Unit – 3 product or service that people are willing and able to buy at each

specific price in a set of possible prices during some specified period of

Tourism Demand and Supply time.

Individuals called tourists generate tourism demands. This

3.1 Introduction to Tourism Demand happens in a particular place called a tourism destination. The scale and
the magnitude of demand differ with time and sometimes with seasons.
Tourism demand is usually regarded as a measure of visitor’s Time demand for tourism services either advances or changes. Such
use of a good or service. The concept tourism demand originated from changes could be due to the emergence of the so-called new tourists
the classical definition of demand in economics, namely the desire to (poon,1994& 1993) these tourists want to experience something new
possess a commodity or to make use of a service combined with the and expect high quality service and value for their money new tourists
ability to purchase it. Tourism demand is a special form of demand in bring with them a different level of demand. Another important issue
that a tourism product is a bundle of complementary good and services. that has arisen is the increasing significance of tourist seasonality with
Consumers instead of goods and services are transported and tourism regard to periods of high and low tourism demand referred to as peak
consumption occurs simultaneously with tourism production. and low seasons respectively.
In order to satisfy the market demand a nation region or Tourism demand has special characteristics particular namely
community must be able to provide a variety of development and
1. Demand is very elastic.
services the supply side. How well this supply side matches the market
2. Demand is sensitive.
is key to ultimate in correct tourism development. The first is labeled as
3. Depending on the time.
tourism demand (representing the tourists) and the second is described
4. Influenced by season
as tourism supply and includes elements such as natural resources
5. Demand focused on specific place.
cultural attractions and historical monuments.
6. Demand depends on the size of income.
Tourism demand is a broad term that covers the factors The factors that influence tourism demand:
governing the level of demand the spatial characteristics of demand
1. Revenue.
different types of demand and the motives for making such demands.
2. Price.
Cooper (200:76) defines demand as "a schedule of the amount of any
 3. Quality. may take place over several years. For example, the benefit derived
4. Political relations between countries. from a car or television is enjoyed consumed over several years. In
5. Economic relations between countries. practice it is hard to measure consumption and the term is used loosely
6. Socio-cultural relations between countries. to men expenditure. Thus consumer expenditure, personal expenditure
7. Changes is weather of climate and private consumption are all the same things.
8. Factors holidays.
1. Economic Determinants
9. Government regulations.
a. Cost of Living (CPI): A cost of living index is a theoretical
10. Restrictions on the use of salt currency (foreign exchange price index that measures relative cost of living over time or
restriction) regions. The amount of money needed to sustain a certain level
11. Transportation technology. of living including basic expenses such as housing. Food taxes,
and healthcare, cost of living is often used when comparing how
Tourism demand can also be understood as the expenditure
expensive it is to live in one city versus another.
made by on or behalf of the visitor before during or after the trip and
b. Tourism Price: to be successful in the marketplace a tourism
which expenditure is related to the trip and which trip is undertaken
product must be priced accurately and competitively. This
outside the usual environment of the visitor.
requires a clear understanding of the individual costs of all
3.2 Determinants of Tourism Demand product components and their impact on total product price.

Tourism visits can take place for various reason: holidays, c. Transportation Cost: the expenses a company incurs when it
business trips, visits to friends and relatives (VFR), conferences, transfers its inventory or other assets to another location. For
pilgrimages and so on. Most empirical studies of tourism demand example, accompany must pay a trucking or shipping company.
examine either total tourists trips including all the above mentioned If a company is delivering a product, it may pass on the costs to
purpose or just holidays trips (write and write 1995). Since the majority the customer. Alternatively, if may spread its transportation
of tourist visits take place for holiday purpose, the determinants of across all products or it may simply absorb the costs.
demand are generally taken to be the same as those for holiday trips in d. Cost of Living in Relation to Destinations: cost of living for
those published studies which examine total trips. Goods which a tourists in the destination.
transfer of ownership rather than new production strictly speaking
e. Exchange Rate Differential: this is the price differential
expenditure takes place when goods are purchased while consumption
between the host country and the tourists country of origin. A
 devaluation of country's currency makes inbound international
tourism less expensive and consequently, increased tourist flows 2. Socio – Psychological Determinants
to that country should result. Conversely an increase in the value a. Demographic Factors: Demography includes factors such as
of a country's currency will make international tourism more population growth declining fertility rates increased longevity
expensive and cause a reduction in inbound tourist flows. and immigration and labor migration etc. These factors have
f. Relative Prices among Competing Destinations: A relative significant influence upon tourism.
price is the price of a commodity such as a good or services in b. Motivations: The primary drivers for travelling are needs to
terms of another i.e. the ratio of two prices. A relative price may escape from dally routine workplace but also social needs such
be expressed in terms of a ratio between any two prices or the as meeting other people experiencing something unique or
ratio between the price of one particular good and a weighted unusual.
average of all other goods available in the market. This concept c. Travel Preferences: The tourism industry has a dramatic impact
applies in terms of tourism also. on the world's economy and development. For this reason it is
important to study vacation traveler behavior including where
g. Promotional Expenditures: Promotional material events or
individuals travel on vacation and what travel mode they use to
ideas are designed to increase the sales of a product or service.
get there.
