TRM 253 Information Systems for Tourism Industry

1. An overview of current developments and major issues in the field of tourism and information technology Importance of IT for the various tourism organizations The impact of the Worldwide Web on traditional sales approaches models of technology use up-to-date properties of existing technologies inter-organizational systems in Turkey TRM 253 Information Systems for Tourism Industry Travel e22

2. Effects of the Internet on customer behavior: the new travel buyer • In 1997, thousands of travel agents in USA started to disappear... • Today..More than 65% of flight tickets in USA are sold online • Today, the internet processes a striking 52%of all hotel bookings. • 1.7 billion consumers have access to the internet and this number is growing by the day. gurkan ozer

3. The Internet is an ideal technology for travel. It offers a vast information resource, immediate convenience and interaction that can provide a very personal experience. As the Internet reaches to every house and business, it will find a huge market of travelers looking for information "Just Beyond their Imagination, and only a click away". • Today, Travel accounts for a nearly 35% (almost one third) of all annual online transactionsin the world • UK has already lost 2000 travel agents in the past 3 years, and there will be many more joining them…We are going to see fewer agents making money 5 years from now…Lots of big travel companies are going to be non-profit… • TURSAB must have 6000 travel agents; last elections in 2009 only 1400 agents voted for elections!... Travel e22

4. Today's challenge to all players in travel field is not in finding passengers, but in "finding profit". • International Tourism receipts reached 856 Billion usd in 2007 (WTO) • 2008 fact from USA hotel industry: 75-80% of hotel stays are not intermediated!... • According to a September 2008 released study by Prophis eResearch, an estimated 19 million online Americans have visited one of the top ten travel 2.0 traveler community based sites such as TripAdvisor in the past 12 months. • Yahoo Travel in a recent survey indicated 61% of people go on-line for travel Travel e22

5. WTO stats UNWTO's Tourism 2020 Vision forecasts that international arrivals are expected to reach nearly 1.6 billion by the year 2020. Of these worldwide arrivals in 2020, 1.2 billion will be intraregional and 378 million will be long-haul travellers. The total tourist arrivals by region shows that by 2020 the top three receiving regions will be Europe (717 million tourists), East Asia and the Pacific (397 million) and the Americas (282 million), followed by Africa, the Middle East and South Asia.

6. ONLINE DESTINATIONS

7. ONLINE DESTINATIONS

10. Online-Booking Travel Portals Basically travel portals started by selling budget airline tickets over GDSs. Their interfaces (API) softwares connect to GDSs such as AMADEUS, SABRE, and make possible to check availability online & real-time.. And therefore to sell.. Next, the giant hotel database being sold inside the GDSs became their hotels section! And the same for rent-a-car and all other providers, even theater tickets! In a very short time, it was clear that those GDS rates of hotels & ren-a-car companies were NOT SELLABLE.. Now, Travel Portals start to establish their own database of hotels, car rental agencies, bus-train tickets, etc. But this time, it is their OWN database, and their OWN PRICES... Meaning, no longer the AGENT commissions...Now they are giant TOUR OPERATORS on the web... Travel e22

11. Travel Portals : giant travel shopping centers of web.. http://www.travelocity.com http://www.expedia.com http://www.bookinturkey.com http://www.venere.com http://www.elong.net http://www.orbitz.com Travel e22

12. Beginning of IT use in tourism industry (CRS of Amadeus, Galileo, Worldspan) Basically travel portals started by selling budget airline tickets over GDSs. Their interfaces (API) softwares connect to GDSs such as AMADEUS, SABRE, etc. and make possible to check availability online & real-time.. And therefore to sell.. Next, the giant hotel database being sold inside the GDSs became their hotels section! And the same for rent-a-car and all other providers, even theater tickets! Travel e22

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14. According to a just September 2008 released study by ProphiseResearch, an estimated 19 million online Americans have visited one of the top ten travel 2.0 traveler community based sites such as TripAdvisor in the past 12 months.

