Envisioning destination models wp

Envisioning destination
models 3.0
<<TOURISM 3.0 WHITEPAPER SERIES >>
1. The new generation of destination business models 2
2. Integrating partners into the collaborative model 18
3. Strategies for a sustainable development 23
4. Comparative performance between different destination models 26
Jordi Pera Segarra
Envisioning Tourism 3.0 CEO
March 2016
CONTENTS

ENVISIONING DESTINATION MODELS 3.0
w w w . e n v i s i o n i n g t o u r i s m . c o m 2
1. The new generation of destination business models
Destination models 3.0 are conceived as collaborative models which intend to leverage the
creativity and know-how of all the stakeholder community to gain competitive advantage over
their competitors, by developing a large network of brand ambassadors who create and deliver
stories about the life-changing experiences that take place in the destination, in order to
engage new stakeholders in the pursuit of a mission that addresses the concerns of the
destination’s community. They are also triple bottom line models, as they account not only for
financial costs and benefits, but also for environmental and social costs and benefits. Usually,
the mission encompasses some of these issues:
 Fostering socio-cultural transformation through the promotion of healthier lifestyles, cross-
cultural understanding, mindset shifting in leadership culture, developing mindfulness, etc.
 Enhancing conservation and promoting the cultural heritage.
 Protecting the environment through education, innovation and deployment of sustainable
practices, and collaboration with partners’ environmental programs.
 Alleviating poverty through the empowerment of the communities in the base of the pyramid
to become micro-entrepreneurs and participate in the tourism business.
 Unlocking human potential through the empowerment of all stakeholders to participate in the
destination’s model innovation system with the creation of experiences and stories.
The model is a multi-sided platform which creates value by facilitating interactions between
tourists and local service suppliers, also attracting many mission driven stakeholders through
the network effect. Further, the collaborative business model intends to leverage and engage
the collective intelligence by:
 Creating life-changing experiences which directly or indirectly address the mission issues.
 Designing and developing marketing contents and materials to brand the destination.
 Revamping the business model as new challenges and opportunities come along.
 Sharing resources among the community and developing economies of scale.
 Leveraging the negotiation power of the community to obtain favorable deals with suppliers.
 Providing more professional development opportunities to community members.
From the operational perspective, the platform has a group of core businesses and resources
fully integrated –whose owners become platform shareholders-, and a group of businesses
which may choose among several flexible integration formulas to become part of the platform,
whose owners may keep control of their business and have the right to change their
integration status upon complying with specified conditions.
Therefore, the small local suppliers -restaurants, accommodation, activity organisers- operate
autonomously within the platform, taking advantage of the increased attractiveness of the
destination due to the story-based marketing, the platform’s services and support in providing
a higher-standard customer experience, and the aforementioned advantages of leveraging the
collective intelligence. In exchange, they have to comply with the obligations established
according to their chosen integration formula within the platform -see section 3 about
integrating stakeholders-, which would mainly consist of complying with service quality
standards and urban aesthetic guidelines, and contributing to the open innovation system.

In summary, the platform is in charge of several roles:
 Ensuring that tourism is developed in harmony with the cultural and natural environment.
 Managing and controlling service quality of all integrated businesses.
 Directing and managing the open innovation system and its outcomes.
 Providing facilitation and support to integrating businesses, especially to new entrepreneurs.
 Managing the incentive system to reward good service quality and contribution to innovation.
 Managing the bookings of all service businesses through a booking center.
 Managing the integration of all businesses within the platform.
As a result of the tourism 3.0 development approach, destinations integrate and engage all the
local community in the tourism activity, maximizing their collective human potential to develop
a vibrant and harmonious destination where visitors come to live authentic life-changing
experiences which ultimately address some of the stakeholders’ concerns.
The following sections explain in further detail the structure and operation of destination
models 3.0, and the detail of each of the building blocks that depict their rationale. Further, in
sections 3, 4 and 5 the main challenges in developing business models 3.0 and their
correspondent strategies are explained.
1.1 The business model canvas framework
The business model canvas is a strategic management template for depicting the rationale
through which a business creates, delivers and captures value. It is a strategy blueprint with
elements describing a business’ value proposition, infrastructure, customers, and finances to
assist business leaders in aligning their activities by illustrating potential trade-offs.
This business model framework describes the key components that define the business’ DNA:
 Competitive advantages & value proposition. Core strategic edges that provide
advantage over competitors, experiences provided to the tourists and mission based value
provided to all stakeholders. This should explain what differentiates the destination’s offer
from others, and so the reason why tourists should go and other stakeholders should
collaborate with the destination.
 Customer segments. The target tourist segments that the destination wants to attract,
based on criteria such as geographical markets, sociological and motivational profile.
 Customer relationships. The kind of relationships the business model wants to establish
with tourists, how to deliver the experiences and how to engage them with the destination.
 Marketing channels. The types of channels and marketing partners through which the
destination is to deliver the stories and other marketing contents to engage potential tourists
and other stakeholders.
 Key activities & management system. The most important activities to sustain the
competitive advantage through continuous improvement and execute the value proposition,
as well as the platform’s management system including strategic goals, performance
standards and metrics to measure the health of the business model.

 Key resources and organizational structure. The necessary assets to start operating the
platform and attracting stakeholders, which encompasses human, financial, physical and
intellectual resources. Every position is defined by its mission and key competences.
 Key partners. The network of partners which are necessary to deliver the value proposition,
as they bring along know how, resources and other value which are beyond the core
capabilities of the business model, but should not be internalized, in order to reduce risk and
costs, and to optimize operations.
 Cost structure. The balance between overheads and variable costs, determining the
potential to generate economies of scale or economies of scope.
 Revenue streams. The way the business model generates income from the delivered
services and products to different target clients and partners.
 Social & environmental costs. The negative impacts that the tourism business
development may cause in the natural environment and to the local communities. Hereby we
may remark also the negative impacts saved by the tourism 3.0 development approach, in
comparison with the usual practices.
 Social & environmental benefits. The positive impacts that the tourism development is
having both on the natural environment and local communities. They are to be measured
through a series of metrics to assess the progression on the mission accomplishment.
1.2 Competitive advantage & Value proposition
The core competitive advantage of destination models 3.0 is their unique capacity –built
upon the open innovation ecosystem- to create mission driven experiences and stories that
engage stakeholders to become brand ambassadors, as well as to adapt its business model to
changes in the environment, and to involve all the local communities in providing authentic
life-changing experiences, while alleviating poverty and protecting the environment.
In destination models 3.0, the mission, vision and values are embedded in the core of the
value proposition. Destinations 3.0 are known as scenarios where many stories take place
about authentic and life-changing experiences with the local population, which ultimately have
a positive impact on either the social, cultural or natural environment of the destination.
Moreover, visitors are encouraged to write and share their story in order to inspire more
people to live their own experience.
Hereby are listed some sample life-changing experiences classified according to the type of
mission accomplishment, which may consist on alleviating poverty, protecting the
environment, promoting the cultural heritage or fostering socio-cultural
transformation both in the community and the tourists.
 Environmental protection
 Tourism programs consisting of the natural heritage discovery while actively participating in
an environmental protection program in cooperation with NGO or other entities.
 Nature sightseeing and observation experiences accompanied by an expert
environmentalist educating them on the fragility of the natural heritage and the
environment-friendly practices.
 Educational programs for school students to learn about the key issues of environmental
sustainability in the area, combining both theoretical and practical focus.

