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Tour Operations

Various Aspects of Tour Operations

Introduction to Tour Operations

According to WTO (World Trade Organization), tourism has become a main booster of economics source for both developed and developing countries throughout the globe. The tour operators organize, set together distinct elements of tourism experience and provide a complete package at reasonable price to clients. In UK, the tourism sector standard growth rate is 4 percent that is considered to be quite effective in comparison with other sectors in the nation. Here, the report is elaborating influence of existing development and trends on tour operators. It is followed by an explanation of stages adopted by tour operators and contracts made for offering package tours to different customers. The content is also explaining best promotion method to promote tourism activities to target segment. Moreover, the paper at the end is summarizing varied strategic and tactical decisions taken by tour operators in their daily work activities.

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Task 1

1.1 Effects of current and recent trends and developments on the tour operators industry

The main trends and development in the sector of travel and tourism are as follows:

E-commerce technological development

The tourism industry present development is depend on new E-commerce technology development. Such technology gives online information and attract wide customers base. The service of online booking has been very supportive as clients are able to make cancellation and reservation by encountering issue of distance.

Increase in power of spending

There has been an improvement in customers spending for tourism and travel and it has supported the whole tourism sector to develop as well as expand. Moreover, increase in customer’s expenditure has given UK tour operators with opportunities to gain more profits. Also, due to tourists spending local residents of country are getting several benefits.

Niche segment of tourism

The present sector of tourism is shaped by large number of niche segment. For example, the main tourist segment is newly married couples. Also, tour operators are concentrating on the particular segment, as they are giving high development opportunity and spending a big amount on tourism activities.

Customized packages of holiday

To allow clients to get advantages from customized packages of holiday, high flexibility is maintained by tour operator. To get maximum advantages, the tourists are able to select packages of their choice and get maximum satisfaction.

Changes in demographics

In the particular sector, the changes in customers demographics pattern has supported in opening novel horizon. The packages in this procedure are designed on the basis of client’s demographic condition.

Market research

The market research is performed by tour operators with an aim to outline customers demand and to determine various strategies that support them in meeting such demands as well as to increase their satisfaction.

PESTLE factors

These aspects shape the tourism sector. The main factors like political, economic and technological factors are influencing the whole industry. The customer would not consider money spending in destinations with poor stability in politics. The tourist choice to visit a particular place is also affected by currency prices, inflation and several other economic factors.

Focus on customer satisfaction

In the tourism sector, rather than giving customers with mere services, concentration is given to develop experience of clients. The tour operator’s main intention is offer such services that will attract customers and increase their revisits. To attain competitive edge, it is essential for tour operators to develop customer loyalty through increasing their satisfaction level. It will also support the company in retaining its customers share uninfluenced from market competition.

Government and other organization role

Support has also been provided by government for the UK tourism sector development and growth. Such support is offered in terms of flexible policies of VISA, relaxing norms of taxation for tourism activities and giving money for development of tourism destination. The other government and private companies that deals with tourism also help locals who resides near to tourist destinations.

Tourism marketing

The activities of marketing in tourism segment have aided to destination owners and tour operators by creating awareness in customers about specific spot attractiveness and service offerings. It enables the customers to have exact knowledge about the destination.

Focus on conversation

Together with objective of enhancing company’s revenue, the tourist operators also intend to conserve the attractive destinations of tourists for long duration. The non-government and government agencies plays a significant role in safeguarding such tourist places so that locals can have regular income from tourism activities taking place at these destinations.

Function in economy

Tourism is contributing a great percentage in country’s GDP as well as in overall economy. In addition to this, tourism is also supporting in increasing employment rate of UK.

Task 2

2.1 Stages and timescales involved in developing holidays

Planning is seen to be an integral section for complete tour activity development to fulfil needs of customers that are comprised in packages designed for them. The holiday package development in VIA ALGARVIANA and Las Vegas is quite time consuming and complex as well as may take around 12 months. For designing a package, various problems like tax structure and currency fluctuation are encountered and such problems should be properly handled. The stages to develop an appropriate holiday packages are given below:

New destination examining

It is an essential need to examine two destinations that are chosen in tern of complete external environment. This is the main step in designing entire tour and may take around period of 2-3 months.

Research

Consumer research is also required to be performed for two chosen destinations. For example, to design wedding package in Las Vegas, research is needed to be undertaken on several kinds of wedding ceremony features that can be proposed to clients. Similarly, consumers for package tour to VIA ALGARVIANA would be researched to identify tourism activities expected by them. Such procedure required time of at least two months.

Negotiation

Also, it is important to negotiate with various service provides in given two destinations to offer services like transportation, food, accommodation and several other facilities that would be expected by tourists looking for package tours. It will consume up to 4-5 months.

