Chapter 5 Tourism product and tourism industry

Teaching purposes

 list the major types of natural and cultural tourist attractions  appreciate the diverse array of these attractions

 discuss the management implications that are associated with the various types of attractions

 describe the various attraction attributes that can be assessed in order to make informed management and planning decisions

 understand the basic characteristics of the tourism industry’s main sectors

 appreciate the growing diversification and specialization of products provided by the tourism industry

 discuss the concepts of integration and globalization as they pertain to the tourism industry

 identify and account for the circumstances under which a destination is more likely to experience negative rather than positive economic impacts from tourism

 appreciate the negative consequences of revenue leakages for a destination

Time allocation

Tourism Products Chapter 5 The tourism Tourist attraction product and tourism industry (8 periods) Tourism industry Industry structure 2 periods 3 periods 2 periods 1 periods Teaching procedure

5.1 Introduction

(1)The definition of tourism product

(2)The characteristics of tourism product:

 Service  Intangibility  Perishability  Inseparability

The Characteristics of the Tourism Product

5.1.1 Intangibility

The service product is intangible when it cannot be easily evaluated or demonstrated in advance of its purchase. For example, a travel agent cannot provide for the testing or sampling of the tourism product. On the other hand, an automobile or computer game can be tested prior to purchase, and clothing can be tried on. Much of the selling of tourism and hospitality is related to the promise of safe and timely delivery of the purchaser of the service.

The problem may be overcome by printing a wide range of literature, by producing videos or by providing the product on a special offer in an attempt to increase tangibility. In addition, there is a need to ensure that marketing provides sufficient publicity for name-recognition of well-managed organizations providing accommodation, transportation and distribution. This positions the brand name more tangibly in the mind of the consumer.

5.1.2 Perishability

Perishability means that service products such as tourism, unlike goods, cannot be stored for sale on a future occasion. For example, a hotel bed or an airline seat unsold, or a convention centre left empty, is revenue that can never be recouped. This illustrates the high-risk nature of the tourism industry. Marketers in the tourism and hospitality sector have to devise complex pricing and promotion policies in an attempt to sell ‘off-season’ periods.

The reaction to perishability is for marketers to try to smooth out demand curves by careful use of the marketing mix - for example, cheaper tickets for matinee shows. There is also a concentration on the use of computerized reservation systems in order to forecast the need for tactical action if demand is believed to be below expected levels.

5.1.3 Inseparability

Tourism products are often referred to as being inseparable which means the product is often consumed and produced simultaneously. Because there is less opportunity to pre-check a tourism or hospitality product, it can vary in the quality of its service delivery. Greater variance occurs when the customer is part of the production system. The simultaneous process of production and consumption can lead to situations where it is difficult to ensure the overall satisfaction of consumers.

For example, there is the potential problem of having incompatible clients with conflicting needs which may result in friction. Whether on an aircraft, in a hotel or in a restaurant there could be a clash of social values, excessive noise, drunkenness, high spiritedness or a child crying. Staff may have personal problems, be feeling ill or tired, and this can affect their level of commitment to their performance of providing good service or resolving problems.

5.2 Risks of the Tourism Products

5.2.1 Economic risk

Economic risk, whether the product offer is of sufficiently good value, is associated with each decision made by potential tourists. All consumers face economic or financial risk when they purchase tourism products which they are not sure will deliver the desired benefits. Tourism involves the purchase of an expensive product that cannot easily be seen or sampled prior to consumption. This type of risk is heightened for those with low levels of disposable income, for

whom the purchase represents a major expenditure.

5.2.2 Physical risk

Some overseas destinations may be perceived to be dangerous owing to disease or crime; some transport companies such as ferries or airlines are thought to be safer than others. Some people fear flying no matter what airline they take, while others reduce their perception of physical risks by selecting certain ‘safer’ airlines.

5.2.3 Performance risk

The quality of different destinations or unknown hotels cannot be assessed in advance. This type of risk comes from the apprehension that the product may not deliver the desired benefits. It is rarely possible for those who have had a bad holiday to make up for it by attempting to have another better holiday in the same year. Most consumers do not have the additional money or holiday entitlement to make good the holiday that went wrong. This heightens their awareness of the risk factors involved.

