Tourism Challenges and Trends

This assignment delves into the current challenges and emerging trends within the tourism sector. It examines topics such as sustainable tourism, the impact of technology, changing tourist demographics, and the role of volunteer tourism. The analysis draws upon academic research and online resources to provide a comprehensive understanding of the issues confronting the industry and potential solutions for a more sustainable future.

Contemporary Issues
in
Travel and Tourism

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Analysis of issues currently driving changes in the travel and tourism sector.....................1
1.2 Analysis of different current issues using appropriate methods and resources....................2
TASK 2............................................................................................................................................4
TASK 3..........................................................................................................................................10
3.1 Analysis of ways to respond to change by International Airlines Group...........................10
3.2 Strategies development for selected businesses to respond to change................................11
3.3 Justification for strategy selection.......................................................................................12
TASK 4..........................................................................................................................................13
4.1 Analysis of impacts of issues and trends that drive change in the travel and tourism sector
...................................................................................................................................................13
4.2 Likely consequences of businesses failing to respond to market changes..........................14
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
Tourism is a industry which is a combination of many other individual industries to
provide better services and offers to its customers. The term tourism involves travelling for
pleasure, business, etc. It not only includes travelling but also includes accommodation, touring,
and entertaining activities for the customer (Moutinho, ed., 2011). It also combines other sectors
to provide maximum satisfaction and memorable experience to their tourist. It can be in the
local vicinity of the country or outside the country depending upon the choice of destination and
purchasing power of the customer.
The aviation industry is directly related with travel and tourism sector as it provides
travel facility to the customers. The aviation industry is a main part of the industry along with the
other means of transport such as cruise, railway, etc. and other features of the service include
accommodation and tours in destinations (Evans, Stonehouse and Campbell, 2012). A major
airline company, International Airlines Group formed by British Airways and Iberia in 2011. It is
a UK based company with the rank of sixth largest airline in the world. The aviation company is
facing challenges in the current situation which can only be resolved by forming proper
strategies. In the report, challenges faced by the travel and tourism companies and techniques to
identify as well as to respond to them are explored. The tourism companies in UK are prone to
impacts of the changes in the aviation sector and they need to develop strategies accordingly.
TASK 1
1.1 Analysis of issues currently driving changes in the travel and tourism sector
Travel and tourism is a fast growing industry and is a major source of revenue in many
countries. . UK is considered as a main attraction for tourists around the world. Tourism is a
major element in country which contributes heavily in the economy and cultural development. It
registers a large number of tourists every year. The local government has put efforts in
developing tourism places and preserving heritage of the country (Wachowiak, ed., 2016).
People travel in this country because of various reasons such as business, education, leisure etc.
There are some major tourist destination cities in the country which contribute a large portion of
revenue. The main factors driving change in this sector are:
Technological development: It has major impact on travel and tourism of a country. It
simulates communication and connectivity between various countries which provides more
options to people to explore while choosing a tourist destination. Technology creates awareness
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among tourist about the new and old destinations for the tourism and provides various ways to
travel and stay in the place (Spenceley, 2012). It also helps the countries to promote tourism and
increase the revenue. UK is considered as one of the most visited country for tourism as well as
business purpose due to various technological changes such as mobile technology, social
networks, online operations, etc. These changes have affected the search process and sources for
receiving information which adds to the various ways to approach the potential customers for
the company.
Security: The need for security has increased in all places over the world due to frequent
terrorist attacks (Connell, 2013). It reduces preferences for such destiantion to be selected by
tourists. The main concern for tourist is that the place should be safe for themselves and their
families. The attacks in UK targeting the tourism places such as London, Birmingham,
Manchester, etc. in past many years have made people more concerned for their safety before
travelling to any of its cities..
New markets: The emergence of new markets in UK has triggered more investments in
the country resulting in more people travelling to the country for the business purposes. The
increase in business prospects in a country attracts more investors and companies leading to
economical and infrastructural development of the place (Dickinson, Lumsdon and Robbins,
2011).
Increased air fares: The increase in air fares as a passenger duty and tax in UK has
caused decrease in the number of tourists. number of. The increase of 10 percent in the rates can
lead to cancellation of travel plans reducing the revenue as compared to previous years.
