According to Burgess et al., (2015), the search for information applicable in travel planning always takes longer and also involves the usage of more sources of information compared to the search for information on other products for consumers. The nature of tourism products is always based on information, which implies that the internet that provides multimedia and global reach capability is a significant means of distribution and promoting travel and tourism services. This report analyzes the intermediary/portal solutions available in the travel and tourism industry and is to be presented to the Senior Management Team of a travel company. The travel company in this report is a medium-sized hotel chain, which until 2009 was a domestic hotel chain in Germany, mainly serving the home market; but during the last 5 years, the company has expanded through targeted strategic acquisitions to be an EU-wide chain, and has aspirations to attract worldwide tourists, including those from USA and Asia as well as across the EU.
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The intermediary/portal solutions currently available, their capabilities, and Critical commentary of their differences
Toimittaja (2015) defined intermediary is the dealer acting as a link in the distribution chain between the customers and the company. Their major role is to bring sellers and buyers together. They also transform the services and goods to a form that the customers would want to buy. The intermediary/portal solutions currently available include web-based portals, travel agents, and Regional Tourism Organizations.
1. Web-based portals
Web-based portals are the latest form of intermediaries or distributors of travel products where the provider of the service or the supplier offers services and products primarily through the internet medium to the clients, in disregard of their physical locality (Dixit, Belwal and Singh 2015).
The tourism industry according to Burgess et al (2015), is characterized by providing other complementary business. The tourists also typically use a variety of travel products such as car hire, air travel, tour, and accommodation services. In most instances, these services are offered by different organizations. Therefore, planning for such travel services can be accomplished by a well-organized and designed portal or website that ensures that the right choices are made, and this may result in a more enjoyable and easy experience for the visitors. Similarly, well-designed web-based portals can also function as a point of distribution for every product or services that a tourist may desire in planning their vacation (Great Britain 2007)
Destinations for tourists always emerge as an umbrella of different brands; therefore, organizations that do destination marketing need to find specific niche markets and suitable design for interaction with the prospective tourists. Similarly, Burgess et al (2015) proposed that each destination for tourists should have a main website that acts as a major tourist’s doorway by offering a central portal to the tourism destination instead of depending on several disjointed individual websites.
2. Travel agencies
These intermediaries are public or privately owned and offer tours and travel-related services to the consumers on behalf of the supplier organizations such as hotels, package tours, railway, hotels, cruise lines, car rentals, and airlines. Moreover, the deal with arrangements for travel for the business travelers, and general sales agents. These agencies are operated by travel agents who professionals are assisting with booking and organizing travel (wiseGEEK 2015).
Travel agencies are organizations that are run by professional travel agents. They can book hotel rooms, reserve a rental car, organize different trips and excursions, and secure restaurant reservations on behalf of the client. Similarly, they can provide recommendations on the places to go, sport to see, things to do, and this is good for the people who have no much experience in the region they are traveling to (Peters & Pikkemaat 2012).
Furthermore, wiseGEEK (2015) indicated that travel agencies offer travel assistance on information about local maps, pamphlets on the appropriate cultural behavior, and travel vaccines information. Besides, they have tips or more information on the best times of the yea to watch out for different things or regions or to travel around the world. Some of them also offer help with travel documents and visas to make it easier for the visitors to travel
3. Regional Tourism Organizations (RTOs)
These are organizations that are usuallypublic-funded intermediaries with their chief purpose of tourism promotion in the entire region. The Regional Tourism Organizations may assume different forms, but they have a tendency of being common and represented mostly in the form of visitor centers and Tourism information. However, more broadly, any organization that promoted a region or any part of the world regarding goods and services that are related to tourism could be potentially classified as Regional Tourism Organization (Burgess et al 2015). RTOs traditionally have acted as the first point of contact for the tourists and provide the tourist’s information on the offered accommodation services and attractions with that particular area or region. However, in recent years, the RTOs have developed a trend of supplementing their traditional functions with web-based portals (Gursoy, Saayman & Sotiriadis 2015).
