Chapter 4 Destination Development. Objectives Determine what attracts tourists to different...

Chapter 4Chapter 4Destination DevelopmentDestination Development

ObjectivesObjectives

Determine what attracts tourists to Determine what attracts tourists to different destinationsdifferent destinations

List and describe each of the steps List and describe each of the steps involved in the planning and involved in the planning and development stages of a destinationdevelopment stages of a destination

Identify the four stages of the product Identify the four stages of the product life cycle and apply them to a specific life cycle and apply them to a specific case in destination developmentcase in destination development

ObjectivesObjectives

Distinguish between the multiplier Distinguish between the multiplier effect and revenue leakage.effect and revenue leakage.

Discuss the physical, economic, and Discuss the physical, economic, and social impacts of tourismsocial impacts of tourism

Explain how tourism can help preserve a Explain how tourism can help preserve a local culturelocal culture

Identify the possible negative effects of Identify the possible negative effects of destination development on a local destination development on a local environment.environment.

What makes a place What makes a place worth traveling to?worth traveling to?

People usually travel to destinations to People usually travel to destinations to participate in at least one of three sectors of participate in at least one of three sectors of the tourism industry:the tourism industry:

Adventure tourism and recreation (e.g., White Adventure tourism and recreation (e.g., White water rafting, hunting, fishing, skiing, golfing)water rafting, hunting, fishing, skiing, golfing)

Attractions (e.g., galleries, historical sites, Attractions (e.g., galleries, historical sites, museums, theme parks) and natural wondersmuseums, theme parks) and natural wonders

Meetings, events, and conferences (e.g. Meetings, events, and conferences (e.g. conventions, training sessions, festivals)conventions, training sessions, festivals)

Components of Tourism Components of Tourism DestinationsDestinations

There are five necessary TOURISM There are five necessary TOURISM DESTINATION COMPONENTS that DESTINATION COMPONENTS that make a location a viable tourist make a location a viable tourist destination:destination:

1) Natural resources: A tourism 1) Natural resources: A tourism destination must have the climate, destination must have the climate, terrain, water, and vegetation to terrain, water, and vegetation to support activities for visitors.support activities for visitors.

Components of Tourism Components of Tourism DevelopmentDevelopment

2) Infrastructure: Once a destination has 2) Infrastructure: Once a destination has been identified for development, an been identified for development, an infrastructure (heat, electricity, water, infrastructure (heat, electricity, water, roads, communication, etc.) must be built roads, communication, etc.) must be built to support visitors.to support visitors.

3) Superstructure: Once the infrastructure 3) Superstructure: Once the infrastructure is in place, a superstructure can be built. is in place, a superstructure can be built. (Buildings and attractions: CN Tower, (Buildings and attractions: CN Tower, Notre-Dame Basilica, etc)Notre-Dame Basilica, etc)


4) Transportation systems: Once the 4) Transportation systems: Once the infrastructure is in place, and the infrastructure is in place, and the superstructure has created places superstructure has created places worth linking, the transportation worth linking, the transportation systems can be organized to tie systems can be organized to tie everything in a destination together.everything in a destination together.

Some will include transportation Some will include transportation systems within the Infrastructure systems within the Infrastructure category.category.


5) Hospitality of the Hosts: A 5) Hospitality of the Hosts: A destination will not flourish if destination will not flourish if tourists do not feel welcome. So an tourists do not feel welcome. So an important component of important component of destination development is making destination development is making sure the destination gains a sure the destination gains a reputation for hospitality.reputation for hospitality.

Destination Destination DevelopmentDevelopment

Destination Development begins Destination Development begins with an idea and the selection of a with an idea and the selection of a site. Who gets the idea to develop site. Who gets the idea to develop an area as a tourist destination?an area as a tourist destination?GovernmentsGovernmentsEntrepreneursEntrepreneurs

The Planning StageThe Planning Stage

Planning can be broken down into five Planning can be broken down into five main components:main components:• Market analysis- Studying travel trends Market analysis- Studying travel trends

and tourist preferences in order to find and tourist preferences in order to find if your destination is worth traveling if your destination is worth traveling to.to.

