E-Tourism Nicos Rodosthenous PhD 28/03/ /3/20131Dr Nicos Rodosthenous

Supply-driven E-Tourism 1.Introduction  The purpose of this chapter is to explore the strategic implications of ICTs in the tourism industry.  Demonstrates how organizations use eTourism to achieve and sustain competitive advantage and illustrates several critical strategic decisions. 28/3/20132Dr Nicos Rodosthenous

Supply-driven E-Tourism 2. eTourism today:  ICTs provide a powerful tool which bring advantages in promoting and strengthening tourism industry operations (WTO, 2001)  Tourism industry uses a wide range of ICTs systems for management and marketing of global organizations and for inventory control and administration purposes.  Internet provides a window to the world by demonstrating their competencies widely. 28/3/20133Dr Nicos Rodosthenous

Supply-driven E-Tourism  Intranets and extranets offer user-friendly access to employees of organizations and to authorized partners in order to use company data and perform their tasks.  Example, is the airline alliances which today dominate the entire globe.  eMarketplace with vast majority of tourism providers developed Internet interfaces to communicate directly and efficiently with their clientele and partners. 28/3/20134Dr Nicos Rodosthenous

Supply-driven E-Tourism 28/3/20135Dr Nicos Rodosthenous

Supply-driven E-Tourism 3. Monitoring the environment and dynamic response: proactive management and neural organizations  Enable organizations to integrate all their systems and monitor both their internal processes and external trends.  Take advantage to recognize and capture data coming from both the external and internal environment of organizations and assist decision making with the appropriate responses. 28/3/20136Dr Nicos Rodosthenous

Supply-driven E-Tourism Example, a hotel can monitor its reservations and take appropriate action based on guest histories, data from previous years and forecasted demand. Hotel management can also monitor prices and offerings of competitors. Proactive schedule of events, activities and products can therefore be planned and executed accordingly. (demand-pricing policy) 28/3/20137Dr Nicos Rodosthenous

Supply-driven E-Tourism  Neural organizations constantly monitor and control external and internal environment, identify patterns, trends and developments and take proactive measures to advance their interests.  Enable organizations to manage their resources efficiently and to interact with their consumers and external partners proactively and reactively in order to improve their competitiveness. 28/3/20138Dr Nicos Rodosthenous

Supply-driven E-Tourism  Providing the right solution at the right time, will be one of the most significant generators of competitive advantage. (Case study 1, delay of a flight)  The strategic benefit emerges from the development of the neural network and the constant update of the system.  They can redesign and repackage tourism products instantly, according to consumer desires and trends. 28/3/20139Dr Nicos Rodosthenous

Supply-driven E-Tourism 4. Building and maintaining competitive advantage using ICTs  ICTs enable organizations to differentiate their products or reduce their costs and therefore their prices and assist them to achieve competitive advantage and strategic implications.  CRM (customer relationship management) develops interaction with consumers and customize their products. 28/3/201310Dr Nicos Rodosthenous

Supply-driven E-Tourism  Reducing cost is often a result of great efficiency.  ICTs assist the distribution process by reducing the commission levels and the reservation administration cost, through outsourcing Competitive advantage through pricing and cost.  Large hotels with more than 250 rooms, airlines with more than a few aircraft and tour operators with more than few thousand passengers would be impossible to run without ICTs. 28/3/201311Dr Nicos Rodosthenous

Supply-driven E-Tourism  ICTs enable last-minute deals/sales and auctions.  Web presence and on-line promotion assist to the reduction of brochure and promotional costs and enable organizations to reduce their costs.  Developing a cost-efficient eCommerce application and global distribution of multimedia info and promotional material on a 365/24 basis will be very attractive.  Example, in the airline industry eCommerce platform links bookings, check-in and flight details and accumulate historical data of each 28/3/201312Dr Nicos Rodosthenous

Supply-driven E-Tourism  customer across the internet, ITV, WAP and any mobile device of 4G and 5G.  Accepting direct bookings (eCommerce) enable tourism organizations to reduce or eliminate commissions, booking fees and distribution costs.  Organizations use ICTs to monitor their competitors activities and identify opportunities and challenges accordingly.  The emerge of mobile devices as internet terminals will mean that consumers can be offered specialized products interactively. 28/3/201313Dr Nicos Rodosthenous

