Case 1

Amplrilrion: Your Ultimate Host in Greece

Atkis S. Magdalinos

AROUND THE END OF OCTOBER 1993, Constantinos Mitsiou, owner and manager of the Greek Amphitrion group of companies, was wondering it' he should launch a special tour for teenagers. What he had in mind was a tour lasting 14 days that would incorporate most of the natural beauty spots of Greece, as well as numerous historic and archaeological sites, lie had already concluded a tentative agreement with a couple of professors who would act as guides and worked out a preliminary itinerary, but now he was not sure if he should continue with the idea. Ainpliitrion, which started as a travel agency in 1957, was now a large travel and shipping business - 'your ultimate hosts in Greece'. The head office of Amphitrion is in Constitution Square, a prestigious business area in the centre of Athens. It also has branches in Tokyo, Washington, DC, and Toronto as well as other Greek offices in Athens, Crete and Piraeus, The largest part of the touring business was for executives and employees of businesses who bought their tickets from the agency branch of the business. These clients also bought family holidays and travel. In 1993 the biggest part of the clientele was middle and senior executives and, sometimes, their secretaries and assistants. Only some 10 per cent of sales came from 'dropins', people who casually dropped in at one of Amphitrion's travel offices. Mr Mitsiou had first started thinking about his teenager tour after a meeting with other agents at an International Convention, in Milan, in September 1993. He had had a discussion with a travel agent from Rome, who told him about a similar exercise he had organized successfully during the last holiday season. He was already thinking of repeating the tour in Greece. He also told Mr Mitsiou that both parents and teenagers looked forward to such tours, since it allowed them to have separate holidays. The best time for the tours was between July and August when schools were on holiday. Parents accepted the idea of the tour if the agent could guarantee proper supervision and the calibre of the people acting as guides. When Mr Mitsiou came back to Athens he repeated the idea to his friends Joan and George Lykidis, and asked them whether they would like to act as guides for the tour. Mr Lykidis was the headteachcr of one of Athens' largest schools and a professor of history. Roth Mr and Mrs Lykidis were enthusiastic about the idea and were eager to take it on. Mr Mitsiou did not know if anyone else in Greece had started such a tour. However, he knew that for some years a professor at a well-known school had organized tours of Europe for students from private schools. The activity had developed into a profitable summer business. As far as Mr Mitsiou knew, the tours were always successful and sold out each year. The teacher used no special advertising for his tours, getting most of his business

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from former students who had been on the tour themselves and who now sent their children. The tours Mr Mitsiou had in mind would focus on Greeee, including its local colour as well as the important historic and archaeological sites around the country. Characteristically, Mr Mitsiou said the nature of the tour had occurred to him after reading letters from parents and professors in the daily press. These complained about the theoretical way Greek history was taught at school. To Mr Mitsiou, it was obvious from the letters that parents and students wanted a tour visiting the sites they had studied so drily in their history classes. Parents definitely looked forward to giving their children a well-organized tour, in which they would visit all these places and in which, with proper guidance, the entire history of their ancestry would be revealed to them. Mr Mitsiou also knew very well that teenagers would not like it if the whole of the itinerary comprised only visits to museums, and to historic and archaeological sites. He would.therefore give them a chance to enjoy the beautiful seashores and beaches; to go into towns and villages; and to have fun at tavenias and discos and enjoy some dancing and entertainment. After considerable thought, he developed the following itinerary: Day 1 Departure from Athens, Thermopylae, Tempi, Mount Olympus, Thessaloniki overnight. Day 2 Morning free. Afternoon visit Eptapyrgio, Old City, St Demetrious Church, International Fairgrounds, night at a disco, stay overnight at Eptapyrgio.

Day 3 Depart for Philippi, visit sites of interest at Kavala, stay overnight on Thasos Island.

Day 4 Swimming at Golden Beach, Makrynammos, visit Necropolis Museum, return to Kavala, stay overnight.