• Site Assessment – Answers two main Site Assessment – Answers two main questions: “What do we have?” and questions: “What do we have?” and “What else do we need?” (May need “What else do we need?” (May need infrastructure and Superstructure)infrastructure and Superstructure)


• Financial studies: Developers Financial studies: Developers must estimate the project’s cost. must estimate the project’s cost. Also, where are they getting the Also, where are they getting the money they need?money they need?

• Environmental impact studies: Environmental impact studies: Must consider how the Must consider how the development and influx of development and influx of travelers will affect the natural travelers will affect the natural and built environmentsand built environments

VOCABULARY!!!!VOCABULARY!!!!

Please copy down this Please copy down this important interruption:important interruption:

CARRYING CAPACITY: The CARRYING CAPACITY: The amount of living creatures a amount of living creatures a certain piece of land can certain piece of land can accommodate before it starts accommodate before it starts to degrade from over-use.to degrade from over-use.


• Social Impact Studies: Studies of how Social Impact Studies: Studies of how the tourists will impact the local the tourists will impact the local communities. Will the permanent communities. Will the permanent residents resent the commercialization residents resent the commercialization of their home?of their home?

With careful planning, an area can With careful planning, an area can become a tourist destination with become a tourist destination with minimal negative impacts. Or, the minimal negative impacts. Or, the planning process will let you know planning process will let you know development is NOT a good idea.development is NOT a good idea.

Different types of Different types of DevelopmentDevelopment

IntegratedIntegrated: The whole thing shows : The whole thing shows up rapidly, specifically as a tourist up rapidly, specifically as a tourist destination thanks to one single destination thanks to one single developer. It is an isolated distinct developer. It is an isolated distinct location and very costly to create. location and very costly to create. (Example: Disney World)(Example: Disney World)


CatalyticCatalytic: Many developments from : Many developments from separate developers. One centralized separate developers. One centralized development sets up the development sets up the infra/superstructure, creating a infra/superstructure, creating a possibility and need for other possibility and need for other developments. Usually the initial developments. Usually the initial developer runs the show, and sets developer runs the show, and sets standards.standards.

(examples: Whistler, BC; Banff, Alberta)(examples: Whistler, BC; Banff, Alberta)


Coattail:Coattail: Commonly found near Commonly found near existing natural or cultural existing natural or cultural locations. It is basically a free-for-locations. It is basically a free-for-all with no central authority. Many all with no central authority. Many small businesses start up, and small businesses start up, and compete with each other.compete with each other.

(examples: Cavendish, PEI; Halifax (examples: Cavendish, PEI; Halifax Waterfront)Waterfront)

The Role of The Role of GovernmentGovernment

Tourism can be an important source Tourism can be an important source of revenue for all levels government. of revenue for all levels government.

They have, therefore, become very They have, therefore, become very involved in tourism planning, often involved in tourism planning, often awarding donations to businesses awarding donations to businesses and tourist organizations, as well as and tourist organizations, as well as taking on much of the development taking on much of the development themselves.themselves.

Macro-governmentalMacro-governmental

UNWTO: United Nations World UNWTO: United Nations World Tourism Organization.Tourism Organization.

Objectives include improving Objectives include improving people’s access to education and people’s access to education and culture through travel and to raise culture through travel and to raise standards of living in developing standards of living in developing countries by promoting tourism in countries by promoting tourism in those areas.those areas.

National Tourism National Tourism OrganizationsOrganizations

NTOs promote their own countries NTOs promote their own countries as tourist destinations. They vary as tourist destinations. They vary as much as the countries they as much as the countries they reside in.reside in.

Some are independent government Some are independent government ministries while others are pieces ministries while others are pieces of expansive departmental of expansive departmental bureaucracies.bureaucracies.

National Tourism National Tourism OrganizationsOrganizations

Even though they are different, they Even though they are different, they often provide similar functions:often provide similar functions:Promote inbound tourismPromote inbound tourismConduct research into tourismConduct research into tourismDraft development plansDraft development plansLicense and regulate hotels, travel License and regulate hotels, travel

agencies, tour guides, interpreters, etc.agencies, tour guides, interpreters, etc.Train hotel staff, tour guides, Train hotel staff, tour guides,

interpreters, etc.interpreters, etc.Operate resort facilitiesOperate resort facilities

Provincial and Local Provincial and Local Tourism OrganizationsTourism Organizations

Provinces and cities promote Provinces and cities promote tourism for the same reasons as tourism for the same reasons as national organizations: national organizations: $$$$$$

Every province and territory has a Every province and territory has a TOURIST OFFICE to develop and TOURIST OFFICE to develop and distribute promotional literature distribute promotional literature and attract publicity (travel and attract publicity (travel writers, popular media, etc.)writers, popular media, etc.)

