Unit 1 Tourism Industry Assignment

Introduction

Tourism industry is a flexible industry that needs to adopt changes for meeting the customers’ needs and requirements. One can see that the tourism industry is considered as the most dynamic and competitive sector when compared to other industries and is continuously expanding across the globe with rise in its popularity amid customers and economic importance. London with around 30 million visitors every year has emerged as the most favoured tourist destinations across the globe. Reports suggest that London sees around 26 million overnight visits in total, which are mostly made by the visitors coming from various parts of UK. The tourism industry in London makes approximately 10% contributions in revenue generation of the city's gross value added income. An estimate value of tourists spends in London stands roughly £15 million per year. According to resources published in ‘London’s Economic Plan’ tourism industry gives employment to around 13% of people working in London.

This tourism industry assignment will focus on the various aspects of tourist destinations say for example, number of visitors, income generated, etc. and will discuss its future trends. Both economical and the political appeal to the tourists will be determined through this project thereby, revealing the features that a tourist destination needs to develop for earning more popularity and importance.

Task 1

Analyse main tourist destinations and generators of the world in terms of visitor numbers and income generation (AC1.1)

In this section, an analysis is made on some of the leading tourist destinations of the world in terms of visitor number and revenue generation. This is as follows:

• France: this European country is one of the top tourism hotspots in world with major contribution in national economy being generated from tourism industry. France is surrounded by port cities, villages, mountains and Mediterranean beaches and attracts worldwide tourists for its couture fashion industry, art museums and monuments. In 2014, tourism of France registered contributions of € 77.1 billion in Gross National Product i.e. nearly 3.6 percent of total income generation. Also, annual growth of 2.6 percent is expected between 2015-2025 which marks its strong popularity among visitors. In 2015, France reported 84.5 million foreign visitors with a 0.9 percent increase compared to 2014. (AFP, 2016)
• United Kingdom: this island nation in Europe is another popular tourist destination of world known to attract visitors due to its rich cultural diversity and heritage. In year 2014, the contribution from tourism industry in UK was reported around £ 61.9 billion, which registered 3.5 percent of national income. This growth is expected to increase with annual rate of nearly 3.2 percent until 2025. Also the number of foreign visits in UK in 2015 was reported around 36 million with visitor spending up to 22.07 billion dollars. In 2014, UK inbound tourist visits amounted to 81 percent of direct GDP as compared to outbound expenses, which was around 19 percent. Another popular trend noticed was leisure tourism, which generated around 58.5 percent of national income compared to business travel in 2014, which was around 41.5 percent. (World Travel and Tourism Council, 2015)
• China: this Asian country is growing steady popularity among global tourists due to its mix of historical architecture and modern infrastructure. In 2015, the inbound visit in China witnessed a steady growth compared to previous year with around 133 million visitor’s numbers. The direct tourism contribution was around ¥ 1620 billion in 2015 with share of 2.6 percent in total national income generation. The number of domestic visits in China was 3262 million in 2014 and international visits were around 55.69 million. The revenue generation from international tourism in China was around 45. 81 billion dollars and expenses from domestic tourists were about ¥ 2627 billion.  (Statista, 2016)
• Spain: this European country is popular among world tourists because of its regional geography, culture and medieval architecture. Tourism contribution of Spain in national income was around 58 billion Euros in 2015, which is predicted to grow by 2.3 percent by 2025. Also total contribution of tourism industry in Spain was reported to 161 billion Euros.  The number of international visitors in Spain in 2014 was around 64.995 million with foreign visitor spending generated around 47 percent of GDP and domestic spending generated 53 percent. (World Travel and Tourism Council, 2015)
• United States of America: this country is one of the leading destinations of travel in world with direct tourism contribution of 2.6 percent i.e. around US $ 458 billion in 2014 with forecasted rise of 3 percent by 2015 and annual 3.8 percent by 2025. In addition, domestic travel spending contributed 79.4 percent of direct national income in 2014 with foreign visitor spending generated to 20.6 percent. This grew to 3.2 percent increase in 2015 and another annual growth of 3.8 percent is predicted by 2025. (World Travel and Tourism Council, 2015)

Analyse statistics to determine tourism destination trends and predict future trend (AC1.2)

Tourism demands keep changing with emerging trends so these are significant to maintain consistent growth in tourism industry and visitor numbers. In addition, these are needed to maintain sustainability of tourist destination by developing new holiday packages and increasing revenue generation by finding new opportunities to attract visitors. In this section, tourism trends of UK will be discussed along with future predictions.

