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The economic threat to the travel and tourism industry

Written by editor

When historians of modern tourism write about tourism in the first decade of the twenty-first century they will most likely see it as one of continual trials and challenges.

When historians of modern tourism write about tourism in the first decade of the twenty-first century they will most likely see it as one of continual trials and challenges. The terrorism attacks on September 11, 2001 forced the travel and tourism industry to face global security threats and to determine how this new reality would change the way the tourism industry would do business. Certainly anyone who has traveled since 9-11 is well aware that travel is not the same as it once was. In some ways the tourism and travel industry did an excellent job in responding to this new threat; in other ways it is still in quandary as to how to handle global terrorism. Following on the heals of September 11, travel and tourism has had to face issues of food safety, health crises, natural disasters, and the rapid rise in petroleum prices resulting in major price increases for both land and air transportation.

Now toward the latter part of this decade, the tourism industry must once again face a very different type of threat. While this threat is neither physical nor medical, potentially it may be just as or even more dangerous than the others. That threat is the current economic meltdown and what it means to world tourism and travel. While it is still too early to predict exactly how this current economic crisis will impact the tourism industry some clear trends and ideas are already emerging. To help you think about the impact of these economic turbulent times on travel and tourism, Tourism & More offers the following insights and suggestions.

-Be realistic; neither panic nor have a sense of false security. There is no doubt that tourism, especially the leisure side of the industry, may be in for some proverbial stormy seas. However, in every crisis, there is the chance for new and innovative ideas to emerge, new directions to be taken, and new alliances to be forged. The bottom line is that the travel and tourism industry is not going away and your business is not going to fold tomorrow. Take a deep breath, think about which challenges each component in your locale’s tourism and travel industry may be facing, and what are some possible solutions that will permit you to overcome these challenges. Remember the best way to solve big problems is by breaking them down into smaller and more manageable problems.

-Be up and be positive. This challenge is not the first nor will it be the last that the travel and tourism industry is going to have to face. Your attitude impacts everyone with whom you work and/or serve. When leaders demonstrate positive and cheerful attitudes, creative juices start flowing. Difficult economic times demand good leadership, and the basis of good leadership is believing in yourself and in your product. No matter what the media may be saying, walk into your office with a smile on your face.

-Do not let the media get you down. Remember that much of the media thrives on bad news. Learn to separate facts from “analytical fictions.” Just because a commentator states something does not mean that it is true. News media are hampered by their need to provide 24-hour news coverage, and thus must constantly seek new ways to attract our attention. Remember the media thrives on bad news. Know how to separate facts from opinion and truth from media hype.

-Think spiritually. When times are tough many people turn to some form of spirituality. Spiritual tourism tends to boom during difficult political or economic times. While many houses of worship may be the foundation for spiritual tourism, spiritual tourism is much more than merely visiting a church or synagogue. Think beyond your houses of worship to the underlying sense of spirit within your community. This may be the time to encourage people to visit cemeteries where loved ones are buried, or develop inspirational trails. Places where historical events may also become part of your spiritual tourism offering.

-Assess both your tourism and economic strengths and weaknesses. Know where your proverbial Achilles heals may be. If the economy should worsen considerably which groups of travelers may you lose? Is there a new group of travelers to whom you have never marketed? Is your business, hotel, or CVB carrying too much debt? Is this the best time to ask for salary raises or to seek credit for a building? Remember the media reports on world and national conditions, but what often counts are local conditions. Assess your goals, needs and problems in light of your local conditions and the economic conditions at your principle customer sources.

-Remember that travel and tourism are component industries. That means that your business will be impacted by everyone else’s business. For example, if your community loses restaurants then that loss will impact the number of people staying in town and may hurt local hotels. If hotels are not occupied not only will lodging tax revenues decrease but also this decrease will impact a wide variety of business owners. Tourism and travel will need to practice collective survival. The power of clustering to increase business will become an important trend

-Develop an economic security team. This is the time not to pretend to know everything. Call upon as many experts as possible to develop new ideas and to monitor the situation. Most communities have economically savvy people. Bring local bankers, business leaders, hoteliers, and attractions owners together for a local summit and then follow up this summit with a schedule of regular meetings. Remember this crisis will most likely be fluid with multiple economic ups and downs.

-Think out-of-the-box. Crises are the time to try to figure out ways to do more with less. Consider ways to connect your product development to/with your marketing. In turbulent economic times the public seeks substance of glitz. Make sure that you provide tourism essentials such as a tourism oriented policing unit and good customer service. Beautification projects not only add value to your tourism product but also provide an uplifting environment that allows for creative problem solving and encourages business-people who must face a myriad of problems to want to return to your locale.

Economist and finance specialists are not always right. To paraphrase an old adage, the “road to bankruptcy is paved with the opinions economists and people in finance. Listen to the best advice, but at the same rime never forget that economists make numerous mistakes. Neither finance nor economics is an exact science. Instead listen to expert opinions but never forget that in the end, the final decision is yours. So once you have done your research listen to your gut. That may be the best advice of all.
___________________________________________________________________The current economic slowdown may be one of the tourism industry’s greatest challenges in recent history. To help your travel and tourism industry ride out the storm, Tourism & More offers the following:

Two Brand New Lectures:
1) Smoothing out rocky economic roads: What tourism needs to do stay in front of these economically challenging times!

2) Surviving Economically Challenging Times: Best Practice from Far and Wide.

3) Our trained staff of professionals is ready to meet with you to discuss specific strategic planning for your locale during this most difficult of times.

Dr. Peter E. Tarlow is the President of T&M, a founder of the Texas chapter of TTRA and a popular author and speaker on tourism. Tarlow is a specialist in the areas of sociology of tourism, economic development, tourism safety and security. Tarlow speaks at governors’ and state conferences on tourism and conducts seminars throughout the world and for numerous agencies and universities. To contact Tarlow, send email to [email protected]