Innovation typology in tourism
At destination level organizational innovations emerging from public institutions can benefit the structure of the sector. Government motivates the creation of collaborative structures. Furthermore, public institutions carry out promotion of the destination. In this context, marketing innovations are of great relevance. Public institutions may also complement the tourism product by offering several services in the destination, which implies that they also invest in process and product innovation.
Entrepreneurship has been traditionally related to private firms. However, public institutions can have also entrepreneurial characteristics (Hall and Williams 2008). At the level of the destination, public institutions may act as entrepreneurs thus creating new business opportunities, changing the image of destinations, etc.
Several authors have indicated that the interaction between producers and users is at the core of the innovation process (Sundbo et al. 2007, Asheim and Gertler 2005, Lundvall and Vinding 2004). In the interaction between producers and users, transfer of knowledge goes in both directions. Users provide tacit knowledge to organizations, which might be then codified. With the knowledge acquired from users, producers develop new solutions that they offer to users. Accordingly, both actors benefit from the process of interaction. In this matter, diversification of sources plays a major role. Thus, innovators may benefit from accessing to knowledge form different users.
Product and processes in experience service industries are created through the interaction between providers and customers. In other words, tourists participate in the development of service innovations. They do not only provide information, in fact they participate as innovators. The degree in which they participate depends on the type of tourist. In this matter, the growth of a more experienced demand has increased the level of participation of tourists in the creation of products. Thus, more experienced tourists tend to purchase personalized services, organize several parts of their holidays and interact more with the tourism industry. Thus, personalization is a result of specific user needs. Tourists demand more personalized services. Accordingly, services are adapted to each customer. This implies a series of incremental changes, which may develop into innovations. Thus, the process of cooperation between providers and customers is a cumulative one. Service providers and tourists interact with a common objective: the improvement of services. In order to answer user needs, organizations may add new elements to services or enhance quality. User needs may also motivate to improve efficiency thus reducing costs. As a result, tourists may have access to similar products at lower prices. User needs may also motivate changes in the marketing strategy or in the organizational structure. In this context, dynamic and flexible structures are more able to interact with customers and adapt to their needs.
Innovation performance in destinations might be also influenced by the local population. Local population often interacts with public institutions. Accordingly,