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`Harold E. Lane
`
`Professor Emeritus, Boston University '
`
`Denise Dupré
`CEOw&¢éLfll
`
`@
`VAN NOSTRAND REINHOLD
`I®P® A Division of International Thomson Publishing Inc.
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`Starbucks V. Ameranth, CBM2015—OOOfl
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`5
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`Nostrand Reinhold
`Copyright © 1997 by
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`12345678910 QEB-FF 010099989796
`
`Library of Congress Cataloging-in-Publication Data
`Lane, Harold E.
`
`Hospitality world: an introduction I Harold Lane and Denise Dupré
`p.
`cm.
`ISBN 0-442-00118-5
`
`1. Hospitality industry—-Management.
`II. Title
`.
`TX9l1.3.M27L363
`1996
`647.94'068--dc20
`
`I. Dupré, Denise.
`
`96-8345
`CIP
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`
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`Understand the universal truths about tourism.
`
`Understand the impact of tourism on intemationalidevelopment.
`
`Explain how the elements of hospitality are intertwined in
`tourism.
`'
`'
`
`rs9° Be able to define tourism.
`
`Be able to name the variety of activities that can comprise
`tourism.
`
`Be able to name the major travel distribution channels and
`
`understand how they operate.
`
`Understand the components of transportation, and its effects on
`tourism.
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`What is Tourism?
`Establishing a Definition
`If we tried to define tourism in short form, here’s some of what we’
`
`
`
`comprise tourism to have a purpose. But for how long do people need to be away, and how far do
`they have to go, and for what purposes, before we call them tourists? The League of Nations———whicli
`established its definition of a tourist in l937——thought 24 hours away was enough, unless the
`tourists were on a sea cruise, in which case fewer than 24 hours were acceptable! They didn’t com-
`ment on distance, but traveling for pleasure, to meetings, or for business were acceptable purposes
`to classify someone as a tourist. Today, the National Tourism Resources Review Commission con-
`siders a tourist someone who travels at least 50 miles for business, pleasure, or any other purpose
`except to commute to work, whether the traveler stays overnight or not. In Canada, to be a traveler,
`you only have to travel 25 miles. According to the United States Census Bureau, a person must go
`at least 100 miles, whether or not the trip involves a stay overnight out of town.1
`
`Multiple Pieces
`The moving about of tourists, who are travelers away from home and require the services the hos-
`pitality industry provides, is what defines the tourism industry. The person still must travel to get
`there, and thus all the different types of transportation are a part of tourism. The traveler may use
`some kind of travel distribution channel to gather data before departure. A travel distribution
`channel is the method the traveler chooses to get from point A to point B. Thus travel agencies and
`tourism offices are also a part of tourism. Once away from home, the traveler must be serviced by a
`variety of businesses. Among these businesses, which are included as a part of tourism, are lodging
`and foodservice establishments. Upon arrival to a destination, a traveler may also be entertained by
`various types of attractions, recreational activities, and special events.
`
`Multiple Perspectives
`Tourism can be viewed from various perspectives, each with a special concern about tourism From
`.
`.
`.
`.
`.
`.
`'.
`.
`.
`an economic perspective, tourism involves all the receipts from these businesses, including foreign
`exchange and tax receipts, capital expenditures, the employment payrolls ofeveryone who works in
`these businesses, and the multiplier effect of these monies. For example, The multiplier efiect
`means that when a taxi driver drives a traveler from the airport, the payment for that service is spent
`by the driver in the community; the effect of the payment for one taxi ride has a multiplied effect
`on the economy. From a sociological perspective, tourism involves the study of leisure activities and
`the habits and customs of hosts and guests. From an environmental perspective, tourism involves
`land use and ecological impact. Other disciplines offer other perspectives: anthropological, psy—
`chological, cultural, historical, and legal. The complexities are vast.
`
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`There are some universal truths about tourism: It is _an important part of the economy for nearly
`every developed nation in the world, and of potential importance to undeveloped nations. It is also
`big business. Companies that constitute tourism are the world’s largest generators of jobs.