Evaluation of the benefits of the intermediary/portal solutions to an organization
The web-based portal intermediaries are extremely valuable and beneficial to the organization compared to other intermediaries. Some of the benefits it provides include reduced costs, increased involvement of the customers, increased speed of retrieval and transfer of information, and greater flexibility.
Addressability– The web-based portal intermediaries has the capability of transforming the marketing communication paradigm from broadcasting to narrowcasting, one to one, and one to many. Moreover, by the usage of the internet, it enables the organization to address the consumers individually because every time a visitors browses the portal web sites, the server records the electronic address of the user. This way, the organization can narrowcast or send emails that are tailor-made to an individual consumer or a targeted audience (Liu 2000). However, this form of addressability is not new since even travel agents can apply it using personal selling, telephone, and mail. However, what makes web-based portals so special in this case is the high speed of information and low cost in retrieval and transmission. Moreover, Liu (2000) stated that the addressability of the web-based portals provides organizations a marketing opportunity for managing markets, creating individual relationships, and managing every issue in every development stage
Interactivity– This is another feature of web-based portal intermediaries. Through the relationships has had excellent impact on group relationships. The internet, they have the capability of giving feedback in reaction to the users’ activities on the computer. The potential clients communicate with minimal effort with the organizations in conducting transactions and finding product information with the stroke of keys. Similarly, the organizations can contact their clients easily to inform them of new products or to clarify their needs. Features such as web forms, emails based on the web portals encourage the marketers of the company to interact with their clients (Liu 2000). Moreover, through the benefit of interactivity, the clients who are active participants are in greater control of selecting and processing information about the organization
Flexibility– according to Liu (2000), we based portals is much more flexible compared to other intermediaries. It acts as an electronic catalog, electronic advertisement, and also as an electronic billboard that provides services and products as well as contact information for the consumers interested. Moreover, it can update and gather fresh information based on the received direct feedback from the customers. Besides, it is flexible because the virtual catalog can be organized and developed gradually based on the consumers’ actual interests. Besides, web portals constantly keep consumers informed on the organization’s latest price changes, new product offerings, and sales promotion initiatives.
Accessibility-Web-based portals have an overwhelming advantage over other intermediaries in the travel and tourism sector because of their global market reach and permanent exposure. The website improves its user interaction and information availability greatly. With an effective web portal intermediary, an organization is on business throughout the day and the year on a global spectrum. A user of the web can access the organization’s marketing information at a time convenient for them. This great accessibility is very important t to the company especially in its international trade, especially in Europe.
Global exposure is extremely important to tourism destinations that for many years entirely depended on promotion agencies operating in regions generating tourists to market their products. The adoption of web-based portals will enable the tourism destinations and organizations in the industry to market themselves. Furthermore, the web-based portals assist in avoiding the restrictions and regulations that foreign companies encounter when they physically operate in other countries. Lastly, web-based portals provide unlimited access to millions of users virtually in addition to delivering an unlimited amount of information online because practically there are no restrictions (Liu 2000).
Service improvements– Liu (2000) pointed out that web-based portals also help organizations in improving the quality of their services at all stages of interaction with the consumer- before the sale, during the sale, and after the sale. Web-based intermediaries offer four tangible customer service improvements. First, accessible and larger choices for the consumers since it displays a large set of service and product options. Second, it offers faster processing of payment for customers through credit card charges or cybercash automatic processing. Third, reduced time for delivery for many products such as e-tickets. Fourth, faster, easier, and greater support literature availability, and more particularized and detailed assistance. Liu (2000) observed that web-based portals in the tourism sector can satisfy the needs of the customer for easy and transparent information comparison on a wide range of choices of holiday packages, destination choices, leisure and lodging services, and flights.
Cost-saving– web-based portal intermediaries save costs from five areas. First, electronic processing of payment and booking cuts downs the cost of sales. Second, deskilling and u=automation of tasks reduce staff training costs and labor intensity. Third, by providing direct links to the consumer from the producers or the organizations, it helps the organization in saving high costs of distribution. Fourth, the ability of the web-based portals in electronic communication and narrowcasting leads to a significant saving on the promotion costs. Lastly, this intermediary also saves costs on sales and office space, decoration outlay and furniture, and the administrative overhead costs (Liu 2000).
