The Global Tourism Industry - Assignment Example

The Global Tourism Industry number] The Global Tourism Industry Answer a) Definition: “Inclusive tour can be defined as a tour consisting of a package holiday provided with transport and accommodation. Transport can be in a form of air travel or via land. Services provided include car rentals and other interesting activities. Package holidays are sold by travel agents and organized by tour operators for costumers. Special services are provided for disabled or persons (Sens Agent, 2009) b) Factors that contributed towards tour operations: In 1950 tourism operations developed as tour operators became significant part of the travel and tourism industry. There are certain factors that contributed to the growth of tourism operations, for example advancements in air travel made it easier for a large number of people to travel across countries and cities in a very short period of time. Moderate prices, increase in disposable income, and leisure time gave rise to tourism trends. Media has also played an important role for the growth of tour operations. Media has provided awareness to people regarding tourism and has developed an interest among them for travelling. An example can be found in how media coverage promoted Egyptian tourism. Media coverage of events and activities in Egypt has developed interest in western people to visit the country. Media services have performed constructive function for tourism industry by exposing unique characteristics of Egypt (Hotel Mule 2010). c) Types of specializations: There are different types of specializations for tour operators. Two key types along with their respective examples are given below: 1) In Italy mostly tour operators prefer to specialize in specific tourist market areas in order to avoid fierce competition. They chose it because they do not have stability to fight against big powers. They collect extensive information about the local area that they study and try to offer something different from the bigger tourism groups. An example of this is Intras agency. This agency has 25 years experience and it offers different package holidays with special packages during the rainy season (Article Alley 2008). 2) Some tour operators chose to specialize in bicycle tour operation. These tour operators generally work on an individual level and plan or organize tours that are based on area. A bicycle tour operator should have excellent communication and organizational skills. He or she must be physically active and should have ability to resolve conflicts quickly before and after the tour. Being a bicycle tour operator it is essential for him to enjoy outdoor physical activities (Job Profile 2003). d) Tour Operator`s benefits: Tour operators provide benefits to both customers and suppliers of tourism services. To customers they offer tour packages at low prices as compared to those arranged by individuals because they buy services in bulk quantities at discounted price from travel agencies and then they pass on such services to customers. It is common to see tour operators publicize the services of hotels and airlines through brochures. They engage in marketing for their supplier`s products and often have to guarantee a significant numbers of costumer to suppliers (Hotel Mule 2010). Answer 2: a) Importance of Brochure: An advertising brochure is an efficient tool for marketing and it is a good way of communicating with clients. It has the ability to promote new or old products to clients. Brochures are used frequently to advertise a business. They provide complete information about the available services. Basically brochures provide an overview of the program. Pictures and illustrations that are presented in brochures play an important role in marketing and help both suppliers and customers (Matthew 2003). b) Market Research: It is important for tour operators to conduct market research in order to learn about the strategic use of information technology to provide best service to the costumers. Market research helps them to get up-to-date and relevant information about other travel agencies so that they can differentiate themselves from their competitors. Through market research tour operators also aim to identify customer`s current interest and needs (Kozak, 2004). c) Home research and destination research: Tour operators conduct home research and destination research through tour websites and brochures to gather information related to accommodations, holiday packages, and attractive event offers so that they can properly guide their customers more effectively. It is very important for tour operators to assemble all information about the tour destination through strategic use of technology in order to provide best services to customers. Tour operators are expected to find destinations that can be trusted to attract people from different cultures and countries. They should make sure that these destinations will satisfy their customers (Kozak 2004). Question 3 a) Charter Airlines: Charter airlines operate Charter flights that are arranged by hiring particular costumers that take place outside the normal schedule. Package holiday includes Charter flights along with accommodation and other activities. Such packages are cheaper than scheduled airlines. Planes of schedule flights are planned to fly a particular route at particular time whereas charter flights provide last minute discount unlike scheduled flights (Wise Geek, 2003). b) Low Cost Carriers: Low cost carriers are also known as budget carriers. They have low fares as compared to other competitors. They provide low price tickets but they charge extra for food and seat allocation. Low cost airlines allow more people to visit different places but the growth of the low-cost airline industry has adversely affected the quality of services provided by large-scale airline companies. This is because a large number of people prefer travelling through low cost airline due to its cheap fare; this has decreased number of costumers for other airline services (Jassem, 2010). c) Liberalization: Liberalization policies have a significant influence on the aviation industry in Europe. Such policies encourage them to run HS-system and also encourage different airports to increase their sizes in order to accommodate additional traffic. The liberalization of the European Airline Industry has enabled airlines to choose the network that is most profitable to them (Adler & Berechman 1996). Question 4: a) Travel Agent and Tour Operator: Figure 1: Positions of Tour Operator and Travel Agent. Source: (Wattle Software, 1999) The tour operator works as a tour guide. He handles the group and organizes the package holiday. He makes contacts with the hotels and resorts as well as airlines for the tickets and he is responsible for assembling information about travel destinations. In contrast to the tour operator, the travel agent acts as a ticketing agent. He does not operate tours but he gives advice to travelers and he sells travel products such as tickets, and package tours. Consumers look towards travel agents to provide details about the best tickets and travel destination packages. The travel agent is mostly set up in prime location such as inside the shopping malls or beside main roads (Ong 2003). b) Types of Integration: There are two types of integrations in travel industry: 1. Horizontal integration: It handles few parts of the production process. It is a form of advantage travel and it aims to make economies of scale. 