Adventure Travel Sample Marketing Plan

l e p m a S o r P n a l P

Adventure Travel International (ATI) — Sample Plan

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l e p m a S o r P n a l P Table of Contents

1.0 Executive Executive Summary Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1

2.0 Situat Situation ion Analys Analysis is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1 2.1 Mark Market et Summ Summar ary y .. . .. .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. 2.1.1 Market Market Demogr Demographi aphics cs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1. 2.1.2 2 Mark Market et Need Needs s . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. 2.1.3 Market Market Trend Trends s . .. . .. . .. . .. .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . 2.1.4 Market Market Growt Growth h . .. . .. . .. .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . 2.2 SWOT SWOT Analys Analysis is . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2. 2.2.1 1 Stre Streng ngth ths s . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . . 2.2. 2.2.2 2 Weak Weakne ness sses es . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2.3 Opportuni Opportunities ties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2.4 Threats Threats . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3 Compet Competiti ition on . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4 Servic Services es . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5 2.5 Keys Keys to Succ Succes ess s .. . .. .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. .. . .. . . 2.6 Critic Critical al Issues Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.7 2.7 Macr Macroe oenv nvir iron onme ment nt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1 2 3 3 4 4 5 5 6 6 6 7 8 8 8 9

3.0 Marke Marketin ting g Strat Strategy egy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1 3.1 Miss Missio ion n .. . .. . .. .. . .. . .. . .. .. . .. . .. .. . .. .. . .. . .. . .. . .. . .. . .. . 3.2 Marke Marketi ting ng Obje Objecti ctives ves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.3 3.3 Fina Financ ncia iall Obj Objec ecti tive ves s .. . .. .. . .. . .. . .. . .. . .. . .. . .. . .. . .. . .. .. . .. . . 3.4 3.4 Targ Target et Mark Market etin ing g .. . .. . .. . .. . .. .. . .. .. . .. . .. .. . .. . .. . .. . .. . .. . . 3.5 Positi Pos itioni oning ng . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.6 3.6 Stra Strate tegy gy Pyra Pyrami mids ds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.7 Marke Marketi ting ng Mix Mix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.7.1 Services Services and Service Service Market Marketing ing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.7. 3.7.2 2 Pric Pricin ing g . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. 3.7.3 Promotio Promotion n .. . .. . .. .. . .. . .. . .. .. . .. . .. . .. . .. . .. . .. . .. . .. 3.8 Market Marketing ing Resear Research ch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9 9 9 10 10 10 11 11 12 12 12 13


Adventure Travel Int'l. -- Sample Plan 1.0 Executive Summary

Adventure Travel International (ATI) will begin operations in September, 1999 and provide adventure, sport/travel packages to people in the Pacific Northwest, specifically the greater Woodville area. The founders and employees of ATI are experienced travel-industry professionals and passionate about the activities ATI will promote and offer. An opportunity for ATI's success exists because the national tourism and travel industry is growing 4% and adventure travel 10% annually. Further, the Woodville adventure travel market is growing at least 12% annually and has no providers who specialize solely in adventure travel. ATI is poised to take advantage of this growth and lack of competition with an experienced staff, excellent location, and effective management and marketing. The Woodville area, like much of the Pacific Northwest, has a large concentration of outdoor recreation enthusiasts. These health-conscious individuals, couples, and groups interested in popular adventure sports, such as skiing, kayaking, trekking, etc., are ATI's primary customers. ATI's target market is an exploitable niche and ATI will provide a specialized and thus differentiated service. Prices will be competitive with the remainder of the market. The company's estimated sales for the first year of operations is $534,607, increasing 10% annually for the next two years.

