Marketing Management

Master of Business Administration

Siam University

Project Goal:

To Develop a Sustainable Marketing Plan

for
Thailand’s Home-Stay Operators
A Part of Thailand’s Pro-Poor Tourism Policy

Group Members: Peter Masters 5117192001

Feng Zhou 5117190017
Shunhai Li 5217192008
Executive Summary

The Long Tail theory refers to the behavior of economic sectors that
provide products in relatively low volume, but are able to make a profit by
providing a greater variety of products in aggregate. This is in contrast to
the short head sectors where profit is based on a more narrow range of
products selling in much higher volume. From a tourism perspective, the
short head is the cash-cow destinations that are widely known and attract
large numbers of visitors, while the long tail is the specialty niche
destinations (Lew 2008). Most tourist’s visiting Thailand have destinations like Bangkok,
Pattaya, Phuket, Koh Samui, and Chiang Mai on their itineraries, these represent the short
head sector, while the focus of this plan is marketing a sustainable home-stay industry within
the long tail of Thailand tourism.

Currently, there is no coordination amongst the home-stay properties in Thailand and this
project will develop a home-stay network with the Tourism Authority of Thailand (TAT)
having a central role by providing a link between the supply-side (the home-stay providers)
and the demand-side (the tourist market). The aim is to develop a web presence via the TAT
website that includes e-Home-stay, an intelligent decision support system, which offers a
unique selling proposition because it allows tourists to choose authentic Thai accommodation
and activities in accordance with their preferences and expectations. Consumers are seeking
more personalised tourism products and services, and are expecting intelligent and proactive
access to relevant high quality information and services rather than mass marketed solution
(Henley Centre HeadlightVision/Amadeus 2009). Thailand’s home-stay industry can develop
into a major factor to improve many people’s economic situation, especially those who have
never considered the possibility of being involved in commerce, let alone ‘e-commerce’.

However, to ensure the sustainability of the home-stay industry in Thailand, tourists must
have access to a sufficient quantity of relevant information regarding individual home-stay
properties, allowing them to match their preferences and requirements with the appropriate
home-stay experience. There is a wide variety of properties within Thailand’s home-stay
industry, ranging from truly authentic village based properties to relatively up-market
“home-stay” properties. Home-stay has the potential to satisfy many of the life-style needs of
neo-consumers and e-Home-stay represents an appropriate form to engage with them, for
promotion, marketing and information exchange as well as for sales transaction processing.
e-Home-stay represents a potentially potent force in tourism development since the search
for new and novel experiences is one of the major engines driving the tourism life cycle and
e-Home-stay opens up new experiences that match those sought by consumers.

Marketing for sustainable pro poor tourism involves the same process and elements used by
all businesses and destinations though the orientation is quite different. Sustainable tourism
marketing stresses the following:

o Meeting the needs and goals of the local community and then targeted customers
o Matching locally supported products to appropriate segments (e.g. niche marketing)
o Attracting high-yield and high-quality visitors

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o Cultivating the right image to convey environmentally and culturally sensitive
messages, employing unique selling propositions

o Communicating effectively with and educating all visitors

o Employing environmental and cultural interpretation
o Managing the visitor and encouraging the adoption of codes of conduct
o Achieving efficiency by avoiding high peaks of demand and overuse
o Research into appropriate segments, and communication
o Building repeat trade (e.g. brand loyalty).
(www.unescap.org/ttdw/Publications/TPTS_pubs/Pub_2265/pub_2265_ch6.pdf)

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Home-stay Marketing Plan 2010 – 2014

Goals

The first goal of this marketing plan is to position Thailand’s Home-stay industry as the
ideal niche tourism sector for the TAT Policy and Marketing Plan 2008-2012 targeted
visitors. This provides the opportunity to gain substantial leverage from TAT’s marketing
efforts, and allows the Home-stay sector to focus on their ‘micro’ issues.

A second goal is to assist in building a sustainable world-class tourism product by

providing educational and training opportunities to Thailand’s village based Home-stay
tourism sector to support the growth of a tourism destination offering an authentic and
positive tourist experience.

The primary goal is to provide a mechanism for the members of Thai society that currently
are not receiving direct benefits from Thailand’s tourism to gain economic and social
opportunities from tourism at the ‘village’ level.

Objectives

“A traditional village-based Thai Home-stay will maintain and share a traditional way
of life and its values, provide traditional food, be based on eco-friendly concepts and
require small amounts of investment for renovation not building”.

With the above definition as a guiding concept, Thailand’s e-Home-stay Project seeks to:

1. Ensure that hosts-

o Offer an authentic Thai village experience
o Obtain a fair return for their services and investment
2. Ensure that e-Home-stay contributes to conserving local cultural and natural heritage
and that hosts and their guests are aware of the links between tourism and local
cultural and natural resources

3. Creates an authentic, reliable, tourist experience and accommodation for visitors

Strategic Approach

The strategic approach of the e-Home-stay Project is based on its sustainability, thus its
success will be assessed by its ability to achieve the stated objectives, and visitors, hosts and
other parties maintaining interest in the project over the long term.

Our strategy involves a carefully planned, step by step process, building on successes and
keeping participants expectations in perspective. The activities require investments in data
collection, skills development and building reliability during the first two years, and
increasing the focus on promotion and expansion in the following two years.

