Impact of Internet Usage On the Tourism Industry - Essay Example

IMPACTS OF INTERNET USAGE ON THE TOURISM INDUSTRY: A REVIEW OF THE USE OF THE INTERNET IN HOLIDAY PLANNING AND BOOKING Contents Introduction 3 Core Motivations for the Utilisation of Internet in Holiday Planning & Booking 3 Convenience 3 Completeness of Information (Panoramic View) 4 Comparability 5 Accuracy & Discounts 5 Individualism 6 Internet and Competition 6 Tourism Industry’s Reformation 8 Conclusion 8 Bibliography 10 Introduction In the year 2010, as many as 19% of tourists who travelled into some developed countries completed their booking online whilst another 70% of these tourists stated that they had sought information online (Tourism Research Australia, 2011). As of 2015, the number of people who had used the Internet to book tourism related activities increased to 40% (Rezdy, 2015). This increase in the usage of the Internet to book flights, accommodation and seek tourism information has increased systematically since the advent of the Internet The purpose of this paper is to critically analyse and review the role of the Internet in the tourism industry. It will commence by examining the main reasons why people utilise the Internet in the holiday planning and booking. The paper will also examine and review the role of the Internet as a tool for competitive advantage amongst companies and entities in the tourism industry. Finally, the paper will critique the role of the Internet in the overall tourism industry and how it is inducing a reformation in the industry. Core Motivations for the Utilisation of Internet in Holiday Planning & Booking In order to identify the importance of Internet usage in planning and booking holidays and tourism, there is the need to identify the push factors that is causing the industry to rely so heavily on the Internet. This will give an insight into the main reasons why Internet usage is so significant. This is because the push factors that induce consumers, who keep the industry going is an important explanation of this phenomenon. Convenience Planning a trip is difficult and complicated because there are many things a traveller needs to do and this ranges from planning transportation to the destination, planning accommodation in an unknown place and planning a range of activities within the destination. All this comes with a lot of effort. However, the Internet comes with convenience that makes it much easier to achieve the goals and targets of planning and booking accommodation and transportation for trips. Convenience comes with three main variables: time convenience, user control and service compatibility (Kleijnen, et al., 2007). This implies that a person planning a tour saves a lot of time and that individual has a lot of options to plan the trip when the Internet is used. Also, the Internet is increasing in service compatibility and most tourist activities are online these days. This cuts down on the cost of planning a trip and enhances the experience of the tour (Oppewal, et al., 2013). Convenience also includes a high degree of flexibility that allows people to book in advance and adjust their bookings in an easier manner (Coenders, et al., 2015). Convenience also comes with an element of speed and ease of doing things relating to a given tour (Rodgers, 2014). Completeness of Information (Panoramic View) Another element and aspect of information gathered online includes the fact that information gathered online are detailed and more diverse (Nalin, 2014). As such, a visitor or prospective tourist can get a wide array of information that can give him an informed view of the destination and hence make the journey more interesting and more worthwhile (OECD, 2012). Through the Internet, a prospective visitor can get all information she needs objectively and subjectively (Nalin, 2014). Therefore, if a tourist has unique needs and expectations, he could potentially gather as much information as possible and come up with a good plan that will suit his or her needs .This is opposed to traditional approaches of gathering information in ways and means through magazines, television shows and calling a given tourism centre or many different accommodation entities to gather information. Everything is available online. Comparability One of the benefits that comes with the abundance of information via the Internet is the ability of making comparisons (Mariani, et al., 2014). This is because an average tourist can get a lot of information about accommodation in a given place by just a click of a mouse or the flip of a smartphone. This culminates in a lot of options to compare prices being offered by different facilities and also by different entities (Medlik, 2012). Therefore, an individual tourist will be able to get the opportunity to make the best choices through comparison. This is because she can identify what is best and what is not alright. From there, there could be a lot of choices that could inform or improve his or her tourism experience. Accuracy & Discounts There is a bigger tendency towards getting transactions right. This is because most online portals and payment systems are streamlined. And it is easy to pay money across different currency units without any major disparities, issues and confusion. This makes the Internet a desired option of carrying out activities because it is objective and there is no sign of cheating or any attempts to take advantage of anyone (Nalin, 2014). It can also be identified that the Internet is a means through which discounts can be easily discovered by tourist. Unlike the past where airlines seats were offered for extremely high prices, there are numerous discounts that can be easily offered to consumers at different times of the year through the Internet. This makes it easy for the airline companies and other tourism entities to sell seats into the foreseeable future and gain enough money to remain productive. Individualism The growth and expansion of the Internet is in sync with the current ideals and values of modern society which is more about individualism rather than collectivism. Unlike the past generations where tours could best be organised in groups or as family units, the Internet enhances the values of an individualistic society. This includes the opportunity to support solo or lone travellers as well as couples who are not in the traditional relationships. Thus in as much as these individuals have shaped the use of the Internet, the internet allows members of the society to express their uniqueness and their own independence by pursuing limited options and offers and carrying them out to the highest and optimal levels. Internet and Competition Aside the push factors that define the planning and booking industry of tourism, there are also some pull factors that define the way entities offer their services to consumers. These processes are such that they get consumers to also tilt towards the use of the Internet to connect with these tourism companies. After consumers who have now tilted towards a wholesale utilisation of the Internet to make bookings, there is the issue of tourism operating entities around the world. These entities are influenced by the need for survival and liquidity which culminates in the quest for the capture and control of market share. As a matter of fact, there is a general presentation of tourism destinations online and this comes with the presentation of collectivised information about a given place and its tourism activities over the Internet (Roque, et al., 2013). These procedures are known as co-opetition (cooperation and competition) and it involves the coming together to achieve competitive advantage and yet competiting to achieve their individual profitability targets (Edgell D. L., 2012)This implies that firms will have to build their own branches to benefit from e-marketing potentials of reaching consumers directly. Therefore, in order to tap from the vine of a destination advertising campaign, every firm in the tourism industry will need an online presence that will give as much information about its activities and processes as possible. This culminates in an ever-growing web of information about tourism entities and this keeps growing. The use of meta-search engine indicates that an individual can have access to millions of pages on a single click (Aiello, 2012). This implies that there are many options for the examination and review of information that guides a tourist in taking the right decisions in terms of meeting his own tourism needs. Therefore, the next thing that most tourism firms and entities do is to position themselves in a way and manner that allows them to become easily accessible to potential tourists. It is also identified that the integration and utilisation of the Internet for planning and travelling places some kind of obligation on entities and organisations in the tourism industry. Traditionally, tourism businesses carry out activities according to Kotler’s 4Ps, which includes dictating the Price, Place, Promotion and Product on offer. However, the shift towards the utilisation of the Internet has led to a situation where firms compete for consumers’ attention and resources. This has culminated in what is now known as the 4Cs which includes: 1. Consumers needs; 2. Cost to satisfy; 3. Convenience to purchase; 4. Communication (Meng & Chatwin, 2012) Most firms in the tourism industry spend a lot of time to examine consumers’ needs and expectations in order to position themselves in the right way and manner to achieve competitive advantage. This includes constant monitoring and responses to consumers rather than dictating the pace and prices on the markets. Secondly, a firm in the tourism industry in this age of the Internet will need to be sensitive to the cost it will incur to satisfy the needs of consumers and maintain profits. This is an internal quest, rather than an external situation that is to be borne by the buyer in the 4Ps. Thirdly, there is an obligation on firms to provide convenient means through