`
`Arrivals and Receipts South Asia, Africa, the Americas, East Asia and the Pacific, the
`Middle East, and Europe each express their international arrivals in thousands and their receipts
`in millions (of dollars, currency exchange adjusted). Arrivals are simply the people who enter the
`country as travelers, with the intent to leave within a specified time frame. Receipts are defined as
`the funds spent by the traveler in the country of destination. As illustrated in Table 5.1, in 1993,
`the total arrivals in the world were nearly half a billion. The world’s tourism receipts were over $300
`‘ billion dollars in 1993.
`Wilrid15' Top Employer According to the World Travel and Tourism Council, tourism is the
`
`world’s number one employer, employing more than 200 million people worldwide. By the year
`2005, the number may reach 350 million. Worldwide, one job in every nine is a part of travel and
`
`tourism. In some parts of the world, the ratio is even more staggering. In the Caribbean, Belgium,
`Luxembourg, and Portugal, for example, the ratio is one out of every six jobs?
`
`Tourism is Growing
`Tourism, as measured by international arrivals, has grown and continues to grow at remarkable
`
`;rates. In 1950, there were 25 million international tourist arrivals; by 1960, the number more than
`doubled, jumping to 69 million. By'1970, the number more than doubled again, to 160 million
`-alfivals; by 1980, there were 285 million and 1990 scored 443 million. Projections indicate that the
`
`lumber will continue to grow to the close of the decade in the year 2000.3
`
`m____._ Table 5.1 Arrivals and Receipts
`1993 Arrivals
`1993 % Share of
`{in thousands)
`World Total
`
`
`
`1993 Receipts
`(in million U.S. S)
`
`1993 %Sl1are
`of World Total
`
`14,000
`
`100,000
`74,000
`
`288.000
`
`6,000
`
`4 5
`
`21
`9
`
`63
`
`3
`
`$4,200
`
`$33,552
`$56,005
`
`$156,955
`
`$6,659
`
`'
`
`1
`
`23
`18
`
`51
`
`2
`
`
`
`
`lAnnua,ire des Stcttisriques ciu Tourisme, World Tourism Organization, Madrid, Spain, 1995.
`
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`Review of Component Parts As we saw in chapter 1, the entire world of touris
`thought of in five major categories:
`
`mean
`
`1. Lodging
`2. Foodservice
`
`3. Entertainment
`
`4. Travel Distribution Channels
`
`5. Transportation '
`
`
`
`In sections 2 and 3 of the book, “Places to Stay” and “Places to Eat,” we will cover lodging and
`foodservice in detail. In the remainder of this chapter, we will explore the last three components '
`Entertainment: Attractions,
`Recreation, and Special Events
`In addition to lodging and eating, pleasure travelers who are away from home will seek various kinds _
`of entertainment. Sometimes that entertainment is directly associated with lodging, such as a theme .
`park or a casino, that also accommodate overnight guests. There may also be entertainment directly
`associated with eating establishments, such as visible kitchens that are designed for patrons to view,
`or murder mystery dinner theaters where waiters and waitresses double as an acting team. Still other
`kinds of entertainment may be stand-alone entities. Many activities fit in to the entertainment cate-
`gory. Travelers will often be lured to a destination because of the attractions, recreation, or special
`events. These various kinds of entertainment will typically be found in proximity to lodging and food-
`service. Overseas travelers to the United States, for example, are attracted by a wide range of activi-
`ties. In descending order of priority, these activities included shopping, sightseeing in cities, and
`participating in water sports or sunbathing. A more complete list of activities is included in Table 5.2.
`
`Table 5.2 Activities Participated in by Overseas Travelers, 1993
`25%
`Overseas Travelers*
`18,662
`Art Gallery/Museum
`21
`(in thousands)
`Guided Tours
`16
`83%
`Shopping
`Nightclub Dancing
`15
`69
`Dining in Restaurants
`Concert/Play/Musical
`10
`65
`Sightseeing in Cities
`Golf/Tennis
`9
`34
`Water Sports/Sunbathing
`Attend Sports Event
`6
`24
`Touring Countryside
`Camping/Hiking
`4
`33
`Visit Historical Places
`Cruise, 1 Night plus
`4
`29
`Amusement/Theme Park
`Hunting/Fishing
`3
`27
`Visit National Parks
`Snow Skiing
`*Includes travelers from Europe, Far East, South America, Caribbean, Oceania, Central America,
`Middle East, Africa. Mexico and Canada not included.