• Skills development of the home-stay operators (building capacity to manage, adapt

and innovate;

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 • Building reliability in the services and methods used, (monitoring, manuals, market
research methods, operator and visitor feedback),
• Creating a network of home-stay operators allowing them to have easy and mutually
beneficial contact
The promotion and expansion of services and products must proceed in a carefully
considered way allowing for the right tourists to be attracted to a reliable, authentic product
so they provide a positive response. Word of mouth will be our most effective longer term
promotion, but reliability and access to correct information will be critical to ensuring a
successful and sustainable home-stay industry.

It is imperative that TAT act as a 'Convener' as this will provide credibility for the small,
village based home-stay operators. TAT must provide the portal for marketing, payments,
consumer and operator education, as the small unknown operators have very little experience
or knowledge, either of successful marketing strategies nor of effective management. Jantarat
and Williams’s study (2000) of the role of the Tourism Authority of Thailand (TAT) as a
convener in the development of the ‘Amazing Thailand Campaign” found that the reason the
campaign enjoyed wide acceptance was because TAT (a national tourism organization) was
perceived to have expertise, had a recognized brand and was government-mandated.

Situation Analysis

Tourism Authority of Thailand Policy and Marketing Plan 2008-2012

These objectives address the overall objectives of the Tourism Authority of Thailand
Policy and Marketing Plan 2008-2012 in the following ways:

• Poverty reduction through increase in income for village households from tourism
operations and livelihood options
• Reducing rural to urban migration through increasing livelihood options within rural
settlements
• Protection of cultural and natural heritage through the promotion and pride of
providing traditional accommodation and related services such local guide services
that generate incentives to protect resources for income generation

According to Tourism Authority of Thailand (TAT) Policy and Marketing Plan 2008-
2012, TAT wants to promote the tourism industry as a key to dealing with the country’s
economic problems by creating jobs for people and at the same time increasing public
revenue. In order to create jobs, TAT have been focusing on promoting and the development
of proactive marketing to increase expansion into new markets as well as developing niche
market opportunities. Furthermore, TAT aims to attract a far greater number of tourists to
regions with minor tourism type attractions, which currently do not appear on main-stream
tourist programs while preserving community, cultural and environmental values.

TAT has introduced an important strategy with the focus being placed on ‘quality’ over
‘quantity’, thus attracting ‘quality’ visitors to a ‘quality’ destination. ‘Quality visitors’ is
defined as those who are socially and environmentally aware, and are responsible travellers
with a keen interest in learning about the places and communities they visit. As a result, they
are more likely to have a longer average length of stay. This policy is also high on the

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government’s priorities for Thailand’s economic recovery and as a way to assist in the
economic equality for all of Thailand’s population.

TAT’s main role is be to build a bridge between supply (the home-stay operators) and
demand (the tourist market), the supply-side requires substantial development prior to the
targeting of major markets.

• Commercial problems (gateway): The connection of local firms to international

markets in order to ensure the marketing of tourism products is carried out today
largely due to Internet and to Web sites. However, many home-stay operators do not
have access to the Internet that enable them to get into contact with tour operators and
especially with individual customers who buy their tourism products directly on line.
Indeed, creating an Internet website does not ensure that it will be visited and that it
will be able to generate sales in an adequate quantity.

• Operational problems (on-line or not on-line): Access to the Internet supposes

that sufficient user’s have sufficient knowledge and that adequate information, in real
time, together with video/photographs of individual properties and of tourism
activities is provided. For that, it is essential to have an ADSL Internet network at
high speed, which is not the case in many home-stays as they are often located far
from large cities, therefore technological education in tourism marketing remains
limited for the majority of potential, authentic home-stay operators.

Issues and Trends

o Technology such as the internet has made booking travel-related products easy and
convenient, empowering the consumer to be less reliant upon the traditional tourism
supply chain. This disintermediation opens many possibilities for consumer-direct
marketing and distribution.

o Demand is rapidly increasing for niche tourism products that are customised to satisfy
the tastes of an increasingly discerning traveller, particularly among business and
affluent leisure travellers. Many of these new niches are narrowly defined, but should
not be overlooked.

o Increasing numbers of experienced travellers are seeking more innovative, unusual and
finely targeted products which match their lifestyles, perception of their lifestyle,
interests and needs. The traditional annual holiday of one to two weeks, purchased
through a travel agent from a mass produced brochure, will no longer be the norm.

o Consumers continue to be heavily influenced by the image created by branding and

advertising which establishes market position, defines value-added consumer benefits
and builds confidence in tourism products. This trend is likely to continue, with
destinations and operators using the brand image to create a unique appeal to more
pinpointed markets and groups.

o New product development to appeal to individualized aspects of demand (e.g. health

and wellness tourism) will see further growth, as niche products aimed at specific
groups with these interests are developed.

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o An increased awareness and consciousness among travellers of the social and
environmental impacts of tourism which is fuelling a rapidly increasing interest in
responsible, sustainable and green tourism.

o Increasing numbers of travellers are seeking responsible tourism, aimed at supporting the
sustained development of local cultures and protection of the environment. These
travellers desire authentic experiences while at the same time foster benefits for the local
people and their environment.

