Overview of Tourism and Hospitality Industry PDF

TH2107 Overview of the Tourism and Hospitality Industry Essential Tourism and Hospitality Concepts and Terms The tourism industry is dynamic, complex, and highly inter-connected. Travel, hospit...

TH2107 Overview of the Tourism and Hospitality Industry Essential Tourism and Hospitality Concepts and Terms The tourism industry is dynamic, complex, and highly inter-connected. Travel, hospitality, and attractions are among the words associated with tourism. The industry involves many activities, organizations, and businesses and has continuously evolved through the years (Tuazon-Disimulacion, 2016). Tourism Definition Tourism is a social, cultural, and economic phenomenon related to the movement of people to places outside their usual place of residence, pleasure being the usual motivation (Department of Tourism [DOT]). Tourism refers to the activities of persons traveling to and staying in places outside their usual environment for not more than one (1) consecutive year for leisure, business, and other purposes not related to the exercise of an activity remunerated from within the place visited (United Nations World Tourism Organization [UNWTO]). It is the behavior of tourists and what they need and seek (Demand-sided Focus Definition). It describes the product offered to tourists and what the tourists experience (Supply-sided Focus Definition). Common Tourism and Hospitality Terms The following terms are commonly used in the tourism and hospitality industry: Visitor – This is a traveler taking a trip to a main destination outside his/her usual environment, for less than a year, for any main purpose (business, leisure, or another personal purpose) other than to be employed by a resident entity in the country or place visited. Tourist – This is a visitor (domestic, inbound, or outbound) wherein his/her trip includes an overnight stay in a country or place visited. Excursionist – This refers to any person who does not spend even a night in a collective or private accommodation at the place of visit. An excursionist is also known as a same-day tourist. Tourism Product – This consists of tangible and intangible elements of a trip, including what a person does on the way to his/her destination and when staying there. It may consist of (a) built and natural attractions, (b) tours and packages, (c) services for travelers (e.g., shopping, restaurants, accommodations, medical), and (d) other activities. Travel – This refers to the movement of people or objects (such as airplanes, boats, trains, and other transportation modes) from one (1) place to another. Trip – This refers to the travel by a person from the time of departure from his usual residence until s/he returns. It is made up of visits to different places. Hospitality – It is an act of providing food, beverages, and lodging to travelers. It is derived from the Latin word hospes, which refers to both the host and the guest or visitor. Hospitality Management – It involves planning, organizing, directing, and controlling human and material resources within the lodging, restaurant, travel and tourism, institutional and recreational management, and meeting and convention planning industries. Hospitality Industry – It comprises businesses that provide accommodation, travel, food and beverage, and entertainment to the traveling public. Front of the House – It refers to the departments or personnel working with direct contact with guests, such as the front office, food and beverage, sales and marketing, and concierge. Back of the House – It refers to the departments or personnel performing behind the scenes, such as housekeeping, finance, engineering, and human resources. 01 Handout 1 *Property of STI  [email protected] Page 1 of 5  TH2107 Forms of Tourism In the tourism and hospitality industry, concepts are introduced to understand its services and products better. The following are the different forms of tourism (UNWTO, n.d.): Domestic Tourism – It involves residents of a given country traveling only within that country. For example, George, a Filipino, going to Puerto Princesa, Palawan for a vacation, is a domestic tourist. Inbound Tourism – It involves non-residents traveling to a given country. For example, Suzy, a Korean artist coming to the Philippines to perform at MOA Arena, is an inbound tourist. Outbound Tourism – It involves residents of a country traveling to another country. For example, Jeka, a Filipina traveling to Japan to visit Disneyland, is an outbound tourist. International Tourism – It consists of inbound and outbound tourism. This involves the activities of resident visitors outside the country of reference and the activities of non-resident visitors within the country of reference. This also refers to the arrivals and departures in a country. Example: Kim, a Korean, comes to the Philippines to visit her child (inbound/arrival in the Philippines). Keith, a Filipino, goes to France to see the Eiffel Tower (outbound/departure in the Philippines). Characteristics of a Tourism Product Tourism products are service-oriented and have several characteristics. These are the following: Intangibility. Tourism products cannot be directly seen, tasted, felt, or heard before their purchase and consumption. In tourism, services and experiences are what a traveler is mostly purchasing, and the only tangible items are the tickets or receipts of payments. Tourism products can be anything like a package tour or an airline ticket. If an individual books an airline ticket, s/he receives a booking reference allowing him/her to view his/her information online or check for updates; therefore, the service availed cannot be felt physically. Inseparability. Tourism products are primarily services, and they cannot be separated from the person or the company that provides them. A tourism product only exists when the consumption occurs, and the tourist has to go to the production site to utilize it. For example, the courtesy shown by an air hostess while serving a meal on board can only be experienced in the aircraft by the