`
`Source: U.S. Travel and Tourism Administration.
`
`_
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`hopping According to the International Council of Shopping Centers (ICSC), shopping
`alls, factory outlet centers, and large discount malls continue to grow
`popularity as entertain-
`Iitcenters. Theme parks, virtual reality games, and kids’ playgrounds are more and more fre-
`6fi1_:lY appearing in shopping complexes. Retail outlets are also commonly associated with other
`siof entertainment, ranging from gift shops in theme parks, ball parks, and national parks to
`s in restaurants selling trademark items like T-shirts with company logos. Shopping streets, in
`'_t:1ties where clusters of retail stores exist, are a fonn of entertainment worldwide. For over-
`avelers in the United States, shopping was a popular activity, with some 83 percent of all vis-
`i "1993 having shopped, as is recorded in Table 5.2.
`
`lodging and
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`A varied number of complexes offer family entertainment, sometimes on a grand scale. Nashville,
`Tennessee, for example, offers an entertainment complex whose theme involves the music of the area
`in" the fonn of Opryland, USA. EuroDisney, in Paris, brings Mickey and Minnie Mouse to Europe in
`one of several Disney theme parks around the world. Because these attractions are end point desti-
`nations for visitors who likely have traveled far, these theme parks offer overnight lodging and food-
`service. We will discuss theme parks more extensively in the lodging chapters. Other attractions that
`do not have a lodging component include amusement parks, sightseeing, and shopping.
`
`Amusement Parks Amusement parks generally conjure up images of carousels, Ferris
`wheels, and family entertainment. In fact, amusement parks include traditional amusement parks,
`water parks, miniature golf, and family entertainment centers. Presently, many of the amusement
`facilities being built are associated with the casino industry. One need look no further than Las
`
`Vegas to find New York, New York, a hotel and casino complex that will mimic the architecture of
`the New York City skyline in its physical facility and house everything “New York” inside. The
`International Association of Amusement Parks and Attractions measures the annual revenue of
`
`amusement parks to be over $6 billion dollars in the United States alone.4
`
`Outdoors Indoors Other examples of unusual attractions were recently introduced in Japan.
`I An indoor beach, complete with waves, sand, and a leeward breeze, was created in a completely
`enclosed environment. This beach is probably the only one in world that people can enjoy 365 days
`a year without any weather interruptions. Similarly, an indoor ski resort was also created. The attrac-
`
`tion boasts artificial snow, varying terrain, and ski lessons. One main advantage of the creation of
`.' these attractions is the ability to operate predictably year-round. These attractions were also located
`_
`_
`_
`-"near a large population base and far from the alternative, the real thing.
`
`Sightseeing Sightseeing is generally associated with some form of transportation and always
`Involves a tour of some set of attractions. Major cities offer sightseeing by bus, double-decker bus,
`iolley, or boat. One can see London by guided tour from the top of ‘a double-decker bus, or walk
`the Freedom Trail’s historic sites in Boston, or see the banks of Buda and Pest by boat in Budapest.
`ightseeing tours can also be customized for particular groups and can be offered in multiple ianw
`ages. In Prague, for example, evening boat tours allow passengers to select an audio program in
`everal languages. Aerial tours are also offered by helicopter in at least 200 locations by member
`potnpanies of the Helicopter Association International.
`
`'
`
`.
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`Recreation
`
`
`
`Public Parks/Playgrounds Public parks and playgrounds serve as the great outdoors o
`cities and communities. They vary in size, location, and the recreational facilities that they ofier
`Services can range from playgrounds for children to cafés and carousels. Public parks do not hav
`any entrance fees or accommodations. A new trend is to open children’s playgrounds in malls. Th __
`Mall of America in Minnesota boasts the world’s largest indoor mall playground.