5.2.4 Psychological risk

Status can be lost through visiting the wrong country or traveling with a company that has a poor image. This risk occurs when the potential customer feels the purchase may not reflect the self-image he or she wishes to portray. The various risks of the tourism products have to be minimized through product and promotion strategies. By acquiring information the consumer builds up mental pictures and attitudes that create the expectation of positive benefits from the travel and destination experience.

5.3 tourist attraction

(1)The classification of tourist attractions Categories of tourist attraction:

 Cultural site  Cultural even  Natural site  Natural event

5.3.1 Natural sites

 Topography( Mountains, Beaches, )  Climate

 Water( Lake, Sea, Waterfall, Spring, River, Snow and so on)  Wildlife( Captive and non-captive )  Vegetation

 Protected natural areas  Location

Topography

Features of mountain

1. Mixture of the natural and cultural attractions

2. Fragile nature

Question: Are all the mountains tourist resources?

Not of them belong to tourist resources. And they should be accessible and otherwise they are potential tourist resources.

Example: Jiuzhaigou Valley is inaccessible in 1970s. At that time it can not be regarded as the tourist resource, only the potential tourist resource.

Climate

Question: How dose the climate influence the tourist flow?

 Hot-to-cool flow  Cool-to-hot flow  Cool-to-cool flow

Location

Question: Why do you think the location is an attraction? Give example.

Extreme or centralize locations are an aspect of the physical environment that fascinates many tourists, and as a result they may have the potential to be exploited as tourist attractions. For example, the town of Rugby, Land’s End, the Byron Bay and so on.

Question about Figure 5.3

Why do so many tourists travel in Australia?

Analysis: A comparative study of inbound tourists in Australia and China. Five elements of tourism attractions:

 Quantity  Quality  Diversity  Uniqueness  Accessibility

5.3.2 Natural events

 Bird immigration  Tides

 Volcanic eruption  Solar eclipses  Comets

5.3.3 Cultural sites

 Pre-history

 History( Mountains, Battlefields, Heritage districts, Museums)  Contemporary( Ethnic neighborhoods)  Economic activity( Wineries, Canals)

 Specialised recreational attractions( SRAs )( Golf courses, Theme parks, Casinos and so

on)

 Retail( Mega-malls, Market and bazaars)

Case study (P144) Managing the wine tourism industry - Australia

Refer to Figure 5.3

1. A Survey of the wine tourism in Australia, especially in the south Australia.

2. Organization of the wine tourism, private collected. (a comparative study ). They improve the development of wine industry.

3. How to solve monotony (单调性) of wine industry?

One may increase the diversity of the wine tourism. Make a comparative study of Five-flower farm tourism in Chengdu. 4. Competition and cooperation

Question: What is the difference between the wine industry and wine tourism?

5.3.4 Culture events

(1) small and large

(2) Size: Regular and irregular

(3) Single destination and multiple destination (4) Classification Cultural events:

 Historical re-enactments and commemorations  Sporting events  World fairs  Festival

Questions:

Why do the tour operator stage cultural events?

 complementary part  promotion

 overcoming seasonality

5.3.5 Attraction attributes

public ← ownership → private non-profit ← Orientation→ profit Nodal ←Spatial configuration → Area genuine ←authenticity → limitation unique ←Scarcity( international, national, regional) → ubiquitous primary ←status → secondary low ←Carrying capacity → high

accessible ←Spatial, temporal, financial, price→ almost inaccessible Niche ← market → Inclusive all tourist ←→ most residential unfamiliar ← Image (tourist or resident → familiar

negative ←→ positive

Questions: Do you think the more genuine and the better?

Carrying capacity:

1. Environmental capacity, 2. Cultural capacity, 3. Psychological capacity

Questions: How can we reduce the carrying capacity of the destination? Back stage: 一般不对游客开放，保护文化 Front stage: 舞台式的表演，一般不真实

5.4 The Tourism Industry

As we known, the tourism industry includes the business that provide goods and services wholly or mainly for tourist consumption.( page154)

Tourism includes:旅游主体tourist, 旅游客体attraction, 旅游中介intermediaries. The intermediaries includes: travel agency, transportation, accommodation, food and beverage outlet, merchandise and so on.

