Chapter 6
DESTINATION MANAGEMENT SYSTEM
NATURE OF A NATIONAL TOURISM OFFICE
One of the main tasks of National Tourist Offices (NTOs) that are
called often Destination Marketing Organizations (DMOs) is to create a platform
for the development of tourism demand at the level of the nation as a
destination, while promoting vertical cooperation with Tour Operators in the
outbound markets and domestic regional tourism Associations, in the area of
marketing. Until recently and still for the vast majority of DMOs, the main
concern is market communication for the purpose of positioning the destination
in relation to worldwide competitors, making use of conventional media.
Generally the DMOs do not attempt or take very little advantage of other
marketing mix tools such as product development, pricing policy or
distribution. With some exceptions, they are among the less developed players
in the online tourism industry.
Tourism Destinations emerge as umbrella brands and they need
to be promoted in the global marketplace as one entity for each target market
they want to attract (Paulo Rita, 1999). Tourism is a networked and
information- intensive industry. The success of DMOs depends therefore on the
quality of the
infrastructure (e.g. road, highway system) of the destination
they represent (Gartrell, 1988). The Internet is part of the infrastructure.
Thus, the mission of National Tourism Offices in contributing to the domestic
economy by maintaining destination attractiveness and by increasing the
awareness of prospective visitors is challenged by a whole new environment. It
is difficult for most of NTOs to keep pace with the emergence of innovative
marketing strategies based on ITs. In these new conditions set by the ITs'
revolution, DMOs need to determine to what extent they wish to make use of the
possibilities offered by information technology, and with what systems. The
question of how to move from the current way of doing business to one that is
responsive to these changes becomes a vital concern (Gretzel, et. al.,
2000).
COMPREHENSIVE STUDY OF A DMS
Definition
A Destination Management System is a web based integrated
information, destination marketing and reservation systems. They
may be referred elsewhere as Destination Databases or Destination Marketing
Systems. It is a combination of technological enablers and demand drivers that
has propelled the realization of destination management systems (Buhalis &
Spada, 2000). Buhalis and Pringle described it as:» a collection of
computerized information, interactively accessible, about a
destination».
DMSs are usually managed by destination management organizations
witch may be public such as state tourism offices or private organizations or a
combination of both (Pollock, 1998). They must provide timely, appropriate and
accurate information for tourism stakeholders:
u On the demand side they cater for multiple forms of access by
potential visitors, directly or through travel agents and tour operators,
through call
centers, visitor information centers, airlines' GDS, Internet and
interactive Web television. Potential visitors can be logged into a client
database and tracked through their purchase life cycle.
u On the supply side DMSs provide a comprehensive database of
products and services that the destination has to offer. Destinations
Management Systems are attractive to the consumer as well as the travel trade
as they provide a one-stop marketplace.
Historic background
More than 200 DMSs have been conceptualized and developed around
the world the last decade. However few systems have reached the major goal as
global distributors of all products of tourism destinations. The grand majority
of these systems have been implemented in local level and operate on a limited
basis, thus many of them had collapsed few years after their initial
development. (Buhalis, Spada, 2000).
DMSs are often limited in their scope and ambition by a
non-supportive organizational structure or by their technology. As a result
many commercial structures emerged with the consequence of inaccurate
information range since they favor big suppliers that can afford membership
fees in detriment of SMTEs with weaker financial resources (Buhalis, Spada,
2000). Therefore, destinations with an economic tissue mostly constituted by
low tech and marginalized regional SMTEs will suffer setbacks that are likely
to disadvantage their regional tourism industry development.
DMS Fundamental Objectives
The overall objectives of a DMO are to increase the productivity
of public and private tourism professionals, and to improve the satisfaction of
the international tourists through the use of advanced information and
communication technology, in order to create economic wealth and jobs. In
particular, DMSs look after the followings:
· The availability of an Internet server offering
information and primarily dissemination of tourism marketing information and
execution of electronic bookings and payments
· A critical mass of users/beneficiaries sufficient for the
self-support of the system and its organization
· The promotion of STMEs in the global market with low
costs
· The exploration of new and niche markets.
· Forecasts and a better understanding of the
evolution of the market.