`I
`State and National Parks The national park system in the United States includes some;
`367 sites, including recreation areas, preserves, battlefields, historic sites, and monuments. There _
`are also 156 national forests and 20 national grasslands. Many parks serve as major tourist attrac-
`lions and sometimes offer a variety of lodging and foodservice in addition to guided tours and irLfor-
`mation centers. Lodging facilities can range from camping grounds and cabins to midscale and
`upscale hotels. Ecotourism, or culturally and environmentally responsible tourism, has become
`increasingly important as more and more visitors use the system.
`Outdoor Activities A wide variety of outdoor activities attract visitors. These include white
`water rafting, cycling, hiking, water sports, skiing and snowboarding, snowmobiling, and rock climbing.
`Natural attractions, such as rivers, lakes, or mountains are the anchors for these activities. In the rural
`locations where they exist, they can form a substantial part of the local economy. A relatively new type
`of travel has emerged in conjunction with outdoor sports known as adventure travel. The typical
`adventure traveler has interest in both physical fitness and the environment. Camping and hiking are
`the most popular adventure trips, followed by skiing and water sports such as snorkeling, scuba diving,
`and sailing.
`
`Festivals and Special Events
`Many communities in various parts of the world celebrate a particular piece of heritage, an event in
`history, the commerce of the area, or special talents in the area. These events may offer entertain-
`ment from the arts, such as handicrafts, dance, painting, storytelling, puppet shows, music, or
`drama. Food and beverage offerings, typically in keeping with the festival’s theme and varied shop-
`ping choices, are also found. Two such events are the lntemational Festival of Contemporary Music
`in Zagreb, Croatia, and the Edinburgh International Festival in Scotland. Special events may also
`involve a competition of wit or sport. These events can range from the sporting events such as the
`Running ofthe Bulls in Pamploma, Spain; to the Palio horse race in Siena, ltaly; to the International
`Camel Race in the nortbem Sinai. Other events celebrate the food and entertainment of a particular
`place such as the Oktoberfest
`in Munich, Germany, or Mardi Gras in New Orleans. The
`International Festivals Association (IFA) estimates that there are more than 50,000 annual festivals
`and special events worldwide.
`
`
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`olerfest can trace its history to 1810. In that year, in honor of the wedding of Crown
`Ludwig and Princess Therese of Saxony-Hildburghausen on October 12, the cit-
`izens of Municb were invited to attend the festivities, and have celebrated ever since.
`
`Want more information on Oktoberfest? Looking for reservations for the beer tents‘? Need
`a current map of Munich? Want train schedules from Paris to Munich?
`
`Go lilo further than the Internet, for Oktoberfest has a Web page. The City of Munich
`Tourist Oflice has hooked up with a company called Siemens Nixdorf Informationssyteme
`AC. Siemens is one of the largest European suppliers of information technology in
`Europe. The company concentrates on developing new technologies that enhance the
`distribution channel to the customer.
`'
`
`Together, Siemans and the Munich Tourist Board have put together a lengthy, full—color,
`interactive on-Iine brochure on Oktoberfest. It even includes a video! Along with photos
`.
`.
`.
`.
`.
`.
`of all the important spots to visit, it provides the customer with dates, and phone num-
`.
`.
`bers—and all for freel The Web page provides the Munich Tourist Board with an inex-
`pensive way to deliver information to customers all over the world.
`
`.
`.
`Some events are held periodically, or only once. They may be events that are repeated penod—
`cally in different geographic locations such as the Olympics,'the World’s Fair, or World Cup Soccer
`tr‘‘e55
`, all of which are widely recognized events. It is a major commitment for a city or country
`c host such an event. Having the world at your doorstep entails major capital expenditure. The
`iffel Toweris a monumental example of construction for a World’s Fair, held in Paris in 1885. It
`as had tourism impact on Paris and France for more than a century. Planning for events can take
`ears and involves massive coordination to arrange feeding, housing, transportation, and entertain-
`em: for thousands of visitors in a short period of time.
