In late 2013, the ACT Government launched the 2020 Tourism Strategy. Since then, the document has generated more heat than light among industry players. Consequently, the Government has decided to hold an inquiry into the strategy. Part of the inquiry involves inviting submissions from actors in the industry and members of the public. This paper is prepared for submission to the inquiry. It is based on one of the sixth important issue for tourism in 2015: new technologies and how they can be used to enhance the tourism industry. The paper examines the background of the issue, its significance and influences on the strategy.
Background on the Strategy
The 2020 Tourism Plan was prepared by the ACT Government, under the auspices of VisitCanberra. The plan aims to include a context through which the tourism industry in Canberra will achieve its maximum potential (The ACT Government, 2013). Its aim is to lift Canberra’s overnight tourist income from the existing $1.58 billion to $2.5 billion by 2020. This target is aligned with the 2020 National Tourism Plan that targets to double the amount of money invested by overnight tourists across Australia from the figure of $70 billion in 2009 to $140 billion by 2020.
In-depth business market analysis was the foundation of the 2020 Tourism Plan (The ACT Government, 2013). The study project profiled the latest goods and experiences of tourism as well as the prospects for new ones. The plan would aim to realise its target across a variety of steps in the first short run. The first measure is to invest in marketing both local and foreign tourists to tourism attractions in the Canberra area. The second move is to carry out direct foreign flights and to develop the local aviation market. The third is to improve the industry’s technical potential. The fourth is to encourage businesses that supplement the tourism industry. Transportation and trade comprise these. Through removing hurdles to entry and holding statutory criteria to a minimum, the fifth step is to establish an encouraging market climate. Finally, the government would invest in the production of modern tourism goods.
The Government agrees that the aforementioned measures will not be carried out individually; they would enable all parties to collaborate and organise (The ACT Government, 2013). This involve travel agencies, legislative bodies and all the attractions that are sponsored by the Commonwealth. Another broad goal if the strategy is to promote the understanding and appreciation of tourism as an industry that can diversify and strengthen the economy of the ACT. In turn, its growth depends on the stability of all the others sectors such as commerce, education, and transportation. The strategy provides a vision for the tourism industry within the ACT by setting an attainable, measurable goal recognized by all industry players.
Background on the Issue
Information and communication technologies (ICTs) have occasioned a revolution in the way people around the world work, live and engage in leisure. More specifically, these technologies have brought a paradigm shift in the way individuals, organizations and nations conduct business with one another. One feature of ICTs is that they are very dynamic: a new technology today will be quickly replaced by another tomorrow. What this means is that the tourism industry must always be in the lookout for technological changes with a view to adapt to them promptly. A tourism business that is either unreceptive or slow to embrace shifts in technology might easily find itself out of business (United Nations World Tourism Organization (UNWTO), 2011).
Information and communication technologies have improved access to information. Over and above the traditional sources of knowledge such as the print and electronic media, much information is now accessible the Internet and through social media. What this means for organizations, including tourist organizations, is that they must be more accountable to their stakeholders(Mistilis & Dwyer, 2008). These stakeholders include their customers, investors, and regulators. Failure to be more transparent could result in undesirable consequences such as legal action being taken against the organization.
Besides ICTs, other technologies and innovations have a bearing on tourism. For instance, over the years, the transportation sector has witnessed major advancements. The general effect has been the reduction of the friction of distance between places, hence the opening up of localities to international visitors (Bodker & Browning, 2012). Whereas a hundred or so years ago a journey from Europe to Africa would take several months, today the same journey can be made in a few hours, thanks to the airplane. Moreover, the evolution of the shipping industry has opened luxury sea travel to many people who had been locked out by exorbitant costs.
The Significance of the Issue
The importance of new technologies to the tourism industry need not be overemphasized. The fact that ICTs have opened the floodgates of information means that the tourist of this day has access to plenty of pricing information (Berger & Greenspan, 2008). Besides the Internet, there are the social media. In addition, many leading tour operators have developed mobile applications that enable a tourist to access pricing and other information wherever they may be. This trend has served to intensify competition among tour operators. ICTs have also rendered some players in the tourism industry redundant. For example, the fact that a tourist can now access information about the country they intend to visit from their country means that they no longer have the need for the traditional tourist information centre.
As technology continues to evolve ever so fast, the modern day tourist is more techno-savvy than their counterpart of fifty years ago. Arguably, the Internet has revolutionized business, including tourism, more than any one factor has ever done. In addition, the modern day tourist has prior information about their destination company. Hence, it has become essential that tourist businesses learn how to handle the new breed of the tourist (Weeks & Culnane, 2001). However, the biggest challenge for most tourism businesses is how to identify and settle on the technology that suits their needs and those of their clients.
Western tourists have embraced technology more than anyone else (Liang, et al., 2013). These days, it is common for tourists to make all prior arrangements online. These arrangements include booking tickets and hotel rooms as well as transportation. This trend has far-reaching implications for tourist organizations. The trend has also led to the emergence and development of the so-called online tourist agents. Their business is to use technology to facilitate the movement of tourists and ensure their comfort while on the move. This means that tourist organizations must redesign their operations to align themselves with the changing behavior of the tourist. However, the biggest for tourist businesses is that not all technologies are appropriate to their businesses. The process of filtering through technological advancements to settle on the most appropriate is time-consuming yet has to be done within limited periods.
