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Enriching Knowledge for the SS
Tourism and Hospitality Studies
Series: Introduction to Tourism
Contents
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Sectors of tourism industry
Distribution Channels of Tourism Products
Impacts of tourism
Changes in tourism industry under the COVID-19 pandemic
Future development in tourism industry
Sectors of tourism industry
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The Public Sector
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Government :
Government departments and some public tourism organizations, such as Tourism Commission established in May 1999 and is under the Commerce and Economic Development Bureau
1. map out Government's tourism development policy and strategy 2. provide a focal point for liaison with the tourism industry
3. enhance co-ordination in developing tourism
Tourism Organizations:
Under government funded such as Hong Kong Tourism Board 1. promote Hong Kong as a travel destination worldwide
2. enhance visitors' experience once they arrive
Major role of Public Sector
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Planning and facilitating tourism, devise policies and plans for
development, Include the generation of guidelines and objectives for the growth and management of tourism, both in short and long term
Control and supervision of tourism:
Controlling and supervising tourism
Prevent undesirable growth
Maintain quality standard
Help match supply and demand
Protect tourists against industrial malpractice of failure
Major role of Public Sector
(con’t)
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Direct Ownership of Components of the Tourism Industry, governments own parks, museums,
historic sites, streets and highways railways to
facilitate the development of the tourism industry
Promoting Tourism to Home and Overseas
Markets, produces and distributes maps, charts, and tourism literature, increase tourism growth by effective marketing
Investment Support, provision of land by the government at less than market value and low interest rate
Active Involvement, Legislation which is conducive
to foreign investment
Private Sector
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Produces goods and provides service to consumers and earn profits
Majority of tourism organizations are owned and operated in the private sector
Primary purpose is to profit and pay the owners or shareholders who invested their money
Accommodation
Food and Beverage
Transportation
Accommodation
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Accommodation
1. Provided place, lodging or rooms to tourists to stay
2. The hotel leader in the world: Marriott international, inc, manage,
franchise, own, and develop Marriott-brand hotels: 30 brands, around 7,650 properties, 1.42 million rooms, 131 countries
3. Some factors affecting tourists from choosing accommodation
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Price Location Comfort
Service Brand Star Rating
Accommodation
10 Away from home composes of three main elements:
Satisfactory accommodation
Safe transportation
Suitable entertainment
Accommodation is the temporary home for travelers 1. Hotels
2. Motels (motor hotels) 3. Resort hotels
4. Campgrounds, 5. Hostels
6. Guesthouses.
Five Dimensions Weight
Facilities 0.25
Location 0.20
Staff to Room Ratio 0.20
Achieved Room Rate 0.20
Business Mix 0.15
Overall 1.00
Hotel Category Composite Score High Tariff A Hotels 3.00 or above to 3.99 High Tariff B Hotels 2.00 or above to 2.99 Medium Tariff Hotels 1.00 or above to 1.99 Tourist Guesthouses – self explanatory –
Hotel Rating System in Hong Kong
Accommodations and Target
Segments
11 Target market is a group of people who have similar wants and needs
Similar demographics like median age, race, or income level
Specific type of people or groups who are the most efficient or potential customers
Leverage the targeting in product, sales, and marketing strategies
Every hotel must align their marketing and sales efforts if they want to attract and book more of these ideal
guests
Historical sales data is great hints to know target audience profiles and preferences
What Is a Resort?
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What is the difference between a resort and a hotel?
A hotel is a place that provides lodgings, or sleeping
accommodations, to its patrons. Hotels may or may not provide meals and other services for travellers and other paying guests as well.
A resort is a space, similar to a hotel, that offers relaxation and
recreation to its patrons. Resorts will always offer accommodations as well, in which case people might refer to such locations as a
“resort hotel.” Basically, the resort meaning is that of a hotel, but just with more accommodations, amenities, and activities, providing a wide variety of recreational facilities/programs.
Characteristics of Resort Management
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There are several features that distinguish resort properties from other types of lodging properties
Guests
Recreation
Location
Local dependence
Seasonality
Personnel
Employee training
Revenue and accounting
Traditions
Target Guests
Vacationing individuals Vacationing families
Convention guests
Higher expectation and demanding
Stay longer than typical commercial hotel guests
Rooms are typically more expensive
Any resort hotel in
Hong Kong?
