Examination Paper: Hospitality Management
4
IIBM Institute of Business Management
IIBM Institute of Business Management
Examination Paper MM.100
Hospitality and Tourism Marketing
Section A: Objective Type (30 marks)
•This section consists of Multiple choices/Fill in the blanks/True-False and short notes type
questions.
•Answer all the questions.
•Part One questions carry 1 mark each and Part two questions carry 5 marks each.
Part One:
Multiple Choices:
1. In SMERF, ‘S’ stands for:
a. Social
b. Service
c. Sale
d. None of the above
2. If the Question Mark businesses are successful then they become Stars.(T/F)
3. Customers can be considered under:
a. Micro environment forces
b. Macro environment forces
c. None of the above
d. depending on the area of consideration any of the above
4. Demography is the study of………………………………………………………………………
5. Generation X consist of the people born between:
a. 1946 to 1964
b. 1965 to 1976
c. 1977 to 1994
d. None of the above
6. In ‘SMERF’ M stands for:
a. Money
b. Model
c. Military
d. Market
7. Aural dimensions of environment are volume and pitch.(T/F)
Examination Paper: Hospitality Management
5
IIBM Institute of Business Management
8. NAM stands for:
a. National Account Management
b. National Accounting Market
c. National Autonomous Market
d. Both (a) & (b)
9. Fixed costs are also known as ‘Overheads’.(T/F)
10. Lobbying is dealing with legislators and government officials to promote or defeat legislation and
regulation.(T/F)
Part Two:
1. What do you understand by ‘Hospitality Marketing’?
2. Write a note on ‘Servuction model’.
3. What are ‘Cash Cows’?
4. What do understand by ‘Vertical conflict’ in case channel behavior?
END OF SECTION A
Section B: Caselets (40 marks)
•This section consists of Caselets.
•Answer all the questions.
•Each Caselet carries 20 marks.
•Detailed information should form the part of your answer (Word limit 150 to 200 words).
Caselet 1
International Travel Agency
The president of International Travel Agency was concerned about the performance of the sales force.
It was felt that members of the sales force did not really utilize their sales opportunities, but instead
though only about selling a ticket to a customer from point A to point B. The sales force did not seem
to have an interest in maximizing sales and profits by aggressively selling the entire product mix. In
total, the agency had a sales force of eight. Three members of the sales force were referred to as
executive sales consultants. These people called on commercial accounts and were expected to spend
more of their time outside the office. The remaining five persons were referred to as travel counselors
and worked entirely within the agency. None of the travel counselors who worked within the agency
were assigned a quota. The executive sales consultants, who worked outside the office, were assigned
a sales quota. Failure to meet a quota would be discussed with the salesperson, but no other action
was usually taken unless this failure continued for several months. If serious and persistent
Examination Paper: Hospitality Management
6
IIBM Institute of Business Management
deficiencies existed, the salesperson could be subject to discharge. The agency provided nine to
twelve familiarization (fam) trips for members of the sales force each year. This meant that each
salesperson could experience at least one trip per year, as they were assigned on a rotating basis.
These trips did not reduce time from the salesperson’s guaranteed number of days of annual vacation.
The purpose of a fam trip was to acquaint travel agents with destination areas and the services of
airlines, hotels, restaurants, and so on. The president felt that the agency could maximize profits by
selling more travel services to clients and that the sales force was concerned only about selling
tickets. An analysis of the product mix of International Travel revealed that approximately 85 percent
was accounted for by airline tickets. The remaining 15 percent consisted of allied travel services,
including hotels, rental cars, and entertainment. Of these, the majority consisted of hotel reservations.
