Category: Free Essays

“Selling a hotel room used to be simple; business would literally walk in off the street. No more. As the number of channels a customer can use to book a hotel room grows, hoteliers will be forced to take a more holistic view of their technological infrastructure”, as quoted by Bruno des Fontaines (2007), Vice President for Amadeus Hospitality Group Asia Pacific.

Revenue Management is a complex phenomenon with many factors affecting the final outcome. Out of these innumerous factors, playing their role in revenue management, price is indeed one the most powerful tools a hotel can use to increase revenue. The key however is to know how to set the right prices and which distribution channels to use in order to maximize your revenue.

Tools using which, any product or service is provided to end consumer, constitute Distribution Channel of that product or service. Success or failure of a product relies greatly upon distribution channels. “In hospitality business, a successful channel management strategy consists of selling inventory at the highest possible rates, while pushing reservations through the lowest-cost channels”. (Barash 2005)

It is therefore of prime importance that a hotel chooses most effective distribution channels in order to manage prices and eventually to maximize its revenue. There is, however, a great array of approaches available to manage distribution channels which makes it a very challenging task for hoteliers, requiring for them to understand all distribution options available.

In past hotel distribution channels used to be most simplistic, the traditional main distribution channels were:

Brochures

Advertising

guide books

mail shots

call centers and

Travel agencies.

All of these modes, even though very simple and easy to manage, are extremely expensive and have a very limited range. They could be effective for local clientele only. With the passage of time and advancement in technology, other sophisticated and complex distribution channels originated that were never even thought of, such as

Central reservations

Global Distribution systems

Hotel Booking Agent

Tour Operator

Online wholesalers

However most of these channels only acted as a go-between hotel and the global-distribution-system (GDS)/travel agent. (Barash 2005). This wide array of distribution channels no doubt provide a great deal of benefit to the hotel in the sense that its availability to customers increases infinitely, customers all over the world can get to know about any hotel anywhere in the world through a travel agent or website etc. however at the very same time this phenomenon makes hotel distribution channels most complex and difficult to manage. Reasons for decline of GDS as an effective distribution channel as reported by HeBS (2002) can be due to following reasons:

“Slower than expected travel industry recovery and the weak economy

Channel shifting from traditional Consumer-Travel Agent hotel reservations to online bookings (leisure and unmanaged business travelers) and self-booking corporate systems.

Growing popularity of online business models (e.g. merchant) that do not utilize the GDS.

The emergence of direct interfaces between major online agencies and major travel suppliers thus bypassing the GDS.

Services like WorldRes, which utilize direct interfaces to the major hotel brands’ CRSs also undermine GDS distribution.

Decreased corporate travel: the latest survey by NBTA (September 2002) showed that 68% of corporate travel managers said travel was down in their companies from last year, in some cases by as much as 20%. Also, 72% of them said that current travel is below the 2000 levels-the last time travel was at normal volumes.”

Distribution of hotel rooms through traditional distribution channels such as GDS/travel agent and call center/reservation office, proves to be inefficient and extremely expensive, especially in light of the current weak economic situation. Focusing only on traditional distribution channels will result in lower occupancy rates, and higher distribution and operational costs. In this current scenario internet channels are emerging as more popular distribution channels that are being given increasing preference over traditional channels of distribution.

Internet distribution of hotels is of two types:

Direct Online Distribution

Indirect or Third party online distribution

Direct online distribution is where hotel pushes its property through a website constructed and owned by the hotel itself. Whereas third party web-based travel intermediaries such as online travel agents, have a certain number of rooms allocated to them that they sell through their own sites where mostly air tickets and car rentals are also offered among other things. The indirect distribution channel can be further subdivided into further subcategories such as channel to sell “distressed inventory” such as priceline. (HeBS 2002)

A hotel’s revenue is greatly affected by the method that a customer uses to book his/her room. If a lot of middle parties are involved in booking process then hotel’s share, in the amount that a guest pays for booking a room, can reduce to a great extent. According to Marvel (2004) “a room booked through a travel agent and the GDS (global distribution system) typically costs the hotel 15% of the reservation’s total. Contrary to popular belief, third-party websites are no bargain either for the hotelier, as they keep about 13% of a booking’s value. So-called “merchant” websites (such as Priceline.com or Hotwire) which basically buy inventory from hotels usually average a 33% mark-up on the rooms they sell. Bookings arriving via the central reservation system of voluntary chains (such as Minotel) can cream over 25% of the client’s original payment between travel agent, tour operator and chain fees. Many tour operators working in mass leisure destinations only pay 50%-60% of the normal room price to the hotelier who is lodging their clients”.

Looking at Hilton Amsterdam’s site also reveals similar facts, as can be observed from following table:

ADVANCE PURCHASE FULL PREPAYMENT, NO REFUND OR CHANGES (price in GBP)

Hilton website

243

Laterooms.com

258.76

Orbitz

243.5

Booking.com

254.871

(Rate differences between Hotel’s website and other online sources: The rate for Twin Hilton Deluxe Amsterdam room, on different booking sites available online, for one day 30th April – 1st May 2011. These rates were observed on 4th April 2011)

The fact can be clearly observed that best rates for room bookings are given by hotel’s own website, and obviously so because direct online booking on hotels’ own website has proven to be the best and cheapest source of distribution for a hotel.

eTRAK Full Year 2009 report on “hotel bookings by distribution channel” as quoted by Starkov (2010) shows that the online channel is the only channel that is growing even in today’s difficult economic conditions where demand for rooms is far less than the supply, “Internet bookings for the top 30 hotel brands increased by a remarkable 6.6% in 2009 vs. 2008”. Whereas hotel room bookings through GDS and Voice Channels, decreased considerably.

“HeBS’ findings based on the latest eTRAK benchmark report, surveys and industry data from PhoCusWright and ARC” as quoted by Starkov (2010) are as follows:

1) GDS Channel Is in Steady Decline:

GDS hotel bookings via the CRS of the top 30 hotel brands declined by 3.7% 2009 vs. 2008, and constitute 23.6% of total CRS bookings in 2009 vs. 27.3% in 2008 (eTRAK).

Back in 2006, GDS CRS reservations constituted 31.3% of total CRS bookings for the top 30 brands. GDS share has decreased by 24.6% from 2006 to 2009, when it was reported at the 23.6% level.

Travel Agency Share from Total Travel Market in the U.S. dropped from 41% in 2006 to 33% in 2009 (PhoCusWright).

U.S. Travel Agency Locations decreased by 7% in 2009 vs. 2008. The number of locations has been decreasing at an average rate of 4% every year since 2001, and the number of travel agencies has declined from as high as 35,000 in 1995 to less than 16,450 in September 2009 (ARC, HeBS).

2) The Voice Channel Contribution Is Decreasing:

Voice channel hotel bookings via the CRS of the top 30 hotel brands declined by 2.9% in 2009 vs. 2008, and now constitute 22.2% of total CRS booking in 2009 (eTRAK). Last year’s decrease is in addition to a decline of 2.8% for the full 2008 vs. 2007 (eTRAK). The Voice Channel is in decline for the 6th consecutive year (HeBS).

3) The Shift from Offline to Online Channel is Permanent:

54.2% of overall CRS bookings for the top 30 hotel brands come from the online channel, which is an increase of 6.6% vs. 2008 (eTRAK).

