Business & Tourism Management: A Study on Entrepreneurship in the Tourism Industry with a Focus on TripAdvisor

Business & Tourism Management

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Slide 1: Title Slide

Slide 2: Introduction

Definition:

• Business venture refers to the creation, operation as well as development of a business venture with the main objective of making a profit from meeting customer demands (Burns, (2022).

• It covers the process of searching for business opportunities taking the relevant risks and developing new economies.

Aim and Objectives:

• Aim: As a subtopic for the research, the current paper aims to investigate the phenomenon of entrepreneurship within the tourism industry with a particular focus on TripAdvisor.

Objectives:

• In this case, learn how self-employment fosters change over some time in the tourism sector (Blank and Dorf, (2020).

• Assess the impact reflected through analysing the profile of TripAdvisor which presented travel planning as a new way.

• What is an elaborate account of the traits possessed by a tourism entrepreneur?

Structure:

• An overview of what constitutes a business and what constitutes an entrepreneur.

• Introduction to tourism as a business field.

• Brief history and contributions of TripAdvisor to the travel industry.

Tourism Industry Context:

• Tourism entrepreneurship is the process of establishing value through the provision of distinct travel services, technology or experience (Kimball and Lussier, (2020).

• Solutions like TripAdvisor have become the new way of how people select and arrange their trips.

Tourism Entrepreneur:

• A tourism entrepreneur makes a market analysis of travel services and uses technology to innovate and deliver improved services (Mitchelmore and Rowley, (2010).

• Example: TripAdvisor’s co-founder Stephen Kaufer whose company popularised the crowdsourced review in the context of online travel planning.

Speaker Notes:

The business enterprise is defined as the process of developing, organising and expanding a business venture which seeks to meet customer needs for goods and services and in the process make a profit. Businesspeople are agents of this undertaking by recognising opportunities, and incidences of risk, and initiating change in the marketplace to generate sustainable enterprises. Entrepreneurship is therefore very central in today’s ever-changing and competitive global economy through the creation of new ventures specific to market needs, and increased growth, especially in the tourism sector.

This presentation will attempt to look at the phenomenon of entrepreneurship in the tourism industry, with particular reference to TripAdvisor and its role in travel. The objectives are threefold: to explore the role of entrepreneurship toward innovation within the tourism industry, evaluate the role of TripAdvisor toward changing the experience of tourism planning, and define distinct features of the tourism entrepreneur. In seeking to tell the story of TripAdvisor, we seek to explore how creativity and technology can revolutionise an industry and improve travel.

The areas that will be discussed in the presentation include the following. First, let us explain the basic ideas of business enterprise and entrepreneurship as a theoretical framework to comprehend their application under the conditions of the tourism sphere. In the next section, the focus will be on the relationships between entrepreneurship and tourism, with a special focus on the gradual changes in demand stimulated by tourists’ needs. Last, we will discuss how TripAdvisor grew up to become a market leader in the provision of travel planning services pointing out that the founders of TripAdvisor introduced two innovations that changed the working paradigm of online travel: crowdsourced reviews and subsidised vertical search engines.

Specifically, entrepreneurship decisions based on innovation, risk bearing and response to the demands of consumers are distinguished within the sphere of tourism. Founders of businesses in this sector usually create products or services, or a platform for travel that creates a distinct form of experience for people or changes the way they organise their holidays.

Slide 3: Case study: Trip Advisor

Overview of TripAdvisor:

• As of the year 2000, TripAdvisor is an online marketplace for travellers as well as tourism packages, flight and accommodation prices, and experience sharing. Originally it was mainly based on guidebook reviews, but changed to citizen reviews in 2001 because of user preference (Morrison, Rimmington, and Williams, (2016).

• It offers traveller-generated suggestions on all manners of trips, making the planning process easy and unique, experiencing fast international growth with millions of unique monthly visitors.

Founders:

• It all started in 2000, when two Harvard graduates Stephen Kaufer and Langley Steinert aspired to develop a focal point for travel info. The major entrepreneurial decision to shift focus to rely on users’ reviews differentiated the platform (Camilleri and Camilleri, (2018).

Business Model:

TripAdvisor’s business model is built on two core pillars:

• Crowdsourced Reviews: It helps users discuss their travel experiences or give ratings that can be helpful to others (Zhou, Wang, and Li, 2017).

• Vertical Search Engine: They can have a search engine that enables users to search or compare travel options.

