The Electric Commerce In Hotel Industry Marketing Essay

In Hospitality and Tourism industry, hardware, package, information direction, and telecommunications systems have allowed for the processing and information flow amongst organisations. The manner in which touristry organisations take advantage of IT tools may find their hereafter success in the market place [ 4 ] . We consider the importance of the tendency of Information Technology by implementing an effectual IT system for advertisement, distribution, encouragement and co-ordination of the industry. It is of import that Hotel Industry take the lead of the emerging engineerings to better direction abilities and develop concern programs concentrating on the most efficient income of presenting value added merchandises to clients. In this regard, touristry associations will be able to maintain an aggressive advantage over those who are non using this yet.

Electronic commercialism ( known as e-commerce ) is a wide look that is used to depict the actions of concerns or commercial organisations. It included interaction and dealing that occur via telecommunications media to supply map, production or service to others. It allows for information to be streamed via web such as Internet on a world-wide footing virtually. The e-commerce way is a benefit to all parties over the universe in most industries since it is cost nest eggs.

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E-commerce includes all concern maps that may be processed over Internet, Intranet or Extranet in any industry. In General, there are four types of interaction on e-commerce minutess may happen.

B2C minutess involve business-to-customer interactions. For illustration, air hose reserve system ( Busiess ) allow people ( Customer ) do on-line reserve of air ticket.

B2B minutess involve business-to-business. For illustration, a engagement of a hotel room via Travel Agency system, where the Travel Agency is a concern that pre-purchases blocks of suites from a given hotel ( another concern ) for sale to others at lower monetary values. The agreement between Travel Agency and the hotel is a B2B dealing, whereas if person interact as an on-line client of TA system, which is a B2B2C dealing.

B2E minutess involve a concern and its employees. For illustration, provides an electronic system for flight mechanics to order replacing parts for aircraft called INIRN, which stands for “ I Need It Right Now. ” In this instance the concern is supplying an electronic service for its employees.

C2C minutess involve two or more consumers ( customer-to-customer ) . eBay or TaoBao are some illustrations of a concern that provide a web platform for client to make concern with another clients.

Technical constituents of e-commerce

Most of computing machine webs consist of 3 major countries: the front terminal and the back terminal and Firewall.

Front end – User interface for e-commerce terminal users, including employees, clients, and concern affiliates.

Back terminal – Contains interfaced constituents developed to supply e-commerce services or merchandises to stop users.

Firewall – Filters all web traffic to supply a secure information transportation on a web and transmittal to other webs.

To be competitory in cordial reception and touristry industry, they must follow the Internet tendency for future long-run growing and competitory advantage. However, before implement e-commerce, one most of import thing to be considered on cordial reception and touristry organisations is the nucleus concern in this industry involves to dwell chiefly of interactions ( guest dealingss ) with clients and physique of memorable experiences F2F ( face-to-face ) . So the minutess of on-line reserve of Hotel room or eating house simply satisfy basic client outlooks

Hoteliers should hold visions of air hoses, hotels, sail ships, eating houses, wellness watering place, golf, concert, and the similar, based on their single experiences. Interactions include the relationships that take topographic point during each dealing.


Fact / Hotel operation /

The industry can do net incomes to many states and draw foreign currencies into the state. Consequently, touristry market place has quickly grown. World Tourism Organization ( WTO ) estimates that over 1.5 billion tourers would take international journeys in the twelvemonth 2020. Europe would still be the most popular tourer topographic point. Second to Europe, Asia Pacific would welcome up to 397 million tourers. The growing rate is mean as 6.5 % per twelvemonth [ 1 ] .

( Electronic Commerce Resource Center ( 2000 ) . “ Electronic Commerce for Thai Tourism Industry ” . Bangkok. )

The Internet is non the full solution to success in the Hospitality and Tourism industry. However, the Internet is the “ overall concern reply ” across industries. The rise in travellers over the clip has besides driven IT demand on offering high quality merchandises at low costs to the clients. The success of the Hospitality and Tourism industry will depend upon the abilities to place and reply rapidly to current and possible client demands. IT is playing a major function in “ service ” clients. This challenges Hospitality and Tourism organisations because efficiency in both external and internal interactions are required. The apparatus cost of IT may be rather expensive in a economic sense, and the enormous cost nest eggs in the long-run will depend upon the efficiency of the IT during its important execution phases. In some manner, Hotel could cut down the cost such as the committees paid to go bureaus as providers will be straightly linked to clients.

