Marketing Management Essay writing help analysis on Tourism sector: Victoria tourism and challenges -Risks and analysis

Challenges for Victoria as a tourism state:

There is a lot of beauty in the state of Victoria. Thus this beauty creates a very large scope of development for the tourism in the state. This has been understood by the Australian governments and there have been a lot of steps that have been undertaken to make sure that there is development of the same in the state. However there are certain issues that the tourism development in the state faces. These issues have a long term impact on the growth potential of the organization. And these issues have been discussed below:

Global Financial Crisis:

As per Andrew(2005) the global financial crisis can be taken as one of the risks that could affect the Victorian Tourism in the coming next ten years. Almost all the industries are vulnerable to economic slowdown but there is a larger impact on Tourism industry this is so because travelling involves discretionary expenditure but during the financial crisis globally people tend to preserve their cash for the basic utilities of life, for food and shelter and other family necessities. Also to mention that this does not means that the tourism would stop. This refers to the fact that the pace of the tourism industry reduces. Due to the global financial crisis the customer uncertainty has increased to a much larger extent as a result the tourism industry is facing the consequences of decreased spending both by the individual customers and also the corporate customers. The shriveling capital market also has impacted the tourism industry as a result of which the sales of the businesses have declined. The sales mentioned include the sales related to lodging, sales related to food service and the sales related to other hospitality products and events. There has also been a reduction in the average expenditure of the guests .Thus the overall decline in confidence has sent in a negative message which will have sturdy impact majorly on the terms of investments in the tourism industry .Another of the affect of this economic slowdown could be that the Victorian tourism have to attend the travelers or the customers on the tighter budgets so as to do well and also to reduce the ill impact of the economic slowdown on its business.

The best way out of the crisis is to cut costs. The organization should try to maintain a healthy structure that does not have any excess costs that are dragging down the profit figures. There should be an added responsibility on each and every member of the organization regarding the use of the resources that the organization has and the way that they shall be utilized should be completely thought out and should not allow for wastage of such resources.

Stagnant Domestic Tourism Sector:

As perAustralian Standard (1999)  the stagnant domestic tourism sector is taken as a long term risk because as per the national data of domestic tourism reveals that there has been an increasing decline in the local people visiting the tourists places and thus is investing less in the domestic leisure travel. Due to this there is shrinking capital market and also a decline in revenues as the local people themselves are not favoring there tourists destinations. There can be a variety of reasons which can be responsible for the stagnant domestic tourism such as increased competition from the overseas tourists destinations another of the reason could be that the consumer patterns related to spending are changing at a very high pace like for instance the same consumer is taking less trips , spending a few amount or only few nights at the domestic tourist places and thus reducing the overall expenditure on the domestic trip and the same consumer is spending reasonably high at other places thus leading to change in consumer patterns regarding expenditure. Another of the reason for increased stagnancy in domestic tourism could be the growth of the low cost airlines.  As the low cost airlines are increasing in the market place, people are carrying the mentality that with spending a little more as compared to the expenditure in the domestic tourism they could go overseas and visit a new land which they have not yet explored and this could become a much more adventurous experience for them. Thus all of the above mentioned factors are imposing threat towards the domestic tourism which in itself is topic to be bothered about because once the situation goes out of hand then it would become really impossible to get it back to the track.

This can be outlasted by either the changes that shall happen on their own in the economy of the world which includes the global recession which has left many a people with less funds. Or the second manner can be the increase in the awareness among the members of the society regarding various things which include the environmental impact of air travel and something’s similar which can make the local residents think that a local holiday is more beneficial to them rather than an international one.