 Heritage protection and promotion
 Learning about the local arts, language, cooking, dancing, instrument playing, etc. to turn
intangible heritage into a skill development experience.
 Immersive experience with cultural / ethnic minorities for a deeper understanding of their
culture, traditions and way of life.
 Poverty alleviation
 Accommodation with local families where to enjoy their home hospitality and have a
firsthand experience of the local reality.
 Sharing meals with local families, experiencing their way of cooking, their rituals and the
local food along with their hospitality.
 Enjoying other interactive experiences offered by locals who share their knowledge about
the hidden spots of the destination, local games, parties and tell stories.
 Socio-cultural transformation
 Accommodation and stay in religious sites such as monasteries and temples sharing the
lifestyle of the monks to develop spirituality and peace of mind.
 Developing communicative skills through storytelling training programs, and further
encouraging participants to write their stories, submit them in contests and spread them
through the social media channels.
 Developing creative activities that challenge and stimulate their imagination through art
workshops and contests, encompassing a broad scope of art disciplines.
 Multi-activity resorts where clients are educated on healthier lifestyles, learning about
balanced diet, physical exercise, meditation, etc.
It is essential to understand that the new marketing focuses on weaving values and mission
within the business culture, which is reflected deeply in the experiences and stories marketing
the destination, and ultimately obtains profits through the appreciation of the positive impact
that the business has on the society, the environment and the culture. It is through the
opportunity given to have this positive impact that destination models 3.0 target the
stakeholders’ human spirit. Furthermore, by empowering all stakeholders to participate, they
become accountable for the accomplishment of the mission.
Beyond the mission driven value proposition that sets destination models 3.0 apart from other
tourism development models, it may be necessary in many cases to target non-mission driven
tourists offering non-mission driven experiences to guarantee sufficient revenue streams all
year round, or to partially subsidize the mission driven activities. In such cases, the model
should prioritize the development of experiences that appeal to the affluent tourists and other
segments or niche markets that contribute in balancing the demand seasonality, assessing also
whether these tourists are likely to generate any additional negative impact either on the
natural or social environment.
In this section, there should be explained not only the competitive advantage(s) that sets it
apart from other destinations and the portfolio of experiences it intends to offer to visitors,
but also the vision, mission and its related goals, so long as they are the primary reason
for which mission driven stakeholders are to get engaged with the destination.

1.3 Customer segments
Beyond the targeting criteria according to the kind of tourism activities -nature, culture,
sports, etc.-, the primary target destinations 3.0 intend to attract and engage is the so called
“Creative society”. Creative people are the most expressive and collaborative
consumers, and also those who are most active in the social media, thus connecting and
influencing many other consumers and becoming a backbone in the local economies. They are
trusted and admired within their community, and through their concern and awareness
about the social impact of brands, they are to become our best brand ambassadors.
Because of their aim for self-actualization above other needs, and their desire to create and
collaborate, they are the ones who are most likely to become engaged with our value
proposition and to participate in co-creating experiences and stories for the destination. They
are those searching for spiritual fulfillment on top of other motivations, and this is what
unlocks the most of their creativity. Furthermore, they are trendsetters and change leaders
within their communities. They are the new wave of consumers who move the society towards
a more human centered world. They are Tourists 3.0.
In summary, the prototype of “Tourist 3.0” could be described as someone who:
 Is driven by the aim to make the world a better place, and for human spirit fulfillment.
 Belongs to communities, where he gets and shares information.
 Likes to co-create and collaborate with others in his favourite brands’ marketing activities.
 Is concerned about the impact of tourism on the environment and the local communities.
 Looks for authentic experiences through which he can develop new skills, learn about new
realities, cultures, and ways of life, which open his mind and ultimately change his life.
In the international travel market, there is nowadays an increasing fragmentation especially
due to the raise of special interest travellers. They are highly educated individuals driven by
cultural motivations in accordance with the life-changing experiences. Moreover, they are
among the tourists accounting for the highest expenditures in the destinations.
As it happens with all new business models and products, they are to take the role of
innovators and early adopters, both the adventurous ones who like to try brand new
experiences and the opinion leaders who observe the adventurous innovators and decide to
follow them once they are convinced about its benefits. They are the visionary consumers
who have the capacity to influence the mainstream ones about the benefits of the value
proposition, and so the primary strategic target to attract. They are change leaders and the
most receptive to new ideas and value propositions.
Even if “Tourists 3.0” are to become not only our most enthusiast customers, but also our
main brand ambassadors over time, many destinations may need to attract customer
segments other than them, at least during the early stages of their development or to balance
the demand seasonality, for it is necessary to describe these other targets precisely to develop
the appropriate marketing strategies. The tourists’ characterization should describe many
variables such as the main motivation(s), length of stay, demand seasonality, sociological
profile, etc. The Whitepaper Envisioning destination intelligence 3.0 explains in detail the
customer characterization, among many other issues.

In this section, the model should explain the kind of targets that the destination wants to
attract, specifying their strategic importance for the destination from the short to the long
term, in terms of expected engagement in the creation and delivery of stories, or in terms of
the revenue streams they generate to balance the demand seasonality, or to subsidize mission
driven activities or other segments. Customer segments should therefore be classified
according to their priority level, synthesizing the value they demand and the value and
revenue they bring in.
1.4 Customer relationships
The new marketing paradigm shifts from control to collaboration. It turns from vertical to
horizontal, as most consumers trust other consumers rather than businesses: word of mouth
and social media are at the core of new customer relationships. Businesses no longer control
their brands, as these are owned by the customers and are developed through collaboration
among them all.
All what companies do is aligning their actions to their corporate mission and empowering
costumers to become active agents in the accomplishment of the mission as brand controllers
and innovators, hence ultimately becoming brand ambassadors. To approach customers’
human spirit, these have to view the business as a change agent that strives to make the
world a better place according to their concerns. Then, as long as the mission is successfully
accomplished and there is a growing awareness about such accomplishment, the destination’s
brand becomes a symbol within the stakeholders’ lives.
Marketing 3.0 is based upon co-creation, communitization and characters. Customers and
other stakeholders take an active role in the development of experiences and stories through
collaborative innovation platforms. Starting from a generic experience, every tourist can tailor
it to his needs and motivations, and eventually share it with the community explaining his
story and thus nurturing the innovation system with new ideas. For a brand to become a
symbol, it needs that its stories create great characters with whom the stakeholders feel
identified, as they strive and manage to address the community challenges and concerns.
This open innovation system is the core of the destination marketing 3.0, becoming the
central hub where all communities get connected, and fulfilling the need for connection
with other consumers in communities. These communities are the ones which guarantee that
the business will ultimately serve the customer’s interests and concerns, and not just the
business profit. It is through this community initiative and collaboration that the platform
becomes a “content marketing machine” where people create, share and inspire each other to
live and tell new stories.
Finally, business models need to develop their unique DNA that reflects the brand’s identity
through the social networks, targeting the mind of the consumers and intending to be relevant
to their needs. Then, they have to stick to their brand promise delivering experiences up to
their claims, prioritizing the mission accomplishment, to keep the brand’s integrity and reach
the spirit of the consumers.