2.0 Situation Analysis

According to the Department of Commerce, the U.S. travel and tourism industry is the nation's third largest retail industry and will be number one by the year 2000. Revenues from travel have increased approximately 100% in the last decade with U.S. travel agencies producing over $100 billion in revenues each year. Adventure travel, a segment of the travel and tourism industry, is growing at least 10% per year. More than 50% of the U.S. adult traveling population, or 147 million people, have taken an adventure trip in their lifetime, 98 million in the past five years. Thirty-one million adults have engaged in hard adventure


Adventure Travel Int'l. -- Sample Plan 2.1 Market Summary

The travel and tourism market is separated into two main categories, business and leisure travel. Each contribute about 45% to total revenues. The remainder of revenues are generated from combined business/leisure trips. The market is further separated into domestic and international travel. Domestic travel accounts for approximately 70% of industry revenues. Business travel can be divided into two categories, the medium to large corporate account, and the small independent businessman. Leisure travelers are classified according to the types of trips they take, income, or age. The four primary leisure travel groups are: 1. 2. 3. 4.

Adventure, Adventure, Special-I Special-Intere nterest, st, R&R, R&R, Honeym Honeymoons oons & Sightseei Sightseeing ng Trips. Trips. High High-I -Inc ncom ome e Trav Travel eler ers. s. Budg Budget et-C -Con onsc scio ious us Tra Trave vele lers rs.. Fami Famili lies es,, Stud Studen ents ts & Seni Senior ors. s.

Adventure travel generates approximately $15 billion of the approximately $100 billion-dollar annual industry revenues. Approximately $2-4 billion of these revenues come from California adventure travelers. Based on these and other figures, ATI estimates the Woodville adventure travel market to be approximately $6 million annually. ATI estimates that it will capture about 8% of this market.

Target Markets


Adventure Travel Int'l. -- Sample Plan Table: Market Analysis

Market Analysis Potential Customers National Adventure Travelers Woodville Adventure Travelers Internet Total

2.1.1 Market Demographics

Growth

2004

2005

2006

2007

2008

CAGR

10%

9,000,000

9,900,000

10,890,000

11,979,000

13,176,900

10.00%

15%

100,000

115,000

132,250

152,088

174,901

15.00%

20% 12.78%

3,000,000 12,100,000

3,600,000 13,615,000

4,320,000 15,342,250

5,184,000 17,315,088

6,220,800 19,572,601

20.00% 12.78%

Adventure travel falls primarily under the leisure travel category. Revenues from leisure travel earned by U.S. travel agencies exceed $50 billion annually. Adventure travel is a subcategory of leisure travel and can be further broken down into hard and soft adventure travel. Both hard and soft adventures involve physical, athletic activities. Hard adventure activities, as the name suggests, generally involve risk and require substantial athletic competence. competence. Soft adventure activities are less physically demanding and more passive than their hard adventure counterparts. Adventure travelers are slightly more likely to be men age 18-34. However an increasing number of adventure travelers are women (some statistics suggest that women comprise 49% of the adventure market). Men on average spend more than women on their adventure travels. ATI's primary customers are married couples, ages 25-35, with children and household incomes over $50,000. ATI will b e located in the heart of the Pacific Northwest. The natural beauty and abundance of outdoor activities attract many fitness oriented individuals. Per capita, the area has more people than any other in the nation who actively participate in mountain and water sports, such as skiing, climbing, kayaking, whitewater rafting, mountain biking, etc. These are the people in ATI's target market. ATI will focus on the sale and promotion of adventure travel primarily to individuals, but also to corporate clients in the Woodville area.


Adventure Travel Int'l. -- Sample Plan 2.1.3 Market Trends

One notable trend in the travel industry is increased deregulation. Deregulation has increased competition and the need for differentiation. In many cases, the prices of airfare and other travel-related services has dropped. Additional trends include caps on agency commissions by many of the larger airlines, increases in adventure travel, and reduction of profit margins. More than 50% of the U.S. adult traveling population, or 147 million people, have taken an adventure trip in their lifetime, 98 million in the past five years. Approximately 31 million adults have engaged in hard adventure activities like whitewater rafting, scuba diving and mountain biking. An additional 25 million engaged in both a hard and soft adventure activity. The growth trend in adventure travel is predicted to continue.

