E-commerce in Travel and Tourism: Movement from traditional to e-tourism
According to Professor Dimitrios Buhalis, e-tourism is the digitization of all the processes and value chains in the tourism, travel, hospitality and catering industries that enable organisations to maximize their efficiency and effectiveness.
Keeping his definition in mind, we can't deny the fact that tourism industry is experiencing some change as a result of innovation lead by Information and Communication Technology adoption in this field. Some majorly changing sectors by tourism industry are discussed in this article.
Airlines: For decades, airlines have been heavily dependent on travel intermediaries. The Internet has changed everything, enabling airlines to find a way to bypass intermediaries to reach their customers directly and save money at the same time. Their first move was to cut commissions they paid to the travel agents.The airlines use strategies such as online pricing and incentives to lure travelers to book and plan travel on their sites.
Today, all major airlines own their own Web sites that are capable of taking reservations online as well as conducting other travel services. In fact, all major airlines are aggressively investing in the e-commerce, using all kinds of marketing strategies to lure customers to book and shop at their Web sites. At the heart of the popularity of online booking and reservations is the idea of customization of travel products and services. These online booking capabilities reduce costs by eliminating transaction fees and providing real-time reporting tools for travel managers. Before the Internet online reservation, this customization process was done through the travel agents, airline products and services are not that complicated to customize and therefore the Internet becomes a perfect channel of distribution of airline travel products and services.
Cruise Lines: Cruises are designed to replicate the many variety of amenities and activities available at the world's leading land resorts. To book a cruise requires the consumer to make a variety of major decisions that can include elements of three major travel categories; airlines, hotel and cruises. With the emergence of Internet e-commerce in the travel industry, the cruise lines were tempted several times to follow the airlines in offering direct online marketing and reservations.
Lodging: The lodging sector of the travel industry, though starting late in e-commerce, is fast catching up. Hotel industry room nights and revenue booked electronically in 2001 by travel agents and consumers grew at a rapid rate. This growth was spurred by Global Distribution System(GDS) booking both by consumers directly and through third-party travel Web sites such as Travelocity.com and Expedia.com etc.
Today, all major lodging chains have invested in e-commerce and information technology to various degrees. These investments include in-room high-speed Internet connections, online direct booking Web sites, and online procurement of services and products. Main adopters I need to list are Hyatt Hotels, Hilton, Marriott Hotel, and The Four Season Hotel etc. Small bed-and-breakfast properties, too, are either setting up their own Web sites or joining major bed-and-breakfast marketing sites.
Car Rental Industry: With its quiet start in the early 20th century, the rental car industry has gone a long way toward embracing technology. Beginning in the 1990s, the industry started to adopt technology to improve its reservation systems. Online booking and marketing of vehicles has helped rental companies streamline their business, increase its reach and efficiency and at the same time better serve the customers needs and wants. Rental car companies are targeting their Web strategies not only at leisure travel customers but also at the corporate travel market.
With advent of technology, booking and managing all these major services is being easier then ever before. Tourism players are going to web model with push type chain, keeping core value of travelers and travel service managers in mind and making them more customer centric. Brick and Mortar organizations are interfacing different genre of travelers by re-innovating their traditional business model. No doubt, this change is resulting in cost effective, time efficient and seamless delivery of tourism products and services to travelers around the world.