• The company generates revenues based on the CPC model, and the key to revenue is partners rather than the travel search company itself (Solvoll, Alsos, and Bulanova, (2015).

Speaker Notes:

It is crucial to note that TripAdvisor with its start in 2000 has taken a central place among travel reviews and compassing services that offer fare comparison and bookings. Originally envisioned as a central repository for guidebook-style travel reviews, the platform underwent a significant shift in 2001 when the founders realised that users were more interested in crowdsourced reviews from fellow travellers rather than expert opinions. The change signalled the formation of TripAdvisor and the new generation of online travel planning. As users could discuss certain travel destinations, and leave their feedback and recommendations, the website turned into a Top-Rated travel search engine. The platform gained more and more popularity in the following years, gained millions of unique visitors per month and became one of the world’s leading travel trade sites (Taecharungroj, Warnaby, and Parker, 2021).

Stephen Kaufer and Langley Steinert were Harvard graduates who realised there was a need for better means of organising travel experiences. First, Kaufer and Steinert planned the project as a tool offering purely professional travel reviews and guidebook details. Nevertheless, they were able to follow the users’ demand and change the approach of the platform to enable crowdsourced reviews which allowed TripAdvisor to stand out from the competitors. A shift occurred it was the turning point of the company’s history and helped to grow and develop it. Still today, the basic concept of collecting user-generated content remains a focal point of the company to help it stay relevant in the extremely competitive marketplace of online travel agencies (Valderrama Venegas, 2020).

TripAdvisor’s business model is built on two core pillars: It includes crowdsourced reviews and a vertical search. The crowdsourced review system enables travellers to give their account of the particular service, ranking services such as hotels, restaurants and tourist attractions and even giving elaborated details about the particular service. This large database of content created by other users allows others to make more informed decisions with their travels, therefore making the process of planning a trip much more interesting and open. Moreover, TripAdvisor built up a vertical search engine to offer travellers a way to search travel choices including hotels, flights, and vacation rentals concerning the previous travellers’ evaluations.

Slide 4: Characteristics of Successful Entrepreneurs

Entrepreneurial Traits:

• Innovation: Successful entrepreneurs introduce new ideas or solutions, as seen with TripAdvisor’s crowdsourced reviews (Mariani and Nambisan, 2021).

• Risk-taking: Entrepreneurs take calculated risks to capitalise on opportunities, such as Kaufer and Steinert’s decision to pivot from expert to user-generated content.

• Vision: Entrepreneurs have a clear vision for the future, like the founders’ aim to revolutionise travel planning.

Concepts and Theories:

• Schumpeter’s Theory of Innovation: Business people interfere with markets through new ideas that alter the prevailing models (I??k et al, 2019).

• Drucker’s Theory of Entrepreneurship: New things are used by business people to generate benefits and to look for what others cannot see.

Case Study Application:

• Innovation: Both, Kaufer & Steinert sought to enhance the travel platform with the help of user-generated content.

• Risk-taking: A brilliant leap they made was changing from expert review to crowd review.

Speaker notes:

Certain characteristics of business owners and managers separate the winners from the non-winners. Such characteristics include innovation, risk-taking and vision considered the major abilities of an entrepreneur to notice opportunities and develop value-adding methods of meeting consumer demands and value delivery (Journal of Business Venturing 2024).

This presentation will argue and provide evidence that innovation is an important characteristic of an entrepreneur. Businessmen usually innovate to create a differentiation and disrupt existing markets. As with the case of TripAdvisor concerning innovation, Stephen Kaufer and Langley Steinert brought to market an idea of crowdsourced travel review that had not been realised before. They wanted regular consumers to be able to give updates, a radical idea at the time instead of allowing for expert opinion. This change brought a new era of user planning mechanisms where users could rely on real-life feedback from other travellers, thus allowing for a more open and inclusive way of travelling.

Another important characteristic is risk-taking. If one idea is to be taken forward, anyone who sets an enterprise in motion must be prepared to accept measured risk. When Kaufer and Steinert shifted the focus of TripAdvisor from professional feedback to the users’ testimonies, the company was at great risk. When the application was in the process of designing there was some confusion as to whether people would trust reviews from other guests than recommendations from such bodies as Lonely Planet. Thank God, this strategy did pay off, as within two months the platform became popular and received millions of users from around the world. The fact that the founders can go for this big risk is a sign that the travel startup is willing to disrupt the norms of the travel industry (Nobre et al, 2018).

