JK

I’ve worked in the more mature (from an ecommerce standpoint) segments in the travel industry (hotel, car, air) and am now moving into the tour, DMO and activities segments. What I find most striking in my conversations about online distribution with companies in these segments is a paralyzing fear of product commoditization. They don’t like being compared to retailers because they consider their products to be unique, specialized, and customized to the consumer.

These companies are making the basic mistake of not separating the product from the commercial distribution process. The nuts and bolts technology needed to support a viable ecommerce program IS a commodity – bits and bytes, XML, etc. – but it has nothing to do with the product itself. Just because a product is available via a website doesn’t mean it’s mass-produced but many companies believe their customers will somehow devalue the product if it’s available via an electronic channel.

Also, many SME companies put great emphasis on providing personalized service, something they believe sets them apart the big brands in the travel industry. They may extend that argument to say that technology will separate them from their customers, taking away that element of service. They could even take pride in James’ example in a previous comment that they respond to every email, even if the emails are complaints about site usability or unhelpful incomplete product information, to bolster their argument about their personal relationships with their customers.

The combination of these beliefs in some cases manifests itself as a sort of hostility to technology and online distribution, which seems to me to be a tremendous obstacle to commercial success.

This is a fascinating topic, and I look forward to reading more of your insights.

Excellent exchange here. Just came across it via Anna’s latest tweet. I recognize the commentators and share entirely the opinions expressed, therefore, I can be brief. Let me just add a few thoughts as a former insider working in a national DMO during a period of at times wrenching transformation from a government like bureaucracy to a modern, customer and market focused marketing organization.

I’m well aware of how tough that task of transformation was now nearly twenty years ago for all but the most dynamic of these organizations. It’s only more complicated now. Often with top leadership still appointed by government and changing ever so often preventing a long term vision to be formulated. The result is short term focus – as Anna mentions – on the latest tactics rather than a review of strategic objectives suitable to today’s faster than ever changing landscape. The lack of budget is but a bogeyman as most of these organizations would find more funds available if they were only willing to take a harder look at past and present activities which are too often continued more to please internal stakeholders than future customers.

Another road block is that it seems to me too many DMOs are myopic and “consultant-averse”. The prevailing wisdom is one of either having all the necessary know how available in-house or then the opposite, that with the present staff situation they couldn’t execute and implement new solutions anyhow. As a result they are constantly trying to catch up and play defense rather than hiring an unbiased, independent outsider, form a task force of action oriented insiders from all levels and tackle the issues head on.

It’s not too late, but the changes today on the web are such that in a few years the role DMOs played in the past will be absorbed into the vast conversation taking place among millions of web savvy and enabled travelers and local experts, supported by technology tools developed for the social web that allow the spread of knowledge in an instant with higher credibility than any institutional voice. The consequences for slow moving institutional entities can be rather easily imagined.

I have become very interested in the notion of collective intelligence and the idea that intelligence in a group is distributed, This applies to tourism communities. The role of DMOs should therefore be to create the conditions in which solutions and intelligence emerge and benefit the whole. That implies far more of an educational, enablement role than they have performed. less on doing and more on letting skilled people do.

Look at the emergence of companies like Spotted Locals who are able to move far faster than the fastest DMO…

I hope to return to Scotland soon. I cut my teeth up there doing the first IT tourism strategy for th cuntry that dared suggest it move off propietary systems to an open source internet, That’s how old I am!!!

I will be mischievous though and say that your insight about ‘industry’ reminded me of Margaret Thatcher’s words that ‘there is no such thing as society’! I think she was meaning something very much along your lines that there isn’t this real ‘thing’ out there called society with a head office and corporate notepaper – but rather that society is in reality lots of people and families making decisions and living their lives independently and I think you are making a similar point that to talk of the ‘tourism industry’ is a similar fallacy.

However, I’m not sure I can stretch my analogy too far and use it to help you answer your question about the role of the DMO! I guess the only insight that immediately comes to mind is that Governments have different roles at different times according to circumstances (e.g. less to do in peace time that in war, more to do in time of hardship than in prosperity) and I suspect that the role of the DMO might be the same.

Confirm some key reasons

1. Lack of time
2. Education about Internet and the basic
3. low and poor investiment in IT
4 . people who want result too fast
5 . turnover in tourism
6 . lack of strategy and long term vision
7 . no anticipation

It’s difficult !

You make so many valuable points but the following is an incredibly significant one for me:

“We consistently describe tourism as an industry when it is actually a dynamic network of independent self-organizing agents unified when they they serve a common customer”

You’re absolutely right of course and I would love to hear more about your thoughts (research?) on the role of the DMO (and other facilitators) when as you say, everyone is an intermediary.

