occurs when firms obtain a higher level of consolidation or control within their own sector (e.g., luxury & budget hotel chain). Horizontal Integration – establishes adventure tourism tour operator subsidiary. Acquire controlling interest in another tour operator. 

Vertical – occurs when a corporation obtains greater control over elements of the product chain outside its own sector. Vertical Backward Integration – gains control over company that manufactures tour buses. Vertical Forward Integration – gains control over chain of travel agents

Supple & Demand

scenario 1 - If supply exceeds demand, then INCREASE DEMAND

  (assumes the demand is either below capacity or demand is low at certain times) Increase demand by product modification/diversification, alter/strengthen distribution channels, identify new/alternative demand sources, pricing discounts, redesigned promotional campaigns

Supply & Demand

Scenario 2 - If supply exceeds demand, then REDUCE SUPPLY

(assumes it’s not possible to increase demand in substantial way). Reduce supply for hotels by closing rooms/wings, closing hotel during low season. For airlines, take aircraft out of service, rent aircraft to other companies.

Supply & Demand

Scenario 3 - If supply exceeds demand then, REDISTRIBUTE SUPPLY

 (necessary when existing product is no longer suited to original demand). Redistribute hotels by converting rooms to executive suites or timeshares. For airlines, convert scheduled flights to charter flights. For theme parks, introduce new rides or renovate old rides.

Supply & Demand

Scenario 4 - If demand exceeds supply then REDUCE DEMAND

 (assumes the demand for product exceeds its capacity). To reduce demand, discourage demand by using demarketing techniques. For hotel/airline increase price of room/ticket. For national parks, introduce/increase entry fees.

Supply & Demand

Scenario 5 - If demand exceeds supply then, INCREASE SUPPLY

  (assumes the managers can accommodate a higher demand). For hotels, increase room capacity (sofas, beds, cots) infrastructure (add wing, acquire facilities).

Supply & Demand

Scenario 6 - If demand exceeds supply then REDISTRIBUTE DEMAND

(transfer demand from times of excess to times of low demand). For Caribbean resorts, use seasonal price structure. For attractions use weekday discounts on entrance fees to take pressure off busy periods. 

1. PROMOTION- media inquiries

2. RESEARCH – visitation, forecasting

3. COMBINATION of TOURISM INDUSTRY – provide support to new tourism businesses

4. INFO FOR TOURISTS – example: TIA (tourism Industry Association of America). Unifying organization for all components of tourism industry, conducts research, analysis & forecasting for various components, supports marketing programs.

Strengths, Weaknesses, Opportunities, Threats. Strengths/Weaknesses: internal environment. Opportunities/Threats: External environment

From a SWOT analysis, the business can create realistic and optimum long and short term objectives with specific marketing strategies. Then implementation can occur with control and evaluation.

1. Authentic culture genuinely shared with travelers, no commercial commodification exchanged (given artifacts).

2. Authentic culture made available to tourists for a small fee (artifacts).

3. Culture modified to meet tourist expectations and sensitivities (modification of clothing, cheap souvenirs) market dictates price.

4. Culture display completely contrived and commercialized (loss of original culture, introduction of prostitution).

Direct: advertising (print media, promotion).

Indirect: imports of goods, services (gas, food), imports of capital goods (furnishings, architects fees).  

1. Tourism perceived as trivial activity (not measurable)

2. Large-scale tourism seen as recent activity

3. Tourism seen as vocational field of study

4. Lack of clear definitions and reliable data

5. Lack of indigenous theory or strong academic tradition 

Inbound Tourist – those arriving from another country.

Outbound Tourist – those departing from usual country of residence.

1. Leisure & Recreation (3S; sea, sun, sand)

2. VFR (visiting friends & family)

3. Business (MICE; meetings, incentives, conferences, excursions)

 4. Sport

5. Spirituality

6. Health

7. Study

Place, Product, People, Price, Packaging, Programming, Promotion, Partnerships.

Relative Location – proximity to actual/potential markets. Coverage – other places as markets. Sense of Place – conceptualized by marketers

Range of goods & services, quality & warranty, After-sales service

Involvement – Service personnel (trained employees), tourists (tourist sensitivity) local residents (culture & hospitality). Database Marketing – marketing strategy based on prior customers. Analysis of data on customer behavior characteristics, etc.

Profit-Oriented

Sales-Oriented (sales volume, increase in market share, market penetration, prestige pricing)

Competition-Oriented

Cost-Oriented (establish costs first then decide on your profit margin). 

Refers to grouping together, 2 or more elements of the tourism experience (flight, accommodation, attractions).

 Addition of special events, activities, or programs to a product (more appeal & diversity).

Formed by businesses & organizations to take advantage of potential benefits.

destination life-cycle model

different elements of the tourism experience can be incorporated into this model

model should not be viewed as an unavoidable process but one that can be re-directed through appropriate management measures

Advocacy platform (1950s & 1960s)

Cautionary platform (1960s & 1970s)

Adaptancy platform (early 1980s)

Knowledge-based platform (since late 1980s).

Characterised by uncritical attitude toward tourism. Emphasis on market-product equation rather than host communities. Characterized by ‘anti-management’ perspective

Ideological challenge to advocacy platform by political left. Emphasis on destination impacts. Tourism seen as danger to host communities. Characterized by ‘management’ perspective.

Serious effort put into identifying modes of tourism. Activities which were positive for host communities. Small scale alternative to ‘mass tourism’: e.g. ‘alternative tourism’ and ‘ecotourism’. Control vested in host community vs. big government.

