Tour Operations Management: Trends, Strategies, and Analysis

This report provides a comprehensive analysis of tour operations management, focusing on the role of tour operators in creating travel packages, particularly for diverse customer segments. It examines the impact of current trends and developments, such as e-commerce, the expansion of the cruise market, and the increasing importance of environmental awareness, on the industry. The report delves into the time-scales involved in developing holiday packages, specifically for Chinese students traveling from London to Paris, outlining the stages from market research to marketing. It also explores the suitability of different contracting methods for various holiday components, including hotels, travel agencies, and suppliers. Furthermore, the report analyzes the strategic and tactical decisions made by tour operators, comparing different types of operators and their approaches in various situations to gain a competitive advantage. The report also includes tables which provide a comparison of different parameters across various tour operator types.

Tour Operations
Management
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 The effects of current and recent trends and developments of the tour operator's industry. .3
TASK 2............................................................................................................................................5
2.1 The time-scales involved in developing this holiday.............................................................5
2.2 The suitability of different methods of contracting for different components of holidays....6
2.3 Calculate selling price of the tour..........................................................................................7
TASK 3............................................................................................................................................8
3.1 The planning decisions taken for the design of a selected brochure (350)............................8
3.2 Suitability of alternatives to a traditional printed brochure...................................................9
3.3 Suitability of different methods of distribution used to sell their holidays and recommend
....................................................................................................................................................10
most appropriate for your tour package ...................................................................................10
TASK 4..........................................................................................................................................11
4.1 Strategical decisions made by different types of tour operators .........................................11
4.2 Compare the tactical decisions that could be taken by a selected tour operators in different
situations ...................................................................................................................................12
CONCLUSION .............................................................................................................................13
REFERENCES..............................................................................................................................14
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INTRODUCTION
In order to create different travel and holiday packages for different segment customers
tour operators plays significant role. The forefront of all the travel operators is that they often
look for new destinations so that their customers can travel and enjoy their luxurious time period.
In addition to this, in the current scenario tour operator mainly ensure assessing new travel and
holiday packages to fit the dynamic responsibility of visitant and travellers. Furthermore, the tour
operators incorporate various travel services and activities related within booking of airline,
hotels, food and beverage services, site seeing services etc. the leading company within the travel
and tourism sector is Thomas Cook that basically provide different holiday services as well as
packages to all the segment customers (Thomas cook. 2015). The establishment function its
operations in the hospitality and tourism industry that is view as the growing service business
that contribute the economy of UK.
The present report focuses on understanding different types of tour operator industry
within the travel and tourism sector. It also measures the effect of trends and development on the
tour operators Industry. The report also stresses in understanding the different stages that are
involved in developing holiday packages as well as different methods of contracting different
components of the holiday that is suppliers and vendors. Lastly, the report also analyse the
strategic and tactical decisions that is being made by the tour operator in the different situation to
gain competitive advantage.
TASK 1
1.1 The effects of current and recent trends and developments of the tour operator's industry
Tour agents are the one that set up the itinerary or the travel guidebook for their
customers those who mainly prefer to visits different destination (Luo and Girazova, 2014). The
itinerary consists of all the details and information regarding the travel package that is flight
booking, accommodation information, information related with site seeing etc. there are different
types of operators within the UK that mainly serves the requirement of different visitors and
travellers that is specialist operators, inbound operator, outbound operators etc. Inbound tour
operators that the one that mainly renders services to the visitors and travellers that come from
other region within the UK. On the other hand, outbound tour operators are the one that often
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render travel services to those customers those who want to travel other destination from their
home country (Bainbridge, 2010). Thomas Cook is the primal tour operators in operation in
London, UK that provide assorted holiday packages or travelling plan to their customers.
It has been analysed that there are various trends and improvement within the travel and
tourism aspect that need to be considered by the tour operator so that they can render leisure
services to their customers. The recent trends within the travel and tourism include-
 Emergence of E-commerce: In the technical era, e-commerce plays significant role in
the development of travel and tourism industry as with the help of e-commerce tour
operators can set up their business activities on the online platform (Swarbrooke and
Page, 2012). With the help of this, customers can easily book their travel plan as well as
this will also support the customers in knowing the detail of the travel plan that they have
selected. Despite of this, enabling e-commerce transaction also negatively effect the
travel and tourism industry as it may results in increasing the hacking activity as well as it
also results in some security issues.