Similarly tourism to occur requires promotional activities
d. Benefits Sought: The needs and benefits sought by tourism
promotional expenditure is a cost that a business incurs to make
consumers are intrinsically linked to the motivation to engage in
its products or services better known to consumers usually in the
tourism. For example relaxation may be the need motivating
form of giveaways.
many leisure tourists but the products they require to achieve
h. Marketing Effectiveness: Marketing effectiveness can be this may vary some might require indulgence and hedonism
defined as the quality of how marketers go to market with the while other may require a physical cultural or intellectual
goal of optimizing their spending to achieve good results for challenge some may want higher standards of comfort than their
both the short term and long-term. usual environment provides while others may be happy with
i. Physical Distance: distance is basic to accessibility. This means more basic facilities.
that an understanding of space and time is central to e. Images of Destination: Each destination has an image and some
understanding tourism mobility. When we are consuming space can have a stronger image than others. In order to develop a
we are consuming time and vice versa.
 competitive position it is important to crate and transmit a travel distances for the same travel time, then the range of choice
favorable image to potential tourists in target markets. for individuals and firms increases.
f. Perception of Destination: To understand tourists differences l. Paid Vacations: Pad vacation days are days for which an
in perceptions images and motivations toward a destinations is employee is paid when he or she takes time off from work. Most
essential to comprehend and predict tourism demand and it organizations voluntarily provide paid time off to employees as a
impact on the tourism location. benefit. The number of paid vacation days is generally accrued
g. Awareness of Opportunities: Public's understanding of the by employees based on years of service to the organization and
importance of tourism to the local economy is important to the level of their position. Vacation pay is a percentage of an
tourism to flourish. Similarly tourists should also know the employee’s gross earnings from the previous year of
various opportunities available in the destination. employment.
h. Cognitive Distance: An appreciation o distance is important in m. Past Experience: Gaining the loyalty of visitors is one of the
all studies of travel behavior. However the impressions of main challenges of destinations. Satisfactory past experience in
distance that travelers hold in tourist minds are often very destination ensures repeat visit and good word of mouth from
different from real distance. tourists.
i. Attitudes About Destinations: Destination images are n. Life Span: Life span relates to tourism area life cycle (TALC)
interpreted on the receiving end of the communication channel which states that most tourist resorts start on a very small scale
by potential tourists influencing their tourism related attitudes and get bigger and bigger until stagnation occurs. TACL has six
and affecting behavior. stages namely(1) exploration(2) involvement (3) development(4)
j. Amount of the Leisure Time: Leisure time refers to the part of consolidation(5) stagnation and (6) decline. To stop it from
an individual's time that is not committed to work caring or any decline rejuvenation is required. These six stages are modeled in
other responsibilities and can be spent as the individual chooses. two dimensions as product life cycle namely on x axis it is time
The availability of leisure time is a key enabling factor in and on y axis this is visitor numbers.
tourism for personal purposes as defined by the UN(2010) o. Physical Capacity Health and Wellness: Physical capacity
holidays leisure recreation VFR, education and training health health and wellness are important variable for tourism to
and medical care religion and pilgrimage and shopping. develop. Wellness is a primary motivation for a trip a conscious
k. Amount of Travel Time: Improved accessibility might reduce choice. Health and wellness is an active or proactive approach to
travel time. If improved accessibility leads to an increase in improve tourism.
 p. Cultural Similarities: The impact of culture on tourism is e. Technological Advancement: The tourism industry is
significant and shows the growing relationship between tourism undergoing a transformation advanced by the use of new
and culture and the way in which they have together become technological by consumers. They can now book every element
major drivers of destination attractiveness and competitiveness. of their trip online be informed by and contribute to review sites
q. Affiliations: There is strong relationship between tourists and navigate their destination with the insight of a resident.
affiliation the strength of their beliefs and their subsequent Technology is upturning the status quo and visitors are now for
visitation patterns. more knowledgeable about where what they want is to be found.
3. Exogenous determinants The rise of the hyper informed tourists is imminent.
a. Availability of Supply Resources: The quality and availability f. Accessibility: Accessible tourism is the ongoing endeavor to
of tourism supply resources are a critical element in meeting the ensure tourist destinations. Products and services are accessible
needs of the ever changing and growing tourism market. As d. to all people regardless of their physical limitations disabilities
Taylor (1980) suggests if the gods and services required by the or age. It encompasses publicly and privately owned tourist
visitor are know it is possible to list their availability in an area locations.
and determine how well the supply matches the demand. g. Levels of Development Infrastructure and Superstructure:
b. Economic Growth and Stability. The relationship between Tourism supply is the combination of natural and man made
economic growth and stability refers to the manner in which the attraction services and goods that are likely to induce people to
political stability of a nation can lead to its economic growth. visit in the particular country. Tourism infrastructure and
This economic growth is instrumental in attracting tourists. superstructure plays a vital role between the supply and demand
c. Political and Social Environment: The removal of political forces with this industry. Infrastructure may be defined as the
barriers and obstacles always has a marked effect on travel. policies and relationship that remove the barriers or obstacles of
Increased political stability brings social harmony thereby free travel. Infrastructure includes water electricity sewage
opening up new prospects for travelers. disposal gas land taxation policies law & order machinery and
d. Recession: Recession is a contraction phase of business cycle. other social facilities & institutions that influence the tourist
Due to the recession there is an impact of slowdown in the motivation. Visas passports currency exchange transportation
tourism and hospitality industry. The impact of the recession can communication hotels motels theme park etc. come under the
be on the expenditures of human and overnight domestic visitors term infrastructure. A superstructure is an upward extension of
and the wider effect on the overall economy. an existing structure above a baseline. This term is applied to
 various kinds of physical structures such as building bridges or affected a far higher number of people (tow fold) compared to
ships. Destination's tourism superstructure includes those epidemic. Travelers may encounter serious health risks that may
facilities that have been developed especially to respond to the arise in areas which accommodation is of poor quality, hygiene
demands of visitors. The most obvious examples include star and sanitation are inadequate. SARs, bird flu, swine flu, Ebola,
hotels restaurants conference center car rentals and major zika are some of the epidemics which grew as pandemics and
attractions. Because of their special tourism orientation the severely influenced unrestricted free mobility of tourists.