`
`A good example of a one-time event was the historic gathering of the Tall Ships in New Haven,
`.'011IlectiCLlt, in 1995. Sailing vessels from around the world gathered in the New Haven harbor for
`stoiic boat party. Another was the series of 50Lh—anr1iversary celebrations throughout Europe in
`.95," commemorating the end of World War II. .
`
`_mmg
`I
`aniiaigor gambling, is the act of playing various games, and betting on the outcome. Gaming usu-
`includes card games, slot machines, and such other games as roulette and craps. Participants
`eliets, and win or lose depending on the outcome. Hotel casinos were for a long time permitted
`two states, Nevada and New Jersey. By 1993, a gaming industry study had shown that by
`
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`1993, some form of gaming was legal in every state except Hawaii and Utah. In point of fact, th‘
`year gaming activity had driven U.S. gross gaming revenue from $10 billion in 1982 to approxl
`mately $30 billion in 1992. Government operated lotteries were fixtures in most states, while vide
`iotteries were operating in six states. Riverboat gambling was highly visible in five states. Casin
`gaming was commonplace aboard oceangoing cruise ships. And in 12 states, gaming was open to
`the public on 55 Native American reservations.
`Native American Casinos On October 17, 1988, the landmark Indian Gaming Regulatory,
`Act (GRA) became law, giving Native American tribes the right to offer games that were permitted
`by a state in any form to all comers—-—untaxed by the state unless the Native Americans agree to it.
`The law classifies gaming in three categories:
`
`
`
`'
`
`Class l—~Indian games and other social games
`
`Class II-“Bingo, pulltabs, punchtabs, etc.
`
`.
`
`Class III—A].l other commercial forms of gaming
`Tribes are required to negotiate compacts, or legal agreements, with their host states before spe-
`cific games are allowed. If a state fails to negotiate in good faith, a tribe may sue the state in federal
`court to arbitration. As of early 1993, according to the Indian Gaming Association, there were a total
`of 55 Class H1 casinos, in various states operating a variety of games,‘ such as: video games, slot
`machines, table games, roulette, blackjack, and poker. The gambling facilities on reservations range
`from gaming areas, with games noted above, to extensive gaming, lodging, and food and beverage facil-
`ities. ln the “Places to Stay” section of the book, we review casinos with overnight accommodations.
`
`The gaming facilities are either managed and owned by the local tribe, or leased by major cor-
`porations in exchange for percentage of revenues. The gaming business has become the main source
`of revenues and profits for many Native American tribes. The highest grossing casino in the world
`is Foxwoods in Connecticut, run by the Mashantucket Peqout tribe. It currently grosses more than
`$800 million annually.
`
`Riverboat Casinos Riverboat casinos commenced operations in April 1981, and have thus far
`have surpassed all expectations. As of January 1, 1994, five states had approved riverboat casinos.
`They are lowa, lllinois, Mississippi, Louisiana, and Missouri. As of 1994:, at least a dozen other states
`either have legislative initiatives under way forriverboat gaming, or have undertaken studies of such
`enterprises. Some 50 boats have gone into action since 1990, and that number again is under con-
`struction.5 The expectation is that by 1995 riverboat gaming revenue will exceed $2 billion.
`
`Dockside Casinos The state of Mississippi legalized dockside gambling in 1990. The dockside
`option was chosen, as opposed to land-based gaming, because the legislators believed that casinos on
`the water limit impact on the local communities and are more accessible from land than riverboats. The
`dockside casino industry has grown significantly since the beginning of the 1990s. There are more than
`24 dockside casinos on the Mississippi River and the Gulf Coast. Neither dockside casinos nor river-
`boat casinos provide lodging facilities. They offer gaming and food and beverage outlets.
