Virgin Galactic Space Tourism Marketing Plan
In this report, as a marketing advisor to VGA, I will discuss about the following topics: Developing a marketing communications plan for VGA; How can VGA become truly customer focused; The importance of minimizing cognitive dissonance in the minds of target customers;
1 – Marketing communications Plan. Illumination many years, space activities have been considered to be developed and managed by the government for the purpose of research or military only.
Nowadays, space traveling has been commercialese to fulfill the dreams of human to see the Earth from space. Virgin Galactic (VGA) is one of the few pioneers available in the market. As this is a totally new market, and VGA is also a new business of the Virgin Group, it is crucial to develop a complete marketing communications plan so that customers can get to know VGA and its services better. Market segmentation should be done before the communications plan to identify the target customers.
L. Marketing communications plan. Market segmentation (target audience)let is obvious that target customers of space tourism are high income individuals. VGA is now the only company offering the most competitive price ($200,000/passenger/time). However, it is still very expensive for the general public. Therefore, space tourism can be considered a niche market because it Just targets a small segment of the market but very profitable.
The target customers of space tourism should have a certain level of high income as he minimum charge for one passenger is IIS$200,OHO. Therefore, target customers should have a minimum annual household income of IIS$250,OHO or a minimum of IIS$I million net worth. According to the Space Tourism Market Study & Survey by Futon Corporation in October 2002 (Appendix 1), the age of potential customers are from 30 to 65+ years old because they are more likely to afford the high costs of the trips and interested in “once in a lifetime” experience.
VGA should also target space magazines readers, or those who are into risky activities such as skydiving, mountain climbing, sailing… Cause they are into space and willing to take risks. Potential customers are those from developed countries with Virgin Galactic Space Tourism Marketing Plan By endings Executive Summarizing Galactic (VGA), which is a part of the Virgin Group, is a leading company and pioneer in Suborbital Travel Industry. By offering the lowest n g GAP such as U Japan…
These people nave annual vacations and are willing to spend more money for their holidays. Therefore they are more likely to be interested in space tourism.
B. Objectives. Objectives of this marketing communications plan are to deliver the sage to the target customers:
The general public acknowledge Bag’s existence; customers have more information about VGA and its business; Attract potential customers to visit our website and our showroom; organize trade fairs, events for Public Relations; persuade customers to buy the service.
C. Message strategy and selling pointiest message focuses on VGA is currently the pioneer in counterclaiming space tourism with the lowest price on the market. The following selling points should also be and experienced in aviation industry;
Pioneering space traveling company;
Successful Spaceship One munch;
Lowest price in space tourism industry;
Communication channels and media
Advertise on magazines: As VGA does not sell commodity products but only targets a niche market, advertising on newspapers or TV can be unnecessary. Read about disadvantages of Space tourism
In order to target the potential customers (as mentioned under market segmentation), advertising on magazines such as space magazines to reach those who are interested in space and space tourism, or Time, Newsweek to reach wealthy businesspeople.; TV programmed: Being seen on television is the best way for people to get to know bout VGA and what the company is doing. We can work with famous television channels such as National Geography, Discovery Channel or BBC to produce some programmed about VGA activities, successful Spaceship One launch, how safe the operation is, etc…
It will surely have a great impact on customers’ minds.; Billboards is also another way to draw people’s attention, but it might not be be as effective because the message might not reach the target customers.; On the interpreter are many websites dedicated to space topics such as space.Com, spacecrafts.Com, etc. Which have a lot of readers and members. Advertising on these websites can link potential customers to our homepage. Ii)Public relations and events; Famous “flyer”let is the best way to draw attention if we have famous people, for example Hollywood celebrities, to participate in our flights.
Hollywood is a very potential market for VGA because the people are rich and willing to experience space traveling. ;Trade shows and exhibitioner’s aviation trade shows and exhibitions are the opportunities for VGA is reach its customers. It is a chance to show our work to the public and we can arrange seminar to give customers more information. Test flightiness’s One is a success of VGA to gain the public confidence. We are developing and going to launch Spaceship Two. We should look tort volunteers or famous scientists, Nobel prize winners, etc. To participate in our test flights.
Ii) Personal selling the case VGA when our product costs IIS$200, OHO which is very expensive for the general public, personal selling seems to be the most effective way to communicate directly with customers. Personal selling helps to easily gain customers’ confidence, we can build strong relationships with them and achieve customer satisfaction. VGA is based in the UK and California, USA when potential customers can be from around the world from USA to France in Europe or Japan in Asia. Therefore, we should have agents in each location, at least one in North America, Europe and Asia.
