Innovation typology in tourism
For instance, it is possible to adapt a successful innovation in diverse destinations. Besides, the same organization can operate in different regions successfully. Accordingly, collaboration inside and outside the destination plays a major role in tourism innovation.
Porter (1998) defines competitive advantage in productive terms. Thus, productivity depends on quality and features as well as on production efficiency. In the tourism industry, organizations that invest in quality and product diversification are usually very competitive. Quality and differentiation are the solution for decreasing numbers of customers in several destinations. Changes in quality can also influence the application of more appropriate price strategies. Other destinations, however, that do not innovate in this direction have a disadvantage towards competitors.
Regarding production efficiency, several tourism organizations invest in efficient production methods in order to increase productivity and decrease costs. In this matter, Weiermair (2006) points out that innovation is fundamental to reduce costs of production and marketing and provide product value. Many tourism firms, however, try to reduce costs by offering low wages to employees, which does not enhance innovation and does not improve competitiveness in the long term.
Thus, in order to develop a framework that describes the situation of the sector towards innovation, both competition and cooperation must be taken into consideration. Furthermore, several subjects such as globalization, demand needs, sustainability, industry’s structure, professionalization and seasonality need to be analyzed.
Changes in the Tourism Sector
Despite the fact that tourism has been constantly influenced by continuous changes in market and environmental conditions, it is necessary to study in detail three factors that have lately influenced competition in the sector.
First, global development and deregulation have increased competition in the tourism sector (Weiermair 2006). Although the process of globalization is not new it has influenced tourism in the last decades. With the access of more regions to global markets, tourism consumption has grown, extending the sector to new economies (Hall and Williams 2008). Accordingly, the number of tourists has increased. Besides, new destinations have emerged. As a result, the level of competitiveness among regions has augmented. In this context, several destinations that were good positioned in the market still have competitive advantage, but they have to adapt to new conditions.
A second factor that influences competitiveness in tourism is the existence of more experienced tourists. With the growth of tourism consumption, tourists demand alternative products. Besides, tourists are more demanding because it is easier to access information. Furthermore, access to information has motivated tourists to be more independent. As a result, the number of self organized holidays has grown in the last decade.