60% of leisure and 40% of business travel will be booked online in the U.S. this year (PhoCusWright).

45% of hotel bookings in 2010 will be via the Internet (direct + indirect online channels) (HeBS).

4) Direct online bookings are on the rise:

In 2009, 70.9% of online bookings came from the direct online channel (i.e. the major hotel brands’ own websites), while 29.1% came from the indirect online channel i.e. the Online Travel Agencies. Whereas in 2008 direct online bookings constituted 75.2% part of online bookings and indirect bookings were 24.8%. This represent a great increase in the number of bookings made directly on the hotel’s website as compared to indirect bookings. (Starkov 2010)

Hotel management perceptibly has greater interest in promoting the online booking, especially direct booking on the hotel’s own site, because it is far cheaper. According to a report on E-commerce estimated “cost of direct reservations by traditional means (i.e. fax, telephone, e-mail, etc.) could be as much as 300% higher than processing the same reservation through the GDS, which costs between $3-$5.Furthermore, most reservations, passing through the GDS, are generated by travel agents who charge an average fee of 10%. Bookings via a chain central reservation system cost the hotel $6 to $10 and reservations by a toll free telephone number $4 to $8”. However for hoteliers the cheapest and most satisfactory mode of booking a room is direct online booking variable cost of which is only about $1.50. (Marvel 2004).

Even though GDS still constitutes the major distribution channel for hotel rooms with a 68% share in 2003, their share is diminishing fast due to higher growth rate of the internet, according to Marvel (2004) overall electronic booking increased by only 1.6%, while online reservations rose by 35.5%. However the best source of distribution for any hotel is direct online booking because in indirect bookings the third party intermediaries take away the major chunk of hotels’ revenue in the form of commission. Therefore the major concern of hoteliers nowadays is to devise ways to attract customers to make room bookings directly to the hotels’ website. Several examples of such efforts are as follows:

Four Seasons do not allow any direct bookings over third-party websites.

Hilton (USA) declines “HHonors points” or “air miles for online bookings” to all the bookings that are made indirectly i.e. not on Hilton’s own website.

As of January 1, 2004, Starwood has also take a step in this regard i.e. all bookings made through indirect internet channels will not be eligible for any in-house benefits. Marvel, M. (2004).

Therefore all in all direct online bookings are on the rise and they appear to be the preferred mode in present conditions of recession. However in order to take advantage of this growth in the online distribution channel especially the direct online channel, hoteliers need to make strong and proactive Direct Online Channel Strategy. This strategy should be backed by funds. “Hoteliers must carefully employ ROI-centric initiatives, including website redesign, website optimization and SEO, paid search, email marketing, online display advertising and proven social media initiatives”. (Starkov 2010)

Even in this economy, the budget for internet marketing, and most importantly of direct online channel, should not be decreased or even diminished, because after observing past trends and results of various researches it can be safely said that online channel is the only growth channel for hoteliers and the “only light at the end of the tunnel in this environment. Even in these difficult times we see “Return on ad spend” (ROAS) as high as 3500% from Internet marketing campaigns we run for our clients”. (Starkov 2010)

Another obvious pattern in Hilton Amsterdam’s direct online pricing is that the rates given on hotel’s website are the most expensive when the booking is completely flexible (customer has complete liberty to alter his/her plans as well as they get their full money returned if cancellation is made before or on the day of arrival) whereas other sites give cheaper rates in this situation.

However on the other end Hotel website gives best rates in case of fixed reservations i.e. reservations in which no room is available for any changes and in case of cancellation hotel keeps all the money.

This could be due to the reason that in case of cancellation hotel has to bear the entire cost whereas booking sites that usually have rooms allocated to them do not have to face any such penalties.

ADVANCE PURCHASE FULL PREPAYMENT, NO REFUND OR CHANGES (price in GBP)

FLEXIBLE RATE, (Price in GBP)

Hilton website

243.524

278.438

Laterooms.com

258.76

277.31

Orbitz

243

262

Booking.com

254.871

273.201

Another observation is that Advance booking rates are different from immediate booking rates. It is an effective tactic to increase confirmed sales. Customers are encouraged to book their rooms well in advance, by offering them lower than usual rates. Booking cycle of a hotel determines how well in advance customers can book rooms, a hotel offers greater discount at the beginning of a cycle whereas higher rates are offered towards the end. (Ismail, 2001). This also helps in managing the bookings in lean seasons i.e. in off seasons lower booking rates are offered to attract greater distribution. Best rate for Hilton deluxe twin room decreases to ?202 from ?243 if the booking date was moved from 30th April to 31st April.

Hilton also offers package rates, hotel package comprise of a hotels room combined with any other service of the hotel, most commonly it is room and meal package that hotels offer.

There are many kinds of package deals available at Hilton hotel, such as:

Bread and breakfast package, where room is bundled with breakfast for two at a discounted price.

Another package combines air ticket, car rental and room all three in one package price.

Beside package pricing Hilton also offers group rates, i.e. booking a larger number of rooms for a party mostly at a lower rate.

Keeping in view the benefits and complexities of using multiple channels in hotel distribution we can say that the key to adopting best distribution channels and increasing revenues is to choose distribution channels as per hotels needs “without falling prey to an increasingly convoluted snakes’ nest of technology”. Managing these distribution channels also costs money and considerable time of hotel employees. . (Fontaines 2007) Complex hotel distribution systems are strategically dangerous for a hotel as managing a complex distribution may raise the price for customer who may switch to low cost channels.

GAUGE TO PREVENT TOURISM-RELATED CRIMES

PROPONENTS:

ARINGO, MICHAEL CHRISTOPHER
GUIANAN, AUBREY
MANZANILLA, NICKO
RABANO, JAYE CLARENCE
SABAO, JASPER

ADVISER:

JIDDEH N. SELDA, MBA

Introduction

Growth in tourism has led to increase opportunities and incidences of crimes. These crimes happened for several reasons. First, tourists are lucrative targets since they typically carry large sums of money and other valuables. Second, tourists are vulnerable because they are more likely to be relaxed and sometimes careless while on vacation. Finally, tourists are often less likely to report crimes to testify against suspects, wishing to avoid problems or a return trip.

Crimes are made by people who motivate themselves to create bad intensions. In order for the researchers to purposely maintain tourism in the country and to promote the magnificence of the Philippines, one must consider the security and safety of the tourist destination. Tourists must be aware of crimes. Crimes may happen in a bus, subways, hallways, airports, terminals, trains or tricycles. One common crimes in Albay is snatching.

The study clarifies the different terminologies use: Gauge is an instrument or device for measuring the magnitude, amount, or contents of something, typically with a visual display of such information;¹ Prevent means to stop (someone or something) not to do something or to stop (someone or something) from doing something;² Tourism is the commercial organization and operation of vacations and visits to place of interest and;³ Crimes is an action or omission that constitutes an offense that may be persecuted by the state and is punishable by law.⁴

Statement of the Problem

This study aims to know the gauge in preventing tourism-related crimes in Albay and it specifically answer the following questions:

What are the tourism-related crimes in the Second District of Albay from 2012-2013?
What particular areas are the common targets of tourism-related crimes in Albay?
What are the ways to prevent tourism-related crimes in Albay?