Less than one percent was accounted for by the sale of traveler’s checks. One of the members of
management offered the analogy of a businessman entering a clothing store. If a customer purchases a
suit, the salesclerk asks if the customer might need a new shirt or tie to go with the suit. Travel agents
are no different. They write a ticket from Chicago to Hong Kong or London for a client and never
bother to ask if the client needs hotel accommodations, rental cars, travelers checks, or other services
that an agency handles. The president of International Travel had tried to encourage the sales force to
sell other services but felt that they seemed uninterested in taking the time and effort required. The
president believed that maximizing sales of the complete product mix would lead to maximum profits
and that something must be done to encourage cross-selling.
Questions:
1. What can be done to encourage the sales force to engage in more cross-selling?
2. Discuss what is needed in terms of sales incentives and sales controls to achieve the objectives of
International Travel Agency.
Caselet 2
TANGLEWOOD PARK: VANTAGE GOLF TOURNAMENT
Tangle wood Park has a budget of $4.8 million per year and golf is the primary moneymaker for the
park, but over the past four years, Tangle wood has steadily lost money on its golf greens. In 1994,
golfers paid about $1 million to play on the championship course where the Vantage is held.
However, the amount of maintenance needed to keep this course in top shape and the loss of revenue
when the course is shut down for repairs have created an economic problem. The general public who
pays county taxes has been restricted from the greens to ensure that the course will be in shape for the
Vantage tournament. Revenue from the championship course was expected to be $428,000 less in
1997 than in 1994. “We’re trying to product our investment,” said Rich Schmidt, finance officer for
the park. The dilemma is that golfers who are viewed as “big-buck spenders” want to play where
the pros play, said Francie Bray, director of marketing for the park. How much does the county get
from these players and the thousands of visitors who attend the three-day tournament? Nobody
knows! Officials with the Country Tourism and Development Authority don’t know and neither do
officials of the tournament, but most are from Forsyth and surrounding counties. So its doubtful that
these people add much revenue to the county. They don’t stay in hotels or make extra trips to the
restaurant as a result of the tournament. Many observers feel that the only real spenders are the 500
people directly associated with the Vantage. That includes golfers, caddies, guest, and the media, said
Richard Habeggar, tournament director. John Wise, general manager of the Adam’s Mark Hotel in
nearby Winston-Salem, said he expects some of the 615 rooms to be filled with tournament guests,
but when asked how much the tournament helped, he said, “That’s tough to say. If we didn’t have the
Examination Paper: Hospitality Management
7
IIBM Institute of Business Management
Vantage, we’d attract business from other events.” An official from the Ramada Inn said that the 147
rooms for the tournament period were booked, but some had been sold to people attending weddings.
Despite a budget of $3 million by R.J. Reynolds to sponsor the Vantage, the company started the
1996 tournament with a $250,000 deficit. Tournament officials have noticed a slump in ticket sales
and cut expenditures by airing the event on the Golf Channel rather than ESPN, which broadcast the
event for ten years. Pete Brunstetter said he wasn’t certain of the future for the tournament but said
that the county couldn’t help to subsidize it. The lack of reliable statistics concerning the economic
advantages of the tournament to the county and to the local visitor industry undoubtedly hurt. Elected
officials responsible for the careful expenditure of tax money and professional managers of a county
public park must support their decisions. The absence of reliable data makes it nearly impossible to
mount a defense the public will accept.
Questions:
1. The county commissioners need information to make a decision on the golf tournament. Using
the marketing research process, develop a research plan that will provide the commissioners with
the information they need.
2. Explain why it is important on the economic contribution of social events, both before and after
the event.
END OF SECTION B
Section C: Applied Theory (30 marks)
•This section consists of Applied Theory Questions.
•Answer all the questions.
•Each question carries 15 marks.
•Detailed information should form the part of your answer (Word limit 200 to 250 words).
1. A “hot” concept in fast-food marketing is home delivery of everything from pizza to hamburgers
to fried chicken. Why do you think the demand for this service is growing? How can marketers
gain a competitive advantage by satisfying the growing demand for increased services?
2. Identify a restaurant or hotel market segment in your community that you feel would be a good
market segment to target. Explain the marketing mix you would put together to go after this
market segment.