Day 5 Depart for Polygyros, Agion Oros, swimming at Chalkidiki Beach, overnight in Thessaloniki, go to a disco.

Day 6 Leave for ancient Pella, Vergina, Tomb of Philippos, Grcvena, Metsovo, stay overnight.

Day 7 loannina, visit Vella Monastery, Ali Pasha Island in loannina lake, old town, stay overnight.

Day 8 Dodoni, Arta, Agrinio, Missolonghi, visit sites, Aetolikon, the lagoon, fishing ponds at Tholi, overnight in Missolonghi.

Day 9 Depart for Patras, visit sites, leave for Kyllini, swimming, stay overnight.

Day 10 Leave for Olympia. visit archaeological grounds, overnight in Vityna.

Day 11 Leave for Tripolis, Sparta, visit the museum, Mystras, Gythio, Diros caves, Gerolimena for swimming, overnight in Areopolis.

Day 12 Departure for Kalamata, Pylos, Mcthoni, swimming, return to Kalamata, afternoon free, disco, stay overnight.

Day 13 Leave for Tripolis, Nafplio, Tolo, swimming, Tyrins, Argos, Mycenae, Nemea, overnight in Korinth.

Day 14 Ancient Korinth, Sykion, Kiato, Nerantza for swimming, return to Athens. Mr Mitsiou knew that tours of this type could be cancelled at the last moment, which would mean that money would have to be refunded. If that happened, the total

38 Chapter 1 Marketing in a Changing World spending on the promotion of the tour would amount to a IONS of about Dr266,000. In addition, money had to be paid two months in advance lo secure good rooms, especially at places with only one hotel, and this would be a significant sum that would have to be written off it' the tour did not go ahead. By Mr Mitsicm's calculation, advertising and other expenses would bring the lost; to about Drl,000,000 if the whole tour were cancelled. With a group of 40 participants on tour, his total cost came to Dr2,260,000. From this he expected to elear 7 per cent profit. If he had more people on the tour, the profits would be greater; but George Lykidis had already said that more than 40 teenagers would be impossible to supervise properly. It was important not to cancel the tour in the first year onee it had been advertised. Word of mouth was the best way of attracting tour members, particularly as a result of previous members telling their friends. So he decided he would go ahead with as few as 20 participants, even though that meant he would make a loss. By charging more, he could make money with only 20 participants, but he did not think that he could charge more than Dr60,450 per person in the first year. When he had organized tours in the past, he had used subagents who required a 5 per cent commission. In this project, however, his margins were so small that he would not use subagents. Soon after he had finished working out the plans for the tour. Mr Mitsiou met a friend, a very renowned lawyer, who had two sons in their teens. The lawyer said that he would never let his sons go on such a tour. He added that such tours treated teenagers like sheep. Anyhow teenagers had no interest in history, no matter what newspapers said to the contrary. His idea was to give his boys some money and a couple of tickets, and to allow them to travel for as long as the money lasted. For that age group, guides were not important, and it was best to give such teenagers the chance to prove that they were responsible and could travel on their own. This worried Mr Mitsiou, since he always trusted his friend's opinions. He started to reconsider his planned tour and to think of other ways to make the tour look more attractive.

QUESTIONS

1. Has Mr Mitsiou taken a marketing-oriented approach to developing his teenage tour idea? What elements of marketing orientation, if any, are missing?

2. Is the teenage tour idea financially attractive? Does it fit the strengths of the Amphitrion Group? Is it a market that the company naturally understands?

3. Would the tour have been attractive to you as a teenager? Would this Greek tour be attractive to teenagers in your country?

4. Would you have found a similar tour of your own country attractive? Would your parents find it attractive? Who is the customer in this case and what do they want?

5. Is running a tour the only way to see if it would be successful or not? How else do you think its appeal could be tested?

6. How could the tour be changed to be more appealing and less risky?