16. Web 2.0 • Platform for participation, connecting people and enterprises • More sociable approach to creating and delivering content • Emphasizes open and transparent communication and • possibilities to use and recycle open source information

18. User generated content (UGC) will remain King. • Only 14% of users trust marketing messages, • whereas 78% trust recommendations of otherconsumers. • This highlights something many online marketershave known for a while: user generated contentcan be very beneficial. • blog comments, product reviews,video reviews, creative competitions, galleries, etcç

19. With more than 15million reviews andopinions and nearly30million unique visitors amonth, TripAdvisorclaims to be the largesttravel community onthe web.

20. Virtualtourist allows people to create and share blog-like pages Oftheir destinations,including tips and photos. Tips can be added to your own "Trip Planner", which allows you to create a personalized travel guide.

22. ICTs(Information & Communication Technologies) • Tourism is a very information intensive activity. Unlike durable goods, intangible and variable tourism services cannot be physically displayed or inspected at the point of sale before purchasing. Tourism services are bought before the time of their use and away from the place of consumption. • Tourism products are therefore almost exclusively depend on "representations & descriptions" . • Communication and information transmission tools are therefore indispensable to the global marketing of tourism industry Travel e22 Dimitrios BUHALIS - Information Technology for strategic tourism management

23. Tourism & ICTs • Tourism & ICT are 2 key catalysts for enabling dynamic, innovative and knowledgeable communities and organizations to communicate and interact with outside world in order to import expenditures & benefit. • Thus, tourism & ICTs increasingly provide strategic opportunities for powerful tools of economic growth, redistribution of wealth and development of equity around the globe. • However they also instigate new challenges and threads for players that are unable to cope with the developments and are left behind technologically Travel e22 Dimitrios BUHALIS - Information Technology for strategic tourism management

24. Tourism • Answer: Business Strategy & mission of organization should lead their processes and technological developments. • Question: Whether technological developments drive business strategies or visa versa? • However, it is also evident that unless management appreciates their technological strengths and weaknesses, they will be unable to implement these strategies. • It is only a matter of time before technological progress provides trouble-free solutions at justifiable costs. Technologies have been surpassing their initial expectations to become commonplace. Travel e22 Dimitrios BUHALIS - Information Technology for strategic tourism management

25. Information Management • Information Management enables organizations to develop systems and processes in order to transform raw data and input from the external and internal environment through software to meaningful & useful information which can support business processes & decisions.This is an ongoing process, requires feedback and adjustment at each stage . • Information Management(IT Dept.) is responsible for providing information and communication services and resources for the products and services, operations, management and control activities and co-operative work of an organization. • It is therefore charged with planning, developing, implementing, operating, and maintaining the information technology infrastructure and all applications of an organization.This is an ongoing process, requires feedback and adjustment at each stage Travel e22 Dimitrios BUHALIS - Information Technology for strategic tourism management

26. TourismDetermines the competitiveness of an organization. • Etourism is the digitization of all process and value chains in the tourism, travel, hospitality and catering industries that enable organizations to maximize their efficiency & effectiveness. • Etourism takes advantage ofIntranets for reorganizing internal processes; extranets for developing transactions with strategic partners, and internet for interacting with all the stakeholders. Travel e22 Dimitrios BUHALIS - Information Technology for strategic tourism management

27. Tourism • The key is to recognize where in the process these opportunities exist and to apply the appropriate level of technology. • The greatest problem when introducing new technology is that you can apply improved technology to a bad process. • On the other hand, the greatest gain and return are made when both process and the applied technology are optimized. • Time & Speed are the key factors of future business. Only organizations that create real value for their customers and partners will survive.. Travel e22 Dimitrios BUHALIS - Information Technology for strategic tourism management

28. Tourism • However, employing the right technology at the right time is DIFFICULT TASK. Technology and its applications move much faster than the decission making of corporations. • Sometimes it is much better for organizations to wait until the marketplace and technologies settled, rather than investing heavily on new technologies and get the associated risks. Try not to loose their positioning and marketshare. • They need to develop a close understanding and assciation with their target markets and use appropriateand affordable technology to serve their needs. Travel e22 Dimitrios BUHALIS - Information Technology for strategic tourism management