As tourist’s preferences change with evolving technologies and lifestyle trends, it is essential
that Thailand’s tourism products and marketing adapts to these changes.

Tourism Life Cycle ~ Thailand and Vietnam

“Thailand tourist industry is 20 years ahead of the Vietnams tourist industry, so it is more
developed” according to TJ Grundl-Hong, Chief Sales Officer & MD Business Development
of Six Senses, however this has negative as well as positive inferences when Tourism Life
Cycle is considered.

Kotler, Bowen & Makins (2006) describe the fourth stage of a product’s life-cycle,
‘Maturity’, as a period of slowdown in sales growth because the product has achieved
acceptance by potential buyers. Profits level off or decline because of increased marketing
outlays to defend the product against competitors. While Butler (1980) defined specific life
cycle stages in his resort life cycle model (Fig 1.), and to these stages he assigned various
descriptive criteria. The stages were labelled “exploration”, “involvement”, “development”,
“consolidation”, “stagnation” and “decline” and/or rejuvenation”. The fifth stage, known as
the “stagnation” stage, is when “peak visitor numbers have been reached and capacity levels
exceeded for many variables resulting in environmental, social and economic problems”. The
region has become well known and well established, but is losing its tourism appeal. A large
number of manufactured attractions may start to outnumber the natural and cultural
attractions that were responsible the initial development of international tourism interest.

Figure 1 Hypothetical Evolution of a Tourist Area (Resort Life Cycle Model)

Source: Butler, R. W. 1980.

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Butler suggests that the type of tourists will change to the organised mass tourism market,
and this leads to the final stage, when the area will either decline or be rejuvenated. In the
“decline” stage there will be an inability to maintain market share. However, it is possible
that the region can go through a process of “rejuvenation”, which requires a complete change
in the attractions on which the resort is based. The model provides two ways that
rejuvenation can be achieved: first, using manmade attractions such as casinos; and second
taking advantage of previously untapped natural resources. (Berry 2001)

Environmental Analysis

Political and Economic Analysis

Economic and political issues that may influence the perceptions of potential tourists must be
given serious consideration while developing this marketing plan. This should include
scanning international and local factors as the long term sustainability of Thailand’s Home-
stay industry will be influenced by both international and local issues.

International perceptions of the suitability of Thailand as a tourist destination are being

influenced by the on going political problems, an example is the damage caused by the PAD
irresponsibly forcing the closure of the international airports in late 2008, which has had
serious negative affects on Thailand’s very important tourism industry. Added to the above
has been the fall in tourist numbers due to the widespread economic slowdown caused by the
global financial crisis and the concerns regarding the H2N2 flu virus.

Existing Regional Markets

For Cambodia and Vietnam the top ten source markets are clearly predominated by
travelers originating from Northeast Asian countries, particularly Korea, Japan and China
(PRC). While there is difficulty in obtaining tourism data and related information have
limited coverage of Myanmar, and in some cases, Guangxi Zhuang Autonomous Region and
Yunnan Province of the PRC., it appears that after the considerable demand generated by
domestic Chinese visitors, there is strong interest among numerous North American and
European markets. Tourism demand for Laos is highly slanted to cross boarder visitors from
neighbouring Thailand. Thailand’s tourism demand is well balanced with no single market
predominating except Malaysia due to heavy cross border activities in the south of the
country. While tourism arrivals to Myanmar remain relatively low at just over a quarter of a
million visitors there is strong penetration into a variety of markets with considerable interest
by high yield visitors.

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 Table. 1 SWOT Analysis ~ e-Home-stay in Thailand
Strengths Weaknesses
o Wide range of Home-stay properties available
o Unique range of nature based and cultural attractions o Low number of promotions
o UNESCO World Heritage
sites o Promotional funds thinly spread across markets
o Fascinating indigenous cultures and traditions o Limited focus of TAT market the Home-stay sector
o Low community awareness of Home-stay sector
o Generally friendly and hospitable local population benefits
o Well established and spectacular cultural events o Lack of market research/weak statistical base
o Extraordinary natural environments o Weak provincial tourism bureaus and associations
o Limited private sector involvement in Home-stay
o Excellent accessibility through international hub marketing
o Comprehensive air and land transport network
o Relatively unspoiled environment
o Increasing support from government for tourism
o Strong country branding in key markets

Opportunities Threats
o Growing global interest in activity based special interest
tourism o Increasing global oil prices
o Growing iconic status of natural and cultural heritage
attractions o Terrorist incidents as major deterrent to travel
o Strengthen marketing awareness of Home-stay pages on TAT
website o Thailand’s political instability
o Increased intra-regional and international air services o Increasing regional competitor Home-stay marketing
o Increasing interest in marketing and education for Home-
stay sector o Pandemics (A1N1 flu) will deter visitors
o The aura and mystique of Thailand o Adverse publicity (Politics & Southern unrest)
o Current lack of authentic, sustainable Home-stay
o Commitment to Sufficiency Economy Tourism operations
o Emergence of Eco and Culturally aware tourists o Insufficent funding for development and promotion
o Focus marketing on niche target markets (GeoSavvys)
o Strengthen research base to underpin marketing strategies
o Positively manage in key markets through PR program
o Increased internet marketing activities
o Focus marketing on to
markets