passenger. Perishability. It is a characteristic of products and services that do not allow for the product or service to be stored for sale at a future date. For instance, an airline cannot store 100 unsold seats on a flight scheduled to depart on March 12, 2021, and sell them on March 13, 2021, resulting in unsold seats with no value. Airlines offer last-minute seat sales to avoid this loss due to the perishable nature of the product. These last-minute sales help minimize losses and at least earn some revenue for the airlines. Same with the hotel industry, they also offer heavy discounts to help gain income during off-seasons (Tamplin, 2021). Variability. In the tourism industry, services are rendered by humans to humans. These services have a high level of variability when producers and consumers interact. The services may vary depending on the company or the owner of the product, time of purchase, and other professions involved. Airline ticket rates may be cheaper while individuals view it online, but the prices may increase upon entering the necessary information. To avoid variation in services and maintain the standards in delivering the products, hotel operators, tour operators, and airlines have introduced technologies like the computerized reservation system (CSR) and global distribution system (GDS). These systems minimize human contact and errors because they display details such as flight details and accurate airfares in one (1) screen, reducing errors in quotations and ticketing, and providing more information aside from reservation. Absence of Ownership. Purchasing an overnight stay at a hotel is not the same as buying material things. The tourist only acquires the right to certain benefits that the seller or hotel offers, but the rooms' ownership remains with the hotel. The same goes when buying an airline ticket. The traveler has the right to sit on a specific flight seat, but s/he does not own it. Manufactured by Many Producers. A tourism product involves other sectors in its production, and a single enterprise cannot provide it. Each tourism product component is highly specialized and, when combined, 01 Handout 1 *Property of STI  [email protected] Page 2 of 5  TH2107 makes the final product. The travel agents, for instance, book airline tickets and contract accommodation and car rental services to create an entire tour package sold as a single tourism product. Seasonality. It refers to predictable changes over a year in a business or economy based on the seasons, including calendar or commercial seasons. Almost all tourist areas have a short season that is popular as a peak season, and it may be as short as three (3) months. This seasonal usage of the product creates unemployment and impacts transportation and hospitality services and most other services. The suppliers of tourism services have different pricing strategies for these problems. For example, the hotel tariff will be higher in peak season, moderate in mid-season, and low in the off-season (i.e., off-season discounts are offered) (Kenton, 2020). Requirements for Tourism and Travel Motivators Requirements for Tourism A tourist must consider the following when it comes to traveling: Time – As the hours for leisure increase, so does the opportunity for travel. Changes in workdays or hours and school calendars will affect how and when people can travel. Money – The majority of travel requires discretionary income. Discretionary income is the money left over after all monetary obligations (food, rent, and taxes) have been paid. Mobility – It is the access to transportation (car, bus, plane, train, or ship) and the hours required to get to a destination. Motivation – It is why people travel. Motivations may include seeking novelty, education, meeting new people, adventure, or stress reduction. Documents – These are written or printed paper furnishing information or evidence. Documents such as passport, airline ticket, booking reservation, and visa are necessities when traveling to a certain destination or country. Travel Motivators There are various motives behind the movement of tourists. These may be leisure, business, pilgrimage, or any other reason. These may also be a combination of internal and external forces that motivate tourists, driving the tourism industry. Several studies have listed the reasons why people travel, and the following are some: McIntosh and Goeldner Categorization of Travel Motivators Dr. Robert W. McIntosh categorizes travel motivation into four (4) groups. Here are the basic travel motivators: o Physical Motivators – These motivators are concerned with an individual's physical health and well-being, which involves physical relaxation, sporting activities, medical care or treatment, and specific remedial health management. o Interpersonal Motivators – These motivators revolve around the desire of a person to make new friends, visit and meet relatives and friends, or escape from the daily hassles of everyday life. o Cultural Motivators – These motivators are based on tourists’ curiosity and want to experience different cultures, traditions, lifestyles, art, and music. o Status and Prestige Motivators – These motivators engage the need for fame and status or self- esteem and personal development. These include travel for business or professional interests. Push and Pull Theory John L. Crompton identified two (2) different socio-psychological travel motivations. First is the individual’s desire to travel to a destination for a reason. The second is the destination's appeal, or how it attracts the individual, resulting in him/her traveling to that particular destination. These concepts are as follows: 01 Handout 1 *Property of STI  [email protected] Page 3 of 5  TH2107 o Push Factors – These factors initiate the desire to travel in an individual and engage in recreational activities or tourism. Some push factors of traveling are exploration and evaluation of self, escape, relaxation, health, fitness, visiting family, facilitation of social interaction, enhancement of kinship relationships, novelty, cultural experiences, education, and prestige. o Pull Factors – These factors commonly attract individuals toward specific things or destinations, such as attractions, climate, culture, and the locals. Pull factors are categorized as follows:  Facilities Factor – It includes the tourism facilities of a destination such as food and beverage establishments, accommodation properties, roads, and security facilities.  