Tourism's Impact on Global Economy

This assignment requires an analysis of tourism's role within the global economy. Students must examine the multifaceted impacts of tourism, including economic, social, and environmental consequences. The provided resources encompass scholarly articles and online publications that delve into various aspects of tourism, such as sustainable practices, volunteer tourism, dark tourism, and the influence of emerging markets. The analysis should consider current trends and future prospects within the global tourism industry.

Contemporary Issues in Travel and
Tourism
1

Table of Contents
INTRODUCTION ...............................................................................................................................3
TASK 1.................................................................................................................................................3
AC 1.1 Issues currently driving change in travel and tourism sector for UK .................................3
AC 1.2 Different current issues with respect to the Middle East and North Africa........................4
TASK 2.................................................................................................................................................5
TASK 3 ................................................................................................................................................5
AC 3.1 Analysis of ways in which International Airline Group (IAG) could respond to change. . 5
AC 3.2 Strategies for British Airways (BA) and Vueling for respond to change............................7
AC 3.3 Justification for the strategies .............................................................................................8
Task 4....................................................................................................................................................9
AC 4.1 Analyse the impact of issues and trends..............................................................................9
AC 4.2 The consequences of business failing to respond the market change.................................9
Conclusion..........................................................................................................................................10
References...........................................................................................................................................11
2

INTRODUCTION
Tourism is the activity in which people travel and stay outside for business
purpose or leisure from their usual environment. Tourism is competitive and dynamic
industry that require ability to see constantly changing customers' needs and desires,
as per the customer satisfaction, safety and security with enjoy are particularly the
main purpose of tourism businesses. Tourism concludes a wide variety of sectors that
provide diverse product and services such as transportation, travel services, recreation
and entertainment, accommodations and food and beverages services etc. to visitors
(Pomering, Noble and Johnson, 2011).
In the report, as per the case, to achieve the customers' requirement, there are
many trends and current issues investigated to understand the impacts of changes and
how to respond to changes in travel and tourism. The file also includes the research
skills(internal and external analysis) within the travel and tourism business which is
developed by the learner for understanding the emerging tourism markets.
TASK 1
AC 1.1 Issues currently driving change in travel and tourism sector for UK
Travel and tourism industries are taken as one of the most growing industry as it provides
various services to the individual for spending their time properly. There are various factors which
attract people to join these industries for trips and tours. With some positiveness, there are some
issues also which affects the working of these companies (Moutinho, 2011). Economic, political,
social, legal, etc changes impacts negatively on the progress and success of the travel and tourism
industries. From the world's best destinations, UK is one of the most popular. People like to visit it
due to its beautiful, historical and attractive monuments, castles, libraries and many more. The
travel and tourism sector is enhancing day by day due to its high quality services and tourism
products (Connell, 2013). Four most popular and famous destinations of UK includes France,
Wales, London and Scotland. From all of these, Scotland is one of the most attractive and beautiful
place. However, with the huge naturalness and beauty, there exists various issues which are driving
changes in the sector of travel and tourism. These issues are explained below: Enhancing need of security: Due to terrorism and various attacks, requirement of security
is continuously increasing. Individuals like to visit those places only where they feel they
3

are fully secure and safe. So it becomes essential for the travel and tourism sector to provide
proper and effective facilities to the travellers with strict security. They need to spend money
on CCTV cameras, healthy and hygienic food, necessary vaccination, high quality services,
etc. The issue of increasing terrorism is making travel and tourism sector to make
appropriate changes into its functioning (Spenceley, 2012). Technology: This is one of the major cause of driving change in the travel and tourism
sector of UK. With the changing and updating techniques, companies have to change their
software and systems for providing proper and effective facilities to the customers. Due to
enhancing use of technologies, travel and tourism sector gets an opportunity to increase their
connectivity with the different nations and their people. On the other hand, travel industry is
using advanced techniques for providing high security to the people (Lyons and et.al., 2012).
 Emergence of new market: In present, the major emerging markets with the changes in
demand includes budget cursing, the international wedding market, all-inclusive holiday
concept, travelling for one' health, the eco-tourism, No-Frills airline travel and many more.
All these factors are impacting on the travel spending and investments. Various companies
are started to outpace their developed market counterparts for developing affluent
households (How emerging market growth is changing tourism, 2016).
AC 1.2 Different current issues with respect to the Middle East and North Africa
Travel and tourism industry is contributing nations in their development and progress. This
sector is providing employment to the large number of individuals, informing outsiders about the
glory of nations, contributing into the economic development of the country and many more. Along
with this, tourism sector is fulfilling its responsibility by providing high quality services with proper
safety and security (Crooks and et.al., 2011).
With respect to the Middle East and North Africa, there travel and tourism industries are
developing and recovering fast with the changing time. As per the research og United Nations
World Tourism Organisation (UNWTO), travel and tourism sector of both Middle East and North
Africa was at declining stage from last four years which is not increasing and developing with 4%
respectively (Pritchard, Morgan and Ateljevic, 2011). In present time, approximate 60 million
international travellers are visiting Middle East which represents that travel industry of the nations
has tripled the growth in less than 10 years. However, there are various issues which are faced by
both the countries regarding the tourism. These issues are explained below: Issue related to the climate change: It is essential for the countries to have moderate and
familiar climate for attracting more customers to visit their tourist destinations. If the climate
4