characteristics of components of the superstructure are Tourists and locals both can be careers of diseases.
essentially determined by visitor wishes rather than resident j. War, Terrorism: While tourists are free to avoid destinations
desires even though residents often desire many benefits from associated with risk, the consequences of disastrous events on
certain elements of the tourism superstructure. tourist destinations are inescapable and can be profound.
h. Natural Disaster: Natural disaster is natural event such as a Terrorism that targets tourism can be viewed as a disaster for a
flood earthquake or hurricane that causes great damage or loss of destination and ensuing events can create a serious tourism
life. Disasters present challenges to the tourism industry not only crisis.
because of their negative impact on visitor numbers but also due k. Social and Cultural Attractions: The majority of visitors set
to traveler’s potential positive or negative impact on recovering out for cultural tourism are generally motivated by an interest in
destinations. Tourism can draw attention to the destruction culture nature and heritage. For a variety of reasons host
caused by these disasters and attract more support for these communities often are the weaker party in interactions with their
places. Tourists’ spending money at the site of a disaster can guests and service providers. The impacts arise when tourism
give the affected economy a boost but this should occur after the brings about changes in value systems and behavior, thereby
relief efforts have been completed and the local tourism threatening indigenous identity. Furthermore changes often
stakeholders are back on their feet. occur in community structure family relationships collective
i. Epidemic: Changes in the human behavior and life style over traditional life styles, ceremonies and morality. The united
the last century have resulted in an increase of epidemics and nations world travel organization provides us two perspectives
pandemics all around the world. The spread of infectious of the definition of cultural tourism namely a broad and a narrow
diseases among the population is commonly known as epidemics satisfy the human need for diversity, tending to raise the cultural
or pandemics. The difference between these two terminologies level of the individual and giving rise to new knowledge
are related to the number people which is affected, a pandemic is experience and encounters. Broad definition movements of
 persons for essentially cultural motivations such as study tours administrative burden for the citizen and limitation of
performing arts and cultural tours travel to festivals and other administrative costs for the authorities. All of these factors have
cultural events visits to sites and monuments. Narrow definition. implication on tourism.
(UNWTO). Tourism demand could be affected by a wide range of factors
l. Degree of Urbanization: Urbanization is a population shift such as economic attitudinal and political factors but the majority of the
from rural to urban areas, the gradual increase in the proportion econometric studies tend to examine the demand for tourism by
of people living in urban areas" and the ways in which each focusing predominantly on economic factors.
society adapts to the change. It is predominantly the process by
which towns and cities are formed and become larger as more The most demand measures for determining the attractive power
people begin living and working in central areas. Urbanization is of a region or destination include:
operationalized by population economic geographical landscape  Number of visitor arrivals or number of participants:
and social cultural dimensions. Well planned urbanization can be
 Tourism expenditures or receipts:
attraction to tourist but uncontrolled urbanization can be
repulsive to tourist.  Length of stay or tourist nights spent at the destination site:
m. Special Factors (Olympic Games or Mega-Events): By  Travel propensity indexes and :
organizing special events like sports visit year etc. many
 Tourist preferences
countries are increasing the number of tourists.
n. Barriers and Obstacles: An obstacle also called a barrier 3.3 Motivation and Tourism Demand
impediment or stumbling block is an object thing action or
The Motivation Dichotomy: Why Do People Go On Holiday?
situation that causes an obstruction. There are therefore different
types of obstacles which can be physical economic bio In a very comprehensive assessment of tourist motivation
psychosocial cultural political technological or even military that Mountinho (1987:16) defined motivation as a state of need a condition
can repel tourists to visit the affected destination. that exerts push on the individual towards certain types of action that are
o. Restrictions Rule and Laws: Regulation is one of the seen as likely to bring satisfaction. This means that demand is about
instruments through which policy objectives can be realized. In using tourism as a form of consumption to achieve a level of satisfaction
this context a number of important points of interest apply, for an individual and involves understanding their behavior and actions
including efficiency clarity and transparency reduction of the and what shape these human characteristics. This seeks to combine what
the tourist desires needs and seeks from the process of consuming a  To visit friends and relatives
tourism experience that involves an investment of time and money. The
 For business and professional engagements
expectations tourist has a consumer in purchasing and consuming a
tourism product or experience is ultimately shaped by a wide range of  For health treatment
social and economic factors which usual (1998) listed in figure3.1 and  Other more personal motives
which are shaped by an individual’s attitudes and perception of tourist.
