Factors Affecting Tourism Technological Factors

As tourism is so unpredictable and volatile in todays world any changes, be they social, economic, environmental, political, cultural or religious can have a counter effect on the trends of the industry at that point. When it comes to travel consumers are incredibly influenced. Since the development of tourism began in 1700 (wikipedia article) it has changed radically in that it is available to the masses and with a wide choice. This report will study the technological advances and how this affects tourism through volume, type or impact on a place at a certain period. "... most of the worlds cities are now within 36 hours of each other ... Peter Haggett, 2001 Technological changes within tourism surround several different factors from medical advances to the innovative space tourism. Similar to tourism, technology is an ever changing and sometimes unstable business. Better communication, transport and safety have encouraged new consumers to the industry. Improvements in water supply, medicine and knowledge have meant areas are opened up which were not possible before technological advances. In todays society in which a consumer wants easier, quicker and cheaper service only technology has helped tourism fulfil the customers demand. The Dominican Republic had an issue in the late 1990s of a lack of technology. Supply of accommodation, services or even water could not meet the heavy demand of tourists coming to the country due to cheap air flights and warm climate (A2 Geography by Steve Cooper). Hotels were built quickly, but also poorly, creating issues of health and safety. The infrastructure in the country, especially at www.lonelyplanet.com/.../dominican_republic.gif the capital Santo Domingo and the beach resorts were at the brink of collapse due to growth in additional population. This shows how lack of technology affected the country. But investment was brought into the state and spending was put into the economy to improve transport, health, business etc. In the new millennium the country has now stabilised and still continues to collect tourists from oversees due to its attractive location on the Caribbean. (A2 Geography by Steve Cooper). Another massive effect on tourism is the rapid increase in online booking that has given consumers more opportunity to make a holiday. Through technological advances, online booking has been one of the biggest factors in affecting tourism, leisure and recreation in todays world. There were 37,600,000 Internet users in the United Kingdom (representing 62.3% of the population) in March 2007, according to Internet World Stats. This was up by 144.2% compared to 2000. (Internet World Stats, March 2007) and a new Google Survey has shown that surfing

the web has topped watching television as Britains favourite past time. On average residents in the UK spend 164 minutes online every day compared to 148 minutes watching television (Daily Mail, Friday 10th March 2006). This shows how much the internet is now an integral part of life and has had an effect on other aspects influencing the tourism business. More and more people are now booking their holiday on the internet, as many people are looking for a better priced deal than theyre being offered by their travel agent. Both holiday and airline bookings have not dramatically rose in s ales from the travel slump of 2001-02 due to the massive consequences of September 11th and the threat of terrorism which has increased (it saw similar slumps although smaller after the Madrid bombings and 7/7 terrorist attacks). The Iraq war, the SARS/bird flu epidemics and very consistent hot European summers have persuaded the usual long haul travellers to stay at home.

A World Map to show Tourist Origins by Million Annual Tourists

http://www.worldmapper.org/display.php?selected=20

Of all the air passengers in the world, 40% fly on aeroplanes registered in the United States. These flights are both domestic and international. In the year 2000 there were 1.6 billion aircraft passengers. In these statistics, every time a person takes a flight, they are counted as an aircraft passenger. Some people are passengers many times in a year so far fewer than 1.6 billion individual people fly in a year. This map was before September 11th 2001 and the influence of that meant less people from the US and Western Europe were travelling by aircraft any longer. This shows what effects this would have on the tourist industry.

"Tourists are very fickle beasts, even the perception that a destination is risky will lead to a marked decrease in tourist traffic." Dr Howard Rosenzweig, 2003. Technology has also aided the tourist industry especially airlines because of the better transport, infrastructure and civil engineering that has meant that places inaccessible before by car or train can be accessed swiftly. Significant features such as the Channel tunnel, Gotthard Pass tunnel and Mont Blanc tunnel have all helped tourists get to bordering countries a lot easier without using short haul flights. "Sixty nine percent of EU citizens indicated that travelling across EU borders is as easy as travelling in their own country." Elitsa Vucheva, 2005 World Mapper, Tourist Origins.

