Contemporary Issues in Travel and Tourism Assignment Trail finders
Contemporary issues in travel and tourism assignment trail finders report will show the skills which has been developed on the topic of travel and tourism. This covers the current issues and trends which are developing in the tourism sector and will develop an understanding on the changes in the industry and how the organizations respond to these changes. There are lots of current issues which shape the growth of the industry as a whole. To know how the organizations respond to the changes in environment of industry, different brands will compared and their strategies will be developed on the basis of given case study. Also, Niche tourism market of UK will be taken into consideration (Mason, 2008).
The task is related to the current issues driving the change in the travel and tourism industry and there are many issues which will be discussed which bring challenges in the industry and to the travel companies and tour operators. Trailfinders is one such company in UK which follows a approach of matching the customer’s demands with the tour planning and they make the dream trip happen for the visitors by designing ideal itinerary for them (Trailfinders, 2016).
1.1 Analyse issues currently driving change in the travel and tourism sector for a selected tourist destination. You have to include at least three issues and give a detailed explanation of the issue and its impact on the travel and tourism sector.
United Kingdom is one such nation which is among the highest attraction for visitors to travel. This might be because it has excellent infrastructure, culture and heritage buildings, sports events, shopping destinations for fashion lovers and also many visitors come for education and job purpose. Being an assistant manager at Trailfinders, a UK tour operator, certain issues which currently drive the changes in the travel and tourism industry of UK are discussed below:
- Terrorism: Terrorism is a very big factor which affects the tourism of any place. Because of Terrorism, the tourism of any place gets affected and the no of visitors are affected because of the same. According to Trailfinders, the no of tourists decreased after the attacked and riots in London in the year 2005 and 2011 respectively. Tourists will stay away from the places where there are these attacks and chances of crime (LaGrave, 2016). For e.g. the twin tower attacks in U.S in 2011 impacted its tourism industry because the people preferred not to visit the country which has been attacked recently. Same happened with London where the terrorist attacks in 2005 declined the no. of tourists. According to a report about Travel trends by TravelZoo, the no of tourists declined in Paris, UK and France after the increase in terrorism activities where the no of tourists in UK declined from 48 percent to 29.6 percent.
- Economy: The economy plays a significant role in the growth or downfall of the economy. Economic conditions attract or repel the tourists towards the particular country (Council, 2015) the economic issues can be unemployment, fall or rise in the currency, etc. Fall in the inflation will attract many tourists to UK as people can now afford the trips to UK. The goods will be dearer and it will be easier for people to afford the trips. UK will get more tourists from other countries. Also, the employment rates affect the tourism like U has been facing low economic growth and unemployment in recent years which will attract less young people to visit UK for education or career which will also bring downfall in the overall revenue for the country.
- Health factors: Diseases outbreaks can spread fear in the mind of people and people do not prefer to visit the places which are suffering from the outbreak of certain diseases like Swineflu, Ebola, Birdflu and more. People take vaccinations before travelling to any country to prevent them. The government should take severe steps to prevent tourists from such problems (Mason, 2008).
1.2- You should analyse at least two different current issues using appropriate methods and resources in depth focusing mainly on the impact of political unrest in the Middle East and North Africa, terrorism and counter-terrorism measures, severe weather, local and international laws.
There are certain current issues which will be evaluated in this section using appropriate sources; these are given below in points:
- Terrorism: Terrorism is the fear of violence spread among the people of country. The impacts of terrorism are disastrous. They lead to unemployment, deflation, poverty, homelessness and more. Terrorism is an evil activity which not only spread the fear but also affects the economic conditions of the country. This also affects the arrival of tourists in the nation which also brings the drop in the demand and as a result the business goes down, the revenue losses are faced by the nation and the growth disappears (Zillman, 2015). It affects the tourism of the place as the tourists do not prefer to travel to a place which has higher chances of terrorism attacks and which is not safe for them. This can be made clear from the Syria civil war where after the war, the tourism fell drastically and some of the hotels have to shut down their business due to drastic downfall in the occupancy of rooms. The tourism industry of Syria used to contribute 5% to the economy but it is all finished after the war and political instability (Martin & Springer, 2012).
- Severe Weather: Severe weather impact tourism of a particular place. The extreme situations destroy everything at a place and make a very uneasy place for the tourists. For e.g. there was a serious drought in Scotland in 2011 and around 29 wild fires broke out which destroyed the natural beauty and ecosystems of the place, Tourists are attracted to wildlife and landscapes and this incident declined the no of tourists visiting to experience the wildlife.
Another example is to Britain floods in 2014 which affected many parts of England and Wales. These situations create various disruptions for tourists to come and visit the places of attractions.