Core Attractions Factor – It refers to all activities and services available for tourism. It includes sports activities, nightlife, festivals, entertainment, and shopping facilities.  Landscape Features Factor – It refers to the geographical features of a tourist destination such as beaches, forests, rivers, and mountains. The Importance of the Tourism and Hospitality Industry The tourism and hospitality industry is interconnected with each other as it plays a huge role in the economy, environment, and socio-culture. Listed below are the key reasons why this industry is essential (Kumar, 2020): Economic Progress - The tourism industry aids and supports foreign exchange reserves. It benefits the country when it comes to generating foreign currency. Every year many tourists visit foreign and local places. As they visit attractions and purchase local products, they contribute to a significant foreign currency generation. Source of Income - Tourism is a continual source of income for the public and private sectors. The government receives money from taxation, fees, and fines. The income generated through these charges is called public income. The profit earned by a seller by selling products like local artifacts and handicraft items to the tourists is called private income. Tourism also helps create jobs in the tourism and hospitality industry, service sector, entertainment, and transportation industry. Development of Infrastructure - Tourism also aids and encourages infrastructure development by making way for dams, roads, bridges, ports, airport improvements, and any other activity that help improve tourists’ experience in visiting a place. Societal Progress - Tourism is a wonderful method for cultural exchange. It also encourages societal progress as tourists learn to show respect, tolerance, understanding, and love for each other when they visit new places. The same goes with local communities; they will also gain knowledge from tourists from different places and learn how to interact with different people visiting their area. Cultural Heritage - Tourism helps explain the beauty, art, history, and culture of a country. Different people visiting any country take cultural concepts they learn along with them and spread those concepts to others while visiting other places in the world. This includes local skills, languages, and art which get broad exposure through tourism. Educational Significance - Tourism has been of great importance for education. It includes trips to zoos, museums, planetariums, etc. It can also be study tours, short time courses, and educational exchange programs that are a part of international tourism, and this results in better knowledge about host countries. Environmental Preservation - Tourism has spillover benefits such as preserving the environment that covers historical sites and cultural values and improves the status of the environment. The Pacific Asia Travel Association (PATA) and World Tourism Organization (WTO) have laid down environmental preservation and conservation laws that lessen environmental strain while tourists visit a destination. These laws are also a way to raise awareness of environmental values and serve as a tool to finance the protection of natural areas and increase their economic importance. 01 Handout 1 *Property of STI  [email protected] Page 4 of 5  TH2107 References: Carino, C. E., & Beltran, M. P. (2013). The hospitality industry: An introduction. Mindshapers Co., Inc. Characteristics of tourism products | General product vs tourism product. (n.d.). Our Educare. Retrieved May 12, 2021, from https://oureducare.com/tourism/characteristics-of-tourism-products/#Tourism_Product Dictionary.com. (n.d.). Document. In Dictionary.com. Retrieved May 12, 2021, from https://www.dictionary.com/browse/document Dictionary.com. (n.d.). Hospitality. In Dictionary.com. Retrieved May 12, 2021, from https://www.dictionary.com/browse/hospitality Differences between visitor, tourist and excursionist. (n.d.). TyroCity. Retrieved May 12, 2021, from https://tyrocity.com/topic/differences-between-visitor-tourist-and-excursionist/ Kenton, W. (2020, November 30). Seasonality. Investopedia. Retrieved May 12, 2021, from https://www.investopedia.com/terms/s/seasonality.asp Kumar, P. (2020, October 12). Tourism and its importance: Introduction to tourism, hospitality; Hotel industry. Hmhub. Retrieved May 12, 2021, from https://hmhub.me/tourism-importance/ Stainton, H. (2021, March 6). Environmental impacts of tourism. Tourism Teacher. Retrieved May 12, 2021, from https://tourismteacher.com/environmental-impacts-of- tourism/#:~:text=Tourism%20has%20the%20potential%20to%20create%20beneficial%20effects,of%20natural %20areas%20and%20increase%20their%20economic%20importance. Tamplin, T. (2021, June 21). What is perishability. Finance Strategists. Retrieved May 12, 2021, from https://www.financestrategists.com/finance-terms/perishability/ Travel motivation. (n.d.). Tourism Beast. Retrieved May 12, 2021, from https://www.tourismbeast.com/travel- motivation/ Tuazon-Disimulacion, M. A. (2016). Principles of tourism 2. Books Atbp. Publishing Corp. United Nations. (2010). Basic concepts and definitions: Travel and tourism (domestic and international). Retrieved May 12, 2021, from https://unstats.un.org/unsd/tradeserv/Workshops/Chisinau/docs/05%20a%20-%20UNWTO- Basis%20concepts.pdf UNWTO. (n.d.). Glossary of tourism terms. Retrieved May 12, 2021, from https://www.unwto.org/glossary-tourism- terms What is travel & tourism. (n.d.). TechnoFunc. Retrieved June 17, 2021, from https://www.technofunc.com/index.php/domain-knowledge/travel-and-tourism-domain/item/what-is-travel- tourism 01 Handout 1 *Property of STI  [email protected] Page 5 of 5