Evaluating Strategies for Packaging Travel

Abstract

Packaging has been a popular means of selling travel for over a century and in no small way has been responsible for the development of mass markets. In the light of this, it is surprising to find that there has been little research into the packaging phenomenon, especially from the point of view of an evaluation of packaging strategies. Principally, the literature documents flows of packaged travel or trends in sales. Very few researchers have attempted to model consumer preferences for packages. This paper reviews previous published work on packaging, but then characterises it as a form of price bundling, the general term used in marketing to describe a strategy of tying the sale of one product to the purchase of another. This more general framework is used to explain strategic motivations for popular packaging methods with an emphasis on consumers' decision-making in the presence of bundles. The paper examines the claim that the travel package, and especially the fully-inclusive tour, is at an advanced stage in its product life-cycle and that it will provide little stimulus to further growth in travel. The bundling paradigm suggests that unbundling travel can succeed, but there will remain a place for packaged travel products.