April 11, 2024

Smart Tourism During & Post Covid-19

 

 

 

 

 

 

 

 

 

 

By:

 

Bassant Ouf

Mohamed Halawany

 

 

 

 

 

 

 

 

 

Abstract

The ongoing pandemic imposed a negative impact on several economic sectors. Through demand and supply shocks, both intrinsic risks and restrictions subsequent to containment measures, are reflected in a sharp downturn within the tourism sector. This contributed to unveil structural deficiencies and impediments to development and transformation. The present paper firstly, investigates the extent to which the pandemic initiated intersectoral socioeconomic loss through behavioural framework. Secondly, discusses the multidimensional role of digitalization in accelerating recovery in the tourism sector. Thirdly, draws lessons from the Singaporean case to highlight concerns and various approaches to policy reformation. Fourthly, proposes an initiative to stimulate information symmetry and digital means of service provision in the tourism sector to maintain sustainable development in the sector under transformational pressures. The paper merely reflects authors’ view and does not necessarily indicate the conceptual parallelism of EUNACR.

 

Table of Contents

Introduction. 4

Behavioural Framework. 4

Digitalizing Tourism.. 6

Lessons from Singapore. 7

Global Concerns. 9

Policy Implications. 10

Proposed Initiative. 11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Introduction

Tourism is one of the main sectors that have been hardly hit by the corona virus and its outlooks are still uncertain. OECD assumed that international tourism has fell by almost 80% in 2020, where areas that highly depend on international, business and tourism events are struggling, as no eloquent recovery in international tourism is foreseen until well into 2021 as it mostly takes many years “70% decline year-on-year in international tourist arrivals in the first eight months of the year, with the loss in export revenues from international tourism eight times that recorded in 2009 amid the global financial crisis. UNWTO now foresees a decline in `international arrivals close to 70%, with recovery to pre-crisis levels not expected before 2023” (UNWTO, 2020).

The Tourism sector in Egypt was severely affected by numerous indigenous and exogenous factors that took place on both the domestic and global levels. the situation continues to worsen as international travel has been further restricted around the world. A complete loss in tourism revenues over the next few months, lasting until the end of 2020 looks increasingly likely (ECES, 2020). Moreover, the Egyptian government has estimated around 1 billion dollars as monthly loss of tourism income, concluding 12.5 billion per year industry with contribution to 12% of GDP, whereas, the tourism cancellation has reached 80% by mid-march compared to the corresponding periods in 2019 with an estimation of 138,000 jobs at risk, such negative repercussions of the crisis on tourism sector were expected to at affect at least 1.4 million people in this sector, as the tourism sector represents 10% of the total employment which makes it the third largest source of revenues after remittances and non-oil exports. Tourism is considered one of the main sectors in Egypt and has a strong linkage to different parts in the economy, although half of the tourism expenditures are on accommodation, food, and beverages (including restaurants) and transportation, while the rest are on other expenses for instance, museums, monuments and buying handicrafts (OECD, 2016).

Behavioural Framework

The present study acknowledges that development in tourism sector requires addressing and investigating the complex intercorrelations between such diverse factors and tourist behaviour to one, assess the potential impact of ongoing developmental strategies in curing omnipresent downturns considering the recent Covid-19 pandemic. Two, propose a modern approach to stimulate tourism activities and accommodate the dynamic exogenous transformations in behaviours and transnational mobility.

