TUI

Marketing analyses of :

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I. INTRODUCTION

TUI Group GmbH (Touristik Union International) is a German multinational travel and tourism company established in 1968 and headquartered in Hanover. First, it was an association with some medium-sized companies like Touropa, Scharnow-Reisen, Hummel Reise and Dr.Tigges-Fahrten. During 33 years, TUI joined airline companies and participated to different hotel brands. They also expended their company to Switzerland, Holland, Austria and Belgium.

In 1998, they took acquisition of the group Hapag Touristik Union and 3 years later, in 2001, they became 100% subsidiary of an industrial and transportation Company named Preussag AG, which in the 1990’s decided to concentrate their company on tourism, shipping, and logistics.

On 3 September 2007 the tourism division of TUI AG merged with First Choice Holidays PLC to create TUI Travel PLC, an international leisure travel group listed on the London Stock Exchange. TUI AG owns 43% of the new company, operating in 180 countries and serving 30 million customers.

On March 2009, they decided to sell big parts of their important container shipping company Hapag Lloyd AG to the to the Albert Ballin consortium of investors. TUI retains a 43.3% stake in the firm and continues to wholly own and operate the cruise line Hapag-Lloyd Kreuzfahrten. This means that TUI has become a pure tourism oriented company.

This means that TUI decided to concentrate their activity in three different tourist sectors: TUI travel (tour operating, online sales, high street outlets, airlines and incoming agencies), TUI Hotels & Resorts and TUI Cruises, the cruise ship business.
Today, TUI GROPUG GmbH is the undisputed leader in the European tourism industry. They operate in over 180 countries worldwide serving more than 30 million customers offering a wide range of leisure travel experiences:

TUI Group unites over 3,600 travel agencies. Mainly located in Germany, the United Kingdom, the Netherlands, and Belgium, 39 tour operators belong to TUI Group, including the major brands TUI Schöne Ferien!, 1-2-FLY, Arke Reizen, Holland International and JMC, as well as many smaller tour operators specializing in narrower target markets. TUI customers often travel with one of TUI Group’s airlines, including German Hapag-Lloyd and British JMC, which own over 60 aircraft with about 14,000 passenger seats. Besides its own 18 incoming agencies, TUI Group offers tour guide services in 69 countries.

They have around 155 aircraft and 3500 retail outlets in Europe and employ 50,000 people worldwide. The company mainly serves the leisure travel customer and is organized and managed through four business sectors: Mainstream, Specialist and Emerging Markets, Activity and Online Destination Services. This has now moved full control of TUI's tourism division directly to TUI Travel PLC.

The company controls over 185 hotels in 19 countries, including the RIU, Grecotel, Iberotel, Grupotel, Dorfhotel, ROBINSON, and the Swiss Inn chains. Most of TUI Group’s hotels are located in Spain and other Mediterranean countries. With a major focus on holiday travel, TUI Group is also active in the business travel market.

II. Missions, Company’s Business

Mission

Their mission is to ensure the long-term successful existence of our company, and to peruse their long-term objectives. These enable them to maintain a clear focus in an increasingly complex and complicated environment which is changing ever more quickly. They aim to be the leading leisure company in Europe, offering quality-conscious holiday-makers holiday and leisure experiences all from one single source. It is important for their staff to be familiar with the objectives of the company, because they contribute to setting the targets for their own areas of responsibility

Company’s Business

(Company’s businesses explanations from TUI’s homepage)

TUI Travel

TUI Travel was formed in 2007 by the merger of the distribution, tour operator, airline and destinations operations of the TUI Group and those of the former UK travel group First Choice Holidays PLC. TUI AG is the majority shareholder of the company, which is listed on the London Stock Exchange. TUI Travel operates in 180 countries worldwide and services over 30 million customers. The company is based in Crawley in the UK.

TUI Travel’s business is structured into four sectors: Mainstream, Accomodation & Destination, Specialist & Activity and Emerging Markets. The portfolio comprises a broad range of products from package tours to niche products such as yacht chartering, expeditions and student trips.

Nowadays, TUI Travel is the leading European tour operator, which have almost 30 million customers from over 27 source markets. They work with over 200 brands and own over 143 aircraft and circa 3,500 retail shops in Europe. They also employ approximately 49,000 employees operating in all the continents of the world.