 Expansion of cruise market: Another rising trends within the travel and tourism industry
is expansion of cruising activities within the travel packages. Now a days customers and
travellers mainly prefer to travel in the cruise as it results in providing wide range of
services to the travellers and visitants (Witt, Brooke and Buckley, 2013). Therefore, it is
said that increase of cruise market will impact the operations of Thomas Cook as they
will modify their travel package accordant with the needs and requirement of travellers.
 Environmental awareness of tour operators: In the present scenario, tour operators are
focusing on creating the travel package that mainly render concern towards increasing the
environmental perspectives. For this, tour operators within the industry must focuses on
eco-tourism packages so that they can reduce the rate of carbon emission. For example,
the tour operator within the industry must focuses on exploring the natural and
environmental destination that are not explored by the visitors (Baddeley and Font,
2011). Thus, the increasing awareness regarding the environment will impact the Thomas
Cook activities as they will enable green tourism that concentrate on raising the
information and experience regarding the environmental destinations.
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TASK 2
2.1 The time-scales involved in developing this holiday
According to the scenario, Thomas Cook is focusing on developing the holiday and sight
seeing package for Chinese student from London, UK to Paris, France. Therefore, tour operator
will focus on devising the travel plan for the summer vacation in August 2018. the proposed size
is 15 student that will go to sight seeing from London, UK to Paris and France (Evans,
Stonehouse and Campbell, 2012). There are different stages that need to be considered by the
Thomas Cook for developing the holiday that include-1. Market Research: The foremost step in developing the holiday package for Chinese
student is conducting market research related with the destination so that operator can
research regarding the sights that must be visits by the Chinese student during their
summer holiday.2. Planning and scheduling: After researching the market or destination Thomas Cook can
plan and schedule all the activities related with travelling plan that is where student will
travel first, what places they will visits during the five day stay etc. this planning will act
as the blueprint for the student.3. Forecasting the budget: After planning Tour operator will predict or forecast the overall
budget that mainly consist of different services such as flight service, accommodation,
food and beverages, transportation etc. forecasting budget will support them in estimating
the overall budget (Page, 2014). If the budget is above their limit than they will change or
review the amount and make affordable budget that will prefer by the student.4. Devising tour packages: After forecasting the budget operator will devise the tour
packages for the student for five days.
5. Marketing the holiday package: The last step in developing the holiday package is
marketing or promoting the package with considering all the elements of marketing
mixes so that they can easily serve the Chinese student (Brent Ritchie, Wing Sun Tung
and JB Ritchie, 2011).
Activities related with developing the holiday packages Time scale
Market research 1 month
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Planning and scheduling 2 months
Forecasting the budget 1 month
Devising tour packages 1.5 months
Marketing the holiday packages 1 month
2.2 The suitability of different methods of contracting for different components of holidays
There are different components of the holiday that is flight booking, hotels, attractions,
transportation etc. that need to be in contract with the tour operators (Mensah and Dei Mensah,
2013). Thus, Thomas Cook use various methods of contracting to be contact with the various
components of holidays that is-1. Contracting with hotels and resorts: For contracting with the different hotels and resorts
in Paris and France for Chinese student so that they may have pleasant and leisure stay.
Thus, Thomas Cook basically focuses on the written communication or communication
via email to get all the necessary information regarding their availability of rooms and the
overall cost of the room for the single night (Hall, Timothy and Duval, 2012).
Contracting via email is consider as the vital option that will support them in contracting
with the hotel and resorts. Through email they can also book or reserve the hotel rooms
for Chinese student. It can be evaluated that this method is effective because it helps in
delivering the most appropriate and required information. However, it can be argued that
the present method sometimes consumes lots of time and it is one of the major
drawbacks.2. Contracting with travel agencies: In order to contract with the travel agencies Thomas
Cook must focus on signing the written deed regarding the conveyance of visitors and
travellers from one place to another (Grissemann and Stokburger-Sauer, 2012). With the
help of written contract among the travel agencies they can conduct their activities in the
proper manner so that they can deliver quality service to Chinese student during their
airline journey from one destination to another. On the other hand, it is also consider as
an effective method of contracting with the component of holiday. It can be critically
evaluated that this method is appropriate because it supports in increasing sales and
profits of the business enterprise. However, it can be asserted that the use of this results
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can lower down the profit margin of company because it encourages profit sharing
between travel agent and tour operator.
3. Contract to suppliers or vendors: Under this Thomas Cook basically select some
provider that will provide necessary and adequate information accompanying to vendors.