Scope and Delimitation

The study focused on the gauge to prevent tourism-related crimes in Albay. The study focused on the selected municipalities and cities in the 2^nd district of Albay, namely: Legazpi City, Daraga, Camalig and Rapu-Rapu.

The study is concerned with the conflicts and problems as experienced by the municipalities and cities in Albay.

Significance of the study

Philippine national police – This study will serve as the basis of the number of crimes in the year 2012-12013. To maintain the peace and order.

Community – The community, stakeholder, professionals, and the parents will find this study relevant in utilization of innovative measures along the crimes.

Future researchers – The findings of this study will be useful to the future researchers who conduct studies on the said innovations. The study also will serve as basis for future studies on innovation not in this study. Likewise, the findings can enrich the studies of researchers.

Students- This study will help the students so that they know what are the dangerous areas in the 2nd district of Albay. And to east to enable them to prevent crimes.

Media- This study will help the reporters to know some of the crimes that happen in each area. And it will also help them to their research problems.

Tourist- This study will help for them to know what place they should not go. And also to know what kind of crimes often do to tourist.

Present researchers-

Introduction

The tourism industry in Albay is one of the leading economic contributors in the country’s Its help our country to be one of the successful tourism industry in the world but one of the reason why our tourism industry was decreasing because of the crimes that happening in our certain place or destination, for example like a kidnaping, snatching, holdapping, sex tourism and etc. It’s happened in our beloved and successful country in the industry of tourism. And that is the disadvantage in our certain place or destination. We need to prevent or stop tourism crime so that the the tourist that came in our country or province will not be afraid to come and visit our destination. If the tourism crime decrease in our place it will one of the key to become successful contributors in our country. Despite of the economic distribution and contribution and opportunities that growth the potentials of tourism has been and still threatened by many factors such as poverty, crimes, killing people and unemployment. Albay is one of the beautiful landscape and natural attraction that you will see, but crimes is one of the threatened reasons that affect our province.

As for now the tourism crimes in our province is low crime rate but to prevent it the community people in our province will cooperate to prevent tourism crimes, be aware to the people who does who are doing crimes like to do in our tourist. To decrease the crime rate all of the people in the community will help each other in stopping crimes like protect our tourist stop the snatching, kidnapping, sex tourism, poverty, etc, so the tourist will not take negative impact in our certain destination. Our topic is one of the interesting study that our province will surely recognize our study in gauge to prevent tourism-crimes in Albay.

Vehicular- caused by or resulting from the operation of a vehicle, relating for designed for vehicles.

By: Merriam-webster dictionary

Man made crimes or human made crimes- human-made hazards can result in the form of a human-made disaster. In this case, anthropogenic means threats having an element of human intent, negligence, or error; or involving a failure of a human-made system. This is as opposed to natural hazards that cause natural disasters. Either can result in huge losses of life and property as well as damage to peoples’ mental, physical and social well-being

By: Wikipedia

Hold-up- is the crime of taking or attempting to take something of value by force or threat of force or by putting the victim in fear. At common law, robbery is defined as taking the property of another, with the intent to permanently deprive the person of that property, by means of force or fear.

By:Wikipedia

Kidnap- is the taking away or transportation of a person against that person’s will, usually to hold the person in false imprisonment, a confinement without legal authority. This may be done for ransom or in furtherance of another crime, or in connection with a child custody dispute

By: Wikipedia

Cyber sex- Cybersex, also called computer sex, Internet sex, netsex, mudsex, TinySex and, colloquially, cybering or conversex is a virtual sex encounter in which two or more people connected remotely via computer network send each other sexually explicit messages describing a sexual experience

By:Wikipedia

Scam- A confidence trick (synonyms include confidence scheme, scam and stratagem) is an attempt to defraud a person or group after first gaining their confidence, in the classical sense of trust. A confidence artist, con-man (or con artist) is an individual, operating alone or in concert with others, who exploits characteristics of the human psyche such as dishonesty, honesty, vanity, compassion, credulity, irresponsibility, naivete, or greed.

By: wikipidia

Thief- is the taking of another person’s property without that person’s permission or consent with the intent to deprive the rightful owner of it.[1] The word is also used as an informal shorthand term for some crimes against property, such as burglary, embezzlement, larceny, looting, robbery, shoplifting, library theft, and fraud.

By wikipedia

The goal of the Albanian tourism development is to increase the quality of living for a considerable number of Albanians. Tourism development should be measured and assessed in a medium and long-term manner in relation to its ability to improve the well-being of Albanians. As such, it is, can be (and should be) part of the country’s strategy to achieve development priorities, such as the Millenium Devlopment Goal commitments. More tourists do not necessarily mean more development or revenue for Albanians. The kind of tourism that the country chooses to develop is mainly defined by the contribution to the well-being of its citizens.

Emphasizing natural and cultural tourism will keep in focus the benefits for local communities, which are currently faced with limited economic opportunities.

The tangible benefits expected from a successful tourism strategy include: increased employment rates, additional revenues for the economy (core or additional), improved infrastructure, and increased tax revenues that would contribute to the improvement of health-care, education, and other social developments. Less tangible benefits include: confirmation of local culture and traditions, creation of opportunities to keep the young generation interested in residing in Albania or returning to their towns, and exchange of contacts with people of different cultures.

The following pre-conditions are necessary to achieve the objectives and realize the application of the necessary strategies in order to achieve these:

1. Principals of Sustainable Tourism Development be accepted on all levels of planning

Sustainability is a key factor for the tourism development in Albania. Only an environment friendly development process shall be the basis for an economically successful tourism development.

2. Basic infrastructure

The limited infrastructure is a major problem for a quick tourism development in most regions in Albania. The main international Airport in Rinas near Tirana and Durres has to comply with international standards. An additional airport in the South has to be set up for civil use (charter flights) in the future. For the international tourism market charter flights will be of utmost importance in the future. An efficient garbage and sewerage system is indispensable to keep the areas clean and attractive and thus ensuring a sustainable development. The handling of construction waste must also be improved. Connecting streets, water and electricity supply are also essential issues.

3. Clarification of ownership of land and buildings

The clarification of ownership of land and buildings must be completed as soon as possible. Sector Strategy: Tourism Development in Albania 4 Ministria Rregullimit te Territorit dhe e Turizmit

4. National and regional tourism law and regulations

The responsible governmental bodies have to work out a modern tourism law and additional regulations for tourism development.

5. Law enforcement

The enforcement of the existing law, especially in the field of construction such as regulations, building permissions, pollution is essential for a sustainable tourism de-velopment.

6. Clear responsibilities for tourism development on all levels

Responsibilities for the department of tourism within the ministry and all other Minis-tries and Institutions touching the field of tourism must be clearly defined.

7. Regional and national stability

8. Improved statistical information system

Effective tourism development needs profound information of the development of supply and demand. Therefore an efficient collection and analysis of the necessary data according to international standards must be organized on national, regional and local level.

9. Public / Private Commitment

The development of the tourism sector must be promoted through the government, particularly in the beginning. Most important is the concentration of the limited re-sources to few selected areas with the highest tourism potential and the best cost / benefit ratio. Also the private sector will need to commit funding if the potential benefits of tourism are to be achieved. This funding will need more than one year funding cycles and stronger public/private partnerships will be required if government funding is to be leveraged effectively. Sector Strategy: Tourism Development in Albania.