is very hot then in such case, tourists do not like to visit as they feel hectic and irritating
while travelling from one place to the another. In contrast to it, if the climate of the nations
is very rainy or cold then it becomes people to visit and enjoy the locations properly. It is
one of the major issue which affects the tourism of both Middle East and North Africa
(Cohen and Cohen, 2012). Terrorism: Increasing attacks make people to restrict themselves for visiting such places
which are not safe and secure. For example, attacks by the Islamic State Groups in North
Africa and Middle East has affected their tourism a lot. Along with this, sudden attack in
Tunisia, North Africa has decreased its number of visitors as they feel insecure their. It is
essential for travel industry to handle and preventing tourists from such acts. They can
provide proper safety and security measures to the customers while visiting the places. But
still it is not easy to remove the fear of terrorism from the mind of individuals (More tourists
to visit Middle East and North Africa, 2016).
 International Laws and regulations: Travel and tourism industries like British Travel
Agents, TUI group, etc are some major companies which works for the advantage and
development of nations and organisations within this sector. It is essential for them to follow
and obey all the international and national laws and regulations properly for the
development and enhancement of both Middle East and North Africa. On the other hand, it
is responsibility of the tourists also to follow all the rules and regulations properly for
keeping the environment, monuments, culture, etc of the countries safe and secure
(Dickinson, Lumsdon and Robbins, 2011).
TASK 2
Attached in ppt
TASK 3
AC 3.1 Analysis of ways in which International Airline Group (IAG) could respond to change.
IAG is a Spanish-British multinational airline firm which is sixth-largest company in the
world and third largest in UK. Along with this, it is the largest flag carrier airline of UK and Spain
as well. Various services are offered by this firm to the customers like passenger airt transport
services and air freight services. Its subsidiaries are Aer Lingus, Britis Airways, IAG Cargo, Iberia
and Vueling. IAG works according to the changing market, its requirements and demand of the
customers which results to gain it competitive advantages (Mowforth and Munt, 2015).
Along with this above, there are various factors which helps IAG to manage and maintain its
5

leading position not only at national but also at international level. For handling various challenges
and taking appropriate steps, it is essential for the firm to analyse its internal and external
environment properly (Hall, 2013). For this, SWOT analysis of the IAG is as follows:
SWOT:
Strengths Weaknesses
Central holding company structure of the IAG as
it is formed from different mergers and
acquisitions (Falk and et.al., 2012).
Possibility of high loan rates
Possess leading position on the North Atlantic High competitive market
In South Atlantic Iberia is leading airline Not able to achieve sufficient Return on invested
capital (Ladkin, 2011).
The company has made faster and effective
growth with the labour restructuring
British Airways is facing high CASK
The brand strategy of the firm has intrinsic
strength
Weak and low position in Asia Pacific
The domestic market of IAG in Spain is
substantial (Dunkley, Morgan and Westwood,
2011).
British Airways has lack of spare capacity which
keeps the charges high
Opportunities Threats
New Market and expansion in Asia Pacific Changes in the prices
Fleet orders can improve the substantial
efficiency of the airline industry (Desbordes and
Richelieu, 2012).
Increasing fuel prices
Constantly enhancing income level Enhancing labour costs
More effective and closer interaction with the
operating airlines of the IAG will lead to saving
Strong Gulf competition (Murphy, 2013).
PESTEL Analysis:
Political:
 Increasing fuel prices, taxes on food products, labour costs, erc results to affect the financial
status of the firm. With the help of sustainable aviation policy of the government, IAG can contribute in
keeping the environment safe and pollution free. This will help the firm in improving its
image in front of tourists (Hall and Page, 2014).
Economic:
 Euro is more powerful in front of pound which is one of the major factor for the
enhancement and progress of the IAG.
6