Greater Government Greater Government InvolvementInvolvement

Government involvement is Government involvement is generally a positive thing.generally a positive thing.

Governments of developing nations Governments of developing nations may have a better idea of what will may have a better idea of what will help/hurt their people than help/hurt their people than foreigners would.foreigners would.

Product Live Cycle Product Live Cycle TheoryTheory

Every Product (or in this case, tourist Every Product (or in this case, tourist destination) follows a similar path:destination) follows a similar path:

Inception: The product is invented or Inception: The product is invented or the destination is discovered.the destination is discovered.

Growth: Word spreads, hotels, Growth: Word spreads, hotels, restaurants open. Local residents restaurants open. Local residents usually involved, though a well usually involved, though a well thought out plan is usually rare.thought out plan is usually rare.

Product Life Cycle Product Life Cycle TheoryTheory

Maturity: Height of popularity. Local Maturity: Height of popularity. Local residents begin to lose control, big residents begin to lose control, big industries move in.industries move in.

Decline: Oversaturation of tourists, Decline: Oversaturation of tourists, exceeds carrying capacity. Destination exceeds carrying capacity. Destination loses appeal that drew people in in the loses appeal that drew people in in the first place.first place.

Not all destinations go through this in the Not all destinations go through this in the same way, some even avoid decline, like same way, some even avoid decline, like Disney World.Disney World.

Economic ImpactsEconomic Impacts

Regardless of why people travel, we all Regardless of why people travel, we all spend moneyspend money

Tourism Spending in Canada in 2007 Tourism Spending in Canada in 2007 was 70.6 Billion dollars.was 70.6 Billion dollars.

One job in twelve, world wide is a One job in twelve, world wide is a tourism related position. 10.1 % of tourism related position. 10.1 % of Canadian workers.Canadian workers.

Tourism is the worlds largest growth Tourism is the worlds largest growth industry.industry.

Tourism Tourism Dollars/Multiplier EffectDollars/Multiplier Effect

The flow of tourism dollars can get The flow of tourism dollars can get complicated.complicated.

Separated between direct spending Separated between direct spending (Hotel, Rental Cars, restaurants, (Hotel, Rental Cars, restaurants, recreation/entertainment, recreation/entertainment, souveniers/misc) and souveniers/misc) and

indirect spending (each industry needs to indirect spending (each industry needs to pay suppliers and employees who pay for pay suppliers and employees who pay for their own supplies and clothes and rent, their own supplies and clothes and rent, etc).etc).

Tourism Dollars

Hotel Rental Car Restaurant Recreation Souveniers

Suppliers Employees

Farmers Clothing Rent Food

Tourism MultiplierTourism Multiplier

The actual amount that a country’s The actual amount that a country’s economy grows ends up as more than economy grows ends up as more than the initial money spent by the tourist.the initial money spent by the tourist.

The initial spending keeps being spent The initial spending keeps being spent down the line, again and again, down the line, again and again, allowing multiple people to be able to allowing multiple people to be able to benefit from the same dollar.benefit from the same dollar.

An economy isn’t just the amount of An economy isn’t just the amount of dollars, but the flow of those dollars.dollars, but the flow of those dollars.

LeakageLeakage

The economic term for $$$ that flow The economic term for $$$ that flow OUT of the immediate local economy OUT of the immediate local economy because of the multiplier effect.because of the multiplier effect.

Some items tourists purchase have to Some items tourists purchase have to be imported from other areas, causing be imported from other areas, causing $$$ to leave the local economy. $$$ to leave the local economy.

More imports mean greater leakage, More imports mean greater leakage, and therefore less money staying to and therefore less money staying to circulate in the local economy.circulate in the local economy.

Leakage?Leakage?

Where would leakage be a big problem?Where would leakage be a big problem?

Where would it be a minor issue?Where would it be a minor issue?

