Sustainable Tourism Management in the UK - Assignment Example

Tourism: Options and Recommendations Introduction The UK tourism industry has achieved a significant growth over the last two decades, and today the tourism sector notably contributes to the country’s GDP. Evidently the fast growth of the country’s tourism industry greatly contributed to the development of other related industries like transport sector and hotel chains. The outbound tourism activities really benefited the UK travel industry to post terrific growth rates over the years (Leonard & Jenkins, 2007, p.117). However, there has been a decline in the outbound tourism trend in the country for the last few years, and UK also experienced a decrease in the number of overseas holiday homes owned by its citizens. This change in tourism trend could be attributed to uncertain economic conditions, stagnant salaries, rising inflation, and growing threat of terror attacks. Therefore many of the UK citizens think that it is better to visit domestic tourist destinations that are in close proximity to them so as to maintain a good balance between their income and expenses. Evidently, such an adverse trend change in the tourism sector would negatively affect the travel business. This report will examine how the travel agency could respond to this change and suggest specific strategies to boost sales in the context of the change. How travel and tourism industry could respond to change? The declining trend of outbound tourism in UK poses great threats to travel and tourism businesses that increasingly rely on people visiting overseas countries (Travel Mole, 2014). The recent global financial crisis together with rising daily living expenses significantly contributed to this trend because people strongly believed that outbound tourism would cause them to incur huge costs. In addition, there has been a trend of decrease in the ownership of overseas holiday homes in UK over the last few years. The English people think that visiting domestic tourist destinations is a better way to cut down huge expenses associated with outbound tourism and save for the future. The growing threat of terror attacks across the world also discourages UK citizens to enjoy overseas holidays or to own overseas holiday homes (Page, 2011, p.75). A SWOT analysis is a better tool to analyse the internal and external environments of the travel and tourism sectors. While analysing the internal strengths of the UK travel industry, it seems that the country has a well developed infrastructure that support travel and tourism businesses. High cost of operations is a major weakness of these sectors as this issue negatively affects people’s overseas holiday interests. However, growing scope of tourism appears to be potential opportunity for the travel industry as travelling is a key part of any form of tourism. Increasing fuel prices may pose serious challenges to travel and tourism businesses as this problem adversely affects travelling charges. From a PESTLE analysis, it is identified that UK has a stable political spectrum. In addition, the country is fast recovering from the terrible impacts of the recent global recession. Evidently the UK’s culture greatly supports travel and tourism activities, and they are backed up by the UK government too through policy initiatives and cross border liberalisations. The country has a well advanced technological landscape to strengthen its travel sector activities. The UK government follows and effectively enforces strict environmental policies to fight issues like global warming and climate change (Swarbrooke, 1999, p.37). The SWOT and PESTLE analyses make it clear that the UK travel and tourism businesses have great growth potential in spite of the decline in outbound tourism trend. The UK travel agencies or travel industry can enhance its growth by capitalising on the emerging growth opportunities in the tourism sector, and focusing particularly on product innovation and marketing improvements. Strategy recommendations In order to respond to the changes it is facing, the travel agency must develop a range of potential strategies that are capable of improving its revenues and net profitability. As noted already, financial unaffordability is the major reason leading to decline outbound tourism revenues in UK, and hence strategies developed by the travel agency must specifically address the economic concerns of tourists. It is recommendable for the travel agency to offer affordable charges to clients (tourists) so as to encourage them to travel abroad and thereby to revive the outbound tourism trend in the country. For this, the travel agency can adopt a low price competition strategy although this practice may not assist the industry to achieve a fast growth in profitability. In addition, it is advisable for the organisation to design special travel packages that would benefit tourists to take advantages of economies of scale. The business may increase its focus on related services like hotels, car rentals, and other leisure services in order to provide tourists with comprehensive service packages. Similarly, it is advisable for the travel agency to rely more on social networks to spread its brand awareness and attract more passengers. The travel agency may also use high profile celebrities to market its brand and achieve high level brand recognition. A targeted marketing strategy is better for the travel sector to influence people from different economic classes and obtain wide market coverage. To be in line with today’s marketing trend, the travel agency may sponsor sporting events or TV reality shows, and make its brand well recognisable among the public. Justification of selected strategies From a SWOT perspective, the low pricing strategy can benefit the travel agency to a great extent. It is evident that rising fuel costs and growing daily life expenses significantly contribute to decline in outbound tourism, and the ownership of overseas holiday homes by UK citizens. In this circumstance, a low pricing strategy can greatly assist the travel agency to foster