Cambridge International AS and A Level Travel and Tourism Coursebook PDF

Sue Stewart, Fiona Warburton and John D. Smith Cambridge International AS and A Level Travel and Tourism Coursebook Second edition University Printing House, Cambridge CB2 8BS, United Kingdom One Liberty Plaza, 20th Floor, New York, ny 10006, USA 477 Williamstown Road, Port Melbourne, vic 3207, Aust...

Sue Stewart, Fiona Warburton and John D. Smith Cambridge International AS and A Level Travel and Tourism Coursebook Second edition University Printing House, Cambridge CB2 8BS, United Kingdom One Liberty Plaza, 20th Floor, New York, ny 10006, USA 477 Williamstown Road, Port Melbourne, vic 3207, Australia 4843/24, 2nd Floor, Ansari Road, Daryaganj, Delhi – 110002, India 79 Anson Road, #06–04/06, Singapore 079906 Cambridge University Press is part of the University of Cambridge. It furthers the University's mission by disseminating knowledge in the pursuit of education, learning and research at the highest international levels of excellence. Information on this title: education.cambridge.org © Cambridge University Press 2017 First published 2014 Second edition 2017 20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 A catalogue record for this publication is available from the British Library ISBN 978-1-316-60063-4 Paperback ISBN 978-1-316-60064-1 Digital edition ISBN 978-1-316-63677-0 Elevate edition Additional resources for this publication at cambridge.org/9781316600634 The questions, answers and annotation in this title were written by the authors and have not been produced by Cambridge International Examinations. In an examination, the marks granted might differ from the ones given to the answers found in this material. Cambridge University Press has no responsibility for the persistence or accuracy of URLs for external or third-party internet websites referred to in this publication, and does not guarantee that any content on such websites is, or will remain, accurate or appropriate. 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Contents Introduction Acknowledgements How to use this resource 1 Features of the travel and tourism industry Introduction 1.1 The nature of travel and tourism 1.2 Scale of the travel and tourism industry 1.3 Factors affecting tourism 1.4 The structure of the travel and tourism industry 1.5 Subsectors of the travel and tourism industry Summary Exam-style questions 2 Principles of customer service Introduction: The principles of customer service 2.1 Customers and their needs 2.2 Meeting external customer needs 2.3 The impacts of quality customer service 2.4 Assessing the quality of customer service in travel and tourism organisations 2.5 Setting organisational, functional area and individual customer service standards 2.6 Delivery of customer service 2.7 General customer feedback Summary Exam-style questions 3 Destination marketing Introduction 3.1 Defining the tourism market 3.2 The aims of market research and analysis 3.3 Market research: advantages and disadvantages of each research method 3.4 Market analysis tools and techniques 3.5 Market segmentation (target customers) 3.6 Visitor profiling 3.7 Product positioning 3.8 Review the marketing mix 3.9 Building a destination brand 3.10 Characteristics of an effective destination brand 3.11 Creating a brand identity 3.12 Marketing activities for launching the brand 3.13 Implementing the destination brand 3.14 Communication methods used to raise awareness of the destination's brand identity 3.15 Considerations for selection of communication methods 3.16 Different media used to communicate the destination's brand identity 3.17 Difficulties in implementing the destination brand 3.18 Challenges in branding destinations 3.19 Methods used to monitor costs and marketing activities 3.20 Key performance indicators (KPIs) Summary Exam-style questions 4 Destination management Introduction 4.1 Organisations involved in destination management, their roles and priorities 4.2 Objectives of tourism development and management 4.3 Destination management activities 4.4 Encouraging responsible tourist behaviour through education 4.5 Destination branding and marketing: mass and specialised markets 4.6 Partnerships of commercial and non-commercial organisations 4.7 Regular environmental impact auditing 4.8 Community involvement, community projects, education training and employment of locals 4.9 Impacts of tourism development 4.10 Socio-cultural impacts of tourism 4.11 Environmental impacts of tourism 4.12 Changes in the evolution of destinations Summary Exam-style questions 5 Planning and managing a travel and tourism event Introduction 5.1 Assessment 5.2 Stages in the event 5.3 Forming - storming - norming - performing 5.4 Autocratic leadership 5.5 Democratic leadership 5.6 Bureaucratic leadership 5.7 The team performance curve 5.8 Staffing for the event 5.9 Investigate potential travel and tourism events and undertake feasibility studies 5.10 Technology in the travel and tourism market 5.11 Aims and objectives for the chosen event 5.12 Marketing the event 5.13 Use of appropriate resources 5.14 Finance 5.15 Financial documents used whilst organising an event 5.16 Business plan 5.17 Evaluation Summary Introduction Travel and tourism is the world's largest service industry and in 2015 had a global economic contribution of US$7.6 trillion. It is an exciting and dynamic industry responsible for one in every 12 jobs in the world. Tourism is also one of the fastest growing industries and is seen by many as the key to socio-economic progress. Undoubtedly, travel and tourism can be susceptible to global influences, however its business volume exceeds many other established industries such as food and oil production. This trend feeds into the mind-set of governments and policy makers where travel and tourism is seen to produce economic and employment benefits. With many traditional industries in decline, travel and tourism can offer a diverse and sustainable option, perhaps one that can offer not only economic benefits but environmental and socio cultural ones too. There are consistently popular tourism destinations in the world, such as France, USA and Italy; however, there are many emerging, less well-known destinations that are keen to benefit from the economic advantages of this massive industry. This Cambridge International AS and A Level Travel and Tourism resource has been designed and written to reflect the changes in the industry and cover the Cambridge International AS and A Level syllabus 9395 for first teaching from 2017. About the syllabus Through the study of the syllabus learners will be able to develop: An understanding of the importance of the travel and tourism industry to host destinations, to communities, to the economy, globally, nationally and locally An understanding of the positive and negative impacts of travel and tourism and the importance of sustainability An appreciation of the importance of the customer in the travel and tourism industry An understanding of how the travel and tourism industry responds to change, including technological advances Their own values and attitudes in relation to travel and tourism industry issues Problem solving, decision making and communication skills. Appreciate the scale and importance of the travel and tourism industry Learn that the travel and tourism industry is dynamic in nature and how the industry responds to change, e.g. external factors such as changing consumer needs and expectations and developments in information technology Recognise the positive and negative impacts the industry may have on people, environments and economies. The syllabus also allows learners to develop in four Assessment Objectives: AO1 Knowledge and understanding AO2 Application of knowledge and understanding AO3 Analysis and research AO4 Evaluation and decision-making In a few places this resource refers to theories outside of the syllabus remit, but which are useful for enrichment purposes. These instances have been marked with a vertical coloured bar in the margin next to the relevant text. Key concepts The key concepts on which this syllabus is built are set out below. These concepts can help learners to make links between topics and develop a deep overall understanding of the subject. They key concepts are: 1 Global and growing The travel and tourism industry is a global industry. Changes in political and socio economic circumstances and technological developments contribute to the continuing growth of the travel and tourism industry and its importance to many national economies. 2 Change and development A key feature of the industry is its dynamic nature. The only constant is change. Exciting new enterprises, products or services are often developed in response to economic, political, social or technological change. 3 Customer focus Travel and tourism organisations provide products, services and facilities to meet customer's needs. In order for travel and tourism providers to be successful, they must adopt a strong customer focus. This means they must really understand who their customers are and how they can best meet their needs. 4 Sustainability and responsibility The Travel and Tourism industry has close links to destinations and so has a vested interest in ensuring environmental and sociocultural impacts are managed. Responsible management means that any developments must maximise the positive, and minimise the negative impacts of tourism. The syllabus covered in this resource, encourages learning in practical and technical skills, including industry complex situations and problems. The resource can be used in conjunction with visits to appropriate travel and tourism organisations and destinations. Emphasis is given to the use of realia. As a vocational subject area this is vital for allowing learners to see and use authentic industry material. Key features of this resource A key feature of this resource is the inclusion of case study materials. The many references to the case studies, data and examples from countries all around the world supports practical and interactive learning styles. There is an international perspective which allows areas for discussion and links to tourism applications through the different activities provided in each chapter. Learning objectives are identified and clearly linked to content and concepts covered in each chapter. The text is clearly laid out, with easy to use sections. Emphasis is given to the use of current realia. The Key concept approach demonstrates the global nature and linking patterns of the travel and tourism industry. It allows for integration of thought processes and development of critical thinking. Key terms are given throughout each chapter to assist with understanding. A variety of 'In-chapter' activities are supplied to offer opportunity to practice applying what is being learned, using evidence and data taken from current real life situations. Examination-style questions with expected answers are provided to test the skills, knowledge and understanding of the syllabus. Opportunity for learners to develop their higher order skills in application through analysis, evaluation and assessment techniques. Resource links to current industry providers. Sue Stewart, 2016. Acknowledgements The authors and publishers acknowledge the following sources of copyright material and are grateful for the permissions granted. While every effort has been made, it has not always been possible to identify the sources of all the material used, or to trace all copyright holders. If any omissions are brought to our notice, we will be happy to include the appropriate acknowledgements on reprinting. Cambridge Digital Edition Cover image: Pablo Scapinachis/Shutterstock; Chap. 1 opener Petko Danov/Getty Images; Fig 1.1 Flip Nicklin/ Minden Pictures/Getty Images; Fig. 1.2 Jean-Pierre Pieuchot/Getty Images; Fig. 1.3 JIJI PRESS/AFP/Getty Images; Fig. 1.4 Mark Williamson/Getty Images; Fig. 1.5 Li Wei/VCG via Getty Images; Fig. 1.6 Sergey Dzyuba/ Shutterstock; Fig. 1.7 Trips of EU residents by month of departure(1) and duration, EU-28(2), 2013 (Millions) http://ec.europa.eu/eurostat/statisticsexplained/index.php/ Seasonality_in_tourism_demand © European Union, 1995-2013; Fig. 1.8 jenifoto/Getty Images; Fig. 1.9 Marco Simoni/Getty Images; Fig. 1.10 