From the above figure, it can be analysed that direct contribution of Tourism in UK towards national income generation in 2014 was nearly £ 61.9 billion i.e. 3.5 percent share of total GDP which increased to 3.7 percent in 2015. Thus growth of 3.7 percent can be annually predicted by 2025. Also total contribution of travel and tourism in UK to GDP is expected to grow by 3.1 percent annually till 2025. These statistics reflect that emerging trends in industries like hotels, airlines, travel agents and passenger transport services rose by 3.7 percent to £ 64.2 billion in 2015. Also tourism related products like restaurants and leisure services is expected to increase by 3.2 percent annually to contribute nearly 3.7 percent of GDP by 2025.

 

From figure 2, it can be analysed that spending on leisure travel in UK both inbound and domestic contributed 58.5 percent of direct GDP in 2014 as against business travel spending, which had share of 41.5 percent to direct total GDP. This share of leisure spending rose to 2.9 percent in 2015 and is predicted to annually rise by 3.6 percent by 2025. Further business spending rose by 3.8 percent in 2015 with predicted annual rise of 2.7 percent i.e. around £ 80.9 billion by 2025.

The above figure analyses clearly the inbound visitor number trends by sector wise distribution. The share of leisure visits in UK being higher i.e. nearly 13.4 percent of total inbound visitor numbers, followed by business (8.3 percent), Visit to Friends and Relatives (VFR) is 9.6 percent and for purpose of study is 0.7 percent.

The activities that were popular trends for domestic trips were sightseeing, visit to beach, museum, ride, Country Park etc. Also trends that were popular for business trips were conference and meetings, exhibitions and fairs like cultural events, music festivals, sports fests etc. Also the total direct spending in events in UK was reported to 42.3 billion GBP in 2015.

Other future trends in international tourism with increase in number of international visitors can be seen in China with global tourism spending in Chinese markets standing to 1298 bn US dollars. These trends were predicted with growth in disposal expenses, minimum foreign travel or Visa restrictions and strong growth in Chinese currency. Countries that ranked second and third were USA and Germany respectively. (UNWTO, 2014)

According to UNWTO Tourism towards 2030, the number of foreign visitor arrivals worldwide is expected to rise with average of 3.3 percent annually by 2030. The emerging destinations would be Asia, Latin America, Central and Eastern Europe, Eastern Mediterranean Europe, Middle East and Africa. These destinations will grow with rate of 4.4 percent annually as compared to advance destinations which would grow at rate of 2.2 percent annually. The strongest of these destinations would be Asia and Pacific where visitor arrivals are predicted to rise annually at rate of 4.9 percent by 2030 to reach 535 million.

Task 3

Compare the appeal of current leading tourist with that of currently developing tourist destinations to be presented to marketing department to assist them in marketing activity (AC3.1)

