The Importance of Online Advertising to Hospitality and Tourism - Research Proposal Example

? An Investigation into the Importance of Online Advertising to Hospitality and Tourism An Investigation into the Importance of Online Advertising to Hospitality and Tourism 1. Introduction The hospitality industry, like most industries, has been impacted by the tools that the internet provides for advertising. Online capacities for the hospitality industry do not only include advertising, but the potential for transactions making travel a more accessible experience. Advertising is highly competitive on the internet with someone always coming up with new ways to attract the attention of an audience that is deluged with information all coming at them at once. The hospitality industry benefits from everything from data mining techniques to websites providing specific information. Without a web based presence it is unlikely that a hospitality industry entity would have success in this globalised and interconnected world. Through an examination of the modern travel practices of th 21st century, the benefits of the internet as a means of advertising will be revealed. 1.1 Background Zhou (2004, p. 8) explains that advantages of the internet for advertising opposed to print medium which is static, is that the internet is a dynamic and interactive method of advertisement. The internet is an environment in which print, images, and movement can all be utilized in order to attract the consumer to the product. The hospitality industry has benefited greatly by the internet because consumers have been able to cut out the middle conduit of the travel agent. Consumers can research and look at all kinds of options that they would not have been privy to previous to the capacities that opened up through the internet. The internet provides a space in which an aspect of the hospitality industry can open up the information about their services to the consumer. The consumer can look at the amenities, location, costs, and particulars of using a service without having to contact a human element. Reservations for flights, hotels, rental cars, and for attractions at a destination can be done in a few clicks of the mouse. Websites that accumulate information about holidays allow comparison shopping as well as getting the best price possible. 1.2 Research Questions The following research questions will frame the inquiry for this paper: 1. In what ways has the internet changed the hospitality industry? 2. What does a consumer find when they search for information regarding their travel needs? 3. What are the methods used for the hospitality industry to connect with consumers? 4. What methods used by the hospitality industry might be considered unethical when dealing with consumers searching the internet? 5. What disadvantages can be found for the consumer as they use the internet as a means to book their travel? 6. What are the advantages of the internet as a consumer looks to book travel? By using these questions to frame the inquiry, this research project will be able to focus on the internet as a source of advertising for the hospitality industry and the effect that it has had on consumer travel practices. 1.3 Theoretical Foundation The study that is being proposed is a quantitative study that is based upon a survey instrument. Quantitative study often begins by wanting to test a conceptual model of the question. Theory allows for predictions on which phenomena will manifest (Polit and Beck 2008, p. 57). This study predicts that the outcome to the study will suggest that internet marketing is an important part of hospitality industry advertising and that consumers have changed their travel practices as a result. The following hypotheses will frame the inquiry that is intended for this paper: Hypothesis 1: The internet has changed the way in which the hospitality industry markets to consumers. Alternative Hypothesis 1: The internet has had no effect on the way in which the hospitality industry markets to consumers. Hypothesis 2: Internet advertising has changed the way in which consumers plan for holidays and travel. Alternative Hypothesis 2: Internet advertising has had no effect on the way in which consumers plan for holidays and travel. Through examining the meaning of theses hypotheses as they relate to the research that will be conducted, information will arise that can contribute to the lexicon of information on hospitality industry marketing. 2.0 Literature Review Lier and Muller (2011, p. 3) describe the internet as a ‘gale of destructive force’ as it swept through industries and forever transformed them into new versions. Lier and Muller (2011, p. 3) go on to write that “the internet has increased buyer power and reduced switching costs, limited the barrier to entry, intensified competition on a global scale and facilitated disintermediation”. The internet has accomplished a stronger, more direct line between the consumer and the industry. The way in which the conduit is formed is through advertising. Reid and Bojanic (2010, p. 27) discuss the changes in the hospitality industry as numerous, but most relevant to direct marketing and mass customisation. Through internet connectivity to consumers, direct marketing allows for the industry to create contact without an intermediating influence. Mass customisation comes from everything from choosing seats on an airplane to choosing check out time and amenities from menus at a hotel. The experience of travel can be highly customisable from options that are given to the consumer while using the internet and long before the travel event takes place. The changes that have occurred through internet advertising have had a direct effect on competitive pricing. Where the prices of hotels were only available through travel agents and through individual inquiry at one time, current models of pricing competition place hotels in direct comparisons through internet sites that are designed for this type of comparison. Not only are the prices compared, but the amenities and reviews as well. Where the star system was once a reference to the assessments of professional travellers who rated hotels after staying in them, most people look for consumer reviews that are given star ratings to judge a hotel. This different model of referral leaves hotels vulnerable to the whims of consumers who are not consistent in when and why they choose to rate a hotel (Enz 2010, p.51). Xu and Chan (2008, p. 174) discuss that the development of brand equity through internet advertising has had an impact on the growth of different brands within the hospitality industry. Direct and indirect experiences are responsible or building brand equity through consumer interactions. Those interactions are now accessible to other travellers through the internet as consumers share their experiences with one another. Advertising on the internet can take a number of different forms. This includes advertisements that are similar to print advertising and static, interactive advertising, advertising that is the result of data mining which targets consumers based on their previous searches, and the social media. The social media are sites that connect people based on similar backgrounds and interests. Connecting through the social media allows an industry to connect through a series of different formats. This can be direct marketing or through indirect marketing that includes the actions of consumers (Seth 2012, p. 3). The social media has the advantage of creating two way communications between the consumer and the brand and as a result is a very inexpensive way to connect to consumers (Seth 2012, p. 4). The following model represents the impact of internet marketing on an industry in relationship to social media advertising: Marketing Model (Preeti 2008) The importance of seeing the relationship of the consumer to advertising on the internet is that it is user generated and participatory in most cases. Although there are a variety of spontaneous generations of advertising on the internet, the most effective come from interested consumers actively seeking out travel resources. Traditional marketing takes place through brand generated interest and one way connections to consumers, but it also takes place through user generated information such as reviews and blogs. This allows for consumer to consumer generation of advertising. 3.0 Research Questions and Objectives The research that is being conducted for this study is based upon the premise that the internet has changed both the advertising and consumer practices as they relate to the internet. The questions that have been used to frame this inquiry are based on the following aims: To look at the hospitality industry through the changes that have taken place in advertising practices since the growth of the internet To look at the practices by consumers in their research and planning of travel as it relates to the internet To determine the advantages of the internet to hospitality industry advertising objectives To determine the level of importance of internet advertising for the hospitality industry The following objectives will be used in order to sculpt the scope of the project as it focuses in on the importance of advertising for the hospitality industry: To look at the relevant literature that can shed light on the topic and to critically evaluate it in relationship to the research questions To look at the experiences of consumers with searching the internet and planning their vacations To see if domestic and international travel practices are different when approached through internet advertising and the consumer To determine if there have been significant changes in the hospitality industry that can show importance for the use of internet advertising The research questions that have been defined for this study discuss the various stakeholders in the hospitality industry and the impact that the internet advertising potentials have had on travel. The first question asks about the changes that have been made in relationship to the hospitality industry through internet advertising and will be answered through statistical inquiry as well as anecdotal information on the topic. Secondary research will provide answers as to how the hospitality industry is currently using the internet for expanding their opportunities with consumers. The research into consumer experiences would best be calculated through a quantitative study that is conducted through a survey instrument. Understanding how the use of internet advertising is affecting travel and consumers can help industry leaders to better understand the importance of internet advertising for their section of the industry. The research that is being proposed in this paper is a quantitative study on the hospitality industry and the importance of internet advertising. Secondary research will provide for critical inquiry into the background and surrounding issues in the study. Primary research will be conducted through contacting travel consumers about their experiences with travel industry advertising. In critically examining travel practices and the impact of advertising on the internet by hospitality industry members, the importance of that channel of marketing can be addressed. Bibliography Enz, Cathy A. 2010. Hospitality Strategic Management: Concepts and Cases. London: John Wiley & Sons. Hudson, Simon. 2008. Tourism and Hospitality Marketing: A Global Perspective. London: SAGE. Lier, Christoph M. & Muller Christoph. 2011. The impact of the internet and social media on the hotel industry. Norderstedt, Germany: GRIN Verlag. Polit, Denise F, and Cheryl T. Beck. 2008. Nursing Research: Generating and Assessing Evidence for Nursing Practice. Philadelphia: Wolters Kluwer Health/Lippincott Williams & Wilkins. Preeti, Chaturvedi. 2008. Social media in recession. Wordpress. [Online] Retrieved from http://chaturvedipreeti.wordpress.com/2008/12/03/social-media-in-recession/ Seth, G. 2012. Analyzing the Effects of Social Media on the Hospitality Industry. PDF [Online] Retrieved from http://digitalscholarship.unlv.edu/cgi/viewcont ent.cgi?article=2338&context=thesesdissertations&sei-redir=1&referer=http% 3A%2F%2Fscholar.google.com%2Fscholar%3Fas_ylo%3D2009%26q%3Dintern et%2Badvertising%2Bhospitatlity%2Bindustry%26hl%3Den%26as_sdt%3D0%2 C34#search=%22internet%20advertising%20hospitatlity%20industry%22 Reid, Robert D, and David C. Bojanic. 2010. Hospitality Marketing Management. London: John Wiley & Sons. Zhou, Zongqing. 2004. E-commerce & Information Technology in Hospitality & Tourism. New York: Thomson Learning. Xu, J. B., & Chan, A. 2010. A conceptual framework of hotel experience and customer-based brand equity: Some research questions and implications. International Journal of Contemporary Hospitality Management, Vol. 22, No. 2, 174-193. Read More