or examine the market associated with a particular product or service, to decide how the audience will react to a product or service. The information obtained from conducting market research can be used to tailor marketing/ advertising activities or to determine what are the feature priorities/service requirement (if any) of consumers.


Objectives of market research:

  1. Administrative: Help a company or business development, through proper planning, organization, and both human and material resources control, and thus satisfy all specific needs within the market, at the right time.

  2. Social: Satisfy customers’ specific needs through a required product or service. The product or service should comply with a customer’s requirements and preferences when consumed.

  3. Economical: Determine the economical degree of success or failure a company can have while being new to the market, or otherwise introducing new products or services, thus providing certainty to all actions to be implemented.


Importance of market research:

  1. Valuable information: It provides information and opportunities about the value of existing and new products, thus, helping businesses plan and strategize accordingly.

  2. Customer-centric: It helps to determine what the customers need and want. Marketing is customer-centric and understanding the customers and their needs will help businesses design products or services that best suit them. Remember that tracing your customer journey is a great way to gain valuable insights into your customers’ sentiments toward your brand.

  3. Forecasts: By understanding the needs of customers, businesses can also forecast their production and sales. Market research also helps in determining optimum inventory stock.

  4. Competitive advantage: To stay ahead of competitors market research is a vital tool to carry out comparative studies. Businesses can devise business strategies that can help them stay ahead of their competitors.


Marketing Research in Tourism

Marketing research aims at collecting important information from the customers. In the case of tourism, the tourists are the customers. Just like any line of business, the tourism industry needs to strengthen its relationship with its customers by improving the quality of its services. Marketing research can be an important tool in fulfilling such need.


Function: Marketing research allows tourism organizations and businesses to gather and consolidate information reflecting customer satisfaction, wants and needs. In addition, it can also provide statistics on customer`s number of visits, profiles and characteristics. The research can also measure which facilities and activities are very popular among the tourists and which areas of offered services need improvement.


Benefits: Once we are able to retrieve relevant information about customers, we will be able to make calculated decisions and plans to satisfy customers and provide a better service. These decisions may include improvement of facilities, entertainment activities and customer service. When customers are satisfied, this will result to repetitive visits. Such customers become advertising tool as they will share their experience to their families and friends.


2. Describe the considerations involved in designing marketing organisations. 20

Ans) The considerations Involved in designing the marketing organisation is as follows:


Statement of Objective and Goals of the Firm

The company's marketing objectives and goals should be taken into account initially while establishing the marketing organisation. These goals may have to do with intended market share, sales and/or profit levels, desired market position, desired customer image, and competitive positioning. A proper organisation would need to be developed in accordance with the stated goals in order to support goal achievement. For instance, a company that wants to dominate the market would require a different kind of structure than one that wants to provide the best products.

Nature of the Product / Line of Activity

The second factor in organising the marketing setup would be the type of product that the company is working with. No specialised knowledge or expertise relevant to the nature of the items is necessary to sell soap, toothpaste, textiles, tea, etc. All people can easily understand and comprehend these products. When planning its marketing setup, the company dealing in such products does not need to hunt for sales staff with specialised skills. On the other hand, before attempting to market things like air conditioners, refrigerators, industrial machines, cooling towers, anti-pollution plants, and computers, marketing personnel must have at least a functional understanding of the machinery.


Areas of Operation

Another aspect that affects the choice of the type of marketing organisation a corporation should use is the number of markets it serves and the location of these markets. A company may be forced to create distinct marketing organisations for various geographical markets if there are numerous marketplaces that are spread out far from one another. The necessity for a distinct, adaptable, independent marketing organisation at the local market level is stronger the more distinct each market's client tastes and habits are.


Nature of the Industry

Depending on the type of industry a corporation is a part of a marketing organization's design and structure will change. A company with rapidly changing consumer preferences or rapid technology advancements requires a marketing organisation that is adaptable to the changing environment. Additionally, the marketing organisation needs to be set up in a way that encourages interaction across related sub-functions that are essential to the success of marketing, including sales. and sales and R&D in electronics, as well as marketing research in the case of high-fashion clothing.


Computerisation and Up-gradation of Information System

The kind of information processing and communication technology employed has an impact on the marketing organisation as well. Since the invention of computers, there has been a greater decentralisation of decision-making, as well as the replacement of humans with machines for information processing, the replacement of supervisory managerial cadres that were performing the roles of supervising and controlling, but which can now be done more effectively by computers, and As a result, numerous intermediate management levels are gradually eliminated, and a flatter organisational structure emerges.


External Environment and Government Intervention

The environment in which a marketing organisation operates has an impact on the organization's makeup and personality. The environment at the level of the company is made up of social, economic, political, legal, and cultural elements. These elements have an impact on all business operations, including marketing. The marketing organisation is also impacted by certain laws and regulations that govern the product category and its promotion. Since alcohol and alcohol-based beverages cannot be advertised explicitly in the media in our nation, powerful sales organisations that can attract and keep dealers and compel prominent shelf placement at these dealer outlets are a must for liquor corporations.


