The Challenges And Opportunities of Tourism Development - Essay Example

? The challenges and opportunities of tourism development BY YOU YOUR SCHOOL INFO HERE HERE The challenges and opportunities of tourism development Introduction Tourism development is the process of broadening the ownership function of tourism to include multiple stakeholder groups. Development involves taking account of current resources, either environmental, social or economic, and then allocating these resources to address the needs of domestic tourism host communities and visitors. Tourism development seeks to improve operations within the tourism industry which translates into multiple benefits for the host community in terms of improving labour force skills development, job creation and regional economic wealth (Western Cape Govt. 2012). Depending on the host country characteristics that appeal to diverse travellers, development seeks to respect the socio-cultural identity of host communities which contributes to cross-cultural knowledge and tolerance that improves relationships during the tourism experience. Tourism development strategies allow government, local community citizens, and other important tourism industry stakeholders to work cooperatively to conserve regional histories, improve biodiversity within a tourism destination, or create cooperative marketing strategies to establish a regional tourism brand which maintains motivational appeal. It is the process of building tangible capacity for tourism, allowing local leadership in the industry to assist in the progression of sustainable tourism, thereby creating competence in the tourism function. Thus, it should be recognised that tourism development involves construction of an appropriate tourism infrastructure, improving quality and efficacy of tourism systems and human capital, and maturity of environmental assets that provide better aesthetic appeal. Having identified the concept of tourism development, this research study examines the challenges and opportunities associated with tourism development. The research examined several case studies impacting tourism in Iran, the island of Tuvalu, India, China and Brazil, five travel destinations with widely-varying socio-economic conditions and unique travel appeal. The research examines the aforementioned case studies as it relates to tourism development in areas of spiritual travel, community tourism, and the role of the marketing function to improve regionalised tourism attractiveness and economic sustainability. Opportunities and challenges in tourism development In order to create a quality and effective tourism model, stakeholders involved in the tourism development process must consider long-term sustainability as compared to the Destination Life Cycle Model proposed by Butler (1980), a model maintaining six stages that illustrate growth and eventual decline as related to a specific tourism destination or travel concept. Figure 1: Butler’s (1980) Destination Life Cycle Model Source: Butler (1980) As illustrated by Figure 1, stakeholders involved in tourism development must consider that without maintenance to existing tourism models or without effective marketing prowess, a tourism destination will eventually lose its appeal to multiple traveller demographics. In order to create efficacy within a specific tourism model, planners must consider existing market trends and make projections about future resource procurement and strategy development to extend the life cycle of the tourist destination. Globally, market trends indicate that experienced travellers, as one relevant example, are looking for new, off-the-beaten-path vacation destinations that is leading to considerable growth in ethnic and rural tourism (GIPC 2008). The Destination Life Cycle serves as an appropriate template to measure sustainability of a development strategy, taking into consideration existing market conditions and influences, to make stakeholder-relevant improvements to service quality, environmental biodiversity, or even tangible tourism infrastructure development. There are multiple opportunities associated with tourism development that can assist in extending the life cycle of the tourism concept that can translate into multiple stakeholder benefits, especially with the local community involved with provision of service. For instance, India has historically witnessed considerable growth in tourism revenues stemming from establishment of a more diversified tourism concept supported by government. India is currently in the consolidation stage, in which tourist services are being provided by multiple internationally-based brands however utilising local talent for service provision. Deteriorating facilities (e.g. hotels and resorts) are being replaced by more efficient and modernised facilities prompted by governmental incentives that support foreign direct investment by many Western tourism brands. In the consolidation stage, infrastructure has been improved, tourism facilities have expanded contiguously, and price competition between major tourism brands becomes more intensive (Agarwal 1992). One area which has provided new opportunities to gain ground with new revenue-building markets in India is in spiritual travel, a tourism diversification strategy to extend the growth period of this travel destination. According to Kalyanaram and Gurumurthy (2008) many target market consumers are risk averse. Consumers will often compare first movers in a market against late movers, generally maintaining loyalty for the pioneering first mover and making unfavourable evaluations for late market movers. India understood the necessity to diversify tourism opportunities to prevent its main travel regions from reaching market maturity that ultimately leads to revenue declines and less market demand. Analysis of the external market by Indian tourism planners indicated statistics illustrating that nearly 240 million international tourists seek religiously-motivated travel opportunities (Timothy and Olsen 2006). There is a large market of tourists that are looking for transcendental self-exploration, a form of post-materialism, making India an ideal destination for redemptive travel due to