TUI Travel consists of 4 sectors, which include more than 200 leading brands.

Mainstream

Mainstream is the largest Sector in terms of size, financial performance and employee numbers. It comprises leading tour operators and ‘power’ brands and operates a fleet of 143 aircraft and circa 3,500 retail shops. It has three divisions; Northern Region, Central Europe and Western Europe.

Accommodation & Destinations

The Accommodation & Destinations Sector sells and provides a range of destination services in destination to tour operators, travel agents, corporate clients, and direct to the consumer worldwide.

Speacialist & Activity

This Sector is the world's leading provider of specialist and experiential travel. It has over 100 specialist and activity brands delivering a range of unique customer experiences with the ethos of 'if you can dream it, we can take you there.' The Sector operates under six divisions - Adventure, Education, Marine, North American Specialist, Sport and Specialist Holiday Group.

Emerging Markets

The Emerging Markets Sector is a growing portfolio of travel businesses focusing on the specific source markets of Russia and CIS, Brazil, India and China. TUI Travel is the first international tour operator to build a presence in Russia and CIS.

TUI Hotel and Resort

The stay at the hotel is the most crucial part of the holiday experience and hence key to customer loyalty. With 261 hotels and 170,000 beds TUI Hotels & Resorts is Europe’s largest holiday hotelier.

TUI Hotels & Resorts comprises hotel brands with high levels of quality and service as well as high environmental standards. The brands cover a wide range of hotel concepts at prominent and the most popular holiday regions and include such famous names as Robinison, Riu, Grecotel, Grupotel, Iberotel and Dorfhotel.

A fundamental element of the hotel strategy is to provide hotel capacity for the Group’s tour operators at the best locations in strategically important destinations. Being the link between the World of TUI tour operators and the hotel partners, TUI Hotels & Resorts guarantees a strong and proper positioning of the Group hotel brands in relation to one another as well as in comparison to the competition.

From the perspective of the customer, the hotel brand is highly relevant in the decision to book. As such, in the eyes of the guest, the hotel is the determining factor for the holiday experience and an essential component in the tourism business chain of the World of TUI. Hence, the hotel lies at the heart of customer loyalty. Consistent adherence to the group’s quality standards and an excellent value-price ratio are the main objectives of our service philosophy.

With enthusiasm and commitment, the various departments at TUI Hotels & Resorts apply all their experience, professionalism and creativity to achieve the best hotel performance, the highest degree of customer loyalty and economic success.

The latest project to come onto the market is the new lifestyle hotel brand aqi. The business model is based on the idea of developing the budget concept for the holiday hotel sector. Previously this concept was used almost exclusively in the business hotel sector.

Cruises

More and more people are discovering the attraction of a holiday at sea. With Hapag-Lloyd Kreuzfahrten and TUI Cruises, TUI AG’s portfolio has two quality brands offering the maritime holiday experience for different target groups.

III. Growth strategy past / present / future (vertical integration, diversification and specialization)

Past:

TUI has changed its initial strategy. Indeed, this highly diversified group of business has changed completely from industrial activities in tourism. TUI (Ex Preussag) was present in: • Industrial activities: iron and steel, energy (coal, oil, uranium, gas), • Logistics (shipping), • Shipbuilding, processing of waste, modular design and construction.

During the past TUI even tried unsuccessfully to diversify into health and cosmetics market, but it was unsuccessful, TUI became interested in tourism in 1997.

Present:

TUI is the world leader in tourism. Within a few years, the former Giant Mine and Steel has become a European leader and world number one trip.
Today The German group has three main areas of activity:

• Tourism accounts for 57% of its business. • Logistics: 17% of its business. • Industry: 25% of its business.

Distribution: exclusive distribution network with 175 offices worldwide.

Futur:

The group aims to divest its other two business lines and increase the tourism in its activities to 80% in the coming years. As well Tui have to break the prises

• More affordable long-haul holidays. • A long weekend in New York or a week in Australia. • Attract costumers to new destinations: Qatar becomes the new Canaries; Ljubljana the new Prague; Slovakia the new New Zealand.