`
`Gaming on Cruise Ships and Airlines Once a ship is 12 miles from American shores, it
`is in international waters, and gaming is permitted. Thus, most cruise ships have casinos. Casinos
`operate sometimes for day trips only, and sometimes for overnight guests. Overnight trips offer
`
`_
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`
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`are marketed as gambling cruises and are sometimes called “no-where cruises.” The gamblers are
`allowed to play in the ship’s casino after the ship has entered international waters. Elaborate meals
`and other attractions are usually offered on board. Gambling cruises, like the cruise industry itself,
`is appealing to wider and wider audiences.
`Several non-U.S. carriers, such as Transbrazil Airlines and Virgin Atlantic Airways, are cur-
`rently offering in-flight gambling activities. Virgin Airways offers video poker and blackjack at
`every seat. A customer inserts a credit card to play video games of chance. Winnings or losses are
`a
`lied to the credit card. Some American airlines have tried to ersuade the US. Uovernment to
`PP
`_
`P
`2::
`change the law that prohibits American carriers from providing gaming in any flight.
`
`See Exhibit 5.1 for a summary of entertainment components.
`
` Exhibit 5.1 Summary of Entertainment Components
`
`Category
`'
`Examples
`Attractions
`Amusement Parks
`
`to appr0xi_
`while video
`ate5_ Casino
`was open to
`
`E Regulatory
`are permitted
`15 agfee t0 lt.
`
`res before SP3“
`
`state in federal
`are were a total
`ieo games, slot
`ervations range
`
`l beverage facil-
`
`CQ[n_1'[1OCl3.fi0I'1S .
`
`_
`
`,5 by major com,
`the main source
`.ino in the world.
`.-osses more thah.
`
`an studies of S110
`’3‘“i5““de”°n
`2 billion
`
`han riverboats.
`Fhere a-I6 W01.-'_e .
`.e casinos H01’?
`utlets.
`‘
`Ame1,-wan shot
`Ive casino '
`'
`We,_.n',ght 11-ips,
`
`Outdoors Indoors
`
`Sightseeing
`
`' Shopping
`
`ltflecreation
`"Public Parks
`*
`tit dN'
`a e an
`at1on
`
`alP 1-:
`ar 5
`
`utdoor Activities
`'
`
`tlvals and Special Events
`v
`
`7
`
`I-4 . Vienna Fairgrounds, Vienna, Austria
`2. Warner Brothers Movie World, Bottrop,
`Germany
`. Canada's Wonderland, Toronto, Ontario, Canada
`. Port Aventura, Barcelona, Spain
`
`nI=CJu_
`
`}_:
`
`U-1I\.'JI—|l\3|—‘[\J
`
`. Somerville Rock Climbing Gym, Somerville,
`MA
`
`. Indoor Ski Area, near Tokyo, Japan
`
`. Circle Line Tour, Manhattan, New York, NY .
`. Helicopter Tours of the Grand Canyon, AZ
`
`. The Mall of the Americas, Bloomington, MN
`. Kittery Outlet Shopping Center, Kittery, ME
`. Bon Marché, Paris, France
`
`1. Central Park, New York, NY
`2. Hyde Park, London, England
`1:
`N '
`101dF'hfII
`Y]1
`t
`ar ,
`ation
`. WY a1t u nn,
`e ows one
`2. The Ahwahnee Hotel, Yosemite National Park,
`
`311°
`
`'
`
`1. Boston Pops Esplanade Concerts,
`Boston, MA
`2. Cheyenne Frontier Days, Cheyenne, WY
`1. The 1995 Special Olympics,
`New Haven, CT
`2. 1995 All—StaI Baseball Game, Arlington, TX
`3. Chicago Jazz Festival, Chicago, IL
`
`(Continued)
`
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`146 W _q/Ia;/*5 Q‘/I/0.‘ governs»:/'aco~
`
`
`
`Exhibit 5.: (Continued)
`Categor Examples
`4. V-E Celebrations throughout Europe, May 1995
`5. Carnival, Rio de Janeiro, Brazil
`
`Gaming
`Native American Casinos
`
`v
`
`River Boats/Dockside
`
`Cruise Ships
`
`1. Foxwoods, Ledyard (Mashantucket Pequot
`Indian reservation), CT
`2. The Shakopee Mdewakanton Sioux Casino, MN
`1. Sheraton Casino, Northern Tunica County, MI
`2. Dockside, St. Louis, MO
`1. Crystal Harmony, Caesar’s Palace at Sea Casino,
`Crystal Cruises, Los Angeles, CA
`2. Discovery Cruises, Fort Lauderdale, FL
`(Discovery I———a no-where cruise)
`3. Regal Cruises, St. Petersburg, FL (Regal
`Empress—a no-where cruise)
`1. Transbrazil Airlines
`-_ Airlines
`2. Virgin Airways
` Corporate -
`Travel Distribution Channels
`Consumers gather information about their destinations and make reservations for their trips using
`different approaches. Some customers book directly with the service they are reserving. For
`example, a customer can call the airlines to book an airline seat. In the same phone call,"the air-
`line passenger may reserve a rental car. In this case, the airline serves as a booking agent for the
`rental car company. A representative of the passenger, such as an administrative assistant, may
`book the car rental, even though the assistant is not the encluserl
`In this simple scenario, two agents
`are involved, one for the customer and one for the rental car company. Thus, agents are commonly
`found in the travel and tourism business.