its rich history and experience with spiritualism. Indian tourist developers understood that strong market growth in spiritual travel represented opportunities to improve the destination appeal of India. Thus, spiritually-motivated marketing campaigns were developed in partnership with such destinations as the Vaishnodevi Temple, the Meenakshi Temple, and the Guruvayoor Temple, three destinations offering spiritual enlightenment and spiritual exploration under the Hindu canon. Figure 2: Advertising for India Spiritual Travel Source: Goswami, Joshi and Agrawal (2010). The benefit of utilising spiritually-centric advertising was coupled with local community stakeholders relevant for providing supplementary services associated with the religious travel itinerary. Through the construction of psychographic segmentation, a conception in marketing which aligns brand with lifestyles and attitudes of important tourist markets (Boone and Kurtz 2007), tourism developers were able to align creative marketing and engage local service providers to enhance the spiritual travel experience. All of these efforts provide opportunities for local communities to gain experiential knowledge on foreign cultures, improve relationships with spiritually-based travellers, and extend the life cycle of Indian travel by diversifying the travel infrastructure to satisfy new markets. All of this effort to build sustainability into the Indian travel model illustrates the importance of conducting environmental analyses to identify market trends and create adaptive strategies to avoid eventual obsolescence of existing travel models in India. Though India was successful in building better market appeal for the spiritual traveller, there are challenges to building sustainability into the new, diversified travel models. One of these problems is the lack of available, local human capital necessary to sustain excellence in the service concept. In India, there are limited talent experts in business and human resources, especially prevalent in rural regions, that create barriers to building efficiency and competency in the tourism service model (D’Essence 2004). Many organisations providing supplementary services, such as hotels and resorts, are consolidated in larger, urban regions where the local labour pool is better educated in service philosophy. For travellers seeking ethnic or rural travel as part of an exploratory travel philosophy, risks to improper service provision include unskilled local labour or lack of facility infrastructure. Rural regions in India maintain lack of information centres and food facilities (D’Essence 2004) and there is minimal cultural competency. Research evidence did not uncover how India was able to conquer these rural deficiencies or the specific plans provided by tourism development stakeholders to build rural capacity. However, the case study in India does tend to illustrate that tourism development is a multi-faceted process of identifying market trends, creating adaptability within the travel destination, and seeking opportunities to diversify travel capacity which are necessary conceptions to build sustainability into various travel models for long-term growth potential. Another significant challenge in tourism development involves economic conditions, both regionalised and international, that contribute to failures in providing diversified travel opportunities for multiple market demographics. Nowhere is this more observable than in Brazil and the island nation of Tuvalu, where regional economic policy has created considerable barriers to establishing an effective travel infrastructure and inability to prompt business development in areas of travel service capacity. Between 2002 and 2003, Brazilian officials determined that the most effective method of stabilising interest and currency exchange rates was to establish a crawling peg fiscal policy, in which the exchange rate becomes fixed against a basket of international currencies (Startz 2009). This new fiscal policy led to massive inflation that increased utility and telephone costs by 17 percent and 17.7 percent, respectively (Business News Americas 2004). For those involved in the tourism industry, significantly rapid inflation rates impacted the operational budget of hotels, resorts and other service industries, impacting pricing structures and removing some price advantages from competing domestic and internationally-based tourist facilities. The situation in Brazil illustrates the importance of tourism developers to consider the impact of fiscal policy in order to build local capacity for sustainable tourism and maintain destination market appeal. The sophistication of fiscal stabilisation measures in Brazil did not take into consideration local impact in the travel industry. This is a significant oversight considering that tourism represents 10 percent of total national GDP in Brazil (GLS 2012). Even though Brazil continues to experience growth in tourism attractiveness for multiple market demographics, political ideologies and unsustainable fiscal objectives did not effectively consider long-term outcomes that impact competitiveness in this industry, something necessary to achieve gains in improving market appeal and elongating the service life cycle. Poor fiscal policy leading to significant inflation in Brazil prompted many business closures and created an environment where banking loans and credit issuance was hindered, thus reducing capital availability for businesses in the tourism industry necessary to enhance regional service capacity and competency. Fiscal policy and its inter-dependencies to multiple stakeholders in the tourism industry are necessary considerations, especially when concentrated reliance on revenues from tourism is necessary to sustain a largely service-based economy. In the island nation of Tuvalu, the country recently adopted the Australian Dollar as its main form of currency, changing the dynamics of value for many international tourists that had previously experienced considerably positive exchange rates. Unexpectedly, the Australian Dollar appreciated due to impacts of the international economic recession from 2007 to 2009. This led to a massive decline