Digitalisation - Opportunities and challenges for the tourism sector

Save favourite 30 Jan January 2019

Digitalisation is an ongoing process in all areas of society and is evident in different ways. Within all sectors, it provides enormous opportunities but also presents challenges. The tourism sector is by no means an exception - quite the contrary.

Digitalisation within the tourism sector influences and alters entire cities and regions in ways which are hard to predict and complex to analyse. This is why Mid Sweden University as a whole, and the research centre ETOUR in particular, is conducting research on this issue.

Digitalisation has been going on for several decades

One could say that the digitalisation of the tourism sector began as early as the 1970s when it became possible to generate flight tickets electronically. At first, development went slowly and only small steps towards digitalisation were taken. In the ‘90s it became possible to book trips via the Internet but still most of the knowledge about the destination was to be found within the actual destination. Today there exists unimaginable amounts of information about activities and sights from all the corners of the world directly available and bookable in your hand, with smartphones and the Internet now well established the world over. But how does digitalisation affect tourists and destinations?

These changes have had a large impact on the aviation and hotel industries where the products are relatively standardised and easier to compare.

“If instead, you look at destinations, then you get a much more complex picture” affirms Maria Lexhagen, Associate Professor of Tourism Studies at the research centre ETOUR at Mid Sweden University.

Hard to control your branding

A destination comprises of a large number of players: travel agents, booking offices, restaurants, accommodation providers, tour operators, shops and activity providers. Everyone has their own brand to think about but it is simultaneously important to be a part of the destination's brand. Collaboration between businesses and organisations in different destinations might not be as digitalised as the target group they are trying to attract is, and this can lead to the visitors not getting the experience they were expecting.   

“You have to remember that guest experiences are a multi-faceted product at the destination and the offer is made up of maybe hundreds of different businesses and services” says Maria Lexhagen.

The digitalisation of information about businesses within destinations has fundamentally altered the way they work at reaching out to visitors and potential visitors alike, namely from having used printed marketing material to using digital marketing via the Internet. However, this means that it is now actors other than the businesses and representatives of the destination who, to a greater extent, are forming and spreading the message. One example from Jämtland is that of increased tourism to Lake Blanktjärn after a large number of photographs and videos about the lake went viral. The increase in tourism to the lake was hard to predict, which lead to problems such as a lack of parking places and infrastructure, and increased wear and tear on the paths to the lake. In other words, places can be surprised by a huge increase in the number of visitors and are thus left unprepared.

Another risk of digitalisation is that it becomes harder to create a holistic approach to destination information provision. Given that all the individual operators within a destination have the capability to reach out to as many or even more prospective customers as the destination’s own channels, it can be hard to create a clear image of the destination.  This is made harder by the fact that guests themselves can also create and disseminate information, for example, a review of a restaurant on Tripadvisor can have a much greater impact than the marketing that company puts online.

“When it is no longer only the product owners who are responsible for marketing, it becomes much harder for a destination to communicate a clear message to its target group” Maria Lexhagen comments.

Enables entirely new knowledge about the guest.

Today it is also possible to carry out far more detailed guest surveys, thanks to the digital presence of the guests. Instead of doing traditional guest surveys after a visit, it is now possible to measure behaviour and activities in real time. For example, through social media or smartphones, it is possible to gain access to very detailed information about what the guests think and how they behave. The challenge lies in analysing this data in a way that makes it useful for the destination.

“It’s becoming all the more common to look at tools which analyse what is written rather than just the number of likes for example” says Maria Lexhagen.

If the available data is used in the right way, it is possible to form a very solid basis for decision-making about destination strategies and activities; both when it comes to attracting visitors to the destination but also getting those who are already there to stay longer or enjoy themselves even more. Different kinds of tools for business intelligence in this field are still rare and therefore there is a great deal of potential for further development.

Hard to predict the future

In the future, greater demands will be made on destinations and individual businesses. Previously they collaborated at the destination level, but now they also need to collaborate in the digital world. New digital services are often groundbreaking and it might be that the next big breakthrough is just around the corner.

“There's a lot of exciting and important research to do in this field” Maria Lexhagen concludes.

 

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