One of the most basic elements of an entrepreneur is the ability to have vision and foresight. Successful business people can have a perspective of the future and predict market changes. The founders were quite clear-sighted about what they wanted to do – that was to disrupt the way people organised and booked their travels. The insight to focus on the concept of developing guest-driven, customised reviews made TripAdvisor pioneers of the online travel market before the concept was adopted by other businesses.

Another connected theory is Drucker’s Theory of Entrepreneurship, according to which an entrepreneur identifies opportunities for change and builds a new organisation which focuses on these changes to create value. For Drucker, opportunities intended by the businessman include recognising changes in technology, consumer behaviour patterns or the market. The initial TripAdvisor founders noticed that the trend was changing and adopted a new business idea out of it (Mitra, 2019).

Slide 5: Innovation in Tourism

Impact of Innovation:

• These findings indicate that innovation fosters growth in customer experience and efficiency in tourism business ventures. It assists firms in creating a niche within a competitive environment that mainly deals with the provision of services and products.

Case Examples:

• TripAdvisor empowered engaging travel planning with the help of post-booking content created by customers; Airbnb shared a business model for peer-to-peer lodging services. Both examples demonstrate how innovative ideas can challenge conventional strategies of tourism (Rossi, 2022).

Influences on Innovation:

Key factors influencing innovation include:

• Technology advancements: With the use of mobile apps, artificial intelligence and Virtual Reality travellers embark on their journey and organise it differently.

• Consumer trends: The need to have tailored, easy-to-access, and environmentally-friendly travel solutions is compelling for businesses.

Examples of Innovations:

• Initiating, modifying or cancelling a trip has never been easier with dominant online booking companies such as Booking.com and Expedia (Stivala, 2022).

• Etc, utilises virtual tours where the traveller can view the set destination from the comfort of their home.

Speaker Notes:

Innovation has been established to play a key vital in the growth and competitiveness of business enterprises especially in the tourism sector. The tourism industry is very competitive and companies that operate in this industry are always on the lookout for ways to improve the customer signals, cut costs and stand out from the competition. Innovation could help tourism companies to provide new services that meet new consumers’ demands and hence increase satisfaction and loyalty. As is witnessed, innovation through technologies or business models can be of great benefit playing a major role in changing how people experience travel (Streimikiene et al, 2021).

The best example of innovation in the context of the tourism sector is TripAdvisor which changed the way people are choosing travelling destinations by offering user-generated reviews. They took advantage of this approach to share their own experience and recommendations instead of having to rely on so-called expert advice or travel books. Another example is Airbnb which changed the accommodation industry by proposing an online platform for P2P accommodation rentals. As the platform for meeting locals in different cities, Airbnb offered non-traditional methods of accommodation, being closer to comfortable housing sharing. Innovation that also leads to change in consumer behaviour is evident from both the TripAdvisor and Airbnb examples.

Various factors affect innovation in the tourism sector. Innovation is accelerated by technology advancements which are one of the biggest innovations. The users are getting smarter, and with the help of technology such as digital platforms, mobile applications and artificial intelligence (AI) the world of travelling has changed significantly. Online travel companies through its various apps like Expedia, Booking.com and Skyscanner facilitate travel management while chatbots and virtual assistants powered by artificial intelligence present personalised solutions to client concerns. The other is the customer buying behaviour in that consumers tend to seek unique and seamless experiences (Buhalis et al, 2019).

Some examples of innovational approaches are the usage of the World Wide Web for bookings and sales of flights, accommodations and activities such as Expedia or Booking.com. Another set of unique and innovative PR tools is online sightseeing which is also correspondingly named, as this tool allows the viewer to get acquainted with certain sights before a lasting meeting with them. Due to the COVID-19 situation, it became preferable to use this technology, because a lot of people could not travel.

Slide 6: Organisational Culture

Definition:

• The organisational culture may be defined as the norms, attitudes, behaviour patterns and expectations that employees embrace concerning the organisation in which they work. It acts on processes such as general decision-making, information exchange, and business behaviour (Williams, 2022).

Importance:

• Organisational culture, in this case, is an essential factor in employee engagement, performance and direction of the organisation to achieve its set objectives. It fosters a feeling of being valued, increases cohesion, and plays a part in the ability to find and keep the best people.