As well, I have noticed with my research that TUI focus on the cruise tourism,
More recently, TX Europe has achieved a new view of the ship ordered in September 2011 by the German company TUI Cruises. Built by shipyards in Turku, Finland, the ship must be delivered in spring 2014. Significantly larger than the first two ships of TUI Cruises, the Mein Schiff 1 (Celebrity Galaxy) and Mein Schiff 2 (ex-Celebrity Mercury),

The new ship is about: • 295 meters long and 36 meters wide • It will have 1250 cabins, a capacity of 2,500 passenger

With this data we can say that TUI is investing to the cruise tourism, and it is very interested in.

Strategy:

Its strategy is based on the control of tourism products through Diversification through vertical integration that can be described as "multidimensional" because of the large number of acquisitions and brand treasury by the German group.

The detention of many:

• Hotels: 261 hotels and 170,000 beds • Agencies: 3,500 retail shops in Europe • Brands and aircraft: Over 143 aircraft

All these allows TUI to create a mass tourism and this can offer to Tui the privilege to dominate the European and world markets.

IV. Wiring expectations and constraints of the parties (PESTEL)

A. The objectives and constraints of decision-marketers

1. Objectives of TUI

TUI GmbH have a lot of different objectives:

- First of all, TUI wants to be one of the world’s leading leisure travel group by providing customers a wide choice of products with the flexibility to meet their changing needs, what means that they always try to be attentive to new trends on the tourism market.

- Then they also want to deliver earning growth and margin expansion through the combination of organic development and selected acquisitions, like for example the acquisition of “Nouvelles Frontières”, which is the French leader of tourism.

- Furthermore, they try to deliver cost synergies estimated to be at least 150 million euros per year within 3 years of completion

- It’s also very important for them to maintain a lean and efficient business model

- To maximize shareholder value is an important objective too.

This means that TUI GmbH wants to ensure a long-term successful existence of the company by having long-term objectives. This enables them to maintain a clear focus in an increasingly complex and always changing environment which is very complicated.

2. Constraints of decision marketers

To analyze macro environment of TUI’s industry and to identify the key factors affecting the objectives we explained before, we are going to use the PESTEL analysis of the group, what means that will focus on the Political, Economic, Sociocultural, Technological and Environmental barriers of the group:

- Political

Airlines and package holidays providers like TUI Travel are sometimes exposed to the risk of losses from political instability, accidents, terrorist attacks. TUI operates in a lot of different destinations worldwide and over 20 sources of market, where its operations will be at risk of domestic and international geo-political events are impacting business performance because they can directly affect their customers. This can affect a reduction I costumer spending on holidays.

Future terrorist attacks or the threat of such attacks could result in aviation or other insurance becoming unavailable, what will be a big matter for TUI because they would be unable to operate key parts of its business and they will have consequential losses.

Political instability can also affect tourism of that country, but also the neighboring countries can be in the same case.

- Economical

A very important role in international tourism is the exchange rate. This is due to the imbalance between the currencies in which turnover is generated and costs are incurrent and also certain of TUI’s subsidiaries operating in functional currencies other than the Euro. For example, the Euro decreasing the gap with the Dollar may affect the tourism from the USA and it’s tourist agents.

A very important of economical factor is the globalization. Thanks to it, a lot of companies have unlimited opportunities such as technologies, hotels, resorts, travel agencies…. There a less barriers to enter in new markets and to take over other companies. Globalization also increases competition and the quality of service.

Oil costs are also affecting TUI’s objectives and strategies. Aircraft fuel costs, which have fluctuates considerably since 2004, are affecting the operating expenses of the group and are subject to economic and political factors which are beyond the control of TUI. They have to surcharge on its short, medium and long-haul flights, which reduces demand of travel products.

- Sociocultural

The lifestyle of the costumers is very important and can influence TUI’s objectives. Nowadays, people have some other expectations and want special offers like for example holiday packages are online booking. It’s crucial for the group to be always up to date and anticipate these demands. But that needs a lot of time to analyze all of that.

Brand recognition is also a very important fact. A lot of people stay loyal to their brand and it will be very difficult to win costumers that are loyal to their competitors. That’s why it’s very important to provide some new offers and to be better that the competitors.

The changing of costumer’s way of life, especially the changing attitudes toward safety and the environment can also affect customers’ decisions. Costumers are getting more and more environment conscious and are more leaned to companies that offer an environmentally friendly policy.