2.2.2 Tourism Development from 2003 to?????/

The number of foreign visitors has increased from 309,000 in 2003 to 914,000 in 2006

Tourism revenues as part of the GDP are calculated at 3.8%

The number of people employed in the tourism sector is 138,000

Tourist accomodation units (TAU)

No. of hotels

No. of beds in hotels

No. of TAU

No. of beds in TAU

No. of licensed hotels

No. of classified hotels

666

20 917

908

31 712

36

28

80 % of hotels have 1-20 rooms,

13 % of hotels have 20-40 rooms,

7% of hotels have more than 40 rooms,

14.29% of hotels are classified as one-star,

25% of hotels are classified as two-star,

35.71% of hotels are classified as three-star,

14.29% of hotels are classified as four-star,

10.71% of hotels are classified as five-star

Distribution of hotels
Most hotels are found in Tirane, Velipoje, Golem and Sarande.
Concerns related to “Incentive Person” titles

The existing tourism development situation shows that to date 96 structures, mainly in the coastal areas, have been given incentives. Fifty-one of them have been constructed on non-public state property and 45 on private property. The agreements signed with these subjects present developmental, economic, and financial concerns, bringing about:

Development of a site into a different destination (use) from tourism,
Low impact on employment, tourism-related professional updating and limited use of local product,
Use of tourism development priority construction sites (land-site, limited source) for residential buildings, which limits the generation of revenues from tourism,
Incentive benefits for non-tourism related structures.

Table: IP with a rent agreement (RA)

Area
IP with RA
Types of structures
Surface area rented out
Tourist Village
Tourist Complex (resort)
Hotels
Tourist ports

Golem

40

13

16

11

586254 m2

58,6 ha

Durres

Shkembi Kavaje

3

2

1

59100 m2

5,9 ha

Sarande-Ksamil

5

2

2

3 202 130 m2

320 ha

Orikum

2

1

1

127 400 m2

12,7 ha

Gjiri Lazli

1

1

120 000 m2

12 ha

TOTAL

51

16

18

14

2

401 ha

In the World Economic Forum (WEF) report of 2007, which evaluates and ranks country competitiveness, Albania ranks in 90th place of 124 countries, ranking above countries that have a long-time successful and established tourism, such as Kenya, Ecuador and Nepal. This proves that Albania has the potential to compete successfully. The analysis considered strong and the weak points in regard to cultural and natural assets, sector and human resources upgrading, institutional roles in long-term building and successful support of the tourism sector.

Albania’s ranking proves its excellent potential for tourism. The people are hospitable and open to visitors and the country is secure and stable. However, the ranking also points to weaknesses that harm competitiveness, such as lack of political will to undertake concrete actions, weak system of environmental protection and management, a difficult investment climate, unresolved land title rights and non-effective infrastructure and promotion efforts.

WEF REPORT: ALABANIA AND THE NEIGHBORING COUNTRIES

General index

Regulatory framework

Business environment and infrastructure

Human, cultural and natural resources

COUNTRIES

Ranking

Ranking

Ranking

Ranking

Albania

90

94

114

43

Macedonia

83

114

82

44

Serbia-Montenegro

61

79

80

13

Croatia

38

58

40

11

2.3 Role of the government in tourism sector

The objective of the law for the tourism Nr .9734, date 14.5.2007 is:

To establish the principles and rules that operate in the field of tourism, the establishment and development of standards in tourism services and other services related.

-Government support for the development of tourism

State bodies, in cooperation and under the auspices of the Minister of the Ministry responsible

on tourism, facilitate the development of tourism:

a) drawing up tourism development plans for each municipality and comune;

b) providing tourist information and organizing educational activities and

promotion;

c) taking measures for infrastructure development and establishment of facilities in areas

tourism development, tourist villages, tourist areas, tourist sites and resorts;

d) promoting investments in tourism in remote areas and with low population;

e) proposing fiscal policies incentives for tourism businesses, for individuals and

legal entities in the areas of tourism development, touristic villages, places and touristic points

that are operating in tourism enterprises.

-Tourism development plans prepared in accordance with the provisions of this law contain:

a) provisions for the development of tourism and the definition of specific areas for

this purpose;

b) evaluation of the invested capital from different investors, in accordance with national plans, municipal and communal, development for a period of 5 years, 10 years or longer;

c) the provisions of the work plan in the infrastructure of the area in places and touristic points, in line with national tourist potential and the socio-economic development plans;

d) The provisions of promotion and marketing activities;

e) the provisions of educational activities and the need for continuous professional development.

2.3.1 Infrastructure issues

The lack of basics infrastructure was identified rightly as the key core issue to impede the development of Albanian tourism and major efforts have been made to improve the situation in the recent years. Water supply, waste water and canalization, solid waste collection and disposal, highways and coastal access roads and parking at the touristic hot spots during the season are just the key issues which had to be addressed and have been addressed in the recent years. A lot has been achieved but given the immensity of the challenges of this still poor country which has lost most of the 20th century and was not been part of the western modernization drive of the 19th as well the gap between Albania and even its close neighbors of Montenergo and Macedonia is still a major obstacle to touristic development. The road issue has improved but water and waste is still the major challenge. Water especially is actually the biggest challenge of Albania. There is either too much or too less and it is never where it should be. In winter there is too much rain leading to flooding or snow emergencies in the mountains and flooding later in the season. If there is too less of it the energy situation turns precarious as most of the energy comes from the Drin Hydropower cascade and with a lack of rain the country is reaching not just a energy emergency but as well a budgetary crisis due to the subsidized energy imports necessary. During the tourist season the water supply to the main tourist site has a history of issues as has the elecrictiy supply due to the demand peaks in August which the systems lack the capacity to cope with. Waste water is another issue as despite major GoA and donor support still a lot of waste water is left untreated into rivers and the sea and the resulting environmental and hygienically situation is the issue of many bitter memories of Kosovo tourists with skin disease of their children following their Durres holidays. Solid waste removal and cleaning of the beaches has been another issue which has to be tackled. Again the issues of licensing beach areas to private operators following the Montenegro example seems to be the better approach then to rely simple on municipality services. Concerning solid waste it seems less a issue of collection capacity but of collecting of municipal waste fees. This leads again to ownership issues and the solutions described in that chapter. And to the fact that given the low and reasonable low tax rates of 10% flat, it is a fact as flat as the tax that all over charges like waste, water and electricity have to be set at levels that are covering all costs and allow for profits and neither of them allows as a means for social transfers. Nobody owning a property in a prime touristic area is in the need of subsidized community services.

Basic infrastructure is a prerequisite for tourism development and somebody has to pay for it. It can be the state or its international donors, the property owners of the area or the consumers meaning the tourist’s using it or best a combination of all based on case by case utility.

Casino gaming has experienced extremely growth in the some other countries such as US, Macau of China during the past many years. Some researches shows that casino gambling is accepted by economically wrestling location and that it can be a potential development strategy. The impacts slowly come down to other area of the economy, including income maintenance payments recipient (Kale, S. H., 2004). However, many from the Singapore local community have blamed the casinos for the negative impacts caused to the country. On the other side, local governments and local workers do not appear to reap the big share of benefits, as much of the income gained by casinos is went to pot through leave out outside the main country.