Tour development

It is the final stage in which package tour developed by conveying features to tourist and negotiating with providers of services to ensure newly designed package tour adequate promotions to global clientele base. The particular step will also take around 4 to 5 months.

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2.2 Suitability of different methods of contracting for different components of the holiday and different types of tour operator

There are two methods that can be employed by tour operators to book varied aspects of package tour designed by them. Such methods are fixed contract and sale only contract. In such project, the tour operators selected are Flight Centres and Air tours, which will be compared to make order of distinct types of services. These services will comprise accommodation, transportation and many more that tour operators arranged for customers. The following two contracting methods can be utilized by chosen operators:

Fixed contract

Organizations made such contracts to ensure volume based capacity use and increase the revenue collection during the off season. Air tours will make arrangement by fixed contracts depending on expectation of customers. The particular operator will book overall capacity by making payment on the basis of capacity utilized. Moreover, a risk for non-utilized capacity is included and operators have to pay for it as well. But, Air tours design packages by keeping in mind the fact that for tourist summer is a peak time to visit different places and there are less changes for non-utilization of booked capacity and due to this fixed contract will provide additional benefits of attractive discounts.

Sale only contract

This method will be selected by Flight Centres to develop package tour to South America. The particular package is developed for the niche segment of customers, as for expensive tours there will some definite interested segment of customers. Flight Centres in such contract type will pay hotel and transportation price used by clients. Basically, such contracts will be made during lean session to avoid risk of weak response for any package developed by Flight Centres.

After the analysis of above two methods, one can understand that the method of fixed contract can provide various advantages to tourists like ensuring availability of service and capacities as contract made in advance, high discount and pre-decided profit levels for the company. On the other hand, the sale only contract will enable tour operators to lessen expenses and profit loss by avoiding unutilized capacity payments.

Task 3

3.1 Planning decisions taken for the design of a selected brochure

Brochure in tourism industry is used to convey information and sell package tours by both off-line and on-line method. Thomas Cook will attain basic advantages related to high reach and low cost from tourism package brochure distribution. The brochure designing for current package requires adequate research, planning, organizing and implementation. The planning decisions in relation to Thomas Cook brochure is as follows:

Planning issue recognition

Various problems like brochure objectives, format and timescale plus target segment are required to taken into consideration for the effective brochure development.

Format

In order to make attractive brochure and enhance its visibility, it is vital for operators of tour package to pre-decide the format as well as match this with identified target segment.

Budget and target market

Depending on particular segment, like mass market or niche, the target customers for Thomas Cook will be find out. As budget is main aspect to be considered, so the customers spending pattern will also be determined by company.

Stages and timescale involved in designing brochure

The adequate time to design complete brochure will also be mentioned by brochure planning decision. The relevant stages to develop the particular brochure will be included in decision of planning as well.

3.2 Suitability of alternatives to a traditional brochure for tour operators of THOMAS COOK group

For the purpose of improving Thomas Cook cruise summer 2014 and Air Tours summer 2014 brochures quality and attract wide clientele base, alternatives of traditional methods can be used. The traditional brochure has been really an essential mode to convey information. But, the new technologies development in the current age enables operators of package tour to adopt some other mediums as well. An adequate method to convey information and designing brochure for customers is e-brochure. The online brochure has reach to mass market in comparison to physical brochure, which would be advantageous for Thomas Cook and Air tours. One more benefit of e-brochure to tour operators is its cost efficiency. The overall cost to develop and design e-brochure is very less in comparison to physical one.

Besides this, another possible alternative for the above two tour operators is visual medium brochure, as it have great influence on people and can attract them towards the package offered by operators. The vital information plus destination’s visual beauty can be adequately conveyed by tourism industry through the utilization of visual brochure. Also, it will support in increasing sale of packages designed by tour operators. Moreover, video brochures can be used for the purpose of promotion by integrating it with tools of social media like YouTube and Facebook.

After the analysis of various e-brochure aspects, it can be suggested to Thomas Cook and Air tours that they should create an integrated brochure in which video brochure, e-brochures and online campaign of marketing are designed as well as linked effective with each other. All such tools integration to convey information to customers will also support in wide research together with effective implementation of best methods to promote tourist packages.