- Technological

The most important technological fact is that the internet sales are increasing every day, what is very difficult to anticipate because it’s always changing. Thanks the to the graph form the “Internet World Stats” website, we can see that the internet users in the World increase considerably during the last 15 years, and almost reached 1700 million users worldwide.

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For TUI, it’s very important to know that more than 40% of this internet users get recreational or tourist information and book their by the net. This means that the have or will have to rethink their way of selling their trips. Maybe in a few years, TUI agencies will decrease or even disappear and they will only focus on internet offers. This can have a bad effect on costumers, because they will have less trust in TUI’s offers because there’s no face to face contact like in agencies.

In addition, any accident or incident of TUI GmbH’s aircraft will affect the tourism and its activities.

- Environmental

The emission of CO2 is a major threat for the company because the climatic conditions in earth and aviation are a major contributor of CO2. The government wants people, especially in Europe, to take the train because the rail travel emission is only one-third of air travel.

The health problem is also an important environmental constrain for TUI and tourism in general. Viruses like for example the ”HI NI” virus raised a worldwide alert and a lot of costumers try to avoid to go to affected areas.

Natural disasters like earthquakes or burning woods are also a major concern of tourism industry.

B. Constraints of institutional actors

The constraints of international actors will be the last part of the PESTEL, which means that we will talk about the Legal factor that could bother TUI.

The industries in which TUI operate and will operate are heavily regulated at a lot of levels by national regulators and especially by Europe. There are a lot of different regulations that can affect TUI:

- With the Aviation Safety and Regulations (2009) regulations, governments cover environmental, health and consumer issues and aviation permits, and all that under legal factor. This regulations impose significant costs on TUI’s business and could limit its flexibility with respect of its business practices.

- They have to be aware of the legal issues of different countries if they are acquiring or merging with other companies

- Especially after the merger with “Nouvelles Frontières” , French’s leading tourism operator, they will be well controlled by the government, who take care of the market of tourism and they don’t want any big monopolistic companies.

- Trade Laws also have an important impact on the world’s business.

C. Consideration of other stakeholders of the company (internal / external)

With almost 63 000 employees all over the world, relationships with employees, European and local work councils, trade unions and other employee representatives is an important part of TUI. Should these relationships be bad, there could be a risk to customer service and increased costs associated with industrial disputes. TUI’s management has also to be very effective and pay a lot of attention, because they have a direct impact on the operating results and on the financial performance.

TUI is also dependent on the provisions of services by the third party, such as hotel operators, airlines, suppliers of aircraft, aircraft manufactures and tour operators. If some of this parties are getting restricted or temporally halted (for example because of technical problems or strikes), it will have a bad effect on the business, financial conditions and results on TUI GmbH and it will also have a really bad effect on the costumers confidence in TUI.

Another problem for TUI is that they are really dependent to seasonal fluctuations, what means that they are making more profit during holiday seasons. Demand has historically been highest from November through to April and from May to October. During the other months, they have a particularly strong effect on TUI’s financial condition and results of operating.

IV. Segmentation strategic business

A. Segmentation criteria

To analyze the segmentation of tourism, we have to differentiate two different kinds of segmentations: the segmentation of the services provided by TUI and the segmentation of customers behavior.

- Segmentation of the service provided

TUI’s segmentation is composed by transportation, hosting and leisure.

The transportation segment is provided by TUI Travel and TUI Cruises, that transport costumers by plane and by cruises.

The hosting segment is provided by TUI Hotel and Resort, by offering over 240 hotels.

The leisure part is guaranteed by all of the sectors.

- Segmentation of customer’s behavior

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This graph shows the percentage of Americans that decide to travel, and this can be a good explenation of costumer’s behavoir when they travel.

There are 5 different type of travellers: - The adventurer: curious, active dynamic, wants to go to undeveloped and rarely visited areas…

- The conservative: research of routine nature, adventures, family attractions popular destinations, short visits…

- The Quasi-conservative: is less than the traditional conservative in travel habits.

- The Quasi-adventurous: he follows the trail of the adventurer, but it requires more services and comfort.

- The center (62%): he apreciates the developed areas, but not overcrowded. He likes to visit new destinations and is very active.

B. The key success factors of the segment

The key success factors of the segment are

- Cheaper price.

- Originality.

- Strong multichannel distribution focusing on online sales.

- A wide range of destinations.

- A wide range of destinations especially for the emerging country.