29. Tourism • Sales and intermediary organisations need to rationalise a selling tool (B2B or B2C) capable of real time operations • need to offer, without interruptions, only what is really available, as soon as availability shows up Travel e22 Dimitrios BUHALIS - Information Technology for strategic tourism management

30. Tourism – Stages of IT use • It is, therefore,proposed that technology use for the tourism industry is influenced by • (1)organizational properties • (2) personal characteristics of the leader • (3) the fit between technology and organizationalactivities Travel e22

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32. Tourism – Stages of IT use • The process of adoption and diffusion starts with a problem and/or the perceived need for an innovation (agenda setting) and continues with the search for a technology that is able to solve the problem (matching). • The initiation phase ends as soon as the right technology has been identified. • What follows is the decision whether to adopt or reject this specific technology and is referred to as the point of adoption. • The implementation phase starts when the technology has to be modified to fit organizational goals and, simultaneously, organizational structures and systemsare altered to accommodate the technological innovation(i.e., redefining, restructuring). Travel e22 Dimitrios BUHALIS - Information Technology for strategic tourism management

33. Tourism – Stages of IT use • Theimplementation process is completed when the relationship between the technology and the organization is clear and the innovationbecomes an integral part of the organization. • organizational capabilities influence the way technology is used in organizations. • IT diffusion involves complex interactionsbetween technologies and users in a given system. The properties of the system include both incentives and constraints to the use of technology. Adopter capabilities also influence how an adopter perceives IT . • Also, personal qualities of the leader (e.g., attitude toward change, vision for the future) have substantial influence on the use of IT. Travel e22

34. From an Internet marketing perspective; websitesdevelopmentstages ; • Stage 1 Web sites are pure “publishing sites” that only distribute data. There is limited dialogue between the Web site and the consumer because the Web is used like a traditional broadcast medium. Have low degrees of innovation and require little adjustment of organizational structures. Simple advertising strategies such as advertising banners and mass e-mail fall into this category. • Stage 2 Web sites concentrate on information. These sites are database driven and allow for more specific retrievals andask-respond interactions. More innovative and integrate more functions. Online auctions are one example for Stage 2 models. • Stage 3 Web sites are “personalizedinteraction sites” that stress relationship building. The concept of stages of technology use can also be applied to e-business models.E-business models are highly innovative, multifaceted, and integrated into the overall organizational framework.Virtual value chain integration and virtual communities are seen as models that have Stage 3 characteristics. Travel e22

35. Business Consumer Government B2B B2C B2G Business • Extranets between Travel Portals & Tour Operators: TO entering its tour info into travel portal. eg: www.BookinTurkey.com • Corporate Booking Systemeg: www.BookinTurkey.com • Travel Portals for end-user. eg:www.travelocity.comwww.expedia.com • Following and applying for taxes and regulations:www.maliye.gov.tr C2B C2C C2G • Airline, hotel loyalty, executive clubs • www.delta.com/ • www.hilton.com • Consumers informing other consumers over good or bad experience • www.sikayetvar.com • www.HolidayTravelWatch.com • Applying for visas, passport, etc. • www.egm.gov.tr/onlinepasaport.asp Consumer G2B G2C G2G • Government informing hotels & TO about new regulations. eg: • www.turizm.gov.tr • www.tursab.org • Government informing consumers about new regulations, Travel Adversories. eg: • http://travel.state.gov/ • Such as Turizm Bakanlığı with • WTO • www.world-tourism.org Government Dimitrios BUHALIS - Information Technology for strategic tourism management

37. TUI Booking.com Gezisitesi.com Sirkeci Otel ? Otel Travel e22

38. Inclass practice • What is the meaning of luxury travel for you? • What are the core objectives you are trying to achieve from with your website content? • Who are your customers? • Where will you find them 'hanging out' on Web 2.0? • How can you best enter into dialogue/conversation with them? Travel e22