Middle East in recent years has become a very potential market for high quality goods and services, we should have an agent there too. Russia which has a high number of billionaires is also very potential therefore cannot be neglected. These agents can cooperate with insurance companies to gain customer confidence. Insurance is surely an important issue which our potential customers are mostly unconcerned about. Therefore a clear and sufficient insurance policy must be developed. These agents should be reachable around clock and available at all times based on customer demands.
V) Direct marketing only form of direct marketing that can be applied in case of VGA is direct mail or newsletters. We can get the database from partners or space websites of those who are interested in space tourism and send them the brochures. We should also have newsletters sent to subscribers on our website.
V) Sales promotional for sales promotion, discounts or any other ways to lower the price are irrelevant and can be ineffective. However, we might consider offering free flights to world achievers such as Nobel Prize winners to leverage our brand name, souvenirs for visitors and flyers, etc. . Establishing the budget budget will be spent according to the priority of the sales methods; personal selling (35%): more budget should be allocated to personal selling because this will be Bag’s main channels. The budget will include opening representative offices in different countries, salaries for agents, commissions for agents, and their allowances.; Public relations (25%): includes organizing trade fairs, events, seminars, etc. Advertising (20%): includes advertising on magazines, coordinating with National Geography, Discovery Channel and BBC, advertising on websites, etc. The rest of the budget (20%): will go to sales promotion, direct marketing and other miscellaneous activities.
T. Lamentation and controller marketing communications plan needs proper implementation and control to be efficient and effective. It helps VGA to maintain a strong message consistency and have greater sales impact. Our agents need special training in communication and negotiation skills. To measure the communication exults, VGA can carry out surveys to learn about customer attitudes towards our advertising campaign and we can make changes in case the result is not satisfactory.
Ill. Conclusiveness a new business in a new market is difficult but also an advantage at the same time. It is difficult to deliver the information to customers because they are not familiar with the product, in this case it is space tourism and it is even “far” from reality. Then, it is difficult to convince customers due to high costs, safety, reliability, etc. That is why a proper and effective marketing communications plan is racial to VGA success in getting potential customers. Only then we can have our advantage which is being the innovator and market leader in the future. Section 2 – How To Be Customhouses? . Illumination this section, we will discuss about how Virgin Galactic (VGA) can make their business truly customer focused. However, before that we should know the meaning of market oriented company because customer focus is one of the functions of market orientation. Al. Market oriented company market oriented company or market driven company is one that focuses on customer needs, organizing its activities, products and services according to customers’ requirements. Such companies always try to get closer to customers so that they can understand customers’ needs and problems.
To be a market oriented company, VGA should follow the tools of market orientation (The Times 100 1-J, Market and product orientation):Tools of market orientation include:;Market research: or marketing research is a form of business research that studies the buying habits of customers.
Market research methods include:
– Qualitative research: is used for exploratory purposes through focus groups, in-depth interviews and projective techniques. For example, VGA can carry out the research by focus groups or in-depth interviews to learn how customers respond or how much they are interested in space tourism if price is lower.
Quantitative research: uses sampling techniques to get the results through surveys and questionnaires. Unlike qualitative research, quantitative research can be done on a bigger amount of customers.
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For example, launching Spaceship One’s purpose was for market testing to see how the response from the public was. If the feedback is good and prospective, e will continue the development. That is why Spaceship Two was developed after its predecessor’s success. Customer touch: means the company touches on customer needs, makes changes according to customer requirements to achieve customer satisfaction, customer loyalty and customer retention. As to how to be customer focused, it will be discussed in more details in the next part. Ill. How to be customer focused.
What are our target customers? (Market segmentation)
First VGA should make sure that they focus on the right group of customers. Because it will be a niche market for VGA, a proper market segmentation analysis should be carried out.
As mention in Section 1, Bag’s target customers are those who have a life long dream of traveling into space and those who want to be the first to do something. However, the most important criteria is they have the ability to pay for the luxurious trips.
B. Customer focus strategies; Focus on customer needs: it is obvious that VGA is offering space traveling services and customers who are interested in the service want the same thing. However, it is also important that VGA listens to and understands the needs of customers besides the basic service. Examples can be support during deiced check, training, psychological preparation, etc. Provide customers with sufficient information: VGA should make sure they provide customers with sufficient information both before and aftertaste related to space traveling matters and customers can get help and support from us whenever they want. ;
Well-trained salespeople and agents: these people are those who interact with customers directly and represent the image of the company. It also involves the leadership which should also be customer focused. ;Delivering superior customer value: companies focus on what customers value the cost and try to meet and exceed it.