I also agree wholeheartedly that tourism argues it is a special case and so always looks inwards first, and that this particularly does it no favours when it comes to technology and IC. Your financial services friend is right, tourism technology is both complex and strategically critical – looking inward and backward and for “the next big fad” is not the place where business will evolve.

Oh, and I would gladly trade a spot to stable my horse for free wi-fi any day

Thank you so much for sharing your thoughts and I hope we will meet again to continue this conversation!

I think all the reasons you identify are valid but would add the following:

1. Travel and tourism doesn’t think of itself as an e-business.
Yes and No. I don’t think travel and tourism businesses are any more “e-” businesses than any other business that must adapt to new channels of distribution or new modes of management. All business takes place in a context and must adjust to changing market conditions. In the 18th Century the visitor wanted a stable for his horse and sufficient candles to read by night. The inn business gradually changed over time and now we have parking lots, electric lighting and flat panel TVs. But only rarely do we get free wifi!!

But it goes deeper than that. The entire community sees itself as an industry – a false perception. We do not operate as a whole like large multinational, vertically integrated corporations with a relatively static and straightforward supply chain that is harnessed to produce a range of products. The visitor defines the nature, timing and scope of the experience (a.k.a. the product) which is supplied by a host of independent agents that may or may not be aware of one another and do not necessarily belong to any formal arrangement unless they are part of a tour operators’ stable or have formed a consortium.

We consistently describe tourism as an industry when it is actually a dynamic network of independent self-organizing agents unified when they they serve a common customer. In times of misery they may cling together but more often or not spend most of their time competing fiercely with their neighbours. Much of the legacy IT systems were based on a premise of rigidity (either technically or culturally) and could not adjust to the real world of rapid technical evolution, changing customer demands and travel patterns.

Unless they experience a fundamental change of perspective (a mindset shift) then their relevance will continue to deteriorate. The focus of my work now is – what is the role of a DMO when everyone is an intermediary?

2. Under investment

You are very right to describe and stress the complexities involved. My good friend and IT mentor Leon Benjamin, who came from supporting the trading of financial derivatives (way beyond me) said tourism was more complex but sadly lacked the deep pockets of the bankers. Now perhaps tourism and banking are less far apart financially!!

I find that few destinations (DMOs) have an understanding of their members as part of a dynamic system nor have been able to craft a strategy that understands how to support a complex adaptive system for the reasons of perception or misperception articulated above.

To make matters worse, the system is constantly changing – destinations find the pattern of consumption changing (eg from packages to FIT; from travel agents to self service; from longer to shorter decision to booking times); from relatively limited channels to infinite channels, many of which cannot be accessed or negotiated with (my personal Facebook page, for example, is off limits)

3. No room for an online specialist

As you know, there are two kinds of IT folks – those that support the running of the parent organization and those whose job it is to support the marketing activity and customer service. Most medium to large organizations have only been able to afford one of these (and have then expected them to perform the two functions) and most micro businesses haven’t been able to afford that.

I feel there is real potential for micro businesses to share access to IT skills but as they still are operating from a mindset that believes the next door motel, inn or B & B is a competitor then that kind of collaboration is unlikely.

4. Bolt ons and legacy

The pace of technological change has completely overtaken the tourism community who managed with brochures for over a hundred years, promotional films emerged in the 50s; video recording and online videos are every recent and now we have an explosion of user generated content.

I am often asked to speak to DMOs and, where technology is concerned, they never ask – what should our strategic approach be but “what is the next big thing?”

Facebook, UGC, Mobility, Twitter….. and next year there’ll be something else.

5. Best practice examples from public bodies

Most public tourism bodies are either government departments or quangos and crown corporations set up and partially funded by governments. They come from a command and control, industrial mindset that is organized into soloed functions. They have rigid procurement processes which preclude them from being agile and experimental. They look to best practice elsewhere because they cannot afford to take a risk and fail. So they can hardly model the necessary agility, experimentation, rapid prototyping approach that smaller, less constrained organizations of the private sector can.

6. Sectoral isolation

Tourism argues that it is a special case and its fragmentation mean that each sub sector looks inward first (eg hotels, motels, bed & breakfasts etc) and then to other tourism-related sectors (eg accommodation considers transport or entertainment) long before it looks at the “outside world”.

Phew! But thanks for the opportunity to think out loud.

The link again: http://www.atdw.com.au/tourism_e_kit.asp