END OF SECTION C
S-2-210311
4
IIBM Institute of Business Management
IIBM Institute of Business Management
Examination Paper MM.100
Hospitality and Tourism Marketing
Section A: Objective Type (30 marks)
•This section consists of Multiple choices/Fill in the blanks/True-False and short notes type
questions.
•Answer all the questions.
•Part One questions carry 1 mark each and Part two questions carry 5 marks each.
Part One:
Multiple Choices:
1. In SMERF, ‘S’ stands for:
a. Social
b. Service
c. Sale
d. None of the above
2. If the Question Mark businesses are successful then they become Stars.(T/F)
3. Customers can be considered under:
a. Micro environment forces
b. Macro environment forces
c. None of the above
d. depending on the area of consideration any of the above
4. Demography is the study of………………………………………………………………………
5. Generation X consist of the people born between:
a. 1946 to 1964
b. 1965 to 1976
c. 1977 to 1994
d. None of the above
6. In ‘SMERF’ M stands for:
a. Money
b. Model
c. Military
d. Market
7. Aural dimensions of environment are volume and pitch.(T/F)
Examination Paper: Hospitality Management
5
IIBM Institute of Business Management
8. NAM stands for:
a. National Account Management
b. National Accounting Market
c. National Autonomous Market
d. Both (a) & (b)
9. Fixed costs are also known as ‘Overheads’.(T/F)
10. Lobbying is dealing with legislators and government officials to promote or defeat legislation and
regulation.(T/F)
Part Two:
1. What do you understand by ‘Hospitality Marketing’?
2. Write a note on ‘Servuction model’.
3. What are ‘Cash Cows’?
4. What do understand by ‘Vertical conflict’ in case channel behavior?
END OF SECTION A
Section B: Caselets (40 marks)
•This section consists of Caselets.
•Answer all the questions.
•Each Caselet carries 20 marks.
•Detailed information should form the part of your answer (Word limit 150 to 200 words).
Caselet 1
International Travel Agency
The president of International Travel Agency was concerned about the performance of the sales force.
It was felt that members of the sales force did not really utilize their sales opportunities, but instead
though only about selling a ticket to a customer from point A to point B. The sales force did not seem
to have an interest in maximizing sales and profits by aggressively selling the entire product mix. In
total, the agency had a sales force of eight. Three members of the sales force were referred to as
executive sales consultants. These people called on commercial accounts and were expected to spend
more of their time outside the office. The remaining five persons were referred to as travel counselors
and worked entirely within the agency. None of the travel counselors who worked within the agency
were assigned a quota. The executive sales consultants, who worked outside the office, were assigned
a sales quota. Failure to meet a quota would be discussed with the salesperson, but no other action
was usually taken unless this failure continued for several months. If serious and persistent
Examination Paper: Hospitality Management
6
IIBM Institute of Business Management
deficiencies existed, the salesperson could be subject to discharge. The agency provided nine to
twelve familiarization (fam) trips for members of the sales force each year. This meant that each
salesperson could experience at least one trip per year, as they were assigned on a rotating basis.
These trips did not reduce time from the salesperson’s guaranteed number of days of annual vacation.
The purpose of a fam trip was to acquaint travel agents with destination areas and the services of
airlines, hotels, restaurants, and so on. The president felt that the agency could maximize profits by
selling more travel services to clients and that the sales force was concerned only about selling
tickets. An analysis of the product mix of International Travel revealed that approximately 85 percent
was accounted for by airline tickets. The remaining 15 percent consisted of allied travel services,
including hotels, rental cars, and entertainment. Of these, the majority consisted of hotel reservations.
Less than one percent was accounted for by the sale of traveler’s checks. One of the members of
management offered the analogy of a businessman entering a clothing store. If a customer purchases a
suit, the salesclerk asks if the customer might need a new shirt or tie to go with the suit. Travel agents
are no different. They write a ticket from Chicago to Hong Kong or London for a client and never
bother to ask if the client needs hotel accommodations, rental cars, travelers checks, or other services
that an agency handles. The president of International Travel had tried to encourage the sales force to
sell other services but felt that they seemed uninterested in taking the time and effort required. The
president believed that maximizing sales of the complete product mix would lead to maximum profits
and that something must be done to encourage cross-selling.