Intrinsic and Extrinsic Motivation
Yet tourist motivation is a complex area dominated by the social
psychologists with their concern for the behavior attitudes and thought There is no all embracing theory of tourist motivation due to the
of people as consumers of tourism. A very influential study published in problem of simplifying complex psychological factors and behavior into
1993 by Philip Pearce suggested that in any attempt to understand a universally acceptable theory that can be tested and proved in various
tourist motivation we must consider how to develop a concept of tourism contexts. This is illustrated as needs based approaches, values
motivation in tourism how to communicate this to students and based approaches, benefits sought and expectancy based approaches
researchers who do not understand social psychology and what practical which summarize some of the main theoretical approaches developed in
measures need to be developed to measure people motivation for travel motivation research. The different approaches illustrate that there is no
particularly the existence of multi motivation situations (i.e. more than general congruity between the approaches i.e. there is no common
one factor influencing the desire to engage in tourism). Pearce 1993 agreement or approach which explains the complexity of trying to
also discussed the need to distinguish between intrinsic and extrinsic derive general explanations of motivation among tourists. This resulted
forces shaping the motivation to become a tourist he explored these in a large number of individual studies of tourist motivation dating back
issues further in tourist behavior 2005. to the 1970s (table 3.2) which adopts different theoretical and
conceptual standpoints. One immediate complication is the problem of
There are as many reasons for engaging in tourism as there are
understanding what drives an individual to travel. For example while a
tourists. Different people participate in tourism for different purposes.
business traveler is obviously travelling primarily for a work related
Seemingly very purpose comes with specific tourism demand. One of
reason there are also covert or less overt reasons which are related to
the most common demands is for accommodation. Whatever the
that individual needs and wants. The individual is a central component
intention tourists, should be accommodated in one way or another. The
of tourism demand as no two individuals are alike differences in
most common reasons for travel away from home are.
attitudes. Perceptions and motivation have an important influence on
 For leisure recreation and holidays. travel decisions where attitudes depend on an individual perception of
the world. Perceptions are mental impression of a place or travel goals such as being with family or friends in this respect extrinsic
company and are determined by many attitudes and perceptions in influences on the tourist may be family society with it's standards and
themselves do not explain why people want to travel. The inner urges norms to behavior the peer pressure from social groups and the
which initiate travel demand are called travel motivators.(cooper at all dominant culture. For example one of the cultural motivators of
1993:20) outbound travel fro new Zealand among youth travelers those aged
under 30 years of age is the desire to do the overseas experience the big
What this illustrates is that the individual and the forces
OE. This often gives travelers a chance to engage in a cultural form of
affecting their need to be a tourist is important. Theses force can be
tourism by visiting Europe seeing relatives and friends and achieves a
broken down into intrinsic and extrinsic approaches to motivation. The
number of social goals. The big OE also has an intrinsic function a sa
intrinsic motivation approach recognizes that individual have unique
long haul trip and a sustained time away from the how environment
personal needs that stimulate or arouse them to pursue tourism. Some of
encourages independence self reliance and greater confidence in one
these needs are associated with the desire to satisfy individual or-
own ability and judgment and will contribute to ego enhancement. In
internal need for example becoming a tourist for self- improvement or
the UK there has also been a trend towards a similar experience before
what is termed self realization so as to achieve a state of happiness. It
commencing study at university: it is known as the gap year and a
may also help boost one ego a feature termed ego enhancement because
similar style of travel working holiday voluntary activity or round the
of the personal confidence building that travel can encourage. In
world trip takes place.
contrast the extrinsic motivational approach examines the broader
conditioning factors that shape individuals attitudes preferences and While analysis of tourist motivation is about the underlying
perceptions but are more externally determined for example the society psychological value and features of being a tourist actual tourism
and culture one lives in will affect how tourism is viewed. In the former demand at a practical level is derived through a consumer decision
Soviet Union tourism was a functional relationship that was conditioned making process. From this process it is possible to describe three
by the state that sent workers for rest and recreation so they could return element which condition demand:
refreshed to improve output and productivity. In contrast in a free 1. Energizers of demand which are factors that promote an individual
market economy the individual is much freer to choose how and where to decide on a holiday
they wish to travel within certain constraints e.g. time income and
awareness of opportunities. At a general level tourism may allow the 2. Filterers of demand which are constraints on demand that can exist
individual to escape the mundane thereby achieving their goals of in economic sociological or psychological terms demand to go on
physical recreation and spiritual refreshment as well as enjoying social holiday or travel
3. Affecters which are a range of factors that may heighten or suppress emphasize the development needs of humans with individuals striving
the energizers that promotes consumer interest or choice in tourism. towards personal growth and these can be understood in a tourism
context.
These factors directly condition and affect the tourist’s process
of travel decision making although they do not explain why people
choose to travel. For this reason it is useful to understand how an
individual desires and need for tourism fit into their wide life. This
partly reflects upon the intrinsic motivations and one useful framework
devised to understand this is Maslow's hierarchy of human needs.
Maslow's Hierarchy Model And Tourist Motivation
Maslow's (1954) hierarchy of needs remains one of the most
widely discussed ideas on motivation. It is based on the principle of a
ranking or hierarchy of individual needs figure 3.5 based on the premise
that self actualization is a level to which people should aspire. Maslow
argued that if the lower needs in the hierarchy were not fulfilled then
these would dominate human behavior. Once these were satisfied the
Maslow's work has also been developed since the 1950s when
individual would be motivated by the needs of the next level of the
work on specific motivations beyond the concept of needing to get away
hierarchy. In the motivation sequence Maslow identified or tension
from it all for example push factors that motivate individuals to seek a
reducing motives and inductive or arousal seeking motives cooper et al
holi day have been researched and compared with pull factors e.g.
