INTRODUCTION

INTRODUCTION TO
TO
TOURISM
TOURISM INDUSTRY
INDUSTRY
CHAPTER 2
Learning Outcome

1. Understand the travel and

tourism industry
2. Elaborate differences between
travel agent and tour operator
WHAT IS TOURISM?

Activities of person traveling to and staying in places

outside their usual environment for not more than
one consecutive year for leisure, business and other
purposes”
(World Tourism Organization, 2004)
“Tourism is a composite of activities, services, and
industries that delivers a travel experience:
transportation, accommodations, eating and drinking
establishments, shops, entertainment, activity
facilities, and other hospitality services available for
the individuals or groups that are traveling away
from home”
McIntosh et. Al(2000, pg 14)
 Travel and Tourism -
World’s Largest Industry
• In 2011 it is estimated to account for
some:
 $5.9 trillion of Economic Activity
 258.5 million jobs

• In 2021 it is estimated to account for:

 $11.9 trillion of Economic Activity
 323.8 million jobs

Source: WTTC, 2013

 Travel and Tourism Can
Grow by 4% per year
• Travel and Tourism will continue to expand
faster than the economy as a whole and
faster than comparable industries.
• By 2021 Travel & Tourism is expected to
account for:
• $11.9 trillion
• 323.8 million employees
• Growth depends on enlightened government
policy

Source: WTTC
 World’s Top 5 Tourism
Destinations 2009
International
Tourist Arrivals
Rank, (million) % Change 2009
Country 2009 2009/08

1 France 74.2 -6.3

2 United States 54.9 --5.3 3
Spain 52.2 -8.7
4 China 50.9 -4.1 5
Italy 43.2 1.2

Source: UNWTO
 World’s Top 5 Tourism
Destinations 2010
International
Tourist Arrivals
Rank, (million) % Change 2010
Country 2010 2010/09

1 France 76.8 0.0

2 United States 59.7 8.7
n3 China 55.7 9.4
4 Spain 52.7 1.0
5 Italy 43.6 0.9

Source: UNWTO
 World’s Top 5 Tourism Earners
2009
International
Tourism Receipts
Rank, (US$ billion) % Change
2009 Country 2009 2009/08

1 United States 93.9 -14.6

2 Spain 53.2 -9.0
3 France 49.4 -7.9
4 Italy 40.2 -7.2
5 China 39.7 -2.9

Source: UNWTO
 World’s Top 5 Tourism Earners
2010
International
Tourism Receipts
Rank, (US$ billion) % Change
2010 Country 2010 2010/09

1 United States 103.5 9.9

2 Spain 52.5 -1.2
3 France 46.3 -6.2
4 China 45.8 15.5
5 Italy 38.7 -3.6

Source: UNWTO
4 Different perspectives of tourism

1. The tourist
2. The businesses providing tourist goods &
services
3. The government of the host community or
area
4. The host community
4 Different perspectives of tourism

1. The tourist
 Seeks various physic and physical experiences and
satisfactions.
 determines the destinations chosen and the activities

2. The businesses providing tourist goods and

services
 Businesspeople – tourism as an opportunity to make a
profit by supplying the goods and services that the
tourist market demands.
4 Different perspectives of tourism

3. The government of the host community or

area
 Politicians – tourism as a wealth factor in the economy of
their jurisdictions
 Related to incomes their citizens can earn
 Foreign exchange receipts (tax receipts collected from
tourist expenditures)

4. The host community

 Local people – tourism as cultural and employment
 May be beneficial or harmful
 Types of tourism

1. International tourism
a) Inbound tourism
b) Outbound tourism

2. Internal tourism
3. Domestic tourism
4. National tourism
 Types of tourism

1. International Tourism
a) Inbound tourism: visits to a country by non-
residents. E.g. Australian to Malaysia
b) Outbound tourism: visits by residents of a
country to another country. E.g. Malaysian to China

2. Internal Tourism
• Visits by residents of a county to their own country
• E.g. Kuching to Kuala Lumpur
 Types of tourism
3. Domestic Tourism
• Internal + inbound
• E.g. Kuching to Kuala Lumpur (Malaysian)
• E.g. Australian to Malaysia

4. National Tourism
• Internal + outbound
• E.g. Kuching to Kuala Lumpur (Malaysian)
• E.g. Malaysian to China
 Definitions of Tourists

1. Visitor
 Same-day visitors?
 Tourists?

2. International tourists
3. Excursionists
4. Domestic tourists
 Definitions of Tourists

1. Visitor
• Same day visitors – visitors who do not spend the night
in a collective or private accommodation in the country
visited. E.g. a cruise ship passenger spending for hours
in a port or day trippers visiting an attraction
• Tourists – visitors who stay in the country visited for at
least one night. E.g. a visitor on a two week vacation

2. International Tourists
- Temporary visitors staying at least 24 hours in the
country & purpose of journey can be classified:
 leisure (recreation, holiday, study, religion, sport) or
 business (family, mission, meeting)
Definitions of Tourists