Similarly, travel agencies are also beneficial to the organization suppliers in many ways. These organizations include hotels, small businesses, large chains, and the hotel industry. The travel agencies have inventories of thousands of hotels and advertise and promote them to business and leisure travelers globally. This helps these organizations to reach the customers that they could not reach themselves (Archer & Syratt 2012).
Similarly, a partnership between hotels and travel agencies is also to drive up the rates of occupancy in hotels. This way, the hotels can fill the empty rooms. By generating marketing opportunities and promotions, travel agencies help hotels reach new potential clients and for boosting their rates of occupancy. Similarly, the hotels can allow the travel agencies to sell more hotel rooms at lower rates to clients without diminishing he brand image of the hotels
According to Oliver, Romm-Livermore & Sudweeks (2009). Travel agencies help and support owners of small business hotels by offering marketing services to assist them in advertising their features and availability. This way, it provides them an international platform for advertising, connecting them globally to potential customers. This enables the small-scale hotels to compete on level ground with large chains of hotels
Analysis of the whole market for these systems and the possible future developments and the benefits these would give.
According to Burgess et al (2015), the nature of the travel and tourism industry is information-intensive and this suggests the essential function of web technology in marketing and promoting traveler’s destinations. With the numerous accounts of travel reservations and purchases being among the segments of the communicating information. Applying the concept of public sphere, people nowadays communicate, discuss and influence public opinions using the internet community that is growing fastest, it is not surprising that the quantity of web-based tourism operatives has considerably risen for the past few years.
The capacity of the RTOs to complement their traditional functions and locations provides a more feasible and alternative point of contact especially for the international tourists who more and more use the internet to do some inquiry on their holiday destinations in advance before Samsung’s Diversification Strategy: The Case of Samsung Motors Inc. Long Range planning. Burgess et al (2015) indicated that another benefit of the adoption of web technology by the Regional Tourism Organizations is the increased ability of small companies and organizations to compete online. This enables them to market their services and products globally at a significantly reduced cost.
In the travel and tourism industry, travel agents still play a significant role and with the emergence of the online regime, their stakes will be revised soon. However, how they will be affected in the years to come, entirely rest on how innovative and flexible they will embrace and adopt new technologies, as well as how the web affected everyday life and businesses (Dixit, Belwal and Singh 2015). The travel agencies globally will have to readjust to fit into the era of the Internet by acting as product and travel information managers.
Savvy organizations observe their move keenly while marketing their products and services to their clients and are linking new technology with old-style business practices to forge strong customer ties. Web-based portal intermediaries are being embraced by these organizations for selling, serving, saving, and sizzling. With these values, the organizations in the travel and tourism industry can increase sales, get close to customers, add value, save costs and create dialogue as well as extending the organization’s brand.
Dixit, Belwal, and Singh (2015) indicated that a robust system of online technologies assists in creating an atmosphere of convenience and spontaneity. The possible future developments could see sophisticated contact center solutions, self-service tools that are easy to use, focussed marketing, value-added services, and customized websites to provide autonomy, accessibility, and higher user awareness. This way, it will provide several further ways of building loyalty. The organizations that will come up with a strategy that is well-conceived for enhancing loyalty for customers through developments in technology can attain remarkable outputs that would result in long-term relationships, high margin customers, and reduced customer turnover (Wang 2014).
According to Dixit, Belwal, and Singh (2015), the adoption of online technologies in addition to traditional methods of intermediary has resulted in numerous changes in the travel and tourism industry. The main impact of the several changes has been an interaction between traditional intermediaries and service providers. Moreover, it has provided the tourists globally a tool for expressing their needs, seeking details on facilities, destinations, geography, prices, and climate information for different tourism services and products. Similarly, online technologies have boosted the travel agencies while looking for more details or information about trends in the market, tourism, destinations, service providers, availabilities, facilities, our packages, prices, and lastly in keeping direct contact with their partners in the industry
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