Market Forecast

14,000,000 12,000,000 10,000,000 8,000,000 6,000,000

National Adventure Travelers

Woodville Adventure Travelers

Internet

4,000,000 2,000,000


Adventure Travel Int'l. -- Sample Plan

Target Market Growth

20.00% 15.00% 10.00%

5.00% 0.00%

2.2 SWOT Analysis

In the following four sections are the most relevant issues to ATI's successful operation. ATI's strengths include its management, experienced staff, marketing savvy, and targeted focus. ATI will capitalize on these, and other strengths, to take advantage of opportunities and manage threats. Firm weaknesses are primarily those inherent in a start-up venture and are


Adventure Travel Int'l. -- Sample Plan 2.2.2 Weaknesses

• START-UP START-UP STATUS STATUS:: ATI is a start-u start-up p and the odds odds are stacked stacked against against small small start-up start-up companies. • LIMITED LIMITED PERSONNE PERSONNEL: L: Though Though ATI's ATI's staff is is exceptiona exceptional, l, they will will be faced with with long hours for little pay during the first two years of operation. • FINANCING FINANCING:: Preliminar Preliminary y estimates estimates of sales sales and expenditure expenditures s suggest suggest that ATI will will remain financially stable. However, unforeseen expenditures or poor sales will threaten ATI's cash position, which will be particularly vulnerable in year one.

2.2.3 Opportunities

• GROWTH GROWTH MARKET: MARKET: The The national national adventur adventure e travel market market is is growing growing 10% annually annually,, and preliminary estimates suggest that the Woodville market exceeds that growth rate. • POTENTIA POTENTIAL L TO ACHIEVE ACHIEVE SALES SALES FROM FROM THE NATIONA NATIONAL L MARKET: MARKET: As ATI establ establishes ishes itself and gains financial stability, it can begin to market its services nationally. ATI plans to begin this effort via a World Wide Web campaign in the first year of operation and diversify its communications efforts in years two and three. • POTENTIA POTENTIAL L TO BECOME BECOME A PREMIER PREMIER PROVIDE PROVIDER: R: ATI has has the managem management ent and staff staff to produce a top-quality service. • VERTICAL VERTICAL INTEGRA INTEGRATION TION:: The potential potential to integrate integrate services services and and add branches branches exists. exists.

2.2.4 Threats

• INTERNET INTERNET AND AND PRICE PRICE COMPETIT COMPETITION: ION: When When the airlines airlines were were deregulated deregulated,, price


Adventure Travel Int'l. -- Sample Plan 2.3 Competition

In the travel industry, as in other industries, there are large national chains, small homebased businesses, consolidators on the Internet, etc. Membership numbers of travel-related associations give some indication of the number of participants in this market. The American Society of Travel Agents (ASTA) reports 25,000 members in 135 countries, most of whom are small businesses. The Association of Retail Travel Agencies (ARTA) has another 3,000 members. In addition, there are many agencies not affiliated with these associations but with one or more of the approximately 35 travel-industry organizations in the country. ATI has approximately 30 immediate competitors in the greater Woodville area, including two agencies that are branches of national travel agency chains. Direct national competitors include:

1.

2.

3.

Rollins Rollins & Hayes: Hayes: Based Based on the the east coast, coast, Rollins Rollins & Hayes Hayes is the the most most well known known and and respected adventure travel agency in the world. They have provided adventure travel packages for over 20 years and have successfully integrated travel agency services and adventure travel activities. This offers them complete control over the entire vacation. They have the advantage of an established reputation, high-quality trips, economies of scale, and strategic alliances. However, their packages are expensive and appeal primarily to a high-income clientele. Sundance Sundance Travel Travel:: Based Based in Colorado, Colorado, Sundan Sundance ce is a traditi traditional onal agency agency and and has been been in business for 10 years. They have gradually made the move towards becoming adventure travel specialists and are now recognized as such. Their strengths are experience, reputation, and financial solvency. Weaknesses may include high personnel and management turnover and the lack of a clear plan for future growth. Global Global Adventur Adventure e Travel: Travel: Global Global was was establish established ed in 1995 1995 and has succes successful sfully ly established themselves as adventure travel specialists. They are based in the Los Angeles area. Global has done a good job positioning itself through successful marketing communications and management. The Los Angeles area contains a large


