Umbrella of tourism and hospitality industry

Business

6 Unit 1 The Hospitality & Tourism

8 Unit 1 The Hospitality & Tourism Business

The World of Hospitality & Tourism

Business

6

Unit 1 The Hospitality & Tourism

3 Unit 1 The Hospitality & Tourism Business

AS YOU READ ,..

YOU WILL LEARN

· To describe the hospitality and tourism industries.

· To identify the segments of the hospitality and tourism industries.

· To define service as a product.

· To explain the importance of service to the hospitality and tourism industries.

WHY IT'S IMPORTANT By identifying and understanding the nature and variety of these industries, businesses and marketers function more effectively.

KEY TERMS

· hospitality industry

· bed-and-breakfasts (B&Bs)

· tourism industry

· service

· variables

· perishability

· intangibility

· changeability

PREDICT

What might the hospitality industry have in common with the tourism industry?

hospitality industry a group of businesses composed of establishments related to lodging and food-service management

The Importance of Hospitality & Tourism

H

ospitality and tourism are two of the fastest-growing and most exciting industries in the world today. They encompass more than 15 related businesses, including lodging, food service, transportation vendors, and tour operators. These industries employ more than 8 million people who earn more than $165 billion in wages and salaries. Annually, hospitality and tourism generate in excess of $525 billion in sales. In the United States, the tourism industry is the third-largest retail industry behind automotive and food stores, and it is our nation's largest service-export industry. One out of every seven Americans is employed either directly or indirectly because of visitors traveling to and within the United States. Opportunities are endless for well-prepared and motivated individuals who want a challenging, fast-paced future in hospitality and tourism.

Industry Segments

F

ew industries in the world are as complex, diverse, and interrelated as hospitality and tourism with many segments—lodging, food service, travel, tourism, and sports and entertainment events. (See Figure 1.1.)

Hospitality Industry

Traditionally, the hospitality industry is a group of businesses composed of establishments related to lodging and food-service management. These businesses include hotels, motels, inns, and bed-and-breakfasts (B&Bs), or small unique inns that offer a full breakfast with a night's stay, as well as casinos, restaurants, catering companies, hospitals, schools, and many other facilities.

Tourism industry

The tourism industry is a group of businesses that encompass travel/transportation vendors for air, rail, auto, cruise, and motor-coach travel, and promote travel and vacations. Destination marketing firms, such as tourism offices, convention and visitors' bureaus, and chambers of commerce, distribute information to travelers.

Other Providers

In addition, providers of recreational facilities and meeting-planning services are included under the umbrella of the important and rapidly growing industries of hospitality and tourism. The sports and entertainment industries rely on consumers who spend their money and free time watching or participating in their favorite pastimes and activities.

Product as Service

A

product is not only a tangible item, or good, it can also be a service, or an intangible thing that is a task performed for customers by a business. It is simple to think that hotels sell rooms) and restaurants provide food. However, no guest will return to a facility-hotel or restaurant—unless the service provided with the room or the food is quality service. For example, hotel guests will not be satisfied if the sleeping room is pretty, but the front-desk clerk is rude. Similarly, no customer will enjoy a dining experience if he or she has to wait more than an hour to receive his or her food after placing an order— even if the food is excellent.

The Service Factor

Products can be goods or services. In the hospitality and tourism industries, most products are services. This service factor in all segments— lodging, food service, travel, tourism, and sports and entertainment events—is what differentiates these industries from most other industries. Therefore, it is necessary to take both a goods and a service approach to hospitality and tourism products.

GOODS VS. SERVICES Physical products, or goods, are easy to identify. For example, hotels have sleeping rooms, meeting rooms, recreational facilities, and restaurants. Food-service establishments may offer products such as food and beverages, which are types of goods. A restaurant may also offer service in the form of entertainment. It is easy to determine whether a room is clean and whether food is tasty. However, it is more difficult to determine if quality service is being provided.

bed-and-breakfasts (B&Bs) small unique inns that offer a full breakfast with a night's stay

tourism industry a group of businesses that encompass travel/transportation vendors for air, rail, auto, cruise, and motor-coach travel, and promote travel, and vacations

service an intangible thing that is a task performed for customers by a business

CONNECT

Wn at factor makes hospitality and tourism different from other industries?

Lodging Food Service Travel Tourism Sports & I Entertainment Events I Hotels QSR restaurants Cruise lines DMOs Arenas Motels Catering companies Rail service CVBs Arts centers B&Bs Banquet facilities Car rentals Tour operators Theaters Resorts Fine-dining restaurants Motor coach Visitor centers Parks HOSPITALITY & TOURISM VARIETY All of these industry segments share a common characteristic: All rely on providing a quality service experience to the guest. Can any of these businesses be listed under more than one segment? Why or why not?