This has seen a loss in sales and therefore profits causing one of the hardest aviation crises of the industry. The number of job cuts that were announced in 2003/04 was well over 100,000 according to BBC News, November 2005. Routes had been slashed and several European carriers were barely clinging to life. The turmoil in the industry went from Aer Lingus to XL Airways, but times were changing and the industry needed something new. Survival tactics started to emerge and online travel started to show evidence of bucking this gloomy trend. The Interactive Media in Retail Group (IMRG), as cited in a May 21, 2002, Financial Times article had cited for many years that online spending was increasing and predicted it to triple at the end of the decade. Looking at ecommerce data overall, the firm counted travel as the biggest online sector, followed by electronic products and apparel. IMRG also said British shoppers were buying larger and more expensive goods online, such as furniture and kitchen appliances. This showed a large gap in the sub-market that needed to be exploited.

www.airlinelogos.net

All these airline companies saw job losses and decline in sales as a result of the 2001-02 crisis in travel.

At the start of the boom these were seen as survival tactics by the airlines and the government also pushed for more progress in online booking to make the travel industry more prosperous. The economic realities forced travel companies to be more efficient in running their business. Websites, for example were able to promote the latest ticket prices, particularly at a time Online Travel Spend when they were being slashed on a day-to($bn) day basis which was used to tempt Europe N.America U.K travellers back into the air. Similarly travel 2000 2.4 6.4 0.8 sites e-mailed a wide customer base with 2001 5.8 11.00 1.8 relative ease to promote special deals. It is 2002 12.7 18.7 3.7 Source: seen as the cheapest method of booking a Datamonitor holiday, the LogicaCMG (a marketing body) has said that phone bookings typically cost about 30 to service. By contrast net bookings cost around 75p. One of the biggest online travel sites Expedia, took an initial knock from 11 September, but then saw its transaction volumes recover by 80-85% during October. Like every travel company, we experienced a downturn, but we then recovered a lot more quickly than the traditional industry said James Vaile, managing director of Expedia in the UK. Online travel sites are also well positioned to exploit the recent procrastination by consumers in booking holidays. People are booking later than usual in recent years and the internet is seen as the obvious and natural place to hunt down last-minute
Online Leisue/Unmanaged Business travel sales in the UK 2006-2011 (eMarketer)
35 30 25 20 15 10 5 0 2006 2007 2008 2009 2010 2011 Ye ars

$ Billion

bargains. As this bar chart shows travel sales online rose rapidly from 2006-2007 and it is expected to continue to rise to over $30 billion. Top 10 upstream industries: 1. Internet: 56.56% The consumers werent only using the 2. Search Engines: 48.57% internet to book their holidays but also to 3. Travel: 25.25% research and gain knowledge of the 4. Destinations and Accommodation: destinations they wanted to go to. The 16.94% search engines were flooded with searches 5. Agencies: 5.43% over cheap flights, accommodation and new 6. Shopping and Classified 3.19% 7. Business and Finance: 2.80% destinations (as shown in the rankings). 8. Entertainment: 2.27% From the bar chart below it shows that web9. Net Communities and Chat: 2.26% search is the preferred method of obtaining 10. Email Services: 2.25% travel information with it being preferred nearly twice as much as personal (Hitwise United Kingdon Newsletter June 2007) recommendation, the second most preferred method. This is then followed by TV programmes, but the travel agents became the fourth option of consumers to collect travel information. Web-searches are high due to people liking to make their own decisions at their own pace and this cant be done in travel agents where they are pushed, poked and pressured. This is unpleasant for the consumer and has changed the trend in which consumers went to travel agents for advice, whereas now they would rather use the internet.
The internet is the preferred method of obtaining travel information
Other Method Newspaper Options Travel agents office TV Program Personal Recommendation Web Search 0 10 20 30 40 50 60 70

No. of People

A P ie Chart to s how the m ethods internet users book a holiday with Travel agent broc hures and book ing Teletext 17% Telephone after reasearching on internet 9% 55% O ther m ethod High s treet after res earc hing on internet Internet book ings

11%

7% 1%

As this pie chart to the left shows the internet has had a huge impact on the booking of a holiday, with 79% of all booked holidays using the internet in the process. Also, the internet has seen a large increase in the number of last minute" business as many tourists feel it is better-placed and they can search for the best priced,