Adventure Travel Int'l. -- Sample Plan Table: Growth and Share Analysis Analysis

Growth and Share Competitor Rollins & Hayes Sundance Global Travel Northwest Woodville Travel Other Average Total

2.4 Services

Price $1,100 $975 $950 $1,000 $965 $0

Growth Rate 3% 5% 10% 4% 0% 0%

Market Share 23% 8% 7% 1% 1% 0%

$831.67 $4,990.00

3.67% 22.00%

6.63% 39.80%

ATI is a full service agency and sells standard travel agency goods and services, including airfare and travel packages. Additional services include assistance with passports, providing access to top-of-the-line equipment and supplies, and a superior offering that includes access to better than average terrain and activities, accommodations, and entertainment. The value added of ATI's offering is its knowledge and expertise, competitive rates, and specialty focus on adventure travel, which translate into increased satisfaction for the customer.

2.5 Keys to Success

• Effectiv Effectively ely segment segment the travel travel market market and and target advent adventure ure traveler travelers. s. • Successf Successfully ully positio position n ourselves ourselves as as adventure adventure travel travel specia specialist lists. s. • Communic Communicate ate the differen differentiat tiation ion and qualit quality y of our offering offering through through persona personall interaction and media. • Develop Develop a repeat-bus repeat-business iness base of loyal loyal customers. customers.


Adventure Travel Int'l. -- Sample Plan 2.7 Macroenvironment

• Disposable Disposable incom income e is high but but leisure leisure time time is limited limited and contes contested ted by other other responsibilities and recreation options. • Due to to a good good economy economy,, travel travel and and tourism tourism is growing growing.. • Population Population segment segments s have different different needs needs and wants. wants. This requires requires effectiv effective e target marketing. • Internet Internet sales sales threaten threaten the tradition traditional al firm, and technol technologica ogicall advances advances require require greater knowledge and sophistication in most industries. • Internati International onal condition conditions, s, which are favorable favorable,, greatly effect effect the industry. industry. Politica Politicall unrest, military action, and other issues determine availability to many foreign destinations.

3.0 Marketing Strategy

ATI believes that the goal of business is to create and keep customers. Its marketing strategy will reflect this goal as it builds its reputation in the Woodville area. Though ATI operates in the travel industry, it provides much more than travel. ATI provides adventure and freedom. Many of ATI's customers spend 50 weeks of the year in an office. ATI offers people the ability to get away and remember how much they love the challenge and excitement of an athletic endeavor. ATI will promote the benefits of adventure travel. These benefits include better health, excitement, personal growth, ear-to-ear grins, and a whole lot of fun. ATI will also promote the benefits of its services. These benefits include saving time and money, and confidence in the vacation's success.

3.1 Mission


Adventure Travel Int'l. -- Sample Plan 3.3 Financial Objectives

• Generate Generate sales sales of approxim approximately ately $550,0 $550,000 00 in year year one and increa increase se sales sales 10% annually. • Capture Capture and and mainta maintain in a gross margin margin of of 18-20%. 18-20%. • Achiev Achieve e posit positive ive net net worth worth by year year two. two.