One can easily compare in between a developing tourist destination and a developed tourist destination by evaluating the number of tourists making a visit to a certain destination within a financial year. In addition to the total number of visitors, data available with the certain location about the money spend by the tourists in the destinations is also helpful in making the comparisons and understanding the reasons behind such expenses. An organization operating in the tourism industry can reach its desirable targets by simply observing the reasons and successfully implementing them in its marketing activities. It has been observed that around 35- 36 million tourists from across the world make a visit to UK for exploring in nearby cities, London in particular thereby, making their annual spending approximately around 17.2 bn dollars. Every year tourists from US, other European countries rise, and their spending gives the economic condition of UK a high boost. Overnight visits are rapidly growing with a rise of about 7.8%, which the hospitality industry considers as a positive trend. Moreover, UK also saw a tremendous increase of 4% to 3.69 million of visitors coming from North American whereas nearly 7% to 25.83 million increase can be seen of European tourist. More and more people are planning to visit London for spending their holidays further making it a most sought after tourist destination. According to the figures provided from the Office of National Statistics, the year 2014 has seen a new record in the number of tourists visiting and spending in UK. 34.8 million tourists visited UK which was a 6% increases from the previous year and  have spend £21.73bn that is 3% higher than in 2013 making tourism as an essential part of the country’s wider economic success. (Donoghue, 2016)

From the discussion made earlier the below depicted statistics show the number of visitors coming in UK and their total spending

Various cultural aspects such as education, historic value, sports, entertainment play key role in attracting tourists in UK. Heritage tourism alone contributes around £7.4 bn to the country’s economy. For attracting more number of tourists, UK government has imposed easier and simpler VISA services. With the privatisation of Virgin Atlantic, transportation in UK has also evolved significantly. Government sponsored departments, agencies and public bodies have joined hands for attracting tourists from across the globe in UK. (Donoghue, 2016)

Tourism has emerged as a large-scale industry in Brazil with Rio de Janeiro and São Paulo as two preferred destinations for tourists as it takes them in the spectacular world of Brazil’s complex heritage and natural spectacle. During the Football World Cup, 2014 Brazil has received 6.4 million international tourists further making a record. With the curtain of 2016 Olympic and Paralympic Games in Rio, a significant amount of benefits can be seen on the economy of the city in the terms of increased production, service sector expansion, growth in jobs and wages and more tax revenue generation. It is expected that the impact of the games on the Brazilian economy has reached R$ 102 billion. Rio’s revenue from the foreign tourism market has grown from $1.26bn to $2.10bn thereby making the country make a grand entry into the Olympic games on a tourism market high. An estimated of more than 400,000 tourists visited Rio and has drawn to the city’s famous monuments, carnivals and landscapes further up surging the tours sales. (Turner, 2015)

For attracting more foreign visitors and driving tourism, Brazil has to overcome many challenges, the main is zika virus. With the virus is still active in Brazil, WHO considers it deadly to visit Brazil affecting tourism the most during the games. Brazil needs reconsidering of its infrastructural plans by taking serious account of tourists’ health and safety guidelines for overhauling the transportation system of the nation. Brazil is facing the worst recession because of the sinking prices of commodities, death of the mining boom and China and rest of Asia coming off the boil. The key issue Brazil is undergoing is corruption, which came to limelight in 2014 FIFA games. Brazil’s service sector is giving the economic condition a boost and contributes around 70% of the revenue further giving employment to 63% of its citizens. According to the World Travel and Tourism Council, tourism industry’s makes a direct contribution to the Brazilian economy with 3.5% of its GDP in 2014 that has further grown more 1.5% in 2015 and 3.5% until 2025.  (Turner, 2015)

It can be clearly stated that Brazil is making a constant effort in giving its tourism industry a facelift for enhancing the national income. The 2016 Olympics has given Brazil an added advantage for giving the tourist destinations a revamp.

Evaluate how characteristics of a tourist destination affect its appeal with reference to either Cuba, North Korea or Burma (AC3.2)

One can see that a country’s tourism activities are dependent on features that are helpful in creating interest amid the tourists coming from across the globe and act as their source of attraction. This question is answered with reference to an appealing tourist destination named Burma currently Myanmar.