Matteo Colombo/Getty Images; Fig. 1.11 Christian Aslund/Getty Images; Fig. 1.12, 1.13 © UNWTO 92844/24/16 Source: World Tourism Organization (2015), International tourist arrivals up 4% in the first four months of 2015, press release PR15048 9 July 2015, UNWTO, Madrid (online), available at: www.unwto.org; Fig. 1.19 david franklin/Getty Images; Fig 1.20 Brian Jannsen/Alamy Stock Photo; Fig. 1.21 TOM MARESCHAL/ Alamy Stock Photo Fig. 1.22 Klaas Lingbeek- van Kranen/ Getty Images; Fig. 1.23 Manuel ROMARÍS/Getty Images; Fig. 1.24 moodboard/Getty Images; Fig. 1.26 Jordan Mansfield/Getty Images; Fig. 1.27 the Mauritius Tourism Promotion Authority (MTPA); Fig. 1.28 United Nations World Tourism Organization; Fig. 1.29 Regional Tourism Organisations New Zealand (RTONZ) with permission; Fig. 1.30 Iain Masterton/ Alamy Stock Photo, Fig. 1.32 (plane) Stephen Strathdee/Getty Images; Fig. 1.32 (cruise ship) NAN728/Shutterstock; Fig. 1.34 (train) Julian Elliott Photography/Getty Images; Fig. 1.35 (coach) Ralf Hettler/ Getty Images; Fig. 1.37 Travelasia/Getty Images; Fig. 1.37, 1.38 Brittany Ferries; Fig. 1.40 Education Images/UIG via Getty Images; Fig. 1.41 Pawel Libera Images/Alamy Stock Photo; Fig. 1.43 John WarburtonLee Photography/Alamy Stock Photo; Fig. 1.45 dpa picture alliance archive/Alamy Stock Photo; Fig. 1.47 fotostorm/Getty Images; Fig. 1.48 Piero M. Bianchi/Getty Images; Fig. 1.49 Jonny Abbas/ Alamy Stock Photo; Fig. 1.50 Trinette Reed/Getty Images; Fig. 1.52 Greg Balfour Evans/Alamy Stock Photo; Fig. 1.53 adapted from 'The 50 most popular tourist attractions in the world in 2014' by Love Home Swap, with permission; (Niagara Falls) Hans-Peter Merten/Getty Images; (Union Station) Travelpix Ltd/Getty Images; (Central Park) Yiming Chen/Getty Images; (Time Square) @by Feldman_1/Getty Images; (Las Vegas) PhotoStock-Israel/Getty Images; Fig. 1.54 EDU Vision/Alamy Stock Photo; Chap. 1 exam-style question 3 adapted from Mail & Guardian Africa; Chap. 2 opener Michael Blann/Getty Images; Fig. 2.1 Steve Back/ Getty Images; Fig. 2.3 Izzet Keribar/Getty Images; Fig. 2.4 Chris Mellor/Getty Images; Fig. 2.6 Digital Vision/Getty Images; Fig. 2.7 Walter Bibikow/Getty Images and accompanying text © Copyright 2016 FRHI, all rights reserved; Fig. 2.10 Zero Creative/Getty Images; Fig. 2.12 VIEW Pictures Ltd/Alamy Stock Photo; Fig. 2.13 Ikonoklast Fotografie/ Shutterstock; Fig. 2.15 Echo/Getty images; Fig. 2.16 by Opella Hospitality; Fig. 2.17 Dirk Renckhoff/Alamy Stock Photo; Fig. 2.18 Malcolm Park London events/Alamy Stock Photo; Fig. 2.19 David Brabiner/Alamy Stock Photo; Fig. 2.20 Bateaux Dubai; Fig. 2.21 comment card from Bateaux Dubai; Chap. 3 opener M.M./Shutterstock; Fig. 3.1 Sayid Budhi/Getty Images; Fig. 3.2 Herve Gyssels/Getty Images; Chap. 3 Case Study 1 extract from the ITB World Travel Trends Report 2014/2015; Table 3.2 adapted from 'Toward a Sociology of International Tourism' by Erik Cohen, Social Research, vol. 39, no. 1, 1972; Fig. 3.4 Erich Schmidt/Getty Images; Fig. 3.5 Juergen Ritterbach / Alamy Stock Photo; Chap. 3 Case Study 2 from Myanmar Tourism Master Plan 2013-2020, published by the Ministry of Hotels and Tourism for the Republic of the Union of Myanmar; Fig. 3.7 tourism destination questionnaire used by permission of the Ministry of Economic Development and Technology Directorate for Tourism and Internationalisation, Slovenia; Chap. 3 Case Study 4 text and Fig. 3.11 Magical Kenya brand logo used with permission of Euromonitor International Ltd; Fig. 3.12 Ozkan Bilgin/Anadolu Agency/ Getty Images; Fig. 3.15 Tetra Images/Getty Images; Chapter 3 Case Study 5 2020 summary of Tourism Australia's India Strategic Plan used by permission of Tourism Australia; Table 3.8 and text by permission of Romani-Insider.com; 'The current strength of the pound' text is adapted from article 'More bang for your buck' by TravelMail Reporter, June 2014, The Daily Mail, © Solo Syndication; Fig. 3.14 Brian Jackson/ Alamy Stock Photo; Fig. 3.15 permission from Brighter Group; Fig. 3.16 permission from fonekites.com; Fig. 3.17 Cayman Islands Department of Tourism; Fig. 3.18 by permission of Agenzia Nazionale del Turismo - ENIT; Fig. 3.20 Ian Cumming/Getty images; Fig. 3.21 Greg Johnston/Getty Images; Fig. 3.24 from www.klsentral.com; Fig. 3.23 SergeiKorolko/Getty images; Fig. 3.24 discount coupons by permission of Gyeonggi Tourism Organization, Korea; Chap. 3 Case Study 8 with permission of Delamar Hotels; Fig. 3.25 g bell/Alamy Stock Photo; Fig. 3.26 Pure Granada logo; Fig. 3.27 Randy Duchaine/Alamy Stock Photo; Fig. 3.28 Cultura RM Exclusive/Rosanna U/Getty Images; Fig. 3.29 Ethiopia logo used with permission; Fig. 3.30 Albania Go Your Own Way logo used with permission; Fig. 3.31 by permission of Destination Canada; Fig. 3.32 Amazing Thailand logo; Fig. 3.33 Agencja Fotograficzna Caro/Alamy Stock Photo; Chap. 3 Case Study 11 by permission of Tourism Tasmania; Chap. 3 Case Study 12 adapted from AEC News; Fig 3.38 IndianSummer/Alamy Stock Photo; Fig. 3.35 with permission from Tourism Nova Scotia; Fig. 3.36 Kevin Foy/ Alamy Stock Photo; Fig. 3.37 and text with permission of DublinTown; Chapter 3 Case Study 15 with permission of The YGS Group for Fast Company; Fig. 3.40 with permission of Shrewsbury Business Improvement District LTD; Fig. 3.41 Matej Kastelic/Shutterstock; Fig. 3.42 The Seychelles Islands logo; Fig. 3.43 by permission of Visit Maldives; Chap. 3 Case Study 16 with permission of Bloom Consulting; Chap. 4 Opener pbombaert/Getty images; Fig. 4.1 Sergey Borisov/Alamy Stock Photo; Fig. 3.37 Mikkel_ Barker/Getty Images; Fig. 4.3 Pierre Leclerc Photography/ Getty Images; Chap. 4 Case Study 1 with permission of the Singapore Tourism Board; Fig. 4.4 abilityriddle/Getty Images; Fig. 4.5 with permission of the Malta Tourism Authority; Fig. 4.6 Peter Unger/Getty Images; Fig. 4.7 David Kirkland/ Design Pics/Getty Images; Fig. 4.8 RGB Ventures/ SuperStock/Alamy Stock Photo; 'Welcome to JacTravel' is used with permission of JacTravel; 'Germany's leading tour operator' is used by permission of TUI Group; Fig. 4.10 Martin Harvey/Getty Images; Fig. 4.12 Donald Michael Chambers/Getty Images; Chap. 4 Case Study 2 text and logo used with permission of The Travel Foundation; Chap. 4 Case Study 3 from Virgin Gallactic.com; Fig. 4.14 Jonathan Daniel/Getty Images; Fig. 4.15 KAZUHIRO NOGI/AFP/Getty Images; Chap. 4 Case Study 4 with permission of the English Riviera Tourism Company; Fig. 4.16 Paul Heinrich/Alamy Stock Photo; Chap. 4 Case Study 5 with permission of Kaya Responsible Travel www.kayavolunteer.com; Fig. 4.17 Paula Bronstein/Getty Images; Chap. 4 Case Study 6 from www.rio2016.com; Fig. 4.18 AlphaAndOmega/Alamy Stock Photo; Fig. 4.19 Kika Pierides/Getty images; Fig. 4.21 Devasahayam M. Chandra Dhas/Alamy Stock Photo; Fig. 4.23 Horizon Images/Motion/ Alamy Stock Photo; Chap. 4 Case Study 7 including Fig. 4.25 used with permission of St Helena Tourism; Fig. 4.26 Tom Nevesely/Getty Images; Fig. 4.27 Richard I'Anson/ Getty Images; Fig. 4.28 Hugh Mackintosh/Getty Images; Fig. 4.31 Franz Marc Frei/Getty Images; Fig. 4.32 chrisdorney/Getty Images; Fig. 4.35 Artur Debat/Getty Images; Fig. 4.36 Michael Arthur Thompson/Alamy Stock Photo; Fig.s 4.37-4.41 John D. Smith; Fig. 4.43 Universal Images Group North America LLC/Alamy Stock Photo; Fig. 4.45 Peter Adams/Getty Images; Fig. 4.46 and text in Chap. 4 exam-style question 2 used with permission of Tourism Concern; text in chap. 4 exam-style question 3 used with permission of The Zambezi Society - www.zamsoc.org; Chap. 5 Opener VisitBritain/Alan Chandler/Getty Images; Fig. 5.1 Okea/Getty Images; Fig. 5.4 Cliff Hide Stock/Alamy Stock Photo; Fig. 5.5 Image Source/Alamy Stock Photo; Fig. 5.7 Alistair Berg/Getty Images; Chap. 5 Case Study 1 with permission of FAR and WIDE Zimbabwe; Fig. 5.8 Panoramic Images/Getty Images; Fig. 5.11 Heshamy Fath/Anadolu Agency/Getty Images; Chap. 5 Case Study 2 text and data used with permission of UNWTO; Fig. 5.12 AXEL SCHMIDT/ AFP/Getty Images; Fig. 5.14 AndreyPopov/Getty Images; Chap. 5 Case Study 3 from eTurboNews with permission of eTN Corporation; Fig. 5.15 ALBERTO PIZZOLI/AFP/Getty Images; Fig. 5.16 Discover Brunei; Fig. 5.17 Pablo Cuadra/ Getty Images; Fig. 5.20 John Freeman/Getty Images; Chap. 5 Case Study 6 survey results from Singapore Airlines; Fig. 5.21 TRISTAR PHOTOS/Alamy Stock Photo Supplementary Case Studies CS1 adapted from article by the Associated Press, published in Gulf News, 2012; image THOMAS COEX/AFP/ GettyImages; CS3 'Help us save the environment' card from JA Jebel Ali Golf Resourt, Dubai, image li jandwang/ Getty Images; CS5 Trailfinders promotional leaflet used with permission of Trailfinders; CS6 adapted from TravelDailyNews; CS7 image Ditto/Getty Images; CS8 adapted from the Central Japan Railway Company, image Pierre Klemas/Getty Images; CS11 adapted from Visit Britain, image Caiaimage/Sam Edwards/Getty Images; CS12 adapted from eTurboNews with permission from eTN Corporation, image Nilanjan Sasmal/Getty Images; CS13 adapted from madamtussauds.com, image Fred Duval/ FilmMagic/Getty Images; CS14 adapted from eTurboNews with permission from eTN Corporation, image Hagen Hopkins/Getty Images; CS15 with permission of Fáilte Ireland, image Trish Punch/Getty Images; CS16 adapted from eTurboNews with permission from eTN Corporation, image Danita Delimont/Getty images; CS17 text and image by permission of Mas Vidrier; CS18 with permission from Morro Bay's City Manager, image John D. Smith; CS19 adapted from fcbarcelona.com, image John D. Smith; CS20 adapted from eTurboNews, image John D. Smith; CS21 adapted from Cape Town Magazine, image John D. Smith How to use this resource In this section of the syllabus you will learn about: the nature of travel and tourism, including the main types of tourism, types of destination, the main reasons why people travel and characteristics of the industry the scale of the travel and tourism industry factors affecting tourism the structure of the travel and tourism industry the subsectors of the industry. Learning Objectives Set the scene of each chapter, help with navigation through the resource and give a reminder of what’s important about each topic. KEY TERMS Destination: any geographical area consisting of all the services and infrastructure necessary to support tourism i.e. the basic physical and organisational structures and facilities (e.g. buildings, roads, power supplies). Key terms Clear and straightforward explanations are provided for the most important words in each topic. Drive to maturity: growth should be self-sustaining, having spread to all parts of the country, and leading to an increase in the number and types of industry. During this stage more complex transport systems and manufacturing expand as transport develops, rapid urbanisation occurs, and traditional industries may decline. This has been the experience of many of the 'Tiger' and 'BRIC' economies with sustained GDP growth and rising per capita income levels. Age of mass consumption: rapid expansion of tertiary industries occurs alongside a decline in manufacturing. This is the situation in most MEDC nations where GDP levels are high but growth is slow. Per capita incomes are high and large sections of the population have significant levels of disposable income to consume a variety of goods and services. Enrichment/Extension material Theories outside of the syllabus remit. ACTIVITY 3 Choose two different destinations. Research and compare the range of built and natural attractions offered in each destination. Which destination would you recommend to a leisure visitor? Give reasons for your recommendation. Activities Chapter activities offering students the opportunity to practice applied learning using varied evidence, data and situations. Key Concept Indicate to students and teachers where specific areas of the text meet the key concepts of the syllabus. KEY CONCEPTS Change and development The Rostow Model epitomises the concept of change and development within destinations. It maps out how a destination evolves over time, linked to economic development. CASE STUDY 3 Pollution Haze affecting Thai tourism industry – October 2015 After engulfing Singapore, and parts of Malaysia and Indonesia, thick haze is also causing severe pollution in southern Thailand, and impacting the