The Impact of the Issue on the Strategy
The goal of the 2020 Tourism Strategy is to raise the amount of money generated from overnight visitor from the current $1.58 billion to $2.5 billion per annum by 2020. The realization of this goal will largely depend on the willing of the visitors to spend in Canberra. This willingness, in turn, will be shaped with relative pricing of similar tourist destinations around the globe. The modern tourist is a rational consumer who has a lot of information on the pricing of tourist services and experiences around the world. As a result, if they are convinced that they can get the same experience elsewhere at a lower price, they will tend to gravitate towards the alternative destination (Ruhanen, et al., 2013). In the event that tourists migrate on a large scale to other destinations for their competitive pricing, the achievement of the goal of the strategy will be jeopardized.
One would expect that a significant share of the $2.5 billion worth of overnight tourist spending would go to government coffers in the form of tax revenue. This tax revenue would in turn be used to support the tourism industry. For instance, the ACT Government would use part of the revenue to meet the short-term measures outlined at the beginning of this paper. One of the strategies is to boost the capacity of the local aviation industry while making it affordable to more Australians. Hopefully, increased local air travel would promote local tourism, hence increased spending on overnight accommodation. However, technology has brought about shifts in the way global consumers pay for goods and services (Pansiri & Courvisanos, 2010). Notably, today there are a number of online payment and money transfer services. This represents a major shift from the tradition where transactions were processed through the banks.
Under these changing circumstances, it is expected that the government will considerable difficulty in ascertaining the revenues earned and profits made by tourist organizations for the purpose taxation. Some unscrupulous operators may understate their sales revenues and profits in order to pay significantly less in taxes. This point raises another question of how the Government intends to measure the overnight stay earnings in Canberra in light of the technology driven payment systems. A few years ago, the task may have been a relatively easy one. By 2020, one would expect that online payment and money transfer platforms would have gone a notch higher making it even more difficult to measure revenues. The strategy is silent on this matter.
The social media provide a powerful tool, which the Government, through VisitCanberra, can keep the city and the wider region alive in the minds of local and foreign visitors (Lee, 2011). The strategy recognizes this fact. If well utilized, the social media can significantly increase the chances of realizing the goal of the strategy. Having said this, one must quickly add that on its own, the social media will not deliver the $2.5 billion by 2020. The tool must be accompanied with other pillars of the strategy that include the development of new tourist experiences. Otherwise, the rational consumer will discover that Canberra has nothing to offer apart from the hype on social media. They will shift to other tourist destinations around the world.
The Government recognizes that the successful implementation of the strategy cannot be realized single-handedly: it will take both the public and private sectors. While this statement may be true, a look at the strategy does not reveal that industry stakeholders were participated in the formulation of the strategy. This could mean of two things: either the stakeholders were consulted, but the methodology part of the strategy was omitted, or they were not consulted at all. The latter is more probable. Hence, the Government should consider reformulating the entire strategy and engage all actors throughout the process.
The ACT Government, more than anything else, should concentrate on developing new tourist products and experiences. Having developed them, the Government should market them fiercely to Australians and foreigners alike. This is the surest way of achieving the goal of the strategy. With unique experiences that cannot be found anywhere else in the world, both the local and international visitor will be weighed down less with the consideration of price. The development of new products in the tourism industry is one of the objectives of the strategy in the shorter run. What remains is for the Government to creative a supportive environment for the private sector to fulfill this objective.
The Government should put in place robust systems in order to be able to measure the progress of the realization of the goal of the strategy. This recommendation takes into account the recent advancements in online transactions. In the next six, one can expect the nature of online presentations to be more complex. Without the system, it will be difficult to measure progress. There are likely to be some dishonest operators who may falsify their earnings in order to pay less in taxes. This will call for a lot of innovativeness on the part of the Government.
- Berger, I. & Greenspan, I., 2008. High (on) Technology: Producing Tourist Identities through Technologized Adventure. Journal of Sport and Tourism, 13(2), pp. 89-114.
- Bodker, M. & Browning, D., 2012. Beyond destinations: exploring tourist technology design spaces through local tourist interactions. Digital Creativity, 23(3-4), pp. 204-224.
- Lee, B. C., 2011. The impact of social capital on tourism technology adoption for destination marketing. Current Issues in Tourism, 4(2), pp. 1-18.
- Liang, A. R.-D., Chen, S.-C., Tung, W. & Hu, C.-C., 2013. The Influence of Food Expenditure on Tourist Response to Festival Tourism: Expenditure Perspective. International Journal of Hospitality and Tourism Administration, 14(4), pp. 377-399.
- Mistilis, N. & Dwyer, L., 2008. Information Technology and Service Standards in MICE Tourism. Journal of Convention and Exhibition Management, 2(1), pp. 55-65.
- Pansiri, J. & Courvisanos, J., 2010. Attitude to Risk in Technology-Based Strategic Alliances for Tourism. International Journal of Hospitality & Tourism Administration, 11(3), pp. 275-302.
- Ruhanen, L., Moyle, B. & McLennan, C.-L., 2013. Strategic Issues in the Australian Tourism Industry: A 10-year Analysis of National Strategies and Plans. Asia Pacific Journal of Tourism Research, 18(3), pp. 220-240.
- The ACT Government, 2013. The 2020 Tourism Strategy, Canberra: ACT Government.
- United Nations World Tourism Organization (UNWTO), 2011. Technology in Tourism, Geneva: United Nations World Tourism Organization (UNWTO).
- Weeks, P. & Culnane, J., 2001. Technology by Degrees. Journal of Teaching in Travel and Tourism, 1(2-3), pp. 39-62.