According to (Zhang et al., 2014) Tourist behaviour is a substantial determinant within the following aspects: one, choice of destinations. two, evaluation of provided services. Three, intentions of future engagement. (Mathieson & Wall, 1982) divides the phases upon which a tourist undergoes decision making into five phases: First, recognition of the need where a tourist engages in tourism activities because of subjective need. Second, Relevant information collection where a tourist conducts research on the destinations of interest to better behold the surrounding environment. Third, decision making process is deemed to be the phase that incorporates the formerly conducted calculations in making choices of countries and destinations to visit. Fourth, Tourism intercourse accordingly takes place and tourist’s experience plays a substantial role in determining their subjectively perceived utility. Fifth, evaluation takes place subsequently and defines the susceptibility of a tourist to recommend such destinations to friends, siblings, and acquaintances. Practitioners and policy makers need to consider the factors affecting tourist behaviour in assessment of sectoral sustainability in Egyptian tourism. Literature highlights three main factors to contribute to behavioural structuring as well as transformation (Wu et al., 2011). One, individual characteristics such as age bracket, gender, personal conceptions and values, marital status, educational level, occupation, and geographical mobility, which play an important role in making decisions related to tourism activities. Two, specific destination characteristics contribute to persuade/dissuade tourism activities through affecting tourist behaviour. Such characteristics may include, but are not limited to, attractions, relevant infrastructure, availability of specialized facilities, destination accessibility and diversity of provided services. Three, Situational factors may also define one’s behaviour towards such activities where geopolitical relations, climate, cultural and socioeconomic conditions are significant in explaining behavioural changes but since they are situational, their prevalence is not anticipated. It is important to note that a tourist’s intention of commitment to such activity is subject to both their personal (biased) conceptions and information sources (unbiased). In this sense, (Beerli & Martin, 2004) attributes vast importance to information sources rather than personal conceptions in shaping and defining tourism choices. Therefore, one can interpret the substantiality of monitoring and supervising the availability and ease of access to credible, transparent, and up to date information about tourism destinations as well as political and socioeconomic environments. An important multidimensional aspect is deemed to be the perceived risk associated with tourism activity since it modifies the tourist’s situational assessment and intentions (Karl & Schmude, 2017). For instance, a tourist is expected to avoid risk-entailing decisions under the notion of Cognitive Dissonance which is a psychological state that takes place due to the inconsistencies accompanying divergent perceptions of specific decisions (Menasco & Hawkins, 1978). Accordingly, Cognitive Dissonance transforms one’s behaviour in a way that aims to hinder negative consequences attributed to specific consumptive patterns as well as moderating one’s intrinsic motives to undergo tourism activities. Worth noting is that risk has a differential implication of its exerted influence on behaviour where the notion of risk-aversion exists at different degrees among humans. Some humans seek risky outcomes while others do not. However, (Wolff et al., 2019) discusses the impact of perceived risk on exacerbation of anxiety defined by (Gudykunst & Hammer, 1988) as the fear of adverse consequences. Safety and security levels exert a chief influence on decision making and intentions of engagement in tourism activities (Reisinger & Mavondo, 2005), (Novelli et al., 2018). Empirical evidence provided much support to this lineament as Leggat et al. (2010), discusses the depressing impact of 2009 H1N1 influenza virus on global tourism arrivals where reduction ranged between (4% – 5%). More recently, (Bakioğlu et al., 2020) examined the intercorrelation between the fear of COVID-19 and psychological anxiety. Findings advocate a positive relationship where people consistently exposed to news about the pandemic are more prone to suffer from inclined rates of anxiety that primarily depends on acquired information. Hence, development in tourism sector involves the continuous supervision of information related to tourism destinations and provided services to falter the impact of behavioural biases, associated with information asymmetry, on tourist’s decisions and choices following the conceptual conclusion of (Koo et al., 2016).

Digitalizing Tourism

Digitalization is simply anywhere technology and driven data management are being transformed in our social and economic systems, and lives. Pushing towards adopting digital technologies are driven by converging advanced technologies and boosting social and economic connectivity, considering globalization; as digitalization has the potential in increasing innovation, generating economic and environmental efficiencies and uplifting productivity, included in the highly globalized tourism sector. (OECD, 2017a). There is a variety of aspects influencing the usage of digital technologies on the national and international levels, as in example, the social and demographic characteristics; the political context; legal frameworks; geophysical environments; availability of/access to/awareness of different technologies; the economic conditions that shape confidence in investment and the effects on the marketplace. Such aspects play different roles in different destinations, and sub-sectors of tourism, uplifting “multi-speed” processes of digitalization. The design of policy initiatives should consider these aspects and not to seek only adopting “one-size fits all” solutions from other destinations.

Recent research undertaken by the European Commission found significant differences in the uptake of digital technologies in tourism across Europe. Additionally, it was found that tourism SMEs lagged large enterprises, meanwhile, basic e-marketing and e-commerce were widely adopted, using advanced technologies such as data analytics, cloud computing and geotagging had received only limited uptake (Dredge et al., 2018). Adding to that, the consumers have been increasingly using digital technologies to search and book travels, making it incredibly important for tourism businesses to integrate digital technologies and leverage advanced capabilities.

