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What Is the Tourism Industry?

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What Is the Tourism Industry? What is the tourism industry? TOURISM IS BIG BUSINESS THE PRODUCT: NSW Tourism is one of the most exciting and progressive NSW has beauty and diversity, offering a wide industries in Australia. Part of the visitor economy, range of experiences for international and tourism is also big business and it impacts on domestic visitors. The State has a lot to sell, from almost every other industry. Total tourism the exciting major events, international conventions, consumption was worth more than $92 billion in big city buzz of Sydney, with its great restaurants, 2008–09 and tourism directly contributed $32.8 shopping and beautiful harbour, to the local billion to Australia’s GDP in that period. flavours and wide open spaces of regional NSW. NSW offers beach holidays; hiking in mountain Tourism is now one of the largest industries in landscapes; Outback journeys; soul-enriching Australia, accounting for 486,200 jobs. The encounters in World Heritage national parks; drive country’s tourism industry has a larger output than: holidays through lush farm regions; inspiring ∙ agriculture, forestry and fishing; conference locations; and visits to quirky towns and ∙ communication services; country cosmopolitan centres. Along the way, ∙ and electricity, gas and water supply. visitors encounter fine food and wine trails, lively festivals, Aboriginal culture, breathtaking In 2008–09, tourism (direct and indirect) contributed landscapes and all kinds of people. $28.7 billion to the NSW economy. Tourism directly employs 4.7% of the NSW workforce, or 160,300 Tourism products in NSW come in many shapes people. In NSW, tourism is larger than: and sizes. Accommodation ranges from five-star ∙ agriculture, forestry and fishing; hotels to boutique bed and breakfasts to trendy ∙ mining; backpacker resorts. There are iconic attractions, ∙ communication services; such as the Sydney Opera House and Harbour ∙ personal and other services; Bridge; adventure activities, such as quad biking, ∙ electricity, gas and water supply; sea kayaking, rainforest tours, dive or surf schools; ∙ and cultural and recreational services. and cultural and wildlife centres, such as museums and galleries, wineries, aquariums, wildlife Source: Tourism Satellite Accounts 2008–09, NSW, Sustainable reserves – and lots, lots more. Tourism Cooperative Research Centre. With all that is on offer, one of the main challenges TOURISM IS EVERYONE’S BUSINESS facing tourism operators is to develop and package Everyone gains from properly managed tourism. tourism products in a way that meets consumer Tourism can be especially important in regional needs, enabling the creation of a viable business. areas because it diversifies the area’s economic NSW is a premier tourism and events destination base and expands the employment market. and this status depends on the creativity and success of the tourism operators, event organisers In its broadest sense, the tourism industry is the and destination managers within it. total of all businesses that directly provide goods or services to facilitate business, pleasure and leisure activities away from the home environment. 4 VOLUME 1: UNDERSTANDINGA GUIDE TO UNDERSTANDING THE TOURISM THE INDUSTRY TOURISM INDUSTRY HANDY HINT Actively seek customer feedback. Feedback tells you what you do well and what could be done better. Use this information to build and improve your business. TOURISM IS EVERYONE’S BUSINESS VISITORS SPEND DOLLARS ON… AND THE INDUSTRY PAYS FOR… WHICH BENEFITS EVERYBODY • Petrol • Administrative expenses • Accountants • Marketers • Advertising & promotion • Architects • Manufacturers • Bakers • Marine dealers Overseas • Transport • Capital assets & replacements • Banks • Mechanics • Commissions • Builders • Newsagents • Entertainment • Entertainment • Bus & car hirers • Nightclubs • Food & beverage • Chambers of Commerce • Petrol stations • Chemists • Pilots • Events • Gas & electricity • Crafts people • Plumbers Interstate • Legal & professional services • Cultural groups • Postal workers • Accommodation • Merchandise • Electricians • Printers & designers • Engineers • Restaurants & cafes • Petrol • Entertainers • Real estate agents • Shopping • Rates & charges • Farmers • Retailers • Rent • Film developers • Shopping centres • Gift shops • Travel agents Local • Meals • Repairs & maintenance • Interpreters • Truckies • Transport • Laundries • Waiters • Others • Wages • Market gardeners • Wineries Tourism businesses such as hotels, airlines and tour operators represent only a small proportion of the people employed in the tourism industry or who benefit from it. As the tourist dollars trickle down they spread throughout the community and the economy in often surprising ways. THE TOURISM SYSTEM Before developing a tourism product, it is useful to understand how the tourism system operates. The diagram shows the components involved. THE TOURISM SYSTEM Consumers People who may go on holidays Marketing/Promotion Travel Experience