Starwood Hotel Group was standing in front of other Hotels to offer a online “ practical Tours ” of its belongingss. This characteristic provides a site visit to possible invitees without holding to go to each belongings. And now, many well-known hotels are besides supplying this publicity characteristic for base top of the functions to pull possible clients.

The tendencies of Hotel web sites are designed with many exposure artworks that allow visitants to inspect the installation, anteroom, evidences, guestrooms, and comfortss visually. Many hotel web sites besides provide superior multimedia presentations designed to give practical Tours of the installations to possible invitees, utilizing streaming pictures and 360-degree screening platforms of the belongingss.


Google presented the vision of Internet selling is likely to turn by 2015. Some of them are deserving to be informed and cognizant about.

50 % of ad runs will include video ads bought on a cost-per-view footing

50 % of ads will be bought utilizing this real-time command engineering to orient experiences for different viewing audiences

Smartphones / nomadic phone will be the figure one screen for digital trade names to prosecute users

There will be at least 5 prosodies that advertizers will see as more of import than the “ chink ”

75 % of web ads will be “ societal ” in nature such as facebook. Therefore, Ads will be shared, discussed, subscribed to and urge

Multimedia formats enable great creativeness and interaction – these will turn from 6 % of show ad feelings to 50 % , particularly for trade name edifice runs

Digital show advertisement is traveling to turn to a $ 50 billion industry

This prognosis shows that competition to pull possible clients via world-wide web will be more and more drastic.

Changing of e-commerce in Hospitality and Tourism Industry

Customers feel empowered to set up their ain paths for air hose, hotel room, transit and other travel comfortss straight via the Internet. It is predicted that the cyberspace will take the bulk of reserves straight from clients and mediators at a part of the costs associated with today ‘s around 800 figure and Global Distribution Systems ( GDSs ) [ 20 ] .

The travel distribution system is presently confronting many alterations as online bureaus such as Priceline, Travelocity, Expedia, etc. have introduced a manner to entree travel providers straight via the worldwide web. In general, Global Distribution Systems have non shown much of an attempt toward aiming online clients. As an option, Customer Relation Systems have remained trusty to their travel bureau distributers.

Traditional Travel Distribution Channels

The traditional travel distribution channel works where the clients contact the travel agent or direct merchandising channel to book their full holiday or concern travel. Statisticss indicate that travel agents manage 80-85 % of holiday packaging [ 22 ] . However, from the beginning of popular in engineering and the worldwide web, these figures are altering. Buying tickets on-line via air hoses will go on to rule the travel market. A major challenge for air hoses company, other providers and travel bureaus is to promote clients to make the online booking for their travel bundles. They must go on to add value to maintain clients satisfied by offering traditional plans, acknowledgment, service, and other wagess that keep them coming back for more. When it comes to viing straight with the major online participants such as Priceline, Travelocity, etc. , air hoses and other providers have an advantage because they have all of the loyal clients, trade name acknowledgment and big call centres that online bureaus do non possess.

Airlines have a stronger consecutive nexus to clients as they compete straight against travel agents [ 23 ] . Furthermore, they could hold stronger control over the clients due in portion to the e-ticketing. In this regard, online engineering has replaced the travel bureau by adding value via menu shoppers, publicities, and individualized recommendations. Although travel bureaus have maintained market portion, they must strategize to go either a niche rival or a big participant in the changing concern state of affairs.