Despite of such uneven uptake of digital technologies by tourism SMEs, the digital transformation has vibrant and profound impact on tourism. The digital economy is transforming the process of communicating with tourists and marketing tourism services and opening new and highly creative ways of delivering tourism services and enhancing the visitor experience. It is changing the way work is organized and services delivered and presents opportunities to take advantage of digital advancements to manage transactions, capture and process information and data on tourism supply and demand, and improve and connect operations along tourism value chains and ecosystems. moreover, advancements in technology are believed to have deep impacts on tourism sector where they range from business management technologies as (mobile technologies/cloud computing, automation and advanced robotics, blockchain, data analytics) to technologies that lead to innovation in the tourism services, experiences and products as virtual/augmented reality, Internet-of-Things; and lastly, technologies that help in assisting, understanding and connecting with markets as in data analytics and artificial intelligence (OECD, 2017c), which means that on the long run, these digital transformations can enhance innovation and create competitiveness within the region. Hence, it is recommended to recognize the tools, frameworks, and technologies of digitalization to develop and add value to tourism products and tourists’ experiences, which can only be satisfied if it is built in a strong tourism sector.

Lessons from Singapore

The pandemic imposed a vast challenge on global policy bodies to accommodate the drastic downturns sighted within several economic sectors such as the tourism sector. The respective sector was severely impeded because of global virus-containment measures, cessation of several tourism activities, bounded geographical mobility and recessionary pressures that had almost depressed international tourist arrivals by 70% during 2020 according to the UNWTO, with a loss in revenues transcendingly in value as the loss that took place after the global financial crisis. Economic practitioners, beyond, are certain of a lagged recovery that is expected not to trigger before 2023. The tourism sector has a significant contribution to economic well-being through abundant employment generation and voluntary inflows of foreign capital. Although the downturn delayed expectations of economic prosperity, it did, in fact, undercover the necessity of curing systematic deficiencies within the affected sectors through inducing innovation, incorporating digital technologies, intensifying the economic interlinkages between market participants, and more importantly, promoting green sustainable development within the tourism sector. From 2019 to 2020, Singapore’s foreign visitors dwindled from 1.5 million to 2000 visitors according to STB (Singapore Tourism Board). Government agencies were concerned about the severity of the situation considering the global pandemic. It was necessary to reduce vulnerability of the tourism sector and initiate sustainable development reflected by numerous initiatives of accelerating digital transformation in the sector and sustaining the unimpeded flow of significant information to & from participating enterprises.

“The reality is that we’ve been transforming for a number of years, what we want to do during this very difficult period is to try to accelerate that transformation.”, Said Quek Choon Yang, STB’s chief technology officer

The Singaporean approach to correct systematic imbalances in the sector and embrace a sound transformation, was based upon three important phases:

  • Learning
  • Testing
  • Implementing

Within the first phase, participants in the sector are required to perceive their different weaknesses and strengths to commit developmental measures. The STB pursued such goal through establishing TTI (Tourism Transformation Index) in April 2020 which accordingly played a huge role in diagnosing deficiencies and communicating potential possibilities of improvement in the tourism sector. In addition, an analytical data platform, namely, STAN (Singapore Tourism Analytics Network) was established for stakeholders in the tourism sector to transparently access and share important data related to the industry. Being well-informed, the associated businesses are deemed to undergo more responsible planning and make effective decisions. The second phase aims to provide low risk environment for innovators to evaluate the feasibility of their proposed ideas and solutions before implementation to ensure minimal economic losses. In this sense, the Three House project was established as a working space dedicated for businesses in the tourism sector to discuss their innovative ideas and collaborate in planning means of recovery, and through STAP (Singapore Tourism Accelerator Programme) participants are assisted in conducting potential investments. The third stage encapsulates multidimensional improvement in the tourism sector wherein inclusive development and growth are attained through two distinguished channels:

  • Demand-side channel
  • Supply-side channel

On the one hand, promoting tourism through demand-side advocates enhancing visitor’s experience where a positive influence on tourist arrivals is subsequently estimated. STB managed to achieve such notion through reinforcement of technological advancement and integration of internet-based technologies in the sector. Several attempts to facilitate tourism activities, such as Alipay non-cash online payment technology, unified e-ticket passes and incorporation of augment reality in online marketing campaigns, were crucial in stimulating tourism and restoring tourists’ confidence.

On the other hand, it was also important to develop the supply-side since projections of accelerated digital transformation might leave small businesses incapable of maintaining their operational capacities. Accordingly, the STB attributed importance to digital training and online educational practices aimed at improving human capital in the tourism sector and adaptiveness to advanced mechanisms of service provision. The STB Marketing College established several partnerships with internet giants such as Facebook, Google, and LinkedIn to assist in revolutionizing the digital comprehensiveness of the new mechanisms implemented in the tourism sector as well as orienting personnel with the realm of internet-based technologies and key skills through resorting to Google’s SME Leadership Academy Programme that focuses on small and medium enterprises engaged in tourism activities to pertain adaptiveness and effectiveness in the sector.