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Auberge Discovery Bay Hong Kong Disney Explorers Lodge
Disney's Hollywood Hotel
Hong Kong Disneyland Hotel Hong Kong Gold Coast hotel
Hong Kong Ocean Park Marriott Hotel
Other type of Loggings
1. A Guesthouse is a form of accommodation that is
sometimes being called the simple lodging with basic services
2. Motel, also called Motor Lodge, Motor Court, Tourist Court, or Motor Inn,
originally a hotel designed for persons travelling by automobile, with
convenient parking space provided
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Food and Beverage
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Specialty Restaurant
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Deal in a particular type of cuisine like Chinese, Italian or French etc
Each aspect of the restaurant is typical and related to the area of region of community whose food is being served
Guest can feel the specific country culture and tradition of that area while dining in restaurant
Restaurants may be attached to resort or may independently exist
Specific hours of function and normally more expensive than ordinary restaurants
Room Service
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Room Service is attached to a hotel and caters to the F & B requirements of the guests who are staying in the hotel only
Room service operates round the clock in resort and 5 stars hotel
Prices in the room service are
generally higher than outlets
Transportation
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MODE CARRYING AND
CAPACITY ADVANTAGES DISADVANTAGES SIGNIFICANCE FOR TOURISM
Air
• Aircraft• Medium to High capacity
• Speed
• Suited to long distance 1. High fuel consumption 2. Stringent safety
1. Reduced the time of travel 2. Increased accessibility to places 3. Stimulate the growth of
international mass tourism
Water
• Ship/cruise• Medium to High capacity
• Relaxation
• Suited to long or short distance
1. Comparatively 2. High labour costsSlow
Cruising becomes a popular travel transportation, particularly in Europe and USA
Road
• Car, bus, or coach• Low capacity
• Flexibility
• Suited to short distance 1. Possible
congestion 1. Door-to-door flexibility allows tourist to plan routes
2. Mass transport network for excursions
Rail
High capacity • Convenience: arrives at anddepart from central district 1. High fixed costs 1. Special carriages can be added
2. Trans-continental routes and scenic lines
Airline Companies
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Airline Airline (in
Chinese) IATA Callsign Commenced
Operations
Hong Kong
Airlines 香港航空 HX BAUHINIA 2006
Cathay Pacific 國泰航空公
司 CX CATHAY 1946
HK Express 香港快運航
空 UO HONGKONG
SHUTTLE 2004
Greater Bay
Airlines 大灣區航空 HB GREATER BAY 2022 expected
Luxury Airline
Make every trip more comfortable
Offer premium perks and upgrades for tourists
Enhanced privacy, upscale food and beverage service, access to premium
entertainment and private transportation to and from the airport
Amenities offered for first class and business class 23
Airlines – low cost / fare
airlines
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Provide shorter routes, with high turn around frequency
Use older planes or rent planes from others
Operate with higher load factors
Stop at secondary airports
Cut fringe services
Extra fees for other additional services
Cut out intermediaries, or low commission to agents
Online rather than having a physical distribution offices
Cruise
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Uniqueness of Cruise Products-
A Blend of the 5A’s
265 A’s:
Attractions Activities Access
Accommodation
Amenities
Types of Cruises
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Ocean Voyages: A one-way passage from one point to another over a major body of water.
Standard Cruises: An open water cruise may be one way or round-trip with several ports of call.
River/Canal Cruises: River and canal cruises are closely linked to the culture and heritage of the country being toured.
Destination / Expedition Cruises: based on the
destination to be visited.
Common International Cruise Routes
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1. Alaska
2. Caribbean
3. European Areas
4. Canada & New England 5. Hawaii
6. Asian and Pacific Region 7. Panama Canal
8. South America
• 阿拉斯加
• 加勒比海
• 歐洲地區
• 加拿大及新英格蘭
• 夏威夷
• 亞洲及太平洋地區
• 巴拿馬運河
• 南美洲
Fly-Cruise 海陸空之旅
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Have to fly to the home port first
before taking the cruise It is common because:
Not all cities have cruise terminal
The place of residence is not a home port The place to go is far away and there is a
limitation in time spent for a vacation
Dinning Area
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Dinning Room: cruisers will have breakfast, lunch and dinner in cruise. So large cruise will have several features dinning rooms.