Failing to comply with the stakeholders expectations will eventually lead to losing their
credibility and hence their engagement. This should be complemented with a brand image
whose values appeal to the consumers’ emotional needs. All together is what leads consumers
and other stakeholders to experience, engage and eventually become brand ambassadors.
Only originality, integrity and authenticity will be effective.
From the operational perspective, such open innovation ecosystem would be based on
technological platforms –either existing or proprietary- where to held content creation contests
(photo, video, stories, poems, etc.) and collaborative creation processes to further refine the
content and integrate insights from various stakeholders.
In this section, the model should explain what kind of relationships it intends to establish
with each customer segment, whether they are to be passive receivers or active contributors,
specifying what kinds of contributions are expected (co-creation, story delivery, contest
participation and voting, etc.).
1.5 Marketing channels
The main marketing channels are the social networks where all the brand ambassadors
are spreading the stories, and the mission driven travel agents connected to like-minded
travellers. Other partners such as non-for-profit associations may also become channel
partners, as they can distribute the stories to their social circles and attract new stakeholders.
They are the ones with the best credibility to do so.
Channel partners will not only work as change agents and brand ambassadors, but will also
collaborate in the innovation platform bringing worthy ideas and market insights, thanks to
their deep knowledge of the outbound markets. For instance, they may bring information
about how other destinations are tackling similar challenges.
Furthermore, as mentioned before, it may be necessary to attract non mission driven tourists
and therefore use conventional travel agents to market the destination to these targets. This
will most likely be necessary in the early stage of development, when the destination has not
yet generated enough contents and stories to engage the desired targets. Travel agents will
therefore have a key role during the early stages of the destination’s development bringing key
insights for the strategic planning, and as key channel partners, to leverage their market
knowledge and marketing influence.
Other marketing channels to take into account will be the platform’s booking center and travel
portals as sales channels, whereas journalists and bloggers are likely to be key story deliverers
especially during the first years of the destination’s development.
In this section, the business model should explain the different channel partners and
marketing channels through which the destination intends to communicate its value
proposition and deliver the stories. It should explain the expected functions and strategic
importance of each channel throughout the short, mid and long term.

1.6 Key activities & management
Destination models 3.0 are complex in nature, and so it is the system of activities that need to
be coordinated and managed to sustain its competitive advantage and make the destination
model develop to the utmost of its potential.
 The open innovation system is the central activity that nurtures and sustains the
competitive advantage of the model, from which many kinds of outcomes are expected:
 Business model innovation: revamping the model through constant brainstorming,
reflection and discussion about improvements in either of the building blocks to achieve
current goals, or to analyze new approaches to pursue the mission, improve profitability,
streamline operations and adapt to the ever changing environment, foreseeing in advance
the upcoming challenges and opportunities. The collaborative system should empower new
leaders to drive new initiatives with the cooperation and support of the other stakeholders.
Participation is limited to qualified stakeholders, also considering crowdsourcing initiatives
opened to networks of external experts. Training on business model innovation
methodologies should be considered to set a common framework for facilitating discussion.
 Co-creation of experiences: opened to all stakeholders, this section should feature
vibrant discussions where mainly local entrepreneurs and enthusiast tourists exchange and
pre-test ideas on new life-changing experiences to be developed in the destination. There
could be contests to stimulate participation of the largest extent of stakeholders.
 Story creation: also opened to all stakeholders, this section could feature story creation
contests in many formats such as videos, podcasts, text to be developed individually or in
groups. Participation of bloggers would be encouraged through the organization of blogger
trips, especially during the initial stages of the destination’s development. This requires
particular attention from the platform managers, as it is the “content marketing machine”
upon which the destination relies to attract and engage new stakeholders over time.
 Marketing contents and designs: this section could encompass the development of an
image bank or several collections of designs, to be eventually used in merchandising or
marketing materials. Participation in this section could be stimulated through creation
contests or crowdsourcing of professional photographers and designers. For the image
bank, key influencers such as the “Instagramers” could be invited to the destination as
with bloggers and journalists.
Beyond the platform managers’ initiatives to invigorate the innovation system, individual
initiatives should also be eventually rewarded through a pre-determined incentive system. In
this regard, platform leaders should orientate the innovation efforts towards the mission driven
goals and identified challenges and opportunities in the business model innovation forum.
Beyond giving empowerment, the platform leaders’ role is to inspire others and provide
facilitation and support to develop skills such as story creation and storytelling. Further, they
should control that the initiatives are well aligned with the mission, prioritizing its
accomplishment over other goals, to preserve the integrity of the brand. Such control, in fact,
should be carried out by all stakeholders. Platform leaders should deeply assume that
empowering stakeholders consists also in sharing power with them.

Other key activities apart from the open innovation system would be:
 Destination’s strategic planning, implementation and evaluation is one of the primary
roles of the destination’s platform, from the definition of the mission and the design of the
business model, to its deployment and continuous revamping so long as the environment
requires so. This is the main role of the platform’s executives, with the support of the open
innovation system and the information gathered through the monitoring system.
 The destination marketing is one of the main reasons to justify the development of
business models 3.0, leveraging the outcomes of the content marketing system to develop
campaigns, destination merchandise, organise events and support special projects such as
film broadcasting. Further, especially at the beginning, the platform should develop a
marketing plan to start-up the content marketing system and leverage the marketing
partners’ influence to attract the first flows of visitors.
 The storytelling training is just as important as the aforementioned story creation
section, as it is to train and coach stakeholders in developing their storytelling skills. Such
training has to be carried out by a pool of certified storytelling facilitators who train not
only all platform partners, but also tourists, becoming one of the life-changing experiences
that set destinations 3.0 apart from others. Needless to say, it will be a key factor in
nurturing the content marketing system.
 The local service suppliers training may also be critical, so long as the destination
model 3.0 intends to foster entrepreneurship in the poorer layers of the local communities.
This training and coaching should be primarily focused on hospitality business
management, customer service and foreign languages, without disregarding other needs to
be identified through the service quality control.
Among the management activities, some should be highlighted for their critical importance:
 Service quality control on all service suppliers would be carried out through the reviews
and ratings of customers plus a “mystery tourist” system to complement it and to assess
the needs for training and coaching, especially for the new entrepreneurs. This would be
complemented with an incentive system to stimulate service and skill development
attitude, including penalties for suppliers who do not comply with the quality standards.
 Service booking system for activities and accommodation, which at the same time
serves as the online platform where tourists write their reviews and rate all the services
they have used. Such booking platform should be adapted for smartphones to allow visitors
do their bookings and reviews as they experience the destination.
 Partner selection and integration following the partner development strategy, which
establishes the target partners’ profiles with precise criteria, and the integration formulas
and procedures they may choose in order to become destination partners.
 Partners’ shifting through integration formulas, to accommodate the integrated
partners who wish to change their integration status, upon complying with the specified
regulations. This is explained in detail in the section 3.
 Monitoring the evolution of the destination’s activities through a system of key
performance metrics which are to indicate the need for reorienting efforts or strategy in
case the results do not meet the strategic goals. There should be many KPI sections:
 Indicators tracking the outcomes of the open innovation system, like mission-
driven initiatives, business model innovation discussions, as well as marketing ones like
written stories, shared contents and other social media metrics.