Providing sufficient supply of water and by conserving the wildlife could create opportunities for the country to attract more tourists (Clark, 2013)
This task is about the current trends and their influences which bring change in the UK travels and tourism sector. Being an assistant product developing manager at Trailfinders, these issues will be discussed below in the form of report which will be made with the help of available statistics, tables and data. The data for niche tourism will also be discussed which shows how a particular sector contributes to the tourism of UK.
2.1 You should evaluate current trends influencing change in the UK travel and tourism sector. Your information pack should include latest available statistics regarding the number of tourists and main tourism markets in UK. You need to make use chart, data and text tables.
The current trends and their influences which bring change in the UK travels and tourism sector are shown below with the help of data and statistics:
- Growing use of Internet: The use of internet has increased with the increased usage of technology all over the world and in almost every sector. The bookings for trips are made over internet and people can also search about the particular destinations, its main attractions and the facilities for accommodations and food. Also they can check the reviews for a particular place which are shared by the experienced visitors. This has made easy for people to spend holidays. The chart below clearly shows that how internet is having a big share for booking holidays (Martin & Springer, 2012)
Bookings made through various methods
The above chart shows that around 26.4% of the customer’s book tours through online agencies which is a very big share and is more than travel agents which is used by only 9.6% of the tourists.
Online planning for travelling
- Inbound tourism: Inbound tourism is when the residents of other countries visit UK for travelling. UK has popular tourist destinations which attract most of the visitors like Tower of London, British Museum, Manchester and many more. Inbound tourism has increased over the years in UK which is clearly shown in the below given chart where the no of tourists has been increased over the years from 2001 to 2011 and also the average spend per visit has been increased from £563 to £584. The reason why tourists want to visit UK for visit are many like good weather conditions, lesser crime, infrastructure facilities, transport systems, attractive shopping markets, etc. (Cooper &Hall, 2008).
- Outbound Tourism: Outbound tourism is when the visitors go out of the resident country to travel. The outbound tourism of UK has decreased gradually. The chart in the next slide will make clear how the outbound tourism of UK has fallen over years. The reason for this fall is many like the spending capacity of people has decreased due to recession and lower economic growth. The outbound tourism of UK contributes around 30 billion pounds to the UK economy which is approximately 2% of the GDP of UK (Martin & Springer, 2012)
Decrease in Outbound Tourists
2.2 Your company wants to expand into the niche tourist market. You should analyse a current trend using appropriate techniques and resources and produce a fact sheet to be included in your information pack. You need to analyse one niche tourism market and provide detailed description about it, including reasons for its increasing popularity, and most recent travel statistics. You should include data and text tables, and charts in the fact sheet.
Niche tourism is when the tour packages are specially designed to meet the needs of visitors. These are the special categories which are individually promoted and are capable of attracting tourists to the country. In this assignment heritage tourism of UK has been evaluated. Heritage accounts for a significant part of UK tourism which helps in achieving growth to the economy. It accounts for around 2% of GDP of UK. Heritage is also an important employer which produces thousands of jobs to the people in UK. Heritage is a key driver of international tourism in UK. In the year 2013, UK ranked as 8th for international tourism and it has around 31.2 million visitors in the year which is 6.4% more than 2012. This shows that the no of tourists are increasing year by year and year and heritage plays a main role in attracting the tourists (England, 2015).
No. of Historic visits
The above cart shows that 58.6 million visits are done to historic places of UK in 2013 among which 73% were adults.
According to the data collected by Visit Britain, the tourists increased their visit to heritage sites in recent years. Heritage tourism is more popular and is visited more by the people than in rest of the Europe. According to (Thomas, 2013), The top heritage sites of Britain are Tower of London and Edinburgh which brings approximately £26bn for country’s economy and UK has a mixture of old and new culture which attracts the tourists the most. The culture and history is found in the architecture of the UK’s buildings, castles, museums, stately homes and more. A research by Visit Britain shows that most of the tourists visit Britain by getting attracted to its USP which is its mixture of old and new heritage.The biggest competitors of Britain’s built heritage are France and Italy. UK has 28 sites which are the part of UNESCO’s World Heritage Sites.
City Of Bath in South- West England
Being a part of the Strategy development group in International Airlines Group which is one of the biggest airline groups in United Kingdom, I have to prepare a management report for discussing the issues given below:
3.1 Analyse how International Airlines Group businesses could respond to change.
International Airlines group is an airline group holding multiple companies and it functions in many countries. It has 100% holding in British Airways and Iberia and also in British Midland International. It has its headquarters in London but it is registered in Spain. The company also owns shareholding in Aer Lingus and Vueling. Qatar Airways holds 15.01% stake in International Airlines group (CAPA, 2016).