3.4 Target Marketing

ATI will target the following groups:

• Couples Couples and individu individual al adventure adventure travel travelers: ers: This This is the custome customerr group that that meets the the demographic profile for adventure travelers -- ages 25-35, married, with household income greater than $50,000. • Group advent adventure ure traveler travelers: s: These These are groups groups that that belong belong to local local athletic athletic organizations, such as cycling or kayaking clubs. • Corporate Corporate adventu adventure re travelers: travelers: ATI will will target local local businesse businesses s in an attempt attempt to secure corporate accounts. ATI plans to focus its initial efforts on the adventure travel market in the greater Woodville area. As ATI grows, marketing efforts will expand. The major purchasers that fit ATI's target market are located in urban areas within these states: 1. 2. 3. 4. 5. 6

California Florida New York Texas Illinois N d


Adventure Travel Int'l. -- Sample Plan 3.6 Strategy Pyramids

STRATEGY 1: Develop brand recognition through the use of effective advertising, marketing communications and promotion. Tactic: Develop a marketing mix designed to target the Woodville market. •

Program: Program: Print Print and electronic electronic advertis advertising ing campaign campaign,, using specialty specialty publicati publications ons and local radio as primary media. • Program: Program: Use Use strategic strategic allianc alliances es to conduct conduct promoti promotions ons and giveaw giveaways. ays. Tactic: Expand brand recognition to the national market through increased industry participation and WWW presence. •

Program: Program: Utilize Utilize the network networking ing benefits benefits of industr industry y associatio associations, ns, trade trade shows, shows, and publications. • Program: Program: Develop Develop and promote promote ATI's ATI's website. website. The The availabili availability ty of informat information ion and the the ability to schedule and purchase online will be beneficial to the customer and ATI. STRATEGY 2: Increase revenues and reduce costs by establishing repeat and corporate customers. Tactic: Customer satisfaction program. •

Program: Program: Focus Focus ATI's efforts efforts on customiza customization tion of adventur adventure e travel and and utilization utilization of its core competencies. ATI would rather recommend that a potential customer purchase elsewhere than provide a trip outside of its expertise. • Program: Program: Post Post purchase purchase and post post trip followfollow-up. up. Research Research indica indicates tes that that the communication between the firm and the customer after the sale positively influences repeat purchase.


Adventure Travel Int'l. -- Sample Plan 3.7.1 Services and Service Marketing

ATI will sell standard travel agency goods and services including airfare and travel packages. Additional services will include assistance with passports, providing access to top-of-the-line equipment and supplies, and a superior offering that includes access to better than average terrain and activities, accommodations, and entertainment. The value added of ATI's offering is its knowledge and expertise, competitive rates, and specialty focus on adventure travel, which will translate into increased assurance and satisfaction for the customer. ATI's decision to focus on adventure travel was made because economic indicators suggest that an increased demand for adventure travel services exists, the Woodville area does not have a true adventure travel specialist, and members of the ATI team are experienced and enthusiastic about adventure travel activities. activities. It is hoped that this enthusiasm will be communicated to the customer, and ATI's experience will translate into satisfaction and repeat business.

3.7.2 Pricing

Much of ATI's pricing is determined by market standards. ATI will attempt to maintain margins of 10% on all airline travel. Margins on all other products and services vary depending upon the provider but are expected to average 20%. ATI will make every effort to maintain a competitive pricing policy. However, as ATI builds its reputation as the premier provider of adventure travel, it expects to earn the ability to charge a premium for its services.

3.7.3 Promotion


Adventure Travel Int'l. -- Sample Plan 3.8 Marketing Research

Ongoing industry analysis is conducted by several organizations, including the U.S. Department of Commerce, and is available for sale. Research on the travel and tourism industry will be purchased as necessary. Demographics and spending patterns of adventure travelers have been secured and used to formulate communications communications strategy. ATI will conduct customer surveys when a specific research problem is identified. ATI subscribes to several industry publications and will attend trade shows to stay abreast of relevant issues.

