Introduction to Contemporary Issue In Travel And Tourism
The term “travel and tourism” gives an image of spending leisure time at a particular place. But today, it has emerged as a major industry for economies. A nation can reap many advantages from this industry (Travel and tourism, 2016). It brings social, cultural and economic benefits at the national, state and local level. This sector has become an outstanding source for revenue generation and foreign exchange earnings in the country. Changing trends and developing resources have broaden the concept of tourism. It is not only related to the purpose of entertainment and leisure but it has also expanded its branches in the sector of education, business benefits, curing health issues, adventurous trips as well as cultural heritage.
1.1 Issues currently driving changes in the travel and tourism sector
Tourism has enormously become an important sector for the UK's economy.London is a principal tourist destination and attracts many tourists every day. Presence of various current issues is driving changes in the travel and tourism sector of UK. These issues and changes are as follows:
Need for security measures: From tourists arrival till their departure, effective safety and security measures are taken by UK government. Immense amount of illegal and criminal activities has enforced government to take stringent measures to protect this industry.Negative impact of terrorist attacks has influenced not only the tourism industry but other businesses too like airlines, hospitality industry and other allied services (Dwivedi, Yadav and Patel, 2009).
Advancement of technology: Digitization and technological enhancement have driven many changes in tourism sector of UK. Effective use of internet through blogs, online advertising, social media has enhanced the revenue of economy. Airlines and hospitality industry provide various facilities to its tourists. Improvised reservation and booking facilities provide smooth functioning of the transportation system. Social networking sites have promoted and advertised many tourist destinations of the country.
Rise and fall of inflation: During inflation, there is rise in the price of commodities and services causing fall in purchasing power of the people. UK's tourism sector also got influenced by the rise and fall of inflation many times. As the prices of commodities rise, the is downfall in the number of tourist visits in the country.While, on the other hand, fall in the rate of inflation attracts large amount of tourists in the country.
Time to delivery: Delivery of services on time has become key feature of travel and tourism sector. Booking of tickets, on board services and visit to the destinations are planned and implied by keeping in mind the time limits. It is very well known to them that time is a wrathful factor for their clients (Agrawal, Choudhary and Tripathi, 2010).
1.2 Using appropriate methods and resources for current changes in travel and tourism
Travel and tourism is affected by various changing trends and issues. Here, two business entities Holiday Inn and Easy Jet are considered as the examples. Holiday Inn a multinational brand of hotels while, Easy Jet is a British low-cost airline carrier. Various methods and measures adopted by them are explained to cope up with current changing trends.
Safety and security threats are always present in the country. Terrorism and natural hazards are sincerely handled by both the entities. Easy Jet makes the use of high security CCTV cameras and related equipment in order to monitor its passengers and staff activities. It ensures that illegal activities should be identified and investigated at quick pace. While, Holiday Inn takes measures to protect its clients and tourists from natural hazards like earthquake or tsunamis. Hotel group appoints security officers to centralize all the issues related to the safety and security of its visitors (Stone, 2013).
Every year, many prominent changes take place in science and technology. Both the companies make efforts to adopt technological advancements in their working culture. Holiday inn makes the use of internet and social media facilities to promote its schemes and attract more tourists. Reservation and booking facilities have become more convenient and time-saving. . Introduction of new enhanced air crafts offering fast comfortable flights. This measure is fruitful for airline to attract more number of clients.
It is well-known that inflation has crucial impact on oil-gas based industries.This also enhances the price of air tickets. Due to this, airlines face threats of competition as well as substitution against the other means of transportation. Airline management prepares strategies to stabilize its clients or passenger. Whereas, Holiday inn provides offers and special discounts to the visitors to stay with them during inflation period. Managers make adjustments like reduction in training cost of hotel staff in order to proportionate the loss of discounting price. Through these measures, both the companies can match up with the growing trends and changes.
2.1 The current trends influencing change in the travel and tourism
Following are the types of tourism which are getting influenced from the factors of current trends of tourism in the UK. These are as follows:
Domestic tourism – Over the past years, UK population has shown a diverse rate of rise by 7.2 % (from 2000-10), eventually this results a similar rise in domestic travellers in the country. It involves the visiting of beach or museum,sightseeing by car or on foot etc. It is mainly influenced by the political and economic factors which can be like for every 1% rise in the cost of visiting UK. UK's tourism earnings falls by 1.5% while taxation rate as per the current policy of UK now ranks 134th out of 140 countries.
Inbound tourism –This trend of tourism in which the travellers or residents of another country visiting and staying in some other country for limited period of time.It concludes that big scale of 33.4 million visitors travel to the Country which eventually rises the market earning with $22.8 billion that is an average of $646 per person. This number of visitors to Britain has increased by 6% since 2013 and earnings of the market by 2.5%.