The SWOT and PEST analysis of International Airlines Group (IAG) will help in analyzing how the company could response to the changes. SWOT is a tool which analyzes the internal and external environment of the company by evaluating the Strengths, Weaknesses, Threats and Opportunities which is faced by the company.
- Strengths: IAG is one of the biggest brands in UK which operates in 274 destinations and it carries millions of passengers which show that it has brand value and the customers of IAG are satisfied with the services which is the biggest strength of the company. The company has been registered with the stock exchange of London and has ample amount of investors. It also has good portfolio of brands (Hall, 2008).
- Weaknesses: The Company’s weakness is growing prices of fuel and other raw materials. It functions are also interrupted because of rigid regulations by the government and high competition from other brands like Ryanair, Easy Jet and Lufthansa.
- Opportunities: The Company has the opportunity to beat the competitors and expand its business. This can be done by acquiring more airline companies for more market coverage and for better functions. The company also has the opportunity to increase the no of customers which can be done by adopting promotion techniques like offers and discounts to customers, advertisements, coupons, etc. IAG can also adopt latest technologies to attract more customers.
- Threats: The Company has the threat from the existing competitors and from the emerging airlines in UK. The company has a big threat from the low budget airline groups like Ryanair, Easy Jet, Monarch airlines, etc. It also has a threat from the changing rules and laws of the government (Hall, 2008).
- Political Analysis: IAG has to follow the rigid rules made by the government and political powers. The safety standards which are set have to be followed which are designed for the safety of the passengers.
- Economic analysis: Economic changes affect the functions of IAG. The rising prices of oil will increase the cost of the operation for the company. Also rise in the fares due to change in the rate structure will lead to low no of passengers than before because a set of people cannot afford high priced airlines (Holden, 2008).
- Social analysis: The lifestyle of a person is affected by its age, gender, lifestyle and social reference groups. These influence the choices of the customers and people chose the airline brand with reference to these factors.
- Technological analysis: IAG is also influenced by latest technology which should be adopted in order to be at par with the technology adopted by the industry and to attract customers. For this, it has also developed it online websites and mobile applications which helps in making the booking process easier and convenient for the passengers and they prefer the brand which provides them maximum satisfaction (Holden, 2008).
3.2- Develop strategies on how International Airlines Group businesses such as British Airways, Iberia, Vueling and Aer Lingus could respond to change. You need to select and develop strategies for at least two businesses. Provide detailed explanation of your strategies.
IAG has to develop some strategies which enable International Airlines Group to respond to the changes. There are many brands of International Airlines Group and here two of the brands are been compared on the basis of 4 P’s of marketing which are Price, Product, Place and Promotion. These two brands which are been compared are British airways and Iberia.
- Price: Price is one of the most important elements to be considered when the strategies are to be made. Where on one hand British airways keep the prices of its services from low to high according to the package selected by the customers, Iberia also has different lines of services which are Iberia express for low carrier services and Iberia for premium customers for which the prices are set high. The prices of both the Airlines are set according to the value added services provided by the company to the customers (CAPA, 2016)
- Product: The products of British Airways are the services which are provided to approximately thousand destinations across the globe. They also provide their merchandise in the form of caps, t-shirts, mugs, pens, etc. to the customers. Iberia on the other hand provides around 600 flights daily to the customers in 57 countries.
Merchandise by British Airways
- Promotion: British Airways promotes its products by providing special discounts and offers on the social occasions like Christmas and Good Friday. Also, the regular customers are provided with the special discounts. They advertise in the magazines, television and online for building awareness among the customers whereas Iberia promotes its services online and on social media. It launched its official website and mobile application which can be used by the customers for better experience of ease while booking flights (News, 2015)
- Place: Iberia flies everyday to around 120 destinations with a fleet of 135 aircraft. It has contracts with the airports of different destinations for providing services with more coverage whereas British Airways have greater coverage than Iberia covering almost 1000 destinations.
3.3 Justify strategies for how selected International Airlines businesses could respond to change. Your strategies in 3.2 needs to be clearly justified with supporting arguments
The above strategies are very helpful for making and developing the strategies for both the brands for their success and growth. From the product mix of the brands, the customers can get attracted to the products offered by these companies and reasonable pricing of these products manage the profits of these brands and also Financial Resources. Promotions are essential for every company in today’s competitive environment. These companies adopt the promotional strategy which is cost effective and comes within their budget and are effective for their targeted market. The place strategies are made by keeping in mind the accessibility of the place and location benefits and availability of customers. So the strategies mentioned above with the help of four P’s of marketing are beneficial and respond to the change (Council, 2015)
In the given case, Myla Travel UK is given which is a travel company with 10 offices in UK and the case says that Thomas Cook wants to acquire the same for better business operations and Myla travels also wants to expand its operations but all the directors of Myla travel are not in consent. One of the directors says that they should join The Travel Network Group which is a consortium of different travel companies in UK. So, there are different opinions on this by all the directors. I have to present a management report on the direction of line manager. The report has been prepared for the directors of Myla Travels.