· Increase of knowledge and capacity of the DMOs and
SMTEs to answer to the market trends.
The DMS aims to provide with all the information that a
potential visitor might need to make the decision to become an actual visitor,
and to choose that destination out of all other alternatives. The DMS is
therefore a marketing tool for the whole destination in a virtual context.
Consequently a virtual destination must not be a repository of information from
a single source but rather from an entire community that is competing in the
international tourism market. It is an extremely interactive communication tool
that encourages communication between its visitors and the members of the
community it represents. It promotes communication beyond the realm of business
but favors and encourages ultimately online transactions.
Destination Stakeholders' objectives
From a product supplier perspective a DMS can
assist its enterprise to know more on what the existing and potential costumers
want, to reach them, satisfy their needs in order to operate its business
profitably. Moreover the global e-marketplace accessibility is provided to the
full range of tourism enterprises, from the five star resorts to the craft
shops. At the same time they are able to
benefit from NTOs promotional activities and trade under a
widely known umbrella brand of the national destination.
The National Tourism Offices' objectives are
more complicated, in view of their mission and responsibilities. They do not
market accommodations or transportation but provide physical data and data
mining. In fact they are in the business of shifting the market information
back and forward. Their main objective is to foster an environment in witch the
tourism sector can prosper through well-directed marketing operations,
information integration, training and regulations.
For the consumer, simplicity, quick access to
accurate information and booking facilities to speed up travel decision while
saving money are the most important objectives. Visitors traditionally are
interested in both natural beauty and cultural heritage; but in addition to
such attractions they like to be able to choose their own products and get an
emotional experience.
DMS s' Success Criteria
As «info-structures», DMSs must enable destinations
to disseminate comprehensive information about resources and services of a
destination and local tourism products as well as to facilitate the planning,
management and marketing of countries as tourism entities or brands. However
previous failures
have prompted for the need of a close examination on success
criteria that have to be taken into consideration before conceptualizing and
developing a DMS.
Recently, an exploratory research combining qualitative and
quantitative methodologies conducted by Dimitrios Buhalis, Senior Lecturer,
School of Management Studies, University of Surrey (U.K), demonstrated the
important necessity of public - private sector cooperation, as being the most
powerful enabler of a DMS development and implementation. However, lack of
commercial background and bureaucracy often diminish public agencies capability
to foster greater cooperation between industry's stakeholders and to exercise
influence over the direction of DMSs' success criteria.
Buhalis and Spada synthesized the research results by proposing
a «5'Cs»framework namely: Choice, Convenience, Consistency and
Competitive Pricing, that groups identified DMS's success criteria for six key
tourism stakeholders. The following figure present most important selected
criteria among stakeholders:
Tourism Supplier
Use of DMS as promotional tool Provisions of guaranteed
bookings
DMS's ability to distribute info globally
Reduction of IT cost
User-Friendly
Public sector
Use of DMS as promotional tool
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Public sector
Marketing tool
Support of SMTEs Economic benefits Quality and accuracy Use
DMS as management tool
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Consumer
Comprehensive info before, during, and after trip
Speedy transactions
Secure online payments
User-friendly system
Multi-channel access
Virtual tour
Wild range of choices
Help function
|
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TOs
Reduction of distribution & communication costs
Market info
Inventory management
Minimum membership fees
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Travel Agents
Info reliability & accuracy
Real time info
Use of DMS to compete with TOs Online bookings capability
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Investors
Profit center ability
Private -Public partnership
System's operating efficiency
System's Ability of strategic alliances
System's ability to interface with other systems Profitability
of membership fees
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Figure 8. Success Criteria for a DMS (With reference to Buhalis
& Spada, 2000)
The five values (5Cs), which synthesize the above success
criteria, are the guiding requirements of a successful conceptualization and
development of a DMS. Therefore, various stakeholders' cooperation is critical
to achieve this cooperative network, so all actors can enable the creation of
this value chain of: Awareness- Information-Booking-Consumer Relationship. On
one hand the public sector boasts considerable degree of influence through
planning and legislation. It represents a major tool for fostering cooperation
among different stakeholders. On the other hand the private sector involvement
is significant in contributing essential capital, know how and commercial drive
that determine the profitability and viability of a DMS.
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