 Inflation rate also affects the performance of the IAG (Cohen, Higham and Cavaliere, 2011).
Social:
 Company gives more emphasis to the customer satisfaction by offering them quality
services as per the need and expectations. IAG conducts market research, surveys, etc for identifing the changing needs and
expectations of the users. This help it in developing appropriate strategies for responding
effectively to the market change.
Technological:
 IAG uses online website so that customers can book their tickets, holiday trips or tours
easily (Carlisle and et.al., 2013).
 It uses ERP, CRM, etc systems into the working environment for improving the performance
and work efficiency of the employees. This results to increase the productivity of innovative
and creative services for the users.
AC 3.2 Strategies for British Airways (BA) and Vueling for respond to change
For the growth and progress, IAG needs to face the challenges in effective manner. Some
specific strategies are designed by BA and Vueling for responding the changes occurring in aviation
industry positively. These strategies are as follows:
Strategies of BA:
It is one of the famous airline in UK and largest flag carrier on the basis of the fleet size. The
company posses talented and skilled employees who gives effective productive services to the
customers of the various countries. Various changes are taken place in travel and tourism sector and
for responding to these changes, company is using different strategies. One of the strategy is of
sustainable aviation (Stone, 2012). Company is changing and improving the engine of its flights for
reducing the emission of CO2. This is for keeping the environment of the countries safe, pollution
free and clean. This helps in keeping the people away from any type of disease or infection which
causes due to the water and air pollution. Along with this, company updates its techniques time to
time for making the work more effective and efficient. It provides various techniques to the
customers for booking their tickets, comparing the prices with other flights, etc. On the other hand,
latest and effective technologies are also used by the firm like Enterprise, Resource Planning,
Customer Relationship Model, etc. All these strategies leads to improve and enhance the
performance, market position, brand reputation and profitability of the firm (Weaver, 2011).
Strategies for Vueling:
With respect to the global market and giving a strong competition to it, this firm uses'
7

product and market development strategies. With the help of it,Vueling expands its operations and
business as well. By delivering quality and innovative services to the passengers, airline tries to
attract more customers and making good image in front of them. Proper safety and security of the
travellers with hygienic and delicious food firm responds to the present changes in the aviation
industry. While developing services and tourism products, Vueling gives emphasis to the needs and
expectations of the people. This results to increase the satisfaction level of the individuals by
fulfilling their demands and wants (Wearing and McGehee, 2013).
AC 3.3 Justification for the strategies
The strategies used by both the airline industry of IAG are effective and appropriate.
Justification for strategies of BA:
With the help of sustainable aviation and technological strategies, BA is getting profitability and
popularity. The company is continuously increasing its sales and customer relationship. Policy of
sustainable environment is creating goodwill and reputation of the company among the society and
nation. Due to this, BA is getting recognition at international level among the diverse customers
(Kang and et.al., 2012). In addition, this strategy of the BA is helping it in making good and
effective image in front of the UK government. On the other hand, with the help of technological
strategy BA is making its services effective for the customers. Due to this, people like to fly with
BA as they get easy and simple access to the techniques. Along with this, use of techniques in
internal environment of the company helps employees in improving their performance and work
efficiency. It provides workers an opportunity to improve the quality of services and tourism
products (Jaafar and et.al., 2011).
Justification for strategies of Vueling:
Both the strategies of this airline industry are effective and proper. Due to the appropriate
use of product and market development strategy, Vueling is one of the leading company in famous
among the people. With the help of this strategy, comp-any is providing effective services to the
customers and contributing in the success of IAG. Apparently, there are some restrictions present in
the form of taxes which works as barrier for the Vueling. Changing policies and practices by the
government, affects the demand of tickets. This results to affect the innovative and effective
strategy of the company (Brent Ritchie, Wing Sun Tung and Ritchie, 2011).
The focus of both the airline company is on customer satisfaction and due to this, they are
giving emphasis to their demands, expectations and needs. Both the companies are contributing in
the success and progress of the IAG.
8