Education: As the world is becoming more connected, people are getting more aware
about education and qualifications. This enables them to travel to other countries to obtain better
education and degrees. It creates a diverse environment for the students and develops the socio
culture. UK receives a large student base from foreign regarding various degrees in colleges.
Infrastructural development: The development of the infrastructural facilities of a country also
leads to increase in the economy and tourism activities. It creates better lifestyle and
opportunities for the people (Pritchard, Morgan and Ateljevic, 2011).
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1.2 Analysis of different current issues using appropriate methods and resources
The current issues in the travel and tourism sector should be identified by using proper
methods and resources. Even though tourism industry is rising and generating large revenues, it
has some factors which should be considered before selecting a tourist destination (Crooks and
et.al, 2011). The large number of tourists increases the risk of exploitation of natural resources
and ecosystem of the place. With excess use, these natural resources can get depleted faster than
expected leaving the people to bear the effect of loss. These resources are the main source of
attracting tourist to the place and after loss of resources it can repel the tourist.. It can affect the
bio diversity of other living creatures in the same area leading to the verge of extinction for some
creatures and driving them to vicinity of local people.
Environmental awareness: The major issue for the tourist destinations in the country is the issue
of environmental awareness among the tourists. The exploitation of the natural resources to
provide facilities to the tourists results in depletion of the resources faster than expected leaving
the locals to bear the effects. The environment of any place is its core which should be valued by
the people living in the area or visiting the place (Kang and et.al, 2012).
Health issues: For tourists travelling to any destination, health is a prior concern as it
includes the health of self as well as the people travelling with him. The increasing pollution and
bio hazardous places needs to be identified prior to the visit in the country. These factors are
leading to decrease in the tourist levels of the country as people are becoming more aware about
the health and safety issues.
Responsible tourism: It is a form of tourism in which enables people to create better
place to live as well as visit. It includes minimizing the negative aspects of tourism on economy
and environment, creates better community and lifestyle, provides enjoyable experience to the
tourists while maintaining a clean environment, making contribution to the society for
betterment, etc. This activity makes a positive impact on a destination rather than exploitation of
the resources (Dickinson and et.al, 2014).
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TASK 2
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TASK 3
3.1 Analysis of ways to respond to change by International Airlines Group
International Airlines Group being in the travel and tourism industry needs to analyse the
market trends and demands to plan the strategies accordingly (Hall, 2010). The strategy
development team is responsible for creating the accurate and flexible strategies for the company
in order to cope up with the dynamic market while satisfying the demands of the customers. To
respond to the changes in the market company needs to perform a SWOT analysis of its strengths
and weaknesses to get an overview for responding to changes.
As per the decision of UK government to opt out of European Union, the impact of this
will be seen in a few years but as an impact on the tourism industry the air passengers will be
reduced by 3-5 percent due to the downfall in economic activity. This will show the impact in the
long run for the country (Hartmann, 2014). The decision has not only affected the tourism sector
it has also decrease the value of currency. Weaker the currency the more chances of decrease in
tourism activities are ascertained. As it affects the purchasing of the people in the country and
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discourage outbound travel. Whereas on the other hand the inbound tourism will take on rise
with this effect and attract more tourist and foreign exchange in the country. The main factor
affecting the tourism sector is the inbound tourism, which will not be an issue for the country
(Ooi and Laing, 2010).
The international Airlines Group should focus on the inbound travellers from outside the
country as it is estimated to attract more of them while also focusing on the outbound travel by
providing deals and offers to encourage the customers. The company can also adapt to the
changing environment and market conditions in order to get the latest technology changes and
upgrades. This can create opportunities to perform better and attract large customer base. While
the rates have increased it will not affect the profits of the company as much as the customer
base. The firm can loose its established and loyal customers due to its rigid approach (Ashworth
and Page, 2011). Hence, to respond to the changing market conditions the aviation company
needs to involve new policies in the planning and strategy development function to create offers
to maintain the customer base.