They mainly focuses on rendering or providing different information related with the
sight seeing and attractive information regarding the destination (Xiang, Magnini and
Fesenmaier, 2015). For instance, tour operators are adjoining one by one so that they can
easily provide good quality of services to visitant at various locations. However, high
discount can also be offered to tourists in some specific occasion. It represent that, tour
operators have been in the contract with the other supplier and vendors so that they can
combine their activities in order to meet the requirement and different expectations of
visitors in the proper manner (Schuckert, Liu and Law, 2015). For instance, Thomas
Cook must contract with the network partner in France so that Chinese students can
easily view the country locations.
Parameters Outbound
operators
Inbound
operators
Domestic
operators
Specialist
operators
Operational area It involves those
operators who
offer different
types of products
and services to
people who are
seeking to travel
other nations.
It consists of tour
operators which
provide services
within the
country. Here,
services linked
with food and
accommodations
are provided to
them.
The services
provided by these
operators are
restricted to
boundaries within
a nation.
These are the tour
operators who
provide services
and to customers
on the basis of
their changing
need and demand
Packages
operated
Regular and ad
hoc
Regular and ad
hoc
Regular and ad
hoc
Only regular
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Example of tour
operator
Thomas cook and
Thomson
Evans Evans
Tours company
Haven Holidays Cox and Kings
Products offered Summer sun,
winter sun, ski,
long haul, short
breaks etc. are the
major services
provided by these
tour operators.
Here services
offered are linked
with Heritage
tours, self tours
etc.
Different type of
Holiday tours
Adventures and
according to the
interest and
hobbies of the
customers.
2.3 Calculate selling price of the tour
Holiday packet framed by tour operator mainly belong of various aspects such as
conveyance services, hotel booking charges, site seeing charges and several other expenses.
Thus, the tour operators uses different pricing strategies so that they can easily recover their cost
and expenditure and earn required or minimum profit percentage (Cheng and et.al., 2011). The
pricing strategies mainly include cost plus leadership, skimming or penetration pricing strategies.
All these monetary strategies are mainly adopted so that they can attain the overall goals and
recover the expenses as well as cost regarding creating the holiday packages. According to the
given scenario in France St Michelle Hotel will cost 60 euro for a twin room that will be divided
between the 2 students. For this aim, they would be require 8 rooms so that all 15 students can be
properly adjusted in the rooms (Ashworth and Page, 2011). The total cost for the hotel booking
will be around 381.36 pounds. Despite of this, supplement for BB is also provided for 10 euros
per person that will cost around 119.25 pounds. While, the surface transportation include 20
luxury coach is for the student that cost around for £1000.
Total cost Per students price
Single room
Twin
room
Hotel
booking
47.67x8=
381.36 25.424 47.67
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Supplement
for BB
7.95x15=
119.25 7.95
Surface
transportation
1000
Guide 200
TOTAL 1700.61
Profit @ 10
%
170.61
Selling price 1870 124.666667
Note: Economic value of euro has been regenerate into British pound for calculating the cost in
an effective manner.
1. 60 euro=47.67 pound
2. 10 euro=7.95
In addition to this, the company has also concentrate on keeping 10% profit margin that is
consider as effectual for them for recovering the cost that has been incurred while devising the
travel or holiday packages. Furthermore, the holiday package also indicate that St. Michelle
Hotel will charge around 1000pounds for the conveyance this would include 20 seater luxurious
coach that include two drivers, fuel and ferry taxes (Leung and et.al., 2013). Moreover, £200 is
also being charged from the student to pay for the guide that will assists the Chinese student
during their stay so that he can support them in visiting the attractive place and areas within the
Paris. Therefore, it has been stated that calculating the pricing or holiday cost would assist
students to know about the prices that travel operator is charging form them.
TASK 3
3.1 The planning decisions taken for the design of a selected brochure (350)
The tour operators can use varied effective methods and techniques to stimulate
customers to take tour packages from London UK to Paris France. There are contrasting
methods that can be used by entity to market its holiday package (Thomas, Shaw and Page, 2011
). Such as advertisement can be given on travel magazine, ad in newspapers, social media
marketing etc. Further, company can use the concept of virtual tour to give real example of their
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proposed services with the help of audio and video elements. Further, brochure is another
effective method that can be adopted by entity. The brochure is attractive way that help in listing
the products and services that will be provided to customers along with other important
information. However, there are various aspects that must be considered while designing the
brochures. Also, the mode of distribution of brochure must also be determined. Such as, it can be
distributed with the help of online portals or through the agents (Mok, Sparks and Kadampully,
2013). Other than this, the important decision that must be taken by entity are as follows:
 Ascertaining the problems that can affect the planning decisions: There are varied
issues that have direct impact on designing of brochure. They must be ascertained first
such as, details about target consumers, objective of company and intent of conveyed
information etc.