the outbound tourism culture and improve its overall sales. Since the travel agency has better access to numerous potential sources of finance, it would not be a challenging task for the organisation to manage its operating costs while practicing the low cost strategy. The low pricing strategy would provide the travel agency with an opportunity to maintain a potential pool of loyal customers and grow its business in the long term. This strategy will better fit the UK’s current economic, social, and technological environments too. Internet based marketing can extremely benefit the travel agency to increase its overall sales and to keep up with the pace of the modern world (Williams, 2012, p.11). Today most of the UK citizens have full time access to internet, and they are active in social networking websites like Facebook and Twitter. Therefore effective use of social networking websites can assist the travel agency to reach maximum audience easily and cheaply. Another notable advantage of this marketing change is that it would greatly benefit the business to keep its clients informed of new product innovations and other offers timely and confront market competitors successfully (Sambhanthan & Good, n.d. ) A major positive impact of adopting advanced online marketing techniques is that this policy can really aid the travel agency to facilitate effective customer interactions and gather customer feedbacks and suggestions regarding key business plans and strategic decisions. By maintaining its own corporate website, the organisation can offer online booking facilities to its clients, and widen its market coverage. Consequences of poor response to change Evidently the travel agency cannot survive the current changes in the UK tourism trends unless it takes some immediate measures to address the change. Today people are increasingly conscious about their monthly budget and the consequences of expenses overrunning revenues. Nowadays people in UK are less likely to engage in leisure activities like overseas holiday trips that that are not considered necessary for living a normal life. If the travel agency is unwilling to cut down its ticket charges or other prices, it cannot effectively influence the changing customer perceptions, and therefore the outbound tourism trend would continue to decline the United Kingdom. It is evident that outbound tourism is a major tourism sector making up a significant percent of the total revenues earned by the travel agency. Therefore a continued decline in the outbound tourism sales would terribly affect the revenue growth as well as the operational efficiency of the travel business. In short, the travel agency would face a business collapse in the near future unless it changes its pricing structure immediately in favour of the changing customer perceptions. Similarly, the way firms market their products/services to the customers has undergone tremendous changes over the last several years. In contrast to traditional marketing techniques like television Ads or printed notices, today corporations use innovative marketing channel like social media and internet to promote their products and services. At this juncture, the travel agency cannot survive the stiff competition in the current market environment if it still relies on traditional marketing techniques. In the absence of online marketing channels, it would be really a difficult task for the travel business to offer a greater shopping experience to its clients. If the travel agency is reluctant to follow this recommendation, the business would lose its market share to competitors who perform better in terms of using online marketing channels. Undoubtedly modern people expect greater convenience, price affordability, and time efficiency while considering shopping, and all these can be provided through internet based marketing. In total, a failure to follow this recommendation can have serious negative impacts on the travel agency’s sales and profitability. Conclusion From the above discussion, it is clear that the decline in the outbound tourism trend in UK and UK citizens’ reluctance to own overseas holiday homes pose potential threats to the country’s travel sector. The industry’s survival is greatly dependent on cross border tourism activities. This change in tourism trend could be attributed to growing life expenses and increasing fuel costs. In order to effectively respond to this change and to maintain sales and net profitability, the travel agency must adapt to a low pricing strategy which would make cross border travel affordable to tourists. This pricing strategy can also benefit the travel business to boost the outbound tourism trend in UK by maintaining a pool of loyal customers. Effective use of online marketing channels like social websites is recommendable for the travel agency to promote its products and services at minimum costs. Unwillingness from the part of the travel agency to follow these recommendations would cause the organisation to lose its brand awareness gradually. Evaluation This assignment greatly assisted me to develop group work skills. In addition, this piece of work was beneficial for me to comprehend how to address a changing market situation by amending operational strategies. Finally, it also aided me to identify the best suitable strategies in this regard by considering SWOT and PESTLE tools. References Leonard, L. J & Jenkins, C. L. 2007. Introduction to Tourism. New Delhi: Routledge. Page, S. 2011. Tourism Management: An Introduction. US: Routledge. Swarbrooke, J. 1999. Sustainable Tourism Management. Oxon, UK: CABI. Sambhanthan, A & Good, A. (n.d.). Strategic Advantage in Web Tourism Promotion: An e-Commerce Strategy for Developing Countries. [online] available at: http://arxiv.org/ftp/arxiv/papers/1302/1302.5195.pdf [accessed 26 May 2014]. Travel Mole. 2014. “UK travel and tourism industry in 2009 and outlook for 2010”. [online] available at:http://www.travelmole.com/news_feature.php?id=1142130 [accessed 26 May 2014]. Williams, A. 2012. Understanding the Hospitality Consumer. UK: Routledge. Read More