 Indicators tracking the expansion of the business model, like number of innovation
system members (considering various member categories), partners by category, overall
tourism arrivals, overall revenue, revenue per geographical market, revenue per market
segment, average revenue per tourist, average length of stay, merchandising sales,
occupancy rates, satisfaction rates, etc.
 Indicators to characterize the evolution of tourist demand, identifying the behavior
patterns for every market segment, like average expenditure, average length of stay,
type of accommodation, activities carried out, type/size of group, trip organization,
marketing channels, etc. These are also to gain a better understanding of tourists’ needs,
concerns, motivations and aspirations.
 Other indicators tracking the evolution of the business model such as the kinds of
integration formulas to which most partners adhere -indicating the confidence inspired by
the model-, profitability of the business units, number of direct and indirect employments
created, training courses attended and successfully completed by employees and
partners’ employees, etc.
 Indicators tracking the accomplishment of social and environmental goals, further
explained in the section 2.12.
 Scanning the market environment in search for market trends, opportunities and
threats in the outbound markets that may lead to rethink the business model. This should
be done through partners’ collaboration in the open innovation system and ideally through
a nationwide market intelligence system delivering information to all its local destinations.
This is further developed in the Whitepaper Envisioning destination intelligence 3.0.
Further, it is necessary to explain the performance standards the model should comply with,
the key metrics to monitor them, and the key competences needed to comply with them.
1.7 Key resources & organizational structure
There are four types of key resources to be considered in a business model 3.0: physical,
intellectual, human and financial.
 Physical resources are mainly those related to the platform infrastructure, which account
for the land, infrastructures, facilities and business units that are necessary to start
operating and developing the business model. They are the ones that must be acquired or
integrated to the business before attempting to convince new partners to join the platform.
It is necessary to define and dimension the needed facilities, infrastructure and business
units according to different levels of business activity, in order to scale up the destination’s
service capacity as long as the tourism flows increase over time.
 Intellectual resources are mainly the outcomes of the open innovation system:
experiences, stories, marketing contents and designs, and insights and ideas to revamp the
business model over time. In many cases, the destination may already have some valuable
intellectual resources, such as a reputable brand or unique intangible cultural assets
(traditions, stories, gastronomy, or other experiential know how), which should be
leveraged to the utmost of their potential. These are to be generated through
empowerment, facilitation and an incentive system that truly understands and adapts to
the motivations of all stakeholders.

 Financial resources are critical not only for the platform’s investments in facilities, but
also for funding the micro-entrepreneurs in their business ventures. This will require two
different approaches: for the new facilities and infrastructures the business model should
look for investors -see section 3 on selling the vision to shareholders/investors-, whereas
for the micro-entrepreneurs the business model should look for financial institutions
providing micro-loans. Alternatively, the platform could obtain the funds through investors
or “macro-loans” and provide the micro-entrepreneurs with subsidized loans out of these
funds. A financial analysis of the model should estimate all the needs for funding, as well
as the expected profitability to convince investors.
 Human resources are all those who contribute in the generation of intellectual resources,
those who participate in the integrated businesses of the platform, and the team of
executives who lead and manage the platform. As mentioned in relation to the performance
standards, it is critical to identify the key competences the platform needs to develop the
business model to the utmost of its potential. Such competences should be described not
only for the organizational structure of the platform’s executive team, but also for
establishing the partner’s selection criteria and for determining the key talent to be
attracted to the open innovation system.
The platform’s organizational structure should rather have a horizontal profile to empower
leadership development within the team, but also to foster a culture throughout the
stakeholder ecosystem based upon empowerment, trust, collaboration and innovation.
Even if the organizational structure may differ among destination models 3.0, there are some
roles and competences which are likely to be necessary in all of them:
 Managing director: in charge of leading the executive team, the corporate strategy
direction, and platform’s public relationships. He or she would be the leader of the business
model innovation area of the open innovation system. This would correspond to a visionary
with strong leadership skills and great capacity for understanding all stakeholders’ needs,
motivations and concerns, in order to lead the business model innovation with the smoothest
possible manner.
 Experience development director: in charge of leading the “experience development”
section of the innovation system, bringing in ideas to inspire the development of new
experiences, organising creativity challenges and events, coaching partners in their
experience development efforts, and controlling that all experiences comply with the mission
guidelines. This would be a professional with strong leadership skills, imagination and
coaching skills.
 Business intelligence director: in charge of collecting, analysing and communicating the
intelligence data following the key performance metrics’ parameters, as well as the market
intelligence. This would be an analyst profile with good leadership skills to establish
relationship with all kinds of stakeholders who ultimately provide the intelligence data to
nurture the monitoring system.
 Operations director: in charge of leading the operations manager team -Partner integration
& HR manager, Quality manager, IT manager and Maintenance manager-. This would
correspond to a professional with strong leadership skills, conflict resolution skills, capable of
coordinating a complex operational system in constant evolution, where it is necessary to
attend and understand multiple sensitivities and concerns to properly address all operational
challenges.

 Quality manager: in charge of controlling and assessing the service quality of all partner
suppliers through customer reviews and mystery tourist system, training and coaching on
service quality standards, and determining the rewards and penalties applicable to all service
employees and partners. This would be a professional with strong capacity for coaching and
training, as well as for developing the methodology to assess the service quality performance
and the incentive system.
 Partner integration & HR manager: in charge of assessing candidate partners prior to
their integration into the platform. As a recruiter, should be able to assess candidates’
competences and fit potential into the model culture, determining also the skill development
program to be followed if necessary. This would rather correspond to a human resources
psychologist profile with strong skills in analysing candidates’ competences and mindset.
 Marketing director: in charge of designing and executing the marketing strategy. He or she
would supervise the content and social media marketing, and be in charge of directing the
other marketing activities. This would correspond to a marketing professional with strong
leadership skills, broad marketing vision and imagination.
 Content Marketing Manager: in charge of managing the content marketing activities and
cooperating with the Marketing Director with the design of the content marketing strategy.
This would correspond to a marketing professional specialized in content management, with
excellent criteria for identifying good contents to be used for marketing purposes and strong
managing skills.
 Social Media Manager: in charge of social media marketing campaigns and controlling
online reputation of the destination’s brand. This would correspond to a marketing
professional enthusiast about social media marketing, with imagination and strategic
orientation to leverage the marketing content creation to the utmost of its potential
throughout the social media networks.
Other positions such as the Financial Controller, Booking & Customer Service Manager, IT
Manager or Maintenance manager do not entail specific roles other than usual.
This section should list all kinds of resources to start-up the business, as well as foresee the
new resources to be acquired or attracted as long as the platform is expanded. This should
also encompass the organizational chart with the job description of all executives.
1.8 Key partnerships
As collaborative models, business models 3.0 are based upon leveraging the potential of an
extensive partner network, where we may find several kinds of profiles:
 Service suppliers are mainly the local micro-entrepreneurs that are to become the
backbone of the destination model, providing accommodation, food & beverage and activities.
They are the main experience providers, and the ones who bring along hospitality and
authenticity to the destination. Here, the destination model intends to foster
entrepreneurship in the base of the pyramid to alleviate poverty. These are to be the bulk of
the partner network, helping the platform in the development of economies of scale.
However, it would also welcome experienced professionals to gain know-how, and for some
critical activities such as the organization of events.

 Sponsors could be an extra source of revenue, so long as their business activities are also
aligned with the destination model’s mission and vision.
 Tour-operators and travel agents are likely to become key partners especially along the
initial stages of the model development, as explained in the Marketing Channels section.
 Non-profit organizations bring in the know how on addressing the environmental or social
challenges set up in the mission, as well as workforce and funding in some cases. They also
hold a high credibility to act as brand ambassadors.
 Volunteers bring in extra workforce to accomplish the social or environmental missions,
guided by the non-profit organizations partnering with the destination. Furthermore,
volunteering may be also used to assess many potential employees or potential partners,
thus playing a strategic role.
 Government should take a key role in facilitating the development of the destination model,
and if possible as a long-term investor or guarantor. At a minimum, it should guarantee a
harmonized urban landscape by carrying out the necessary investments and adapting the
regulations.
 Opinion leaders such as bloggers, journalists and other influencers will be the first who will
spread the stories to their followers. They are key players in powering the marketing system.
 Community leaders in the role of influencers to engage the rest of the community, and
then to participate in the creation of experiences and stories for the destination.
 Educational institutions may be valuable partners, from the primary school level in the
story creation to the vocational school level in the training for entrepreneurship in the base of
the pyramid. They may also be a source of volunteers and future employees.
 Strategy consultants may be necessary to provide guidance in the management and the
business model innovation.
 Financial institutions may be needed to provide funding for various investments. Further,
they could provide micro-loans to the entrepreneurs in the base of the pyramid.
 Investors may be necessary whenever expensive infrastructures and facilities need to be
built. As explained in section 3, it is critical to sell the destination model vision in order to
attract long-term oriented investors, as well as to create a two-tier shareholding structure
limiting power to the short-term oriented investors.
 Land owners are likely to be critical partners, to be fully integrated as shareholders to the
platform as long as possible, engaging them for the long term. These are among the first
partners that need to be attracted, accounting for one of the key success factors to start-up
the business model development.
 Storytelling trainers are key players in destination models 3.0, for they are to help all
stakeholders in developing their storytelling skills. They could be freelancers or employees, as
they not only should be required to train new partners, but also to offer storytelling
workshops as one of the life-changing experiences offered in the destination.
This section should explain all kinds of partners that the model intends to attract, specifying
which value they bring in and how they are to be rewarded. There should be specified their
kind of expected participation within the open innovation system, considering the possibility of
using the innovation system for inside-out innovation, leveraging the collective intelligence to
their advantage, under previously specified conditions. In the case of the local service
suppliers, there should be specified their rights and obligations they have to comply with to
become platform’s partners.