3. Excursionists
 temporary visitors staying less than 24 hours,
including passengers on cruise ships

4. Domestic Tourists
 referring to tourists who do not go outside their
country of residence
 Nature of Tourism

movement of people to and stay in various

places of destinations

outside usual environment or normal place of

resident and work

temporary periods and short term

visited for purposes other than permanent

employment and residence
 Nature of Tourism
1.Travel
the action and activities of people taking trips to a place
or places outside their home communities for any purpose
except daily commuting to and from work
2.Leisure
a combined measure of time and attitude of mind to
create periods of time when other obligations are at a
minimum – free time
3.Recreation
the action and activities of people engaging in
constructive and personally pleasurable use of leisure time
COMPONENT OF TOURISM & TOURISM
MANAGEMENT

1. The tourist
2. Catalyst, planning, development &
promotion organizations
3. Operating sectors (spirit of hospitality)
4. Natural resources & environment
5. The process, activities & outcomes of
tourism
6. Careers in tourism
COMPONENT OF TOURISM & TOURISM
MANAGEMENT
1. Tourist

2. Catalyst, planning, development &

promotion organization
- Public sector and private sector

3. Operating sectors (Spirit Of Hospitality)

- Accommodation, tourism services, transportation,
entertainment, food services, adventure & outdoor
recreation, attractive, events, travel trade.
COMPONENT OF TOURISM & TOURISM
MANAGEMENT
4. Natural resources and environment
- Physiographic, climate, people
- Built environment (information, culture, technology,
government, superstructure, infrastructure)
5. The processes, activities and outcomes of
tourism
- Organization – Philosophy – Research – Policy – Vision –
Strategy – Planning – Development – Marketing –
Visitation – Behaviors – Experiences – Impacts – Monitoring
-
Evaluation - Stewardship
6. Careers in tourism
- Lodging, Food n Beverage, Travel & Tourism Industry
Basic Structure of the U.S travel
industry
Governments
IATA,ATA
other
Airlines &
Other
Carriers

Hotels Any Tour

Wholesaler
Other
Destination Retail Travel
Services Agent or Other
Retail Outlet

Suppliers

Public
A. TOUR OPERATORS
 A. TOUR OPERATORS

Put together a tour & all of its components, sells the tour
through his/her own company through retail outlets &/or
through approved retail travel agencies
Offer vacation packages to the traveling public at prices
lower than individual traveler can arrange
Because wholesalers can buy services
( transportation, hotel rooms, sightseeing services, airport
transfers & meals) in large quantities at discounted prices
A. TOUR OPERATORS

Planning, preparing & marketing a vacation tour including

making reservations & consolidating transportation &
ground services into a tour
Tour sold to the public through retail outlets (travel agents
& airline ticket offices)
Provide the retailer & the public with a wide selection of
tours to a large number of destinations at varying cost,
durations & various seasons
A. TOUR OPERATORS

Supply advance notice & increased assurance of future

passenger volumes to suppliers
Consolidating the services of airlines & other carriers with
the ground services needed into one package, can be sold
through travel agents to the consuming public
A. TOUR OPERATORS
ORGANIZATIONS:
1. NTA
2. USTOA
3. ASTA
4. PATA
5. CTO
6. TIA
 A. TOUR OPERATORS
NTA (National Tour Association)
 Interest in the packaged travel sector
 Promoting partnering & networking among members,
suppliers & destinations
 Focuses on development, promotion & increased use of
packaged travel
 Consumer advocate through code of ethics, membership
requirement & education
 Provides marketing assistance, educational programs,
governmental representation & communication for
membership and produces (NTA Convention and Tour &
Travel Exchange)
 A. TOUR OPERATORS

USTOA (United States U.S. Tour Operators

Association)
 Ensure consumer protection & education
 Inform the travel industry, government agencies & public
about TO activities & objectives
 Maintain high level of professionalism
 Members required to represent all information about tours,
maintain high level of professionalism, state clearly all cost
& facilities in advertising & promotional materials
B. TRAVEL AGENTS
B. TRAVEL AGENTS

Middleman – a business / person selling the travel

industry’s individual parts / combination of the parts
to the consumer
Agent middleman, acting on behalf of the client,
making arrangement with suppliers of travel (airlines,
hotels, tour operators) & receiving commission from
suppliers / fee from client
B. TRAVEL AGENTS
Agent of the principal
Legally appointed agent, representing the principal in a
certain geographic area
As broker (bring buyer & seller together) for the other
suppliers (hotels, car rentals, ground operators & tour
companies)
Expert, knowledgeable in schedules, routing, lodging,
currency, prices, regulations, destinations & other
aspects
Specialist & counselor , save client both time & money
B. TRAVEL AGENTS

The Changing World of the Travel Agent

1. Tangible factor contribute decline
2. Internet
3. Airlines now attempt to bypass travel agents
B. TRAVEL AGENTS
ORGANIZATIONS
1. ASTA
2. ARTA
3. NACOA
4. ICTA
5. CTC
6. CTA
 B. TRAVEL AGENTS
ASTA (American Society of Travel Agents)
1. Promote & encourage travel among people of all nations
2. Promote the image & encourage the use of professional TA
3. Promote & represent the views & interests of TA to all levels
of government & industry
4. Promote professional & ethical conduct in the TA industry
5. Serve as an information resource for the industry worldwide
6. Promote consumer protection & safety for the traveling
public
7. Conduct educational programs for members on subjects
related to the travel industry
8. Encourage environmentally tourism worldwide