(1993:21)arguing that the model could be applied to work and non work
promotion by tourist resorts which act as attractors see table 3.3.
contexts such as tourism and leisure. Yet how and why Maslow selected
Rayan's (1991:25-9) analysis of tourist travel motivators excluding
five basic needs remains unclear although it appears to have a relevance
business travel identified a range of reasons commonly cited to explain
in understanding how human action is related to understandable and
why people travel to tourist destinations for holidays:
predictable aspects of action compared to research that argues that
human behavior is essentially irrational and unpredictable. Maslow's  A desire to escape from a mundane environment
model is not necessarily ideal since needs are not hierarchical in reality  The pursuit of relaxation and recuperation functions
because some needs may occur simultaneously. But such a model does
 An opportunity for play However key events of 2008 had a major pull effect on the destinations
which visitors chose including:
 The strengthening of family bonds
 The Beijing Olympic games
 Prestige since different destinations can enable one to gain social
enhancement among peers  Singapore hosting its first formula 1 race

 Social interaction  The 60th celebration of the state of lsrael

 Education opportunities  Dubai acquiring the QE2 as a floating hotel

 Wish fulfillment  the Euro 2008 football tournament in Austria and Switzerland

 Shopping  Berlin celebrating the 60th anniversary of the airlift to keep the city
supplied during the communist blockade which lasted year in 1948
Escape, socializing, fun/excitement, relaxation, prestige and
educational motives are push factors and ease of access, cost of travel,  Valencia in Spain hosting the America’s cup
promotional image of destination and sun, sea, sand are pull factors. Even so the ranking of UK package destinations has remained
These factors motivate persons to be the part of tour. fairly consistent in terms of the locations chosen with Spain maintaining
From this list it is evident that its prominent position as the most popular country in 2007 also see
chapter 2 Spain maintained its position as the overall top choice of
Tourism is unique in that it involves real physical escape
destination for holidaymakers followed by France USA Italy Greece and
reelected in travelling one or more destination regions where the leisure
Ire land.
experience transpires thus a holiday trip allows changes that are multi
dimensional place pace faces lifestyle behavior attitude it allows a Cuebro Ramumbo Classification of Motivations
person temporary withdrawal from many of the environments affecting 1. Physical Motivators: which are related to physical relaxation and
day to day existence. (Leiper 1984 cited in Pearce 1995: 19) rest sporting activities and specific medical treatment. All are
It is also evident that fashion and that have a major bearing on connected with the individuals bodily health and well being
the destinations people choose to go to for holidays. For example in 2. Cultural Motivators: which are connected with the individuals
2007 over 70 million trips were undertaken by UK residents to overseas desire to travel in order to learn about other countries and their
destinations of which the growth market was in longhaul destinations.
 people and their cultural heritage expressed in art music literature Among the above four categories the doer criterion and
folklore etc. pecuniary criterion dominate international tourism demand studies.
Considering statistical availability and consistency between data sources
3. Interpersonal Motivators: which are related to a desire to visit
tourist arrivals ATM and tourist expenditure TE receipts are the most
relatives, friends of to escape from one's family workmates of
commonly used tourism demand measures in empirical studies along
neighbors or to meet new people and forge new friendships of
with their derivatives, such as the tourist participation rate derived from
simply to escape from the routine of every day life.
tourist arrivals divided by population of the origin country region TA_p
4. Status And Prestige Motivators: which are identified with the and tourist expenditure per capita derived from total tourist expenditure
needs of personal esteem and personal development. These are divided by population TE_P.
related to travel for business of professional interests for the purpose
Possible causes of high and low travel propensity
of education and the pursuit of hobbies.
High travel propensity Low travel propensity
3.4 Measuring Tourism Demand
 High education  Low education
Tourism demand can be measured in a variety of ways.  More awareness  low awareness
(Kim 1998 p 25)categorized the measurement criteria for all  More income  Low income
types of travel and tourism demand into four groups:  Private vehicle  No ownership of vehicle
 Better travel facilitation  Poor travel facilitation
i. A doer criterion : such as the number of tourist arrivals the  Good exchange rate  Poor exchange rate
number of tourist visits and the visit rate:  Shorter travel distance  Long travel distance
 Low travel cost  High travel cost
ii. A pecuniary criterion: for example the level of tourist
 Young age  Old age
expenditure (receipts ) and share of expenditure (receipts) in Remembering the determinants of tourism demand for tourism
income : can be measured in following terms
iii. A time-consumed criterion: such as tourist days tourist Buhalis three main types of demand namely actual suppressed and latent
nights and demand are-
iv. A distance travelled criterion: for instance the distance 1. Actual Or Effective Demand. The effective demand, which is the
travelled in miles or kilometers. number of people participating in tourism commonly expressed as
 the number of travelers. It is normally measured by tourism statistics A useful measure of effective demand in tourism is net
typically departures from countries and arrivals at destinations. travel propensity
2. Suppressed demand Suppressed demand which consists of the Net Travel Propensity- Percentage of population of the overall
proportion of the population who are unable to travel because of population who makes at lest one trip during a given period of time.