For example, Wall-Mart with its slogan: “always the low price” or Dell Computers with its ability to provide customers with maximum customization on cost-effective personal computers. As for VGA, we are offering space traveling which is a revolutionary service with a much lower price than other competitors so that more people can achieve their dreams of seeing the Earth from space. Exceeding customer satisfaction can be achieved by professional salespeople, professional aftertaste support, personalizing relationships, staying in touch… Different customers have different needs: an added service can be a value for certain customers but not for others. VGA should focus on helping customers find the added value. Besides, sales presentation should also be customized to the customer we are dealing with. ;Tightening the connections: when our relationships with customers become strong, we can move on to tightening the connections between customers and the company. For example, many airlines have frequent flyer programs or Nikkei enrolled their customers in its Monika Club where people have the same interests can interact and exchange intimation.
VGA can do the same by organizing a club, e. G. A space club, where members who are interested in space and space traveling can have a forum to get help and exchange information. We can actually get more customers through the forum by referrals. ;Take into account the cultural and religious needs of customers: VGA will be dealing with customers from all over the world, be it from USA, England to Japan or Middle East, every customer from each country has their own cultural and religious needs which VGA should try to fulfill.
When it comes to cultures and religions, it can become insensitive issues. People from different cultures have different styles of doing business. VGA; Customer relationship management (CRM): CRM can be considered one of the most important parts in customer focus strategies. To be truly customer focused, VGA should apply CRM into their business.
-What is CRM? CRM is a method used to learn more about customer needs and their behaviors so that the company can develop stronger relationships with them.
-CRM System: is a database that contains all the information about customers. Why is CRM important? Following are a few advantages of having a CRM system:lot alps to increase customer loyalty and retention increases the company’s revenue and profits helps to serve the customers better and increases our competitive advantageous helps to easily build and maintain relationships with customers, keep track of their current and future needs. Nowadays, CRM is the ultimate solution for a better customer service. By applying CRM into business, VGA can achieve customer satisfaction and serve them better. There are a few other things that VGA can do to be customer focused, such as:
-Deal with customers with courteousness
-Achieve service standards-Control and maintain revive standards-welcome customer feedback-Handle complaints from customers effectively
-Give customers more choicely. Conclusion today’s business world, being product oriented is not enough.
Customer relationships have become the core of every business’ success. Without customers, there is no business. It is even more important for VGA to be customer focused as it is targeting a niche market where customer requirements are higher.
Being truly customer focused helps VGA maintain its competitive advantage and stay in the market longer. Section 3 – Misrecognition’s Dissonances. Illumination the first section, we have already developed a marketing communications plan for VGA. During the process of implementing marketing communications plan, cognitive dissonance might occur and influence the company’s image, customer expectation and satisfaction. This section will discuss about cognitive dissonance and how important it is to minimize cognitive dissonance in the minds of target customers.
I Cognitive dissonance. Want is cognitive dissonance? Cognitive dissonance is a psychological term that refers to an uncomfortable feeling or emotion caused by having two conflicting ideas at the same time. When cognitive dissonance occurs, it is unman nature to reduce the dissonance by changing one’s existent belief or rejecting one of the conflicting ideas. In marketing communications scenario, to avoid dissonance, new information must be in harmony with customer’s existing knowledge. Cognitive dissonance can occur both in pre-purchase and post-purchase stages.
For example, in the pre-purchase stage, a man knows exactly that air transportation is the safest compared to any other ways of transportation. Even his family and friends have had experience flying with no problems, he might still refuse to fly because he thinks it is dangerous. We can see the two conflicting ideas here between flying is safe but still refuse to fly. This person might eliminate the dissonance by choosing to travel by car instead. In post-purchase stage, cognitive dissonance occurs when a person’s experience does not match with his expectation.
When a person buys an Littleton device, he would expect it to function properly. When it does not, that person suffers cognitive dissonance. To reduce dissonance, he might want a refund. Poor aftertaste customer service might also lead to cognitive dissonance. B. The impact of cognitive dissonance is very important to minimize cognitive assonance in the minds of target customers, especially in the case of VGA because space tourism is absolutely new to the general public, customers have few information regarding space tourism and the price is very expensive.
