GSBS6041 Global Marketing Strategy and Planning Management

a) the research conducted on the chosen company and the UK market must be undertaken individually, not in pairs or groups; similarities in style and sequence of the information presented will be closely scrutinised;

 

b) use of blogs, Wikipedia, QuickMBA and any other essay writing websites is explicitly forbidden;

 

c) as indicated in the attached marking grid, you are expected to use information from a range of reliable and high quality sources;

 

d) all information obtained – whether from paper-based or electronic sources – must be freely available to any researcher and clearly & accurately referenced;

 

e) any use of purchased, commissioned or other forms of research undertaken by a third party, whether of a secondary or primary nature, is also explicitly forbidden;

 

f) you must NOT for any reason contact your chosen company, either directly or indirectly;

 

g) where sources used are originally in languages other than English, their content must be presented in English.

Introduction:

Thomas Cook is the company that operates in the tours and travel industry. This firm has its functions in all over UK and the parts of Ireland. This reports aims at analysing the macro and micro environment of the company in UK to identify the factors and their impact on the company's functioning and operations.

Macro environmental analysis:

PESTLE analysis:

This is the model that has been used to analyse the different environmental factors and their impact on the company’s functions (Pulver, 2012). The factors that have been discussed are political, economic, social, technological, environmental and legal.

Political factors: Government has the great influence and interference in the tours and travel industry (Srdjevic, Bajcetic and Srdjevic,  2012). The imposition of tourism tax by the UK government has affected the business of all the companies in the industry including the business of Thomas Cook. One of the taxes that is the bedroom tax has also been imposed by the government of UK was highly opposed by all the travel agents. This tax is levied by the government in order to increase the price at domestic level on the local staying. This helps the country to keep the foreign visitors in UK.

Economic factors: Tours and travel is the industry that has not only being affected by the local country’s economy but also gets affected by the fluctuation in the economy of other countries. It has been analysed that from the last few years, the country is facing. There are factors such as unemployment rate which is increasing in UK, the terrorism factor and the consumer’s disposable income that affect the travel industry along with the company called Thomas Cook. Due to these factors, the travel industry in UK is shaking from its path (Walton,  2010).

Social factors: As far as the disposable income of the country is considered, it has been analysed that the income is rising for large sector of people in the country (Moutinho,  2011) . Increase in disposable income allows the people to go for holidays and thus require the need for more and more travel agents to serve the customers. The presence of low cost carriers such as Easy Jet and Ryanair also supports the travel industry in UK.

Technological factors: Improvement in social media and internet services proved to be a boon for the travel industry (Craig and Campbell, 2012) . This is because the people, these days believes in boking the hotels, flights and holiday packages online only. The travel agents can also reach to the mass customers or audience with the help of internet or online mediums. Thomas Cook is the company that is also serving the customers online but aims at improving its services.

Environmental factors: Environment protection is the major concern of every industry these days. The travel industry can directly des not contribute in the sustainability of the environment but can contribute with the help of aviation industry. 2% of the total greenhouse emission takes place from the aviation industry and thus it is required for the industry to develop the places that cause less harm to the environment.

Legal factors: The major factors in concerned with the legal aspect in UK are BREXIT. BREXIT is affecting all the businesses in the country in positive as well as negative way. The free trade between UK and US after BREXIT may help the country and the companies like Thomas Cook to attract more and more customers. However, leaving the European Union may also results in less tourism from other member of European Union in UK (Black, 2010).

Micro environmental analysis:

SWOT analysis:

SWOT analysis of the company helps in analysing the internal strength and weakness of the company and the opportunities and threats prevailing in the industry for the company (Pahl and Richter, 2007).

TOWS matrix:

TOWS matrix is the variation of the swot analysis. This matrix also allows knowing about the relationship between the strength, weakness, opportunities and threats of the company.

Industry analysis:

Porter’s 5 forces:

This model of analysis helps in analysing the industry of the company in which it operates. This helps the company to know its position in the market (Porter, 2008).

Threat of rivalry: High

As the tours and travel industry in UK is very much saturated so the threat from the competitors for Thomas Cook is very high. The major competitors are Cox and kings, Emirates, Tui travels etc.

Threat of substitutes: Moderate

Threat of substitute is moderate n nature as it is mandatory for the people to contact the travel agent for planning the foreign trips. However, the improvement and technology and easy access to internet helps the customers to make their own packages by contacting the foreign hotels directly at low prices and this affect the business if travel companies like Thomas Cook.

Threat of new entrants: low to Moderate

The threat of new entrant is low to moderate for Thomas Cook because the companies need to invest large capital to enter the industry and Thomas Cook has a great brand image in the market which is hard to compete for the new entrant (Goodall and Ashworth, 2013) .

Bargaining power of suppliers: Moderate to High

As more and more people have internet access these days so, most of the people book their hotels and flights through online sites of the companies. This results in reduction of travel agency business. The hotels or the airlines who act as the suppliers have the power to bargain in that case.

Bargaining power of buyers: High

The switching cost for the customers in this industry is very low and thus people can easily switch to other company if they get better offers. Thus, the bargaining power of buyers is very high.

Conclusion:

It has been concluded rom the report that Thomas Cook is one of the leading travel agency in the world. Macro environment analysis suggests that the government interference by imposing taxes on the industry is affecting the business of Thomas Cook in negative way. SWOT analysis helps in analysing the strength and weakness of the company that can used to explore the opportunities and minimize the threats detected. TOWS matrix provides the great relationship between all the factors of SWOT. The last section of porter’s analysis suggests that the company has to make strategies in order to deal with the smaller companies in the industry and have to reduce it operating cost.

References:

Black, J., 2010. The British and the Grand Tour (Routledge Revivals). Routledge.

Craig, T. and Campbell, D., 2012. Organisations and the business environment. Routledge.

Goodall, B. and Ashworth, G. eds., 2013. Marketing in the Tourism Industry (RLE Tourism): The Promotion of Destination Regions. Routledge.

Helms, M.M. and Nixon, J., 2010. Exploring SWOT analysis–where are we now? A review of academic research from the last decade. Journal of strategy and management, 3(3), pp.215-251.

Help & Support | Thomas Cook., 2017. Support.thomascook.com. Retrieved 22 July 2017, from https://support.thomascook.com/?website=thomascook/&_ga=2.213219217.409696802.1500706625-815451102.1500706621#intcmp=TopNav_CustomerSupport

Moutinho, L. ed., 2011. Strategic management in tourism. Cabi.

Pahl, N. and Richter, A., 2007. SWOT Analysis. Idea, Methodology And A Practical Approach.

Porter, M.E., 2008. The five competitive forces that shape strategy. Harvard business review, 86(1), pp.25-40.

Pulver, S., 2012. Business and the Environment.

Srdjevic, Z., Bajcetic, R. and Srdjevic, B., 2012. Identifying the criteria set for multicriteria decision making based on SWOT/PESTLE analysis: a case study of reconstructing a water intake structure. Water resources management, 26(12), pp.3379-3393.

Walton, J.K., 2010. Thomas Cook: image and reality. Giants of tourism, pp.81-92.

Weihrich, H., 1982. The TOWS matrix—A tool for situational analysis. Long range planning, 15(2), pp.54-66.