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Thailand’s Positioning and Brand

Thailand was 22nd ranked country brand in the FutureBrand 2008 CBI Global Quantitative
Survey and received five Top 5 global rankings including Authenticity, Value for Money and
Friendly Locals. TAT has positioned Thailand as a safe and friendly destination offering an
abundance of cultural, natural, and historical attractions. Several research reports support
TAT’s positioning of Thailand as a destination with beautiful beaches, reasonable prices, and
broad range of attractions. Bongkosh Ngamsom Rittichainuwat, Hailin et al conducted a
study to examine the current image of Thailand as an international travel destination and
assessed the effects of the destination's image on the likelihood of the travelers' returning
there. The results indicated that tourists have a positive image of Thailand as a destination
that offers cultural, nature, and historical attractions and activities. The respondents of the
study’s survey also agreed that a trip to Thailand provided value for money and that the Thai
people were friendly.
Home-stay’s Position and Brand

Village-based Tourism

Thailand’s Home-stay sector can emphasise village-based tourism which is perfectly

suited to the experiential wants of a new generation of world travellers who wish to be
socially and environmentally responsible. They are as much on a quest for new knowledge
and cultural exchange as they are in search of leisure, rest and relaxation. They are keen to
learn about the communities they visit. This has led to the increasing popularity of village-
based tourism.

Village-based tourism presents opportunities to enhance the experience for visitors by

highlighting the uniqueness of Thailand’s tourism assets, particularly cultural heritage.
Village-based tourism also makes it possible for visitors to immerse themselves in colourful
local culture and learn about Thai ways through the conservation of traditional Thai culture
and the development and promotion of community-based tourism. It promotes the protection
and preservation of the natural environment and instils pride in the national heritage among
the local population. This all helps pave the way towards sustainable tourism development,
strengthens the Thailand brand, and sharpens the kingdom’s international competitive edge.

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Market Segmentation
Segmentation and selecting target markets is a crucial part of the process because
demand will come from specific areas of the global marketplace and because sustainable
tourism marketing is the opposite of mass marketing, care must be taken to identify and
attract appropriate market segments. Information regarding the understanding of potential
target segments has been obtained from previously published sources, for example TAT,
Pacific Asia Travel Association (PATA), United Nations agencies (www.unctadxi.org
www.unescap.org) as well as academic and commercial research reports.
The Geotourism Study – Sponsored by National Geographic Traveler

As this marketing plan is part of an exploratory phase of a longer term project an existing
research report was selected as the basis for the segmentation process. The Geotourism Study
was undertaken the Research Department of the Travel Industry Association of America in
2002 and sponsored by National Geographic Traveler. Though the Geotourism Study only
involves respondents from the U.S.A. it is very useful as a “base” segmentation tool for
potential tourists from countries with a Western cultural heritage from example, Canada,
Australia and the United Kingdom. The data provides highly relevant information for use in
the exploratory phase of the target marketing and communication process.
The study was conducted with adults 18 years of age and older among a representative
sample of U.S. households. The study sample consisted of 8,000 adults, and was balanced to
represent the national demographics of American adults. A total of 4,300 questionnaires were
returned for a response rate of 54 percent. Results from returned surveys were re-balanced to
reflect the demographic profile of U.S. adults. Among these, a total of 3,300 qualified as past
three-year travelers, meaning they had taken at least one trip in the past three years. Results
from this traveler sample were then projected to the entire U.S. adult population and have a
statistical error range of +/- 2 percentage points.
The Geotourism Study created eight Geotourism profiles of the respondents through an
examination of attitudes, behaviors and actual travel habits. Most travelers (65%) are city-
dwellers living in urban areas with populations of 500,000 or more. Four in ten (43%) are
Baby Boomers between the ages of 35 and 54. About 30 percent are Generation X and Y
(age 18 to 34), and 27 percent fall into the Matures category, age 55 and over. Nearly half
(45%) of American travelers have a college education. Thus, the average annual household
income among travelers is higher than that of the U.S. population in general ($62,720 vs.
$57,047). Most American travelers work full or part time (68%) and 17 percent are retired.
Four in ten have households with children under the age of 18 present.
Overall, the majority of the traveling public (71%) indicates that it is important to them
that their visits to a destination not damage its environment. Nearly two thirds agree (61%)
that their travel experience is better when the destination preserves its natural, historic, and
cultural sites and attractions. Over half (53%) of travelers agree that their travel experience is
better when they have learned as much as possible about their destination’s customs,
geography, and culture.

Results from the survey topics above were also statistically combined and analyzed to
segment travelers based on like responses. This segmentation process created eight market
segments, each with unique Geotourism profiles. Segmentation results showed that three
segments share similar levels of income and a high incidence of travel, yet each possesses a
somewhat unique Geotourism profile. These three groups have the strongest Geotourism
inclinations compared to the other market segments.

