Importance of E-Tourism - Essay Example

Executive Summary Travel and tourism is the industry which connects the people, culture, and places. People leave their place and go somewhere for different purposes and from the tendency of the people to go and visit to different places, the concept of tourism industry flourished. This industry can be fostered by using new technologies, basically electronics and telecommunication. In this paper the researcher has tried to find out the facts which reveal the close relationship between Information Technology and tourism industry. In the introduction the concept of tourism is explained with definition. The status of today’s tourism industry is explained. The various objectives of the paper are also described In the main body of the paper the discussion is mainly on the relationship between the online technology and tourism. For this discussion one of the most popular tourism industries in America named Trek America is taken for the study. It is the attempt of the researcher to find out what types of new technologies are used by Trek America and how are they performing their business online? The internet is playing a very crucial role in the development of any business. It helps the business to get maximum number of cross border customers, rapid and efficient service, and establishment of business worldwide. Every invention and technology has its pros and cons. Like that e-business in tourism also has some disadvantages and because of those disadvantages the company may face failure in near future. It is very important to find out effective solution for the problem if they really want to catch the customer from all over the world. As of now internet is the only important tool reach the product and services worldwide. So it is very important to create the image of the company in the minds of the potential customers. All the data are collected basically by secondary sources, such as books, articles, blogs and the online comments of the people. No primary data will be used for this paper. Table of Contents Executive Summary …………………………………………………………..1 Table of Contents ………………………………………………………………3 1. Introduction ……………………………………………………………. 4 2. Aims and Objectives……………………………………………………7 3. Discussion (Main Body) ……………………………………………… 8 3.1 The concept of E-Business and its use in tourism sector…...........8 3.2 Trek America – E-Tourism 3.2.1 Website……………………………………………………………….9 3.2.2 Online Brochure…………………………………………………..9 3.2.3 Virtual employment process…………………………………….9 3.2.4 Booking Trek online……………………………………………..10 3.2.5 Selecting trek destination and further information………10 3.2.6 E-Tourism and communication……………………………….11 3.3 Online Visa Waiver Program……………………………………………..12 3.4 The Prospects of E Business in Tourism………………………………12 3.5 E-Tourism platform…………………………………………………………13 3.7 The possibilities of failure of E tourism………………………………..14 4. Conclusion…………………………………………………………………….16 Bibliography 1. Introduction: Travel is one of the major needs of human beings. Various purposes are there which make the people travel. Tourism is defined as a travel or journey for the sake of recreation, leisure or business purposes. Tourism has become a popular global leisure activity. Thus the ranking of tourism in foreign trade is on the top and it is one of the most important factors from social and economic point of view. Tourists are generally in need of the static information such as the climate, location, spots of attraction etc while dynamic information such as the schedule of the bus, train, air, tariffs etc. This information is called dynamic information as it is not fixed but it changes constantly. In the trend of globalization like other industries the tourism industry has become more sophisticated. This sector has crossed the boarders of the countries and it has become global. “Tourists and travel agents alike turn to the Web as their first source of information on a potential destination for themselves or their clients, and they use e-mail for fast, efficient and inexpensive communication to have their questions answered and their impressions confirmed. The industry is expanding day by day.” (Makuni 2007) “In 2008, there were over 922 million international tourist arrivals, with a growth of 1.9% as compared to 2007. International tourism receipts grew to US$944 billion (euro 642 billion) in 2008, corresponding to an increase in real terms of 1.8%.” (UNWTO 2009) The tourism economy is one of the fastest growing activities in developed countries (WTO 2003). This is the reason why this industry has attracted the attention of many people and it is beckoning many innovative businessmen to start the business in tourism related sectors. Traveling is not a new concept but it has been going since long back. In ancient time also man used to travel from one place to another for various purposes. The sailor wandered long long ways for adventure and discovering the hidden lands and natural mysteries on the earth. People used to travel for education in the past also. But in those days it was not a special field and the not a developed and sophisticated industry as it is today. As compared to the past the activity of travel and tourism has become very complex as well as sophisticated. This is of course because of the IT application in tourism industry. Few years back the