Following are some reasons why minimizing cognitive dissonance is important:pre-purchase stage
Space traveling is not safe! There are still a lot of people who think aircraft are not safe, let alone spacecraft. Moreover, the Challenger tragedy in 1980 when seven American astronauts died because of an explosion Just shortly after launch still has a read impact in people’s minds. Customers suffer cognitive dissonance when they are interested in space tourism but they face fears when thinking about the tragedy.
There will be a resistance in the minds of customers against the idea of space traveling. To get the target customers, we must minimize this kind of cognitive dissonance.; Why VGA is cheaper than its competitors? People tend to think that cheaper cannot be better even though they always want things to be cheaper. Customers will like the idea that VGA is now offering space tourism with lower price but at the same time they bout the quality of the service.
Minimizing this dissonance can help us clear the doubts of customers and achieve our goals of getting the target customers. Customer high spectrophotometers tend to have certain expectations when they buy a product or a service and the more expensive it is, the higher expectation they have. For example, customers know that Mercedes Benz is much more expensive than Toyota, so they will think Mercedes Ben’s showrooms must be bigger, better and salespeople must be more professional. If Mercedes Benz fail to show that their showroom is much otter than Toast’s, cognitive dissonance might occur and lead to customer dissatisfaction.
In case of VGA, $200,000 is not a small amount of money. Customers will surely have certain expectations and sometimes unreal and unreasonable expectations. VGA must try to minimize this kind of cognitive dissonance otherwise it will become long term negative impression. Post-purchase gatepost-purchase stage mainly involves aftertaste service. If the customers think that the service VGA provides is not worth $200,000 and lower than expectation, they will complain and through word of mouth, it might affect the Meany’s image.
Besides, it might be possible that after buying the service, customers might realize and regret their decisions when it comes to training, medical checking or fear. It is very important that VGA should try to minimize the cognitive dissonance as much as possible. C. How to minimize cognitive decontamination’s cognitive dissonance in the minds of customers is possible if we know the causes of the dissonance. According to Festering (Festering, L. , 1957), there are three ways to eliminate cognitive dissonance:- Reduce the importance of the dissonant beliefs.
Add more consonant beliefs that outweigh the dissonant beliefs. -Change the dissonant beliefs so that they are no longer inconsistent. By applying the theory, VGA can minimize cognitive dissonance a good company’s image:As VGA provides premium services targeting rich customers, the company should be up to customer expectation. To build a good company’s image, we should have:-professional employees and agents-Attractive and professional offices and showrooms-Attractive website including images and videos of our business, test flights, Spaceship One… Attractive and useful printed materials with detailed information regarding space tourism;personal slaughtering personal selling and one-on-one meeting and negotiation, our agents will be able to give customers more information and be of help whenever possible. This is one of the effective ways to reduce cognitive dissonance.
For example, Just like other insurance companies where they have lots of agents, through personal selling, customers are able to get information, their questions can be answered and especially they get good aftertaste support, it is one of the ways to get reassurance which helps to reduce cognitive dissonance. Positive testimonial’s companies have been doing testimonials to minimize customers’ cognitive dissonance. For example, Proper and Gamble has been showing satisfied customer testimonials about Pentane on TV advertisement. When customers watch this, they see other customers’ real experience and it will gradually build up the trust about the product in their minds. VGA can seek some endorsement from famous scientists or engineers saying that all Bag’s operations and technical matters are tested carefully and space tourism is very safe.
Besides, we can get testimonials trot people who Join tiling tests, etc. Exceed customer expectation can exceed customer expectation by improving the quality of service and should make sure that customers do not build up their expectations so far in the first place. We should also make sure that customers find our offering better than what they get from competitors. ;Effective marketing communications plan should be careful in their marketing communications and avoid sensitive issues.
For example, to compete with Nikkei, Rebook broadcast a commercial showing two persons doing bungee Jumping, the person wearing Nikkei died (by showing only a pair of Nikkei left) and the one wearing Rebook is still alive because he is wearing Rebooks Pumps (The New York Times, 1990). Rebook had to remove the ads because of complaints from customers and it created negative impressions on the brand. Therefore VGA should avoid sensitive issues in their marketing communications such as the Challenger tragedy.
We can talk about that issue and explain that space tourism is still very safe in such a way that customers will not give negative feedback. Ill. Conclusiveness’s dissonance being formed in the minds of customers is inevitable. Customers will try to reduce the dissonance themselves by choosing one f the conflicting ideas. Bag’s Job is to make sure the choices that customers make are favorable to the company. We can do it and minimize cognitive dissonance by well- trained and professional personal selling, maintaining good company self-image and exceeding customer expectation.