circumstances e.g. lack of purchasing power or limited holiday
entitlement. The so called suppressed demand created by two
categories of people who are generally unable to travel due to Net Travel Propensity =
circumstances beyond their control. Number of population taking at least one trip
×100
Total population
a. Potential demand: the first group would include those sections
of the population who would like to be involved in the tourism Gross Travel Propensity: Gross travel propensity is the total
process but for some reason or another cannot since they may number of tourism trips taken as a percentage of the population.
participate at a later date their situation is referred as Number of total trip
Gross Travel Propensity = ×100
representing potential demand Total population

b. Deferred demand: deferred demand describes the second sub- Gross travel propensity can exceed 100% as it also takes into
category of suppressed demand in that travel is postponed due to account those who make more than 1 trip away from home.
problems in the supply environment. Potential and deferred Grosstravel propensity
Travel Frequency =
demands are difficult to measure and it is for that reason that Net travel propensity
they are rarely taken into account.
Determinants of travel propensity are divided into 3 broad groups :
3. Latent demand: It relates to the spatial and temporal expression of
i. A world view: economic development population characteristics
demand at a specific site for example demand for either tourist
and political regimes
accommodation or a tourist service at a specific destination.
ii. A personal view: lifestyle life cycle and personality factors
Actual or effective demand can be measured in terms of travel
propensity. Travel propensity measured the percentage of a iii. Life style determinants
population that actually engages in tourism. Suppressed and no Demand ensure that net travel propensity never
approaches 100% its maximum is likely to be 70%-80%.
In continuation with above measures the important data required for  International tourism expenditure
measuring tourism demand are-  International tourism receipts
 How many visitors arrived ?  Leisure trip
 By what means of transportation? Visitor Profiles Includes
 How long they stayed and in what type of accommodation?
Visitor Name Origin and Destination
 How much money was spent? age Model of transportation
Sex Purpose of visit
On availability of data above tourism demand can be measured at Group type Length of stay
three levels Nationality Accommodation used
Occupation Activities
 Product level - total product tourism items Income Tour or independently organized
 Geographical level - world country or destination
Now, Measure the demand by:
 Time level present short medium or long term
D= f (propensity resistance)
WHAT IS MEASURED IN TOURISM DEMAND?
Propensity = person's predisposition to travel
Volume Statistics
= how willing is the person to travel
 Total number of individual tourist arrivals and the total number
of tourist departures = what types of travel experiences he/she prefers

 No. of trips = (no. of individuals) ×(no. of trips per individual) Resistance = relative attractiveness of various destinations

 Total tourist nights= (no. of trips)×(average length of stay) 3.5 Tourism Statistics
Value Statistics According to statistics at national regional and global lavel refer
 Measurement of economic value of foreign visitors and outgoing to world travel tourism council report 2015, the trends and
visitors expenditure transformations in global travel and tourism can be assessed at different
but interrelated geographic levels: the global the regional and the
 International tourism expenditure
national. In fact most textbooks cover what is usually referred to as the
geography of travel and tourism at these three levels. Similarly the regions or countries they tend to be regionalized i.e. within particular
WTO provides detailed national data for most tourism receiving regions and polarized i.e. between particular countries. These patterns
countries but assesses their implication in both global terms and are to an extent influenced by the historical driver of the growth in
according to six (somewhat arbitrary) international regions. travel and tourism but global tourist flows are also determined by:
Each level of analysis tells us a different story : however not  The nature and supply of tourism resources natural man made
only are there themes common to each but also they contribute cultural at the global and national scales
collectively to an overall picture of global travel and tourism  Distance between destinations and main generating regions
Global Level  Transport and communication networks
1. Dramatic growth of travel and tourism  Climate and climate change
2. The contribution of travel and tourism to the global economy.  National and international political economy
Most commonly a global perspective on travel and tourism FOCUESE  Globalization of the world economy and business.
UPON TWO key issues:
Regional level
1) The worldwide scale and value of travel and tourism has grown
dramatically in terms of both arrivals and receipts. However the key Regional perspective on global travel and tourism is concerned
point is that although the annual rate of growth is slowing travel and with:
tourism is resilient to external factors. Major events such as 9/11 - An analysis of the volume value and growth trends of travel
have only limited and temporary impacts on overall grow of travel and tourism within regions
and tourism which is fore cast to continue in the forseeable future.
- Comparisons between regions
2) The contribution of travel and tourism to the global economy. The
An noted travel and tourism flows are highly regionalized that is
most powerful justification for developing tourism is its contribution
the most significant flows of international tourism occur within
to national regional and global gdp and employment.
particular regions.
However it is also important to recognize the global patterns of
At the same time the WTO divides the world into six regions
travel and tourism flows trends and the reasons for them. Specifically
that also have their own regional for example PATA, CTO or sub-
travel and tourism flows are not equitable or equality enjoyed by all
regional tourism organizations which collate and disseminate Travel and tourism statistics relating to individual countries are
information develop regional tourism policies and so on. usually complied into annul league table of the world's leading tourism
generating countries either by departures or spending and tourism
Moreover many external influences wars terrorism health scares
destination countries either by the number of arrivals or tourism
etc. are most keenly felt at the regional level.
receipts.
