Private Label in the Tourism Industry: The Effects of Economic Crises

Private Label in the Tourism Industry: The Effects of Economic Crises

Juan José Blázquez-Resino (University of Castilla-La Mancha, Spain), Cesare Amatulli (LUISS Guido Carli University, Italy) and Giovanni Pino (University of Salento, Italy)
DOI: 10.4018/978-1-5225-5187-4.ch084
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Abstract

Tour operators and travel agencies who produce and sell tourism products under their own labels represent key players among the multiple intermediaries that exist in the tourism industry. This chapter aims to study the direct and indirect effects that the economic crisis has had on these private labels. The economic crisis had a moderate effect on tourism, but it also accelerated a number of changes that had been occurring in the sector. Through the study of the current situation and the one produced in recent years, this chapter develops a series of recommendations for traditional private labels to maintain their income and market position. We ascertained, in particular, that the new information and communications technology has led to a different market situation for tour operators and travel agency labels, which may disclose new opportunities in the process of differentiation and the creation of a competitive advantage.
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Introduction

Tourism is a sector characterized by increasingly sophisticated customers, innovation, and competition. Thus, tourist organizations must offer high “quality experiences” (Ritchie & Ritchie, 1998) in order to compete and succeed. For tourist destinations, this implies that being included in customers’ evoked set of tourist destinations is no longer enough, but that it is now necessary to be unique and differentiated (Qu, Kim, & Im, 2011). From this perspective, it is generally accepted that branding is one of the most powerful marketing strategies to achieve competitive differentiation (Tasci, Gartner, & Cavusgil, 2007). Effective brands provide functional benefits, favorable associations with physical characteristics, and emotional benefits. Therefore, companies developing their own brands can successfully achieve better sales performances, repeat purchases, and consumer satisfaction. It is generally agreed that tourism destinations can be branded in the same way as consumer goods and services (Caldwell & Freire, 2004). Indeed, destinations are a bundle of tangible and intangible attributes (Hosany, Ekinci, & Uysal, 2006) that aim to establish long-term stable relationships with the customers (Trimeche, Trimeche, & Wakabayashi, 2012).

Surprisingly, although branding has gained importance in the tourism industry in the last two decades, there is a dearth of empirical research aimed at exploring the application of branding tourism products. The main reason for this lack is the fact that branding is typically synonymous with image-building and image-reconstruction (Park & Petrick, 2006). Consequently, many studies have focussed on the assessment of the most effective ways to build strong and positive images as critical stimuli for motivating tourists in their destination choice process. However, previous literature also asserts that branding is different from image-building in regards to the unique identity of a tourist destination (Park & Petrick, 2006). In this sense, brand image and brand identity can be considered critical ingredients for a successful tourism label (Cai, 2002; Florek, Insch, & Gnoth, 2006). The difference between images and brands is that they are generated from two different perspectives: images are perceived by the receivers, while brands are created by the sender. The relationship between destination identity and image is reciprocal (Qu et al., 2011). Indeed, tourist destinations build their images based on the brand identity projected by the marketers, and marketers establish and enhance brand identity based on the image perceived by their customers. Therefore, identity reflects all features and activities that differentiate the tourism product. As a tourist product is based on a variety of resources, services, and experiences, most of which are typically managed by different stakeholders (Konecnik & Go, 2008), branding is a particularly complex task in tourism. The need to engage all the stakeholders leads to simplifying all aspects of the strategic communication of tourist destinations.

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