Examples of Performance-Driven Organisational Culture:

• Tesco

• Unilever

• HSBC

• Diageo

• Rolls-Royce

Case Example: Tesco

• The measures that Tesco uses to support the performance of the staff are goal setting, training and performance rewards. Its “only grown-up grocery business with a ‘Serving Britain’s Shoppers a Little Better Every Day’ mission statement energises the employees to pay attention to customer service and creation.

Speaker Notes:

Corporate culture can be defined as the set of shared principles which guide employee’s attitudes, behaviour and actions in the course of their functions within an organisation. It applies to an organisation’s leadership personality and underpins everything about that organisation, including how employees organise their work and interact with one another. Culture is also an important determinant of decisions, communication processes and approaches to problem-solving. It is the stealth-like power which drives the character of an organisation’s working environment and can thus define success in terms of staff engagement and accomplishment as well as organisational performance (Cherian et al, 2021).

It is therefore clear that a strong organisational culture is very important in the long run when it comes to the business. It provides everyone in the organisation with that sense of place and direction by ensuring they are on the same page as the company. Employees prefer working for an organisation they understand and appreciate its culture as it encourages optimum performance. Positive organisational culture promotes the right spirit within subgroups when dealing with each other thereby enhancing interaction that is vital for the development of innovative solutions. Furthermore, organisational culture can work in its favour to ensure high-quality employees are recruited and retained. Some of the many organisations with performance-oriented cultures are companies based in the United Kingdom. Some among them are Tesco plc, Unilever, HSBC, Diageo and Rolls-Royce. They promote organisational cultures that insist on responsibility, creativity and recalculations, these aspects inform the competitiveness of these firms in their relevant fields (Yun et al, 2020).

Taking Tesco as an example, the company promotes a performance-driven culture by setting clear objectives and aligning all employees with its core vision: “A Little Better Every Day for Britain’s Shoppers.” Tesco helps to make sure that each worker and manager knows what his or her part in accomplishing this vision is. Performance measures of the company include training and development, setting up several goals and objectives, and encouraging and rewarding effective employees. In turn, this encourages employees to contribute as part of the Tesco team by giving them some of the necessary tools to allow them to be part of this team.

Slide 7: Role of Leaders in Organisational Culture

Leadership Influence:

• Culture in organisations can be influenced and developed positively by leaders through examples, and examples exhibited by the organisations. It determines how the employees relate to the company mission vision and organisational values and also promotes an organisational culture that encourages innovation and accountability (Warrick, 2017).

Examples

• Tesco: Management at Tesco pays attention to customer care and organisational efficiency and values performance and productivity, which make employees pull through their best to bring out the best in them (Ajibola, 2022).

• Unilever: At Unilever, sustainability and social issues are at the helm leading to the integration of the goals and objectives as key organisational values.

• HSBC: HSBC has a positive attitude towards corporate ethics and international cooperation as managers encourage openness and good decision-making.

Speaker Notes:

Employees remain one of the most important pillars in organisational development and sustainability; they are the focus as to how a company’s organisational culture should be and how it can be developed. Culture is the way an organisation and its leaders behave and communicate values, thus making it either possible or impossible for the employee to succeed. Leaders create significant links with culture because they oversee the organisation in making the values and vision of the firm compatible with operations and strategies. They act out the behaviours they wish their employees to portray, clarify what the business deems significant, and develop rules that correspond to organisational culture (Rego, Cunha, and Polónia, 2017).

Yet, of all the methods that leaders apply to regulate and transform organisational culture directly, the process of communication may be the most revealing. One of the benefits of highly developed corporate vision concepts is that leaders outline the objectives which serve as the company’s guidelines. When there are frequent reminders of its values and how they apply to business, then the right culture is re-established. Also, leaders who are more open and truthful with information create healthy organisational relationships with their employees (Lasrado and Kassem, 2021).

Within Tesco, leaders work on bringing a culture encompassing the idea of customers and performance. Managers actively promote the idea of employees enhancing organisational performance while placing great value on the quality of service offered to customers. Through effective communication of expectations, training, and attributions, Tesco leaders guarantee that its organisational culture enhances its strategic objectives of achieving high-quality service and upgrading customers’ daily shopping experiences.

Lack of effective leadership in shaping culture can also be seen in organisations such as Unilever. As it is highlighted above, Unilever’s management makes sustainability and social accountability the main organisational values that are integrated into its business activities. Top management within Unilever practices the area of sustainability and ethical practices emphasising and integrating them into their operations through the promotion of decision-making that is sustainable both in social and environmental perspectives.