`Customers may also access information directly, via toll-free numbers, on-line services, such
`as those available on the Internet, or contacting a tourism office. All of these links to information
`and reservations, or the travel distribution channels, connect the customer to the tourism industry.
`They are crucial to the customers’ ability to understand and consume the available services.
`Because ofthe perishability of services, that is, because they cannot be stored like products, an effi»
`cient information and reservations system is crucial to success.
`
`
`
`.
`j
`
`"I
`
`_
`_'
`
`I"
`
`Retail Travel Agencies
`Retail travel agencies are perhaps the best known of travel distribution channels. Unlike whole-
`salers, retail outlets deal directly with customers. Retail agencies may focus on iulbservice, group
`_ and incentive, or corporate bookings.
`
`_
`
`
`
`_
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`Starbucks v. Ameranth, CBM2015-00091
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`between the end user, the customer, and hospitality suppliers such as airlines, tour operators, and
`hotels. The customer can either buy individual products, such as an airline ticket or hotel weekend,
`or a combination of products in a travel package. The package will usually include accommoda-
`tions, transportation, attractions, and some food and beverage. Travel agents receive commissions,
`or payments based on sales, from the travel vendors. Travel agents
`a full-service retail travel
`agency are specialists who can provide and arrange travel information such as regulations, routing,
`prices, accommodations, and so on. Some travel agencies specialize in specific destinations or vaca-
`tions. Others may specialize in last-minute navel at discounted rates.
`
`Group and Incentive Some travel agencies specialize in incentive or group packages.
`Incentive tours are usually marketed to companies that wish to reward their agents, special clients,
`or employees. For example, a company may choose to reward its salespeople for exceptional perfor-
`mance. Those who exceed target goals would receive an all-inclusive tour package as a reward. A
`group of salespeople will likely be winners, and thus this type of agency typically deals in blocks of
`space from hospitality providers. For example, if Srnith’s Travel Agency specializes in group pack-
`ages, it has agreements with certain hotels in specific destinations. Those hotels may block -ofi sets
`of rooms, or even entire floors, in anticipation of the travel agency’s group. When agents are rewarded
`with trips, they are most often trips to these hotels, as the rooms are already reserved for the agency.
`
`Corporate Some travel agencies or agents specialize in corporate travel. Corporate navel
`includes the arrangement of airline tickets, accommodations, transportation, and other travel needs
`for business travelers. Corporate agencies or agents can be either independent entities that specialize
`in corporate travel, or internal departments within big corporations. The main objectives of these pro-'
`fessionals are to receive better prices due to high travel volume, to provide better control of compa-
`Ines’ travel expenses, and to provide better service for corporate executives and salespersons.
`
`-Tour Wholesaler/ Tour Operator
`A. tour wholesaler is a company that plans, markets, and operates travel tours. The marketing is
`done through the retail navel agents, clubs, associations, businesses, and other orga