Section 3 explains how to integrate partners to collaborate within the destination model
considering different profiles and different degrees of integration. This is probably the greatest
challenge in developing destination models 3.0.
1.9 Cost structure
As destination models 3.0 consist of infrastructure platforms, they are rather fixed cost based,
though they have some variable costs as well. As with all overhead based structures, they try
to leverage the platform structure to the utmost of its potential, attracting partners that
ultimately generate economies of scale and also economies of scope.
Destination models 3.0 intend to be value driven platforms, focused in providing value to its
customers and partners, rather than on minimizing costs only. The value provided by the
platform to its integrated businesses is based on training and facilitation to help them provide
an excellent service, inspiration to develop signature experiences, funding and empowerment
to start-up a business, a powerful marketing system to drive more tourist flows, and an
aesthetically harmonized scenario which provides a feeling of authenticity to the visitor.
The main overheads of a destination platform are to be determined by the need for
investments in infrastructures, facilities and urban aesthetic harmonization. These would be:
 Maintenance of the physical platform
 Staff salaries
 Fixed costs related to the integrated business units
 Investments amortization
The main variable costs of a destination platform in most cases would be:
 Marketing expenses
 Rewarding incentives for contributors to the open innovation system
 Training and coaching for employees and service supplier partners (to be internalized once
the model becomes established and there is constant demand for such services)
 Mystery tourist services
 Subsidized capital cost in the micro-loans to the small entrepreneurs
 Mission driven activities powered by volunteers, to be paid for their expenses
In this section, the necessary investments with their corresponding amortization periods
should be estimated, together with the estimation of fixed and variable costs according to
different levels of scale, foreseeing the future development of the destination.
1.10 Revenue streams
In Tourism 3.0, revenue streams are a result of the customer engagement in the mission
accomplishment. Depending on every model, there could be several kinds of revenue streams:
 Sales of merchandising products (through licensing designs to manufacturers)

 Service sales (accommodation, activities, food & beverage) from integrated business units
 License fees to local service providers in some cases
 Brokerage fees for the booking platform service
 Renting fees for renting premises and facilities to local service providers or partners
 Service fees to partners for training or providing technical assistance
 Asset sales (real estate investments)
 Sponsorships
 Service suppliers’ advertising in the online marketing platform (paid advertising space)
To provide services to the local service partners, there could be two main revenue models:
 “Service based fee” model, in which the local partner pays to the platform for the training or
services used, at an advantageous fee, leveraging the negotiation power of the platform.
 “Flat service fee” model, in which the local service partners have to pay a fix fee to the
platform, allowing them to use a portfolio of services without extra charge.
In between these two opposite models, there may be many intermediate ones, in which there
is a fix monthly service fee which gives right to service supplies up to a limit, from which
services are payable. Further, such service fees may be subsidized by the platform -especially
for the micro-entrepreneurs in the poorer layers of the community-, or to be also funded
through the micro-loans. All these issues are to be discussed during the business model design
phase with the local community leaders, as they are closely related to the local culture.
This section should include a diagram depicting the evolution of the revenue streams along
the different stages of development, in contrast with the evolution of costs over these
development stages. This diagram would visually depict whether some customer segments
subsidize other segments, or some business units subsidize others, especially in the early
development stages. The diagram should also include a break-even analysis to show when the
platform is expected to generate profits.
Hereby it is important to remark that one of the main goals of the open innovation system –
within its business model innovation section- is to create new revenue streams, increase the
existing ones, and reduce costs, for this scheme may change over time, if the circumstances
advise to do so.
1.11 Social & environmental costs
Even if destination models 3.0 intend to address social and environmental concerns by
reducing the negative impacts that the tourism activity usually creates, it may not be possible
to eliminate them completely, for it is necessary to foresee and monitor these impacts to
obtain a holistic assessment on the mission accomplishment.
Furthermore, this section should also explain to what extent the destination model manages to
reduce these costs in comparison to most conventional models. So long as the mission is not
only to create positive impacts, but also to reduce negative impacts, it is necessary to gauge
the negative impacts that the model manages to save in the social and environmental spheres.

There should be established a set of goals in relation to this intended impact reduction. For this
purpose, a series of performance metrics are to be designed, along with those for measuring
the positive social and environmental impacts. Once a year, a social and environmental audit
should be carried out to assess the impact reduction in relation to previous years.
1.12 Social & environmental benefits
As already introduced in previous sections, the mission of destination models 3.0 is to address
social and environmental challenges that concern the stakeholders. In this section we explain
the positive impacts that the tourism development intends to make according to its mission.
The two main types of missions are most likely to be poverty alleviation and environmental
sustainability, for which we need to define the role of the destination model in addressing
these challenges, the goals and the metrics to measure its success.
When focusing on poverty alleviation, this is intended to be attained through fostering
entrepreneurship in the base of the pyramid (BOP), favouring local businesses as suppliers,
investing in infrastructure, and providing training, coaching and micro-funding to the poorest
layers of the community, empowering them to become active players within the destination
model. Ultimately, their participation brings along more human capital in the creation of
experiences and stories, as well as a surplus of authenticity and variety that will positively
impact in the visitor’s experience and the image of the destination.
Moreover, the raise of the bottom of the pyramid in terms of disposable income is to create
multiple opportunities for the local economy, with all the new services and products that they
may afford to buy. There may be many indicators to track the evolution of poverty alleviation:
 Newly created tourism businesses in the poorer layers of the community
 Increased disposable income in the poorer layers of the community
 Newly created “non-tourism” businesses serving the poorer layers of the community
 Increased turnover of old businesses serving the poorer layers of the community
 Increased number of households with access to information technology and computer literacy
 Increased access to primary and secondary education in the poorer layers of the community
When focusing on environmental protection and sustainability, in the case of nature-based
tourism destinations, there are many roles that the destination model may take:
 Collaboration with research programs (either by universities, corporations, government, etc.)
or environmental protection programs (private foundations, NGOs, government, etc.) by
lending some of the facilities, programming volunteering activities related with the field work,
etc. In some cases, the open innovation system could serve also as crowdsourcing resource
for innovative ideas. Alternatively, the destination could also serve as a pre-testing field for
new eco-friendly products.
 Creating awareness among stakeholders about the environmental issues and challenges of
the destination, by educating them on the threats and the good practices that should
guarantee the protection of the destination’s environment, in order to create a network of
environmental ambassadors that spread these concerns and good practices.