4.0 Financials, Budgets, and Forecasts

ATI's marketing budget for year one of operations is taken from the start-up investment and is equivalent to approximately 6% of anticipated first-year revenues. The marketing budget will be evaluated quarterly, and at the end of year one, adjustments will be made to advertising schedules, media vehicles, effective frequency, etc. as necessary. The following issues are relevant to ATI's marketing efforts: •

As a start-up start-up,, ATI has has no baseline baseline by by which it it can determin determine e the effects effects of its its marketing efforts on sales. Year two marketing activities will benefit from the financial results of year one operations. • The marketi marketing ng budget has has been establish established ed based on anticip anticipated ated revenues revenues.. ATI plans plans to employ the use of more sophisticated budgeting methods as a baseline is established. • Much of ATI's ATI's marketing marketing efforts efforts will involve involve personal personal interac interaction tion with with customers customers in the Woodville area. ATI must attempt to conserve resources when possible, especially in the early stages of operation. Sweat equity in marketing and other activities will be critical to ATI's success.



Break-even Analysis

$2,500 $2,000 $1,500 $1,000 $500 $0 ($500) ($1,000) ($1,500) $0

$1,900

$3,800

$5,700

$7,600

Monthly break-even point

Break-even point = where line intersects with 0

Table: Break-even Analysis

Break-even Analysis: Monthly Units Break-even Monthly Revenue Br Break-even Assumptions: Average Per-Unit Revenue Average Pe Per-Unit Va Variable Co Cost

5 $4,286

$950.00 $617.50

$9,500



Monthly Sales Forecast

$80,000 $70,000 $60,000 $50,000

Woodville Market (Individual)

National Market

$40,000

Internet

$30,000

Corporate Market

$20,000 $10,000 $0

Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

Table: Sales Forecast

Sales Forecast Sales Woodville Market (Individual) National Market Internet Corporate Market Total Sales

2005 $427,685 $42,768 $10,693 $53,461 $534,607

2006 $382,245 $70,568 $47,046 $88,210 $588,069

2007 $258,751 $97,032 $97,032 $194,063 $646,878

2008 $284,626 $106,735 $106,735 $213,469 $711,566

2009 $313,089 $117,409 $117,409 $234,816 $782,722


Adventure Travel Int'l. -- Sample Plan 4.3 Expense Forecast

The marketing budget is between 5% to 6% of revenues. ATI's marketing director will assume responsibility for everything except the website development budget. All ATI staff are salaried, so labor hours, other than those included in the directors salary, are not included in the budget. They will, however, play a key role in many of the planned promotional activities. All members are expected to take part in the promotion of ATI. There are no 9-5 positions.

Monthly Expense Budget

$2,500 $2,000 $1,500 $1,000

Print and Radio Advertising

Personal Selling and Promotion

Other

$500 $0


Adventure Travel Int'l. -- Sample Plan 4.4 Linking Sales and Expenses to Strategy

ATI's marketing efforts have been designed to improve sales. ATI's director of marketing will be responsible for tracking the various programs. If measurable results are not realized, changes will be made to the marketing mix. Other factors, such as economic recession, sales below estimates, high costs associated with the use of certain media, and others may influence ATI's marketing budget and mix.

Sales vs. Expenses Monthly

$80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0

Sales

Expenses

Apr May Jun

Jul Aug Sep Oct Nov Dec Jan Feb Mar



Contribution Margin Monthly

$12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $0

Apr May Jun

Table: Contribution Margin

Contribution Margin Sales Direct Cost of Sales Other Variable Costs of Sales Total Cost of Sales

Jul Aug Sep Oct Nov Dec Jan Feb Mar

2005 $534,607 $427,686 $0 -----------$427,686

2006 $588,069 $464,575 $0 -----------$464,575

2007 $646,878 $498,096 $0 -----------$498,096

2008 $711,566 $547,906 $0 -----------$547,906

2009 $782,722 $602,696 $0 -----------$602,696


Adventure Travel Int'l. -- Sample Plan 5.1 Implementation Milestones

• ATI's ATI's grand opening opening event event will take take place place in the first first quarter. quarter. This will will be a combined combined effort with a local rock gym, one of ATI's strategic alliances. The event will be hosted by a local radio station and will include a prize giveaway of an adventure travel package. • ATI will will begin its corpor corporate ate account account marketi marketing ng in the first first quarter quarter and hopes hopes to secure secure at least one corporate account during that time. • ATI's ATI's website website should should be operationa operationall by the middle middle of the second second quarter quarter of operatio operation. n. The website will be capable of online transactions with secure site protections. ATI banners will be placed at several World Wide Web locations. • Tracking Tracking of ad ad exposure exposure will begin begin in the the first first month month of operation operation.. ATI has has a designated 800 number that is only used in advertising.