Therefore a regional perspective on global travel and tourism is
These provider of course an indication of how each country is
concerned with:
performing relative to other tourism destinations that is their share of
 An analysis of the volume value and growth trends of travel global travel and tourism as well as providing a more detailed picture of
and tourism within regions the potential for future growth the shifting patterns of tourism flows.
and regional policies and
However at the national level it is also vital to consider the
 Comparisons between regions. This the principal means of volume value of travel and tourism relative to other national criteria
identifying and explaining transformations in the patterns of such as employment or contribution to GDP. In other words global
international tourism flows. league tables of international tourist arrival / receipts tend to disguise
National level the varying importance of the travel and tourism sector in many LEAST
DEVELOPED COUNTRIES (LDCs) is insignificant in global terms but
Different picture of global tourism:
is often the largest economic sector within the country. Therefore when
 How each country is performing relative to other tourism countries are listed according to the importance of tourism to the
destinations national economy a very different picture of global tourism emerges.
 The national level it is vital to consider the volume value of The WTTC's country league tables accessible on the WTTC website
travel and tourism relative to other national criteria such as provide much of the information you might requires.
employment or contribution to GDP. 3.6 Major Tourism Markets of Nepal
When countries are listed according to the importance of tourism The tourism industry is experiencing a tremendous growth with
to the national economy a very different picture of global tourism an ever increasing pressure from number of destinations. The change of
emerges. tourism market in Asian requires Nepal to develop an effective
marketing plan and strategy to attract Asian tourists from china, India,
Japan , South korea and Malaysia. In the southeast Asian region several 11 Hetauda, Birgunj, Heatuda, Birgunj, Samara, Janakpur
Janakpur
countries particularly Thailand Malaysia and Singapore are competing
12 Trishuli, Gorkha, Trishuli, Manakamana, Gorkha ,Bandipur,
with each other to be regional tourism hubs in southeast Asian. Bandipur, Besisahar Damjauli, Besisahar
13 Lumini, Palpa, Butwal Tansen, Butwal, Bharirahawa, Sunauli,
The rapid economic growth in Thailand south Korea, Hong Siddharthanagar, Lumbini
Kong and Malaysia has led to a large increase in national income and 14 Nepalgunj, Bardiya and Nepalgunj, Gulariya, Thakurdwar, Surkhet
Surkhet
hence disposable personal income. Indian and china is by far the most
15 Dhangadhi and Dhanadhi, Mahendranagar, Shuklaphanta
important tourist generating countries for Nepal and there has been a Mahendranagar
recent substantial increase in the value of international travel and 16 Other miscellaneous Kodari highway Sindhupalchowk, Kakani,
areas Daman, Kharndbari, Sirubari, Barapak
tourism revenues and holds promising future prospects.
s.n Destinations/sites Major place covered
1 Kathmandu and Lalitpur Kathmandu and Lalitpur urban, areas, 3.7 Emerging Trends and New Thrust Areas of Nepalese
Godavari, Hattiban, Gokarna Tourism
2 Bhaktapur, Nagarkot, Nagarkot, Bhaktapur, Dhulikhel,
Dhulikhel Panauti,Namobuddha With the world tourism fraternity looking at Nepal with renewed
3 Pokhara valley Pokhara city and nearest surroundings
interest the time for Nepal has finally arrived with the current tourism
4 Annapurna region Ghandruk rout,ABC treak ,Jomsom,
Lomangthang, Muktinath, Manang, boom people across the world are looking at Nepal as a top destination.
Ghaleguan areas
5 Chitwan area Chitwan NP and surroundings, Kurintar, Ministry of tourism should realize that:
Bhartpur Nawalparasi
6 Everest region Junbesi, Salleri, Kukla, Namche, Everest 1. Amenities need to be in place for people to come and enjoy their
base camp experience.
7 Rolwaling, number Charikot Rolwaling, Jiri, Shivalays,
sailing Bhandar, number,Sailing Lubughat, (IP 2. Concerted efforts required in creating awareness through many
trail) campaigns.
8 Langtand, Helambu Tamang heritage Trail, langtand , Kanjin
region trail, Goshikunda Trail, Chisapani 3. Better connectivity and up gradation of tourism infrastructure.
Helambu region
9 Biratnagar, Jhapa, Ilam, Biratnagar ITAHARI, Kakadbhittak, 4. Marking Nepal an accessible destination for tourists across the globe
Dharan and Dhankuta Damak, Ilam, Phikkal, Dharan, Bhedetar, e.g. visa ease) efforts like visit Nepal
Dhankuta, hike
10 Kanchenjunga region Phungling, Suketar, Phungling-Ghunsa
route
 Social trends and political developments seem to be the most against conventional tourism rural tourism has certain typical
influencing factors. The changing nature of tourism system itself is also characteristics like it is experience oriented: the locations are
driving CHANGES INTERNALLY within the sector technological sparsely populated it is predominantly in natural environment it
advancements are also going to affect the tourism industry. meshes with seasonality and local events and is based on
preservation of culture heritage and traditions. All forms of tourism
Emerging trends and new thrust areas of Nepalese Tourism are:
in rural areas bring in income and regenerate vibrant rural
1. Rural tourism communities. Rural tourism varies in its type from country to
2. MICE tourism country. In Japan the most common type of farm tourism in the farm
in which offers accommodation and meals. In Europe romantic rural
3. Wedding tourism
tourism focuses on jeep safari. In Nepal the emphasis is on traditions
4. Eco-tourism arts and crafts.
5. Medical tourism 2. MICE Tourism: The term "MICE" in the context of travel is an
acronym for meetings incentives conferences and exhibitions/events.