Global concerns of pandemic-associated socioeconomic effects

  • Conventional containment measures and mobility restrictions impose a negative effect on sustainability of tourism sector and subsequently may depress aggregate employment.
  • Tourism sector operates in correspondence with several other sectors to which losses are indirectly transmitted.
  • The economic effect is both sector-specific and broad in the sense that aggravates risk.
  • Continuous government support is required to accelerate recovery, underlining the pandemic-associated fiscal burdens due to prevalent limited fiscal imbalances and structural deficiencies in developing regions
  • Extensive research and data analyses are required to ensure information symmetry and proper evaluation of the efficacy of ongoing initiates.
  • Clarity of agendas, objectives and trajectories embodied in the policy framework. In addition, proper policy communication promotes efficiency of transmission mechanisms and is accordingly substantial in recovery phase.
  • Addressing structural deficiencies and protecting sectoral transformation may play an important role in developing economies.

Policy Implications

  • Sustainability approach
  • Incentivization of domestic investments in green, digital, and advanced tourism-integrated technologies
  • Facilitation of innovative practices within the tourism sector
  • Maintaining market competitiveness and restricting predatory monopolistic privileges
  • Targeted and accessible supports to fragile businesses and workers

 

  • Institutional approach
    • Comprehensiveness of policy framework to address sectoral deficiencies
    • Alleviation of regulatory restrictions and/or bureaucratic practices associated with the tourism and hospitality
    • Flexibility and adaptiveness are anticipated to falter inequality between the directly and indirectly affected entities

 

  • Human-capital approach
    • Reinforce educational programs aimed to improve labour skills and technological orientation.
    • Pave the way for unrestricted interborder flow of technology and expertise
    • Promote youth’s awareness of, and involvement in green innovative practices in the tourism sector
    • Maintain information symmetry within the tourism and hospitality labour markets

 

  • Behavioural approach
    • Enhance Tourist’s personal access to important information through online platforms
    • Widen service outreach and destination accessibility
    • Maintain a safe environment and strict cybersecurity for vulnerable businesses and customers
    • Ensure transparency and proper communication of projections and policy objectives
  • Collectivism approach
    • Promote international partnerships with internet-based companies
    • Maintain cooperation between the private sector and state apparatus within politically independent resolution schemes
    • Monitor and restrict mal-practices and term violations

Proposed Initiative

A mobile application that promotes an accelerated sustainable development within the tourism sector amid the global crisis. Through three channels, the proposed application will facilitate symmetric information flow across interested parties in a manner that endorses well-informed activities and exceptional visitor’s experience.

  • On the demand-side, Visitor will be exposed to information regarding various destinations and services provided in the region as well as updated prices.
  • On the supply-side, businesses involved in the tourism sector will be informed about the dynamic needs and concerns of tourism customers, to enable such businesses to scrutinize flaws in the industry and undergo well-informed adequate responses
  • On the monitoring-side, the application utilizes feedback mechanism to highlight deficiencies, and issues experienced by visitors and recipients of tourism, hospitality, and financial services to constrain mal-practices and retain visitor’s safety.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

References

 

Bakioğlu, F., Korkmaz, O., & Ercan, H. (2020). Fear of COVID-19 and positivity: Mediating role of intolerance of uncertainty, depression, anxiety, and stress. International Journal of Mental Health and Addiction, 1-14.

Beerli, A., & Martin, J. D. (2004). Factors influencing destination image. Annals of tourism research, 31(3), 657-681.

Dredge, D., Phi, G., Mahadevan, R., Meehan, E. & Popescu, E.S. (2018), Digitalisation in Tourism: In-depth analysis of challenges and opportunities. Low Value procedure GRO-SME-17-C-091-A for Executive Agency for Small and Medium-sized Enterprises (EASME) Virtual Tourism Observatory. Aalborg University, Copenhagen

ECES (Egyptian Center for Economic Studies). 2020. Views on Crisis. Impact on the Tourism Sector in Egypt. Issue: 3. Cairo: ECES.

Gudykunst, W. B., & Hammer, M. R. (1988). The influence of social identity and intimacy of interethnic relationships on uncertainty reduction processes. Human Communication Research, 14(4), 569-601.

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