Alternative Dinning Area:
buffer, pool side kiosk or bar will
be provided in modern cruises.
Showrooms
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Entertainment events usually take places in cruise each night to entertain
guests as well as make money.
For instance: dancing night, discos, wine tasting and opera.
Pool Area and Health Club
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Majority of ships have one or more swimming pool.
(indoor & outdoor) They will normally locate in upper deck with nice view.
Massages, facial treatments, saunas, aromatherapy and other beauty or relaxation-related service will be indeed needed by cruiser who look for relax trip.
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Casino and Internet Center
Gambling is usually legal on cruises, most cruise vessels boast casino where cruisers can play blackjack, roulette and other games.
Internet access will be offered, guests can send or receive email to extend their business from office if necessary.
Gift Shop & Medical Facility
Cruisers can buy sundries, swimsuit, souvenirs and duty-free
goods in the cruise. It could convenience guests and generate capital to cruise company.
One or more duty nurse must be assisted in cruise which
accommodates 200 or more passengers required by maritime law.
Distribution Channels
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Three Different Forms of Distribution Channels
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UNILATERAL BILATERAL MULTILATERAL
What Is a Unilateral
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A contract agreement in which an offer or promises to pay after the occurrence of a specified act
Most often used when an offeror has an open request in which they are willing to pay for a specified act
In a unilateral contract, the offeror is the only party with a contractual obligation
Direct book with hotel or airline companies
What is Bilateral
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An agreement between 2 parties which establishes some terms and conditions
Represents the value of goods and services that have been exported from one party to another
Influencing factors include international and
domestic policy in both providers and consumers
Deliver the goods or services from supplier to travel retailer, such as travel agents, and then to
customers (end user)
Make booking through travel agents (such as OTA)
What is Multilateral
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Process of booking between groups of three or more parties
Multilateralism is generally considered to comprise certain
qualitative elements or principles that shape the character of the arrangement or institution
Service
supplier Travel
wholesaler Retailer Customer
Hotels or
Airlines GDS Travel
Agent
Business or Leisure
Traveler
Intermediaries
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Types of Intermediaries
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Retailers, link between the tourist industry and retailing. Shopping, buying local products and trying out local cuisines are integral aspects of the tourist experience.
Distributors, the series of companies or businesses that are involved in transporting, storing and providing goods and services to customers
Wholesalers, a company that showcases and distributes travel products such as hotel rooms, transfers, and ancillary products to their network of clients
Agents/Brokers, individuals or companies that act as an extension of the product
providers, make their profits through fees or commissions
Roles and functions of travel agents
41 The main members of the tourism supply chain (Zhang et al., 2009; Tigu and Calaretu, 2013)
1. Accommodation Companies 2. Transportation Companies 3. Food and Beverage
Companies
4. Recreation Companies 5. Shopping Companies 6. Travel Agencies
7. Tour Operators
1. Preferred supplier is a company that signed
agreement with another company to provide it with both goods and services 2. Partnerships are very
common in the travel industry
3. Potential for symbiotic and mutually-beneficial
relationships
Roles and functions of travel agents
1. Providing one-stop tourism products, wide variety of needs includes food,
accommodation, transport, touring and
sightseeing, shopping, entertainment, linking tourists with tourism service providers
2. Retail channel for tourism products,
transport, accommodation and catering organizations will also sell their own
products/services directly to travelers
3. Facilitating customers’ tourism activities and promoting the development of the tourism, travel agencies can book the relevant travel services before the customer departs,
guaranteeing that the trip will go smoothly industry, customize guests needs such as study tour
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Factors Considered by a Travel Planner When Planning a Tour
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Factor of consideration Key Elements in a Tour
Hotels Transports Food Itinerary
Preferences/
needs
star rankings
location of hotels
departure and arrival time
mode of transport
healthy food guided tour
self-tour
Interest Entertainment
facilities in-flight local and
traditional cuisines
shopping
sightseeing
adventure Budget
Standard
Deluxe
Suite
economy class
business class
first class
meals are included or excluded
entrance fees of theme park and other own
expenses Safety Hotel licensed history of accidents
under
the brand
risk of food
poisoning risk of crimes
and thefts
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Product Knowledge Required by a Travel Agent
Product Knowledge Examples
Destinations Climatic conditions Political situations Major attractions