nation's crucial tourism sector. Caused by forest ires in Indonesia, the thick smog, which has already shrouded parts of Malaysia and Singapore for two months, has also reached hazardous levels in the five southern Thai provinces of Songkhla, Satun, Pattani, Surat Thani and Yala, making the areas dark and foggy. In fact, the pollution index recently hit a record-high reading of 365 in Thailand. (A reading of 101–200 is unhealthy; 201–300 is very unhealthy and above 300 is hazardous.) The next provinces up the peninsula, Narathiwat, Phuket and Phangnga, have dust levels within acceptable margins, but are coming close to the limit. As a result, the tourism industry is starting to feel the impact of the prolonged haze as Phuket and Surat Thani boast pristine tropical beaches which are popular among tourists. December is a crucial peak season for the Thai tourism industry, and if the haze continues during November, it could affect tourism bookings as tourists try to avoid the haze-afected tourism destinations in Southeast Asia. In fact, some tour operators have already complained about several lights packed with tourists being delayed or diverted due to unsafe conditions, as well as about holiday plans being cancelled. Tourism is a crucial part of the Thai economy, contributing around 10% of GDP, taking into account output and employment multiplier effects throughout the economy. And with the Thai economy already weak due to the impact of political turmoil during 2014, the haze conditions could further damage the tourism sector. Case Studies Real life examples and data from the tourism industry around the world to support students with practical and interactive learning. Exam-style questions Question 1 a. Explain, using examples, the difference between mass tourism and specialised tourism. [4 marks] b. Analyse the relationship between the reasons why people travel and the types of destinations they visit. [6 marks] c. Evaluate why LEDCs often find it difficult to attract tourists. [9 marks] Question 2 The Seychelles islands are becoming an increasingly popular tourist destination after a 15% increase in arrivals was recorded between January and April 2015, when compared with the same period the previous year. During 2014, the number of visitors who came to the Indian Ocean archipelago of 115 islands were almost the same compared with 2013, recording only a 1% increase. However, 2015 seems likely to have been a good year for the Seychelles tourism industry. According to the National Bureau of Statistics (NBS), the months of March and April of 2015 recorded the highest number of visitors since January 2009 with 25 129 and 25 038 visitor arrivals respectively; a very promising figure for the small island state with a population of 90 000. Tourism is the main pillar of the Seychelles economy. The island nation, which is situated in the Indian Ocean, east of the African Coast and northeast of Madagascar, is known for its white-sand beaches, turquoise sea water and its unique, well-preserved environment. http://www.seychellesnewsagency.com Refer to the information about tourism in the Seychelles. a. Describe two reasons for the appeal of the Seychelles as a destination. [4 marks] b. Analyse the data relating to tourist arrivals for the Seychelles and explain why these figures are important for the destination. [6 marks] c. Discuss how ecological factors such as climate change might affect the future of tourism for an island destination such as the Seychelles. [9 marks] Exam-style questions Final questions to test student skills and their comprehension of the syllabus. Summary To review what the student will have learnt in the chapter. Summary We have seen how all aspects of the travel and tourism industry overlap and interrelate in creating the overall visitor experience. The component subsectors all depend on each other. All component subsectors will have some form of relationship with most of the other destination features. For example, the development of a new tourist attraction at a destination will have an effect on transport, the demand for accommodation and catering facilities, tour operators may want to organise tours to the new attraction and the local or regional tourism board will help to promote it. For this section, you should be able to: give relevant examples of the current structure of the industry explain key organisations that make up the structure and their products, services, values and objectives analyse information and data relating to the structure of travel and tourism make appropriate judgements about the relationships between organisations within the industry. Chapter 1 Features of the travel and tourism industry In this section of the syllabus you will learn about: the nature of travel and tourism, including the main types of tourism, types of destination, the main reasons why people travel and characteristics of the industry the scale of the travel and tourism industry factors affecting tourism the structure of the travel and tourism industry the subsectors of the industry. Introduction The past 70 years have seen a remarkable growth in tourism-related activities. For example, the number of international arrivals shows an evolution from a mere 25 million international arrivals in 1950 to nearly 12 billion in 2015, corresponding to an average annual growth rate of over 6%. Today travel and tourism is one of the world's largest industries, it was responsible for 9.8% of world GDP (US$7.6 trillion) in 2014, 5.4% of total exports and now supports nearly 277 million people in employment, which equates to 1 out of every 11 people, in both the advanced and emerging economies. Furthermore, growth in tourism is expected to continue at a rate of 4% each year with tourists expected to continue spending more per trip and to stay longer on their holidays in the next ten years. The Cambridge International AS and A Level syllabus introduces candidates to the dynamic nature of the travel and tourism industry and to the various ways in which it responds to change. This gives the readers a broad understanding of one of the world's fastest growing industries. This resource investigates the reasons for the rapid growth in the modern travel and tourism industry and shows why it is described as 'the world's biggest industry'. Readers will learn that the international travel and tourism industry consists of a wide variety of commercial and noncommercial organisations that work together to supply products and services to tourists. During your studies, you will develop an appreciation of the values and attitudes of different organisations and the significance of travel and tourism to the economies of many countries. To help introduce you to the content here are a few simple starter activities. You may or may not have studied the travel and tourism industry before but you will know something about it. Complete the following holiday survey, based on your most recent experience, with as many details as you can remember about the trip. Holiday Features Details Holiday Features Details destination length of stay transport accommodation excursions/visits activities food & drink type of booking Table 1.1 The details you provide will be valid illustrations of aspects of the Travel and Tourism syllabus content. The destination you visited determines whether you would be classified as a domestic or an outgoing tourist. The destination, if abroad, may have been long haul or short haul; at home it may have been a short break or you were visiting friends and relatives, which is known as VFR. ACTIVITY 1 1. You should be able to identify and provide examples of the main Travel, Tourism and Hospitality component activities present in your local area. You should be aware that it is possible to place these into categories. Name three examples in your local area of each of the following: places of entertainment travel service providers (travel agents etc.) transport services (air, rail and road) catering facilities accommodation types sport and leisure venues/providers other visitor attractions. 2. These are all examples of the things that help to make tourism come alive not just in your local area but in all types of destination. You will have paid money and been a customer in some of them. If you went to primary school in your local area you will have seen lots of changes over the last decade. Think and write about some illustrations of the following: new building developments new events new attractions. 3. Have you been a guest at a wedding reception or some other similar event? Where was it held and what did the event involve as far you can remember? Your answers to all these questions will show that you have some basic familiarity with the products, services and facilities provided by travel and tourism organisations. The accommodation used during your trip may have been serviced or self-catering, such as a four star hotel or a camp site, and you may have had half board or an all-inclusive meal plan. Whilst on holiday you may have visited natural and/or built tourist attractions and used the services of a local Tourist Information Centre (TIC) or guide. The holiday, or some of its components, may have been booked through a travel agency or direct with a tour operator. Different methods of transport by land, sea and air may have made up parts of the holiday. There will be some aspects of your local area that will qualify it as being a tourist destination. Destinations are places where tourism develops. Tourist destinations are themselves influenced by the prevailing social, cultural, environmental, economic and political conditions. It is fundamental to the concept of the tourist destination that tourism is generally not the sole economic activity or function within the area identified as a destination. 1.1 The nature of travel and tourism Travel, tourism and hospitality are old concepts and history is full of examples of explorers travelling to distant lands. Today, people around the world travel for many reasons and international travel by road, rail, sea and air transport has become common. However, should all people who travel to a particular destination be regarded as tourists? It is worthwhile now to consider the definition of the word 'tourist'. In 1995, the World Tourism Organization (UNWTO) provided the following clarification: 'Any person who travels to a country other than that in which s/he has his/her usual residence, but outside his/her usual environment for a period of at least one night but not more than one year and whose main purpose of visit is other than the exercise of an activity remunerated from within the country visited. This term includes people travelling for leisure, recreation and holidays, visiting friends and relatives, business and professional health treatment, religious pilgrimages and other purposes.' 'This definition of what being a tourist actually involves helps us to define the word tourism with a good degree of accuracy and one of the more straightforward definitions is that used by the UK Tourism Society:' 'Tourism is the temporary short term movement of people to destinations outside places where they normally live and work, and their activities during their stay at these destinations.' 'In other words, tourism comprises the activities of persons travelling to and staying in places outside their usual environment for not more than one consecutive year for leisure, business and other purposes. We can now have a look at some of the different types of tourism and consider the main reasons why people travel.' Main types of tourism Domestic tourism Tourism is classified as domestic when the trip or holiday takes place within a person's home country. If a traveller crosses one or more national borders, this becomes international tourism and they will be classified as an international arrival in their destination country. An American citizen flying from Los Angeles (LAX) to Auckland (AKL) would be an outbound tourist from the USA and an inbound tourist to New Zealand. International tourist arrivals and international tourist receipts are the most commonly accepted measures of a country's international tourism industry. Tourism is a key driver of New Zealand's economy and it attracts people from around the world. Tourism's direct contribution to New Zealand's GDP was NZ$8.3 billion or 4.0% in 2014. Domestic tourism in New Zealand continues to grow. Domestic tourism is popular with some people because it is convenient in many respects. For example, there are no difficulties speaking the language, using the currency and no passport or visa is required for travel. During 2013 domestic tourism increased by 4% to reach 19 million trips. 