MGBBT1TEN Tourism Business Environment And Industry Assignment Sample

Exploring the Tourism Business Environment and Industry: Assignment Focus

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Introduction OF Tourism Business Environment And Industry

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  • The travel and tourism sector is a rapidly expanding industry, with 1.5 billion international visitor arrivals in 2019, up from 674 million in 2000.
  • In 2020, the COVID-19 pandemic had a severe impact on the industry, resulting in a significant failure in global travel and tourism.
  • Despite this setback, the industry is anticipated to recover, and new travel and tourism-shaping trends are emerging (Calderwood and Soshkin, 2019).
  • These emerging global trends include ecotourism, digitalization, and authentic experiences.
  • These trends are significant for tourism development decision-making because they can attract environmentally conscious tourists and improve the customer experience and efficiency.
  • Changes in global trends can have an impact on the global attractiveness of businesses in the tourism business, and businesses must weigh the costs and benefits of these factors carefully when making decisions.
  • Consideration must also be given to the costs and benefits of these trends on the economy, society, and situation, such as the potential for job creation and positive effects on local cultures and traditions.

Note: In order to remain competitive, businesses must adopt sustainable tourism practices, digitalisations provide authentic experiences, and invest in research and development. Overall, the travel and tourism industry is in a perpetual state of change, and businesses must adapt to succeed in the future.

Emerging Global Trends in the 21st Century Travel and Tourism Industry

  • Sustainable tourism is the promotion of tourism activities that have a slight impact on the atmosphere and the local community.
  • Travellers are becoming more conscientious of their environmental impact and are pursuing travel experiences that align with their values. As a result, the demand for sustainable tourism has increased, and businesses are modifying their practises to meet it (Gustavo, 2015).
  • International tourism organizations have placed legal and environmental pressures on the tourism industry to ensure that tourism activities are conducted in a sustainable and responsible manner. These pressures have led to the development of various sustainability standards, certification programs, and campaigns to promote responsible tourism practices.
  • Digitalization has changed the way people travel and consume tourism products and services. The use of mobile applications, social media, and online booking platforms has increased the availability and convenience of travel.
  • Online, travellers can readily access destination information, compare prices, and book trips. Additionally, digitalization has enabled businesses to customise their offerings, improve the consumer experience, and streamline their operations.
  • This trend is significant because digitalization has become indispensable in the tourism industry, and businesses that fail to implement technology risk losing their competitive advantage.
  • Travellers are looking for authentic experiences that immerse them in the local culture and traditions. This trend has led to the expansion of place travel products, such as cultural and gastronomic tourism, where travellers can interact with local communities and gain insight into their way of life (Timothy and Boyd, 2016).

Note: This trend is significant because it aligns with the Sustainable Development Areas of the United Nations, and businesses that implement sustainable tourism practises which can attract environmentally conscious tourists and boost their brand reputation.

Importance of these Trends in Tourism Development Decision Making

  • Sustainable tourism is consistent with the Sustainable Development areas of the United Nations, which seek to encourage sustainable economic growth, reduce poverty, and protect the environment. Businesses that implement sustainable tourism practises can attract eco-conscious tourists and enhance their brand reputation (Bailey and Richardson, 2020).
  • Authentic experiences can serve as a unique selling feature for tourism products and services, as well as provide travellers with unforgettable experiences.
  • Businesses that offer authentic experiences are able to differentiate themselves from competitors and attract travellers in search of meaningful and distinctive travel experiences (Giaoutzi and Nijkamp, 2017).

Note: Businesses that employ sustainable tourism practices, embrace digitalization, and provide authentic experiences can attract customers, set themselves apart from rivals, and contribute to the industry's sustainable development.

How would it help the stakeholders and tourism businesses going forward during the tough economic downturn?

  • The support of shifting trends towards sustainable tourism practises can help stakeholders and tourist businesses accomplish their long-term goals, particularly during difficult economic downturns. By applying sustainable practices, businesses in the tourism sector can enhance their reputation, reduce costs, and limit their adverse effects on the environment.
  • Stakeholders have adopted a number of strategies to advance sustainable tourism practises in response to external factors such increasing demand from international bodies and changing client needs.
  • One strategy utilised by tourism businesses to create new products with an emphasis on sustainability and environmental friendliness is product innovation. For instance, hotels and resorts may adopt eco-friendly technologies like solar electricity or energy-efficient lighting to reduce their carbon footprint.
  • Travel agencies may offer eco-friendly vacation packages that promote environmental preservation and intercultural understanding in a similar spirit.
  • Another strategy is to innovate with technology in systems and procedures. For instance, companies in the tourism industry may invest in digital tools to improve supply chain and waste management.

Note: These conditions can result in higher operating costs and lower investment funding for sustainability initiatives. In order to lessen these risks, businesses in the tourism sector may use cost-cutting measures like energy efficiency and waste reduction in addition to looking for financing options that prioritise sustainability, such green bonds or sustainable financing programmes.