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In total, the three groups represent greater than one third of the total 154 million American
travelers.

o Geo Savvys (16.3 million travelers)

o Urban Sophisticates (21.2 million travelers)
o Good Citizens (17.6 million travelers)

A detailed profile of Geo-Savvys is provided below:

Demographic Profile
• Geo-Savvys are slightly more likely to be women (54%) than men (46%).
• Over half of women are baby boomers (53%); 47 percent of men are baby boomers.
• One in four Geo-Savvys is a young adult under age 35.
• Along with Urban Sophisticates and Good Citizens, they are very well educated with 61
percent having at least a college degree. One in four (25%) has a graduate degree.
• One third of Geo-Savvys (32%) hold professional/specialty positions, similar to Urban
Sophisticates and Good Citizens.
• Geo-Savvys are also quite affluent. Over one third (38%) have annual household incomes
over $75,000; 17 percent have household incomes above $100,000.
• Due to their middle-age status, many (38%) Geo-Savvys are in the older parent or working
older couple life-stages. Over one quarter (29%) are in the young or middle parents life-
stages.
• Half (51%) live in large cities or urban areas. Like Urban Sophisticates, one in five (22%)
lives in a slightly smaller city of 500,000 to 2 million in population.

Travel Profile
• Geo-Savvys also travel quite frequently, with 45 percent taking five or more trips in the
past year. This group has the highest average number of annual trips (7.6) compared to all
segments.
• Geo-Savvys are highly likely to have traveled internationally. Four in ten (44%) Geo-
Savvys have taken at least one international trip in the past three years; 17 percent have taken
at least three trips outside the U.S. in the past three years.
• Geo-Savvys have a high incidence of business travel, with 58 percent taking at least one
business trip in the past year.
• Due to a high propensity for leisure and business travel, the majority (65%) of Geo-Savvys
have taken one or more trips by air in the past year.
• Overall, the Geo-Savvys travel profile is most similar to that of Urban Sophisticates.

Geotourism Profile
• Geo-Savvys show a distinct preference for culturally/socially-oriented travel. The majority
(81%) believes their experience is better when their destination preserves its natural, historic,
and cultural sites and attractions, the highest share of all segments. Three-quarters (73%) say
that the educational experience provided by travel is very important to them.

Attributes of Travel:
Geo-Savvys are more likely than any other cluster group to do the following:
• 83% visit destinations with authentic historic and archeological sites
• 81% prefer small-scale accommodations run by local people
• 81% travel to experience people, lifestyles, and cultures very different from their own
• 80% visit small towns and rural areas
• 73% feel it is important to learn about their destination's people, history, and culture

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Attitudes and Behavior:
• Geo-Savvys are intellectually curious, with the highest level of reading or watching shows
about history or culture (74%).
 They are second only to Good Citizens in watching public TV (71%); visiting historic
sites in their local area (65%); taking educational classes and/or attending seminars or
lectures (43%); participating in civic organizations (37%); donating money to (40%)
and/or volunteering for (33%) historic, cultural, or educational organizations; or
visiting local art galleries or museums (46%).
 Geo-Savvys believe it is important to learn about other cultures (85%) and to pass on
our nation's history to the next generation (93%)
 Geo-Savvys have well-developed social consciences. Most Geo-Savvys say they
recycle (89%) and try to save electricity and water at home (85%). Above-average
shares buy energy-efficient appliances, even if they cost more (60%). They also buy
environmentally safe household products (47%) and organic food products (27%), as
well as buy from companies that donate to charities (44%)

Distinguishing Characteristics:

• What really distinguishes Geo-Savvys from similar groups (e.g., Urban Sophisticates) is
their well-above average interest in environmentally-oriented travel. It is more important to
Geo-Savvys than to any other cluster that they not damage the environment when they travel
(84%). They are nearly three times above average in enjoying primitive travel to wilderness
areas (59%). They are twice as likely than average to like outdoor adventure travel, offering
challenge, risk and excitement (57%) or to travel to remote locales (66%).

o Geo-Savvys’ at-home behaviors provide opportunities for the marketing

communication process.

• They are the most likely of all segments to;

o read or watch shows about nature and the environment (61%);
o donate money to nature/environmental organizations (37%);
o subscribe to nature/environmental publications (35%);
o be a member of an environmental, development or human rights group (30%), a
nature club (18%).
Target Market for Home-stay Tourism

Multi-segment approach is the most appropriate because the introduction of the

intelligent decision support system e-Home-stay via the TAT website allows the targeting of
several different segments due to the differentiated Home-stay products offered. However,
this marketing plan will initially focus on the Geo-Savvys segment allowing for a more
efficient use of available resources.

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Research question:

“What are the best ways to communicate with the target markets?”

The relevant research question is “What are the best ways to communicate with the target
markets?” therefore the research process will include formulating two questionnaires, one for
home-stay operators on a global basis, and one for travellers. Questions for home-stay
operators might include items such as; “what communication channels do you use for
promotion?” (this may include a list of optional responses, eg; tourism
authority(brochures/website/printed advertisements/exhibitions/other....) travel agent
(brochures/website/printed advertisements/exhibitions/other....) /own website/ another
website, with an open ended section available. For travellers, the questioning might be along
the lines of “how do you discover homestay opportunities?”, with the same set of options for
responses. Another set of questions could ask how effective respondents feel a specific
channel is for achieving their objective. For home-stay operators that would be for promoting
their products, for travellers it would be for discovering home-stay opportunities. By
comparing the sets of responses we should get a picture of how closely providers’
communication strategies match those of the market segment they are trying to reach.