Another e-Commerce theoretical account such as Auction style-pricing theoretical accounts are going client penchant, where the client are able to command the monetary value of the merchandises and services to be consumed. Meanwhile, suppliers still keep clasp of control over the concluding footings of the dealing and can use mechanisms such as Priceline to assist unclutter the market of unsold stock list. Travel auctions such as Priceline have become the popular in offering the best monetary value for hotel bundles. Since clients are concentrating on monetary value as a chief factor in shopping for travel bundles, on-line auctions such as Priceline are a considerable menace to the hotel stigmatization system and the industry in general. The future distribution channel calls for service suppliers, providers, and clients all linked up together in an incorporate environment.

Customers are about guaranteed that they will obtain the best monetary value by negociating via an on-line agent such as Priceline. But a defect to all of this is that the client will non understand all of the normal benefits of air tickets as they are sacrificed via on-line auction purchases. For illustration, in many instances the travel ticket does non allow any alterations or accrual of or without important punishment charges.

Many clients have made Travelocity their on-line holiday contriver. Sites such as Travelocity offer real-time, online reserve capablenesss for unsold stock list and holiday bundles. By tracking clients on the Internet, on-line companies can make profiles of possible clients in specifying their mark markets.

Expedia cooperate with Yokel!

Latest intelligence about Expedia in Europe that introduces Expedia ‘s travel engagement and packaging engine on Yokel! The combined strength of the corporation brings users both inspiration of Yahoo! ‘s content and the capableness to polish this option harmonizing to their penchants and book with confidence that you are doing the right pick by look intoing their pick with a assortment of function options, reappraisals from old Expedia clients and referees ‘ exposures.

Obviously, clients use assortment of online tools and sites while be aftering and researching their trip. Organization such as Expedia and Yahoo! are seeking to do that procedure every bit simple as possible for travellers, to pull more clients to entree their web site.

The online travel infinite has seen a assortment of new developments over the last decennary and these are really interesting times in the online travel universe. There ‘s ever been a close relationship between travel and Search and there are a figure of chances which this presents for coaction such as Yahoo and Expedia. Another illustration for that is Expedia launched a new service which utilizing Google ‘s Street View engineering to offer users to see the hotel exterior and take a practical walk around the hotel country before booking with Expedia.

Small travel bureaus should be needed to develop an advanced, appealing, attractive, and fast web-site in order to be survival.


The Internet selling Asiatic part is still quite immature. There is non every bit much of an on-line menace to go agents and mediators in Asia compared to the Europe. Ctrip and Asia Travel Mart are known as the celebrated online travel reserve Internet-based engagement system in Asia. They offers a secure engagement system for world-wide hotels, Tourss, transportations, repasts, auto leases, travel insurance via its web of providers.

Now that the menace is obvious, possibly cordial reception and touristry companies in Asia can take advantage of the Internet and derive an border on rivals.

In general Asia is presently sing some challenges in the e-commerce revolution, particularly on the B2C country due to the atomization of the market. Park ‘n Shop and Welcome supermarket ironss are some illustrations of successes have been a Hong Kong company called which sell on-line food markets, and Octopus card are more and more popular applying in our life in Hong Kong for paying nutrient, conveyance and amusements.

Online companies have more of a opportunity at success in Hong Kong due to the dense population, strong instruction systems, high recognition card and cell phone use. This leaves room for the hereafter development of the following Priceline or Travelocity in Asia which could present a major menace to cordial reception & A ; touristry organisations. Based on the high volume cell phone use in Hong Kong, Mobile commercialism should be a new tendency on following phase. [ 29 ]

Provide service like nest eggs on travel, artworks and finish ushers, advice, intelligence, exchange rates, conditions forms, and flight agendas supplying a full web experience signal for Asiatic organisations, travel agents, and mediators to reassess their long-run schemes [ 30 ] .

The Future Role of Travel Agents

The growing of the Internet concerns leads to the topic of what will go on to online travel agents and mediators. How they can go on to add value to clients?

As low cost computing machine real-time informations, fast speed cyberspace entree, voice and picture communications become a world, travel bureaus may no longer be needed. On the other manus, the Internet challenge can besides intend opportunity. Hotel proprietors and operators who understand and master e-commerce or m-commerce challenges will be able to leap in front of on-line menaces from big participants such as Priceline. Otherwise, many will happen themselves out of concern.