- The purchases of competitors

D. Environmental constraints and societal segment

- Environmental

The emission of CO2 is a major threat for the company because the climatic conditions in earth and aviation are a major contributor of CO2. The government wants people, especially in Europe, to take the train because the rail travel emission is only one-third of air travel.

The health problem is also an important environmental constrain for TUI and tourism in general. Viruses like for example the ”HI NI” virus raised a worldwide alert and a lot of costumers try to avoid to go to affected areas.

Natural disasters like earthquakes or burning woods are also a major concern of tourism industry.

- Sociocultural

The lifestyle of the costumers is very important and can influence TUI’s objectives. Nowadays, people have some other expectations and want special offers like for example holiday packages are online booking. It’s crucial for the group to be always up to date and anticipate these demands. But that needs a lot of time to analyze all of that.

Brand recognition is also a very important fact. A lot of people stay loyal to their brand and it will be very difficult to win costumers that are loyal to their competitors. That’s why it’s very important to provide some new offers and to be better that the competitors.

The changing of costumer’s way of life, especially the changing attitudes toward safety and the environment can also affect customers’ decisions. Costumers are getting more and more environment conscious and are more leaned to companies that offer an environmentally friendly policy.

E. Competitive strategies adopted by the company

There is a moderate competitive rivalry in the tourism industry. The two market leaders TUI and Thomas Cook own almost 40% of the whole market and it’s difficult for other, smaller companies to find their way.
That’s why it’s very important to be always up to date and to anticipate costumers demands. To maintain its leadership in the market, you also have to keep your structure attractive. TUI concentrated their market of tour operators in Europe with a staggering 21%. They also operate in more than 180 countries and serve more than 30 million customers and operate around 240 hotels with majority in 4 or 5 stars hotel category.

VI. Identification of the sectorial dynamic of the activity

A. The life cycle of sectors and markets

Tourism has become a popular global leisure activity. In 2010, over 940 million internatioal tourists from all over the word travelled, 6.6% more than in 2009.

In advances economies, tourism has maintained a strong and closing gap with emerging economies and raised 4.3%. This trend reflects the decrease of the Middle East and North Africa.

In 2011, all world regions showed positive trends with the exception of the Middle East and North Africa. Results were better than expected in Europe +6%, boosted by the recovery of Northern Europe +7% and Central and Eastern Europe +9%.

If we talk about the cycle of life of a product or service, we usually have this kind of graph

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(Graph: http://www.agmrc.org/business_development/getting_prepared/business_and_economic_concepts_and_principles/product_life_cycle.cfm)

But we can’t really use this graph because when we talk about the life cycle of tourism, we should not talk about the life cycle of a product, but we should talk about the life cycle of a destination. Therefore, we can use this graph to explain the life cycle of a tourism destination:

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(Graph: http://theses.univ-lyon2.fr/documents/getpart.php?id=lyon2.2005.kibicho_w&part=100760)

In the first two periods, the growth rate is increasing rapidly, while the consolidation phase corresponds to compaction. The growth rate becomes zero in the phase of stagnation. After this step, a tourist destination that does not renew itself and is doomed to disappear and therefore it finds another function.

It’s always uncertain, if the market will remain this growth and if they will increase considerably like the months before. Tourism is always dependent of many factors (refer to part IV and the PESTEL analysis) and a lot of external facts can affect the sales of TUI. They are also very dependent of holiday seasons and their economy of the country.

B. List of known business sectors

There is the list of all the business sectors of TUI. There is TUI Travel, TUI Hotel and Resort and TUI Cruises. On this graph, we can also see that TUI sold all their containers from Hapag-Lloyd, so they can concentrate on tourism.