Grey tourism –Rise in this tourism in UK is set to be continue more senior citizens are visiting from abroad (Grey tourism, 2016). As per the report, almost one in every five of the tourists in UK was over 55 years old. Further, it shows an increase of 3.3 million visitors to Britain by 2014, with France staying at the top priority.
Medical tourism – According to the researches, medical tourism has a lucrative source of income for the Hospitals and the country. Medical tourists spent lot of money on hotels, restaurants, shopping and transport in the country which sum up to $54 million earnings in 2011 (Jauhari, 2009). In the UK, there are 19 such hospitals those are likely demanded by the medical tourist. However, more residents have leaved UK for seeking better medical treatment in abroad as about 62,000 people from the country have travelled to abroad for medical care.
2.2 Analysing the current trend by using appropriate techniques and resources for UK
The British tourism organisation said that sports tourism trend in the country has led a diverse effect on each factor like economical,political, social and technological. However, England sports tourism industry worth for $3.2 billion and welcomes four million overseas visitors each year. Each sporting visitor contributes up to $1200 per trip, which is almost two times of the “ average visitor's spending while travelling to Britain. Britain attracts substantial numbers of visitors from abroad by various ways like Premier league, Ryder Cup, Wimbledon,etc. Last year, the country has welcomed foreign sports fans after its reported boost of 8,000,000 football tourists (George and Henthorne, 2007). The heavy popularity of the listed stadiums helps in maintaining the interest of the sports fans to the country, they be like Wembley stadium, Anfield,the Emirates stadium, Stamford Bridge, Goodison Park were in the top choice of the tourists. Some 2,000,000 of the foreign tourists attended the football matches in the period of January and March,which were mostly from Ireland, Germany, Norway and US. After football, next most likely sports were Golf and Rugby which draws attention of spectators from US,Irish and France. Cricket contributes most of the overseas fans from Australia.
London 2012 Olympic Games has high lightened the Britain's Profile and stated it with a 'Nation brand' for sports and tourism. Olympic draws attention of billions of viewers from TV over a week period in more than 200 countries in the world and make Britain the centre of attraction.
3.1 Analysis of responsive change in tourism business
To assess the market to know the change in tourism sector in Britain, the best option for this would be PEST analysis (Graham, Papatheodorou and Forsyth, 2010). As it helps in finding the factors which affects the tourism sector which could be furthermore change to get better response. All of the factors have clear implication over Business travel and tourism of Easyjet,and accordingly, the report has been represented:
Political Factors – this findings clarify the stability of UK's political environment in the country. But, the result of rising awareness of the environment,UK government is controlling the aviation department for its environment impacts. Implications of taxation over the aviation fuel and rising the Vat on the air tickets has affected the tourism sector in the country. For the change, Easyjet should take actions like low rates of tickets for some instance to attract the tourist, introduce couple package tickets at cheaper rates, lowing down the facilities provided to cover up the impact of rising VAT,etc.
Economical – the main element which affects the tourist and the visitors to the country is unstable exchange rates and high inflation rates (Hall, 2008). But the factor like fluctuations in oil prices impacts directly to the Easyjet profitability which further gave a rise in ticket rates. To overcome this situation, airline company should maintain the price list of the ticket for some time period in order to maintain the tourist interest to their company, it may affect the company's profitability but not diverse sense.
Social – it includes the factors like rising awareness for healthy travelling, avoiding long travels, demographic changes,etc. Affects the tourist interest from visiting outside countries which further reduces the rate of travelling through flights. To balance the situation, Easyjet should promote the special packages for business travellers,moreover, it should explore the world with places where regular flights could result a great boom. Also, the grey tourism is rising in UK in this regard, company should launch special package for the travellers more then 40 years of age.
Technology – although Easyjet has immense number of technical staffs which controls and monitors the whole networks of the company. But still it lacks communication with the travellers . To avoid this, Easyjet should explore itself on internet and adjoins with the travel agent which helps in convincing more clients. Also,by adopting advance and improved technology reduces the fuel cost and increases lifetime to the aircraft engines (Fyall and Morgan, 2009).
3.2Developing Strategies on travel and tourism businesses which could respond to change
The report further specifies the strategies needed to overcome the factors affecting the tourism business of Easyjet which could be changed for better response. Strategies are to be set in the manner which is adjustable to the company and could be driven to its estimated end. As per the factors affecting the travellers to travel in abroad via air transport is mainly the high price of the air tickets which demotivate their mind to visit the country. To control the price list of the air tickets, the companies has to plan the strategies accordingly, which could maintain a level between number of travellers via air and rate of profits to the company. Moreover, strategies could be like :
Special package : introduction to special packages for regular clients, business travellers, honeymoon travellers, group travellers,etc. Off season offer could be introduce to attract more clients. Travellers with the age of more than 50 years should get discount in fare. Sports concession in the flight rates to the group of travellers visiting the country to watch the match (Dale and Oliver, 2005).