Rise of new technology and media fragmentation:

As per Tourism Victoria the rise of new technology and media fragmentation is also amongst one of the current challenges that the tourism in Victoria is facing. This is so because as the technology is becoming advanced with every passing hour the consumers have got more and more access towards the information regarding tourism and have become more knowledgeable regarding the destination which they want to choose or getting the booking done for their travel purposes. Also there is huge variety of blogs related to travel and tourism and the best places to visit giving ample of information t the customers so that they can decide where to go and where not to go. Also there user generated sites which is another mode of information gathering source because of which the consumers have a good amount of knowledge regarding variety of tourists destinations. These sites also provide the consumers to seek advice from a wide range of sources who are experienced enough and thus reaching to any conclusion or taking any further decision regarding visiting a tourists place. Thus because of all these factors or we can say because of all these information the consumer have become much more aware of the real value for the money which he is putting toward his leisure travel . Thus we can say that the rise of new technology has its own benefits and disadvantages, benefits on the side of the consumers as they can gather a lot of useful information in very small time and thus can decide upon it with the help of some expert opinion but for the tourism in Victoria this is a disadvantage as it is losing its customers to the overseas market thus reducing its share of revenue

As per Dimitrov(2003) the only way out for Tourism Victoria from such a scenario is to keep on upgrading themselves with the change in the technology and then create an environment for facilitating this change and then working accordingly to map a marketing plan which allows the organization to keep away from negative comments. This can be done by creating a website that leads the prospective client to the company website when he searches for it with some key words and not to a blog which has negative comments about the place. Thus there has to be a constant change with the changing environment.

Increase in outbound travel:

As per Tourism Victoria there has been a continuous increase in the spending of the Australian public in outbound travel into other countries in the worlds. Although this shows the increasing prosperity of the nation but it means that there is less inflow of tourist in the state of Victoria. The people in the country have started to go out to other nations because of a few reasons. The first is the fact that foreign travel is considered as more prestigious and this is also considered as an important part in the social cycle. Secondly there has been an increase in the value of the Australian dollar and this has resulted in cheaper holidays outside of Australia. Thirdly increases in the capacity in airlines for more passengers has increased the amount of outbound passengers and the holiday deals which have become cheaper due to the same there has been an increase in the outbound travel and have made holidays in general cheaper. There are other reasons for the increase in the outbound travel as there has been a decrease in the cost of the travel in other countries as well as they have tried to increase the inbound travel for them.

However, this trend may change with the recent dollar devaluation, which will then reduce the amount of travelers that are trying to go to outside destinations. As this shall increase the cost of the travel and thus this shall make outbound travel expensive and there shall be a decrease in the travelers. Lastly as there can be some kind of increase in the type of entertainment that the travelers look in outside that can be provided in the domestic travel which can then help reduce the number of people that are going on outbound travel.

Climate change:

As per Tourism Victoria the last risk that can be termed as one of the most important one among them all. There has been a lot of talk among people all across the globe reading the change that has happened in the climate and how this can be affecting the globe all around. The one place where sucha thing can have far reaching consequences is the tourism industry in any place. There has been a drastic change in the weather of the Victorian state in the past few years and this has affected the influx of the tourists to the place as well. Another factor that has to be taken into consideration is the fact that there have been fewer amounts of people who come to the state from other countries. This is due to the fact that there has been an increased awareness about the amount of pollution that air travel does and the amount of resources that it requires and hence people as they become more aware shall travel less and less so as to save on the planets resources.

As per Dimitrov (2006) the major mitigation for this risk is that the tourism industry in general shall have to look into more eco-friendly ways of attracting tourists to their place. As by doing this they shall be benefitting the environment but they shall have to look at their own sustenance and understand that there has to be certain new ways that they shall have to utilize to make sure that there is a way that makes sure that the tourists do not think that coming into Victoria shall be a loss for the environment and should feel that they are not leeching on the resources of the plant.

About Tourism Victoria:

The organization is a tourism development vehicle that has been put into place by the Australian government. This vehicle has been put into placed to make sure that there is a constant development of tourism in the state of Victoria. The vehicle participates in all the activities that can allow the state to develop the tourism activities that are prevalent in the area. The vehicle has had considerable success in the past and this has fueled high expectations for the future of the organization.

The primary stakeholder in the organization, the Australian government established the organization under the Tourism Victoria Act and this has resulted in the Australian government being the primary stakeholder in the organization. This allows the organization to utilize the funds available to them and create a successful tourism environment for the Australian state of Victoria.