3.2 Strategies development for selected businesses to respond to change
International Airlines Group is a British-Spanish multinational airline holding company
formed by merger of British Airways and Iberia, the major airlines of UK and Spain
respectively. It is the 6th largest airline company in the world while the original companies
continue to operate under their former names. In the present market with the ever changing
environment the company needs to analyse the internal strengths and weaknesses along with the
external threats and opportunities (Pomering Noble and Johnson, 2011).
Strength: The company being one of the largest airline company has a very large and
varied customer base which enables it to maintain its position in the market even after the
changes. The company can develop and offer new packages with low fares and can operate in
profit position by cost cutting (Smith Costello and Muenchen, 2010).
Weaknesses: The aviation company operating in various places faces a challenge so as to
develop strategies and plans according to the region and market. To create offers and deals at
such a large scale is a difficult task and changing the policies again and again can hamper the
working of the company.
Opportunities: In the current market situation when all aviation companies are facing a
reduction in the passengers due to rise in fares in UK can provide opportunity for the
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International Airlines Group by providing same facilities with relatively less increase in the
prices. This will help the firm to maintain the customers and to enhance the brand image (Hall
and Page, 2010).
Threats: The new emerging airlines companies with lower prices and better deals poses a
threat to the company increasing the competition. The customers who prefer quantity i.e. prices
over quality of services may prefer the new companies over the established ones (Reddy, York
and Brannon 2010).
In the current situation with the recent changes in policies of UK, Iberia being a Spanish
company can also suffer the consequences of this as it is also a part of IAG. The airlines has
adopted the UK based economy and features which has an impact on the cost of the company.
The firm needs to identify its strong areas and create strategies according to the prices rise and
preference changes. It can reduce the cost by removing the extra services provided (Kusluvan
and et.al, 2010).
Whereas, British Airways being a UK based company will have a direct impact of the policy
change. It needs to maintain its clients and customers by providing quality services which is its
strong point but can eliminate the free meals and accessories for cost cutting.
3.3 Justification for strategy selection
The strategies selected for the mentioned airlines and its individual companies, British
Airways and Iberia are according to the changes in the market and the policies affecting it. The
companies are required to form strategies which helps to maintain the customer base along with
attracting new customers and maintain the profits of the company. This can only be done by few
methods one of them is being cost effective (Carlisle and et.al, 2013). The company needs to
reduce the costs by eliminating few additional services and can now charge the customers for the
same. The other method involves creating attractive packages for the tourist, it will increase the
inbound tourist base and revenue for the company. The company needs to focus on the other
countries and regions to promote tourism and its services as the local tourist with reduced
purchasing power will be unwilling to invest in the leisure activity (Kim, 2010).
PEST analysis is a technique which analyses the external i.e. macro environment factor
of a company and provides detailed evaluation through strategic management. It is a part of the
function market research. The main factors considered in the method are political, economic,
social and technological.
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Political- The political factors are related to the government of the country. It includes
laws and policies of the government regarding trade and business in the country. The more stable
government provides more efficient environment for the companies to grow and expand as the
companies will not have to change the plan of action from time to time (Mariani and et.al, 2014).
Economic- The economic growth, inflation rate, etc. are considered in this factor while
analysing the market. These affect the growth and development of the economy.
Social- These factors include the population, growth rate, age, literacy rate, etc. to
analyse the market for the company to formulate the strategies accordingly. These factors enable
the companies to identify and classify the customers according to different elements (Rogerson,
2013).
Technological- The technical factors such as technological developments and R&D
activities are evaluated to increase the efficiency and production level of the business.
These factors should be analysed while forming strategies for the aviation companies in
order to have accurate and reliable plan of action. The aviation companies, both being a part of
IAG based in UK needs to plan their offers and packages to deal with the decrease in the number
of passengers by focusing on the other aspects and other regions to seek help in increasing the
revenue. Thus, the strategies selected are in favour of the companies and the customers as well
(Cohen, 2011).