2. Vertical integration: It is engaged with different parts of the production process e.g. growing raw materials, manufacturing, transporting, or marketing. There are three varieties of vertical integration Backward vertical integration Forward vertical integration Balanced vertical integration Vertical integration specifically balanced vertical integration is more appropriate for tour operators as it deals with all components from raw materials to final delivery (Eco Teacher, 2010). c) Barriers to Entry: Barriers to entry can be defined as factors that make it difficult for a new company to compete against companies already established in the field. These factors include trademark, copy right technology or costumer`s loyalty. These factors adversely affected the structure of the travel industry. For example large scale travel agencies have existing costumers loyal to their products or services means presence of established competitors could serve as a barrier to entry for the new company (Money Terms, 2005). Answer 5: a) Roles and Functions of a Travel Agent: A travel agent acts as a ticketing agent for transportation; for example bus, train, and airlines. He buys tour packages or tour services at discounted rates and attempts to sell them at a profit. For his services the travel agent gets a commission from suppliers and other tour companies. The travel agent provides all information related to tickets and destinations. He also offers advices to costumers and sometimes serves as a general service agent for foreign travel companies in different countries (Jenniferadams 2010). b) Selection of Distribution Channels: The type and nature of services provided by the distribution channels are important factors that should be considered while choosing the distribution channel. The tour operator must check that services are being sold at moderate prices and other important factors should also be considered. It is almost always feasible to take advantage of electronic means in this regard (Kozak, 2004). c) Influence of Internet: Internet has become a new source of information for costumers about tourism destination. People have started using tour websites for getting information related to tourism. Internet has replaced travel agents as a result number of travel agencies are closed now (Kozak, 2004). d) Current Environment: The internet has changed the tourism industry by providing valuable service to people travel agents and enabling them to clearly understand costumers`. This also allows them to provide consumers with specialized knowledge regarding available solutions. Travel agents should make strategic and tactical travel plans according to costumers` requirements (Kozak, 2004). Answer 6: a) Consumer Behavior: Change in consumer behavior gave rise to new tourism. Behavior of new tourists is significantly different from the older ones. As compared to old tourists new tourists have more flexibility. They are more independent and quality conscious whereas old tourists were less conscious about value and money. Change in consumer behavior has created problems for tourism industry. New technologies, more experienced customers, global economic reforms and environmental restrictions are other factors involved in effecting tourism industry (Kozak, 2004). b) Needs of New tourists: It has been observed that increased leisure time and desire to live in healthy atmosphere has developed special interest of travelling among people. Numerous niche markets have emerged within the tourism industry such as adventure, sports, and health tourism to cater to the needs of new tourists. For example advancements have been made in the destinations that are perfect for fishing, hunting, and other sports to cater to the needs of those who are interested in sports. Rise in global standard of care and low price of medical tourism packages have been introduced for those people who are unwilling to compromise with their health and want to receive medical treatment at reasonable prices from foreign countries (Medical Tourism 2010). c) Distance Affecting Global Tourism: It has been observed that 80% of all international travel occurs to destinations within 1000 kilometers. Most of the people avoid travelling to other countries due to great distance. For example Fiji Indians like to visit India but most of them cannot afford to travel India because of distance. Similarly distance travelling within Europe is significantly less, distance has adversely affected global tourism flows (Kozak 2004). List of References Adler, N. and Berechman, J. (1996) Airport Choice And Hub Development [online] accessed from [accessed 6 July 2010] Article Alley. (2008) Travel-and-Leisure [online] accessed from [accessed 6 July 2010] Eco Teacher. (2010) Vertical and Horizontal Integration Defined [online] accessed from [accessed 6 July 2010] Hotel Mule. (2010) Tour operator [online] accessed from [accessed 6 July 2010] Jassem, D. (2010) Low-cost carriers give bus companies a tough time [online] accessed from [accessed 6 July 2010] Jenniferadams. (2010) Travel Agents [online] accessed from [accessed 6 July 2010] Job Profile. (2003) Bicycle Tour Operator [online] accessed from [accessed 6 July 2010] Kozak, M. (2004) Destination benchmarking: concepts, practices and operations. London: CABI. Matthew, E. (2003, July) Business and Marketing [online] accessed from [accessed 6 July 2010] Medical Tourism. (2010) Medical Tourism Guide [online] accessed from [accessed 6 July 2010] Middleton, V. M. (2009) Marketing in Travel and Tourism. New york: Butterworth-Heinemann. Money Terms. (2005) Barriers to entry [online] accessed from [accessed 6 July 2010] Ong, G. (2003) Travel-and-Leisure [online] accessed from [accessed 6 July 2010] Sens Agent. (2009) Inclusive Tour [online] accessed from [accessed 6 July 2010] Wise Geek. (2003) What is a Charter Flight? [online] accessed from [accessed 6 July 2010] Read More