SW Associates, LLC: Sustainable Development through Tourism

Getting the most of e-tourism in Emerging Destinations by Scott Wayne and David Sterling

For destinations around the world, tourism can be a key to unlocking and stimulating growth, development and employment. It is one of the world’s most competitive and productive industries — the World Travel & Tourism Council estimates that in 2012, tourism directly contributed more than US$2 trillion to world GDP and generated at least 100 million jobs. Last year, over 1 billion people traveled and stayed overnight in a destination outside their home country. And the industry is forecast to grow 4.4 per cent annually over the next decade.

With more people traveling and more spending occurring at destinations, tourism offers an attractive option for economic development. This is particularly true for emerging market destinations where employment opportunities are limited. But, this option comes with strings attached: without planning and management by public authorities, local businesses and communities, tourism can easily transform once appealing places into noisy, crowded, polluted, inhospitable and ultimately non- competitive destinations.  While it is certainly possible and sometimes profitable to operate a hospitality business in an unappealing environment, logic dictates that when visitors feel more comfortable at a destination, they will spend more money there. Hospitable, well-managed surroundings do boost local development, employment and business.

When it comes to location development, destinations with deep pocket budgets can afford a “Field of Dreams” – “if you build it, they will come” – approach to developing such an environment. But, very few locations have this luxurious option.  Instead, most competitive and economically successful destinations develop based on careful planning and community consensus coordinated and managed by Destination Management Organizations (DMOs). Whether these DMOs are organized in private, public or partnerships structures, they can utilize a range of tools to promote, track and manage a destination’s competitive position. From visitor surveys to an assortment of internet and cloud-based e-tourism solutions, DMOs can leverage tools that maximize a destination’s profits, revenue and community benefits, while minimizing costs across attractions and businesses.

Applications of DMO e-tourism cloud-based solutions include tourism inventory and asset databases, online and offline visitor surveys, website and tourism trend analytics, and social media tourism marketing applications. These tools can help automate and enhance destination marketing and management efforts. However, few examples exist today that demonstrate the full potential of e-tourism solutions, particularly for emerging destinations. One approach that the authors are researching is a “virtual DMO” (vDMO™), which applies cloud-based e-tourism tools to the unique challenges of emerging destination management.  A virtual DMO requires fewer physical resources than a traditional DMO, simplifies data collection, and distributes information better among many types of users. A virtual DMO could, therefore, be the most cost-effective way of delivering significant value for emerging destinations.

Emerging destinations are often resource-challenged – short on the necessary human resources, management systems, technology and budget — to compete effectively and efficiently. A vDMO™, consisting of a distributed data collection capability and Destination Management System (DMS) “cloud architecture” can make it easier for  stakeholder and community engagement, as well as  deliver the following benefits for  destinations:
• Provide a lower cost alternative to existing investment approaches related to Tourist Information Centers (TICs) and logistical infrastructure
• Automate tourism asset mapping and stakeholder linkages
• Accelerate the collection of visitor data and feedback
• Automate the monitoring, benchmarking and recording of destination measures of  success

These benefits bring higher quality tourism offers, which lead to increased hotel nights and, when possible, increased spending on activities, souvenirs, food and beverages.  Ensuring that desired benefits and results happen requires the establishment of organizational structure and processes, development of funding and support options, creation of research and data management structures, as well as production of education and communication materials. All of these efforts could be supported in large part by a vDMO™ and its information support functions.
In addition to helping overcome resource challenges, vDMO™ also help tackle the following barriers to sustainable development:
• Weak data resource knowledge
• Limited ability to analyze trends and prioritize operational capabilities
• Limited ability to identify and link assets and stakeholders
• A lack of funding and thus insufficient commitment to allocating the necessary resources.

A virtual DMO helps to overcome these development barriers through application of its flexible and distributed information devices and processes. The resulting solution could help destinations:
• More easily collect hotel guest and visitor data
• Create a database of tourism-related stakeholders, including less direct stakeholders in the tourism value chain (i.e. suppliers in ancillary industries)
• Analyze visitor and supplier trends
• Benchmark destination elements and attractions against other destinations, thus providing a foundation for measuring, monitoring and evaluating performance
• Assist with innovative product development and marketing efforts

A destination could benefit from a virtual DMO when destination stakeholders – hotels, restaurants, attractions, parks, suppliers, etc. – want to better engage visitors and understand their needs, while managing operating costs. For example, a vDMO™ could help the following:
• A tourism authority that wants to lower Tourist Information Center (TIC) build or operating costs
• A DMO seeking more visitor interaction during their stays
• A Regional authority seeking data on visitors’ preferences and spending patterns
• Set of destination stakeholders desiring current information and engagement with their DMO

Other possible destination benefits occur in destination planning, development and marketing stages:

The Virtual DMO helps plan, develop, manage and market destinations

Destination Management Organizations help hotels, restaurants, attractions and tourist-related places, whether in well-established or emerging market destinations, compete more efficiently and profitably.  The authors believe that a vDMO™ could enhance the efficiency and cost-effectiveness of DMO functions, increase profits and employment for destinations, and simultaneously reduce public expenditures for tourism destinations. The authors will soon be soliciting proposals and approaching funding sources to establish a pilot vDMO™. They welcome comments from interested tourism-related businesses as well as aspiring and existing DMOs that want to participate in a pilot model for a vDMO™. The authors can be contacted at SWAssociates@verizon.net.

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