 Format of the brochure: The marketing needs of customers, brand image of company,
strategy of competitors and other factors must be considered while deciding the format of
brochure (Kavoura and Stavrianea, 2014). The format should be effectively selected so
that it properly assemble all the information regarding entity, time duration of tour,
information about holiday destination etc. in addition to this aspect, entity is required to
provide information about prices, discount, applicable conditions ad features of services
etc.
 Budget: The brochure must be designed as per the budget decided by company. Since,
tour is offered to students at budgeted price entity should cut down the expenditure on
brochure (Dolnicar and Ring, 2014). Therefore, too much expense must not be done on
designing of brochure.
 Time frame: The time duration must be decided for designing brochure. Such as, it must
not take more than 4 weeks for preparing brochure.
 Distribution: The mode of distribution should be selected in such a way that maximum
number of customers could be attracted in less time. Therefore, Thomas Cook should use
internet as a platform to target maximum number of customers (Huang and et.al., 2013).
3.2 Suitability of alternatives to a traditional printed brochure
The traditional type of brochure was on which was physically distributed by the travel
agent to prospective customers. It further involved high cost of printing and publishing.
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However, with the progressive modification and development in technology, there are varied
modern techniques that can be used to design modern brochure (Morrison, 2013). With the
progress of internet technology, entrepreneurs using traditional brochures are replacing it with e-
brochure. This will further help in keeping align with present modern online customers. There
are ample number of advantages of e-brochure such as they are cost effective. They are flexible
and can be modified as per the needs of market. Further, e-brochure are environmentally safe as
they reduce the wastage of paper as it occur in traditional method. They can be easily
downloaded by customers on their personal computers, cellphone etc. Thereafter, with the help
of graphics and designing e-brochures can be given high quality look. In this respect, Thomas
cook ca use concept of e-brochure which will have destination image, information about offered
product and services etc (Sikdar and Vel, 2010). Further, video brochure can be used by
company which will have beautiful pictures of target destination. With this aspect, customers can
be stimulated to personally visit the holiday spot. The video brochure can be distributed to vast
audience by uploading them on social networking sites , sharing through emails or mobile
applications etc. In addition to this aspect, Youtube, Twitter or Facebook can be used as a
platform to upload the brochure and attract millions of customers at a time. Furthermore, video
brochure consist of both audio and visual elements and thus it will be easy to understand by
potential customers. With this aspect, company can reduce the extra cost that was incurred in
preparing traditional brochure and improve its margin (Jenkins and Schröder, 2013).
3.3 Suitability of different methods of distribution used to sell their holidays and recommend
most appropriate for your tour package
There are wide range of methods that can be used by cited organization for providing its
holiday packages to maximum number of customers. It is important for corporation to use cost
effective method for providing its product to potential buyers. Further, it has been identified that
brochure are recognized as effective method for offering the tour packages developed by Thomas
Cook. Further, along with methods of designing brochure, the mode of distribution has also
changed (Swarbrooke, 2012). In this respect, not only mode of designing has become technology
bound but also distribution is dependent upon use of viable techniques. Therefore, in present
scenario the offering of holiday package of company can be done through online marketing,
direct sales, call centre, m marketing etc. The online marketing will enable marketers to share
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brochure on their official website, brand page developed on social networking sites etc
(Williamson, 2013). While, direct email can be used where brochure can be provided to past or
new customer via email. The direct sales is another method which enable travel agents to provide
printed brochures to customers visiting their office. Thereafter, M marketing will enable
company to provide brochure through the mobile application developed by Thomas Cook
Lignau, 2013) The customers will be able to download brochure on their cellphone. Furthermore,
services of call centres can be obtained that will help entity in spreading the information about
holiday packages to international as well as domestic customer. Other than this, company can
contact past customers through their contact number and provide them details about new
offerings, discount etc. Hence, from the critical assessment of aforementioned information, it has
been identified that it is beneficial for company to use both online and direct methods for
distributing and promoting its holiday package (Wolfe, Hsu and Kang, 2015). It will help in
attracting maximum number of customers and boosting the sales of holiday package.