Stability in Flight charges : Easyjet should have a control over the fluctuation over the flight rate during inflation. It should rise the price of the ticket during inflation period in the country.
Advance technology : adapting advance aircraft during rise in fuel charges. Upgrading the technology of buying tickets and easy paying over internet.
3.3 Justifying Strategies on travel and tourism businesses which could respond to change
Special package : Grey tourism and sports tourism are the main trend of tourism,by introducing the special packages, company would attract the travellers with the motive to travel for sports matches and the old-age travelers. During off season, their are less travelers from abroad, hence to cover up the cost of flight company has to focus over business travellers. Providing better deal in business class fare would attract the clients looking going on business trip ( Petrova and Mason, 2004).
Advancing the technology : it would help by reducing the consumption of fuel in the aircraft and adds more years to the aircraft's life. Advanced aircraft provide better comfort to the traveller while travelling on long distances. Attracts more clients over internet while purchasing the tickets,it also gives them brief description about the flight.
Stability in Fare : rising fare during the inflation period would rise the rate of profitability for the company. As the purchasing power of the foreign visitors would high during inflation hence they could afford high rate of tickets too. Stability in fare also maintains the interest of regular clients (George and Henthorne, 2007).
4.1 The impact of issues and trends that drive change in the travel and tourism sector
The current trends such as medical tourism or destination tourism has laid great impact in the tourism sector. Other industries interconnected with tourism sector also get affected by the current changes. Easy Jet, British airline carrier faced many changes and improvement in the current scenario which can be understood below:
Impact on sector structure: Easy Jet has expanded greatly since its establishment through mergers, acquisitions, liquidations and formation of consortia. It has purchased several rival airlines including GB Airways with the course of time. Several acquisitions made by airline group increased the growth prospects of travel and aviation sectors. Adoption of prominent technological changes provided much expansion compared to the past accounts (Mazurski, 2000).
Impact on businesses: The company witnessed expansion with the changing trends through combination of acquisition and low-cost air-travel to its passengers. This rapid expansion of the company increased its market share and position. Customer satisfaction helped the business to built strong goodwill in the market (Fyall, A. and Morgan, 2009). It established the concept of point to point model which influenced its rivalries. According to this model, the visitors were dropped to the pin point places and they don't need to change the aircraft to reach the major airport. Another practice which attracted the passengers was there were no incentive for travel agents as the bookings were done by telephone only. This reduced cost burden on the passengers and made them to choose Easy Jet as better option for air-travel.
Impact on employment levels: Aviation sector provides a wide range of employment opportunities to the mass of country. Apart from airline services, EasyJet launched co-branded EasyJet Hotels accommodation booking services. It offers accommodation products throughout the EasyJet network which requires good amount of workforce. It also publishes an in-flight magazine containing articles of customer interest and destination guides (Jones and Phillips. 2009). These new ventures demand for more recruitment and more employees. Thus, these trends and changes provide guideline and growth to the company.
4.2 The consequences of businesses failing to respond to market changes
It is essential for EasyJet to respond the market changes in timely manner. If the company doesn't judge, monitor and implement policies favourable as per market trends. It losses faith among its customers and stakeholders. There are various consequences of business fall in lack of response to the market changes. The first consequence of business fall is reduction in its profit margins or profitability. When the company is not able to achieve the set benchmarks according to recent trends the sales reducing. The demand for airline services will be reduce in the market. This will shrink and contract the profit margins of the company. It will not be able to meet up the cost occurred for providing its airline services. Reduction in sales of the company will ultimately reduce its profitability (Law, Leung and Wong, 2004).
The business fall of the airline company will have adverse impact on the attitude of its customers, suppliers and competitors. These are the stakeholders of the company having direct interaction and contribution in the working of the airline. The suppliers like fuel and oil manufacturing companies expect credit worthiness from the company along with continuous demand of their raw materials. Business fall will change their attitude and reduce their priorities for the company. The customers are the end-users of the airlines product and services. The fall will divert them to the other substitutes or even make them opt the rivalries of the company. During the depression period of company, its competitors will be benefited the utmost. They will make strategies to pull and grab the existing customers with the new ones of EasyJet. Thus resulting in unfavorable change of the attitude in its stakeholders.
Lastly, when the company will not be able to match the current demands it will highlight negative impact on image of its products and services. The clients of EasyJet will find loopholes and demerits in its existing products that were once of best quality. All the above consequences will negatively impact the working of company (Maitland and Ritchie, 2009).
From the above report the current issues and trends in the travel and tourism sector can be studied. The report analyses different issues driving change in the travel and tourism sector and their measures and methods adopted. It analyse how the travel and tourism sector respond to such changes. The justification and development of strategies in response to the changing trends and situations in context of EasyJet. Later, it describes the impact of issues and trends over the travel and tourism sector. The impact of such changes over a business and its products and services. The report concludes by presenting the likely consequences of business fall on various factors of the enterprise.
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