Supply-driven E-Tourism  ICTs enable tourism providers to develop a unique product for each one of their clients and undertake one-to-one marketing  On the other hand, ICTs empower also consumers to develop the marketing mix of products they wish to buy and search the marketplace for suitable suppliers.  The internet enables tourism firms to develop global specializations and to target markets with very low cost. (skiers, age groups, young, active) 28/3/201314Dr Nicos Rodosthenous

Supply-driven E-Tourism  Developing a community and coordinating its activity interactively can be very profitable for tourism organizations.  Example, a golf-specializing hotel or a tour operator in Cyprus can provide an interactive page and allow guests to undertake a whole range of golf-centered activities.  They can serve their clientele globally at almost no extra cost. 28/3/201315Dr Nicos Rodosthenous

Supply-driven E-Tourism 28/3/201316Dr Nicos Rodosthenous

Supply-driven E-Tourism  Tailor-made tourism products are not a new marketing technique.  The ability of organizations to reach through the internet the entire marketplace electronically and cost-effectively, provide a unique case for differentiation strategies.  4.2. Competitive advantage through time  Consumers appreciate saving time during the information-seeking and reservation process through efficient and interactive mechanisms. 28/3/201317Dr Nicos Rodosthenous

Supply-driven E-Tourism  Time eventually will overtake both cost and differentiation for several markets as a critical factor for buying products.  Simplified and time comprehensive websites enable consumers to complete transactions in few minutes and with a few clicks provide huge competitive advantages and to become winners of the electronic battle.  Example, visiting expedia.com or ebookers.com 28/3/201318Dr Nicos Rodosthenous

Supply-driven E-Tourism  consumers can have access to a one-stop shop for all their requirements, flights, hotels, car rentals, holidays and business trip.  Mobile devices will foster this issue further as consumers on the road will wish to undertake complete transactions almost instantly. 5. Using ICTs for sustainable competitive advantage  Innovative and proactive organizations will lead the way and the rest will follow. 28/3/201319Dr Nicos Rodosthenous

Supply-driven E-Tourism  Modern marketing and new technologies threaten established organizations like British Telecom.  New competitors with interactive interfaces can communicate with their clientele and become more responsive than traditional firms.  Tourism organizations beyond of achieving competitive advantage, they also try to develop mechanisms to sustain in the long term. 28/3/201320Dr Nicos Rodosthenous

Supply-driven E-Tourism  Organizations need to manage their demand in a much more interactive way by constantly monitoring and predicting market trends, offering suitable products and outperforming their competitors.  Organizations that respond instantly at the tactical and strategic level can maximize their performance and achieve sustainable competitive advantage. 28/3/201321Dr Nicos Rodosthenous

Supply-driven E-Tourism 6. Using ICTs to avoid competitive disadvantage  Competitive advantage is based on constant innovation, speed and ability to differentiate or reduce the cost of products.  Ignoring or under-utilizing ICTs can create competitive disadvantage.  eMarkets give rise to newcomers who take advantage of new technologies and increase their market share. i.e. easyJet with 80% bookings through internet. 28/3/201322Dr Nicos Rodosthenous

Supply-driven E-Tourism  Sabre launched Travelocity before other GDSs realized the internet challenge.  Competitive disadvantages emerge from organizations inability to serve their customers properly and to match or exceed competitors’ performance.  Market research and consumer requirements should be incorporated into robust business models by using ICTs as dynamic tools for their implementation. 28/3/201323Dr Nicos Rodosthenous

Supply-driven E-Tourism  ICT-based strategies can be categorized: Long-term planning and strategy, whereby ICTs are viewed as a competitive weapon. Innovative business processes re-engineering is required to redesign all processes and procedures. Commitment of top management is critical as ICTs become the backbone of every strategy. Continuous training throughout the hierarchy will provide decision-makers tools for dynamic management. 28/3/201324Dr Nicos Rodosthenous