Hospitality & Tourism Industry Segments

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8 Unit 1 The Hospitality & Tourism Business

QUESTION

w hat is the meaning of intangibility? How does it relate to hospitality and tourism?

variables factors that can cause something to change or vary

perishability the probability of a product ceasing to exist or becoming unusable within a limited amount of time

intangibility a state of being abstract, as are things that cannot be touched

Product Variables

When marketing the service side of the hospitality and tourism industries, you need to consider these variables, which are factors that can cause something to change or vary:

Perishability—In hospitality and tourism, perishability is the probability of a product ceasing to exist or becoming unusable within a limited amount of time. For example, the owner of a 100-room hotel needs to sell as many rooms each night as possible. Any rooms that remain vacant on a particular date cause lost revenue that can never be recovered. On the food-service side, if a restaurant orders 100 pounds of fish, and customers do not order fish from the menu, the owner will lose money. From a travel/tourism perspective, a cruise ship can service 2,100 passengers. If the ship sails with only 1,100 guests, the lost income will never be returned.

Intangibility—In general, intangibility is a state of being abstract, as are things that cannot be touched. Hospitality goods and services relate to memories and experiences. They are impossible for people to sample or touch prior to arrival. Brochures, Web pages, maps, graphics, and menus may provide a basic idea before a guest makes a purchase, but the actual experience is intangible in nature. After the experience the guest may have only photos, ticket stubs, and receipts to remind him or her of the trip.

More Than an Amusement Park Walt Disney After the success of

Disneyland® Park, Walt ' - *' Disney wanted to create a family destination grander than the Anaheim landmark. He bought acres and acres of land in Florida and started sketching out plans. His dream would be more than an amusement park—it would be an "Experimental Prototype Community of Tomorrow," or EPC0T.

Walt Disney died before his Florida project became a reality, but Walt Disney World Resort lives on as the materialization of his dream. In addition to the Magic Kingdom theme park, Walt Disney World Resort houses three other theme parks, two water parks, hundreds of dining areas, and thousands of hotel rooms. It's a massive complex on 47 square miles of land. Millions of tourists visit every year.

FAMILY MATTERS

Walt Disney World Resort works hard to ensure that millions do keep coming. Disney's marketers Look for tourism trends in their target demographic group and then market to those potential customers. For example, WaLt Disney World created their Magical Gatherings Program in 2003 to tap into the "togethering" trend. Disney executives first saw the trend developing on their cruise ships, where extended-family and friend groups traveled together. Today Disney provides a Magical Gatherings Planner on its Web site. Walt Disney World Resort is a good example of how hospitality and tourism can blend.

What products does Walt Disney World Resort offer?

How has Walt Disney World Resort tried to attract new tourists?

AT YOUR SERVICE Good or bad service determines whether customers return to any hotel or restaurant.

Would you complain if the service was unsatisfactory in a restaurant—or would you simply not return? Explain your answer.

5 Unit 1 The Hospitality & Tourism Business

3. Changeability—In hospitality and tourism, the service provider and guest both play important roles in the success of the service encounter. Thus, service transactions differ from other types of sales transactions. They are subject to changeability, a condition of being subject to change or alteration. For example, if a guest checks into a hotel and is disturbed by someone in the next room, his or her impression of the hotel will change. Similarly, if a guest is greeted by a rude dining-staff attendant, his or her perception of the restaurant will not be favorable. Service training for front-line personnel is essential to eliminate changeability in guest service.

Hospitality & Tourism Today

T

ourism was not common until the late 1800s. However, today's tourism is truly a global industry, catering to every type of traveler. Hospitality is also a global industry that includes a number of important and unique segments. Throughout history, all segments have relied on the importance of service. Future success depends on understanding consumers' needs and preparing for them.

changeability a condition of being subject to change or alteration

A

MARKETING SERIES

Remember to check out this book's Web site for information on hospitaLity and tourism products as well as more great resources at marketingseries.glencoe.com.

8 Unit 1 The Hospitality & Tourism Business

Quick Check

RESPOND to what you've read by answering these questions.

1. What are the segments of the hospitality and tourism industries?

2. What is the difference between goods and services?

3. Identify three variables of hospitality and tourism products.

marketingseries.glencoe.com

Chapter 1 Defining Hospitality & Tourism 9