5.4.1 Travel agency

Travel agencies, primary function is to provide retail travel services to customers for commission on behalf of various tourism industry principals: itinerary, accommodation, insurance, exchange of money, commission, reservation.

Question: What’s the difference between tour operator and travel agency? Tour operator is wholesaler while travel agency is retail seller.

5.4.2 Transportation

There are four kinds transportation mainly (air, railway, water, and road). Air

The advantages: Speed is quick (especially for long distance travel), safety.

The disadvantages: uncomfortable, can’t see the landscape, customers are limited

Case study: Airline alliances

The advantages of airline alliances:

 expanding available route networks  facilitating transfers between airlines

 providing for greater reciprocity infrequent flier programs and lounge sharing  integrating an array of redundant employee training programs The disadvantages:

 more expanding  higher load factor

Road

The advantages: flexibility, the landscape, privacy The disadvantages: expensive, unsafely Railway

The advantages: cheap, loading, safe, the landscape, comfortable The disadvantages: slow speed Water

The advantages: comfortable, cheap, landscape The disadvantages: slow, inaccessibility

5.4.3 Accommodation---A kind of the lodging industry

Hotel and apartments Kinds of hotel:

 convention hotel  airport hotel  resort hotel  apartment hotel  motel

 commercial hotel  heritage hotel  young hotel

Case study Timeshare’,s coming of age

Timesharing, or interval ownership, is a relatively new form of accommodation where the client purchases one or more weeks, or intervals of time within a resort over a given period if years.

Advantages:

 save money for the customers

 more chances to travel in different parts of the word  more profits for the operator  high-level product satisfaction  brand loyalty  ripple effect

5.4.4 Food and beverage outlets

Comments: How do you understand eating food is just eating culture?

5.4.5 Tour operator: package tourist

The major role of tour operator is to provide a package of services for the consumer, including accommodation, transportation, restaurants, attraction visits, guiding services and so on.

5.4.6 Merchandise

Typical origin merchandise includes camping equipment, cameras and film, hug gage and travel publication (page 163)

5.4.7 Industry structure

The features of tourism industry structure in China:  small size  week

 low efficiency

Horizontal integration occurs when firms attain a higher level of consolidation or control within their own sector; vertical integration occurs when a firm obtains greater control over elements of the product chain outside its own sector.

Figure 5.5Horizontal and vertical integrationVERNCAL BACKWARD INTEGRATIONGain control over company that manufacturesHORIZONTAL INTEGRATIONEstablish adventure tourism tour operator subsidiaryTour operatorHORIZONTAL INTEGRATIONAcquire controlling interest in another tour operatorGain control over chain of travel agentsVERTICAL FORWARD INTEGRATION

CASE STUDY

Gold Coast Theme Parks

The Gold Coast is aptly known as the theme park capital of Australia. Its four major facilities attracted 3.7 million visitors in 1997. If combined into a single product, these sites would constitute the sixth most visited attraction in the country. Three of these theme parks (Sea World, Movie word and Wet n’ Wild) are controlled by the partnership of Village Road show and Time-Warner, which jointly own the management and operations companies that run the parks. Time-Warner is the largest media corporation in the world, and one of the most globalize. Village Road show is Australia’s largest entertainment and leisure company, and one of the fastest growing of all Australian corporations. Village is also extensively global in structure, having formed lucrative partnerships with Time-Warner (United States) and Golden Harvest

Communications (Hong Kong), as well as other high profile Australian media and communications enterprises such as Kerry Packer’s PBL (Publish & Broadcasting Limited) and Westfield Holdings.

The involvement of village in the three Gold Coast parks, and in its plans to build an additional $600-millon theme park somewhere in Asia, are indications of extensive horizontal integration. Vertical integration is apparent in its plans to expand its radio division into India and South Africa, and in the fact that the partnership owns one-half of the company that operates Sea World Nara Resort Hotel, which is adjacent to Sea World. Intriguingly, Village’s rationale for entering the theme park business in the early 1990s was to reduce the impact of potential downturns in its movie component. Despite their very high profile as Australian tourism attractions, however, the theme parks actually account for only a very small portion of Village and Time-Warner’s overall corporate activity (Shoe Bridge 1996).