Travel regulations and documents
Airlines Reservation system
Route operations Flight schedules Fares
Services offered on board
Airports Timings
Facilities
Custom and security regulations Distances from cities
Surface (Rail and Road) and Water Transport Time tables
Fares and car rentals
Reservation systems and procedures Principal Suppliers Image and financial standing
Quality of service Knowledge of Other Aspects Local excursions
Special interest tours
Disintermediation
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Customers get more direct access to items or services by reducing or eliminating third parties
Self-booking tools and unlimited access to
information made for better-informed travelers by internet
Customers achieve truly personal and crafted experiences
Rise of airbnb
Technology to eliminate the obstacles between tourists and destination
Impacts of tourism
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Positive economic impacts of tourism
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Creating jobs, large number of people with various levels of skills and abilities
Direct employment: employment generated from business that directly provides services to tourists
Indirect employment: manufacture goods and provide services which are bought or used by business
Provide tax revenue
Direct taxes: salary tax, increase in tourist expenses would result in an increase in income of people working in the tourism industry
Indirect taxes, departure tax and hotel room tax, expenditure tax
Improve the balance of payments: flow of goods, services and capital in and out of a country during a given period
Economic growth from multiplier effect: foreign exchange earner for
developing countries
Tourism Multiplier Effects
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•Expenditure in destination (attract capitals from overseas)
•Tour operators (travel agents)
•Investors (international theme park investors)
First order:
•Wages (local people income)
•Interest (attractions such as Tai Kwun)
•Profits (trading & selling)
Second order:
•Savings (local people save money in bank)
•Tax (charge consumption tax
Third order:
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Tourism Multiplier
Effect
Transactions (or sales)
multiplier
Output multiplier
Government revenue multiplier Employment
multiplier Income
multiplier
Transactions (or sales) Multiplier
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Estimate a business's value based on the multiples used in a peer group of transactions
Measures the amount of additional business revenue created in an economy
Result of an increase in tourist expenditure
Output Multiplier
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Measures the amount of additional output
generated in an economy as a result of
an increase in tourist expenditure
Output multipliers are concerned with changes in the actual levels of production and
not the volume and value of sales
Not all sales will be related to current production (payable
makes inventories increase)
The value of an output multiplier and
transactions multiplier will be different
Income Multiplier
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Measures the additional income
A dollar spent turns into more money
Places will then re-spend that money
on inventory, utilities and more workers
Wages and Salaries, Rent, Interest and
Profits
Employment Multiplier
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Measures the amount of direct, indirect and induced jobs created in the city
Measurement of either the total amount of employment generated by an additional unit of tourist expenditure
Or
The ratio of the total employment generated by this same expenditure to the direct employment alone
Government Revenue
Multiplier
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Measures the impact on
government revenue, from all sources, associated with an increase of tourist expenditure
Expressed in gross terms
Net terms, government revenue is reduced by the increase in
government expenditures
associated with the increase in
tourist activity
Conclusion of Tourism Multiplier Effect
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Spending on tourism is huge on a global scale which means good revenue
Net contribution to a destination’s economy depends largely on the spending leakages May be affected by imports, taxes and
repatriation of profits and wages
Negative Economic impacts of tourism
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Facilitate the increase in consumer prices and land prices: great pressure on the
limited resources in host country
Over-dependency on tourism: popular destination may become out of fashion
quickly, the business and quality of life may be changed dramatically
Generate leakage
Expenditure on imported goods and services required
by tourists
Money earned and sent to their own countries by foreign workers in tourism
industry
Profits of foreign-company- owned tourist facilities
diverted overseas
Socio-cultural Impact In
Positive
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Improve the way of life
Promote social development through employment creation
Supports the creation of community facilities and services
Upgraded infrastructure, health and transport improvements
Improve the reputation and visibility of host community
Encourage cultural exchange
Learn about each other’s culture and custom
Respect and tolerance for each other’s culture
Develop and extend host countries’ culture
Boost for cultural conservation
Boost the preservation and transmission of cultural and historical traditions
Appreciation of local art, crafts, folklore, history, religion or
language
Socio-cultural Impact In Negative
