E-TourismNicos Rodosthenous PhD

04/04/20138

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Operational management and distribution in E-Tourism

1. Introduction The purpose of this chapter is to explain the

mechanisms and operational requirements of the tourism industry.

2.Tourism distribution mechanisms and practice Distribution is one of the most critical factors for

the competitiveness of tourism organizations and destinations.

Distribution channels build bridges with consumers address their needs and provide mechanisms to buy tourism products.

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Operational management and distribution in E-Tourism

ICTs enable several players such as CRSs, GDSs and DMSs to emerge and facilitate the distribution of tourism products.

Internet strengthened the role of electronic intermediaries and developed their strategic position for tourism suppliers.

They also affect the other marketing-mix ‘Ps’ elements, as they determine the price, formulate tourism products, facilitate promotion and establish communication.

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Operational management and distribution in E-Tourism

ICTs changed the function of distribution:o from facilitation of information exchange and

reservations to a much more sophisticated mechanism of adding value and providing service.

o to a rapid expansion of intermediaries in the marketplace.

Primary distribution functions for tourism are: information, combination and travel arrangement services.

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Operational management and distribution in E-Tourism

Principal role of intermediaries is to bring buyers and sellers together, either to create new markets or to expand existing market size and work more efficiently.

Distribution in tourism is much stronger than other trade intermediaries as travel agents, tour operators, charter brokers CRSs, GDSs have greater power to influence and direct demand .

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Operational management and distribution in E-Tourism

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Operational management and distribution in E-Tourism

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Operational management and distribution in E-Tourism

3. ICT tools for managing the digital tourism organization

Digital firms and tourism organizations manage all their business processes and relationships with customers, suppliers and employees electronically. (figure 6.4)

3.1. Internet-supported eTourism management Tourism organizations use ICTs to communicate

with all stakeholders and consumers and to manage and control their inventory.

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Operational management and distribution in E-Tourism

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Operational management and distribution in E-Tourism

Internet is used extensively by both tourism enterprises and destinations for eCommerce and for selling products directly to their consumers as part of the promotion mix.

Most tourism organizations have their own web page providing:

• information and reservation capabilities• search for availability and prices• on-line bookings• dynamic pricing according to demand and supply

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Operational management and distribution in E-Tourism

• interaction with loyal customers and maximize customer loyalty. (i.e. airlines loyalty schemes)

• TUI, the largest tour operator in the world provides environmental info analysis and monitoring of tourist destinations.

3.2. Internal systems and intranet-supported eTourism management.

They facilitate a number of operational decisions and processes such as airlines, trains, ferries, hotels and car rentals.

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Operational management and distribution in E-Tourism

Controlling inventory and managing demand for their products.

Managing the production process and coordinating departments within organizations.

Information is critical for the production and operation of most tourism products. i.e. airlines sales and ticketing with check-in.

Intranets used to re-engineer, automate and facilitate the entire range of eBusiness functions.

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Operational management and distribution in E-Tourism

eMarketing and eSales enable tourism organizations to develop their marketing management and their strategies.

Intranets enable them in developing budgets and regular financial reports, monitoring cash flows and invoicing.

ICTs are the tools for achieving the business model of tourism organizations, enable them to fulfill their mission and eStrategy.

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Operational management and distribution in E-Tourism

• eLearning enable tourism organizations to share their vision and strategy with their staff and to achieve the organizational goals. i.e. service quality and customer satisfaction.

• eControlling involve indicators such as sales figures, average fares, load/seat factors, productivity measures and questionnaires.

• Intranets enable tourism organizations to maximize their efficiency and effectiveness with knowledge management systems.

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Operational management and distribution in E-Tourism

3.3. Partner systems and extranet-supported eTourism management

For example, a tour operator can access a dedicated part of a hotel company’s intranet to see corporate rates and availability for their clients or to update rooming lists and manifests.

Extranets can increase interactivity, efficiency and productivity of the entire value chain.

Although CRSs, GDSs and extranets can not take advantage of the World Wide Web they can control

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promote, and sell their products through the range of partners and suppliers in the international market.

eProduction and eManufacturing can be used for external partners to serve consumers.

Tourism organizations rely on virtual and outsourcing corporations for vital functions. i.e. airlines and hotels with catering, IT services.

eProcurement and eSupply management are the most popular functions of extranets.

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Operational management and distribution in E-Tourism

Purchasing products in a B2B environment is one of the most successful applications of the internet globally. i.e. hotels ordering inputs on-line.

eAccounting and eFinance assist partners to transfer money between accounts and to follow up process of payments. i.e. shareholders on-line.

ICTs enable tourism organizations to promote vacancies across the Internet, to manage applications

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Operational management and distribution in E-Tourism

and recruitment by using their intranets. eHuman resources is used when parts of the

tourism operation are outsourced.4. Managing eTourism sectors through ICTs The tourism distribution channel is a complex

system involving airlines, travel agencies and tour operators.

The channel perform the development and delivery of tourism products and services.

E-Tourism , Internet, extranet and intranet

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can apply to all sectors of the tourism industry such as transportation, hospitality, catering.

ICTs play a critical role in the production, marketing, financial, operational and distribution functions of both the private and the public sectors.

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