Questions:
1. What can be done to encourage the sales force to engage in more cross-selling?
2. Discuss what is needed in terms of sales incentives and sales controls to achieve the objectives of
International Travel Agency.
Caselet 2
TANGLEWOOD PARK: VANTAGE GOLF TOURNAMENT
Tangle wood Park has a budget of $4.8 million per year and golf is the primary moneymaker for the
park, but over the past four years, Tangle wood has steadily lost money on its golf greens. In 1994,
golfers paid about $1 million to play on the championship course where the Vantage is held.
However, the amount of maintenance needed to keep this course in top shape and the loss of revenue
when the course is shut down for repairs have created an economic problem. The general public who
pays county taxes has been restricted from the greens to ensure that the course will be in shape for the
Vantage tournament. Revenue from the championship course was expected to be $428,000 less in
1997 than in 1994. “We’re trying to product our investment,” said Rich Schmidt, finance officer for
the park. The dilemma is that golfers who are viewed as “big-buck spenders” want to play where
the pros play, said Francie Bray, director of marketing for the park. How much does the county get
from these players and the thousands of visitors who attend the three-day tournament? Nobody
knows! Officials with the Country Tourism and Development Authority don’t know and neither do
officials of the tournament, but most are from Forsyth and surrounding counties. So its doubtful that
these people add much revenue to the county. They don’t stay in hotels or make extra trips to the
restaurant as a result of the tournament. Many observers feel that the only real spenders are the 500
people directly associated with the Vantage. That includes golfers, caddies, guest, and the media, said
Richard Habeggar, tournament director. John Wise, general manager of the Adam’s Mark Hotel in
nearby Winston-Salem, said he expects some of the 615 rooms to be filled with tournament guests,
but when asked how much the tournament helped, he said, “That’s tough to say. If we didn’t have the
Examination Paper: Hospitality Management
7
IIBM Institute of Business Management
Vantage, we’d attract business from other events.” An official from the Ramada Inn said that the 147
rooms for the tournament period were booked, but some had been sold to people attending weddings.
Despite a budget of $3 million by R.J. Reynolds to sponsor the Vantage, the company started the
1996 tournament with a $250,000 deficit. Tournament officials have noticed a slump in ticket sales
and cut expenditures by airing the event on the Golf Channel rather than ESPN, which broadcast the
event for ten years. Pete Brunstetter said he wasn’t certain of the future for the tournament but said
that the county couldn’t help to subsidize it. The lack of reliable statistics concerning the economic
advantages of the tournament to the county and to the local visitor industry undoubtedly hurt. Elected
officials responsible for the careful expenditure of tax money and professional managers of a county
public park must support their decisions. The absence of reliable data makes it nearly impossible to
mount a defense the public will accept.
Questions:
1. The county commissioners need information to make a decision on the golf tournament. Using
the marketing research process, develop a research plan that will provide the commissioners with
the information they need.
2. Explain why it is important on the economic contribution of social events, both before and after
the event.
END OF SECTION B
Section C: Applied Theory (30 marks)
•This section consists of Applied Theory Questions.
•Answer all the questions.
•Each question carries 15 marks.
•Detailed information should form the part of your answer (Word limit 200 to 250 words).
1. A “hot” concept in fast-food marketing is home delivery of everything from pizza to hamburgers
to fried chicken. Why do you think the demand for this service is growing? How can marketers
gain a competitive advantage by satisfying the growing demand for increased services?
2. Identify a restaurant or hotel market segment in your community that you feel would be a good
market segment to target. Explain the marketing mix you would put together to go after this
market segment.
END OF SECTION C
S-2-210311
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