information used to be provided to the customers through printed materials such as pamphlets, broachers, directories, tourist guide books etc. But in the last few decades there was a rapid advancement in the field of information and technology especially in tourism industry. Proper information is the key factor in tourism. The customers require thorough information about the place they are going to visit or intend to visit. Some major elements regarding the information are as follows: Geographical information such as location, climate etc Special attractions of the place The culture, custom of the land Accessibility via road, rail or air Accommodation and other facility Shopping items Recreation facilities Proper season to visit the place Entry or exit formalities for the tourists Tourism business has become online business now. Almost all small scale, medium scale and large scale companies use new technology for each and every activity related to tourism. According to O’Connor (1999), the main advantages that the internet provides as a marketing medium for travel and tourism sector are; the global market reach the customers who access the websites are much more interested rather than in a conventional marketing communication where the message is targeted indiscriminately the websites are not affected by capacity constraints Both side communication facilitated by the internet. The researcher aims at investigating the use of technology in tourism business and the future prospects likely to be achieved by the company by using the advanced technology. These companies arrange domestic as well as international tours for the local and the global customers. Due to globalization it is not enough to depend on domestic business. It will not be affordable for any travel company to depend on just domestic tours for creating global image. Almost all companies, from all over the world, are trying to become global. Being global has become possible only due to the globalization. The range of businesses has expanded and the tourist companies are finding new cross boarder opportunities. The tourism business needs to be an E-Business to face the threats in the tourism industry and to achieve competitive advantage. “Faced with this tremendous pressure to survive, travel agencies have used various strategies to cope with the new reality.” (Zhou2004) Here in the research paper the researcher is discussing about the use of technology and their prospects in tourism sector by taking into consideration an American Tourist Company “Trek America.” Trek America basically formed out of the curiosity and adventures. It is a provider of small group tours in North America. It includes US, Alaska, Canada, and Mexico. It arranges trips to big cities, national parks, remote beaches and many wonderful places of the world. Trek America was founded in USA in 1971. 2. Aims and Objectives: The study basically aims at investigating about the maximum utilization of new and advanced technology in tourism companies. The concept of E-Business is not at all new concept but it is the need of the global business scenario. Like other businesses, tourism industry is also adopting new ways of technology and e business to reach to the maximum number of customer and to improve the service and to increase the efficiency. The major factor responsible for expansion of tourism industry from domestic to international level is the advancement in information technology. Here the mean of advanced technology is of course E business or online activities. The aims and objectives of this study are related to the same issue. The objectives are as follows: To investigate the influence of internet and other new technology on the entire tourism sector with the reference of the company Trek America To find out how the business of Trek America is being operated by using the internet, intranet and other technologies To study future and long term benefits of tourism industries which have adopted fully internet technology and successfully operating their business online. To discuss about the obstacles in operating the e-business of tourism online. 3. Main Body 3.1 The concept of E-Business and its use in tourism sector: Online business is a universal phenomenon. E-business is a necessary element of the business strategies of any company. The concept of E business has fully settled down in developed countries and it is percolating in the developing countries also. Networks and relationships as critical factors in shaping the distribution of economic advantage are relevant to tourism, as it directly impacts on interactions between local and global forces (Giddens, 1990). E-Business is basically referred to as the application of information and communication technologies. “E-commerce is usually associated with buying and selling over the Internet, or conducting any transaction involving the transfer of ownership or rights to use goods or services through a computer-mediated network.”