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Lifestyles
Congestion
1. Visitors and local residents over shared usage of local recreational facilities 2. Additional demands on social services and supporting infrastructure
3. Conflict of land use
Transformation of forms and types of occupation
1. Draw workers from other sectors of the economy
2. Place people, especially women and young people, in a financially less dependent position
Health problems
1. Spread diseases, such as COVID-19
2. Over usage of facilities such as sewage treatment with health risks
Socio-cultural Impact In Negative
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Moral Issues
• Possible unethical issue
• Prostitutes concern
Crime Generation
• The density of the population
• The location of the resort in relation to an international border
• The per capita incomes of hosts and tourists
Doxey’s Index of Tourist
Irritation
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Based on the understanding of local residents’ attitude change toward tourists and tourism development in different stages of a destination’s life cycle
Assumes the resulting circumstances with negative sociocultural impacts can lead to irritation in the local community
Irridex has been currently considered as one of the most important models between local residents and tourists
FOUR stages including:
1. The level of euphoria 2. The level of apathy 3. The level of irritation 4. The level of antagonism
5. The final level (the result of the FOUR stages)
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Doxey’s Index of Tourist Irritation The level of euphoria
(興奮愉快)
1. Residents are enthusiastic and thrilled by tourist development
2. Opportunities for locals and tourists bring in money
The level of apathy (理所當然)
1. Industry expands people begin to take the tourist for granted
2. Profit-taking and contact become more formal
The level of irritation (煩厭不快)
1. Close to saturation point
2. Locals cannot handle the numbers without expansion of facilities
The level of antagonism
(敵對感覺)
1. Irritations have become more overt 2. See the tourist as the intruder
The final level 1. Ecosystem will never be the same
2. Must learn to adopt the changes
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Environmental impact in Positive Preservation and conservation of
environment 1. Provides the necessary motive and money for preserving treasures and ancient monuments 2. Make natural resources sustainable
3. Converted to agriculture, mining or other forms of industrial development
Enhancement of environment 1. Improve destination image by planting flowers, developing well-designed tourist facilities
2. Provides incentive for “cleaning up” the overall environment
Development of environmental
awareness 1. Encourage local awareness of natural environment 2. Controls and planning to maintain the quality of the
environment
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Environmental impact in Negative
Water pollution 1. Rivers, lakes, and the sea polluted by recreational and tourist transportation 2. Untreated sewage from kitchens and bathrooms of island resorts
Air pollution 1. Excessive use of vehicles
2. Major tourist attraction areas that are accessible only or mainly by road Soil pollution 1. Litter is the most visible
Noise pollution 1. Vehicles, aircraft and motorboats
2. Theme parks, car or motorcycle races may generate noise Visual pollution 1. Poorly designed buildings
2. Use of large and ugly advertising signs
3. Poor maintenance of buildings
Measurement of Environmental Impact
The Importance of Environmental Impact Assessment (EIA)
Limited environmental resources are being consumed
Environmental impacts: Physical, Biological and Socio- economic ( culture)
Conducted for evaluating how serious the environment could be affected
Key Considerations of Environmental Impact Assessment
In general speaking EIA is:
mainly for evaluating the net economic returns of tourism activity
compare alternative developments and allocate resources more effectively
to raise the profile of environmental issues
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Measurement of Environmental Impact (con’t)
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OECD Framework in Assessing Tourism and Environment Stress Stressor activities Stress Primary response
environment Secondary response (reaction) human Major construction
activity
1. Urban expansion 2. Change in land
use
1. Restructuring of local
environments
2. Lands being taken out of primary production
1. Change in population
2. Change in health and welfare
3. Change in visual quality
1. Designation of wildlife conservation and national parks
2. Controls on access to recreational lands
Generation of waste
residuals 1. Effluent discharges 2. Solid waste
disposal 3. Noise
1. Change in quality of environmental media
2. Health of humans
1. Recycling of waste materials 2. Decline in tourist revenues
3. Expenditure of pollution abatement by tourist-related industries
Tourist activities Destruction of species 1. Change in habitat 2. Change in
population
1. Expenditure on management of conservation
2. Controls on access to recreational
lands
The studies of Impacts of
Tourism in Hong Kong
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Positive Impact
Improving employment opportunities, tax revenue, and economic diversity (Kim et al., 2013)
Residents may actively participate in tourism activities when they perceive positive tourism impacts (Gursoy &
Rutherford, 2004)
Tourism impacts on a destination are economic, sociocultural, and environmental among others (Andereck et al., 2005; Ogorelc, 2009; Nunkoo &
Ramkissoon, 2011; Uysal et al., 2016).