Positive Economical Impacts

Firstly, casino can provide more job opportunities for local employees. Almost jobs are relatively low-skilled, low-paying service types, though there is evidence that tips swing the balance to higher than average pay for some occupational groups. However, unionized casino workers are nearly ten times more than the national average to have their health coverage paid in full and have subsidize payment that surpassed the national average. Casino jobs have been a magnificence “welfare to work” example. Furthermore, casino jobs can create immediately employment opportunity in some areas.

Secondly, Economic development is a multifaceted concept that reflects numerous concerns not captured by conventional income statistics (Chen, J. S., 2010). Per-capita income, imperfect as it is, still provides one plausible measure of economic well-being. Per capita income grew nearly five percentage points faster in casino counties than in their non-casino county counterparts. This result is statistically significant. Therefore, casinos not only grow the local economy, but on average residents gain as well.

Thirdly, gambling can be a powerful economic development tool. The basic criteria for economic development success are for a project to increase a region’s net exports. Specifically, the amount of goods or services that are exported needs to be increased or the amount that are imported decreased. This is the only way that income can increase (Singapore EXPO Convention and Exhibition Centre, 2009). Projects can certainly be an overall economic success in terms of profit without doing either of these, but those profits come at the expense of other businesses.

Moreover, the city that casino is located in will gain a more amount of tax from the casino, also making that city more wealthy. If a casino is opened in a country side where there lack of businesses, there will bring other businesses in, such as restaurants, gas stations, hotels, and even theme parks, which will bring in more revenue for the city, in this case, Marina Bay Sand can be a very good example. The country will get more from the profits, taxes and anything the casino need to pay to the Singapore’s gaming commission in order to be able to operation. If the casino is not located near many other casinos or the size of the country is not so large such as Singapore, that will attractive more tourists to the area, bringing in even more profits (Alfonso, R. O., 1997).

On the other hand, this is not a sign that gambling in casinos should be banned permanently. Casinos have been in appears for hundreds of years and the games have been played for centuries. Moreover, as a form of entertainment, gambling also has its advantages, such as relaxation. Generally, the objective is to win if you can. One should not completely eliminate the aspect of losing. This means risking only the amount of money that you can to lose in game (Alfonso, R. O., 1997). The key to a successful game is simply managing it with the good mindset. In fact, in gambling, where betting risks are great, in which case a wagering system is advised. This includes of discipline or the ability to manage by yourself, especially if you come to a losing streak and your previous winnings start to reduce.

Negative Economical Impacts

The main negative impacts include the consuming on public services, like sewers and road maintenance, and the costs of increased crime prevention in casino neighborhoods and even in adjacent communities. In other word, the negative impacts are related to the economic carrying capacity of the region relative to the size of the new casino.

While the money invested in several gambling projects and the jobs at the first instance created are cleared, the industry has been criticized for inflating the potential grows economic impacts and unremarkable the negative impacts (Goodman, R., 2001). The industry tends to focus on specialized factors provides an unfair view of the localized economic positives, also refusing the strategic business economic costs to the country as an adequate. Using legalized gambling activities as a strategy for economic development was carefully reputation losing during the hearing.

Moreover, gambling activities and the gambling philosophy are straightly effect to the business principles and economic development. Legalized gambling activities also have bad effect to education at philosophically and fiscally (Clotfelter, C. T. & Cook, P. J., 1991).

On the other hand, states which grip legalized gambling activities can expect major socioeconomic costs and reduce the quality of life. Otherwise, legalized gambling activities provide addicted and potentially addicted consumers to the market, and most existing traditional businesses will find it a bit challenge to compete. For instance, some researchers strongly suggests that the introduction of popular legalized gambling in Resort World Sentona, including casinos and video lottery terminals, over a 4 months’ time span caused 1% increase in the number of problem and potential pathological gamblers (Sim, A., 2010). Based on a research, each new pathological gambler has been calculated to cost society from $26,200 SGD to $78,000 SGD per year (Hooi, D. H., 1999). These costs are not just impacted in society as a whole, but also impact on all businesses.

On the other hand, major businesses should be concerned with the expanding various forms trending of legalized gambling activities. Non-gambling related businesses will not be rivaling for benefits on a level playing field, because legalized gambling activities can provide to a potentially addicted market segment. Since the Singapore economies are extensive in scope, the socioeconomic negatives combined with legalized gambling activities can keep hidden for a long time period. However, a particular activity is legalized by a government not mean that the societal effects or negative business have been reduced.

In addition, varieties casino styles and locations are better than the others, but these factors are not outstanding specify of casino effects at this time. Nevertheless, a new casino catering to Singapore local market can generate positive secondary economic effects through its employees if it induces an increase in total employment in and around its host community. Such affects are greatest for new casinos in areas of high demand of employment.

Task 2
2.1. Target Markets

With highly competition around the ASIA, the IRs will enhance Singapore’s image as best destination. The IRs will allow Singapore can have more advantage from the Asia Pacific tourism sector. Factor in Singapore’s strategic location, its good flight connect with low cost airlines and a world-class infrastructure, the IRs will present lots of good opportunities for Singapore (The Business Times, 2010).

Using the Bahamas and Las Vegas as a comparison, the local Integrated Resorts will provide distinct world-class development coupled with a whole range of amenities such as luxury hotels, entertainment shows, theme attractions, convention facilities, and also casino gaming. The IRs is expected to create nearly 35,000 jobs, and the industry is expected to invest US$7.1 billion in IRs (US$3.5 billion in Marina Bay; US$3.6 billion in Resorts World) (singaporecasinopromo.com, 2010).

2.2. Location

There are different ways to look at potential markets. We might classify players as grind, middle or premium, or might also identify local, traveler or destination markets. What it boils down to understand how much that your customers will spend and how far they have to travel to reach the casino. Other significant niche markets include Asian or Middle-Eastern players (Dandurand, L., 1990).

The proposed world-class resort, suitably named Resorts World at Sentosa, is destined to be Asia’s most mesmerizing family resort and will entrench Singapore as one of world’s leading leisure holiday destinations. They are both established names in the region in the leisure, hospitality and gaming industries and boast a customer base spanning the globe with an impeccable track record, excellent industry relationships and an unrivalled sales and marketing distribution network in Asia and beyond. It will be develope on the island of Sentosa, off the southern coast of Singapore (temasekreview.com, 2010). The 49 hectare integrated resort will cost S$600 million solely for land, and S$1.6 billion just on a Universal Studios theme park called Universal Studios Singapore.

2.3. Entertainment

At a cost of just under $5 billion US, the integrated casino resort Singapore’s Resort World Sentosa just makes the others such as Mirage and Bellagio in Las Vegas, US look downright cheap. If the Mirage needed $1 million US a day to cover its $630 million US price tag, early reports suggest RWS is so far an unqualified success. According to Union Gaming Group they have been winning between $7 million US and $8 million US a day since doors opened in February 2010 (Livedealer.org, 2010).