(Thomas L. Mesenbourg) This research was performed to gather the secondary data regarding E-commerce in tourism industry. Trek America is the tourist company, taken into consideration for the research. The secondary data will be gathered from the detail study of Trek America and their online business of tourism. It is studied here what types of information technologies are being used by this company and what benefits they have got out of the e-business. While describing the importance of information technology in tourism industry writer Yunus S. Saliu states, “The tourism industry has proved particularly suitable for the adoption of information technology because of its dependence upon the supply and exchange of information throughout the production and distribution chain. As an extremely information intensive industry, tourism is undergoing rapid and radical modern changes. A wide range of opportunities discover on daily basis through the use of information and communication technology. Now information technology is being used for a variety of functions in the tourism industry, ranging from an internal organization role to external communication between different parts of the industry. The continuous development of information technology has profound implications for the whole tourism industry.” (Yunus Salin 2008) 3.2 Trek America – E-Tourism: 3.2.1 Website: Trek America has designed a complete and very attractive website which gives detail information about the various destinations of the world. There are different links which give the tourists the information about various facilities such as the destinations, cost, duration, accommodation etc. 3.2.2 Online Brochure: The tourists can easily access to the company via phone or internet. He or she can be delivered the detail broacher by just calling on the number they have given. The facility of getting digital brochure is also available. Proper instructions have been given, to open and read the digital brochure. It means that the customers today can get the service in this relation by sitting at home and using the advanced technology. Here Trek America is just an example but like Trek America almost all tourist companies are using the advanced technologies for their business. 3.2.3 Virtual employment process: Online business has its own benefits. Here the tourism company offers n numbers of opportunities for employment. For online operation generally the skilled human force is required. “Tourism has emerged as an instrument for employment generation, poverty alleviation and sustainable human development. During 2003-2004, direct employment in the tourism sector was estimated to be 21.54 million. Tourism also promotes national integration and international understanding and gives support to local handicrafts and cultural activities.” (National Portal Content Management Team, Reviewed on: 21-04-2010.) “In a nutshell, it is true that tourism creates employment and is generally beneficial to the economy.” (Kartik Chandra Roy, Clement Allan Tisdell 1998) In Trek America many such opportunities are available which can be caught just by visiting the website. The company has adopted the method of online recruitment. On the website the link of career is there. By clicking the link the person can get the information of the different positions available in the company. Thus the primary information about recruitment and jobs in the company can be obtained online. The Internet has provided a new economic environment in which to conduct business. E-commerce is a growing sector and many tourism businesses are involved in developing their internet services including traditional travel agents, tour operators, national tourist offices, airlines, hotels and other accommodation providers and car hire firms. (Tourism E-Business, the Scottish Parliament Information Center) 3.2.4 Booking Trek online: The operation of Trek America is totally online. You can book your trek within few minutes, no matter in which country you belong to. The sales offices of Trek America are situated all over the world. In short the tourist business has crossed the domestic lines and it is run on international level. Booking the trip with Trek America is possible by using their fully automated secure SSL certified online booking engine. The payment process is also online. The payments are processed by Barclays Bank. Though the payment process is online, it is very safe and secure. Once the trip is booked the customer has to pay an online deposit of GBP125 / US$175 / Euro150. 3.2.5 Selecting trek destination and further information: The advance search allows the customers to search different treks such as destination, departure, date, trek duration, departure city and preferred accommodation. For selecting the trek the customer can use the Quick search panel on each page. One can access the Advance Search Page by clicking on the “Tour Search Button” on the navigation bar or the given link For further communication the email system is used. The tourist companies like Trek America keep themselves in touch with their customers via emails or cell phones. Mostly emails are preferred because it is the cheapest and fastest way of communicating the customers. According to the policy of Trek America, the customer gets confirmation, invoice as well as trek tips within 24 hours after receiving the booking. After depositing the final payment the customer receives vouchers. 