Unique Selling Proposition (USP)

The e-Home-stay (intelligent decision support system via a choice board) which allows
tourists to choose niche tourism destinations in accordance with their preferences and
expectations provides Thailand’s Home-stay industry with a competitive advantage. TAT
should highlight this USP quite strongly in the preliminary promotions as the competing
national tourism organizations will introduce similar systems for their home-stay products.

Today, many travellers utilize online reservations for travel planning and would prefer to
do the same with bed and breakfast/ home-stay reservations. Only those home-stay operators
who successfully adopted an e-commerce strategic model can thrive in such a highly
complex electronic market (Huang, 2006).

To ensure sustainability of Thailand’s Home-stay industry tourists must have access to a

sufficient quantity of relevant information regarding individual Home-stay ‘products,
allowing them to match their perceptions and expectations with the appropriate home-stay
experience. For example, a tourist may have the intention to experience life with a Thai
family but still expect sit-down toilets and a hot shower; while others want to experience the
reality of life in a village and would be disappointed if their bedroom had an air conditioner
and cable television.

Therefore the convener (TAT) requires an IT system that has the capability of sorting both
the tourists according to their perceptions and expectations and the home-stay operations
according to their facilities, geographical locations, activities plus other experience
opportunities (festivals). This will enable the matching of the most suitable home-stay
accommodation experience with each individual tourist’s perception and expectation and
therefore, it will provide the highest level of satisfaction; thereby avoiding the potential for
damaging results of disgruntled tourists reporting their complaints about their experiences in
up-country Thailand on the Social Network websites like tripadvisor.com and facebook.com.

A study done by the Technical Assistance Research Program found that when people have
a good experience they tell five people. If they have a bad experience they tell ten people.

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Spreading a positive word of mouth message is difficult. A few negative stories can offset
many good stories. The goal is to have every guest’s expectations met or exceeded (Kotler,
Bowen & Makins 2006 p 356)

Intelligent Decision Support System ~ Relational Database Management System (RDMS)

This matching process can be achieved by creating a relational database management
system (RDMS) to deliver information required by the user. A suitable database may be
developed as follows;

Table 2 TAT Home-stay Relational Database Tables

Operator_Numbe
r Operator_Name Operator_Baan Operator_Amphur Operator_Province
10001 Atikom Thomya Kokkor Na Klang Nong Bua Lamphu
10002 Benja Chaijaree Mata Put Ratchima Khon Kaen
10003 Chutima Tipsaen Songteaw Banso Chaing Mai
10004 Juntima Kongsang Sawong Jaani Chantaburi
10005 Juthawan Aryharn Bakeon Maisan SaraBuri

Creating a table for the Home-stay operators; each individual element of data for each
entity will be stored as a separate field, and each field represents an attribute for that entity.
Fields in a relational database are called columns. For the entity OPERATOR, the operator
identification number, name, and address are stored as a separate field within the
OPERATOR table and each field represents an attribute for the entity OPERATOR.The
actual information about each individual Home-stay operator that resides in a table is called a
row (records). The field Operator_Number (Figure 7) uniquely identifies each record so that
the record can be retrieved, updated, or sorted and it is called a key field. Each table in a
relational database has one field that is designated as its primary key . This key field is the
unique identifier for all the information in any row of the table and this primary key cannot
be duplicated. Operator_Number is the primary key for the OPERATOR table and
Facilities_Number is the primary key for the FACILITIES table (Figure 8)

The tables 4, 5, 6 are examples of tables that connect all the operators, as identified by the
Operator_Number that offer specific facilities, as identified by the Facilities_Number. The
next operation would be to project a list of operators that offer the specific requirements that
each user desires. This is a very basic example of the ‘Tourist-Operator Matching” operation
of the proposed TAT Home-stay Information Model but it provides a clear indication of its
effectiveness in providing a high level of user satisfaction.

TAT management and officers would have access to the data as well as data regarding the
online users, and this information can be a great benefit to TAT’s Customer Relationship
Management (CRM) programs. Through this extended database the Thai government
departments would have access to better information regarding the regions where visitors are
spending their time, how much time as well as their activities and thus develop infrastructure
plans to match future requirements

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 Table. 3 Range of Facilities Available at Home-stay Properties
(A) (B)
Facilities_Bathroom Facilities_Number
Inside house Bathroom_1
Attached to house Bathroom_2
Sit-down toilet' Bathroom_3
Traditional squat toilet Bathroom_4
Hot bath Bathroom_5
Hot shower Bathroom_6
Cold shower Bathroom_7
Traditional splash & wash Bathroom_8
Tiled floor Bathroom_9
Cement floor Bathroom_11
Facilities - Bedroom
Air conditioned Bedroom_1
Fan Bedroom_2
Inner spring mattress Bedroom_3
Traditional mattress Bedroom_4
Dressing table & mirror Bedroom_5
House structure
Brick & motar Structure_1
Traditional wooden Structure_2
No stairs Structure_3
Glass windows Structure_4
No windows Structure_5
Traditional wooden shutters Structure_6
Internet Access
Available at accommodation (free) Internet_1
Available at accommodation (fee) Internet_2
Available at nearby Internet shop Internet_3
No Internet access at accommodation Internet_4
Meals
Eat with host family every meal Meals_1
Eat with host family some meal Meals_2
Restaurant facilities
Access to local restaurant
(Traditional) Restaurant_1
Access to Western dining facilties Restaurant_2
Easy access to a 7/11 store (or
similar) Restaurant_3