 Integrating environmental friendly facilities and practices within the main business activity,
thus minimizing the impact on the environment. These facilities and practices could also be
leveraged for educating and creating awareness about the environmental challenges, thus
accomplishing the aforementioned role at the same time.
The indicators to track the environment related mission should be designed by environmental
experts according to the established goals aligned with the mission.
Beyond the aforementioned main benefits, there may be other positive impacts such as those
related to cultural protection and promotion, socio-cultural change and human development on
both the local communities’ side and the visitors’ side. These benefits may be difficult to
measure and are most likely to be assessed through the kinds of stories that are created and
their popularity.
A series of Whitepapers are to be released featuring case studies to illustrate how the
destination model 3.0 approach may be applied in various tourism destinations.
2. Integrating partners to the collaborative model
2.1 Design of value proposition & business model architecture
The first step in the strategy formulation is to define the mission. This should be done by
listening to all the local stakeholders to identify current and future challenges affecting the
local community and the specific constituents of these challenges (disadvantaged persons,
minorities, elderly people, etc.), mostly those in the base of the pyramid. Further, it is
advisable to identify concerns related to the protection of the environment or the cultural
heritage. The local communities are the first ones who have to be engaged with the mission,
and so their opinion and will should play a decisive role on the mission definition.
The next stage entails searching for solutions that can be powered through the tourism
activities, which involves finding ways to transform the tourists’ lives to satisfy social needs
and motivations which may also be understood as another mission focused on the socio-
cultural transformation. Participation of communities of creative people should be encouraged
from this stage. This process starts in the strategy formulation phase, but continues
permanently as the main goal of the open innovation system where all stakeholders are
empowered to participate.
Then, another key step in the strategy formulation is to identify the key partners and key
resources the destination needs to start the virtuous circle that leads to expand the model.
They are the ones that make the destination and the business attractive enough to
progressively attract and engage new partners and a growing network of customers who turn
into brand ambassadors. The usual core stakeholders to engage in the first phase are to be:
 Local government, providing infrastructure, long-term shareholding and institutional support
 Investors, so long as there need to be carried out significant investments in tourism
infrastructure
 Owners & operators of existing key tourism infrastructures
 Land owners of the areas where the new tourism infrastructures should be built

 Operators for the new key tourism infrastructures
 Community leaders, who should influence and engage the local community
 Channel partners such as Tour-operators and Travel Agents with key market influence
 Opinion leaders such as journalists and bloggers to spread the first stories to their followers
Furthermore, it is necessary to define the partners’ profile for all resources and activities that
are to be outsourced, establishing the prioritization criteria for the selection process and
negotiation key points.
Moreover, the development of the destination model needs to define a strategy which sets the
priorities on the requirements partners should comply with in relation to the value brought and
mission commitment. In this regard, we will probably not always find the necessary service
suppliers sharing our mission and values –especially at the beginning-, and so we will need to
understand their values and expectations in order to build win-win collaboration. Progressively,
as the model scales up, the strategy prioritizes partners who share our mission and vision,
eventually replacing those who do not.
2.2 Design of integration formulas
When attempting to integrate the local service providers into the platform, we are likely to find
different attitudes with regards to their confidence on the project and their will for keeping the
control of their business. Further, this attitude may change over time, for it is necessary not
only to offer different integration formulas attending different risk attitudes or want for
autonomy and ownership, but also to offer a flexible system that allows them to shift from one
to another integration status.
For instance, the range of integration formulas could go from the full integration exchanging
the business ownership for platform shares, to the lowest possible integration status in which
the business is associated to the platform only by having to comply with certain service quality
standards to take advantage of the aforementioned benefits of the platform. In between these
formulas, there could be intermediate formulas guaranteeing a minimum profitability, but also
with a limited dividend, to accommodate those with a medium level of risk aversion. As
showed in the following table, in many cases we should distinguish between the integration of
businesses and properties.
Owner’s
risk
perception
Properties (premises, facilities,
land, etc.)
Businesses
High risk Renting or selling to the platform Association in low integration status
Medium
risk
Integration with guaranteed
profitability
Integration with guaranteed
profitability
Low risk Full integration at all risk Full integration at all risk

Detailed information about the implications of each option would be provided to partner
candidates, to help them visualize the pros and cons of every option. In general, these could
be the following:
Advantages Disadvantages & Obligations
Low
integration
 Keep ownership of the business
 Profiting from platform’s marketing
 Advantageous deals in key supplies
 No influence on platform’s policies
 Compliance with service standards
Mid
integration
 Guaranteed shares’ profitability
 Right to vote on platform’s policies
 Preferential marketing deal
 Free or subsidized training &
assistance
 Limited shares’ profitability
 Limited voting power
 Lose business ownership & control
 Fix salary + bonus, subject to
penalties when failing to comply
with rules
Full
integration
 Stake in platform’s profits to the
fullest
 Full right to vote on platform’s
policies
 Preferential marketing deal
 Free or subsidized training &
assistance
 Loose business ownership &
control
 Fix salary + bonus, subject to
penalties when failing to comply
with rules
 Risk of no profits in case of
platform’s poor results
Hereby it is necessary to remark that partners associated to the platform –in low integration
status- would be also encouraged to invest in the platform to take advantage of its profits and
have the right to vote when deciding the platform’s policies.
Besides, there should be a specific integration and development strategy for the new
entrepreneurs encouraged through the platform development policy, establishing many
integration options and setting their path to regain full ownership of their business in case they
eventually wish to do so. For instance, as it happens with new employees, many new partners
–especially the micro-entrepreneurs in the poorer layers of the community- should follow a
trial period during which they are trained, coached and closely monitored to assess their
suitability as integrated service suppliers.
All in all, the design of the integration strategy requires making the local service suppliers
envision the future of the destination through the development of this model, and listening to
understand the different levels of risk attitude and enthusiasm that the project inspires,
identifying their fears and concerns about the integration process. This should be done through
the Partner Discovery process, encompassing three main steps:
1) Mobilizing community leaders. The first step is to create awareness about the need for
a new destination model, presenting a consistent proposal as a starting point, and
establishing a common language to discuss about the new model. Community leaders are
the first to participate in the discussion, though in the following phases other community
members should also be consulted.

2) Understanding. Upon presentation of the first proposal, the second step consists on
getting feedback and understanding of the locals’ concerns, problems, needs, fears, and
aspirations that the model has to address. Hereby we may identify different partner
profiles, with different concerns and aspirations, which set the direction to refine the
integration formulas to accommodate all profiles.
3) Designing. Based upon the feedback and insights obtained from community leaders, the
initial prototype(s) should be rethought to adapt to the previously unknown requirements.
Both “design” and “understand” are parallel processes interacting constantly along many
rounds to revamp and pre-test the model, its formulas and the valuation criteria to
integrate businesses into the platform.
The development strategy for integrating partners should consider several development phases
stating the milestones when priorities change. For instance, the second phase should not start
until the platform is able to operate providing all services for a minimum flow of visitors. This
may entail also a spatial development strategy in which the model scales up when a
determined area is fully or almost fully integrated into the destination model.
2.3 Selling the vision to community stakeholders
The challenge of integrating all the community of stakeholders requires its own marketing
plan, usually known as internal marketing plan. This plan should encompass the target
stakeholders to attract in every phase, the integration formulas, and the communication
strategies and actions to achieve these goals. Since the beginning when presenting the first
model prototypes to pre-test and design the integration formulas and when eventually
marketing the destination model to engage the community stakeholders, it will be necessary to
explain them the model vision in a compelling way that connects first with their emotions and
human spirit, and ultimately opening their want for a deeper understanding of the destination
model rationale.
Stories are the best way to help people imagine how the new model is likely to improve their
current status quo, how it creates value and therefore improves the community’s life quality.
Stories convey the new model ideas to the people’s minds describing them in a way that
overcomes resistance, the most likely reaction to new model propositions challenging the
status quo. By capturing people’s attention and curiosity, compelling stories are to pave the
way for an in-depth presentation and further discussion about the new destination model, to
eventually make the potential stakeholders understand the implications that the new model
would have for them: costs, obligations, efforts, and benefits for the individuals and the
destination as a whole.
To better convey the idea about how the new model would operate for the local stakeholders,
it is convenient to use one main character similar to the audience profiles (service suppliers) to
be the protagonist. Such character should have similar problems, needs, concerns, fears and
aspirations as most local potential stakeholders, so to make them feel identified with him and
connect with the story. Then, the story shows the character finding out how the new model
addresses all these needs and concerns, so to help the audience visualize the answers to their
questions and fully understand the operation of the model.