Negative Impacts
Quality of life in the destination, include crowding, traffic congestion, and environmental pollution
(Andereck & Nyaupane, 2011; Andereck et al., 2005)
Bring along social problems which could contribute to
social and cultural changes in the host community
(Perdue, Long, & Kang, 1995)
Positive
Impacts of Tourism in Hong Kong
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Improves the area’s appearance
Preserves historic buildings and monuments
increases employment opportunities
increased availability of recreation facilities/opportunities
Demand for historical and cultural exhibits
Promotes cultural exchange
Contributes to income and standard of living
Increases tax revenues
Increases opportunities for shopping
Improves transport infrastructure
Negative Impacts of Tourism in Hong Kong
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Tourism creates an increase in traffic congestion
Increases noise pollution and litter
Results in over-crowding
Heightened tension between residents and tourists
The district shops tend to tourists
Inflation concern
Changes in tourism industry
under the COVID-19 pandemic
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The changes of Hong Kong Tourism under COVID-19
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The changes of Hong Kong Tourism under COVID-19
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Staycation, focus on residents, but low margin
Shopping arcades reduce income contribution
Food and Beverage selling dropped
Retails particular Jewelry, cut some stores in major tourist districts and added new ones in local residential areas (Lok Fook)
Ocean Park Hong Kong only had 1.4 million visitors in 2020 (given that provided different discounts)
Disneyland Hong Kong only had 1.7 million visitors in 2020
The changes of Hong Kong Tourism under
COVID-19
1. Flycation arrangement 2. No more Cathay Dragon
3. Cathy Pacific losses of HK$7.6 billion (US$977 million) in the first half of 2021
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Stakeholders
Local community and tourists play essential parts, tourism development comes from the conflict between these two groups (Wassler et al., 2016)
Residents must share nature- based resources with inbound tourists (Tsaur et al., 2006)
Different stakeholders’
perceptions and preferences towards nature-based tourism in Hong Kong (Suh & Gartner, 2004; Zhang & Chan, 2016)
Mainland Chinese visitors drive Hong Kong’s tourist numbers to record high of 65.1 million in 2018
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Hotel staycation package
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Staycation hotels may be forced to extend their service to those wrong segmentations
Lower down the profit margin to gain the cash flow to avoid lay off
Designated Hotels for Quarantine, it may affect the staff perspective and hotel reputation
Hotel room likes a party room
Conflicts between hotel staff and local residence
Virtual tour
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Changes in tourism
industry
under the COVID-19 Pandemic
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Cultural Playground
Cultural preservation
Local guided tour
Tourism workshop
Virtual tour and
activities
Virtual Tour providers’
Experience
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Interaction virtual tourism
Story telling
You can make decision
Indoor and outdoor views
What makes virtual tours work?
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Storytelling and theatrical approach, the content is entertaining and informative.
Participants can go through all the way and merge the selected destination
Human touch in the time of social
distancing, emphasize interaction with the audience, respond instantly to
participants’ preferences and choices to customize the experience
Excellent technology, as the technology keeps improving such as 5G mobile
network to provide clear and stable
connection
Arise of
Tourism KOL
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KOL culture will be a factor to affect people to join virtual tour motivation
Communication and learning will be more interactive and eager
Cost saving, as the KOL can
entertain many people at the same time, no tour guide and tourists’
ratio restriction
Old generation will not enjoy this
type of business
Future development in tourism industry
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Buy products through virtual platform
Online and Offline dual business mode
Eco tourism and sustainable tourism as having more experience with the local heritages
Tour will be more diversified
Multi-languages required
Accelerate the withdrawal of traditional travel agents from the market
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Future
development in tourism
industry
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