Electronic Markets in Tourism - Constraints and Opportunities

line reservation networks, known as CRSs or GDSs, extensively used by travel agencies worldwide, many factors have combined to inhibit the development of flourishing electronic markets serving the tourist and the tourism industry. It is certainly true that the airline GDSs provide something approaching a true electronic marketplace in the United States, where 95% of all airline tickets are sold at a discount and the seat has become almost a true commodity. This has been facilitated by the size of the US domestic travel market , its deregulated nature (in stark contrast to the protectionist policies of most European governments), the almost total penetration of the GDSs and the fact that the main distinguishing features of airline tickets (seat location, route, departure details and price) fit the rigid formats of the GDSs' computers. again, paper is their prime medium both for communicating with the tourist and for communicating with each other. Of course, electronic communications are used (telephone, telex, facsimile and now email) but there is no homogenous electronic marketplace in any recognised sense. To date we have only really seen the development of small islands of electronic commerce in the tourism field, for example bed banks, air ticket consolida-tors and late availability holiday specialists. Now, however, the impact of the Inter-net on the public consciousness and the whole Infobahn debate is highlighting the opportunities that low-cost electronic distribution can provide for the tourism industry. The constant media coverage, much referenced at the recent ENTER Conference in Innsbruck, is stimulating the provision of new services as well as interest in the new opportunities for tourism marketeers. With computer technology fast becoming commonplace in the home as well as the office, the potential customer base is also increasing rapidly. Even if they do participate in the existing electronic channels, there are many issues in regard to their use that have to be faced by smaller businesses. The proprietors are often inexperienced in such matters and may make costly errors of pricing or product positioning. A paradoxical result of these inhibitors to electronic marketplace development may well be a strengthening of the role of local and regional bodies, both trade associations and the public sector. There is already a substantial debate about the risk of marketplace exclusion for many destinations. In view of the difficulties that small businesses have in using electronic channels, local bodies are increasingly arguing that they have a …