14-Ağu-15Travel e221 At tactical level, it includes eCommerce and applies ICTs for maximizing efficiency and effectiveness of the tourism organization.At.

19.Nis.2023 Travel e22 1

• At tactical level, it includes At tactical level, it includes eCommerce eCommerce and applies and applies ICTs for maximizing ICTs for maximizing efficiency and effectiveness efficiency and effectiveness of the tourism organization.of the tourism organization.

Dimitrios BUHALISDimitrios BUHALIS - - Information Technology for strategic tourism managementInformation Technology for strategic tourism management

• As ICT and tourism As ICT and tourism developments are closely developments are closely interrelated, it is often difficult interrelated, it is often difficult to identify whether ICTs to identify whether ICTs generate changes in tourism generate changes in tourism supply and demand, or visa-supply and demand, or visa-versa. Usually reality is versa. Usually reality is somewhere in the middle. somewhere in the middle.

• ICTs provide tools and enable ICTs provide tools and enable evolution of tourism demand & evolution of tourism demand & supply. Consequently, tourism supply. Consequently, tourism industry increases its industry increases its requirements from ICTs. requirements from ICTs.

• In return, developments in ICTs In return, developments in ICTs offer further tools and greater offer further tools and greater potential which are then potential which are then matched by the requirements matched by the requirements of the industry.of the industry.

Impact of ICTs on TourismImpact of ICTs on Tourism

• At strategic level, eTourism At strategic level, eTourism revolutionizes all business revolutionizes all business processes, entire value processes, entire value chain as well as the chain as well as the strategic relationaships of strategic relationaships of the organization.the organization.

• eTourism concept includes all eTourism concept includes all bussiness functions ; bussiness functions ; eCommerce, eMarketing, eCommerce, eMarketing, eFinance, eAccounting, eFinance, eAccounting, eHRM, eProcurement, eR&D, eHRM, eProcurement, eR&D, eProduction, ePlanning, eProduction, ePlanning, eManagement,eManagement, etc.etc.


• CRMs enable organizations CRMs enable organizations to interact with the to interact with the clientsand continuously clientsand continuously change their product to change their product to meeting the customer meeting the customer expectations.expectations.


• ICTs transform the best ICTs transform the best operational practices and give operational practices and give opportunities to expand in all opportunities to expand in all geographical and operational geographical and operational senses..senses..

• However, However, TOURISMTOURISM is an is an industry that has long been industry that has long been regarded as “regarded as “labourlabour” industry, ” industry, and several practices are still and several practices are still carried out in traditional ways. carried out in traditional ways.

• Many small enterprises (small Many small enterprises (small hotels, travel agencies, etc.) hotels, travel agencies, etc.) make it even worse and keep make it even worse and keep ICTs at a minimum.ICTs at a minimum.

• Increasingly, ICTs play critical Increasingly, ICTs play critical role in role in CRMCRM (customer (customer relationship management)relationship management)

Transformation of best operational Transformation of best operational practicespractices

• Managing customer Managing customer relationships on a relationships on a continious (365/24) and continious (365/24) and global way is the key to global way is the key to success for future tourism success for future tourism organizations.organizations.• ICTs must also protect the ICTs must also protect the organization from organization from competitive disadvantages, competitive disadvantages, as they now have to compete as they now have to compete on a global arena..on a global arena..


• CRMs enable organizations CRMs enable organizations to interact with the to interact with the clientsand continuously clientsand continuously change their product to change their product to meeting the customer meeting the customer expectations.expectations.


• Tourism Industry needs to Tourism Industry needs to become;become;– more flexiblemore flexible– more efficientmore efficient– quickerquicker

in responding to customer requests.in responding to customer requests.

• ICTs provide tourism ICTs provide tourism organizations global presence, as organizations global presence, as well as formulate partnerships well as formulate partnerships around the world in an efficient around the world in an efficient and cost-effective manner.and cost-effective manner.

• ICTs also ICTs also reduce operational reduce operational and communucation costsand communucation costs by; by;– integrating operational systemsintegrating operational systems– maximizing internal efficiencymaximizing internal efficiency– decreasing number of people decreasing number of people

requiredrequired– reducing phone calls and faxesreducing phone calls and faxes– enabling customer to have enabling customer to have

access to all informationaccess to all information

• Managing customer Managing customer relationships on a relationships on a continious (365/24) and continious (365/24) and global way is the key to global way is the key to success for future tourism success for future tourism organizations.organizations.• ICTs must also protect the ICTs must also protect the organization from organization from competitive disadvantages, competitive disadvantages, as they now have to compete as they now have to compete on a global arena..on a global arena..


• Developing new Developing new technologies will also technologies will also bring extra costs:bring extra costs:– advertising at search advertising at search

engines, engines, – interconnectivitiy with interconnectivitiy with

other organizations may other organizations may need high investment, need high investment,

– new procedures may new procedures may create new jobscreate new jobs


• However, it must be recognized However, it must be recognized that ICT developments have that ICT developments have certain certain COSTSCOSTS to the company. to the company. Thus, a detailed cost-benefit Thus, a detailed cost-benefit analysys should be drawn before analysys should be drawn before taking action.taking action.

• The cost of hardware and The cost of hardware and software and communucation software and communucation packages, as well as developing packages, as well as developing and maintaining online presence and maintaining online presence is expensive...is expensive...

• Developing interfaces between Developing interfaces between internal legacy systems internal legacy systems and and systems of other organizations systems of other organizations may require high investment.may require high investment.

• Penetration of ICTs in Penetration of ICTs in tourism is generally tourism is generally customer-driven. customer-driven.

