Service marketing strategies and performances of tourism and hospitality enterprises: implications from a small border province in Thailand

Abstract

PurposeThe objective of this study is to determine how service marketing strategies affect enterprises in the tourism and hospitality industry, especially, operators in small towns that are not tourism destinations and visited only by small numbers of tourists.Design/methodology/approachThis study investigates the impact of 4P strategy implementation on the potential and profitability of service operators in Nong Khai Province, Thailand, by using an econometric model and defining dependent variables in order to classify firm performance into 3 areas, namely, (1) revenue, (2) cost/expense and (3) profit—in log form.FindingsStudy results show that tourism and hospitality service operators have to place emphasis on “development,” starting from upstream processes such as research and development and utilizing local wisdom and reflecting cultural identities as well as focusing on downstream activities, including adoption of modern media. At the same time, operators should also emphasize marketing and sales promotions as well as seek publicity through websites and online social media in parallel with developing downstream activities.Research limitations/implicationsThis paper only focuses on Nong Khai Province as the research area because, first, Nong Khai has a relatively low income per capita and is located in Thailand's Northeast, the country's poorest region. Second, Nong Khai is a border province, adjacent to the Lao PDR, and thus there are numerous tourists from the Lao PDR and overseas countries who travel in and out of the province through the Thailand–Lao border checkpoints.Practical implicationsRelevant government agencies should provide support throughout the development process from upstream to downstream in order to upgrade the potential of tourism and service operators in this small province by incorporating local identities used for creation of service products and by supporting marketing and sales promotions whether in the form of organizing various exhibitions events, publicity via the Internet, etc.Social implicationsRaising service standards of an organization and developing an acceptable quality brand and setting fair prices without taking advantage of consumers were strategies that played important roles. This set of strategies was implemented together with a development strategy for people also through the process of team building and knowledge management, including skill development through a training system, which also played an important role toward the sustainability of tourism and hospitality enterprises in Nong Khai Province.Originality/valueIt is believed that this paper is the first study to apply Stan Shih's innovation smiling curve in a small border province of Thailand. This study could shed the light for tourism and hospitality enterprises in a small and poor town in attempt to be the sustainability.