Tourism Product Development  Policy and Government – Factor

includes stability, openness to tourism,

According to UNWTO and ETC (2011), it is a
priority given to tourism development,
process whereby the assets of a particular
form of government which indicates
destination are molded to meet the needs of
level of participation allowed in
national and international customers. It
decision making and policy on tourism
encompasses all the elements with which the
investment, etc.
visitor to a destination comes into contact. It
 Tourism in relation to destination’s
comprises only those attractions, activities and
overall economy – this comprises of
facilities that are specifically provided for the
level and quality of entrepreneurship,
visitors
innovation, and education, destination
Also, it can be defined as comprising only those stage in the TALC, Percentage of jobs
attractions, activities and facilities that are created by tourism, etc.
specifically provided for the visitor.  Acceptability to stakeholders
– Acceptance of different stakeholders
There are two key aspects to Tourism Product such as: community members, NGOs,
Development: national Government, Industry and the
 It is not an activity undertaken in a Local Government.
vacuum, but is part of an extensive and  Adherence to nationally accepted
interlinked process. standards
 Market Research, product development  Accreditation – is a certification issued
and marketing represent a continuum. to a tourism enterprise that officially
The failure to deliver any of these key recognizes it as having complied with
components will result in the destination the minimum standards for the
under-realizing its potential. operation of tourism facilities and
services (DOT).
Prerequisite of Tourism Product Development
Tourism Product Development Process
 Accessibility – The presence of
adequate transport infrastructure and  According to International Labour
independence from foreign operators. Office, Tourism product development is
Factors include: trip frequencies, seat designed to increase the income in the
capacity and transportation sector. Tourism product development
connectivity in the destination involves implementation of a
 Resources/existing products – range comprehensive plan of action that will
and quality of tourism resources, guide towards dealing with estimated
diversification, geographic increase in business over the short,
concentration or distribution of tourism medium and long-terms.
resources, supply and quality of human  The action strategies for the
capital. It is evaluated by: quality, development and management of tourist
authenticity, uniqueness and destinations should consider the needs
composition. and interests of all stakeholders in the
 Demand – The scale and trends of tourism system: local/ rural community,
current market demand, forecast entrepreneurs, investors, governments,
growth rate, ability of destination to tourists and other stakeholders.
offer products matching the tastes and Tourism Product Development Process:
characteristics of the market, etc.
1. Identify tourism assets.
2. Match assets with potential markets Product Development Practices
3. Make the product more inviting, such as by  Design the activities that are suitable for
providing infrastructure the place’s natural assets
 Take advantage of the terrain and other
4. Develop activities around the tourism assets.
natural features, such as zipline of
5. Develop tour packages. hanging bridge on a hilly area.
 Take advantage of man-made features.
6. Communicate benefits to target markets.  Turn disasters into a tourist product like
7. Develop a destination marketing organization voluntourism or dark tourism.
(DMO) Tourism Product Development Process  Create products from events.
 If the place has no distinctive natural
Tourism Product Development Principles: assets, develop man- made attractions.
 Hi-touch strategy – Personalize service
Tourism product development should:
quality and develop service styles.
 be authentic and indigenous reflect the  Hi-tech strategy – Use technology to
unique attributes of the destination. create exclusivity and an aura of
 have the support of the host community. sophistication.
 respect the natural and socio-cultural  Invent new product class.
environments by not damaging these in  Find use for a negative attribute (mud
any way. festival in Korea).
 be differentiated from competitors,  Use the Eco-brand in places which are
avoid “me too/copycat” developments. infrastructure- deficient.
 be of sufficient scale to make a  Advocacy – appeal to the tourist’s sense
significant economic contribution, but of justice, compassion and ethics.
not large as to create high economic  Localize – Go native • Celebrate local
leakage. products (ex. Crocodile meat in Puerto
Princesa)
Product Diversification Strategy  Complement do not compete (ex. Vigan
– Laoag tour package)
 Incorporate other activities into the main
activity