3. What is the need of Sales Forecasting? Explain the various methods of sales forecasting. 20

Ans) The need for sales forecasting are as follows:

  1. The management of the enterprise can take decision regarding operations planning, scheduling, production programming inventories of various types, physical distribution and operating profits on the basis of sales forecasts.

  2. Long term sales forecasts can help in deciding investment proposals such as modernization, expansion of existing units, diversification of product lines etc.

  3. Sales forecasts are essential to make proper arrangement for training the manpower in its own unit or sending them to other industries in the country or abroad to meet the future needs of expertise.


Methods of Forecasting


Executive judgement: It is an efficient method of sales forecasting. Based on the past performance, insights gained and intuition of the executive(s), this method of sales forecasting works out fairly well particularly when the market is stable. However, this method generally suffers from difficulty in realistically reflecting changes in the market. Salesforce composite method and jury of executive opinion are the two popular forms of this method of sales forecasting.


Surveys: A second way of sales forecasting is by surveying the customers, salesforce, experts, etc. and ascertaining their predictions. Customer surveys can provide information relating to type and quantity of products which customers intend purchasing. Salesforce surveys can provide estimates of overall territory off-take, company's share and the share of the major competitors. Dealers survey may also form part of the salesforce survey if a firm so desires. Expert surveys provide sales forecast as the experts and industry consultants look at it.


Time series analysis: Using the historical sales data, this method tries to discover a pattern or patterns in the firm's sales volume over time. The identification of the patterns helps in sales forecasting.  Time series analysis helps locate the trend, seasonal, cyclical and random factor changes associated with the past sales data. In this way, it improves the prediction from the past sales data.


Correlation and regression methods: These methods attempt at examining the relationship between past sales and one or more variables such as population, per capita income or gross national product, etc. The use of regression analysis is done in order to determine whether any relationship exists between the past sales, and changes in one or more economic, competitive or internal variables to a firm. The accuracy of forecasts made by using correlation and regression methods is generally better than the other methods.

Market tests: Market tests are basically used for developing one time forecasts particularly relating to new products. A market test provides data about consumers' actual purchases and responsiveness to the various elements of the marketing mix. On the basis of the response received to a sample market test and providing. for the factor of a typical market characteristic as well as learning from the market test, product sales forecast is prepared. Substantial fluctuation that one finds in reality from market to market limit the accuracy of sales forecasts made by this method unless the market test is designed systematically.


Combining forecasts and using judgment: Experience brings out that the forecasts resulting from the use of multiple methods in a combined way greatly surpass most individual methods of sales forecasts. Research also supports the combined use of quantitative and qualitative methods of sales forecasting in a given situation rather than using either of the two. Application of judgment to quantitatively arrived forecasts should be done in a structured manner with a view to adding insights and realism to the forecasts so arrived at, since a forecast is a prediction and needs the subjective perception too.


4. What are the factors that influence the consumer behaviour? 20

Ans) Consumer Behaviour is influenced by many different factors. The five major factors that influence consumer behaviour are as follows −


Psychological Factors

Human psychology plays a major role in understanding consumer behaviour. Difficult to measure, but psychological factors are powerful enough to influence a buying decision. 


Some of the psychological factors are as follows:

  1. Motivation: Motivation to do something often influences the buying behaviour of the person. Individuals have different needs such as social needs, basic needs, security needs, esteem needs, and self-actualization needs.

  2. Perception: Our perception is shaped when we gather information regarding a product and examine it to generate a relevant image regarding a certain product.

  3. Learning: When a person buys a product, the general tendency is to learn something more about the product. Learning also comes over a period through experience. This learning depends on skills and knowledge.

  4. Attitudes and Beliefs: Consumers’ attitudes and beliefs also influence the buying decision. Based on this attitude, the consumer behaves in a particular way towards a product.


Social Factors

Humans are social beings, and the society or the people they live around influence their buying behaviour. Human beings try to imitate other humans and nurture a desire to be socially accepted. Hence, their buying behaviour is influenced by other people around them. These factors are considered as social factors. 

Some of the social factors are as follows:

  1. Family: Family plays a significant role in shaping the buying behaviour of a person. A person builds his/her preferences from his childhood by watching their family buy certain products and continues to buy the same products even when they grow up.

  2. Reference Groups: A reference group is a group of people with whom a person associates himself. Generally, all the people in the reference group have common buying behaviour and influence each other.

  3. Roles and status

  4. A person is influenced by the role that he holds in the society. If a person is in a high position, his buying behaviour will be influenced largely by his status.

  5. Cultural Factors: A group of people is associated with a set of values and ideologies that belong to a particular community.


Personal Factors

Factors that are personal to the consumers influence their buying behaviour. These personal factors vary from person to person, thereby producing different perceptions and consumer behaviour. 


Some of the personal factors include:

  1. Age: The buying choices of individuals depend on which age group they belong to.

  2. Income: Income influences the buying behaviour of a person. Higher income gives higher purchasing power to consumers.

  3. Occupation: Occupation of a consumer influences the buying behaviour. A person tends to buy things that are appropriate to this/her profession.