Milestones

Media Campaign Strategic Alliance Development Grand Opening Promotion First Trade Show Web Site Completion Corporate Account Program


Adventure Travel Int'l. -- Sample Plan 5.2 Marketing Organization

Marketing Director Jordan Barnes will be responsible for the planning and implementation of ATI's Advertising, Communications, and Promotion activities. Mr. Barnes will work under the supervision of Shea Delaney and will instruct all ATI members in their roles in the marketing activities. ATI may use marketing consultants from a local firm to help with strategy.

5.3 Contingency Planning

These are the issues that will most likely call for changes in ATI's operations. The threats and the manner with which they will be dealt are discussed: INTERNET AND PRICE COMPETITION: When the airlines were deregulated, price competition increased. Further, the Internet has provided a sales medium for consolidators who compete on price, and has also given consumers the ability to plan and arrange trips for themselves. Thus the traditional agency faces greater competition. ATI plans to compete with other firms on the Internet by having its own website on which to conduct communications and sales. Price competition is a problem in any industry. ATI will not compete on price, mainly because it cannot win doing so. ATI will continue to communicate the benefits of its offering. It will attempt to remain competitively priced but will not defend its price structure. LOCAL COMPETITION (EXISTING AND POTENTIAL): There are no agencies in the Woodville area that specialize solely in adventure travel. However, any one of the approximately 30 agencies can book an adventure trip. Moreover, additional adventure travel specialists may follow ATI's lead. Competition is already present. It is likely that additional agencies may begin to present themselves as adventure travel specialists. It is also possible that new agencies will enter the Woodville market with a similar offering. ATI will attempt to establish itself as a market leader and maintain that position if new competitors emerge. Additional safeguards include ongoing analysis of additional segments of the travel market in which ATI

l p m a S o r P n a l P g n i t e k r a Adventure Travel Int'l. -- Sample Plan Appendix

Appendix Table: Sales Forecast

Sales Forecast Sales Woodville Market (Individual) National Market Internet Corporate Market Total Sales Direct Cost of Sales Woodville Market (Individual) National Market Internet Corporate Market Subtotal Direct Cost of Sales

Apr $20,000 $2,000 $500 $2,500 $25,000

May $22,000 $2,200 $550 $2,750 $27,500

Jun $24,200 $2,420 $605 $3,025 $30,250

Jul $26,620 $2,662 $666 $3,328 $33,276

Aug $29,282 $2,928 $732 $3,660 $36,602

Sep $32,210 $3,221 $805 $4,026 $40,262

Oct $35,431 $3,543 $886 $4,429 $44,289

Nov $38,974 $3,897 $974 $4,872 $48,717

Dec $42,872 $4,287 $1,072 $5,359 $53,590

Jan $47,159 $4,716 $1,179 $5,895 $58,949

Feb $51,875 $5,188 $1,297 $6,484 $64,844

Mar $57,062 $5,706 $1,427 $7,133 $71,328

Apr $16,000 $1,600 $400 $2,000 $20,000

May $17,600 $1,760 $440 $2,200 $22,000

Jun $19,360 $1,936 $484 $2,420 $24,200

Jul $21,296 $2,130 $533 $2,662 $26,621

Aug $23,426 $2,342 $586 $2,928 $29,282

Sep $25,768 $2,577 $644 $3,221 $32,210

Oct $28,345 $2,834 $709 $3,543 $35,431

Nov $31,179 $3,118 $779 $3,898 $38,974

Dec $34,298 $3,430 $858 $4,287 $42,872

Jan $37,727 $3,773 $943 $4,716 $47,159

Feb $41,500 $4,150 $1,038 $5,187 $51,875

Mar $45,650 $4,565 $1,142 $5,706 $57,062


Appendix Table: Table: Marketing Expense Budget Budget

Marketing Expense Budget Print and Radio Advertising Personal Selling and Promotion Other Total Sales and Marketing Expenses Percent of Sales Contribution Margin Contribution Margin / Sales