The globalize corporate structure of the three theme parks is reflected in all aspects of their operations. For example, some 40 per cent of all visitors are inbound tourists, with Asian markets being dominant. The theme parks are heavily marketed within the major Asian source countries and have become an integral component of the most popular all-inclusive Gold Coast package tours that are offered to these markets. The seemingly endless numbers of large coaches that arrive at the parks to drop off and pick up tour groups are therefore just one element of very highly developed and highly controlled mass tourism systems that involve a complicated array of interrelated components of the global tourism industry. It is notable that the three theme parks have distinctly different themes, so that they do not directly compete with one another, but rather complement each other as a coherent package of theme park attractions.

Equally sophisticated internal systems of planning and management are evident once the visitor enters the theme park precincts, giving rise to a number of interesting paradoxes that are typical of theme park environments. First, the adventure rides, which are far and away the most publicized sub attractions of the theme park package, are presented as thrilling experiences that entail some degree of risk and danger. This is evident in the names, such as the Tower of Terror’ (Dream world ) and ‘Wipeout’ (Movie world), and in the signs that warn of the potential risks to those with certain health conditions. However, theme parks are in reality among the safest and most sanitized of tourism environments, with discrete but alert security and sanitation personnel constantly scanning the site for signs of trouble. Such vigilance, based on the Disney prototype, is maintained so that visitors are not distracted or put off by the sight of garbage or unruly patrons, and to avoid any potential liability for injury due to unsafe rides or infrastructure. This tendency towards security vigilance, crowd control and strict regulation of activity is the second paradox, in that theme park experiences are also commonly portrayed as places where people can wander at will and have total ‘freedom’ (Sims 1995).

The third paradox is the contrast between the emphasis on spontaneity, fantasy and escapism on the one hand (e.g. adults are invited to be children for the day), and the highly orchestrated and choreographed nature of the actual theme park experience on

the other hand. Streetscape design and a rigid schedule of performance, ‘spontaneous’ and otherwise, are designed to channel visitors from one area to another in a way that optimizes visitor distribution and their willingness to spend. In fact, the high profile adventure rides account for only a small proportion of visitor activity time or occupied theme park space. Made available for free as part of a one-price admission fee, they are actually provided as lures to keep the visitors within the park for as long as possible. While thereby being able to take advantage of all the ‘free’ rides, they will also be more likely to make additional expenditures on food, drink and souvenir items during an all-day excursion. This contention is supported by the fact that strategically located retail shops, restaurants, food outlets and theatres far outnumber the rides, providing a virtually self-contained arena for almost unlimited retail consumption. As for the tides themselves, new and presumably more adventurous options are introduced every two years or so, to encourage repeat visitation.

The final paradox is the marketing of the theme parks as ‘unique’ experiences, even though similar if not identical facilities exist in many other locations as part of globalize corporate product networks. Token efforts are made to provide at least some Australian iconic elements (e.g. koalas and outback-type characters) in all three Gold Coast parks. However, the overall impression is one of blamelessness, where the visitor is confronted by a mishmash of facades representing a broad array of out-of-context cultural stereotypes that could just as easily be located in Orlando or Sydney as on the Gold Coast. In sum, theme parks are perhaps the epitome of a highly manipulated and meticulously managed corporate-controlled attraction that leaves nothing to chance, and represents the increasingly globalize character of tourism systems.

Questions

1 How do the three Gold Coast theme parks illustrate the concepts of integration and globalization?

2(a) Why is the theme park experience described as a series of paradoxes?

(b) To what extents are theme park users aware of these apparent contradictions? (c) Would they be ‘turned off from going to theme parks’ if they were aware of these manipulations?

3 (a) Obtain as much promotional information as you can about any of the three Gold Coast theme parks managed by Village Road show.

(b) What techniques are used to attract visitors to these attractions? (c) How do these techniques reflect the paradoxes described above?