TASK 4
4.1 Analysis of impacts of issues and trends that drive change in the travel and tourism sector
Myla Travel being an independent travel agency and having specializing in luxury travel
has expended with 10 offices in UK. The travel agency has attracted the attention of several
other agencies such as Thomas Cook and The Travel Network Group. Thomas Cook being a
travel agency itself has a wide network and a large customer base, whereas The Travel Network
Group is the leading travel chain in UK currently. Both the companies have suggested Myla to
join with them in order to grow and expand (Minca and Oakes, 2011). With the heavy
competition in the market the decision to join with one of the leading agency will be beneficial
for the company. It will give a competitive to the company over its competitors in the market.
Myla travels being a budding company will need the guidance and large network to expand
globally and it can achieve this by supporting a known brand in the same market.
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Thomas Cook is a leading agency in the market which operates in various countries and
cities. It has large number of stores across the globe which has now become a challenge for the
agency with the inflation and rise in prices to operate them at profitable level (Blackman and
Benson, 2010). The Thomas Cook stores in small and regional places are becoming difficult to
operate and earn profits as it has limited number of customers in such places and with increasing
use of digital media physical presence of a store is not much required. However, The Travel
Network Group is the largest network of commercial businesses having over 200 business
partners and more than 800 independent travel agents (Scott, Peeters and Gössling, 2010). The
company facilitates beneficial solution between the agencies providing various services and
customers which enables the travel agencies to operate with high profits. To attract the customers
all travel agencies are providing packages such as, ecotourism, rural tourism, adventure tourism,
culinary tourism, etc. by adopting new and contemporary trends in tourism. They use latest
techniques such as digital media and social network to promote the business activities amongst
customers and clients. It has a strong brand image and corporate value which attracts more
customers and clients for the company. With expanding to a large number of stores operating
with profits all over, the company group promotes loyalty and trust in the customers increasing
the customer base. Hence, for Myla Travel to join consortia will be a better option as per the
current situations (Pearce and et.al, 2013).
4.2 Likely consequences of businesses failing to respond to market changes
The ever changing environment of the businesses organisation needs to be adapted by the
companies in order to maintain the position in the market and expand in long term. A travel
agency relies on the technique of mouth marketing to a large extend and thus to maintain a
strong brand image is necessary for the company to maintain the position in the market. Being
associated with a controversial brand can harm the corporate image of the company also
(Wearing and McGehee, 2013). The companies needs to plan flexible strategies in order to
include the changes as and when required. In case business does not respond to the change in an
appropriate manner, it can lead to the downfall for the firm. Due to such consequences, the
agency Myla Travel needs to make a proper decision regarding choosing the appropriate
company to support. The agency has to weigh all the pros and cons for both the agencies in order
to ascertain the right choice for the business to collaborate with for the long term (Lamsfus and
et.al, 2013).
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The failure to respond properly to the market changes by Thomas Cook has resulted in
the closing of agency stores in a large number resulting in devaluing the brand image of the firm
(5 key issues facing travel and tourism, 2017.). If a company has to shut down its stores due to
any reason in such a large number it creates an image of the company that it starting of the
downfall for the firm. This will affect the customer base and revenue of the company in the long
run. Whereas, the Travel Network Group succeed in responding to the market changes in a way
to maintain the position in the market as well and the brand image (Current Issues in Travel and
Tourism: An Examination of the State of Oklahoma, 2017). Therefore, to opt the suitable
company in all aspects such as network area, customer base, clients, brand image, strategies and
future opportunities is a crucial decision as it can affect the travel agency in either negative or
positive way (5 Problems travel managers face... and how a travel management company can
help fix them, 2017.).
CONCLUSION
In the above report, the issues and their solutions are described for the travel and tourism
industry. In the current situation the issues and the factors which drives the changes pertaining to
the tourism sector in UK are analysed through various methods and approaches. These factors
affect the working of the whole industry and individual businesses. The trends and changes that
guide the tourism market are evaluated using various techniques and approaches. The issues
related to this sector due to recent changes are explained for the tour operator company in UK. A
few aviation companies are also evaluated for the response to the changes in the market and
developing strategies accordingly to cope up with it. The British aviation company International
Airline Group as well as its forming companies British Airways and Iberia are taken as an
example for explanation of the issues and strategy development techniques in the travel and
tourism sector. Thus the mentioned companies provide an overview for the impact of market
conditions and changes in it on the individual business of tourism industry.
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