7.1. competition tourism destination new

1. Welcome to
Competitive
Tourism Destination
Conceptual Models Developed
to enhance Competitiveness
Dr. Myrza Rahmanita, SE, M.Sc
[ ]

2. COMPETITION AND THE
TOURISM DESTINATION

3. The idea of the
competitive destination
contains two elements
Destination
and
Competitivene
ss

4. DESTINATI
ON

5. COMPETI
TION

6. Elements of destination competitiveness

7. Effects on destination competitiveness

8. After you have knowledge
about elements idea
of the competition, next
you will learn model
competitive forces of M.
Porter.

9. What is
Model Competitive Forces
of M. Porter?

10. MODEL
COMPETITIVE
FORCES OF M.
PORTER
The price-competitiveness approach of
Dwyer, Forsyth and Rao
The Bordas demand model
The WES approach
The Poon concept

11. The conceptual model of destination
competitiveness of Ritchie and Crouch
The ‘Porter diamond’, or the determinants of
competitive advantage
The competitive forces and generic
strategies of M. Porter
MODEL
COMPETITIVE
FORCES OF M.
PORTER

12. MODEL COMPETITIVE FORCES
OF M. PORTERThe competitive forces and generic
strategies of M. Porter1

13. MODEL COMPETITIVE FORCES
OF M. PORTERThe ‘Porter diamond’, or the
determinants of competitive
advantage
2

14. MODEL COMPETITIVE FORCES
OF M. PORTER
3 The Poon concept

15. TheWES approach
( Exchange rate currency X in currency unitsY) [
𝐶𝑃𝐼 𝑐𝑜𝑢𝑛𝑡𝑟𝑦 𝑋
𝐶𝑃𝐼 𝑐𝑜𝑢𝑛𝑡𝑟𝑦 𝑌
]
MODEL COMPETITIVE FORCES
OF M. PORTER
4

16. MODEL COMPETITIVE FORCES
OF M. PORTER
4 TheWES approach

17. The Bordas demand model
MODEL COMPETITIVE FORCES
OF M. PORTER
5

18. • EC= economic/monetary cost
(transportation, costs at the spot)
• PhC= physical cost (tiredness and
stress)
• PsC = psychological cost
(commercial and physical risk)
• PuC = purchasing costs or cost to
get access to information and to the
trade)
• MS= magnetism of the sales
system (capacity of the sales system
to create interest in the destination
and capability to attract customers)
• CS= conductivity of the system or
the capacity to close a sale (which
percentage of customers who were
in contact with the sales system,
decided to buy the destination)
• PSSE= post-sale service efficiency
(creating loyalty and
recommendation).
MODEL COMPETITIVE FORCES
OF M. PORTER
6

19. MODEL COMPETITIVE FORCES
OF M. PORTER
7 The conceptual model of
destination competitiveness of
Ritchie and Crouch

20. MODEL COMPETITIVE FORCES
OF M. PORTER
8
MODEL COMPETITIVE FORCE OF M.PORTER
The price-competitiveness approach of Dwyer, Forsyth and Rao
Price competitive index =
𝑒𝑥𝑐ℎ𝑎𝑛𝑔𝑒 𝑟𝑎𝑡𝑒
𝑃𝑃𝑃
X
100
1
For further explanation seeThe Economic ofTourism
Destinations page 125

22. The threat of
entrants
New entrants may stimulate
more price competition, or
more attention may be paid to
product differentiation as they
attempt to win market shares.
1

23. 2 The power of
suppliers
 It is dominated by a few
companies (there is a degree of
monopoly or oligopoly) and is more
concentrated than the industry it
sells to (e.g. air charter companies
relative to tour operators)
The industry is not an important
customer of the supplying group
The group’s product is

24. 2 The power of
suppliers
 The group’s product is an
important input to the buyer’s
business (e.g. flight costs for a
tour operator)
 The group poses a credible threat
of forward integration (e.g. an air
carrier starts a tour-operator’s
business)
 There are high costs of switching

25. The power of buyers
■ If a buyer group purchases large volumes
relative to seller sales (the UK tour operator
business in Benidorm and other resorts in Spain
relative to the local hotel sector is a typical
example)
■ If the products a buyer group purchases from a
sector are standard or undifferentiated (e.g.
hotel rooms)
3

26. The threat of substitutes
The threat of substitutes can take very different
forms.
4

27. Competitive Rivalry
■There is slow sector growth
■There are high storage costs or perishability
■There are high fixed costs
■There is lack of differentiation
5

28. Competitive Rivalry
■There is a high strategic stake (to be successful
in one market)
■There are numerous or equally balanced
competitors
■There is over-capacity or big changes in
capacity
■There are high exit barriers.
5

30. Marketing startegy

31. DESTINATION
MANAGEMENT
4. Information/research Competition and
the tourism destination
3. Quality of service experiences (the
destination should provide a high-quality
visitor experience)
2. Marketing (traditional marketing
tasks)
1. Organization (administrative and
managerial tasks)
5. Human resource development

32. DESTINATION
MANAGEMENT 8. Resource stewardship (taking
care of the tourism resource base)
7.Visitor management (e.g. visitor
information centre, ability to deal with
crowds)
6. Finance and venture
capital
9. Crisis
management.

33. Synthesis of the main variables