Other while, Resort World Sentosa is neither the biggest nor the most ambitious casino project that has been built in the last five years. Less than 5 kilometers down the road from Sentosa Island at Singapore’s Marina Bay, a casino is due to open in less than a fortnight’s time. This one cost $5.5 billion US to build. The Marina Bay Sands is the current benchmark for big budget casino resorts (CHP Partnership, 2005).

2.4. Current IR Promotions

Recently, Singapore could be one show closer to becoming the “Broadway of Asia” comes next March 2011. That’s when Disney’s award-winning Broadway musical, “The Lion King” will opens at the new 1,630-capacity Sands Theatre at Marina Bay Sands. Marina Bay Sands and BASE Entertainment, main partners who bringing in the musical, made the announcement together on 26 October 2010, to get the Southeast Asia debut of the mega-production, which will cost more than S$10 million to stage and produce over the next few years (Marina Bay Sands Singapore, 2010).

BASE Entertainment Asia’s vice president Milan Rokic said, “This production is one of the many 1st class events we’re bringing to Southeast Asian audiences, as part of BASE plan to help Singapore become the world best live entertainment destination for the region and all over the Asia.” (Channel News Asia, 2010).

On the other hand, Resorts World Sentosa offers venues for MICE, such as Meetings, Incentive Groups, Conventions and Exhibitions, that few places can match. Customers can showcase their business at the world’s biggest WaterWorld amphitheatre, or hold a stunning themed party in Egypt, or New York, or Hollywood, or the futuristic Sci-Fi City (Resort World Sentosa, 2010).

Task 3
Improving Security and Surveillance Procedures with Help of Technology

Each day, millions of dollars change hands in a casino in the form of chips and money. With the help of technology, casinos are able to modify the way security and surveillance procedures are being utilized in their premises.

IP Video Management Software

Marina Bay Sands Casino in Singapore is using a powerful complex surveillance problem-solving based on XProtecta„? Corporate of Milestone Systems, a very big open platform company in IP video management software. From June 2010, Marina Bay Sands Casino also took over complete control of security monitoring for the Marina Bay Sky Park, close at hand within the casino, where some VIPs stayed during the Nation Day in August 2010 (Sim, A., 2010). “Like all other casinos we need to follow to standard laws and regulations for security and internal formalities. Our casino also tries to provide the best service to our customers. So we have decided to work with the best advanced surveillance technology on the market,” said Baybars Oral, Director-VIP Gaming (and also known as Director of Mass Table Games) (Sim, A., 2010).

The technology is used Milestone Systems’ IP video open platform solution, XProtect Corporate. With a few simple clicks, controllers can manage hundreds of oversee cameras at the same time, viewing reality or store images from different servers concomitantly. Furthermore, the video material is easily accessed when the police want evidence.

Thousands cameras are linked to the servers, with a storage capacity of 10 TB of each. This is necessary for the video storages since recordings from the gambling tables must be saved for 31 days followed the law, also the images from the cash transactions must be keeping around 62 days. The video records with sound and this gives a very good advantage: when customer asked to put the money on the table and there is reasoning, the operators can play back to determine precisely what did happen, which fast resolves any misunderstanding or mistake. The images are also used to ensure that all internal procedures are appear (Sim, A., 2010).

“With Milestone we can find correct views from many different corners, and scroll back, checking quickly, and also zoom in for close-ups. The checking often does with who has put a chip on the table at a certain time and for an unusual amount. We can collect the images from many cameras at the same time and see the details of a person action,” says Baybars Oral.

Overall, Baybars Oral believes that the systems based on Milestone platform, are priceless when one willing to take the risks related with operating a casino. According to Baybars Oral, there are many experts out there who have made a career out of cheating. “Our people are trained to identify those cheaters, and when that appears we are talking about huge money. That’s why it really important for us to invest in such high technological solutions, and that also provide more benefits to our customers from our security and service” Baybars Oral said (Sim, A., 2010).

Task 4
4.1. Concepts of Responsible Gambling Framework

Problem gambling is defined as all gambling behavior patterns that can compromise, disrupt or damage personal, family or vocational pursuits. It can affect both the person who gambles to excess as well as others (such as family members, co-workers, employers or community members) (Ministry of Public Safety and Solicitor General, n.d.).

Source: Journal of Gambling Studies (2002).

4.2. Reduction and Rehabilitation of problem Gamblers

Some research studies have shown that pathological gambling is a form of addiction affecting more than 5.5% of the general population. Researchers have developed a research on responsible gambling and problem gambling and associated addictive behavior. According to professionals, these researches help school and workplace managers recognize and manage gambling problems that may appear in students and employees. Moreover, to incurring significant debt, problem gamblers or compulsive gamblers typically display a lack of interest in school or work, develop relational, and emotional problems (Singapore EXPO Convention and Exhibition Centre, 2009). Hence, it is necessary that problem-gambling prevention should be incorporated into school and workplace regulation. Prevention is the action taken to prevent an undesirable problem. It identifies the needs of people who may be at risk of developing a gambling problem.

There several ways that Singapore government and other stakeholders can assist in the reduction and rehabilitation of problem gamblers as following:

Public awareness and media campaigns

Provide accurate, balanced information on gambling, the harmful consequences of problem gambling and promote healthier alternatives by:

aˆ? Promoting the awareness of problem gambling issues and services in Resort World Sentosa and Marina Bay Sands casino.

aˆ? Developing an overall prevention theme – Key messages that dispel myths.

aˆ? Proactive use of media to promote prevention messages and theme such as TV, Radio, Advertisement campaigns (Sentosa Casino Resort, 2010).

aˆ? Providing low risk guidelines that enable adults to self regulate and monitor gambling behavior.

Community Involvement

Support the development of municipal policies and prevention initiatives that foster a community environment where responsible gambling is the norm by:

aˆ? Inviting municipalities to partner in addressing issues related to problem gambling and responsible gambling – Partnership forum.

aˆ? Distributing information about the incidence and prevalence of problem gambling.

aˆ? Prevention providers working with schools and community groups.

Standards and Policies

Develop public interest standards and policies to decrease risks such as:

aˆ? Advertising Standards,

aˆ? Responsible Gambling Standards.

Professional Education and Skills Training

Develop and deliver ongoing training that is evidence based and reflects best practices in delivery of prevention programs:

aˆ? Develop accredited curriculum for delivery by some justice Institute.

aˆ? Develop and deliver curriculum to train allied professionals and collateral service providers.

aˆ? Develop and deliver training to increase skills of gaming providers – ART training.

aˆ? Support the development of problem gambling prevention components for university and college curricula.

Introduction

This report will give analysis and explain different aspects of the Edinburgh Fringe Festival in terms of public relations. The Edinburgh Fringe Festival is the largest arts festival in the world, therefore it is important to carefully consider all the aspects and opportunities from a public relations perspective, as it is a great example of the different sides and features of public relations. After looking at the history of this festival, the report will provide an insight in the positive and negative aspects of the Fringe, name the main competitors and give SWOT and PEST analysis. Then the key public relation issues for the event will be analysed and analysis of the media environment relevant to the event will be given. Finally, a critical assessment of the success of the event’s PR strategy will be considered.