2013 domestic trip growth was, however, lower than the 9% growth seen in 2012. The more moderate growth in 2013 was perhaps due in part to the appreciation of the New Zealand dollar between 2012 and 2013, which made outbound travel more attractive. The number of domestic trips is expected to reach 21 million trips by 2018. Domestic travel spending generated 56.3% of direct travel and tourism GDP in 2014 in New Zealand compared with 43.7% for visitor exports (foreign visitor spending or international tourism receipts). Domestic travel spending is expected to reach the value of NZ$15.9 billion by 2025. Type of domestic Number of trips trip (millions) Annual growth (%) day trips 31.5 14.6 overnight trips 16.6 4.1 total nights 49.1 2.8 Table 1.2 Tourism is a key driver of New Zealand's economy Inbound tourism involves overseas residents visiting a country and in 2014 New Zealand received 2 857 400 international visitors, up 5.1% on the previous year. International visitors contributed more than NZ$9.6 billion to New Zealand's economy. Figure 1.1 shows one of New Zealand's attractions for inbound tourists. Figure 1.1 Whale watching in New Zealand Key market Number of trips (millions) Annual growth (%) Australia 1 156 426 +3.3 UK 230 316 -1.7 USA 184 714 -2.6 China 145 524 +18.6 Japan 68 963 -21.4 Table 1.3 International visitors in New Zealand Outbound tourism refers to residents leaving their home country to travel overseas, usually for a holiday. In 2011, New Zealand residents made 2.2 million trips abroad, up 1% on the previous year. KEY CONCEPTS Global and growing The New Zealand study shows the growth rate of tourism for one country, but the patterns shown can be found around the world, highlighting the importance of this industry on a global scale. Mass tourism Mass tourism is a form of tourism that involves a large number of tourists coming to one destination. There is usually a particular reason to visit a particular location for mass tourism purposes, such as skiing in a mountain resort or sunbathing at a beach location. This form of tourism can involve tens of thousands of people travelling to the same destination, often at the same time of year. It has been the most popular form of tourism since mass tourism holiday products were introduced in the 1970s as it is often the cheapest way to go abroad on holiday. A traditional package holiday is an example of mass tourism. Specialised tourism Tourism has changed in recent times to reflect the changing tastes and preferences of visitors. To meet the needs, wants and expectations of a more adventurous population, the travel and tourism industry has responded over the last decade with the rapid growth of specialised tourism geared towards particular interests such as hiking, painting or culinary activities. According to the World Tourism Industry (UNWTO), specialised tourism can be defined as that which involves individual or group tours by people who wish to develop their given interests or visit places with a connection to their specific interest. Sports tourism and medical tourism are two examples. We will look at a broad range of different forms of specialised tourism later in the chapter. Independent and packaged tourism Another innovation that has affected the travel and tourism industry in recent years is the way in which travel and tourism products are packaged. The rapid development of online services have changed how travellers book holidays. This has led to the creation of independent tourism. An independent holiday is one in which the traveller organises and books transport and accommodation from separate sources rather than purchasing them together as part of an organised package. Packaged tourism, on the other hand, is defined as the simultaneous sale of at least two elements of a holiday to the traveller, such as fares on public transport (e.g. flights) and commercial accommodation (e.g. a hotel or self-catering apartment). Other elements, such as meals or excursions, are not essential to the definition of a holiday package, but may also be included. Types of destination KEY TERMS Destination: any geographical area consisting of all the services and infrastructure necessary to support tourism i.e. the basic physical and organisational structures and facilities (e.g. buildings, roads, power supplies). Simply then, destinations are the places to which people travel in order to take part in leisure and tourism activities. Because people travel for different reasons, different aspects or features of a destination may appeal to different people. Destinations can be categorised under the following types. Resort The word 'resort' is often used to describe a tourism destination. These are places in which a high proportion of the jobs and businesses are connected to tourism. Resorts have a range of accommodation and include a number of attractions and other tourist facilities. For example beach resorts are on the beach and the main amenities and activities for visitors are linked to the beach, as in Benidorm and Alicante, which are in the Costa Blanca area of Spain. Resorts can also be purpose built such as Center Parcs or Disneyland Paris. These offer accommodation, food and beverages, activities and amenities designed around a certain theme and were carefully planned and developed to attract certain customer groups. Integrated resorts are a relatively new, mixed development concept which are large scale and purpose built. An integrated resort offers a broad range of leisure and conference facilities as well as a casino. There are two integrated resorts in Singapore, which opened in 2010. Resorts World Sentosa is a family-centred attraction, and includes the region's first Universal Studios theme park, S.E.A. Aquarium (one of the world's largest aquariums), Adventure Cove Waterpark and Dolphin Island. Other attractions include a Maritime Experiential Museum, an award-winning destination spa, a casino, six unique hotels, the Resorts World Convention Centre, celebrity chef restaurants and specialised retail outlets. Marina Bay Sands (see Figure 1.2) is a luxury resort complex, offering a 2 561-room hotel, a convention-exhibition centre, The Shoppes at Marina Bay Sands boutique shopping centre, a museum, two large theatres, seven 'celebrity chef' restaurants, a skating rink and the world's largest atrium casino with 500 tables. Other countries also offer integrated resorts, which are popular especially in Asia. Figure 1.2 The Marina Bay Sands Integrated Resort, in Singapore Town, city, country Any geographical location can be a destination if it has the ability to attract visitors to it, no matter the size or scale of the area. Small medieval towns, historic city centres, even whole regions such as the Loire Valley in France or the Shanxi province in China are all destinations with charm, curious traditions, popular festivities and delicious local foods to attract tourists. Countries can be described as destinations too: Thailand or Kenya are both popular. Urban and rural Urban destinations are those with a relatively high population density so these are mainly large towns and cities. Day trips are popular to urban destinations as the transport infrastructure is usually well developed to complement a wide range of other facilities for tourists. Tourists usually go there for business purposes, to go shopping, for entertainment venues or to visit museums, churches and other built attractions. New York is an example of an urban destination. Rural destinations, also known as countryside destinations, are those in more remote and less densely populated areas. Tourists visit rural destinations to enjoy natural attractions such as lakes, mountains and forests. An example of a rural destination is the Fjords of Norway. Coastal and island Coastal destinations as the term suggests are towns and villages that attract visitors because they are located on the coast. Visits here are also known as seaside tourism and these types of destination are popular with families. Coastal destinations form an important part of the traditional 'Sun, sea and sand' package holiday. Calangute is a coastal destination in Goa, India. Island destinations attract visitors with their exotic images of white sandy beaches, activities such as snorkeling amongst the coral reefs and their strong cultural heritage. Jamaica is an island destination in the Caribbean. More Economically Developed Countries (MEDCs) and Less Economically Developed Countries (LEDCs) This is an important means of classifying destinations. Traditionally MEDCs have played an important role as destinations, acting as tourist receiving areas because they have the most developed infrastructure to support visitor numbers. Typical MEDCs are in the northern hemisphere and include countries in Western Europe, North America, Australia and Japan. By nature LEDCs are poor countries, and do not have stable economies. Their infrastructure is not well developed and there are sometimes political problems. All of these factors have made them unsuitable as tourist destinations in the past. Examples of LEDCs include Ethiopia, Cambodia and Haiti. However, over the last decade or so, many LEDCs have realised that there are many benefits to be gained from tourism and therefore some of these countries are emerging as destinations, attracting increasing numbers of visitors. Many LEDCs have been able to promote and exploit their natural landscapes and wildlife, from safaris in Tanzania and Kenya, gorilla trekking in Rwanda, to rainforest trekking in Costa Rica and glacier tours in Argentina. Other countries have relied on historical and cultural attractions such as Mexico and Egypt with their pyramids, Laos with the Angkor Watt temples and Peru with the Inca ruins of Machu Picchu. Newly industrialised countries (NICs) including Brazil, India and China are also gaining importance as destinations. KEY CONCEPTS Change and development Emerging destinations are an example of how the travel and tourism industry can cause positive change and enable destinations and economies to develop. KEY TERMS Tourism generating area: places where the majority of tourists originate. Tourism receiving area: main areas to which the majority of tourists travel. Reasons why people travel People travel for a variety of reasons and the most commonly used sub-divisions are as follows. Leisure travel Very simply, leisure travel is travel for pleasure and enjoyment. Leisure tourists visit a destination to see an attraction, take part in activities and to experience a break from their usual daily routines. The important point about leisure travel is that people are travelling to engage in some leisure-related activity during their free time and that they are using their own money in order to do so. Their travel plans are not work-related (although it is common for some individuals to combine business with pleasure) and to all intents and purposes such travellers are on holiday. Furthermore, these leisure travellers can be sub-divided into categories such as day trippers, overnight visitors or those on a particular type of holiday such as a short break. Business travel Business travel is an important part of the global travel and tourism industry and it is frequently referred to as MICE (Meetings, Incentives, Conferences and Exhibitions). People travelling for workrelated purposes are business tourists. A particular business traveller may be going to meet with colleagues, they might be a delegate at a conference or an attendee at an exhibition or they might be travelling as a reward for past job performance. A characteristic feature of business travel is the fact that the employer will meet a significant proportion of the cost of travel and so business travellers tend to spend more than leisure travellers both in terms of transport and accommodation. Visiting friends and relatives (VFR) There is a trend in both the More