 Find niche; differentiate

 Provide certificates with accompanying
photographs to create a sense of
reaching a milestone (ex. Crown
Regency Hotel Sky Adventure
Experience).
  Discover the story behind the attraction PESTEL analysis is an acronym for a tool used
and use it for interpretation. to identify the macro (external) forces facing an
 Use unlikely places and materials. organization. The letters stand for Political,
Economic, Social, Technological, Environmental
The Present Situation Analysis
and Legal. Depending on the organization, it can
The overall priorities and policies for the be reduced to PEST or some areas can be added
tourism sector having been established, the (e.g. Ethical)
approach to the task of investigating the
ELEMENT OF A PESTEL ANALYSIS
potential for Tourism Product Development, and
turning the opportunities identified into  Political Factors - These determine the
successful and sustainable developments that extent to which government and
meet the market’s requirements for innovation, government policy may impact on an
differentiation and authenticity, involves a three- organization or a specific industry. This
stage process as follows: would include political policy and
stability as well as trade, fiscal and
• establishing the present situation;
taxation policies too.
•identifying the opportunities; and  Economic Factors - These factors
impact on the economy and its
• prioritizing the destination’s own tourism performance, which in turn directly
sector’s objectives impacts on the organization and its
profitability. Factors include interest
rates, employment or unemployment
rates, raw material costs and foreign
exchange rates.
 Social Factors - These factors focus on
the social environment and identify
emerging trends. This helps a marketer
to further understand their customers’
1. Where they are in terms of their political and needs and wants. Factors include
socio-economic development – the backcloth for changing family demographics,
tourism development. This is undertaken education levels, cultural trends, attitude
through PEST analysis – political, economic, changes and changes in lifestyles.
sociocultural, technological;  Technological Factors - These factors
consider the rate of technological
2.what their competitive position is, obtained innovation and development that could
through SWOT analysis – strengths, affect a market or industry. Factors
weaknesses, opportunities, threats; could include changes in digital or
3.where they are on the tourism area life cycle mobile technology, automation, research
(TALC); and development. There is often a
tendency to focus on developments only
4. Whether they are facing a challenge of in digital technology, but consideration
market development, product development or must also be given to new methods of
both through use of the Ansoff Matrix; and distribution, manufacturing and also
logistics.
5. Where their existing product range fits on the
 Environmental Factors - These factors
Boston Consulting Group Matrix (e.g. star,
relate to the influence of the surrounding
problem child, cash cow or dog)
environment and the impact of
 ecological aspects. With the rise in  Development stage is characterized by
importance of CSR (Corporate rapid tourism growth and dramatic
Sustainability Responsibility), this changes over a relatively short period of
element is becoming more important. time in all aspects of the tourism sector.
Factors include climate, recycling  Consolidation stage involves a decline
procedures, carbon footprint, waste in the growth rate of visitor arrivals and
disposal and sustainability. other tourism-related activity, although
 Legal Factors - An organization must the total amount of activity continues to
understand what is legal and allowed increase.
within the territories they operate in.  Stagnation stage is where peak visitor
They also must be aware of any change numbers and levels of associated
in legislation and the impact this may facilities, such as available
have on business operations. Factors accommodation units, are attained.
include employment legislation,  Decline where the destination will
consumer law, healthy and safety, eventually experience either an upturn
international as well as trade regulation or a downturn in its fortunes or
and restrictions. Rejuvenation where it is almost always
accompanied by the introduction of
Destination Cycles (TALC)
entirely new tourism products, or at least
The idea that destinations experience a the radical reimaging of the existing
predictable evolution is embodied in the concept product, as a way of recapturing the
of the destination cycle. This theory, to the destination’s competitive advantage and
extent that it is demonstrated to have widespread sense of uniqueness.
relevance to the real world, is of great interest to
tourism managers, who would then know where
a particular destination is positioned within the
cycle at a given point in time and what
implications this has for the future if no
intervention is undertaken.
The Butler Sequence
Butler in 1980 presented his S-shaped resort
cycle model, or Butler sequence, which proposes
that tourist destinations tend to experience five
distinct stages of growth (i.e. exploration,
involvement, development, consolidation,
stagnation) under free market and sustained
demand conditions (Butler, 1980).
 Exploration stage is characterized by
very small numbers of visitors who are
dispersed throughout the destination and
remain for an extended period of time.
 Involvement stage is associated with
strongly positive community attitudes
toward tourism.