HSBC encourages ethical characteristics and globally responsible working. Leaders of the bank have embraced setting ethics and transparency as major goals in an organisation. This focus on ethical leadership guarantees that HSBC sustains the general image of responsibility in the seriously monitored banking industry.

Slide 8: Customer Satisfaction & Validation

Customer Influence:

• Customer validation has a direct impact on TripAdvisor as user reviews form opinions about the hotels, restaurants, and travel experiences. The positive comments directly increase the sites’ popularity and the number of bookings while negative comments make businesses enhance their services.

Using Customer Reviews for Validation:

• Using customer reviews, the services provided by travel providers can easily be evaluated by travel business companies such as TripAdvisor, therefore enhancing the level of credibility and openness. It also makes sure that the standard of listing on TripAdvisor is kept high through the kind of reviews it displays.

Steps to Improve Customer Feedback:

• Offer response with post-trip prompts and simple review processes.

• Encourage people who post long descriptions to reply to the message with a discount or a reward.

• Optimally, set up a reactive review management system that will be useful in handling a few grievances promptly.

Example:

This hearty endorsement from the travel reviewers on TripAdvisor makes the website trustworthy when it comes to travel reviews. For example, a comprehensively rated hotel can drastically upgrade its brand affiliation and gain more attendance due to the reviews.

Speaker Notes:

Customer validation is central to decision-making on the TripAdvisor platform because the platform relies on customer reviews. Customers’ commentaries and comments have a direct impact on the evaluation of businesses and determine their performance. It also pays travellers to provide good comments on their experience on the site by causing an upsurge in the flow of customers to hotels, restaurants, and other travel-related facilities as well as improved business returns on the part of TripAdvisor. On the other hand, negative comments can make business organisations take appropriate action to enhance their products and services. This feedback loop is important because customers’ recommendations are more credible than those of an expert, which makes TripAdvisor a useful tool for travel (Filieri et al, 2021).

By incorporating customer reviews, TripAdvisor can be in a position to confirm the service quality of the travel providers. By offering these reviews, readers can give TripAdvisor information nearly instantly regarding the positive and negative aspects of different companies.

Such feedback is important as it assists the platform in keeping its bar high with the constant updates and improvement of the list. Holding and displaying only the most credible and highly rated companies and establishments has the effect of increasing TripAdvisor’s reliability and reliability as a travel guide. Operation kinds its reviews as social proof, enabling TripAdvisor to verify the accuracy and the quality of the services provided by its partners. This also promotes the need for business providers to improve and deliver the best services as they are aware that the customers’ results will be reflected in their online rankings and bookings.

Thus, to enhance the customers’ feedback on TripAdvisor, there are several measures to be taken. First, TripAdvisor can use follow-up notifications that will remind tourists to write more reviews after their trips. Also, changing how users submit their reviews will make it easier for the latter to provide feedback. They also pointed out that, providing some additional bonus such as a discount or other kind of reward for the more detailed and representative reviews could also be effective in cases when several users do not provide any feedback. In addition, it also means that TripAdvisor can introduce a quicker mechanism of moderating reviews, so negative reviews can be answered either by the platform or the organisation. To address some complaints, customers have to be called directly and informed that their comments are important and will need this or that to be fixed.

Slide 9: Conclusion

Introduction to Business Enterprise and Entrepreneurship:

• Explained business enterprise and entrepreneurship.

• Focused on tourism as the field of activity and analysed the company TripAdvisor as an entrepreneurial object.

TripAdvisor Case Study Summary:

• Emphasised the main idea and the founders of the company and briefly described TripAdvisor’s business model activity.

• Explained how crowdsourced reviews of TripAdvisor have affected the travel industry.

Characteristics of Successful Entrepreneurs:

• Discussed modes of entrepreneurship, for example, innovations and risk-taking.

• Applied theories to TripAdvisor’s founders, Stephen Kaufer and Langley Steinert.

Innovation in Tourism:

Explored the role of innovation in the context of tourism concerning things like digital platforms and AI.

Specific factors that were highlighted concerning the innovation include technology and consumer pull factors.

Organisational Culture and Leadership:

• Discussed how leaders influence organisational culture through the examples of Tesco and Unilever.

Customer Satisfaction and Validation:

• Explained how customer reviews as a form of validation of services are employed by TripAdvisor and being used to enhance customer feedback.

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