Data from Nielsen/NetRatings study on holiday bookings

most suitable holidays or excursions. Furthermore, since the growth of the internet, online advertising has been used as a huge marketing tool, where holiday and travel providers can target large quantities of potential customers and keep advertising costs low. This has also been used to great effect as they appear to be a successful method and an efficient way of gaining business from the wallet-conscious consumers, whereas high street advertising receives less notice. Moreover, the internet has caused the high street travel agencies to close, therefore creating job losses within the businesses. This is mainly due to the fact that more people are booking direct with the holiday providers, thus cutting out the middle man and saving money by doing the research and booking themselves. This is usually done by using the internet or telephone booking where the overhead costs are much lower as an outlet has to be staffed and incur running costs such as electricity bills and also because of the larger volumes of people that are able to access the service. A recent example of this is was in 2001, when Airtours, the UKs largest tour operator had to cut one-in-seven of its high street branches in an effort to return to profitability. According to finance director David Jardine, around 120 shops going under the name Going Places were closed as the business stated that they were finding there was an increasing trend in customers wishing to book direct". On the other hand, online companies such as Expedia.com have seen their profits on the rise over the past few years as would be expected, although they had not anticipated such a large growth. For the last three months of 2001, Expedia saw its net income surge to $19m according to BBC News, compared with a loss of $2.6m in the same quarter of 2000 and also the firms revenues were in excess of $80 million for 2001, over double that for 2000, showing how quickly it has established itself as an efficient internet booking service. So in conclusion online booking for travel has dramatically changed tourism in the world. It has provided a less time consuming, cost effective and an overall efficient/productive method in organising tourism which has seen triggered a rapid rise in sales. Airlines are now recovering after effects that were unforeseen. BAA Limited, formerly the British Airport Association said seven UK Airports handled a total of 11.5m passengers in August 2006 making it a record summer with the highest number of passengers ever recorded over a two month period. BAA also revealed here was a 6.8% increase in passenger traffic for the 12 months to August 31st 2006. Bigger discounts and better security could tempt more people to book holidays online, a LogicaCMG survey (http://news.bbc.co.uk/1/hi/technology/3939035.stm) found. However, the future of online booking although seen as prosperous can also turn, but due to the recovery in airline business they are starting to hit back. Prices are starting to rise and now you must book early to get the best price. The same survey revealed that online discounts were still not high enough to tempt potential customers onto travel websites and that the process was still too complicated for some consumers. A serious issue with online booking is the fear of fraud. Consumers are not convinced that any personal and financial information they hand over would be kept secure by

online travel shops and this is slowing the potential growth that could occur otherwise. The Association of British Travel Agents (ABTA) sees the online travel market having a long way to go before it replaces high street travel agents. ABTA estimates that by the end of 2007 online travel will be 17% of the UKs 28bn travel market but this growth will only occur if trends continue as it relies on steadily growing numbers of people happy to book holidays online and as well as improvements in technology and the creation of better websites by travel firms. Issues over security, faults and complications need to be solved if this method of booking is to prosper. The travel industry although brash will always be around due to the need and want of consumers to travel. "For my part, I travel not to go anywhere, but to go. I travel for travels sake. The great affair is to move." Robert Louis Stevenson, 1879

Bibliography References o http://www.etcnewmedia.com/review/default.asp?SectionID=11&CountryID=53 o http://www.sasi.group.shef.ac.uk/worldmapper/posters/worldmapper_map19_ver5 .pdf o www.traveldailynews.com/new.asp?newid=14083&subcategory_id=77 o www.patp3.webbler.co.uk/doc.php?id=1824 o http://news.bbc.co.uk/2/hi/business/3556503.stm o http://news.bbc.co.uk/2/hi/business/3121865.stm o http://www.expedia.co.uk/pub/agent.dll?qscr=over&rfrr=13011&&zz=1184276601343& o http://www.emarketer.com/ o http://www.hitwise.com/ o Dove, Jane 2004 Tourism and Recreation pages 21-24 ATG o http://www.dominicantoday.com/app/article.aspx?id=24206 o Nielsen/NetRatings study on holiday bookings o http://news.bbc.co.uk/1/hi/business/1196691.stm o http://news.bbc.co.uk/1/hi/business/1787962.stm