and are frequent users of modern interactive and mobile technologies.
Across generations people want more quality from tourism experiences, including culture, nature, togetherness, health and some comfort. The spectrum of demands is wide, however, from the very active and participation vacations at the one end to visits to family and friends and shopping at the other end. People take short trips or long trips to one or more destinations and generally speaking, they want a more holistic experience.
In tourism, the growing number of middle-aged and old people has become increasingly important to the industry. They have got the money and inclination to travel. The age group between 25 and 44 years is still the largest traveling group of tourists in the world, but the age group between 45 and 64 is about to take that position, followed by the older people. Furthermore, the increasing share of older tourists will raise the demand for out-of-season travel. The number of handicapped travelers will increase, too, for the simple reason that many old people are handicapped. In Western Europe and the United States, probably a quarter of the elders is handicapped.13
Whereas the share of middle aged and older tourists is rising, the share of holiday travelers and business travelers for decades has been roughly the same, namely 80 and 20 percent respectively. In relative economic terms, the economic importance of business travelers is much larger, however, because on average each business traveler spends twice as much money as a holiday traveler.
Looking at people’s motive for traveling compared to pre-1990, travel patterns remain unchanged to a certain degree. Even though an increasing share of tourists travel to experience culture, sports and other such activities, the majority of West Europeans still travel in the summer time to the coast or warmer climates, at least for longer vacations. Many go for skiing during the winter vacation, too. City tourism is the second important goal for traveling. Out-of-season, tourist preferences are almost equally divided between nature, city and mountains. When including all short term travel, city traveling takes the leading place, however.14 This is clearly seen in the USA, where statistics on tourist travel and behavior is more detailed than in Europe. In the United States, shopping is the most important reason for traveling, followed by visits to family and friends.15 Many other and smaller tourism segments include, for instance, backpacking, hiking, biking, rural, adventure, eco, sex, and pilgrimage tourism.
Although tourists to some degree show common behavior according to age and motive, the increasing diversification of travel patterns makes it more and more difficult to categorize the nature of people’s vacations. How should we define a vacation, starting off with a cultural city tour and ending up at the beach or playing golf? And what about eco-tourism? Is eco-tourism when you from your hotel watch animals that cannot be reached by car, or when you leave your car to watch them or go for a bicycle tour? Is the growing interest in cultural city tours perhaps just a consequence of rising wealth or have people really become more interested in culture? Generally speaking, vacations to a much greater degree than previously combine a mixture of motives, while many people at the same time organize their own travel, taking advantage of the Internet. Furthermore, in contrast to the the tourism industry, tourists look at their vacation activities as a whole, whereas the tourism industry is divided into several separately specialized industries. No current industry or company comprises all the activities along the travel value chain of tourism. As we shall see, leading tourist corporations are seeking to cover more and more parts of the tourism value chain, however. Present-day tourism is certainly a buyer’s market.
Tourists choose their destination before giving thought to the services they want. A destination is a geographical area and has a content that meets the demands of a certain group of tourists. Destinations are the stages where tourists realize their dreams. Whereas tourists at the destination demand services as a whole, the service providers are divided into several separate industries and companies, providing accommodation food and beverage, attractions, entertainment, transportation, etc. The destination seldom involves only one company. The destination encompasses a combination of companies organized around attractions that add extra value to these companies and as a whole attract customers to the area. From the point of view of the customer or tourist, there is rivalry between destinations and not between companies with regard to a certain destination. But once the tourist has arrived at a destination, the local companies compete to attract him. That is why local companies and authorities cooperate in marketing their destination to national and international customers and the arrival of the Internet has truly made that possible.
The tourism industry is not only driven by new customers, new ways of organization and better means of transportation. Increasingly, the new technologies of IT, the Internet and mobile phones have caused changes on the demand side as well as on the supply side. Within tourist companies and between these companies an integrated system of information and communication has been established. By way of the Internet, all tourist products have been made available to consumers, too. They are now visible and comparable, which has created a transparent market. At the same time, the increasing outsourcing and division of labor has made all parties of the tourist industry establish consumer sales channels of their own. By way of the Internet, consumers are now able to book and buy flights directly from airlines, hotel rooms at hotels, rental cars at rental companies and insurance at insurance companies. And if consumers wish, they may also use a travel agency to organize all these activities. Via the Internet, it is possible sometimes to make arrangements with attraction providers also. The different parts of the tourist industry have reacted to the rise of the buyer’s market by extending their activities to include links to the whole tourist value chain. For example, airlines and ferries offer whole packages of travel and accommodation for summer and winter holidays. In other cases, operators containing cruise lines, amusement parks or other resorts seek to cover a whole vacation experience. All kinds of tourism services can be provided and obtained by way of the Internet and this has even paved the way for exclusive Internet tourist companies.
In all the current production and distribution of tourist services, information processing has become a clue to value creation in the tourism industry. Airlines, hotels, tour operators, travel agencies and destination companies all extend their activities and sales channels towards customers. In step with the redefinition and blurring of business borders, it is becoming still more important what activities you control in the tourism value chain and this has led to increased competition and remodeling of the tourism industry.
The Tourism Industry
The global tourism industry is big business. It accounts for almost four percent of total world GDP and its wider economic impacts are as high as some 10 percent of world GDP. The tourism industry embraces a number of functionally separate industries, including various forms of transportation (airlines, railways, cars, ferries, buses), accommodation (hotels, holiday homes, camping sites, etc.), food and beverage (restaurants, bars, etc.), attractions (cities, beaches, cultural monuments, museums, amusement parks, events etc.) and finally shopping (malls, fashion shops, etc.). While industries such as airlines, hotels and restaurants are clearly related to tourism and may be analyzed as separate industries, attractions and, even more, shopping are harder to picture precisely. In general, revenues of the individual tourism industries, and therefore total revenue, are based on estimates (Table 4).
TABLE 4 Global Sectors of the Tourism Industry in $bn and % shares, 2005
| $bn | % | |
| TravelAccommodationFoodAttractions | 600350250500 | 35201530 |
| Total Tourism Industry, $bn/ % | 1700 | 100 |
Source: WTTC. World Tourism Satellite Account. Estimates based on national satellite accounts and revenues presented below.
The Value Chain
The tourism industry includes several sub-sectors. One part of the industry mainly focuses on bringing tourists abroad while other companies