Economically Developed Countries (MEDCs) and the Less Economically Developed Countries (LEDCs) for international travel for the purpose of visiting friends and relatives. In many cases, migration has resulted in large numbers of people working overseas while their families remain at home. This means that there will be a regular flow of expatriate workers travelling for home visits throughout the year, but particularly at holiday and festival times. VFR tourists usually spend money on transport and activities, but not on accommodation. However, the travel and tourism industry is very dynamic and changes in the types of tourism people prefer have encouraged tour operators to offer specialised holidays catering for specific requirements. These focus on interests and activities which appeal to a particular sector of the tourist market. KEY CONCEPTS Customer focus By adapting to the specific wants and needs of customers, the travel and tourism industry can definitely be described as customer-focused. This has given rise to a variety of key specialised markets and travel motivations based on the particular reasons for travel such as: medical tourism: medical packages which offer cheaper general or cosmetic surgery abroad, followed by a period of recuperation religious tourism: religious journeys or pilgrimages to destinations such as Jerusalem, Lourdes and Mecca adventure tourism: such as trekking in the jungles of Borneo or the mountains of Nepal cultural tourism: heritage tours visiting historical and cultural sites, often in cities such as Rome, Athens, Florence and Venice ecotourism: trips to experience the unspoilt natural environment and wildlife in destinations such as Amazonia or Antarctica sports tourism: trips to see a cricket or rugby team in a competition abroad or attending the FIFA World Cup or the Olympic Games health and spa tourism: visits to spa resorts which offer health therapy and beauty treatments in luxurious, relaxing surroundings such as found at Kamalaya Koh Samui in Thailand. Special interest tourism, including dark tourism: trips to the locations of former conflicts, such as battlefields or concentration camps such as Auschwitz and Dachau; slum tourism: organised excursions to informal settlements and impoverished areas as a more realistic form of experiencing a country, by getting in touch with real people and the local culture. An example is Favela Da Rocinha in Rio De Janeiro in Brazil; and film tourism: a specific form of cultural tourism which reflects the growing interest and demand for locations which become popular due to their appearance in films and television series. Film tourism is particularly big in New Zealand following the success of The Hobbit. ACTIVITY 2 To help you get a clearer idea about tourism in your own country, undertake some research and complete Table 1.4. Purpose of tourism in your chosen country for last year Leisure Your country residents Overseas visitors No. of trips No. of visits Spending Spending Purpose of tourism in your chosen country for last year Business VFR Other Total Table 1.4 You could then compare and contrast these figures with those given in Table 1.1 and attempt to explain any differences. Characteristics of destinations and attractions which appeal to visitors A broad range of features exist within each destination which attract visitors or play an important part in their decision to visit. The following section explores a number of these reasons. Accessibility The provision of safe, convenient and economical transport and other tourism-related infrastructure is a key factor for the success of tourism in any destination. Visitors must have easy and affordable access to a destination in order to want to travel there. Having a good international airport, served by a number of international airlines from around the world makes a destination more accessible. Good local infrastructure, with good public transport networks and a variety of well-connected public amenities also attracts more visitors. Built and natural attractions When choosing where to visit, tourists will consider what attractions there are on offer. An ideal destination will have a broad mix of built and natural attractions as this creates the broadest appeal to visitors. Built attractions include churches, museums, castles, theme parks, zoos, art galleries, theatres and cinemas. Natural attractions include National Parks, lakes, beaches, forests etc. ACTIVITY 3 Choose two different destinations. Research and compare the range of built and natural attractions offered in each destination. Which destination would you recommend to a leisure visitor? Give reasons for your recommendation. Climate The climate affects people's motivation to travel. Favourable climatic conditions at destinations are key attractions for tourists, especially in beach destinations. Most tourists seem to like to travel to destinations where it is mainly warm and dry. Mountain tourism or winter sports are also highly dependent on specific climate and weather conditions, for example fresh snow for skiing. Culture Culture refers to a way of life of a group of people, the behaviours, beliefs, values and symbols that they accept, that are passed along by communication and imitation from one generation to the next. Culture is of huge importance as a characteristic of a destination that draws visitors in. There are many different cultural aspects that appeal to visitors who want to experience something different from what can be experienced in their place of residence. Traditions These are the long-established customs that people from different cultures continue to practise. For example, ancient Māori cooking techniques practised by the indigenous people in New Zealand use natural cooking pools within the geothermal hot springs. Visitors are invited to witness the local people preparing food in this way. Language Language reflects the nature and values of society. Some countries have two or three languages. Tourists may often only choose to travel to destinations in which there is no communication barrier because of the languages commonly spoken in that country. English is without a doubt the actual universal language in tourism terms. It is the world's second largest native language and is the official language in 70 countries. This will help reassure many tourists as they can use English to communicate with local people, even if it is not the native tongue for either the visitor or the local person. Gastronomy Some tourists will choose a destination where the local food and beverages are the main motivating factors for travel. Travelling to taste the local speciality food and beverages tends to be a domestic tourism activity, with visitors travelling to places to eat and drink specific, local produce. For example in Barcelona, cultural tourists can book onto the Gastronomic Treasure Hunt. Participants will be asked to perform different, fun tests to develop their senses of taste and smell and their abilities to cook in a light-hearted way while they discover the secrets and curiosities of Catalan and Spanish gastronomy. Dress For people from certain cultures, the dress code within a destination is an important factor. For example, public bathing in bikinis is not acceptable within all cultures, therefore visitors from certain cultural backgrounds might choose not to visit beach resorts where this is commonly practised. Handicrafts Crafts reflect the artistic sense, feelings and cultural characteristics of a destination. People often choose destinations which offer traditional handicrafts, although this is unlikely to be a main travel motivation; combined with other cultural 'pulls' it might be one of a number of reasons why tourists visit a particular destination. In Turkey, for example, weaving materials from wool, mohair, cotton and silk are popular forms of handicrafts, which tourists often observe during their visit and purchase as souvenirs. Events These are an important reason why visitors choose certain destinations at particular times of the year. There are many different types of events held around the world each year, which draw in large numbers of visitors. They include: art events such as The Setouchi Art Festival in Japan, which brings artists, architects and designers together to display artwork in a range of different media (see Figure 1.3); music events including international music festivals such as the Montreux Jazz Festival, which celebrated its 50th year in 2016. More than just a jazz festival, Montreux has seen top names from pop, rock and hip hop music perform each year to more than 200 000 visitors. A festival is the name given to a period of celebration typically for religious reasons but nowadays also used to refer to an organised series of concerts, plays, or films held annually in the same place. Festivals appealing to tourists range from the Monkey Buffet Festival held in Thailand each year to pay respect to the macaque monkey population in Lopburi, to La Tomatina. The industrial town of Buñol in Valencia, Spain welcomes 20 000 visitors to throw tomatoes at one another every August. Sporting events attract visitors to specific destinations. Some are fixed year after year such as the Wimbledon Tennis Championships. Other major sporting events change location, such as the Olympic Games or the UEFA Champions League football matches. Fans of such sports will plan their visit to see their teams perform around the world. Figure 1.3 An exhibit at The Setouchi Art Festival in Japan History Historical attractions play an important part in tourists' decisions to visit a destination. Cities often offer a choice of many different historical attractions, for example in Rome visitors can visit the Colosseum, the Roman Forum and the Pantheon. Or there are the Elephanta Caves located in western India, which is a UNESCO World Heritage site (see Figure 1.4). Figure 1.4 The Elephanta Caves in western India Architecture Some visitors are drawn to destinations with interesting and unique architecture, such as Dubai, with the Burj Khalifa, the world's tallest building and the sail-shaped Burj Al Arab hotel, the world's first seven star hotel. Leisure activities For many tourists, it is the range of leisure activities available within a destination that influence the decision to visit. For example, the 'Discover the best of Mauritius' website lists kite surfing, swimming with dolphins, canyoning, underwater walking, mountain biking and golf as just some of the leisure pursuits that the island offers to its visitors. Or for some, the travel motivation is the availability of one particular leisure activity within a destination, for example, visiting the Bifengxia Panda Reserve in Ya'an, in the Sichuan Province of China (Figure 1.5). Figure 1.5 Pandas playing at the Bifengxia Panda Reserve in Ya'an, in the Sichuan Province of China Range and type of accommodation, including grading A destination will appeal to a wide customer base if there is a large variety of different types of accommodation on offer, ranging from camp sites and simple hostel accommodation to attract budget travellers through to luxurious five star hotel accommodation. It is important to understand that the types of accommodation used by tourists can be either serviced or non-serviced. In serviced accommodation the price charged to customers reflects the fact that members of staff are available on site to provide guests with services such as cleaning, meals and room service. Non-serviced means that the customer is purchasing sleeping accommodation that is being offered to guests furnished on a rental basis. Frequently used types of non-serviced accommodation include self-catering apartments, holiday cottages and caravans. Many countries have devised official grading schemes and in Europe there has been an attempt to harmonise hotel grading criteria in an attempt to clarify standards for international travellers. Religion Some tourists will wish to travel to destinations in which the same religion as their own is widely practised. This might include visiting destinations for the purpose of pilgrimage. Others will deliberately choose to visit destinations in which a different religion is practised as part of a cultural experience. Challenges of the travel and tourism industry Seasonality