The Variations in Global Trends Affect the Global Competitiveness of Tourism Industry Businesses?

  • Global tourism sector changes can have a big impact on how competitive a business is. In response to the rising demand for eco-friendly travel options, numerous companies’ recently implemented sustainable tourism practises (Liasidou, 2016).
  • Due to this, there has been an increase in eco-tourism, a type of sustainable tourism that places an emphasis on adopting responsible travel habits including protecting the environment, reducing waste, and aiding local people.
  • Digitalization is another development that is transforming the travel and tourism sector. With the development of technology, travellers today anticipate flawless online interactions, such as making reservations for lodgings and activities on web sites (Hong, 2019).
  • Businesses that adopt digitalization can improve customer satisfaction, streamline processes, and boost productivity, which boosts competitiveness. Additionally, companies that use technology to gather information on customer behaviour and preferences can learn how to better focus their marketing initiatives, resulting in increased conversion rates and earnings.
  • Businesses that provide genuine experiences, like homestays or cultural excursions, can set themselves apart from rivals and draw in a specific type of traveller (Dwyeral 2019).
  • This may result in augmented client retention and repeat commercial as well as favourable word-of-mouth referrals, all of which can improve a company's competitiveness.

Note: Businesses can position themselves for long-term success in the rapidly evolving tourist industry by embracing sustainable tourism practices, digitalisation, and authentic experiences.

What are the economic, social, and environmental costs and advantages of these factors?

1. Tourism Sustainability Practices


  • Economic: Implementing sustainable tourism practices can contribute to the local economy through job creation and increased revenue. For example, a study conducted by the United Nations Environment Programme found that ecotourism generates three times more economic benefits than traditional tourism (Rodriguez?Melo and Mansouri, 2021).
  • Social: Sustainable tourism practices can promote social welfare by creating opportunities for local communities to participate in tourism activities, preserving cultural heritage, and supporting social development projects.
  • Environmental: Sustainable tourism practices can minimize the negative impact of tourism on the environment, protecting natural resources, reducing pollution, and conserving biodiversity.


  • Economic: Implementing sustainable tourism practices can be costly for businesses, requiring significant investments in renewable energy solutions and waste reduction measures.
  • Social: Sustainable tourism practices may require changes to the way local communities interact with tourists, which can create resistance and lead to conflicts.
  • Environmental: Sustainable tourism practices require careful planning and monitoring to ensure that they do not harm the environment.

Example of a sustainable destination: Costa Rica. Costa Rica is known for its sustainable tourism practices, including its use of renewable energy, reforestation efforts, and support for local communities. In 2019, tourism contributed to 8.2% of Costa Rica's GDP, with ecotourism being a significant driver of growth.

2. Digitalization


  • Economic: Digitalization can boost productivity, reduce costs, and increase revenue by improving the customer experience and providing personalized services. For example, the use of mobile apps can enhance the booking process and provide tourists with real-time information about local attractions (Frederiks al 2015).
  • Social: Digitalization can improve access to information and promote inclusivity by providing tourists with information about accessibility and other amenities.
  • Environmental: Digitalization can help reduce the carbon footprint of tourism by reducing the need for paper and other physical materials.


  • Economic: Digitalization requires businesses to invest in new technology and training, which can be expensive.
  • Social: Digitalization can create a digital divide, with some tourists having limited access to digital platforms.
  • Environmental: Digitalization can increase the energy consumption of tourism businesses, especially if they rely on data centers and other energy-intensive technologies.

Example of a sustainable destination: Amsterdam, Netherlands. Amsterdam has implemented several digital initiatives to promote sustainable tourism, including the use of a digital platform that provides tourists with information about sustainable transportation options and environmentally friendly hotels.

3. Original Experiences


  • Economic: Providing authentic experiences can attract tourists who are willing to pay more for unique and immersive experiences, increasing revenue for tourism businesses.
  • Social: Authentic experiences can promote the preservation of cultural heritage, support local communities, and provide opportunities for tourists to interact with locals.
  • Environmental: Providing authentic experiences can encourage tourists to engage in sustainable tourism practices, such as responsible wildlife viewing and conservation efforts.


  • Economic: Providing authentic experiences can require significant investments in research and development and may be cost-prohibitive for some businesses.
  • Social: Providing authentic experiences can be challenging if there is a lack of understanding or respect for local cultures and traditions.
  • Environmental: Providing authentic experiences can have negative impacts on the environment if not carefully planned and managed.

Example of a sustainable destination: Bhutan. Bhutan has implemented a "high-value, low-impact" tourism policy that prioritizes sustainable tourism practices and authentic experiences that promote the country's unique culture and traditions (Aronson 2017).

