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WORLD TOURISM ORGANIZATION
E-tourism
Electronic Commerce Strategies for Development: Promoting an International DialogueTunis, 19-21 June
WORLD TOURISM ORGANIZATION
Access
WORLD TOURISM ORGANIZATION
The On-line Market is thereForecast for European markets
192 200 208212 216
223 230 237 244
0.227 0.811 2.64 4.73 6.77 8.45 10.9 12.8 14.70
50
100
150
200
250
300
1998 1999 2000 2001 2002 2003 2004 2005 2006
Market M€(000) Internet salesM€(000)
Market share
0%
1%
2%
3%
4%
5%
6%
7%
1998 1999 2000 2001 2002 2003 2004 2005 2006
- 64% of Internet sales are direct sales.
- UK sales represent 34% of Western Eurepean sales.
- Airlines are 60% of total sales and half of this is from low-cost airlines
WORLD TOURISM ORGANIZATION
Distribution costs are a growing area of potential savings
$ 20 billion per annum: 4% of overall costs and growing.
WORLD TOURISM ORGANIZATION
The Electronic Marketplace in tourism –
eBusiness Business Consumer Government
Business B2B
Extranets between
Hoteliers and tour
operators
B2C
eCommerce applications where consumers purchase air tickets
B2G
Business interacting with government departments, e.g. hotel developer requires planning permission
Consumer C2B
Consumers registering
their preferences on airline or hotel loyalty/executive clubs
C2C
Consumers informing other consumers over good or bad practice (e.g. www.untied.com)
C2G
Consumers applying for visas, requesting maps and local destination information
Government G2B
Government informing hotels about food safety legislation or taxation
G2C
Government informing consumers on regulations, visa or vaccination requirements
G2G
Governments interacting in tourism policy matters or asking technical assistance through organizations such as the World Tourism Organization
Source: Buhalis D., “eTourism”
WORLD TOURISM ORGANIZATION
New Business Models
• Tiscover
• GTREX
WORLD TOURISM ORGANIZATION
Three online firms now control over 55 percent of all online travel bookings
0102030405060708090
100
Online Travel
Online Agents
Suppliers
Source: Peter O’Connor, IMHI, 2003
WORLD TOURISM ORGANIZATION
WTO activities in E-tourism:
•Publications:•Marketing Tourism Destinations Online, 1999•E-Business for Tourism, 2001
•Seminars
•Capacity building: •Courses for National Tourism officials of WTO member States
•Partnership with IFITT•Bench-marking scheme for Destination Web Sites•Harmonise
WORLD TOURISM ORGANIZATION
WORLD TOURISM ORGANIZATION
Hotel
Hotel
Hotel
DMS
Switch
GDS Travel Agents
TICs
Cu
stom
er
Hotel
3rd Party CRS
CRS
Traditional IntermediariesElectronic Intermediaries
As it was in the beginning….
Source: Peter O’Connor, IMHI, 2003
WORLD TOURISM ORGANIZATION
Is now…..
CRS
Hotel
Hotel
Hotel
Hotel
Web Intermediary
GDS Travel Agent Customer
Customer
Customer
Customer
Customer
Customer
Customer
Customer
Customer
Rep Company
DMS
Switch
DMS Web site
Rep Company Web site
TIC
GDS-based Web site
Switch Co Web Site
Hotel Web site
CRS Web site
Hotel
Customer
Customer
Customer
Source: Peter O’Connor, IMHI, 2003
WORLD TOURISM ORGANIZATION
Critical tourism and hospitality functions supported by ICTs
• Front office: reservations, check-in, payments• Back office: accounting, payroll, human resources
management, marketing• Customer entertainment and service• Communication with consumers and partners• Marketing research• Reaction and management of unexpected events• Flexible and dynamic pricing through yield management• Differentiation and personalization of products• Monitoring performance indicators and building feedback
mechanisms• Control of business processes and personnel
WORLD TOURISM ORGANIZATION
Examples of information technology applications used in tourism
• Entire range of hardware, software and netware• Stand alone computers and network devices• Office automation, reservation, accounting, payroll and
procurement management applications• Portable/wireless communication devices• Internal management tools such as management
support systems, decision support systems and management information systems
• Tailor-made internal management applications• Databases and knowledge management systems
WORLD TOURISM ORGANIZATION
Examples of information technology applications used in tourism
• Internet/intranets/extranets • Networks with partners for regular transactions (EDI or
extranets)• Networking and open distribution of products through the
Internet• Computer reservation systems (CRSs)• Global distribution systems (GDSs) (e.g. Galileo, SABRE,
Amadeus, Worldspan)• Switch applications for hospitality organizations (e.g.
THISCO and WIZCOM)
WORLD TOURISM ORGANIZATION
Examples of information technology applications used in tourism
• Destination management systems (DMSs)• Internet-based travel intermediaries (e.g. Expedia.com,
Travelocity.com, Preview Travel, Priceline.com, etc.)• Mobile/WAP-based reservation systems• Traditional distribution technologies supporting automated
systems (e.g. videotext)• Calling centres• Interactive digital television (IDTV)• CD-ROMs• Kiosks and touch-screen terminals
WORLD TOURISM ORGANIZATION
Internal systems and intranets
• Improving capacity management and operations efficiency
• Facilitating central room inventory control• Providing last room availability information• Offering yield management capability• Providing better database access for management
purposes• Supporting extensive marketing, sales and operational
reports• Facilitating marketing research and planning• Providing travel agency tracking and commission
payment
WORLD TOURISM ORGANIZATION
The small e-business
• The ICT illiteracy of the entrepreneurs• Lack of marketing and technology understanding• The cost of ICT’s being perceived as prohibitive for
entrepreneurs• Inability to control the equipment• Perceived dependence on trained staff• Lack of standardization and, often, professionalism• Seasonality and limited period of operations in resorts• Insufficient training and established organizational practices• Small size multiplies the administration required by CRS’s to
deal with each property• The unwillingness of SMTE’s to lose control over their property
WORLD TOURISM ORGANIZATION
“Tourism is a very information intensive activity. In few other areas of activity are the generation, gathering, processing, application and communication of information as important for day-to-day operations as they are for the travel and tourism industry”
Poon 1993