6. Mountaineering
It refers to a specialized niche of group tourism dedicated to
7. Trekking
planning booking and facilitating conferences seminars and other
8. Water tourism events.
9. Ethnic tourism Sometimes referred to as the meetings or events industry MICE
10. Agro-tourism travel involves a number of components they include

1. Rural Tourism: It is taking place in rural areas or settlements  Corporate meeting planners
providing employment and income to local population and offering  Meetings and convention departments of hotels
individualized holiday products to consumers. Rural tourism is
 Conference centers or cruise ships
based on accommodation service which is complemented by
additional service/facilities relying on the local social cultural and  Food and beverage managers
natural resources which are exploited according to the principles of  Logistics firms
sustainable development. It is multi-faceted and may entail
farm/agriculture, cultural, nature adventure and eco-tourism. As
3. Traditional Wedding: Tour in Nepal provides access to knowledge availability of procedures and for treatments that are visiting. Nepal
of the wedding system of Hindu and Buddhists of the country. The has become a major surrogacy destination for Israelis who because
wedding practices of the country are unique and unalike to rest of they are unmarried or gay not obtain surrogacy in Israel. India and
the traditions of the world. You can also participate in wedding Thailand had been the prime choice for surrogates but those
ceremonies of different ethnics and castes of Nepal. The particular countries two years ago restricted surrogacy to married couples.
tradition varies in accordance to caste and ethnicity of the couple. Indian women already pregnant with children commissioned by
The traditional way of Nepalese wedding attracts many of the unmarried persons then went to Nepal to give birth.
visitors. Some to them are inspired to so extent that they decide to With surrogacy available in Nepal for s30000-s50000, rather than
re-marry in accordance to Nepalese way of wedding. Most of the s150000 in the United States Israeli surrogacy agencies started
wedding ceremonies take place in the Nepali month of Mangsir. arranging surrogacy births there even while Indian rather than
4. Eco – Tourism: This tourism in Nepal is the main forms of tourism
Nepalese women are usually the carriers.
in the county aside form the attractions of Kathmandu and other
6. Mountaineering: Nepal is a country well known for its Himalaya
historical cities. Ecotourism is perhaps nowhere more relevant than
in Nepal. When massive mountains rolling hills abundant vegetation Mountains among the 10 highest peaks in the world eight including
and diverse wildlife it is little wonder that Nepal is popular tourist the highest peak Mt. Everest crown this country. Mountaineering in
destination and the ideal location for ecotourism. Ecotourism in Nepal is a prime tourism activity proving Nepal the cradle for
plain is a system of traveling to destinations where nature comes mountaineers for ages. Nepal mountaineering with one of the major
before anything else. As a traveler you play an important role in the activities which position Nepal as ultimate in high altitude
lives of locals by appreciating their gifts their nature society and mountaineering with no substiture. Nepal is the home to the highest
culture and traveling as if you were living and celebrating your life mountains in the worked including Mt. Everest Mt Kanchenjunga
in that place just like the locals. Mt Dhaulagiri Mt Annapurna and many other peaks famous in the
5. Medical Tourism: It is the act of traveling abroad to receive
world of mountaineering.
7. Trekking: It is a form of walking undertaken with the specific
medical dental and cosmetic care. Medical tourism is also known as
medical travel health tourism surgical tourism health travel medical purpose of exploring and enjoying the scenery. It usually takes place
outsourcing and medical value travel. Significantly lower costs for on trails in areas of relatively unspoiled wilderness. Trekking is
best practice care are usually the primary motivation in medical combination of hiking and walking activity in which people take
tourism although some medical tourists go abroad for immediate multi days trips in rural un development area. In another words
 trekking is making a journey trip on foot especially to hike through countryside and reversal of urban trend. It brings tourists to the
mountainous areas often for multiple day and along lovely countryside instead of over populating cities.
mountains villages and enjoying nature and or close contact with
people in remote mountain village where lifestyle sometimes is
unchanged since many generation.
8. Water Tourism: It involves traveling to locations specifically to
take part in water based activities. Water tourism is travelling by
boat while on holiday with the express purpose of seeing things
meant for the water tourist while water tourism often involves active
pursuits. Some water tourists visit islands and coastal regions in
order to participate in more leisurely pursuits such as diving or
snorkeling. Tourists often visit well known destinations such as
major water parks popular lakes or well renowned beach locations
but some travel firms market deluxe vacation to remote regions such
as islands in the south pacific.
9. Ethnic Tourism: Nepal is a multi-ethnic multi cultural multi
religious and multi-lingual nation, pluralism and diversity its unique
and notable features. Ethnic tourism is when travelers choose to
experience firsthand the practices of another culture and may
involve performances presentations and
10. Argo tourism is a style of vacation which is normally on farms.
This may include the chance to help with farming tasks during the
visit. Agro tourism is developing into a large part of the tourism
industry and will soon be one of the largest sectors of tourism.
People are more interested in how their food production. Agro
tourism has various different economic and socio cultural aims. The
basis of the program is the program is the revitalization of the