in tourism revenues in 2011 (Euromonitor International 2012). Government in Tuvalu, however, recently attempted to offset these losses by establishing a new marketing positioning campaign, involving international distribution of a video entitled “King Tide – The Sinking of Tuvalu” which led to dismal market response as it failed to appeal to the country’s desired target markets (Euromonitor International 2012). Again, the economic realities of establishing a relevant and sustainable tourism development model can either serve or conflict long-term growth in infrastructure or supplementary tourist support services. As two developing nations, neither the government of Brazil nor Tuvalu considered the impact of economic policy on the tourism industry. Furthermore, research did not uncover cooperative strategies in either nation seeking to improve its GDP through tourism-based revenues or adjust fiscal policy to make it more conducive to growth and development in tourism. This strongly reflects the challenge of tourism development in relation to the inter-dependencies between government and tourism support stakeholders in multiple tourist-related industries. Without proper alignment between fiscal policy and tourism planning, long-term economic consequences forbid development of a sustainable tourism model. Having identified a variety of challenges in tourism development, the socio-cultural dimensions associated with creating a sustainable tourism model must be addressed as they represent significant opportunities to improve regional attractiveness and investment opportunity. A recent study involving 262 random, local respondents in Iran indicated a non-homogenous cultural view of tourism development in the country (Abdollahzadeh and Sharifzadeh 2012). The study identified that disparate, local cultural connotations were conflicting the process of effective tourism development at the socio-cultural level. Though most in the study believed the most significant benefit of tourism development was achievement of economic growth borne of tourism revenues, disproportional diversity in cultural attitudes conflicted the process of establishing a unified, regional tourism model. Why is the cultural disparity in Iran important in understanding opportunities in tourism development? It has been established that most evaluations of tourism development are quantitative in nature, involving economic analyses and environmental analyses, however there are sizeable gains that can be achieved by establishing a homogenous service culture dedicated to supporting tourism objectives. In Iran, tourism planners did not make appropriate consultations with important service provider stakeholders to create a regional tourism strategy with a promotable, unified cultural connotation. The Iranian government, as the relevant planning committee, did not establish a collectivist tourism methodology, not taking advantage of the many gains achievable through entrepreneurship and where little attention was paid to balancing the needs of the local stakeholder communities; something necessary to improve or sustain service products. Disparity between varying cultural beliefs and attitudes in Iran and other tourist destinations forbids utilising marketing effectively to present an appealing promotional campaign that focuses on cultural pride. According to Kotler, Bowen and Makens (2003), the social processes of marketing are highly valuable in this industry as they establish the specific cultural values that make a tourism destination appealing. This has significant consequences for tourist destinations that rely on ethnic travellers or rural travellers seeking connection with local host cultures when there is no promotable template by which to express socio-cultural advantages to travellers interested in engagement with local service providers. Nowhere is oversight in understanding and incorporating local host community culture into the tourism development model more apparent than in nations that rely on significant revenues from Chinese tourists. One cultural characteristic shared by many potential markets in the country is a hedonistic set of values, loosely defined as the desire to maximise one’s own utility and seek self-gratifying pleasures (Veenhoven 2003; Overskeid 2002). Hedonism is deeply engrained in this collectivist culture and influences tourist-related purchase decision-making and the level to which local Chinese service providers engage with foreign cultures. Wen (2007) describes the hedonistic values of male Chinese consumers to consist of nice skin, elegant dress, and graceful demeanour. Concurrently, many Chinese consumers have a very strong ethnocentric view of national and cultural superiority as measured against other nations, impacting purchasing decision-making in the tourism industry. Why, though, is this cultural characteristic of Chinese markets and tourism service providers so vital in understanding the challenges and opportunities of tourism development? Tourism development is much more than the quantitatively-justified strategies put into place to fuel better stakeholder relationships, it is about establishing a universal set of ethics and morals deemed acceptable by host communities, tourists and travel partners. Hedonistic and vanity-related values coupled with ethnocentrism pose challenges to establishing a service model in which providers are able to negate their own cultural connotations to provide culturally-sensitive tourism services to non-collectivist consumers that have relative views on ethics and morality. Tourism development is about preserving and embracing the cultural heritage of host communities, however it is also about serving the interests of the most important stakeholder group, the traveller, who provides economic growth in the tourism region. “The right person in the right service job is critical to ensuring success in the travel industry” (Khan 2008, p.96). It is absolutely vital that during tourism development planning, cultural characteristics be considered and aligned with market preferences even if they substantially conflict with the host community providing tourism services and products. In order for there to be positive