  4. Lifestyle: Lifestyle is an attitude, and a way in which an individual stay in the society. The buying behaviour is highly influenced by the lifestyle of a consumer.


Economic Factors

Consumer buying habits greatly depend on the economic situation of a country or a market. When a nation’s economy is strong, it leads to a greater money supply in the market and higher purchasing power for consumers. Whereas a weak economy reflects a struggling market that is impacted by unemployment and lower purchasing power.


Some of the economic factors are as follows:

  1. Personal Income: When a person has a higher disposable income, the purchasing power increases simultaneously. Disposable income refers to the money that is left after spending towards the basic needs of a person.

  2. Family Income: Family income is the total income from all the members of a family. When more people are earning in the family, there is more income available for shopping basic needs and luxuries.

5. Write short notes on any two of the following: 2X10=20


a) Sales Promotion

Ans) A sales promotion is a temporary or time-sensitive campaign designed to increase demand, generate interest, or encourage consumers to try a product or service.  Sales promotions come in many forms and support a long list of objectives. You might use them to attract new customers, boost retention rates, offload inventory, or deepen your relationship with existing clients.  That said, all sales promotions point back to the bottom line — and at the end of the day, the goal is generating more revenue.


Sales promotion advantages

The importance of sales promotion goes beyond quick wins and a pipeline full of leads.

The best strategies span the entire sales funnel and focus on very specific goals based on where buyers are in their journey.


A few examples:

  1. Bring in new customers. Attract new customers with discounts, free trials, or free products. Ideally, they’ll fall in love with your solution and become a loyal customer.

  2. Launch products or service offerings. Allowing customers to try out new solutions at a reduced rate can help you lock in the positive reviews and word-of-mouth recommendations that attract a wider audience.

  3. Offload inventory—fast. Many companies use promotions to get rid of aging inventory—whether that’s due to seasonality, poor performance, or a last-minute push to hit sales targets at the end of the quarter.

  4. Boost long-term loyalty. Sales promos help you nurture relationships with loyal customers, keeping them happy, engaged, and informed about upcoming releases & updates.


There’s a lot more where that came from. But, the point is, sales promotions can benefit the bottom line as much as the actual buyers.


Disadvantages of Sales Promotions

It’s important to note that many of the “disadvantages” associated with sales promotions are really just “strategic missteps.”  Sales promotions are generally a net positive for both business and consumer.  It’s just that there’s a lot that can go wrong if you say, make campaign decisions using incomplete or inaccurate data or fail to put customer needs first.  Potential disadvantages include:

  1. Hidden costs

  2. Price sensitivity

  3. Alienates customers

  4. Limits revenue


There’s also the risk of falling into a “sales promotion trap,” where discounting is the only way to reliably close deals.  The idea is, if you run too many promos, customers expect them – and eventually, will only buy from you when you’re running a promotion.  What happens is, you get caught in a cycle where you’re forced to invest in short-term discounting strategies, at the expense of long-term growth.


b) Advantages and disadvantages of Packaging

Ans) Advantages and Disadvantages of Packaging as follows:


Advantages of Packaging


Ultimately, a package may become a product’s differential advantage or at least a significant part of it. Today, with its marketing significance fully recognised, packaging is a major factor in the competition for customers. Therefore, full responsibility and authority for packaging should be with a firm’s marketing department.


Recent developments have prompted even greater attention to packaging Due to shortage of shelf space, it is not easy for manufacturers to get their products displayed in a retail outlet. If other marketing-mix elements are comparable, retailers are likely to purchase and display products having attractive functional packaging.


Furthermore, the widespread use of self-service selling means that the package must do the selling job at the point of purchase. In addition, the public’s growing concerns about safeguarding products until they are purchased must be considered in packaging. Once the product is purchased, the package may still play a role. Many food products are now packaged so that they can go straight from the shelf or freezer into an oven.


Continuing developments call for management’s scrutiny. We see new packaging materials replacing traditional ones – uncommon shapes, attractive look and other new features. All are intended to provide benefits to retailers and/or consumers and, as a result, selling points for marketers.


Packaging also plays a role in unboxing videos, which can garner millions of views. User-generated content is a valuable marketing asset that helps you spread the word and expand your consumer base. Think about the people who watch those unboxing videos — customers trust content from people like them. After seeing someone else unwrap a high-quality product in beautiful packaging, 79% of them will check it out for themselves.

Disadvantages of Packaging

  1. Packaging exhausts natural resources.

  2. Packaging is too expensive.

  3. Some forms of plastic packaging are health hazards.

  4. Packaging is deceptive.

  5. Used and discarded packaging contributes significantly to the consumer protection problem.

  6. Plastic packaging is becoming increasingly recognised for its damaging environmental qualities. Plastic can take thousands of years to biodegrade, so single-use plastic packaging is highly polluting. Even plastic packaging that claims to be recyclable often ends up in landfill.

  7. It requires additional cost for designing and order.

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