4. Meeting changing consumer preferences


  • Economic: Meeting changing consumer preferences can help tourism businesses stay competitive and increase revenue (Ekins and Zenghelis, 2021).
  • Social: Meeting changing consumer preferences can promote social welfare by responding to tourists' desire for responsible and sustainable tourism practices.
  • Environmental: Meeting changing consumer preferences can encourage tourism businesses to implement sustainable tourism practices that minimize negative impacts on the environment, such as reducing carbon emissions, conserving natural resources, and promoting conservation efforts.


  • Economic: Meeting changing consumer preferences can be costly for tourism businesses as it may require significant investments in research and development, marketing, and infrastructure. For example, sustainable tourism practices may require expensive upgrades to facilities and investments in renewable energy solutions.
  • Social: Meeting changing consumer preferences can also be challenging for local communities and businesses that may not be prepared to meet changing demands. It can also lead to over-tourism and negative impacts on local cultures and traditions if not managed properly.
  • Environmental: Meeting changing consumer preferences can also have negative environmental impacts if not implemented sustainably. For example, if the trend for eco-tourism leads to increased demand for activities like wildlife viewing, it may lead to habitat destruction or exploitation of wildlife if not regulated properly.

Note: Examples of sustainable destinations:

  • Costa Rica has become a sustainable tourism leader, with 25% of its land dedicated to protected areas and a focus on eco-tourism and sustainable tourism practices.
  • The Maldives has implemented sustainable tourism practices, including a commitment to carbon neutrality by 2023 and a ban on single-use plastics.


The following prospective recommendations are made based on the findings:

  • Businesses should employ sustainable tourism practises in order to reduce their carbon footprint and protect natural resources. This can entice environmentally conscious, willing-to-pay-a-premium tourists.
  • Businesses should embrace digitalization in order to improve the consumer experience, streamline operations, and generate new revenue streams. This can create jobs and improve operational efficacy, which can have a positive effect on the economy (Drews and Van den Bergh, 2016).
  • Businesses should offer authentic experiences in order to distinguish themselves from competitors and establish a unique selling point for their products and services. This can aid in the preservation of indigenous cultures and traditions.
  • Invest in research and development Businesses should invest in research and development to remain ahead of emerging tourism industry trends and technologies. This can assist companies in remaining competitive and attracting new customers.

Note: Overall, the tourism industry is in a perpetual state of change, and businesses must adapt to remain competitive. Businesses can position themselves for future success by embracing sustainable tourism practices, digitalization, offering authentic experiences, and investing in research and development.


  • Aronson, M.F., Lepczyk, C.A., Evans, K.L., Goddard, M.A., Lerman, S.B., MacIvor, J.S., Nilon, C.H. and Vargo, T., 2017. Biodiversity in the city: key challenges for urban green space management.Frontiers in Ecology and the Environment,15(4), pp.189-196.
  • Bailey, E. and Richardson, R., 2020. A new economic framework for tourism decision making.Tourism and Hospitality Research,10(4), pp.367-376.
  • Calderwood, L.U. and Soshkin, M., 2019, September. The travel and tourism competitiveness report 2019. World Economic Forum.
  • Drews, S. and Van den Bergh, J.C., 2016. What explains public support for climate policies? A review of empirical and experimental studies.Climate policy,16(7), pp.855-876.
  • Dwyer, L., Edwards, D., Mistilis, N., Roman, C. and Scott, N., 2019. Destination and enterprise management for a tourism future.Tourism management,30(1), pp.63-74.
  • Ekins, P. and Zenghelis, D., 2021. The costs and benefits of environmental sustainability.Sustainability Science,16, pp.949-965.
  • Frederiks, E.R., Stenner, K. and Hobman, E.V., 2015. Household energy use: Applying behavioural economics to understand consumer decision-making and behaviour.Renewable and Sustainable Energy Reviews,41, pp.1385-1394.
  • Giaoutzi, M. and Nijkamp, P., 2017.Emerging trends in tourism development in an open world.Tourism and Regional Development, pp.1-12.
  • Gustavo, N., 2015. Marketing management trends in tourism and hospitality industry: facing the 21st century environment.International Journal of Marketing Studies,5(3), p.13.
  • Hong, W.C., 2019. Global competitiveness measurement for the tourism sector.Current issues in tourism,12(2), pp.105-132.
  • Liasidou, S., 2016. Decision-making for tourism destinations: Airline strategy influences.Tourism geographies,15(3), pp.511-528.
  • Rodriguez?Melo, A. and Mansouri, S.A., 2021. Stakeholder engagement: Defining strategic advantage for sustainable construction.Business Strategy and the Environment,20(8), pp.539-552.
  • Timothy, D.J. and Boyd, S.W., 2016. Heritage tourism in the 21st century: Valued traditions and new perspectives.Journal of heritage tourism,1(1), pp.1-16.
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