A few more stakeholders in the organization include the local authorities and the local population of the state who have the right to express their pleasure or displeasure on the workings of the state as they shall have to be responsible for any major developments that the organization does in tourism as this can affect the day to day workings of these stakeholders. The local authorities may include the police, the state authorities and the various committees for state development.

However in spite of such a large number or resources at hand the organization does face a lot of challenges. Some of the challenges that Tourism Victoria faces and can face in the future have been discussed below.

Internal Risks:

Service standards:

As per Lyons (2005) the first internal risk that the organization faces is the fact that there can be a lack of proper service standards in the various hotels or other place where the tourists tend to go. And a thing like this can be very negative for a customer oriented industry like tourism. There has to be a certain standard that the organization should promote and thus create a positive image in the minds of the tourists that visit the place.

Complacency:

As per As per Lyons (2005) the second internal risk that the organization faces is complacency, as the organization had a lot of support in the past from the Australian government and hence they never had to worry about the funds and the usage of the other resources and thus this can create a sense of complacency in the organization as they do not have to fight for their resources and this is another internal risk.

Support systems failure:

As per Tourism Victoria another internal risk can be the failure of one or more support systems in the organization which can include anything ranging from an IT issues to a sudden change in the management of the organization which may force changes that the people related to the organization may not be completely agreeable with.

External Risks:

There are a lot of external risks that the organization faces in the current scenario. The risks that the organization faces include the following.

Lack of road signs:

As per Tourism Victoria the first risk that has to be included here is the fact that there is a lack of proper road signs in many places in Victoria. This can be a deterrent to many visitors as well as tour operators. The reason being that many tour operators use the road signs available to direct their customers to many places to see in the state. And if there is a lack of proper sings then there can be a problem for both the tour operators and the customers. Thus this kind of risk which is there due to the lack of initiative from the local authorities is an external risk that the organization faces in the past and the future.

Competition:

As per Tourism Victoria another external risk that exists for the organization is the increasing competition from destinations from all across the globe. As there is an increase in globalization more and more information is being shared on a day to day basis as this happens more local holiday goers come to terms with the various new destinations that are available to them and where they can go for a same or sometimes even cheaper rates. Thus this makes them think that if they can afford an international holiday at the same rates as a national one then they would prefer to go to some destination which is outside the country. And thus this kind of risk is another external risk that exists and has been there since a long time.

Natural disasters:

As perNorsokStandard(1998) a last major external risk that the organization faces is the risk of increased environmental disasters. With many events that are affecting the environment there are increased chances that there can be natural disasters that may occur and which may change the face of the tourism sector in the state. There has been an increased chance of a natural disaster due to the environmental changes and thus Tourism Victoria has to prepare for such an occurrence.

Long Range Analysis:

As per Dimitrov, (2006)therehave been a lot of issues that have facilitated the policies and the way that the business for tourism Victoria has been facilitated and improved.

The first and foremost business condition is the changes in the other destinations ways of promoting their own products. This has forced tourism Victoria to change their own ways and means of developing their business and the changes in the local infrastructure.

The second business condition that has facilitated the past decisions and that can be a major occurrence in the future as well for the organization is the branding of the organization. The organization has to be promoted as a family and a business destination. There should also be focus on the adventure sports or other activities that can attract the purists of adventure travel. By doing this the organization can have a much better result and perspective regarding the future of the organization.

The third business condition is the changes in the ways air travel is being undertaken today. In the past air travel was expensive and there were a few tourists from outside the state that used to come to the place. Now with the increased number of airlines and the comparative less amount of expenses on air travel there has been an increase in the number of tourists. This has to be taken into consideration as the policy makers that are formulating the policies have to have a knowhow of the number of estimated tourists so that they can have clearer direction for the policies and the organization.

The last business condition that has had a major impact on the policies and the functioning of the organization is the infrastructure development that has been undertaken by the local authorities as well as the government. With the continuous development in the infrastructure there has to be continuous changes in the policies of the organization as well.

Thus it can be said that although there is not a lot major forces at work in the business environment for the organization in the current scenario there is scope for major changes in the future.

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