3.2.6 E-Tourism and communication: The scope of tourism industry has widened and it is not just the matter of arranging tours. But the tourism industry has to arrange many things. The final aim is customer satisfaction. All the programs and tasks performed are customer oriented. Constant communication with the customer is really very important for achieving long term business goals. Customers’ feedback is very important for any business to prosper. It is very necessary to know what the customers are thinking about the services. The feedback process is very crucial to the business for designing various strategies. All the businesses including tourism business is striving hard for gathering customers’ feedback and for that also the online procedure is used. There is a community called Trek America community where the customer can find out more about the previous trekkers of Trek America. They can share their experiences with the other people about Trek America experience. The previous customers are also motivated to upload their photographs of the trekking expedition. The customers can see the trek videos and pictures. They can also read the comments from all over the world about the company. They can write the blogs. Thus the communication process becomes world wide due to internet. One can find these companies on face book and twitter. Trek America also has created their own Trek America You Tube channel. The people can upload the videos of their trek with Trek America. 3.3 Online Visa Waiver Program: The tourists from outside US are allowed to travel to US under the Visa Waiver Program if the fulfill certain requirement and who has an electronic passport. It is mandatory for any person planning to travel to the USA under Visa Waiver Program to complete free online pre registration and get approval via US embassy websites Electronic System for Travel Authorization (ESTA) The Electronic System for Travel Authorization (ESTA) is a new fully automated, electronic system for screening passengers before they begin travel to the United States under the Visa Waiver Program. The total information related to this matter is also available on the website of Trek America. 3.4 The Prospects of E Business in Tourism: Tourism was just an activity and not a choice of business when there were no means of communication available. It was a very small activity and was performed in a very limited manner. The sophistication in the field came with the advent of globalization and the invention of computer and internet. Due to the development in information and technology the tourism prospered. E- Business in tourism has many benefits which has made this sector one of the fastest growing business industry. Due to the countless benefits of E-tourism this business has boomed within a very short time span. The followings are some of the benefits of tourism: That it is the most cost effective way of communicating with target markets and disseminating information It is a quick and easy way for the customer to buy travel products It offers opportunities for improvements in customer service and retention through meeting and promoting individual preferences It reduces costs through increased efficiency in internal operations and purchasing processes It encourages greater co-operation amongst traditional competitors through the provision of hypertext links. Links are a cheap, quick way of raising the profile of a new site and getting round the difficulty of up-dating information in-house. The inclusion of links on tourism websites offers benefits to both the user and the service provider. The service provider can offer a greater range of information on related tourism products without having to enter into contracts with the service providers and the user has access to immediate information and online shopping opportunities. (Source: E-Business for Tourism: Practical Guidelines for Tourism Destinations and Business 3.5 E-Tourism platform Utilization of technology in tourism is not only limited just to websites or online booking system. It is more than that. It gives the complete set of tourism management, promotion, and fulfillment tools with the central database. E tourism platform is “a generic platform, which will be the core of envisaged model of tourism market, is currently being developed. The functionalities of the platform will facilitate the collection of national tourism data, as well as the management of the tourism offer, via collection of standardization mechanism.” (Development of the Electronic Tourism Platform) www.newmind.co.uk/site/technology 3.7 The possibilities of failure of E tourism The use of technology has become necessary part in tourism industry. Each and every transaction is done online and sometimes the customers are not willing to communicate online or sharing their personal information due to the security matter. Sometimes it is possible that the information may be misused. At that time they prefer to choose the local tourist company. In that case it is not possible for the abroad tourist company to establish their business in foreign countries due to the Geographical distance; it is difficult to establish trust between the company and its customers. Second chance of failure is because of the customers’ preference for face to face communication and transactions. While spreading the business online it is hardly possible to communicate face to face. The customer even doesn’t know who the persons whom he or she is interacting. “The preference of many customers to conduct complicated transactions in a Face-to-face environment (e.g. high street travel agents)” Sometimes