TASK 4
4.1 Strategical decisions made by different types of tour operators
There are large number of strategical decisions that must be taken by tour operators so as
to achieve the set objectives and goals. They will further provide support for ensuring the overall
success of holiday package. Some of the example of strategic decision are, outlay on varied
activities, choice of suppliers, selection of target market, choice of marketing technique etc
(Holloway, 2009). the determination of selling price, distribution method are also some of the
major strategic decision that a tour operator is required to take. The wrong decision or mistake
on the part of tour operator have direct impact on the sales of holiday package. The future
prospect of company will be dependent upon the efficiency of decisions taken by tour operators
(Laws, 2011). therefore, the major strategic decision that must be taken by him / her are
explained as follows:
 Segmentation, targeting and positioning: It is among the significant strategic decision
that is taken by tour operators which enable them to divide the entire market. The
targeting aspect will help comp any in deciding to whom they want to offer their product.
While the positioning aspect enable company to develop position of their brand in market
( Law, Qi and Buhalis, 2010). Considering the overall objectives and strategic goals of
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company the decision about segmentation, targeting and positioning will be taken by tour
operators.
 Competitive pricing strategy: To sustain the present cut throat competition, it is
important for company to adopt competitive pricing strategy. Therefore, rival pricing
strategy must be considered while deciding the price of tour package. This will further
help in keeping an edge over its rival (Lignau, 2013)
 Developing promotional strategy: In order to attract maximum number of customers
and ensure promotion of tour package, it is important for tour operators to develop
effective, impelling and competitive pricing strategy (Mancini, 2012). Further, unique
promotional strategy can be used which will also help in increasing the promotion of tour
package and improve the profitability of business.
4.2 Compare the tactical decisions that could be taken by a selected tour operators in different
situations
In order to manage the routine functions of business there are large number of tactical
decisions that must be taken by tour operators. They will further ensure smooth flow of
operations and proper functioning of company. Some of the tactical decisions that must be taken
by operator are, conciliation with suppliers of varied services, managing transportation and
accommodation facility etc )(Mancini, 2012). In addition to this aspect, association with varied
stakeholders that are part of entire value chain of offering services to customers related to travel
package as required by them. The major tactical decision that is taken by tour operators is
related with association with suppliers. It is important for them to select the suppliers that
provide quality offerings in affordable prices (Ashworth and Page, 2011). Further, tour operators
are required to take decision about the ways of enhancing customer experience and meeting
their expectations. In addition to this they must determine the methods to solve the complaints
of customers. With all these aspect, the satisfaction level of customers can be enhanced and
positive image of company can be developed in the market. Furthemore, the emerging needs of
buyers must be identified so that changes can be made in the method of providing services,
product quality etc. Further, tour operators are required to make changes in different operational
activities in accordance with market needs, trends and rivals actions (Cheng and et.al., 2011).
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 Discount pricing: The determination of price is important decision that must be taken by
tour operator. Price determine the future sales of holiday package. Here, tour operators
can use fixed price for their holiday package (Hudson and Thal, 2013).. It will enable
company to provide heavy discount to buyers. Further, company will be able to attract
maximum number of buyers and gain competitive advantage in market.
 Seasonal aspect: There are varied types of season that determine the sales of tour
package and impact the pricing decision of company. Such as in peak season company
can charge high prices to improve their margin (Laws, 2011). On the contrast, to
maintain consistency of profit company will charge discounted price in lean season.
Along with this, with the above tactical decisions it has been assessed that discount
pricing of the tourism package would results in attracting the customers towards purchasing their
products and services so that they may effectively meet the leisure and luxurious requirement of
customers. On the contrary to this, with the discount pricing marketing manager of Thomas Cook
must also engage in taking tactical decision related with seasonal pricing of their travel package
so that they can easily meet the requirement of customers.
CONCLUSION
From the above report it is summarizes that activities of tour operator plays vital role in
enhancing their overall performance of travel and tourism industry as it basically outcome in
providing the various services related with the accommodation, flight services etc. that meet the
different leisure and luxurious requirement of the visitors and travellers. Thus, the concluded
report has provide an insight information regarding the recent trends and development within the
tourism industry that impact the activities of tour operators. Thus, with analysing all the
development and trends it support the operator in amending their services accordant with the
trends so that they can have dominant position in the market. In addition to this, it has also
provide an insight knowledge regarding determining various contracting methods that is used by
tour operator for contracting with the various components of the holiday packages. Moreover, it
has also measured tour operator must focuses on developing different promotional brochure for
promoting and marketing their holiday package among the customers visitors so that they must
come to know about the services and packages that are made available by the tour operator.
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Lastly, the report has also summarizes the strategically decisions that are taken by the tour
operator in order to ensure creating successful holiday packages.
15

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