Depending on where you are in the world, the demand for various tourism products and services will vary throughout the year, often reflecting the local seasonal climatic conditions. Figure 1.6 shows an important French attraction. Figure 1.6 Eiffel Tower, Paris in autumn Tourism in countries within the European Union (EU) shows the effect of seasonality very clearly in terms of: the pattern of tourism demand participation in tourism by EU residents the number of trips they made the number of nights spent on those trips. Seasonal variation applied to all aspects of trips made, regardless of whether they were spent in tourist accommodation (such as hotels or camp sites) or in less formal and often unpaid types of accommodation (such as owned dwellings or accommodation provided for free by friends or relatives). Research and analysis published in 2014 by the EU (Figure 1.7) clearly illustrates seasonal variation. Figure 1.7 Distribution of nights spent in the four quarters of 2014 Key findings of this European research were: Nearly one in four trips by EU residents were made in July or August. In August, 12.6% of all trips were taken and 10.9% in July. The number of trips in the peak month (August) was 2.6 times higher than the number of trips in the lowest month (January). When taking into account the duration of the trips, the seasonal pattern was even more pronounced, with EU residents having spent one in three nights away in these two months, August (17.2%) and July (16.1%). The number of nights spent in the peak month (August) was four times higher than the number of nights spent in the lowest month (January). In August 2013, EU residents made more than 88 million long trips of at least four overnight stays. This represents 18% of all long trips made through the entire year. The distribution of short trips over the year was more even. June was the most popular month for trips between one and three overnight stays, closely followed by December, May and March Figures 1.8 - 1.11, below show typical examples of popular destinations. Business trips are less season dependent, with business trips representing nearly 12% of all trips made by EU residents. This ranged from over 17% in November to 5% in the main holiday month of August. Nearly 40% of all tourism nights spent outside the summer peak months (July and August) were spent by Europeans aged 55 or more (the grey market). Figure 1.8 Traditional Dutch windmills with vibrant tulips Figure 1.9 London Bridge at night Figure 1.10 Beautiful Venetian scenery Figure 1.11 Skiers in mountains on a ski lift, Switzerland Seasonality causes problems for suppliers of travel and tourism products and services because demand levels fluctuate throughout the year. An empty hotel room does not generate revenue if it remains unoccupied and empty seats on a flight cannot be sold once the aircraft takes off. Many travel and tourism products cannot be stored for future use. Thus, suppliers seek to minimise the impacts caused by seasonal nature of demand by reducing prices in the shoulder months when demand is traditionally lower. If you look at any holiday brochure you will see that prices vary throughout the year and many consumers take advantage of 'low season' offers. KEY TERMS Shoulder months: the travel season between peak and off-peak seasons, especially spring and autumn, when fares tend to be relatively low. Intangibility Travel and tourism is a service industry. The service product is intangible when it cannot be easily evaluated or demonstrated in advance of its purchase. For example, a travel agent cannot provide for the testing or sampling of a tourism product such as a package holiday. On the other hand, a car or a computer game can be tested prior to purchase, and clothing can be tried on. Much of the selling of travel, tourism and hospitality is related to the promise of safe and timely delivery of any given product or service at an agreed location. The problem may be overcome by distributing a wide range of sales literature, by producing videos and giving virtual tours or by offering the product at discounted rates in an attempt to increase tangibility. Perishability Perishability simply means that travel and tourism service products, unlike other products such as manufactured goods, cannot be stored for sale on a future occasion. For example, a hotel bed or an airline seat unsold, or a convention centre left empty, represents lost revenue that can never be recouped. This illustrates the high-risk nature of the tourism industry. Marketers in the tourism and hospitality sectors have to devise complex pricing and promotion policies in an attempt to sell 'off-season' periods. The reaction to perishability is for marketers to try to smooth out demand curves by careful use of the marketing mix - for example, cheaper tickets for matinee shows. There is also a concentration on the use of computerised reservation systems in order to forecast the need for tactical action if demand is believed to be below expected levels. Yield management strategies are employed based on understanding, anticipating and influencing consumer behaviour in order to maximise revenue or profits from a perishable product. 1.2 Scale of the travel and tourism industry Travel and tourism is a truly global economic activity, taking place in destinations across the world, from leading capital cities and smaller towns and villages in rural and coastal areas, to some of the remotest points on the planet. It is one of the world's largest industries, or economic sectors, contributing trillions of dollars annually to the global economy, creating jobs and wealth, generating exports, boosting taxes and stimulating capital investment. KEY CONCEPTS Global and growing The new record of more than 1 billion tourists shows the scale of the industry. Predictions indicate that tourism will continue to grow at similar rates over the coming years, despite fears of terrorism, outbreaks of diseases and other such impacts. International tourism hit new records in 2015 despite the challenging economic, social and political conditions that have existed now for a number of years. International tourist arrivals were up 4% to reach a record 1.2 billion travellers worldwide in 2015. Figure 1.12 clearly indicates that the global travel and tourism industry is now directly responsible for 9% of the world's GDP. Figure 1.12 Why tourism matters Figure 1.12 clearly indicates that the scale of the travel and tourism industry varies between countries. The scale of New Zealand's tourism industry has already been considered when illustrating the differences between inbound and domestic tourism. We can now look at the scale of the industry in some other countries. Figures 1.13 and 1.14 show some aspects of world travel and tourism at the start of 2012. Figure 1.13 International tourist arrivals Figure 1.14 World inbound tourism 2011 (measurements shown in millions/mn) CASE STUDY 1 Maldives tourism industry Figure 1.15 shows clearly that the volume of international tourist arrivals has fluctuated over a 5-year period, with arrivals down significantly in 2009 following the global recession, and picking up again considerably in 2010 with a 20.75% total increase. Figures were affected in 2012 following a period of political unrest in the area. Figure 1.15 Tourist arrivals in the Maldives 2009-2013 However, 2013 saw a total of 1.125 million international tourists visit the Maldives, an all-time high, and this represented a 17.4% increase compared to the previous year. Tourism has for a long time been the major source of foreign exchange earnings for the Maldives. Tourism is an important contributor to employment generation and the economic growth of the country. The contribution of tourism to the country's GDP has fluctuated between 25.8% and 28.5% in the five year period from 2009 to 2013, as shown in Figure 1.16. Figure 1.16 Maldives top ten tourist markets 2013 Two additional indicators that reflect the health of the industry are occupancy rate of resorts and the average length of stay. The average duration of stay of tourists to the Maldives has declined from 8.6 nights in 2009 to 6.3 nights in 2013. Resort occupancy has been fairly consistent, ranging between 69.5% in 2010 to 74.0% in 2013. Key patterns in local, national and global tourism (including data interpretation and manipulation) The travel and tourism industry is measured through the collection of statistics and data. Many organisations are involved in the collection, collation and interpretation of huge sets of data relating to the size, scale and significance of the travel and tourism industry worldwide. Much of this data can be grouped under the following headings: Number of tourist arrivals in key destinations 'International tourist arrivals up 4% in the first four months of 2015. International tourism demand continued to be robust between January and April 2015 with tourist arrivals increasing 4% worldwide according to the latest UNWTO World Tourism Barometer. Almost all regions enjoyed strong growth. Prospects for the May-August period remained upbeat, with close to 500 million tourists expected to travel abroad during these four months. Destinations worldwide received some 332 million international tourists (overnight visitors) between January and April 2015,14 million more than the same period the previous year, corresponding to an increase of 4%. This result followed an increase of 4.3% in 2014 and consolidated the upward trend of international tourism in the previous few years (+4.5% international tourist arrivals a year on average since 2010). By region, the Americas (+6%) led growth, followed by Europe, Asia and the Pacific and the Middle East, all recording 4%-5% more arrivals. By sub-region, Oceania and South America boasted the strongest increase (both +8%), followed by the Caribbean and Central and Eastern Europe (both +7%), the latter rebounding from the previous year's decline. In Africa, demand weakened in 2014 after years of solid growth, affected mainly by the Ebola outbreak among other challenges. Limited data currently available for January-April 2015 points to a 6% decline, as African destinations struggle to recover from misperceptions affecting the continent (source: http://media.unwto.org/press-release/2015-07-08/international-touristarrivals-4-first-four-months-2015).' The earlier 'Maldives tourism industry' press release indicates the type of data analysis available in measuring the scale of international tourism. The World Tourism Organisation (UNWTO) and the World Travel and Tourism Council (WTTC) are two key sources of tourist arrival data. Key tourism generating areas and receiving areas (see 1.1 for the definitions of MEDCs and LEDCs) Traditionally MEDCs such as the United States, Canada, Western European countries and Australia produce the most tourists, although things are starting to change with the change in distribution of wealth. China and India are also likely to be major source markets for tourism in the coming years. Similarly MEDCs have traditionally played the part of tourism receivers, because of their advanced infrastructure and tendency towards political stability. Nowadays, tourists are prepared to travel further afield, take greater risks and see life in less well developed countries. This has given rise to emerging destinations in former LEDCs, such as Botswana which officially became a developing nation in 1994 and the Maldives which officially became developing in 2011. Tourists also visit LEDCs, often seeking to experience areas that are relatively untouched by tourism development. KEY CONCEPTS Change and development The statistics show the trend for emerging destinations and how tourism helps develop LEDCs. This is a fundamental benefit of tourism. Future Predictions The UNWTO's Tourism 2020 Vision projects that international arrivals are expected to reach nearly 1.6 billion by 2020. Of these worldwide arrivals in 2020, 1.2 billion will be intraregional and 0.4 billion will be long-haul travellers. East Asia and the Pacific, South Asia, the Middle East and Africa are forecast to grow at over 5% per year, compared to the world average of 4.1%. More mature regions - for example, Europe and the Americas – are anticipated to show lower than average growth rates. Europe