This document outlines the key characteristics of tourism, including intangibility, perishability, heterogeneity, seasonality of demand, interdependence, fixed and variable costs, and inseparability. It emphasizes that tourism services cannot be physically evaluated before purchase, cannot be stored, and are subject to variability due to human involvement. Additionally, it highlights the importance of understanding costs associated with tourism services and the interconnected nature of various services experienced by tourists.
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THM Lesson 1
This document outlines the key characteristics of tourism, including intangibility, perishability, heterogeneity, seasonality of demand, interdependence, fixed and variable costs, and inseparability. It emphasizes that tourism services cannot be physically evaluated before purchase, cannot be stored, and are subject to variability due to human involvement. Additionally, it highlights the importance of understanding costs associated with tourism services and the interconnected nature of various services experienced by tourists.
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TOURISM AND HOSPITALITY MARKETING
LESSON 1: CHARACTERISTICS OF TOURISM
1. Intangibility Cannot be touched, gripped, handled, seen, smelled, tasted or heard before purchase. Unlike goods, which can be touched and inspected before purchase, tourism services are essentially intangible. However, customers use other cues to help them evaluate the service: the appearance of the hotel entrance or the behavior of the receptionist. 2. Perishability Tourism service cannot be stored like tangible products. A hotel room or airplane seat that is not sold on a particular night/day can never be sold. Unused capacity cannot be stored for future use. For example, spare seats on one airplane cannot be transferred to the next flight, and query-free times at the reference desk cannot be saved up until there is a busy period. 3.Heterogeneity (or variability): The extensive involvement of people in the production of a tourism service introduces a degree of variability in the outcome. There is a strong possibility that the same enquiry would be answered slightly differently by different people (or even by the same person at different times). The same employee may hence render services of varying standard, depending on his mood, the time of the day, the day of the week or the customer involved. 4. Seasonality of demand Most tourist destination areas are characterized by fluctuating periods of demand called ‘peaks’, ‘shoulders’ and ‘troughs' Peak – Time of the year during which demand is highest. Shoulder – An abbreviated season that falls between the peak and low troughs Troughs - off season, time of the year during which demand is very low. 5. Interdependence "Interdependence" occurs because when tourists visit a destination their experience is made up of several services, such as accommodation, transportation, and attractions. Even an individual tourist buys a whole set of products supplied by different firms – the attractions have no economic value without the necessary accommodation. 6. Fixed and Variable Costs Fixed costs are costs that are independent of the number of customers and must be paid anyhow, whereas variable costs are costs that are incurred as a function of the number of customers received at any given time. 6.1 Fixed Costs These costs have to be met whether the hotel or air charter draws few or many visitors. A hotel, an air charter or a tourism attraction has in any case to finance the following costs in order to be open and to receive customers: Maintenance, Energy and utilities, Insurance, Property taxes, Wages and salary costs for employees 6.2 Variable Costs A variable cost varies in direct proportion to the level of business activity. Examples of variable costs include cost of casual labor, guest supplies, Travel agents’ commission, laundry in a hotel, and beverage cost of sales and the cost of raw material such as food in a restaurant. 7. Inseparability The tourism service consumer is inseparable from service delivery because he is involved in it from requesting it up to consuming the rendered benefits. Tourism service cannot be separated from its provider. The hotel guest cannot experience counter service if the receptionist is not available, nor can the receptionist render the service if there is no guest.