• Most of the Most of the technological technological innovations are innovations are demanded by demanded by customers..customers..



• Entire range of hardware, software.

Examples of information technology Examples of information technology applications used in tourism applications used in tourism

• Office automation, reservation, accounting, payroll, procurement management

• Portable wireless devices• Taylor made internal management tools; support

systems, etc.• Databases• Internet / Intranet / Extranet• Computer Reservation Systems (CRS)• Global Distribution Systems (GDS – eg: Amadeus, Sabre,

Galileo)• Property Managements Systems for hospitality; FIDELIO• Internet based travel intermediaries; Travelocity,

Expedia, etc.• Kiosks and touch-screen terminals


• Tourists become demanding, asking for better services at lower rates: getting value for their money .

Dimitrios BUHALIS - Information Technology for strategic tourism management

• Internet increasingly revolutionizes flexibility in both consumer choice and service delivery process. Increasingly customers are becoming much more sophisticated and discerning, as a result of experiencing high levels of service.

• Thus, sophisticated travellers rely heavily on internet & electronic media.

Tourism Dynamic interaction of ICTs and tourism.

DEMAND-DRIVEN eTourism


Leisure vs. business travel demand

• Tourists, demand dramatically more information than experienced travellers

• Experienced travellers however, require greater indepth information as well as being sure that their previous experiences will be addressed.

• Often bookings are not made by travellers themselves, but rather by their secretaries or travel managers in their organizations.


• Inevitably, frequent business travellers are more familiar with travel arrangements having considerable expertise

• Business trips are often classifed into Meetings, Incentves, Conferences & Exhibitions (MICE) categories.


• Business travellers can often compare the prices and offers available online, with the ones offered by their organization.

• He/she can find better deals than their company travel professionals sometimes..

• Thus, business traveller is able to sort out his own travel arrangements, and they often disobey travel policies of their organizations. (playing “amateur travel agency”)

• Business travel represents the highest proportion of on-line travel bookings, not only because it is often quite straightforward, but also most variables, such as time & places are set. Besides, business travellers are better educated and more independent and familiar with computers.


Leisure vs. business travel demand


Package vs. Independent• B2B transactions betwen businesses and travel

companies grow at much faster rate than other sectors of internet

• In Europe, Leisure travel has been much slower to take off. Package Holidays still dominates leisure market. eg: Thomas Cook, Kuoni, TUI, Thomson, STA, Airtours, etc.

• package holiday makers are usually from lower income classes, less familiar with internet

• complexity of family holidays create conditions that are difficult sell online

• commercial interest of tour operator; low profit margins do not let greater IT investments

• existing distribution channels they have

• tour operator computer systems, old-fashioned but still usefull..

REASONS INCLUDE:



• In USA and North America however, leisure market is dominated by independent travellers. That is why internet did much better and much faster..

Package vs. Independent

• Consequently, fast European counterparts, which are the no-frills airlines; e.g.: Ryanair, EasyJet start selling DIRECT and online.

• Small & big hotels also started to use Internet efficiently to reach their clients directly!

• RESULT: The Independent Leisure market grow faster, at the expense of inclusive packages by assisting consumers to substitute some of the functions and value added by tour operators...


• Substituting inclusive package holidays with self-assembled leisure products!Experienced travellers certainly went for it!


FACTS...• According to World Tourism

Organization International Tourism International Tourism Receipts totaled Receipts totaled US$ 733 billion, or US$ 2 billion a day, in US$ 733 billion, or US$ 2 billion a day, in 2006 2006


• While eTravel buyers have some common characteristics, there are differences among various sub-groups on how they travel & how they plan to travel!

• Half of online travel buyers are between the ages35-54. and 33% of them married with children...

• Online Travel market grew 250 % over 1996-2000.


• According to World Tourism Organization internationals arrivals have been 846 million846 million in 2006in 2006 are are expected to reach over 1.6 billion by the year 2020.

FACTS...

• That is to say, about 20% of world’s population will be travelling.

• Travel accounts for nearly 30% of online sales.Airline tickets account for almost 90 % of all online travel sales

• In 2000, 13 billion $ was spent online for airline tickets, hotel bookings and car rentals.


• Better PricesBetter Prices %64 %64

Motivations factors to purchase Motivations factors to purchase onlineonline

• Online secure transactions for CCOnline secure transactions for CC 56%56%

• Ability for cancellation easilyAbility for cancellation easily 52%52%

• Easy to compareEasy to compare 49%49%


• Ability to get answers onlineAbility to get answers online 48%48%

• Better information, better contentBetter information, better content 48%48%

• Brand loyaltyBrand loyalty 38%38%

• Use of local languageUse of local language 38%38%

• Loyalty award programsLoyalty award programs 37%37%• Easiness to orderEasiness to order 36%36%• Familarity with internet purchasingFamilarity with internet purchasing 17%17%


• Obtained Maps & driving directions 59%

Online trip planning activities in USA

• Searched places to stay 54%


• Searched things to do 46%

• Searched airfares/schedules 45%

• Searched for dining&entertaintment 36%

• Searched for rental cars (prices&avail.) 26%

• Searched for places to go 22%

• Searched for package tours & holidays 13%


• “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change”

-Darwin

Web 2.0


Web 2.0

14-Ağu-15Travel e221 At tactical level, it includes eCommerce and applies ICTs for maximizing efficiency and effectiveness of the tourism organization.At.

Documents

tourism industry

tourism supply

tourism organization

tourism developments

impact of icts

strategic level

labour industry

strategic relationaships