it happened especially in third world countries that the hotel owners and other people who are engaged in the chain of tourism are reluctant to give information about their hotels on websites. They are also not willing to disclose their rates online. While describing the same experience Najla Moussa in the article “Delving into the Online Tourism Industry,” states, “As the first and only Internet e-tourism company in the country, intoegypt.com was received by skepticism by its critics, both in and outside the industry, who believed that the only way to sell and market destinations was face-to-face.” (Moussa 2006) “Many people in the industry scoffed at the idea of online travel. For them, it was unfathomable that Egyptians would ever book or even inquire about destinations and travel packages online. From the start, we were dealing with a cultural block,” (Moussa 2006) explains Howeidy, CEO of intoegypt.com. Intoegypt.com is the first internet based tourist company in Egypt. Further he says, ““This was very hard to get around because competing hotels and resorts do not want to publish their prices,” The third possibility of failure is that the online businesses can catch specific and focused customers, those customers who are computer literate and who have access of internet. It is of course not possible for every customer to have online access and the company in that case has to sacrifice those customers. Sometimes it is also quite possible that the customer can propagate negatively about your company and your services. We can find some negative posting sent by some customers who are not satisfied with the service given by the company. 4. Conclusion: Travel and tourism is one of the most lucrative careers. Due to the progress in software technology like other business it has become global business. Being a global business tourism industry has to rely on internet as most of the functions are performed online. The companies have developed different software technology to run the tourism business online. This business can also be called as E-Tourism. The functions like developing website of the company, getting digital brochures, finding information, reservation or booking, secure payment transactions, hotel booking, availability of transport, sight seeing, tourist guides, travel network connectivity, multi currency support, etc. are done by using internet. Even the tourists outside USA can fulfill many official formalities by using internet service. Tourism software can be developed for the successful E-Tourism. The E-Tourism is the business which can be started by any small scale or medium scale industry also because it is very cost effective. Plus one can get the customers from all over the world. The future of this industry is bright but at the same time it should not be forgotten that there are some bad sides of it. The negative points, if not tackled properly can hamper the business and the business can get failed. Among the major risk in running all the functions of the tourism business online is risky, especially the money processing or keeping confidentiality about the customers. But each technology has two sides. Whatever the best we can offer to the customer by using modern technology is the important concern. So tourism industry has no option but to adopt the internet technology for the prosperity but at the same time it would be the suggestion from the researcher’s side that along with the online business the company needs to interact with the customers face to face also. It is very important to build the trust among some customer who prefers to do the transactions face to face and they are not willing to go for the technology. In domestic market it is comparatively easier but on international level the company can establish offices in different regions for creating rapport with their customers. Of course this might be financially very expensive but it is essential for establishing long term business with the demographic population. Bibliography 1. Milner Makuni 2007) Milner Makuni, Exploring the value of Internet in Tourism 27th September 2007, 2. http://www.infobridge.org/asp/documents/3781.pdf 3. UNWTO 2009 4. WTO 2003 5. Page 10, “E Commerce and Information Technology in Hospitality and Tourism,” by Zongqing Zhou, Cengage Learning Publication 2004 6. Giddens, 1990, The Consequences of Modernity. Cambridge: Polity Press. 7. Thomas L. Mesenbourg, Measuring Electronic Business: Definitions, Underlying Concepts, and Measurement Plans. 8. Yunus S. Saliu, 2008, Tourisphere- The role of information technology in tourism industry Wednesday, July 02, 9. National Portal Content Management Team, Reviewed on: 21-04-2010. 10. Kartik Chandra Roy Clement Allan Tisdell, 1998, “Tourism in India and India’s Economic Development Pg.114, Nova Publications 11. Tourism E-Business, the Scottish Parliament Information Center 12. Business for Tourism: Practical Guidelines for Tourism Destinations and Business) 13. www.newmind.co.uk/site/technology 14. Development of the Electronic Tourism Platform, website: 15. http://www.unctadxi.org/templates/Page____2126.aspx 16. Delving into the Online Tourism Industry, by Najla Moussa, first published in July 7, 2006 “Intoegypt.com is turning former doubters into believers,” Daily News Egypt 17. The website: www.trekamerica.com Read More