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Impact of Sustainability Initiatives on Customer Choice by Kumud Sengupta, SOST

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What impact do sustainable business practices by travel companies have on travellers’ choice of a travel service provider (hotel, resort, tour operator etc.)? A survey was commissioned by Market Vision in mid-2013, aimed to determine the extent to which demonstration and promotion of sustainability initiatives by travel companies can impact customer choice behaviour. The results suggest that, all else being equal, a certain proportion of travellers would be inclined to patronize a travel company whose sustainability credentials are easily visible while a larger proportion would be inclined to go with a travel company whose sustainability credentials are easily visible and are endorsed by a credible third party assessor. A smaller proportion of travellers would not care. What should eco-tourism businesses do to attract such customers and influence their choice?

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Impact of Sustainability Initiatives on Customer Choice by Kumud Sengupta, SOST

  1. 1. Impact Of Sustainability Initiatives On Customer Choice Kumud Sengupta Director – Market Vision Managing Editor – SOST ITB Asia, Singapore, October 24, 2013
  2. 2. Impact Of Sustainability Initiatives On Customer Choice
  3. 3. How Do You Define Sustainability in the Context of Tourism?
  4. 4. Sustainable tourism: Tourism that takes full account of its current and future economic, social and environmental impacts, addressing the needs of visitors, the industry, the environment and host communities. UNWTO definition
  5. 5. The Triple Bottom Line Approach * Environmental impacts * Socio-cultural impacts * Economic impacts
  6. 6. Sustainable Tourism Makes Business $ense
  7. 7. 1. Worldwide tourism growth 2. Business benefits 3. Rising consumer demand
  8. 8. 1. Worldwide tourism growth International tourist arrivals, millions 2000 1600 1200 800 400 0 1980 1990 1995 Source: UN World Tourism Organization 2000 2005 2010 2020 2030
  9. 9. 2. Business benefits Cost savings Improved profitability Competitive advantage Improved brand image Customer loyalty Employee loyalty Product diversification
  10. 10. 3. Rising consumer demand
  11. 11. Governments and businesses are also demanding a green travel supply chain
  12. 12. What impact do sustainable business practices have on travellers’ choice of a travel service provider?
  13. 13. A survey was commissioned by Market Vision in mid-2013, aimed to determine the extent to which demonstration and promotion of sustainability initiatives by travel companies can impact customer choice behaviour.
  14. 14. This?
  15. 15. Or This?
  16. 16. This?
  17. 17. Or This?
  18. 18. Choice of travel company 18% 35% Sustainability initiatives visible Sustainability initiatives visible + endorsed Makes no difference 47%
  19. 19. And that is despite lack of sufficient awareness and recognition of individual certification brands
  20. 20. So… What should eco-tourism businesses do to attract customers and influence their choice?
  21. 21. 1. Tell your sustainability story Upfront Verbally. Visually.
  22. 22. 2. Get it endorsed Third party certification Assurance of authenticity, quality standards
  23. 23. Choose the most appropriate certification program It is a JUNGLE out there!
  24. 24. Bear in mind… …Consumers purchase first based on price, quality, and safety. Hence, the certification label must fulfill these needs, as well as ensure environmental and social responsibility.
  25. 25. 3. Be prepared to promote it Use the marketable logo as a differentiator (many businesses don’t) Be prepared to promote the program that certifies you
  26. 26. Get started… Link quality of product, sustainability and consumer experience Integrate into conventional marketing channels
  27. 27. Spotlight on Sustainable Tourism (SOST) – e-journal promoting best practices in sustainable tourism www.sostinternational.com
  28. 28. Thank you. Kumud Sengupta kumud@market-vision.com Skype: kumud.s Twitter: Kumudsengupta www.sostinternational.com Market Vision Research & Consulting Services P.O. Box 32394, Dubai, UAE Tel: +9714 3911241; Fax: +9714 3911245 Web: www.market-vision.com

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