gains achieved in tourism development, cultural issues cannot be negated from the development model as the consumer-perceived service competency and service efficiency relies on alignment between culture and the physical service and facilities model utilised to ensure travellers report positive service experiences. There are difficulties in establishing a homogenous, promotable cultural dimension that contributes to successful tourism modelling when disparity of cultural values and attitudes are distinct and significant. Even though tourism development planners may be active in considering the value of building a more efficient, tangible service infrastructure and making aesthetic environmental improvements to sustain visual appeal of the tourist destination, without adequate alignment of diverse social attitudes of service providers and travellers, there is little opportunity for building a sustainable developmental model in this industry. Analysis of findings The research findings have provided knowledge on the inter-dependencies between economics, cultural sensitivity, service providers in the tourism model, and governmental consultation with key stakeholders to shed light on the challenges and opportunities associated with tourism development planning and implementation. The involvement required in the private business sector, local community citizens, and government cannot be overstated as critical imperatives to ensure a viable and relevant tourism model is constructed. As identified by the research, several of these important concepts were omitted from the development planning process in Iran, Brazil, and Tuvalu, which ultimately led to revenue declines and ineffective market appeal that serve to, in the long-term, shorten the life cycle of various travel destinations. Tourism development is more than simply recognition of the tangible facilities management necessary to fulfil diverse traveller needs, successful development involves focusing on the intangibles of tourism which are often supplemented with considerable emphasis on advertising and promotion. “For the tourism related business entities to operate successfully and rationally, their business policy has to be founded on application of a marketing conception” (Cejvanovic, Duric and Vujic 2009, p.5). It was identified in the case study analyses involving hedonistic values in Chinese travellers and service providers as well as the problems posed by cultural disparity in Iran. Research identified several best practice strategies in using marketing and promotion to build a differentiated and positive methodology to appeal to diverse consumer groups, such as the successful spiritual travel marketing utilised in India that served to gain market attention and interest for the redemptive traveller (illustrated in Figure 2). Qualitative analyses of the research materials utilised in this process would seem to point toward an absolute necessary to align marketing and promotion with tourism development in order to make important socio-cultural gains that enhance destination demand. Without emphasis on creating marketing-based connections with important target markets that link lifestyle and culture, tourist destinations are missing a significant source of competitive advantage and it becomes more and more difficult to establish a differentiated, global brand, which is critical in regions where tourism competition is intensive. Literature that describes best practice models of tourism development tend to emphasise the importance of preserving and sustaining local community culture and heritage. Dabour (2003) disagrees with marketing as the most vital conception leading to a sustainable tourism development model, offering instead that too many countries tend to rely on promoting cultural heritage as a source of competitive advantage in this industry. It was identified previously that some cultures, such as those in China, maintain very strong ethnocentric values that translate into how service is provided and engagement with tourists is conducted. Tourism development planning must be flexible and include diversity in cultural recognition in order to gain favourable market attention. Ethnocentric values associated with local host communities cannot effectively inspire market growth and demand for a specific tourism destination if they conflict with foreign traveller cultural needs. Research findings have indicated that socio-cultural factors are highly critical if there is to be sustainability in development planning and implementation. Conclusion The five case studies involving Brazil, China, Iran, Tuvalu and India clearly illustrate the complexities and opportunities for ensuring efficacy in a tourism development model. The influence of economic policy and oversight in providing government-sponsored opportunities for economic growth for multiple service providers is significant when attempting to build long-term sustainability. Coupled with the relevancy of cultural sensitivity, the marketing function to gain international market attention, and ensuring aesthetic environmental improvements in the host community, it is apparent that tourism development is a multi-faceted process requiring numerous competencies in strategic planning and stakeholder relationship development. Failure to recognise more than simply the tangible infrastructure in tourism development limits the competitive advantages of a host destination and can actually shorten the life cycle of the region by negating diversity, cultural sensitivity, and flexibility necessary to gain positive market assessment of the tourism experience. Successful tourism development blends quantitative analyses with qualitative knowledge of market preferences and cultural relevancy and then utilising consultation with important stakeholders along the entire tourism value chain in order to achieve long-term results and sustainability for the existing tourism service model. It is only through engagement with critical stakeholders ranging from government to the local tourism support agents in the host community that a successful tourism development model can be constructed and implemented. 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