History of the Fringe

The Edinburgh Fringe Festival originated in 1947 and it was created to celebrate and enrich European cultural life in the wake of the Second World War. It first started when eight acts turned up at the Edinburgh international festival uninvited and decided to perform anyway this then lead to more acts following in their footsteps in the years to come. From this, the Festival Fringe Society was formed in 1959. The Fringe, these days, is now known as the largest arts festival in world and in 2010 the Fringe featured 40,254 performances of 2,453 shows in 259 venues. It is held every August for three weeks in the centre of Edinburgh and there are stages all over Edinburgh for example the Hilton Hotel, Edinburgh Castle and Underbelly. It is such a special event as it caters for everyone by having various acts put on, such as: theatre, comedy, dance, physical theatre, musicals, operas, music, exhibitions and events.

Positive aspects of the Fringe

The Fringe has been renowned for giving unknown performers a chance to be recognised as it is “made up of emerging and established artists” which is a review from edfringe.com. The Fringe has also been acknowledged for having worldwide recognition for being one of the best arts festivals in the world and this helps bring a lot of tourism into the capital city. Each year ticket sales rise incredibly as 1.8 million tickets were sold in 2009 and that increased to 1.9 million sold in 2010. This can be brought down to the effective communication from the society as they have advertised in newspapers, on posters, through television adverts, on radio adverts, on websites and they have even branched out to new technology by launching a Fringe iPhone app. The Fringe is so popular because anyone can enjoy a show as they have a range of entertainment for all audiences. They include free shows too, which are ever increasing because 558 shows at the 2010 Fringe were absolutely free, compared to 465 in 2009.

Negative aspects of the Fringe

During the research it was found that the children’s shows only made up 4% of the Fringe performance programme in 2010 and this may discourage families to come to the events as there is little choice for the children. Also the dance and physical theatre performances went down 0.5% to 4.5% in 2010 and this may be seen as the Fringe society not seeing these genres as important as others such as comedy. Another downside is that the performance locations are far too widely spread throughout city so many people will have to spend a lot of money on travelling. There are a high number of performances each year so this means acts will overlap one another causing people to miss out on some shows.

Main competitors

Throughout Scotland there are numerous festivals, whether they are large or small scale. It is known from the official fringe website that the Fringe has a market share of 75% of all attendance at Edinburgh’s year round festivals and annually generates ?75 million for Edinburgh and the Scottish Economy. These figures from 2004/05 demonstrate the high profile of the Fringe as an event in Scotland. Despite accounting for the vast majority of the market share in Scotland, there are other events throughout the country which seek visitors.

The Magners Glasgow International Comedy Festival takes place over 18 days with 350 performances from well-known and rising comedians. The festival held at the kings theatre in Glasgow, specialises in comedy. This is different from the fringe where although there are comedy events, there is an array of other arts as well. For comedy enthusiasts the Magners comedy festival may be more attractive as it is specialised with more opportunity to see comedy. As the event is also only held at one location, it’s more simple to find and easier to experience many performances without trekking across the city. It may be on a much smaller scale that the Fringe but the less busy atmosphere may be much more appealing to some individuals.

The Stanza poetry festival which is held in St Andrews is described by visit Scotland as ‘where music, film, dance and poetry work in harmony’. The stanza poetry festival could be seen as a small scale Fringe festival however it primarily specialised in poetry. Within this, the aim is to combine other arts into the poetry. This unique selling point is a strength to the festival. Held at the Byre theatre in St Andrews, the festival is not incredibly well-known. This may have been due to a weakness in pr strategy and demand for this kind of event.

Although the comedy and poetry festivals cannot really contend with the fringe due to its mass scale, they are strong in some ways as they specialise in events for a specific target audience. However on a larger scale, the Royal Edinburgh Military Tattoo can be seen a more pressing competitor. With performances from 40 countries, the Tattoo invites visitors from all over the globe to not only visit the event but also perform. Whereas at the fringe, it can be presumed that a large amount of the acts will be British. 35% of the 217,000 audience each year are from overseas which is advantageous as it means there is a great mix of cultures. The fringe see’s similar figures for its overseas percentage however towers over the tattoo with its number of visitors. The tattoo is one main event whereas the fringe is many events over a long period. Therefore it is difficult to compare the two as they are in completely different formats. However unlike the fringe, the tattoo is shown on television with 100 million viewers worldwide. This illustrates the publicity of the tattoo making it the fringe’s main competitor in Scotland. However as the fringe is the largest Art’s festival in the world, naturally it will come out on top of other Scottish festivals.

SWOT and PEST analysis

Through the SWOT analysis it was found that:

· Strengths – Brings tourism to Scotland, there is a range of entertainment available and its largest arts festival in world.

· Weaknesses – Acts overlap one another, too big so travel costs increase and there are not enough acts for children so may discourage families.

· Opportunities – Emerging acts can become recognised, it entices different cultures to experience Scotland and it creates more job opportunities in Edinburgh.

· Threats – The festival faces competition from rival festivals, environmental issues may prevent the festival taking place and they may have a lack of funds to support such a big event.

Through the PEST analysis is was found that:

· Political – It creates an environment where countries can combine and it also gives politics a light-hearted nature (by putting on plays about David Cameron, etc.).

· Economical – Brings money to Scotland and it also encourages tourism.

· Social – There are more tourists around and it enables the Scottish culture to be recognised.

· Technological – A new website has been launched and so has a new iPhone app, in order to promote the Fringe.

Analysis of the key public relation issues for the event
Analysis of the media environment relevant to the event
Opportunities and threats in terms of media relations

Edinburgh Fringe is a huge Festival, so there is a chance that it will get a lot of coverage – both good and bad The Edinburgh Fringe Festival is the largest arts festival in the world so media will want to cover it. Also, there are a lot of opportunities to get media coverage outside Scotland and UK, especially in the European countries that are known for their love for arts such as France, Germany and Italy.

However, if something goes wrong there will definitely be a huge interest from the media therefore everyone will know about it. As Edinburgh Fringe is such a enormous event, taking place over several weeks , with so many performances going on and so many people attending there is a chance for great success as well as great damage in terms of media relations.

The key media

Firstly, the key media are the print media and web sites – history shows that newspapers and the websites of these newspapers are the sources of reviews and media coverage in general for the Edinburgh Fringe Festival. Secondly, the electronic media is a vital key media because this festival is all about the arts therefore photographic examples are very important. Thirdly, the radio is also one of the key media as people really like hearing the interviews with the event organisers and the performers of the acts from the Festival. And finally, the television, especially important during the Festival – people can see what’s happening in the Festival, see something they like and decide to attend. Television also captures the mood and the atmosphere of the festival best.

What would appeal to journalists and attract coverage

The popularity of the festival in social networks such as twitter, facebook, etc, as well as having its own blogs creates the word-of-mouth effect that’s not media generated so people get involved themselves and are not encouraged by the media but by other people. Media usually are interested if a lot of people get involved in this – they are intrigued – why is it so popular among the publics, is this a new phenomenon and why. It also attracts media because it seems more genuine this way – the company hasn’t spent lots and lots of money for campaigns to attract the attention. The media also like to write about events that are attended by celebrities because this guarantees the interest of the readers or about events that no one had expected or are shocking.