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TUI Travel is devided in 5 different sectors:

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C. The life cycle of technology

To maintain their leadership on the market and not to see their services decreasing, TUI decided to accept responsibility and is committed to sustainable development and the protection of the environment and nature.
For the brands of TUI travel, they have a pro-active environmental protection and sustainable development as essential parts of the holiday and product quality.
The airlines of TUI Group are of the latest design and they all achieve a reduction in fuel consumption, in emission of CO2 and in aircraft noise. They put a lot of importance to technical innovation, fleet renewal and constant optimization of technical and operational processes.
Hapag - Lloyd Cruises work very close with the WWF and IAATO (especially for the ecologically sensitive regions), to get the greatest possible protection of the sensitive ecological systems.
TUI Hotels and Resorts work in sustainable development includes concrete measures in company internal environmental protection, nature conservation activities and more general work such as the cooperation with local communities for integrating the local economy and tourism

VII. Evaluation of internal resources and competitive activity:

A/ The Value Chain and competitive advantages:

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The full integration across the value chain of TUI is :

Primary activities:

• Distribution 10% • Tour operator30% • Airlines 30% • Destination services 10% • Hotels10%

Support activities: • Firm infrastructure • Human resources management

Comment on this percentages :

1 : Example of Price differences (TTC per person) for the same trip:

7 nights at the Taj Coral Reef with half board - Maldives - Departure from Paris - Scheduled flight Qatar Airways :

• Departure on 07/15/2007>> € 1890 with TUI and € 2251 with Jet Tours>> € 361 • Departure on 02.09.2007>> Jet Tours € 1911 and € 2390 with TUI>> € 479

This figures shows us that Tui has always the best prise.

The prises is cheap because Tui has its own low cost company :

▪ TUI airline already has seven companies in 9 European countries, including several low-cost reputations. ▪ TUI is the fifth largest European carrier. ▪ TUI fly-out is the first team in Europe.

▪ TUI airlines are all independent companies within the Group, directly operated by it or through its partners. Synergies are maximized by sharing management systems: fleet management, handling, flight operations through its "General Operation Center", engineering, logistics and spare parts management.

It is important to know that TUI do not do these services That why TUI flight or Trips are cheap:

• The journey is itself devoid of any assistance in case of default: on-booking hotel, hotel does not comply, flight Delay, missed correspondence... • There is no assistance in case of problem.

Tui spread throughout the value chain by vertical integration and this made TUI deliver better value at cheaper price.

B/ Mapping strategic competitors:

TTour

Comment :
Thomas cook is the only direct competitor who is doing the same services as TUI:
Journeys, circuit, flight, hotels,etc…

Club med and Company low costs can be competitor, but it is an indirect, this 2 market does not offer the same services as Thomas Cook or TUI, but they can offer cheap prices for flight (company low cost) and more complete and diverse choice of journeys (club med)

C/ SWOT analyses:

| |WEAKNESS |
|STRENGH | |
| | |
|TUI spread throughout the value chain by vertical integration and this made |The company registered a net loss of EUR 142 million in 2008(annual report |
|TUI deliver better value at cheaper price. |2008) |
| | |
|Market leader in the tourism industry. |Major reduction in the volume of the holiday package because of recession |
| |and |
| |Competition in this sector is very intense. |
|Strong multichannel distribution focusing on online sales. | |
| |Low cost companies have a negative image, because of it bad service. |
|A wide range of destinations. | |
| |People travelled less because of the inflations and the economic crises. |
|An increasing demand especially for the emerging country. | |
| |Focusing on online sales cannot attract senior people, who can offer more |
|Thanks to the purchases of competitors, a monopoly in the sector. |than the young people journey. |
| | |
| | |
| | |
| | |

D/ SWOT analyses:

| |TREAT |
|OPPORTUNITIES | |
| | |
|A strong reputation in many countries. |Changing consumer behaviour in this
global economic recession can |
| |influence
company’s strategy. |
|An increasing demand of destination especially for the emerging | |
|country: china, Thailand etc... |The tendency of customers to switch on
to rail and bus for |
| |short-haul travels could
be a backlash to TUI’s reliance on |
|Customers are loyal to the brand with its quality and reputation. |air
travel. |
| | |
|Young people like to travel during short holiday. |Threat of losing consumers who opt low-
cost packages because of |
| |company’s
focus on 4-star hotels. |
|Behaviour of consumer have changed, people book and organized their | |
|holiday’s last minute. |Because of some political and economic issues some destination are |
| |less attractive than before : |
|People travelled in WE, with all the attractive prices, people want |Tunisia (political) Egypt (political) Greece(economic) |
|to have a trip break during their week. | |
| |The rising of the prices of the fuel. |
|TUI has many facilities to do reservation, a website very | |
|attractive. |Taxation about the environment. |
| | |
|Buy on line, is very interesting for busy people. No need to waste | |
|time to go to the agency. |This market is affected by the rude concurrence, people who like |
| |surfing on website prefer to buy ticket flight and hotels with the |
|Expansion in developing markets such as India and China. |cheapest price. |
| | |
| | |
|Business expansion through further | |
|Acquisition and merger | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |

E/ Corporate social responsibility: Tui is a globally active company, TUI is aware that its social activities within the value added chain on a local, regional and global scale have consequences on the biological diversity.
At the same time, the tourism sector is immoderately dependent on an intact nature and environment. Since the early of 90s TUI has been committed to concrete projects and cooperation agreements with scientific, political and nature conservation organisations to protect biodiversity.
The strategic objective of the TUI Group is to continuously “attach value” to biodiversity as a natural resource in holiday destinations and as the nature.
The TUI Biodiversity Strategy includes the continuous execution of several measures:

• Consideration of international agreements and conventions on the protection of nature and species (e.g. Convention on International Trade in Endangered Species of Wild Fauna and Flora, CITES)

• Support of a mulit-level conservation area policy in holiday destinations to provide clearly defined regulations for the protection of biodiversity (e.g. the European Charter for Sustainable Tourism in Protected Areas of the EUROPARC Federation)

• Campaigns in holiday destinations on the protection of species to raise the awareness of guests and local people (e.g. cross-company initiatives such as the “Year of the Dolphin” in cooperation with UNEP and the Convention on the Conservation of Migratory Species of Wild Animals (CMS))

• Cooperation projects with scientific and research institutes (e.g. the scientific case study “Wildlife Watching and Tourism” in cooperation with scientific organisations)

• Active environmental consultancy and collaboration with experts (e.g. basic value paper for the protection of biodiversity)

• Cooperation with NGOs to support local species conservation initiatives (e.g. support of the NGO "Archelon" campaign for the protection of sea turtles)

• Sensitization of customers to encourage their responsible interaction with flora and fauna in the holiday destinations (e.g. information in brochures, hotel information material and in the internet)

• Sensitization of employees (e.g. by regularly providing environmental information in internal media or as a module in company training)

F/ The company and its market :

VIII The coherence of the business portfolio

A/ Matrix BCG

B/ MATRICE BCG de l’entreprise

ger

IX. Analysis of the competitive environment:

A/ Demand Analysis:

Costumers:

|Criteria |Example |
|Socio-demography | |
| |18-50 years old |
| |Both sexes |
| |Families |
| |Single |
| | |
|Economic |Medium and upper Class |
|Geography |Developed countries: Europe, America |
| |Emergent countries: China |
|Buy behaviour |Buy by internet |
|Psycho-social or personnel life style |People who like discovering other cultures, people who likes travelling. |

The absolute non-consumers: ▪ The persons who can not have access to internet ▪ The persons who have not the habit to buy by internet (old people) ▪ The blind people

The non-consumer related: ▪ People who are afraid to take the plane and prefer train. ▪ People who like to organise their own destination (preference of hotels etc.)

Numbers of costumers: ▪ More than 30 millions Customer in over 27 source Markets.

B/ Analysis of supply:

| |+ Positive |– Negative |
|Concurrence | | |
|Tour operator |Leader in it market |Thomas cook, is the most concurrence in this |
| | |market. |
|Oligopole |Target of upper class, rich people. |No diversifications in hotel, TUI offer 4**** |
|Hotels | |hotels |
|Monopole |The cheapest prices in the market. |Bad services with low cost company |
|Airlines | | |

C/ Finding the equilibrium price between supply and demand:

The prices between supply and demand is in equilibrium situation, In Fact the demand is in stagnation and the offer is increasing, TUI is trying to develop its tourism:

For example: ▪ In the summer 2011, TUI offers 12 different Circuit, in every continent. ▪ In September 2011, TUI has bought a ship in order to develop it cruise tourist.

The prices between supply and demand is in stagnations, TUI have its own strategies of target which is the upper class, so we can say tat the prices in the future will rises because TUI is developing a strategy of high –luxury Brand.

D/ Competitive Analysis:

▪ Thomas Cook Group:

This the first competitor, and I think the most dangerous, Thomas cook is a company which was created in 1841, by Thomas Cook, at the beginning it was a company to assure the transport by train to the Great Exhibition of 1951, then the company start to develop, first in Europe, in 1855 then 10 years later in USA. The company has increased and still increasing.