Table. 4 Homes with an Inside Bathroom Table.5 Homes with an Attached Bathroom
Facilities_Number Operator_Number
Bathroom_1 10002
Bathroom_1 10003
Bathroom_1 10004
Facilities_Number Operator_Number
Bathroom_2 10001
Bathroom_2 10005

Table 6 Homes with Sit-down Toilet

Facilities_Number Operator_Number
Bathroom_3 10002

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 Bathroom_3 10003
Bathroom_3 10004
This database should include more fields for example,

o Geographical location
o North
o North-East
o Central
o Geographical attractions
o beach, mountains
o Available activities
o Physical (bush walking, fishing, mountain bike riding, elephant riding)
o Cultural (rice farm, temples, archeological
o Craft (Thai silk, cooking)
o Volunteer opportunities (teaching)

Table 7 Homes in North-East

GeoLocation_Numbe
r Operator_Number
North-East 10001
North-East 10002

Table 8 Homes offering Thai Silk Experience

ActivitiesCraft _Number Operator_Number
Thai Silk 10001

Therefore a tourist wish to stay in a home-stay in North-East Thailand that has a bathroom
attached to the house and offers a Thai silk craft experience would receive the following
result

Table 9 Suggested Home-stay Property

Operator_Numbe
r Operator_Name Operator_Baan Operator_Amphur Operator_Province
10001 Atikom Thomya Kokkor Na Klang Nong Bua Lamphu

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Marketing Mix ~ e-Home-stay

The marketing mix can be determined by using the four Ps (product, place, price and
promotion) and we have added: place, partnerships, programming and people. These are the
tools for implementing a Home-stay marketing strategy.

1. Product

Often using traditional tourism marketing products are developed that will attract tourists,
regardless of whether they are appropriate to local communities or if they may cause adverse
effects to the environment. Sustainable Home-stay marketing shifts the emphasis to products
and services that will attract and satisfy specific desired tourist segments. Each home-stay
can develop its own special product mix, taking into account its resources, values, needs and
preferences. The result should be an authentic community tourism product attractive to those
tourists wanting hospitable and unique experiences.

2. Place (Distribution)

Initially, we will use the channels provided below and similar, but we will incorporate
more channels as data are received from our research project (“What are the best ways to
communicate with the target markets?”).

Geo-Savvys have well-developed social consciences, they recycle (89%) and try to save
electricity and water at home (85%). They buy energy-efficient appliances, even if they cost
more (60%), they also buy environmentally safe household products (47%) and organic food
products (27%), as well as buy from companies that donate to charities (44%). Therefore,
using online channels that focus on these issues will provide numerous ‘touch’ points for
Thailand’s e-Home-stay properties.

Ecotourism Associations
Alaska Wilderness Recreation & Tourism Association (AWRTA)
Hawaii Ecotourism Association
The International Ecotourism Society
EcoTourism Portal

Eco Shopping & Green Resources

http://www.ecobusinesslinks.com/ecotourism.htm

Tour operators

Niche tour operators and specialist travel agents usually prefer more unique and smaller
suppliers. They are very keen to have authentic accommodation and activities to offer, and
the fact that e-Home-stay is verified by the TAT brand will be a great selling point. These are
organisations that sell holidays and travel products to consumers, often taking a commission
or margin on the product (or package of products) sold, which they have purchased from
suppliers or are selling (as an agent) on behalf of suppliers. Additional income is gained
through the sale of other travel-related products, such as travel insurance and foreign
currency.

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 In the case of e-Home-stay, we will establish a ‘partnership’ relationship, working
collaboratively with them on product development and direct marketing activities. The tour
operators can sell a package that includes accommodation and associated activities at one or
more of our properties and pay the home-stay operator directly.

https://www.intrepidtravel.com
http://www.trekescapes.com
http://www.exploremekong.org
http://www.godifferently.com/thailand/homestay_thailand
www.REIadventures.com

Ecotourism Travel Guides

The companies publishing traditional guidebooks are evolving to produce customised
guidebooks, and unique travel information, which is now not only coming in the typical
guidebook form, but also increasingly in electronic form, whether on websites or in
phone/PDA formats. Highly professional guidebooks are now also being produced by non-
governmental organisations and campaign groups, for which the motivation is development
assistance, rather than commercial profit.

The focus is increasingly shifting to the consumer, since publishers are discovering that
these publications meet a market need, giving objective (and entirely noncommercial) advice
on obscure community-led tourism products, offering consumers access to ‘authentic
experiences’ with less of the more negative aspects of tourism. By being produced by not-
for-profit organisations, consumers treat contents as a strong seal of quality assurance, which
helps increase sales of sustainable tourism products, which in turn promotes best practice in
tourism and across the industry.