Furthermore, it is convenient to provide potential stakeholders with an interactive tool where
to “play” with the model simulating how it would be to become an integrated partner within
the new platform. So long as the model system is complex, such tool is crucial to help
potential partners understand and envision their possible fit. This should be complemented
with workshops where platform representatives attend community stakeholders’ queries.
Such destination’s vision is not only necessary to convince the community members to
integrate, but also a guiding force that constantly aligns everyone’s efforts on their
contribution to expand the destination model to the utmost of its potential and to accomplish
the mission. In this stage, when defining the model to be deployed throughout the destination,
one of the key points is to decide upon harmonizing the urban aesthetics style for the whole
destination. This should be quite flexible and should be voted by locals.
2.4 Selling the vision to investors
In many cases the tourism development will require not only to integrate businesses, land and
facilities’ owners, but also to invest in developing new infrastructure or renovating heritage and
urban aesthetics, for it may be necessary to attract investors beyond the local players. In this
regard, the local government should play a decisive role in supporting the development of the
destination model, at least in the early stages and until the model is consolidated and
profitable. Such support could consist on assuming many investments and integrating within
the platform as a stable shareholder, or taking the role of platform’s guarantor to external
shareholders and financial institutions.
As destination models 3.0 are mission driven models whose value is ultimately derived from
the impact they make on the society and its environment, they require investors who share
the same vision and so agree upon prioritizing the long-term profits over the short-term.
Shareholders have to assume that the success of their investment will only come as a result of
being faithful to the values and the mission, to obtain the engagement of all stakeholders.
Fortunately, there is already a growing concern among investors about sustainability,
considering the long-term policies that guarantee the preservation of the environment and
social cohesion as key sources of competitive advantage.
Needless to say that many investors are not likely to share this vision or be willing to support
the project over a long period of time, for which it would be convenient to create a two-tier
shareholding structure whereby long-term shareholders would be given more power than the
short-term oriented ones when deciding the corporate strategic direction, to help the long-
term oriented votes clearly outweigh the short-term oriented ones.
However, investors want to assess the long-term benefits of sustainability through metrics that
quantify them financially. In “Marketing 3.0”, Philip Kotler suggests three metrics:
 Improved cost productivity is mainly attained through the lower marketing costs of the
experience and story generation & distribution system through the social networks, compared
to conventional product development and marketing campaigns. Further, mission driven
businesses obtain higher engagement from their employees and partners, which ultimately
boost their productivity.

 Higher revenue from new market opportunities, due to the higher market penetration
that mission driven businesses tend to achieve, as they touch not only people’s minds and
hearts, but also their human spirit. Further, the government is also more likely to support
businesses that intend to address some of the local challenges and improve people’s lives.
 Higher corporate brand value is the long-term result of sticking to the brand values,
pursuing the mission and generating compelling stories which are extensively distributed.
To foster long-term focused shareholding, the destination model should encourage all
stakeholders to become shareholders, especially those located in the destination’s community.
As mentioned before, the government should also play a key role, at least in the early stages
of development, as a key support benefiting the long-term welfare of the community.
3. Strategies for a sustainable development
Once designed the architecture of the model, it’s time to design the strategies to develop it to
the utmost of its potential. The development strategies are likely to be quite different
depending on the initial scenario, whether it is a resort, a decentralized destination or a group
of resources to be exploited for the tourism business. Hereby are described the four key
development strategies that are to determine the success of the destination model 3.0.
3.1 Human resources development
One of the key factors that makes destination models 3.0 deliver a superior value proposition
to other destinations is the better human development of its service suppliers, along with the
service quality control and incentive system. The human resources development strategy
intends to unlock and leverage all the human potential of destination stakeholders, by
stimulating their creativity and empowering them to develop and bring in all their talents in
benefit of the destination, giving them incentives and recognition for their contributions. There
could be many kinds of training programs:
 Empowering locals to become micro-entrepreneurs, coaching them to develop their business.
 Training employees and service suppliers on delivering a memorable customer experience.
 Language training in the main languages of the target outbound markets.
 “Storytelling training” for all local stakeholders on how to create and tell stories, developing
their communication skills, and eventually giving them the chance of participating in
rewarding contests and publishing their stories.
 Training to develop artistic skills such as photography or graphic design, which could be used
to generate marketing contents.
 Educating on business model innovation in order to both help entrepreneurs reinvent their
own business and to participate in the open innovation system discussions about revamping
the destination platform business model.
Some of these programs like the storytelling training and artistic skills development, should be
also offered as life-changing experiences to the tourists, who eventually may generate ideas
and contents for the destination.

3.2 Open Innovation system development
Being one of the key assets to invigorate creativity and sustain the destination model
competitive advantage, it is necessary to design a set of strategies to engage stakeholders in
contributing up to leveraging the most of the collective intelligence. The open innovation
platform is to unlock the creativity of all stakeholders, starting by its employees, followed by
its closer partners, and beyond.
One of the key factors to make the open innovation work is to constantly connect with external
networks, which are more likely to bring in new ideas than creativity alone. Based on the same
principle, encouraging the network members to travel, research and learn about other
destinations should nurture the innovation ecosystem with inspiring ideas.
Most productive innovation networks are characterized by a decentralized structure with many
leaders who have collaborative mindsets. Such decentralization not only unlocks initiative and
creativity, but also fosters further interaction and collaboration among the network members.
When developing the open innovation system there are four critical steps to follow from the
design phase, to the execution and management of the network:
1) Connecting and organising people:
 Find open minded people who are motivated for innovation
 Combine people with different approaches to innovation (idea generators, experts, producers)
 Make sure there are members with different profile in terms of skills, seniority and field of
expertise
 Include subgroups devoted to specific tasks and goals
2) Setting goals and engaging members:
 Define the role of the innovation network and groups in relation to the organization’s mission
 Establish innovation goals and metrics to track progress
 Plan how to establish trust among network members and engage them quickly
3) Supporting and facilitating:
 Determine technology support required for network members
 Define additional support if necessary
 Define key information inputs
4) Managing and tracking:
 Define incentive system to reward contributions
 Determine accountabilities and timing to track and assess performance
 Decide who takes new responsibilities and who leaves responsibilities
When composing innovation teams, some rules should be applied. For instance, there should
be a balance between four kinds of contributors:
 Idea generators, who come up with out-of-the-box approaches and questions to start with
 Researchers, who bring along an analytical perspective based upon market insights
 Experts, who bring deep knowledge in their field of expertise
 Producers, who coordinate the activities of the network and connect with people from outside