3.3 Suitability of different methods of distribution used to sell a holiday for different types of tour operator within the THOMAS COOK group

Both in past and present time, brochure has been proved to be an adequate way of selling holiday packages by tour operators. But, with the time passage there has been a modification in the brochure developing and designing system. In the present business scenario of tourism sector, the brochures development has become highly technology oriented. Thomas Cook group can sell holiday package through different channels, like direct sales, online marketing, call centre and telephonic sales, etc. The method of direct sale used for online brochure sale will be beneficial for tour operators wherein the company would be able to target a wide groups of customers by online marketing plus information can be conveyed through online source only. Moreover, the tool of e-mail marketing can also be used to sell holiday packages to target clients. Hence, it can be said after reviewing the above methods that both direct and online method are appropriate to sell holiday packages designed by Thomas Cook group to the potential clients.

Task 4

4.1 Strategic decisions made by different types of tour operator

The flexibility in system of tour operator includes large number of elements that support in increasing business profits. Several strategic plans and decisions are required to be taken on daily basis by tour operators. The strategic plans made by tour operators comprise adopting competitive strategy, price effectiveness and selection of definite customer segment that would be the possible targets of tour operators. The strategic planning is very important for organizations because it support in deciding future course of action. Some important strategic planning that would be undertaken by company is as follows:

Segmentation, targeting and positioning

It is very essential decision made by tour operators in which industry make segmentation, targeting is the task of organization while the positioning finalized by tour operators. The tour operators make final decisions on all such aspects after the analysis of their company’s competitiveness and likely customer segments that it wish to target. Such decisions are required to be made after adequately reviewing the situations as several other significant decisions related to place, promotion and pricing also based on STP strategy adopted by company.

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Discount pricing strategy

Price is taken as vital factor for tour operators. By employing fixed price contract, the operators can provide god discount to clients. Such discounts would support them in attracting consumers for their package tours and thereby make the able to attain competitive edge in the market.

Competitive pricing strategy

The pricing strategy of company must be competitive and tour operators should follow competitive pricing techniques to create dominant position in the market. This technique support in attracting potential customers and develop a base of loyal customers even in highly competitive market.

Seasonal aspect

There are different seasons associated with sales of different packages at range of prices. The season can be categorized as lean and peak as well as pricing for tourism actions must be chosen as per specific season.

Creative strategy of promotion

The creative tactics will support tour operators in promoting their package tours. In this procedure, the operators are required to decide about promotion method, the tool utilized and overall budget required for promotion. Such decision is very essential as the creative technique of promotion employed by organization add to business profitability.

4.2 Compare the tactical decisions that could be taken by a selected tour operator

The decisions taken by tour operators for handing daily activities of business in relation to package tour designing and sale can be referred to tactical decisions. These decisions type are very essential to ensure smooth functioning of business by tour operators. A few significant tactical decisions that tour operators made for adequate business functioning include organizing accommodation, conciliation with providers of service and maintain tie up with varied stakeholders who would be a part of complete value chain in providing customers with services related to package tour required by them.

One more tactical decision that tour operator is needed to made is in relation to association with many service providers. With an aim to make such decisions it is very significant for operators to follow corporate and personal selling tools. There is also a need to undertake meeting with varied service providers and then integration would be done on the basis of customers’ requirements.

Customer experience consideration by operators for package tour is other tactical decision making procedure in which methods and tools are used for understanding overall experience received by customers from tour packages offered to them. To get knowledge about customer satisfaction with present package tour, information is collected by operators. It also support them in identifying likely problems and solve them at the earliest. On the basis of identified problems, remedial actions can be taken to avoid further issues, which will also support in providing excellent customer experience and satisfaction from the design package tours.

Conclusion

The above report has provided insight into several aspects of tourism sector in relation to two pioneers, such as Thomas Cook and Air tours. The tour operators are expected to sell customized package holidays on flexible strategies of pricing. It will ensure more selling of holiday packages. The tour operations is same like marketing, designing, selling and negotiating that brings positive outcomes to the organization. Moreover, e-brochure is the well-known method used by tour operators in present business environment to promote their packages to mass market at less cost. This also supports in direct selling of packages to customers and improve their overall experience. In addition to this, various tactical and strategic decisions are required to be taken by tour operators in their routine business actions to ensure about quality service offerings and generate profitability for the organization.

References

  • Lyall, L., 2005. Travel and Tourism. [Online]. Available through: <http://www.educationscotland.gov.uk/Images/StructureofTTInd_tcm4-282180.pdf>. [Accessed on 18 February 2016].
  • McGrath, R.G. and MacMillan, I.C., 2000.The entrepreneurial mindset: Strategies for continuously creating opportunity in an age of uncertainty(Vol. 284). Harvard Business Press.
  • Middleton, V.T. and et.al., 2009.Marketing in travel and tourism. Routledge.
  • Middleton, V.T. and et.al., 2009.Marketing in travel and tourism. Routledge.
  • Newton, R., 2006. Management Step by Step: The Proven, Practical Guide to Running a Successful Project, Every Time. Pearson Education.
 

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