Tourism has seen the face of light in Burma since it shifted from the 50 years of military rule further allowing the visitors in leaving a positive impact on the environment and its citizens. With the end of military rule, there has been a tremendous surge in tourists coming from US and Europe allowing the tour groups to increase their rates. With rise in tourism tour operators have entered into business contracts with hotels, restaurants, shops and airlines. Slow-paced cultural tours, independent travelling and customized travel packages for couples and small groups drive growth in tourism industry. Demand is no longer eclipsing the supply and in fact during 2015 winter, the price of hotels has fallen and tourists were able to get confirmed flights booking. (Theft, 2012)

Although Burma is less popular in comparison to Bagan, Inle Lake and the beach resort of Ngapali, its appeal lies in small pleasures like walking down lavish countryside into a teak village or the small-town market or interacting with the locals. The government in 2012 has made peace with the militias operating on Burma’s borders further attracting trekking in Hsipaw in  East Mandalay allowing the locals of Palaung to earn a stable income who until recently were dependent on farming opium poppy. As Ngapali is rapidly evolving into Burma’s Ko Samui, many insightful travellers tend to spend their time in isolated and peaceful Myeik Peninsula. The attractions for the first-timers include the great temple of Bagan, the grand finale of a short cruise in Irrawaddy River and temples and monasteries around Minnanthu. Independent travellers help the local communities by using their horse-carts for travelling and purchasing lacquer ware from the local workshops. Burma’s commercial heart Yangon is a major tourist attraction for its great golden Shwedagon Pagoda, magnificent antique of colonial heyday of the city is covered in the dense gardens and its lively street life and restaurants. (Theft, 2012)

Despite of earning a bad image as a tourist destination because of instable political conditions with change in rule, tourism has improved and its benefits are reaching the ordinary Burmese further allowing it in emerging as a primary tourist destination in South East Asia.

Task 4

Analysing issues that affect the popularity of tourist destinations (AC 4.1)

Tourist destinations popularity is dependent on its features, factors and environment. Visitors while planning a trip are often keen about the experiences they might gain. Experiences gained by the tourists will influence the visitor’s number in future. It is equally important to analyze the motive behind tourists’ visits, as it eventually will assist the local government in addressing the negativities and improving the key attractions. Most tourists make a trip to UK for indulging into various travelling activities depicted in the statistic. (Brown, 2012)

One can see that relaxation and spending a quality holiday is the prime intent of tourists visiting UK. Tourism in UK is driven by its excellent transportation system and the government’s combined approach. In past few years, UK’s tourism industry has been hit hard because of the global rise in terrorist activities and political unrest. Bookings to Spain and Portugal have increased tremendously in 2016 as UK travelers are opting for safer tourists’ destinations. The tourism industry is still paying the consequences of recent terror attacks in North Africa and mainland Europe. A survey conducted by Travelzoo reveals that approximately that 30% of UK travelers consider safety and security while planning for a holiday. (Brown, 2012)

World’s most deadly terrorist group ISIS is involved is spreading terror across the globe and recently have executed their terror activities in Belgium, France and Bangladesh, which has hit their economic conditions and the tourism industry. Political unrest in Egypt and terror activities by terrorist group like Ansar Bayt and Ajnad Misr has declined the tourists’ rate by around 80%. Recent terrorist attack on a cafe in Dhaka, Bangladesh has negatively affected its tourism industry, as tourists tend to avoid an unsafe destination. Tourists’ destinations popularity also hits low because of political instability. According to a survey, 29% of participants of tourism-sector consider political instability as a major threat, economic crisis by 24%, natural disaster by 23% and epidemic outbreak or new diseases by 22 %. In addition, cost in another key factor behind the decline of tourist destinations popularity. According to Travelzoo, Sri Lanka as a tourist destination is not much cost-effective. The hotels rates are high when compared to both its location and comfort. While planning trip tourists consider costs as a key factor and an unsatisfied experience surely damages the image of the destination as with rise in use of social media unhappy tourists share their bad experiences further influencing the holiday plans of other visitors. (Brown, 2012)

The potential for responsible tourism to enhance the host community at worldwide tourist destinations where TUI group operates with reference to Europe, Turkey ,Cuba, Mexico, Dominican Republic, Jamaica, Costa Rica, Egypt, and Thailand. (AC4.2)

The tourism industry is the most attractive sector with high economic contributions accounted by the foreign exchange. Its estimated direct contribution including accommodation, transportation, entertainment etc. in the country’s economy stands around 7.6 trillion dollars. Tourism industry provides maximum opportunities of employment as a service industry and is significant for areas, which needs surplus labour. Tourism and employment shares a positive relationship by maximizing the poverty terminus. Tourism industry is estimated of generating 9.4% of the GDP and 10% of employment.