TASK 4
AC 4.1 Analyse the impact of issues and trends
As per the scene, I m working in the Myla travel independent travel agency in luxury travel
10 offices in UK. The major issues which impact on changes on sector structure such as merger,
acquisition, liquidation, formation of consortia etc. business activities.
Imapct of the issues on Myla travel:
Myla is the independent travel agencies in Luxury travel which have 10 offices in UK. The
success of the company has attracted the attention of the multiple travel agency. The Thomas cook
has showed the interest in expanding in their business operations. The travel network group is also
the in the race to expand their operations with the Myla travel (Mowforth and Munt, 2015). The
director of the Myla have received the invitations to join the travel network group which is currently
the largest UK travel consortia. If Myla focuses on undertaking the merger scheme then they can
integrate their operations with Travel network group. With this, the company can expand their
market share in the market. The Myla will also focus to understand the business practices which are
used by the Travel Network Group (Ladkin, 2011).
Impact of the issues on Thomas cook:
Thomas cook has also given bad impact due to their high fuel price. This will offer high the
price of ticket to the customers. The company also cannot offer the new products which have to
come according to the age of 21st century So this the company is facing to close their stores. The
another way of decline, the company has bad management decision which company can take over
the past five years. Earlier this, the company also had bad decisions regarding not to sell their under
performed franchises business (Desbordes and Richelieu, 2012).
Impact of the issues on Travel Network Group:
If the Travel Network Group(TNG) is able to merge with Myla Travel, then the TNG group
and Myla both will get immense profit. They will provide better or more benefits which will make
major employer in UK. Both will increase the market share due to dealing with the high luxurious
product and premium service packages to the youngsters and old age people (Murphy, 2013).
AC 4.2 The consequences of business failing to respond the market change
In the new era, the environment is more dynamic and competitive, so the company have to
respond the market changes. If Myla group will not able to respond the changes then will have to
face decline in the sales of tickets and decrease the revenue of the company. The individuals will
attract more through the new trends if this must not avail the company then the customers will not
satisfy. So the company have to take decisions after analysing the past data which integrate the
9

current and future trends (Cohen, Higham and Cavaliere, 2011).
For Thomas cook, it is important to analyse and respond towards the changes available in
the market. If they don't adopt the current changes then they have to stop their operations in
different outlets. Through this, it is better for Thomas Cook to merge their activity with Travel
Network Group. It will increase the customer's satisfaction due to premium tour packages which
furnish to their service users. The company increases the employment due to merger, acquisition
structure is adopted by the company. The competitors face more competition due to high quality
product and services provided to the customers by both the company (Wearing and McGehee,
2013).
Travel Network group, it is failing in the market place due to not adopting the current trends.
With the market research, the company will analyse the competitors with new trends. Through this
the travel network Group strengthen their relationship with customers. By adopting the research, the
company can understand the activities and facilities which are popular and increase the customers
satisfactions. Not applying a flexible approach to changes in the market is going to make the
business get behind on technology advancement as a result the company will not progress and stay
in market. These will lead business vulnerable in case of recession or crisis. The bad management
decisions for current changes also suffer the company liquidation or formation of consortia (Carlisle
and et.al., 2013).
CONCLUSION
From the above study, it is concluded that travel and tourism industry is facing various
issues due to the changing customer requirements. Companies need to work according to the needs
of the travellers and changing market, if they want to survive in the competition. Along with this,
strategies uses by the British Airways and Vueling are effective and helping them in accomplishing
their objective of increasing customer satisfaction. On the other hand, Cox and Kings can expand its
business by working in the niche market of UK. The current trends will help firm in gaining
competitive advantages.
10

REFERENCES
Books and Journals
Brent Ritchie, J.R., Wing Sun Tung, V. and Ritchie, R.J., 2011. Tourism experience management
research: Emergence, evolution and future directions. International Journal of
Contemporary Hospitality Management. 23(4). pp.419-438.
Carlisle, S. and et.al., 2013. Supporting innovation for tourism development through multi-
stakeholder approaches: Experiences from Africa. Tourism Management. 35. pp.59-69.
Coghlan, A. and Gooch, M., 2011. Applying a transformative learning framework to volunteer
tourism. Journal of Sustainable Tourism. 19(6). pp.713-728.
Cohen, E. and Cohen, S.A., 2012. Current sociological theories and issues in tourism. Annals of
Tourism Research. 39(4). pp.2177-2202.
Cohen, S.A., Higham, J.E. and Cavaliere, C.T., 2011. Binge flying: Behavioural addiction and
climate change. Annals of Tourism Research. 38(3). pp.1070-1089.
Connell, J., 2013. Contemporary medical tourism: Conceptualisation, culture and
commodification. Tourism Management. 34. pp.1-13.
Crooks, V.A. and et.al.,., 2011. Promoting medical tourism to India: Messages, images, and the
marketing of international patient travel. Social Science & Medicine. 72(5). pp.726-732.
Dasgupta, D., 2011. Tourism marketing. Pearson Education, Inc, publishing as Prentice Hall.
Desbordes, M. and Richelieu, A. eds., 2012. Global sport marketing: Contemporary issues and
practice. Routledge.
Dickinson, J.E., Lumsdon, L.M. and Robbins, D., 2011. Slow travel: Issues for tourism and climate
change. Journal of Sustainable Tourism. 19(3), pp.281-300.
Dunkley, R., Morgan, N. and Westwood, S., 2011. Visiting the trenches: Exploring meanings and
motivations in battlefield tourism. Tourism management. 32(4). pp.860-868.
Falk, J.H. and et.al., 2012. Travel and learning: A neglected tourism research area. Annals of
Tourism Research. 39(2). pp.908-927.
Gössling, S. and et.al., 2012. Consumer behaviour and demand response of tourists to climate
change.Annals of Tourism Research. 39(1). pp.36-58.
Hall, C.M., 2013. Wine, food, and tourism marketing. Routledge.
Hall, M.C. and Page, S.J., 2014. The geography of tourism and recreation: Environment, place and
space. Routledge.
Hannam, K., Butler, G. and Paris, C.M., 2014. Developments and key issues in tourism
mobilities. Annals of Tourism Research. 44. pp.171-185.
11