will maintain the highest share of world arrivals, although this share will decline from 60% in 1995 to 46% in 2020. The total tourist arrivals by region shows that by 2020 the top three receiving regions will be Europe (717 million tourists), East Asia (397 million) and the Americas (282 million), followed by Africa, the Middle East and South Asia. Visitor spending in travel and tourism International tourism receipts earned by destinations worldwide have grown from a total of US$2 billion in 1950 to US$104 billion in 1980, US$415 billion in 1995 and US$1.25 trillion in 2014. Table 1.5 shows which countries spent the most on international tourism in 2014. While less than 6% of China's population holds a passport, the number of Chinese citizens taking trips abroad is growing. According to the World Tourism Organisation, this is in part down to an increase in disposable income, and appreciating currency, and an easing of restrictions on foreign travel. Chinese tourists are the biggest spenders overseas accounting for 13% of global tourism receipts (http://www.weforum.org). Total visitor arrivals 8 282 680 Average length of stay 9.12 days Average per person per day spending US$195.3 Average per person per trip spending US$1 780.50 Table 1.5 Data released by the Hawaii Tourism Authority in 2014 According to research carried out by the international credit card company, Mastercard, in 2012, visitors spent on average US$1 884 in the US, US$1 253 in Germany and US$1 249 in the UK. Visitors to Macau, the south-east Asian destination known for its casinos, spent a staggering US$3 213 each. The Hawaii Tourism Authority released the following set of figures showing the relationship between visitor numbers, average length of stay and visitor spending on the islands in 2014. The data was affected by nearly 125 000 arrivals by cruise ship; these visitors stayed in Hawaii for less time (an average of 5.3 days) and spent much less on average than other visitors to the islands (US$63 per day or US$334 per trip). http://www.hawaiitourismauthority.org Number of people employed directly and indirectly in the industry Front offices in hotels, restaurants, travel agencies, tourism information offices, aircrafts, cruise lines, resorts or shopping outlets provide direct employment because their employees are in contact with tourists and cater for tourist demand. Tourism also supports indirect employment in activities like restaurant suppliers, construction companies that build and maintain tourist facilities, as well as necessary infrastructure, aircraft manufacturers, various handicrafts producers, marketing agencies and accounting services. According to the World Travel and Tourism Council, in terms of employment, the importance of travel and tourism is pronounced. With 105 million people directly employed in 2014, travel and tourism directly employs: seven times more than automotive manufacturing five times more than the global chemicals industry four times more than the global banking industry four times more than the global mining industry double that of the global financial services industry. With a total impact of 9.4% of world employment, travel and tourism is one of the leading job creators in the world. Travel and tourism sustained 277 million jobs in 2014. As stated earlier in the chapter, this equates to 1 in every 11 jobs worldwide being linked to travel and tourism. KEY CONCEPTS Global and growing These employment figures show the importance of the industry on a global scale. Without this growth, many people would lose their livelihood and standards of living would fall. Governments will continue to encourage this global growth of tourism because of the benefits it brings to local economies. Trends in travel and tourism, including occupancy rates, duration of stay, method of transport Because of the dynamic nature of the industry, travel and tourism providers constantly use market research to try and understand the changing needs of their customers. Statistical data collated by national and international tourism agencies and authorities plays an important part in being able to understand the trends in travel and tourism. Data relating to load factors for transport providers, occupancy rates for accommodation providers and usage rates for tourist attractions gives a clear indication of how popular the products and services of these organisations are. Destinations will look at how long people choose to stay on average, and the methods that tourists use to travel to the destination, as all of this information helps travel and tourism providers make adjustments to their products and services to better meet the needs of their customers. It also helps with tourism forecasting, to ensure the industry is operating as efficiently and as profitably as possible. ACTIVITY 4 Investigate the scale of the travel and tourism industry in your country. As a starting point in your research, find your country's report as listed by the World Travel and Tourism Council at http://www.wttc.org/research/. 1.3 Factors affecting tourism Development of the modern travel and tourism industry In the MEDCs, tourism has evolved from an elite, minority activity some 200 years ago into a mass participation activity, accessible to and enjoyed by the majority of the population. This is a revolution that needs to be explained because it is a change which is gradually impacting upon a range of LECDs and is a fairly reliable barometer of economic growth and maturity within a country. Today, between 70% and 85% of the population of most western European and other developed countries participate in tourism, domestic or international - this is known as the tourism participation rate. By contrast, comparable figures for the world's poorest nations are in low single digits (2%-5%). Tourism participation in South Korea, Taiwan, Malaysia and Singapore have increased very significantly during the past 20 years, reflecting the major changes that have occurred within the economies of those countries. The participation rates in countries such as China and India are growing rapidly and, in real terms, the numbers involved with just a 5% increase in tourism in either country, means in excess of 50 million additional tourists seeking destinations to visit, accommodation to stay in and things to do. A range of factors can affect the travel and tourism industry, and we can now look at some of the most important ones. Economic factors: changes to the national economy and GDP Economic factors relate to changes such as costs and prices of goods, interest rates, wage rates, exchange rates and the rate of inflation. These all affect the ability of tourism businesses to generate profits and tourists being able to afford to travel. All countries experience change in their economies during the development process and one way to examine the relationship between economic growth and a population's standard of living over time is through the Rostow Model of Development. Rostow proposed that economic growth occurs in five basic stages, of varying length, as shown in Figure 1.17. Figure 1.17 Rostow Model of Development KEY TERMS Gross domestic product (GDP): a monetary measure of the value of all final goods and services produced in a period (quarterly or annually). GDP estimates are commonly used to determine the economic performance of a whole country or region, and to make international comparisons. Gross National Product (GNP) is similar to GDP but GNP includes the value of all goods and services produced by nationals whether in the country or not. Rostow described these stages as having particular characteristics: Traditional society: this is defined as subsistence economy based mainly on farming with very limited technology or capital to process raw materials or develop services and industries and so both GDP and per capita income levels are low. This is the situation in many of the world's poorest nations. Preconditions for take-off: are said to take place when the levels of technology within a country develop and the development of a transport system encourages trade. There is an increase in GDP and per capita incomes start to rise. Take-off: manufacturing industries grow rapidly, airports, roads and railways are built, and growth poles emerge as investment increases. GDP rises quickly as do per capita incomes for an increasingly large section of the population. These conditions characterise many LEDC nations at present as they actively pursue development policies. Drive to maturity: growth should be self-sustaining, having spread to all parts of the country, and leading to an increase in the number and types of industry. During this stage more complex transport systems and manufacturing expand as transport develops, rapid urbanisation occurs, and traditional industries may decline. This has been the experience of many of the 'Tiger' and 'BRIC' economies with sustained GDP growth and rising per capita income levels. Age of mass consumption: rapid expansion of tertiary industries occurs alongside a decline in manufacturing. This is the situation in most MEDC nations where GDP levels are high but growth is slow. Per capita incomes are high and large sections of the population have significant levels of disposable income to consume a variety of goods and services. Changes in the national economy in terms of GDP clearly have a direct influence on income levels among the population. Thus, as national economies develop over time, there will be a rise in per capita incomes and this will usually be accompanied by an increase in disposable income levels. This, in turn, increases a person's propensity to travel. KEY CONCEPTS Change and development The Rostow Model epitomises the concept of change and development within destinations. It maps out how a destination evolves over time, linked to economic development. Levels of disposable income To examine the relationship between economic development and disposable income levels, we can now look at how change has taken place in a selection of countries at different stages of the Rostow Model. Table 1.6 shows how disposable income per household has tended to change in the period 1995-2010 in various parts of the world. country 1995 2010 Percentage growth Brazil 11 985.5 16 373.3 37.3% China 1 456.6 4 809.8 230.2% India 1 597.9 3 140.2 96.5% Malaysia 11 297.2 17 509.9 55.0% New Zealand 26 622.4 30 361.1 14.0% Singapore 48 637.7 64 888.2 33.4% South Africa 10 391.0 12 252.9 17.9% United Kingdom 31 957.5 39 987.3 25.1% USA 53 914.5 61 028.4 13.2% Vietnam 1 043.0 2 392.0 129.3% Table 1.6 Disposable income US$ per household 1995-2010 These changes are very significant for the travel and tourism industry. The main variable that definitely influences tourist movements positively is growth in GNP. GNP growth increases disposable income and hence the willingness and ability to consume various goods and services, including an increase in tourist demand, whether such a demand refers to number of arrivals and number of nights spent or to amounts of tourist foreign exchange. The current situation is illustrated in Figure 1.18. Figure 1.18 GDP per capita against motor vehicles per 100 people Change in distribution of wealth Global inequality is growing, with half the world's wealth now in the hands of just 1% of the population, according to a new report. The middle classes have been squeezed at the expense of the very rich, according to recent research, which also finds that for the first time, there are more individuals in the middle classes in China (109 million people) than the 92 million people in the United States. Since the 1970s, the gap in wealth between the highest and lowest brackets of earners has grown, with 2% of the population previously owning a majority of global wealth and the bottom half of the population owning less than 1% of global wealth in the year 2000. At the end of the 20th century, wealth was concentrated among the G8 nations (France, Italy, Germany, Japan, the United Kingdom, the United States, Canada and Russia) and Western industrialised nations, along with several Asian and OPEC (Organization of Petroleum Exporting Countries) nations. Economists suggest that the BRIC countries (Brazil, Russia, India and China) hold the key to economic growth for the future. It is