Europe is world leader in tourism industry with a massive potential in attracting tourists from across the globe. EU excluding UK has recorded around 1.2 billion trips in inbound tourism. According to Travelzoo, 52% of tourists opt for Europe thereby, boosting its economy and the tourism industry. (Fadini, 2015)

Tourism is considered as the key sector in the growth of Egypt’s economy, provides employment to around 12% of unemployed people, and serves to roughly 15 billion visitors. An estimated turnover of the Egyptian tourism industry stands around $12.5 billion making contributions of more than 11% of GDP and generating 14.4% of foreign currency revenues. Key attractions in Egypt include Pyramids of Giza, Luxor's Karnak Temple and the Valley of the Kings, Islamic Cairo, Aswan etc. In recent years, political unrest has left an immense impact on the tourism industry. Reports sourced by the tourism ministry reveal that during dethroning of President Mohamed Morsi in 2013, the number of tourists’ visiting Egypt saw a deep plunge i.e. 9.5 million in comparison to 14.7 million in 2010.

Turkey’s historical sites and seaside resorts along Aegean and Mediterranean Sea and Istanbul are the key features attracting tourists’ from across the globe.  Turkey is a tourist hotspot especially for its culture, spa and health care tourism. In 2014, Turkey ranked as sixth most popular tourist destination in the world by attracting around 42 million international tourists however, the number declined staggeringly in 2015 to  36.2 million because of multiple terrorist attacks and political tension with Russia. (Centinel, 2009)

Thailand’s tourism industry is a major contributor to the economy with about 16% of contribution in the GDP in comparison to 12% in 2013. An estimated total value of tourism in 2014 stand around 19.3 percent of Thailand's GDP. Tourism Authority of Thailand has a significant role in endorsing tourism through its ‘Discover Thainess’ initiative. Growth in tourism has helped the hotel and retailing sector to make successive growth.  An estimated 30 million tourist visit Thailand mostly from China generating revenue of around 547 billion baht.

Tourism industry is the largest economic contributor of Mexico. Fusion of European and Meso-American culture makes Mexico attractive for tourists mainly from US, Canada, Europe and Asia. The key tourists’ attractions include Acapulco, Guanajuato, Cozumel, Loc Cabos etc. (Rebecca, 2016)

The annual tourists’ arrival in Cuba stands around 3 million making tourism as a key revenue generator in the island. Cuba with 253 protected areas, 257 national monuments, 7 UNESCO World Heritage Sites, 7 Natural Biosphere Reserves and 13 Fauna Refuge has emerged as the sought after tourists’ destination because of its favourable climate, beaches, dominion architecture and cultural past. However, a gloomy political relation with US has influenced its tourism activities. (Lindsontheroad, 2011)

Dominican Republic draws approximately 5 million tourists annually from across the globe making tourism as the key source of revenue especially in seaside areas. The equatorial climate, white sand beaches and mountainous landscape is a major attraction amid the tourists further making it a popular tourist destination in Caribbean region. The Key tourist attractions are Santo Domingo, Eastern National Park, Punta Cana etc. (Killian, 2005)

With 2.3 million foreign visitors in 2012 Costa Rica is the most visited country in the region of Central America further seizing a market share of 26.4% of tourists in the region. In 2012, foreign tourists’ receipts saw an increase of US$2.425 billion. Costa Rica is mostly engaged in ecotourism activities such as trekking, flora, fauna, bird watching and visiting to the rural communities. (Bien, 2010)

Conclusion