Higham, J.E. and Cohen, S.A., 2011. Canary in the coalmine: Norwegian attitudes towards climate
change and extreme long-haul air travel to Aotearoa/New Zealand. Tourism Management.
32(1). pp.98-105.
Jaafar, M. and et.al., 2011. Entrepreneurship in the tourism industry: Issues in developing
countries.International Journal of Hospitality Management. 30(4). pp.827-835.
Kang, E.J. and et.al., 2012. Benefits of visiting a ‘dark tourism’site: The case of the Jeju April 3rd
Peace Park, Korea. Tourism Management. 33(2). pp.257-265.
Korstanje, M.E., 2011. Why risk why now? Conceptual problems around the risk perception in
tourism industry. RBTur. 5(1).
Ladkin, A., 2011. Exploring tourism labor. Annals of Tourism Research. 38(3). pp.1135-1155.
Lew, A.A., 2011. Tourism's role in the global economy. Tourism Geographies. 13(1). pp.148-151.
Lyons, K. and et.al., 2012. Gap year volunteer tourism: Myths of global citizenship?. Annals of
tourism research. 39(1). pp.361-378.
Moutinho, L. ed., 2011. Strategic management in tourism. CABI.
Mowforth, M. and Munt, I., 2015. Tourism and sustainability: Development, globalisation and new
tourism in the third world. Routledge.
Murphy, P.E., 2013. Tourism: A Community Approach (RLE Tourism). Routledge.
Page, S.J., 2014. Tourism management. Routledge.
Pomering, A., Noble, G. and Johnson, L.W., 2011. Conceptualising a contemporary marketing mix
for sustainable tourism. Journal of Sustainable Tourism. 19(8). pp.953-969.
Pritchard, A., Morgan, N. and Ateljevic, I., 2011. Hopeful tourism: A new transformative
perspective. Annals of Tourism Research. 38(3). pp.941-963.
Rogerson, C.M., 2013. Tourism, small firm development and empowerment in post-apartheid South
Africa. Small firms in tourism. pp.13.
Spenceley, A., 2012. Responsible tourism: Critical issues for conservation and development.
Routledge.
Stone, P.R., 2012. Dark tourism and significant other death: Towards a model of mortality
mediation. Annals of Tourism Research. 39(3). pp.1565-1587.
Wearing, S. and McGehee, N.G., 2013. Volunteer tourism: A review. Tourism Management. 38.
pp.120-130.
Weaver, D., 2011. Can sustainable tourism survive climate change?. Journal of sustainable Tourism.
19(1). pp.5-15.
Online
12

How emerging market growth is changing tourism. 2016. [Online]. Available Through:
<https://www.weforum.org/agenda/2015/05/how-emerging-market-growth-is-changing-
tourism/>. [Accessed on 13th June 2016]
More tourists to visit Middle East and North Africa. 2016. [Online]. Available Through:
<http://www.star2.com/travel/africa/2016/03/10/more-tourists-to-visit-middle-east-and-
north-africa/>. [Accessed on 13th June 2016]
UK Tourism Statistics. 2015. [PDF]. Available Through:
<http://www.tourismalliance.com/downloads/TA_369_395.pdf>. [Accessed on 13th June
2016]
13