The Good Travel Company

Eco Friendly Tours
Organic Holidays
EarthFoot
Planeta.com
EcoTour Directory
Vegeterian Travel Guide
Vegetarian-Vacations
Ecotravel

3. Price

Several basic price strategies can be employed:

o Set prices for specific target segments’ needs and willingness to pay
o Contract pricing with third parties (Tour operators)
o For high-quality and rationed products charge a premium
o Value added packaging.

Pricing will be on a property by property basis due to the wide variety of home-stay
properties and their associated activities. Home-stay operators will be encouraged to develop
value added packages, for example silk farm and weaving experience; traditional Thai
cooking classes; volunteer teaching opportunities. These packages can be developed in

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conjunction with TAT and selected tour operators and incorporated into the e-Home-stay
choice board facility on the website.

4. Promotion (Communications)

The traditional communications mix consists of advertising, public relations and sales
promotion. From a sustainability point of view, a number of factors must be considered:

o Communications must be targeted and carefully prepared to avoid false expectations

being generated
o Home-stay properties should be marketed differently from mass tourism products
stressing authentic experiences and activities.

5. Partnerships

Our authentic home-stay properties cannot afford to carry out the marketing process
independently. Partnerships will be required to launch effective advertising campaigns,
distribution channels, education and conduct research.

Specifically, TAT as the convener and associated participants will be required for the
project’s initial coordination phases and importantly, suitable tour operators/travel agents can
provide invaluable development input and feedback.

6. Packaging

Given that e-Home-stay is undertaking a sustainable tourism strategy it makes sense to sell
the experience as a package. This has a number of additional advantages:

o It is easier to educate the packaged tourist

o It is easier to coordinate with a tour operator to prevent negative impacts
o Possible to identify a package tourists as high-yield, high-quality visitors
o Certain types of packaging or group tours can be avoided

e-Home-stay should develop packages that:

o Promote authentic heritage and cultural experiences and activities

o Develop remote sites if suitably managed
o Occur during Thailand’s off-peak as well as peak seasons
o Make use of local community facilities, businesses and activities
o Mix residents (hosts) and tourists (guests)
o Allow investment in development and education projects.

Packages can have a core activity, such as a festival, farm stay or volunteer teaching, or can
be designed for cultural experience. Guidelines for packaging include:

o The package should have a clear and authentic proposition

o Price the package to cover all fixed and variable costs (van hire, guide)
o Develop all-inclusive packages that provide good value-added appeal and offers a
unique visitor experience

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7. Programming
Programming involves the addition of special events and activities to increase attractiveness.
Operators and their communities should develop programming to convey the image of an
authentic, active place to attract specific market segments. Though great care must be taken
to ensure these activities and events are authentic and not ‘staged’.

8. People
Home-stay operators will require cultural and hospitality training, however their local
communities will also be seen as part of the product. Hospitality will not be found where
residents are unhappy with the tourism development in their community so in will be
imperative for benefits to ‘trickle down’ to members of the community. This can be in the
form of traditional craft sales, food stalls (local restaurants) and involvement in the value
added activities. Many destinations employ internal marketing campaigns to convince
residents that tourism is beneficial and visitors should be respected and assisted. Many
people who meet and serve visitors do not think of themselves as being in the tourism
industry and therefore have to be educated about the importance of their role in the overall
tourism process.

Financial Requirements

The marketing and associated costs should not be passed on to the ‘low end’ Home-stay
operators (authentic village based) but rather they should be allocated to the government’s
policy of economic equality for all of Thailand’s population. The TAT website is already
well developed therefore the marketing costs related specifically to the Home-stay sector will
involve developing the e-Home-stay intelligent decision support system as well as costs
related to collecting data from the current and potential Home-stay operators. Much of the
community based management and training is also in place as the One Tambon, One Product
(OTOP) initiative developed these several years ago.

Unlike hotels, the challenge that is usually faced by Home-stays is the low connectivity and
problems in reservation due to minimal computerization. Another factor is the anticipated
relatively low level of information technology awareness of many home-stay operators,
therefore a process of training will be required. Additionally, their location in remote corners
of scenic tourist spots becomes a disadvantage and limits their scope of communicating to
tourists. Therefore the website should introduce a customised booking engine which includes
real time payment systems in numerous different currencies, and a revenue sharing system
(for example http://nexgentravel.com/). TAT can make this system available to numerous
tourism operators and thus the initial and ongoing costs will be kept relatively low for the
Home-stay sector.

The supply side will require a program for expanding the number of authentic village-based
Home-stay operators as well as cultural awareness education for the communities associated
with Home-stay operations. Data collection from home-stay operators as well as assessing
value-adding opportunities and activities for each property will demand a large proportion of
the financial resources. The project will require a monetary grant initially and ongoing
support to ensure its goals and objectives can be achieved.

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Evaluation
Objective 1
Amount of revenue from home-stays and guide services
Level of local participation and satisfaction with home-stay design, monitoring

Objective 2
Number of cultural features in home-stays and adaptation for visitors
Level of awareness activities and positive actions taken by hosts and visitors

Objective 3
Level of visitor satisfaction with home-stays and related services
Number of tour operator activities to promote and include home-stays in itineraries

Future Objectives

Develop a research project to explore the opportunities to expand this e-

Home-stay marketing model to the Greater Mekong Sub-region countries.
Ideally, this will include a formal recognition of the project and ongoing financial and
administrative support.

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