Langham Hotel International is one of the Hotel groups which are seeking difficult to stand on top of modern hotels with high engineerings in acknowledgment to the universe. They has launched an application on Apple shop on last twelvemonth for royal members offering, on-line reserve for all belongingss over the universe, and some tools have been integrated on the applications for public usage. And late, Langham Place Hotel Hong Kong has completed a redevelopment on their invitee suites and equipped some iPhone4 on those suites. The invitee could hold limitless local call and 3G Internet entree on the nomadic device during the stay. Meanwhile they have release some iPad apps such as a eWine list, iMenu for eating house usage in order to pull more invitee for purchasing their service and merchandise to increase the income via Technologies.

Information Technology tools have allowed travel mediators to spread out their function in the industry by showing chances to venture into other markets on a geographical degree.

The concern traveller seems to be the figure one mark for hotelkeepers who are concentrating on the Internet tendency Most of the hotels mentioned antecedently are offering online services specifically to suit concern traveller demands. Hoteliers should able to supply customized services for single invitee and keep good client relationship with invitees.

Not merely should hotelkeepers concentrate on the concern traveller, but they should besides see whether there are other types of possible mark clients as we may happen that both immature and older coevalss were sitting in the Internet stores using on-line services during their holiday as good.

Cordial reception and touristry organisations will hold to be up on all of the latest engineering, in order to recognize a competitory advantage in the market particularly in the long-run. One major challenge for all on-line travel companies is in measuring how their mark clients are utilizing their computing machines.

Young coevals will use their computing machine otherwise from a 40 year-old or even a 60 year-old traveller, the best manner is to place their mark prior to marketing/selling their products/services online

Primary Constraints of the e-commerce in Hospitality and Tourism industry

Organizations have to put in the expertness and equipment ( Hardware, Software ) for constructing a strong IT base at first.

As Involved in the reserve procedure: room reserve dept. , cardinal reserve system, feast dept. , eating houses, watering place, golf classs. The operation and system complexness is hard to develop.

Internet security has been a major issue environing the Internet community. There is an eternal sum of information go throughing via on a world-wide footing. And on-line payment may affect recognition card information over the Internet. Hacker may try to assail these waiters to obtain recognition card information for illegal usage.

Governments are presently turn toing Internet based planetary commercialism by sing regulations of behavior, steering rules, Torahs and revenue enhancement

Some of companies have an advantage in support, leading, low channel struggle, organisation and engineering accomplishments while traditional companies have the trade name and clients base. Although Dot com companies seem to rule in this sense, traditional cordial reception & A ; touristry companies have the capablenesss of coming out on top if they opt to venture online [ 35 ] .


Today, hotels are administering their merchandise via more and more channels. How they keep control of handiness and monetary value, keep a consistent degree of client service, plus maintain their distribution spouses up to day of the month at the same clip has becomes a complicated and expensive procedure. Major companies have gone to a distance to develop new schemes for viing in the online environment. These schemes differ widely from selling suites online, supplying clients with better online client services, maintaining path of the single client likings to developing the best client trueness wages plans. For major hotel ironss, E-commerce does n’t merely intend selling merchandises from an on-line portal but developing a strong relationship with the other travel spouses in order to guarantee the wider scope of installations for the varied traveller profile. It besides means providing a travel merchandise to tour operators and the demand to cognize which operator has the scheme and distribution power to sell their merchandise online.

The nucleus minutess of our concern affect intimate face-to-face interactions, which have certain restrictions in respect to the usage of e-commerce in the cordial reception industry compared with other endeavors

Although the chief telecommunications nexus for e-commerce is the Internet, private webs such as extranets and intranets are besides portion of the e-commerce landscape. The major maps of B2C, B2B, and B2E e-business include direction information systems and the selling, accounting, human resources, and operations sections

The cordial reception & A ; touristry Internet hereafter foremost calls for a user-friendly platform incorporating a broad scope of services that fit all client involvements. Web clients are looking for the ultimate experience when browse via the Internet. A professional web in writing interior decorator is an option for companies necessitating aid in making an advanced attractive web-site that will entice clients into the web travel experience of a life-time. A travel site that is speedy, user-friendly, and includes province of the art artworks will turn out attractive for web clients [ 36 ] .