4.1 Analyse the impacts of issues and trends that drive change in the travel and tourism sector with reference to Myla Travel, Thomas Cook and The Travel Network Group.
The following sector structures are discussed below to explain their impact on the business, on the products and services and on the employment levels. The impact can be positive as well as negative
- Impact on business: the travel companies cannot be stagnant. I fact all the companies need growth to increase their operations and profits. Here, Myla Travels have to expand its business which can be done through Merger, acquisition or joining a group of several travel companies to get the support in the functions of the company. Myla travels will get improved revenues and profits when it will join The Travel Network Group as it will get the benefits and support of the big group being a part of it (Holden, 2008). If Myla travels will get acquired by Thomas Cook, it will get the brand name and expertise of an established brand like Thomas Cook. The company will get capabilities and technological abilities of a brand of Thomas Cook. By joining the The Travel Network Group, Myla travel will get access to broader markets but conflicts can occur between different members of a group. The groups either help the companies to grow at a very high arte or they bring downfall to them completely. The success of Myla Travel Company will get dependent on the success of the group practices and methods but the Thomas cook acquisition will finish the identity of Myla Travel agency (Holden, 2008).
- Impact on products or services: By joining the group of consortium The Travel Network Group, the products and services of the company can be designed in a better way and the costs will be reduced while when the company will join a big brand like Thomas Cook, the products and services will be made out of better technology and based on customization which will be done on the basis of customer’s demands and needs.
- Impact on employment levels: if Myla travels will join Thomas Cook, there is a risk of job loss by many employees and the business practices will also change. The case study says that Thomas Cook is planning to cut down the one in every six jobs and closing its 195 stores in Britain. This also creates a threat to the workforce of Myla travel. While joining The Travel Network Group will pose no threat to the employees of Myla travels (Conrady & Springer, 2012)
4.2 Discuss the likely consequences of businesses failing to respond to market change with reference to Myla Travel, Thomas Cook and The Travel Network Group.
The above mentioned impacts show that how Myla ravel will respond to the various changes in business. The below points will suggest what will be the consequences of businesses failing to respond to market change:
- Reduced sales: Business is no easy and is a complex process where the attention is to be given to the changes occurring in the market. If the business will not follow the changes and will not respond to them, it will definitely face the problem of reduction in sales. Myla travel company have to concentrate on the required changes which have to be applied in the business with the change in the environment otherwise, the sales in the business of Myla travel company will reduce (Conrady & Springer, 2012).
- Reduced profitability: the reduced sales due to the failure in responding t the changes of environment will bring reduced profitability for the business. The unsatisfied customers will not purchase products and services from the company and it will reduce the profit margins for the Myla Travel Company.
- Change in the attitudes of customers, suppliers and competitors: The falling profit margins and increase in the no. of dissatisfied customers will change the attitude of customers. They will prefer to go for some other business or travel company which can provide better products and services with upgraded technology or the services which are updated with the changes in the environment of the business. The suppliers will also become uninterested due to the ineffectiveness of the business of Myla travel company and the competitors will continue to grow and will move far ahead of the company (Conrady & Springer, 2012)
- Negative impact on the products and services: The reduction in sales and profits will lead to the negative image of the brand in the market. It will also have negative impact on the products and services of the company. The brand will not be able to generate funds due to the lack of interested investors.
These impacts and consequences clearly shows that Myla travels should either join the The Travel Network Group or can get acquired by Thomas Cook for better business operations and to save the business from downfall (Hall, 2008).
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It can be concluded from the report that there are several current issues which are affecting the Travel and Tourism industry of the world. These issues can be globalization, terrorism, internet or any other issue which positively or negatively affects the tourism of nation. It can be said that niche tourism can prove to be the sectors of tourism which itself are successful in attracting tourists for the country and are responsible for the growth of country’s tourism like heritage tourism of UK itself contributes 2% of the GDP of the country. The business strategies have been developed with the help of Price, Product, Promotion and Place for International Airlines Group and in the last task, the case study of Myla Travel company has been discussed and different impacts of the changes failure to environment changes has been discussed. It can be concluded that Myla travel office should respond positively to the changes and should join either the The Travel Network Group or Thomas Cook for expanding its business operations.
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