which consumers can purchase goods from them. This is by allowing easier and more flexible means over the Internet and allowing them to make choices. Finally, constant communication in the tourism industry is essential to jointly provide consumers’ needs and expectation. Tourism Industry’s Reformation Due to the changes in the tourism industry, there are major planning and booking activities that reflects the position of the Internet. As a result of this, it is apparent that most firms in the tourism industries around the world have strategies that revolve around Internet purchases and Internet marketing (Buhalis, et al., 2014). Tourism searchers and plans are now community-based and every entity is to see itself as providing customer experience as part of a larger chain (Panda & Mishra, 2013). This implies that the industry is skewed towards one in which searchers are bound to be interrelated and the Internet is bound to be an important and vital tool for achieving any significant goals. Finally, booking is highly dependent on e-commerce portals and tools. These are gaining roots around the world. Therefore, purchases are being done online and plans are being finalised online around the world. Conclusion The research identifies that there is strong evidence that the Internet usage shapes the context within which people plan their holidays and make bookings. This is due to some push and pull factors on the part of consumers as well as some industry-wide factors that have evolved over the years. The main push factors for the use of the Internet in holiday planning and booking include convenience, completeness, comparability, accuracy and discounts and the reflection of contemporary values of individualism. There are other pull factors which mainly relates to the structuring of tourism entities that encourages the use of the Internet to plan and book tours. First of all, for competition purposes, most firms utilise the Internet and other forms of online communication to share information with clients and also pursue their quest for survival. Secondly, there are search engines that makes it convenient for potential tourists to acquire information and also for tourist operators to share their information. Due to the fact that there is a lot of cooperation in the tourism industry, most information about tourism destinations are online. And this again causes planners and bookers to go online to get more information about the destinations they hope t visit. Finally, there is the growth of e-commerce activities and tourism is one most appropriate sectors that financial intermediaries target. Therefore, it is apparent that the Internet shapes the context for business in the tourism industry and this in turn gets workers and consumers to visit the sites and plan real and actual visits to sites of interest. Bibliography Aiello, L., 2012. Role of meta-search engine in the relationship tourist/e-retailer. Rome, ICIDT. Buhalis, D., Tjoa, A. M. & Jafari, J., 2014. Information and Communication Technologies in Tourism. 12th ed. London: Springer. Coenders, G., Ferrer-Rosell, B. & Martínez-Garcia, E., 2015. Trip Characteristics and Dimensions of Internet Use for Transportation, Accommodation, and Activities Undertaken at Destination. Journal of Hospitality Marketing & Management, Volume April, p. To be Published. Edgell D. L., S. J., 2012. Tourism Policy and Planning: Yesterday, Today, and Tomorrow. London: Routledge. Kleijnen, M., De Ruyter, K. & Wetzels, M., 2007. An Assessment of Value Creation in Mobile Service Deliveryand hte Moderating Role of Time Consciousness. Journal of Retailing, 83(1), pp. 33-46. Mariani, M. M., Baggio, R. B. D. & Longh, C., 2014. Tourism Management, Marketing, and Development. London: Palgrave Macmillan. Medlik, S., 2012. Dictionary of Travel, Tourism and Hospitality. London: Routledge. Meng, S. K. & Chatwin, C., 2012. Measuring E-Marketing Mix Elements for Online Business. nternational Journal of E-Entrepreneurship and Innovation (IJEEI), 3(3). Nalin, S., 2014. Tourism Informatics: Visual Travel Recommender Systems, Social Communities. New York : IGI Press 3rd. OECD, 2012. Towards Sustainable Household Consumption? Trends and Policies in OECD. New York: OECD. Oppewal, H., Tojib, D. R. & Louvieris, P., 2013. Experimental analysis of consumer channel-mix use. Journal of Business Research, 66(11), pp. 2226-2233. Panda, T. K. & Mishra, S., 2013. Tourism Management: The Socio-Economic and Ecological Perspective. Washington: University Press. Rezdy, 2015. Travel Statistics for Tour Operators. [Online] Available at: https://www.rezdy.com/resource/travel-statistics-for-tour-operators/ [Accessed 29 April 2015]. Rodgers, J., 2014. Advanced Travel and Tourism. 2nd ed. London: Heinemann. Roque, V. et al., 2013. The Importance of Tourism Offices in Promoting and Building the Image of a Destination in Rural Areas: The case of Serra da Estrela. Lisbon, ORTE. Tourism Research Australia, 2011. Internet Use in Trip Planning and Booking. 10 September, pp. 1-7. Read More