Apr $1,250 $708 $417 -----------$2,375 9.50% $2,625 10.50%

May $1,250 $708 $417 -----------$2,375 8.64% $3,125 11.36%

Jun $1,250 $708 $417 -----------$2,375 7.85% $3,675 12.15%

Jul $1,250 $708 $417 -----------$2,375 7.14% $4,280 12.86%

Aug $1,250 $708 $417 -----------$2,375 6.49% $4,945 13.51%

Sep $1,250 $708 $417 -----------$2,375 5.90% $5,677 14.10%

Oct $1,250 $708 $417 -----------$2,375 5.36% $6,483 14.64%

Nov $1,250 $708 $417 -----------$2,375 4.88% $7,368 15.12%

Dec $1,250 $708 $417 -----------$2,375 4.43% $8,343 15.57%

Jan $1,250 $708 $417 -----------$2,375 4.03% $9,415 15.97%

Feb $1,250 $708 $417 -----------$2,375 3.66% $10,594 16.34%

Mar $1,250 $708 $417 -----------$2,375 3.33% $11,891 16.67%


Appendix Table: Table: Contribution Margin

Contribution Margin Sales Direct Cost of Sales Other Variable Costs of Sales Total Cost of Sales Gross Margin Gross Margin % Marketing Expense Budget Print and Radio Advertising Personal Selling and Promotion Other Total Sales and Marketing Expenses Percent of Sales Contribution Margin Contribution Margin / Sales

Apr $25,000 $20,000 $0 -----------$20,000 $5,000 20.00%

May $27,500 $22,000 $0 -----------$22,000 $5,500 20.00%

Jun $30,250 $24,200 $0 -----------$24,200 $6,050 20.00%

Jul $33,276 $26,621 $0 -----------$26,621 $6,655 20.00%

Aug $36,602 $29,282 $0 -----------$29,282 $7,320 20.00%

Sep $40,262 $32,210 $0 -----------$32,210 $8,052 20.00%

Oct $44,289 $35,431 $0 -----------$35,431 $8,858 20.00%

Nov $48,717 $38,974 $0 -----------$38,974 $9,743 20.00%

Dec $53,590 $42,872 $0 -----------$42,872 $10,718 20.00%

Jan $58,949 $47,159 $0 -----------$47,159 $11,790 20.00%

Feb $64,844 $51,875 $0 -----------$51,875 $12,969 20.00%

Mar $71,328 $57,062 $0 -----------$57,062 $14,266 20.00%

Apr $1,250 $708 $417 -----------$2,375 9.50% $2,625 10.50%

May $1,250 $708 $417 -----------$2,375 8.64% $3,125 11.36%

Jun $1,250 $708 $417 -----------$2,375 7.85% $3,675 12.15%

Jul $1,250 $708 $417 -----------$2,375 7.14% $4,280 12.86%

Aug $1,250 $708 $417 -----------$2,375 6.49% $4,945 13.51%

Sep $1,250 $708 $417 -----------$2,375 5.90% $5,677 14.10%

Oct $1,250 $708 $417 -----------$2,375 5.36% $6,483 14.64%

Nov $1,250 $708 $417 -----------$2,375 4.88% $7,368 15.12%

Dec $1,250 $708 $417 -----------$2,375 4.43% $8,343 15.57%

Jan $1,250 $708 $417 -----------$2,375 4.03% $9,415 15.97%

Feb $1,250 $708 $417 -----------$2,375 3.66% $10,594 16.34%

Mar $1,250 $708 $417 -----------$2,375 3.33% $11,891 16.67%

Adventure Travel Sample Marketing Plan

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