Now is the clip for cordial reception companies to take advantage of the chances available in making a new value added customized online travel shopping experience for clients. The ultimate tendency calls for something comparable to the shopping-bot. For those who are non familiar with the shop-bot construct, it is meant entirely for on-line vesture shoppers who prefer to hold a personal agent. Similar to the shop-bot, the hereafter of the Internet in the travel industry will supply a travel bot who will play the hand-holding travel agent for those that require the most counsel in set uping their travel programs. This travel bot will make a usage experience that suits the peculiar client demands offering a scope of services including hotel suites, eating house tabular arraies, air hose seats, and rental autos. The travel bot will supply advice and recommendations as presently found on GDSs [ 37 ] .

It is of import to take a expression at how Internet engineering will consequence the hereafter of the touristry industry. Most IT tools are being utilized. However, there is still much room for betterment in velocity, dependability, and version to new engineerings. It is important for companies to take advantage of the Internet before the competition. A solid R & A ; D map is one of the elements in this procedure. It is pertinent to analyze the clients and their concerns by promoting them to make full out a clients profile signifier on the web. As an inducement to make full out this signifier, a company may see offering to supply a service or wages to the clients in return. In order to maintain up on the altering engineerings, keeping or subscribing to a information or informations tendency bank is a cardinal option for cordial reception & A ; touristry organisations. The procedure of turning informations into cognition can be found via working with such companies as Horwath, Smith Travel Research, PWC and PKF confer withing [ 38 ] .

It is of import to see how technological drivers will act upon alterations. Many traditional little and big participants in the industry are holding a hard clip seting to the alterations involved in exchanging to a full IT based scheme. This is chiefly due to the extent to which the Internet changes how cordial reception services and comfortss are delivered. It farther alters the organisational constructions within cordial reception companies and modifies the interaction of the client and service supplier.

The cordial reception & A ; touristry cyberspace hereafter suggests a universal system where belongings direction systems will extinguish the demand for expensive on-site computing machine hardware/software. The care jobs associating to breakdowns, backups, and ascents will be resolved in an easy efficient mode. The Internet will command all minutess affecting recognition card mandate, travel agent committees, and point of sale minutess. This will ensue in fewer jobs, a lessening in staff and an addition in net incomes. The typical hotel invitee will hold the option of choosing films, games, package, shopping and information via voice communicating and data/video, all available at a low cost [ 39 ] .

Future success for cordial reception & A ; touristry companies depends upon their abilities to place a mark market and the strategic chances available for endurance and growing. If informations is managed decently, the engineering can help hotelkeepers and restauranters in projecting the life-time value of invitees, making increased trueness, ensuing in an addition in market portion. The procedure of mass production has ne’er been accepted in the touristry industry, hence customized services are a must for endurance. Today ‘s computing machine universe allows for mass customization in pricing, location, and comfortss to a more knowledge-based format. In this instance, selling and IT departments must work closely toward a amalgamation of nucleus competences. The thrust toward e-commerce success includes a program to track surfboarding and ingestion wonts such as the purchasers, remunerators, and the return visitants. Independent advisers are available to supply this information expeditiously and confidentially.

It is important for cordial reception & A ; touristry organisations to remain on top of the functions of the major online participants that are presenting a serious menace to the industry such as Travelocity, Priceline, Expedia, Yahoo, etc. Their function in the hereafter of cordial reception & A ; touristry selling is important to the endurance of Hoteliers. Hospitality & A ; touristry organisations might desire to look into the potency of going one of the first movers to fall in the point com fad. The already established loyal client base will let cordial reception & A ; touristry organisations to hold an upper-hand over general online menaces.

The customized travel bot could supply the ultimate travel experience of a life-time for clients in adding the most value, therefore leting first movers in the industry to derive an overall competitory advantage.



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