believed that China and India will, by 2050, become the world's dominant suppliers of manufactured goods and services respectively, while Brazil and Russia will become similarly dominant as suppliers of raw materials. Due to lower labour and production costs, many companies also consider the BRIC as a source of foreign expansion opportunity, and promising economies in which to invest. Changes in employment opportunities Global employment rates affect tourism, as those who are unemployed do not necessarily have sufficient income with which to travel. The unemployment rate varies significantly as Table 1.7 shows: Country Percentage of working age population not in employment as of December 2014 Bahamas 15.4 Botswana 27.9 Brazil 6.8 China 4.7 Greece 26.3 India 3.6 Maldives 11.6 Qatar 0.3 Russia 5.1 South Africa 25.1 Spain 24.7 United States 6.2 Table 1.7: Unemployment rates in different countries in 2014 With the advance in technology, many traditional jobs in manufacturing and agriculture have become automated. This has resulted in more people being employed in the tertiary or service industries, of which tourism offers significant employment opportunities. Changes in currency exchange rates Most major economies operate a floating exchange rate system, which means the currency's value is allowed to fluctuate in accordance with the foreign exchange market. Currency rates are influenced by a broad range of other economic factors including differences in interest rates, economic performance, supply and demand of currencies and inflation. The relative strength of the dollar against other major currencies will dictate whether tourists are likely to gain value for money when travelling overseas. Travellers to foreign countries have to convert funds to that particular country's currency so they can spend money at hotels, restaurants and other attractions. When the dollar appreciates against major world currencies, U.S. tourists travelling to other countries will be able to enjoy more because the exchange rate will favour them when they exchange their dollars for the local currency. Airports might have currency exchange boards similar to the one shown below in Figure 1.19. Figure 1.19 Currency exchange board Infrastructure development and improvement The development of tourism anywhere very much relies on the development of appropriate infrastructure, which service the needs of tourists and encourages investment in the sector. Infrastructure such as accommodation, restaurants, built attractions, tours and transport are primarily developed by the private sector. Private investors would be unwilling to invest in tourism facilities, however, without good airport and road infrastructure and the availability of affordable basic services such as water, sewerage, electricity, health facilities and telecommunications, for which the public sector is responsible. Governments recognise that infrastructure is a major stimulus to achieve economic growth, and to attract more visitors. This is why many governments around the world invest significantly in infrastructure development and improvement. CASE STUDY 2 Air traffic in India is projected to triple to 570 million passengers by 2025 from the current 190 million. Investments of $40-50 billion are required to expand/ upgrade airport infrastructure across the country to meet the demands for increased capacity. The government of India, recognising that it had neither the capital nor the expertise to embark upon an airport modernisation programme on this scale, initially proposed to develop and improve efficacy at four airports at Chennai, Kolkata, Jaipur and Ahmedabad through a publicprivate partnership. There are now plans to privatise airport operations at two of these airports, which will transfer the burden of investment away from the public sector. New terminals have been commissioned at Bengaluru and Mumbai, which together will add a capacity of more than 19 million passengers each year. Almost 70% of the population of India currently does not have air connectivity. Large numbers of people residing in smaller towns can afford to fly by air. The government is therefore taking initiatives to improve regional connectivity by planning more no-frills airports. The design and location for five such no-frills airports has been finalised, and construction began by the end of 2014. As a part of the strategy to encourage airlines to fly to smaller towns, the government plans to offer financial incentives to Indian carriers, including waiving of landing charges for aircrafts with a maximum certified capacity of less than 80 seats operating from non-metro airports. Officials said the government is also considering upgrading some airports in smaller cities into international airports. Airports at Bhopal, Indore and Raipur will soon be declared as International Airports. This will lead to more international lights arriving in smaller towns and will cut costs for fliers. This will spread inbound tourist footfall to a larger geographic area in India and open new destinations and products. KEY TERMS Private sector: usually composed of organisations that are privately owned and not part of the government. Public sector: usually composed of organisations that are owned and operated by the government. These includes national, federal, provincial, state or municipal governments. Social factors Social factors, such as religion, family or wealth, affect lifestyle. Tastes and fashions constantly change. Social factors also include changes in demography such as increased life expectancy or changes in the birth rate. Ageing population According to United Nations (2012) projections, the number of people aged 60 years or above will grow from 810 million in 2012 to nearly 2 billion by 2050, which means that every fifth person will be in this age group. Such a dramatic change in the age structure is already having major impacts on the world's economy and over the time it will be more and more evident. A demographic shift towards the older generation will change the needs of the average consumer and will thus affect global markets, in turn causing an overall change in the demand for products and services. Increased life expectancy and better pension provision has led to an increased number of wealthier older people with a disposable income. As a result, seniors ('the grey market') have become a broad and important group for the travel and tourism industry. These impacts will certainly influence the tourism industry since the 'grey market' have better health, more available income, no family obligations and more free time, which allows them to travel more often and for longer periods of time. All of these characteristics will turn this growing segment into a very profitable target market, which gives tourism providers the opportunity to develop specific products and services for them. Traditional Mediterranean coastal resorts (see Figure 1.20) such as Malta are currently investigating expanding their traditional beach holiday tourism by increasing the heritage element of their package to appeal to the older generation. Figure 1.20 A traditional Mediterranean coastal resort. Leisure time Today's use of leisure time and likely future trends are very different from the patterns established in the 1960s when economic developments in Europe and North America triggered the beginning of the modern era of tourism. The future development of tourism will depend on how the industry manages to compete with increasingly attractive options for spending leisure time. Until quite recently it was widely assumed, particularly in the richer countries, that working hours were steadily reducing, the amount of leisure time increasing and that these trends would continue. Many people looked forward to a golden age of leisure. However, changes in the world economy in recent years have made the situation much more complex. Currently, working conditions which specifically affect leisure time such as shorter working days, shorter working weeks, longer holidays with pay and age of retirement have taken on more significance. In some countries, increased life expectancy has led to an increase in pension age. For example, women's retirement age has traditionally been five years earlier than men in European countries at 60 rather than 65, but from 2016, this has been increased in line with the retirement age for men. By 2018 in the UK the pension age of both men and women will be 67, as it already is in other parts of the world. This will have a negative effect on leisure time. Generally, however, leisure time has increased in the past 50 years or so because of the following: Increasing the flexibility of working hours provided benefits to employees in terms of greater freedom to choose when to go on holiday. This is important for tourism as leisure time will be increasingly shaped by the terms of new, more flexible working hours. Paid leave in countries within the European Union was underpinned by the 1993 Working Time Directive which gave a right to four weeks' paid holiday from 1999 onwards. Although the leisure time of the retired has been modified by changes in retirement age and pensions, many individuals continue to retire younger and fitter than previous generations and have more leisure interests. The leisure of the younger generation is constrained by limited incomes rather than time but many young people take the opportunity to travel before embarking on their careers and the changing pattern of employment, with less emphasis on lifetime careers, encourages some to take further breaks between periods of work. Overall, the consumer behaviour is changing in response to these economic and social developments. Despite the squeeze on leisure time, the market response is not weakened, but a changing pattern of tourism demands towards shorter, more frequent and more intensive breaks. Increasingly flexible working hours including, in many countries, the substantial rise in those working at weekends, is changing the rhythm of leisure time. The work and leisure time of individuals, through the week and through the year, has become increasingly variable. However, young people and the retired will be the groups with most leisure time available for travel. Leisure time availability continues to be shaped by hours of work, public holidays, paid leave entitlements and retirement arrangements, all of which vary widely between countries. Each country tends to have its own national values and traditions in terms of the importance attached to leisure. These changes have resulted in the segmentation of people in terms of their leisure behaviour. Today, it is common to see reference being made to the following groups of travellers: Money rich, time poor: interested in a wide range of high style, high fashion, short breaks - city culture, total relaxation, the exotic. Their time is more valuable to them than their money. They expect excellent products that can be tailored to their tight schedules. Money and time rich: these include the affluent retired, free to travel throughout the year. Many will be sophisticated and demanding travellers, open to enjoying several widely different holidays each year, including luxury cruising and long haul travel but with many home - and perhaps second home - based interests competing for their time. Money and time poor: interested in a wide range of affordable holidays, often in the domestic market. Work pressures will incline them to get away for short breaks when they can, often at short notice. Money poor and time rich: often retired, interested in extended but inexpensive trips, including winter sun breaks, preferably with plenty of associated activities and, particularly for the young, backpacking. Rising middle classes in the East, declining in the West This links to the section on changes in the distribution of wealth under economic factors. This century, the wealth of the middle class has grown strongly in all regions and in almost all countries. Throughout the world, the size, health and resources of the middle class are seen as key factors in determining the speed and sustainability of economic development. Wealth is still predominantly concentrated in Europe and the United States. However, the growth of wealth in emerging markets has been steady, i