Furthermore, mixing people from different backgrounds -in terms of education, culture, and
industry expertise- is likely to bring along different approaches when trying to solve
complicated challenges.
To start operating the open innovation platform, there are many steps to be followed:
 Guarantee internet access to all internal stakeholders (partners and employees)
 Train stakeholders on how to use the tools.
 Set up content creation contests for experiences, stories and marketing materials; setting
clear rules to make sure they are aligned with the values and the mission. Everybody should
be empowered to start their own story or to collaborate with others’.
 Storytelling training: stakeholders would attend training workshops on how to write stories.
 Training on business model innovation methods to set a common language for discussion.
 Presenting a story and other marketing contents as successful cases to inspire participation.
3.3 Transitioning to content based marketing
As it takes a certain time for the open innovation system to become a productive content
marketing machine, it is necessary to use other marketing strategies along the early stages of
the destination model development. These would mainly consist on the following:
 Partnering with Special Interest tour-operators and travel agents connected to a network of
values driven travellers, to become our first brand ambassadors.
 Invite popular bloggers and journalists to write about the destination’s experiences and
stories.
 Advertising in target related media, co-branding with our channel partners.
In parallel with these marketing strategies, it is necessary to start spotting existing stories to
be used for marketing purposes. As many stories are already in the minds of the locals or even
written, there has to be carried out some research to identify them. Further, the storytelling
training is expected to empower and motivate locals to tell their stories and create new ones.
So long as the storytelling training and the content creation contests generate an increasing
amount of marketable content, and this manage to create awareness about the destination’s
brand and its life-changing experiences, the platform could start reducing the budget for the
aforementioned marketing programs, eventually concentrating all the marketing efforts on the
“content marketing system”.
Such transition requires accurate monitoring of the social media impact of the stories in
contrast with the impact of the other marketing programs. Based upon the results of such
tracking, the platform’s marketing executives should decide whether to accelerate or not the
transition towards the storytelling system. For such purpose, the marketing plan should have a
series of key performance marketing metrics to help the executives visualize the impact of
every marketing program.
Therefore, the marketing plan has to be flexible, with marketing goals determining the turning
points when to shift the budget allocation from conventional to storytelling marketing.

3.4 Service dimensioning
Once identified the portfolio of partners, infrastructures, facilities and service suppliers needed
to start operating the platform, it is necessary to envision the necessary service capacity or
carrying capacity for each of them throughout the subsequent development stages. This entails
determining the necessary capacity for every business and facility in each of the destination
areas in a reference day, foreseeing the expansion of the model to the utmost of its potential.
There should be dimensioned the service capacity of facilities, infrastructures and service
businesses, and for the entire portfolio of experience providers, to guarantee a balance in the
variety of experiences offered throughout the destination, in accordance with demand.
The service dimensioning plan serves as a layout for the expansion of the model, setting the
direction on which services and facilities have to be developed in which location, ensuring a
balanced and harmonious development in every stage of the model’s expansion.
4. Comparative performance between different destination models
To better realize how destination models 3.0 outperform other models in creating value,
reducing efforts and marketing efficiently, hereby are compared three destination models:
Cultural destinations: based on cultural or natural resources with several business owners
operating independently. This is the case of most destinations all over the world. There may be
found many cases of cooperation, either between a group or even the majority of the private
operators, or also including the government. Most of the cooperation is developed for
marketing the destination, though there are other cases like where the object of cooperation is
monitoring the tourism industry activity and gaining a better understanding of the tourist
flows, like in the case of the Tourism Observatories.
Resort destinations: based usually on natural resources with one owner operating or
controlling all business units providing service in the destination, being also responsible for the
marketing. All business units are therefore integrated within the resort. This is the case of
many ski resorts, beach resorts and theme parks. There are also mixed models, with a resort
owning many businesses so to offer integrated packages, but other independent businesses
are also present in the destination thus taking advantage of the demand generated by the
unique assets of the resort, as it is the case of most ski resorts and theme parks. In these
cases, the government may also support in marketing the destination.
Destinations 3.0: based on either cultural or natural resources with business units belonging
to many owners, and operators cooperating with different levels of integration on the
management and marketing of the destination. Envisioning Tourism 3.0 is to release
Whitepapers depicting examples of Destination models 3.0 applied to different types of
destinations, with detailed explanation of all the aforementioned building blocks, to help the
readers visualize the experience and the operation of Destinations 3.0

KEY DIFFERENCES BETWEEN THE THREE DESTINATION MODELS
CULTURAL
DESTINATIONS
RESORT
DESTINATIONS
DESTINATIONS 3.0
VALUE PROVIDED
Experiences Typically local
cultural experiences
Based upon cultural
& natural resources,
and locals creativity
Standardized
experiences
Based on standard
products, natural and
artificial resources
Life-changing,
tailored and creative
experiences
Based on co-creation
by stakeholders
Feelings Cultural character
and authenticity with
heritage protection
and hospitality
programs
Lack of character and
authenticity
(replicated facility
style)
Enhanced
authenticity through
urban aesthetic
harmony and locals’
inclusiveness as
experience suppliers
Service quality
control
Some service
suppliers have
Quality certifications
Ratings for
restaurants and
accommodations
Comprehensive
service quality control
Ratings for
accommodation
Comprehensive and
incentivized service
quality control
EFFORTS REQUIRED
Discomforts Dependent upon
every service
supplier and local
service standards
Fully specified
comfort standards,
adapted to the needs
of tourists
Only discomforts
associated to cultural
environment
Insecurities &
risks
Dependent upon
government
regulations and
control
Full information and
safety controls on
critical issues
Full information.
Safety based upon
public regulations
MARKETING
Needs satisfied Functional and
emotional
Mostly functional, but
also emotional
Functional, emotional
and spiritual
Target tourists All kinds of tourists Limited segments All kinds of tourists,
but mainly tourists 3.0
Marketing
guidelines
Differentiation Differentiation or
price
Mission, vision &
values

About Envisioning Tourism 3.0 Ltd.
Envisioning Tourism 3.0 Ltd. is a consulting firm building thought leadership in
strategy innovation for tourism destinations, designing innovative business
models, intelligence and marketing systems to envision how tourism
destinations may embrace the trends labelled under “The vision of tourism
3.0”, encompassing collaborative models, open innovation, human spirit
marketing, product co-creation, storytelling and culture shift towards
innovation and collaboration, among others.
Tourist
relationships
Sales transactions
and satisfaction
monitoring
Sales transactions
and satisfaction
monitoring
Experience co-
creation, storytelling
through communities
Marketing
channels
TTOO, TTAA and
direct sales
TTOO, TTAA and
direct sales
Mission driven agents,
communities
COMMUNITY
IMPACT
Economic prosperity
concentrated in
business owners
Economic prosperity
concentrated in the
resort owners
Poverty alleviation,
socio-cultural change,
environment care
MAIN
CHALLENGES
Harmonize
experience system
and quality standards
Develop unique
experiences based
upon authenticity
Integrate and
associate stakeholders
Foster culture change
Envisioning Tourism 3.0 Ltd. is to keep on designing new destination model prototypes
approaching the Vision of Tourism 3.0 with different levels of complexity.
Envisioning Tourism 3.0 Ltd. invites all readers to share their opinions on the exposed visions
and methods in the blog www.envisioningtourism.com. Readers’ reviews and contributions are
very appreciated, as they help us to improve the quality of our contents as well as extending
the explanation of our visions whenever necessary. You are welcomed to participate in
depicting how Tourism 3.0 may shape the future destination models, marketing and
development strategies.
References
 Philip Kotler, Hermawan Kartajaya and Iwan Setiawan.“Marketing 3.0”.Wiley, 2010.
 Alexander Osterwalder, Yves Pigneur. Business Model Generation. Wiley, 2010.
 Joanna Barsh, Marla M. Capozzi, Jonathan Davidson. Leadership and innovation. McKinsey &
Company, 2008.
© 2013 Envisioning tourism 3.0 Ltd. All rights reserved

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