Research, development, evaluation The experience that people have and consumer communication to travelling to their destination raise awareness and generate sales. Holiday Experience The experience that people have at their destination 5 THE CONSUMER THE HOLIDAY EXPERIENCE The consumer is the most important part of the When consumers decide to take a particular type of tourism system because the consumer is the holiday, they have expectations of the experience reason tourism products and services exist. they will have. This could relate to the quality of Everyone working in tourism must ensure that accommodation, service and food, or the range and the consumer is considered first and foremost cost of activities available, variety of shopping, cafe in all business and planning decisions. and restaurant opening hours. Their satisfaction will be based on how well the holiday met their Consumers spend their money and leisure time initial expectations or exceeded them. in many different ways. If they choose to spend their money on a holiday, they generally begin MARKETING A BUSINESS by setting a budget, deciding on the period of Marketing refers to the multi-faceted process travel and considering the types of activities that any successful business perpetually works they would like to do while away. Then they through. It includes activities such as researching select a destination, decide how they will travel the market, consumers and products; developing there and make reservations accordingly, the business and products; developing the skills of through a travel agent, wholesaler, over the personnel; and promoting, advertising or working internet or directly with a tourism operator. with the media to raise awareness of the product to generate sales. THE TRAVEL EXPERIENCE The travel experience relates to how the consumer Marketing is often described as consisting of travels to the destination and the experiences they four elements, known as the four Ps: product, have along the way. Travel choices include air, car, place, price and promotion. Product refers to the boat, coach, train, motorbike, hiking or a physical attributes of the product, branding and combination of the above. The mode of travel packaging. Place is about distribution – the affects the type of consumer experience, for agencies, channels and institutions used to give example, flying to a destination is a very different consumers easy access to purchase the product. experience to driving. Price must meet both the needs of consumers and the needs of the provider. Promotion is the means When transport options, links and support services by which consumers are made aware of are limited or below standard, the destination often destinations, products or services, to help them suffers. Many issues affect the quality of the travel choose their holiday. Promotion can involve a range experience, including the variety of attractions, of media, including internet, websites, print facilities and accommodation available en route; (magazines, newspapers, brochures, direct-mail), the road quality and signage; and the frequency of television and radio. transport services. 6 VOLUME 1: UNDERSTANDINGA GUIDE TO UNDERSTANDING THE TOURISM THE INDUSTRY TOURISM INDUSTRY HANDY HINT Want to know more? Talk to your tourism manager, your RTO, your industry association or Destination NSW. Look at books and articles on tourism, and check out available TAFE and university courses. CONSUMER DECISION-MAKING Motivation: If the consumer is aware of a The diagram depicts the process consumers work destination, product or service and has a positive through when deciding to take a holiday. It is feeling about it, they are more likely to be motivated important to understand this process because it to visit. influences all stages of the tourism system model, especially marketing and promotion. Planning/decision: Promotional information helps consumers decide how they will travel to their Consumer needs: Going on a holiday provides destination and what they’ll do once they get there. opportunities for people to take time out from their normal life, whether it be for a restful break in Satisfaction: When a product delivers what has scenic surrounds or to engage in extreme sports in been promoted, the consumer is likely to feel rough terrain, whether the traveller is on their own, satisfied and remember a quality holiday with a partner or friends, or in a large group. experience, and the tourism provider will feel satisfied too. Awareness: Consumers may or may not recognise their need for a holiday. Promotions about a holiday Word of mouth: Consumers share memories of destination, product or service can motivate their holiday experiences with friends, family and consumers to recognise they need a holiday as well colleagues. Word of mouth raises awareness about as raise awareness among potential consumers of the destination, product(s) and service(s) with the choices available. potential consumers. CONSUMER DECISION MAKING Consumer Needs Word of Mouth ± Awareness ± Satisfaction ± Motivation/Interest ± Planning/decision/action 7.
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