How could we stop this process and How could we stop this process and benefit local economies more?benefit local economies more?

??

Tourism and the Balance Tourism and the Balance of Paymentsof Payments

Balance of Payments is the Balance of Payments is the difference between their imports difference between their imports and their exports.and their exports.

TOURISM IS AN EXPORT INDUSTRY TOURISM IS AN EXPORT INDUSTRY (you are providing a service or a (you are providing a service or a product to foreign markets for product to foreign markets for foreign dollars. Only difference is foreign dollars. Only difference is that tourism makes people bring that tourism makes people bring their dollars to you)their dollars to you)

Tourism and the Balance Tourism and the Balance of Paymentsof Payments

Canada usually runs a negative balance Canada usually runs a negative balance on its tourism industry. Which means….on its tourism industry. Which means….

We import more than we export.We import more than we export.

Lots of leakageLots of leakage

Where Does the Money Where Does the Money Go?Go?

Imported food for tourismImported food for tourism

Imported goods for tourismImported goods for tourism

Locals get a taste of imported items Locals get a taste of imported items and now want them for themselves, and now want them for themselves, causing more leakage beyond the causing more leakage beyond the tourism sectortourism sector

Other raw materials to support Other raw materials to support influx of touristsinflux of tourists

Where Does the Money Where Does the Money Go?Go?

Foreign investors in tourism Foreign investors in tourism industryindustry

Multinational corporations that Multinational corporations that own tourism superstructureown tourism superstructure

Necessary LeakageNecessary Leakage

PROMOTION! Can’t be avoided if PROMOTION! Can’t be avoided if the area wants to attract more the area wants to attract more tourists.tourists.

Countries and businesses will pay Countries and businesses will pay for advertising in foreign markets for advertising in foreign markets to promote their industry.to promote their industry.

Social ImpactSocial Impact

Success or failure is usually Success or failure is usually measured economically.measured economically.

There has been a growing concern There has been a growing concern for years regarding the social, for years regarding the social, cultural, and physical impacts.cultural, and physical impacts.

Destination development causes Destination development causes social change, both positive and social change, both positive and negative.negative.

Like what?

How could extra money and tourists affect the society of a small mountain town?

Changing employment patterns

Increased incomes

Rising property values

Like what?

RESENTMENT!!!!!!!!Usually a bigger deal in areas

where tourism is the communities main source of income.

What stage of the product life cycle would this happen at?

Cultural Effects

Demonstration Effect: The host community adopts the social and cultural values of visiting tourists

One example: Many westerners travel to east Asia, and many cultures there have a deep love for western (specifically American) culture.

Often times the visitors can adopt the values of the host culture. (Cross-adoption)

Example: North American interest in foreign cuisine.

Good or Bad?Good or Bad?

What do you think? Can this be a bad What do you think? Can this be a bad thing?thing?

Some believe the demonstration effect is Some believe the demonstration effect is eroding traditional cultures, destroying eroding traditional cultures, destroying the reason many people travel.the reason many people travel.

Can you think of any positive aspects of Can you think of any positive aspects of increased contact?increased contact?

Increased contact can create a demand Increased contact can create a demand for indigenous cultural products.for indigenous cultural products.

Physical ImpactsPhysical Impacts

Destination development can affect Destination development can affect the physical environment as well.the physical environment as well.

Problems could include Problems could include environmental destruction, too much environmental destruction, too much stress on existing infrastructure stress on existing infrastructure causing pollution and congestion.causing pollution and congestion.

Can also create and intensify Can also create and intensify conflicts over land use.conflicts over land use.

Physical ImpactsPhysical Impacts

How could destination development HELP How could destination development HELP the local environment?the local environment?

Improvements to local infrastructure (water Improvements to local infrastructure (water supplies, sewage, roads)supplies, sewage, roads)

Conservation efforts have saved Conservation efforts have saved endangered species in order to preserve endangered species in order to preserve the local beauty and attraction of some the local beauty and attraction of some destinationsdestinations

Some developments cause landscaping that Some developments cause landscaping that can help the local environment thrive.can help the local environment thrive.

Deterrants

What can cause people to NOT want to develop a tourist location?

Fear of/current tourist overcrowding Pollution Environmental degradation Political Instability Fluctuating currency Disease epidemics “Terrorism”

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