Thomas Cook has it own company of travels and has:

▪ More than 3400 agencies ▪ 31 000 employees ▪ 21 markets ▪ 22.5 million customers ▪ 95 airplanes

Thomas Cook has a partner with this airlines : ▪ Lufthanza ▪ Condor ▪ Sun express

Thomas cook is the only direct competitor with TUI.

The market situation :
The tourism sector accounted for 685,783,133 euros in 2001, an increase of 187% over 1997. This growth is related to the recent expansion of operator tour, like TUI, which offer packages at competitive prices. ▪ The number of travel agencies and TO has increased by 50% since 1997. ▪ Sales growth of travel agencies and TO are phenomenal since it reaches 301% over 1997. The most notable trend is that of packages (up 423%, 53% of total tourism market in 2001). ▪ Sales of tickets have also been developed (increase of 222%, 32% of the market in 2001) but their share has declined with the growth packages. The accommodation, insurance and other services have also increased in volume but together they account for only 15% of the market in 2001 (against 20% in 1997).

▪ Trip on the Mediterranean coast and Adriatic are the most sold (Italy, Tunisia, Spain, Greece, France, Portugal, Croatia, Turkey and Israel). Weather conditions are part of their main concerns. The distance from the beach to the hotel is also essential. Stays "beach" 54% of total sales in 2001. ▪ Cultural destinations are still the second largest source of sales. ▪ The losing ground against the popularity of packages "beach". ▪ There is also the success of the holiday in the mountains.

CONCLUSION

The Strategy (or the objectives set by policy makers of its structures to sustain the activity)?

The strategy of TUI is to maintain its position of leader in its market. In thinking of this study we have noticed with many information that TUI is going to target richer population. ▪ the bought of a new the sheep very luxury ▪ as well the offer of just 4 and 5 stars hotels

I think this is the strategy to be different from Thomas cook. If TUI will be in the Luxury travelling market, it is going to be the only Tour operator who has this services and this reputation.

Moreover, TUI in 2010 has it first implantation in Russia and ▪ Russia is known by its rich category of population who are very attractive to the luxury market.
TUI as well wants to develop in China, ▪ In China as well the rich populations is increasing.

The strategy of TUI is to keep its position of leader in this market and as well to be the first operator tour Luxury services.

But the only services which TUI should change to offer more luxury services, is its offer for the airplanes, for the moment is just low cost charter company.
May be the strategy of TUI is to be in the luxury of cruise, then they will move to the other segment.

Is there diversification seen in the context of this strategy (possible) result of this implementation?
No, why? Justify.

No, because TUI always tries to diversify their services and destinations. They don’t have to diversify their strategy because their strategy is already diversified and they are always up to date with customer’s expectations and behaviors.

What (s) impact (s) is / are feasible (s) on supply, demand, the market environment?

The impact on supply is that TUI will offer more destinations in other countries and that the group will especially focus on the luxury market.

The impact on the demand will be that the group will maintain their costumers and maybe gain some more, thanks to the new destinations.

The impact on the market environment will be that TUI probably maintains the leadership on the market and will acquire some other companies from other continents, to be more present there.
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2011-2012

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Thomas Cook

Club med and other tourism company
(indirect)

Low cost companies
(indirect)

Secondery market :

• Hotels • circuit

Main market :

• Tour operator • Travelling

Market support :

• Air planes • Ships • Cruise

Substitution market : • Camping • Hiking • Cayac and water • Climbing

Generic market
The environment :

• Leissure of travelling • Discovery of new cultures

STAR :

Balance betwe[pic][?] 89:;=>BCDEFSìâÕ˾¬š?ƒâuâhZÕM17hen need and excess resources €

Goal: To maintain and enhance

• Tour operator • Airlines

QUESTION MARK :

Require resources in €

Purpose: building, segmentation, abandonment

• Hotels ( TUI propose more 4 stars, more divesifications)

DOG :

Balance between need and excess resources €

Purpose:

• Make presence in road

CASH COWS :

€ surplus resources (in principle)

Goal: To maintain

• Distribution • Destination services

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Air lines :
Low cost but good services

Hotels
More diversification

Devellopement in new countries

Tour operator
Air lines

[pic]

[pic]

Make presence in road