More objective and cognisant that tourism of any type. Results in positive and negative impacts. Effective management decisions based on sound knowledge through application of scientific methods, relevant models and theory. Recognizes sustainable ‘mass’ and ‘alternative’ tourism.

Push factors are conditions that drive people to leave their country or home. Pull factors are conditions that attract people to a different country or area. 

Geographical Proximity to Markets

Cultural Links

Availability of Services

Affordability

Peace, Stablility, Safety

Positive Market Image

Pre-Tourism Policies

Geographical Proximity to Markets

(push/pull factor)

a) infrastructure accessibility (transportation linkages) b) political accessibility (entry conditions, bilateral treaties, EU) c) availability of attractions (most important component of tourism sector, influences destination development, concept extended to VFR and MICE tourism)

Cultural Links

(push/pull factor)

 a) Travel more likely between countries sharing similar cultural elements b) Immigration flows àVFR tourism c)  Religious links -  Muslim pilgrims to Saudi Arabia, Roman Catholics to Italy (Vatican City)

Availability of Services

(push/pull factor)

    a)Tourists avoid attractions if affiliated facilities are unavailable or poor quality b) At broader destination level — basic services non-specific to tourism are critical

Affordability

(push/pull factor)

     a) Reductions in cost generate increased tourist traffic to destination b) Tourist flows are sensitive to exchange rate fluctuations

Peace, Stability, Safety

(push/pull factor)

  a) Sensitivity of tourism to instability or perception thereof (e.g. Bali, Israel) b) Influence of unstable destinations on destination regions (e.g. Middle East) c) Tourists/tourism as terrorist targets (e.g. Egypt, Bali) d) Personal safety considerations (crime, disease, natural disasters probability, traffic).

Positive Market Image

(push/pull factor)

 a) Product, for first-time visitors, is intangible: i.e. cannot be directly experienced prior to consumption b) Images used by potential visitors to choose destinations (= manipulation of public symbols to improve market image)c) Tourists must be aware of destination’s existence in order to be considered for visit
(e.g. Japan vs. Suriname) Is the image positive or negative? a) Iraq known to potential tourists, but for the wrong reasons (negative imagery through
media) b) Travel market extends images to broader region (‘guilt by association’)

Pre-Tourism Policies

(push/pull factor)

1.      National Government Initiatives a) Easing of entry requirements (e.g. EU) b) Reduction or elimination of taxes, etc. incurred by tourists or tourism (e.g. infrastructure) c) Initiation of positive domestic marketing campaigns (e.g. U.S. travel industry and government — $40 million TV ad campaign)

Demographic Factors of Tourism (4)

Reduced Family Size

 smaller family sizes allow for large amounts of time and household income, phase 4 of Burton’s phases.

Demographic Factors of Tourism (4)

Population Increase

US population – 76 million in 1900, 280 million in 2000. Introduction of health care, increase in education

Demographic Factors of Tourism (4)

Urbanization

U.S. 2000 census à 80.3% of Americans (226 million people) live in metropolitan areas. 1900 – 40% urban 2000 – 75% urban

Democratic Factors of Tourism (4)

Increased Life Expectancy

Health care, pensions. Life expectancy in 1900 – 49/46; 2000 – 79/74

Direct: $ that comes directly from customers to industry (ex: hotel à $ for a room). (Food & drink, shopping, rental, leasing, entertainment, organized, tours, etc.)

Indirect: what happens to the $ that came from the direct revenue (ex: what the hotel does w/ your money – gets filtered out to economy).

 Ex: stone thrown in a pond. Growth in the primary & secondary sectors of tourism industry. How many times $ is spent by a tourist circulates through a country’s economy (ex: new hotels à local business supply services à other companies attracted to area à more jobs indirectly created à workers spend $ in area, etc.)

8 factors in effective market segmentation; measurability, size, homogeneity, compatibility, accessibility, actionability, durability, relevance.

Market Segmentation

Measurability

  Measurability – Can target characteristics be measured in meaningful way?  (e.g., psychological criteria vs. age)

Market Segmentation

Size

Is market size large enough to warrant attention?(e.g., female war veterans > 85 years of age)

Market Segmentation

Homogeneity

Is the resultant group sufficiently distinct from other market segments? 

Market Segmentation

Compatability

Are the values, needs & wants of segment compatible with destination’s or company’s values?

Market Segmentation

Accessibility

How difficult is it to reach the market? (e.g. sex tourists)

Market Segmentation

Actionability

Is destination or company able to serve needs of market segment? (e.g., wilderness lodge & gambling)

Market Segmentation

Durability

Will segment exist long enough to justify pursuit of specialized marketing or management strategies?(e.g., WWII veterans)

Market Segmentation

Relevance

Any underlying basis for targeting particular segment? (e.g., eye color does not influence consumer behavior)

“play in order to work” mentality popular in the industrial era. “work in order to play” mentality dominant in the post-industrial era. “work to play” worked well with an increased number of vacation days in countries, flextime or rearrangement of work schedule to suit lifestyle of the worker, earned time (quota based), reduced family size.

International Stayover, International Excursionist, Domestic Stayover, Domestic Excursionist. Stayover – tourist spends at least 1 night at destination Stopover – tourist temporarily stays in location while in transit Excursionist – tourist does not have at least 1 overnight stay. THRESHOLDS: International stayover tourist (1 year max) Domestic stayover tourist (6 months max)

A system is composed of hierarchical nature, composed of subsystems, flows and exchanges of energy.

1.      Departing tourists

2.      Tourist generating region

3.      Transit route region

4.      Tourist destination region

5.      Travel & tourism industry

exploration

involvement

development

consolidation

stagnation

decline OR rejuvenation