Bad stories – Fringe 2008

The resignation of the Edinburgh Fringe director, Jon Morgan, came at the end of a summer of bad news stories for the Edinburgh Fringe festival in 2008. Underlying them all is the question of how to cope with the unprecedented popularity of the world’s biggest arts festival. Most of the stories were about a new computer system that struggled to do the job. The ?350,000 Liquid Box Office crashed on its first day of operation, causing sales to be suspended for a week. Then it had trouble printing tickets, resulting in delays in postal bookings. Once the Fringe began, it sold too many tickets for certain shows, leading to reports of “weeping youngsters” being turned away.Finally the Fringe had to scrap the advertised two-for-one “ticket frenzy” on the final day, as the system couldn’t cope. One of the bad examples is also the self-styled comedy festival which was a marketing exercise designed to attract sponsorship (which it failed to do) and spread the costs of advertising between the big four venues: Assembly, Gilded Balloon, Underbelly and Pleasance. It caused consternation by including only the comedians who were playing in those venues and threatened to damage the profile of the Fringe itself. The central box office takings had dropped by 10% that year.

Good stories – 2009

The Edinburgh Festival Fringe was suffering the backlash of the media on the back of a box office meltdown in 2008. The UK was in the middle of the storm of the so called ‘credit crunch’ and many predicted the 2009 festival would be an expensive luxury that would be avoided by all but those most faithful to the festival. Under these circumstances it was a client that commissioned Whitespace to take a ‘blank canvas approach’ and re-think the traditional approach to marketing. The result was a genuinely original and creatively challenging campaign concept and materials featuring over 100 viral videos, and, for the first time ever, a multiple set of covers for the Fringe Programme – all on a very limited budget and under extremely tight deadlines. Whitespace created the concept of an iconic and metaphorical ‘egg’ that symbolised the fact that the Fringe is always different, and that one can never be sure what lies within. Whitespace filmed the scientific ‘discovery’ of a seemingly indestructible egg among Edinburgh’s tramworks. The resultant film became the viral centrepiece of the campaign. Having taken the egg to a secret Fringe laboratory overseen by Professor Ed Hegg, a series of filmed experiments ensued as he tried to reveal the egg’s contents. The story was launched several months before the Fringe. Dr Ed Hegg received a page of coverage in the Scotsman; pre-launch publicity not normally received by the Fringe. Whitespace then developed a range of printed collateral, from T-shirts to banners, displays to ticket wallets and press passes, as well as a campaign microsite and a social media campaign. This included Dr Ed Hegg’s twitter page and blog along with shooting over 100 video experiments for inclusion on the microsite. The result was an increase of nearly 9% in ticket sales and a programme reprint. The fringe site reached 32,906 unique visitors with a low bounce rate and dwell time of, on average, 4 minutes. 10% of all fringe site visits resulted in a visit to the booking section of www.edfringe.com and 21% of all visits resulted in a desired action.

Good Stories – Fringe 2010

“Fringecover was the top trending Twitter topic in Scotland on Thursday 25th and Friday 26th March and it was the second most tweeted topic across the UK.” Inspired by the Fringe’s principle that anyone with an idea and a vision can bring their show to Edinburgh; Whitespace invited the Twitter community to tell Johanna Basford the most unusual thing they’d like to see at the 2010 Fringe supplemented by #fringecover. For two days, from 10am to 10pm on Thursday 25th and Friday 26th March, Johanna recreated Twitterers’ suggestions in real-time in her own unique illustrative style.

The Whitespace creative team then applied Johanna’s illustrations to all aspects of the Fringe’s promotional materials including, three cover versions of the programme; the ticket, its wallet and envelope; the Fringe shop’s window display and pop-up exhibition panels. Audiences at the Fringe festival in Edinburgh bought nearly 2 million tickets last year, once again beating the previous year’s record. Kath Mainland, the event’s chief executive, said the sale of more than 1.95m tickets for more than 40,000 performances had shown the festival was “the greatest show on earth”. The Fringe said this year’s event, again dominated by comedy, had outstripped last year on most measures: there were 40,254 performances of 2,453 shows at 259 venues, involving more than 21,000 performers. More than 550 shows were free.

A critical assessment of the success of the event’s PR strategy
Conclusion

This report has analysed different public relations’ aspects of the Edinburgh Fringe Festival. It has provided research on the background and history of the event, analysis of the event, analysis of the key public relations issues for the event, analysis of the media environment relevant to the event, as well as a critical assessment of the success of the event’s PR strategy. One of the clear thoughts after the analysis of the festival is that the Fringe has definitely experienced bad times in terms of public relations; however, the organisers have only learnt from their mistakes and chosen much better PR strategies that have resulted in growth in the ticket sales, despite the very bad economic situation. Audiences have come to know the Edinburgh festival fringe as the place to see every kind of art; from the most imaginative children’s theatre to topical and incisive comedy and theatre which challenges audiences to discuss and re-consider not only their world but the world in general. Kath Mainland, the event’s chief executive has said: “Edinburgh is without doubt the world’s leading festival destination and audiences continued to be inspired and enthralled by the many and varied events on offer.”

The Indian aviation industry is one of the fastest growing aviation industries in the world with private airlines accounting for more than 75 per cent of the sector of the domestic aviation. It is stated that the Indian aviation sector will become one of the top five civil aviation markets in the world over the next five years. Currently, India ranks ninth in the global civil aviation market. The Hyderabad International Airport has been ranked amongst the world’s top five in the annual Airport Service Quality (ASQ). With the growth in the industry, airport retailing has also gained pace in the recent times. Development of new terminals and airports such as the recently inaugurated T3 in New Delhi has provided added impetus to this segment. The highest margin earners in this segment are food and beverages, beauty product, electronic items, apparel etc. It has been predicted that airports would provide around 300,000-400,000 square feet retail space by 2015. Many companies are also planning to leverage on this growing segment by launching specific products for air travelers.

In addition, the emphasis on modernization of non-metro airports, fleet expansion by airlines, service expansion by state owned carriers, development of the maintenance, repair and overhaul (MRO) industry in India, opening up of new international routes by the Indian government, establishment of new airports and renovation and restructuring of the existing airports have added to the growth of the industry.

Present Indian Scenario

It is a phase of rapid growth in the industry due to huge build-up of capacity in the LCC space, with capacity growing at approximately 45% annually. This has induced a phase of intense price competition with the incumbent full service carriers (Jet, Indian, Air Sahara) this- counting up to 60-70% for certain routes to match the new entrants ticket prices. This, coupled with costs pressures (a key cost element, ATF price, went up approximately 35% in recent months, while staff costs are also rising on the back of shortage of trained personnel), is exerting bottom-line pressure.

The growth in supply is overshadowed by the extremely strong demand growth, led primarily by the conversion of train/bus passengers to air travel, as well as by the fact that low fares have allowed passengers to fly more frequently. There has, therefore, been an increase in both the width and depth of consumption. However, the regulatory environment, infrastructure and tax policy have not kept pace with the industry’s growth.

Enactment of the open sky policy between India and Saarc countries, increase in bilateral entitlements with the EU and the US, and aggressive promotion of India as an attractive tourism spot helped India attract 3.2 million tourists in 2004-05. This market is growing at 15% per annum and India is expected to attract 6 million tourists by 2010. Also, increasing per capita income has led to an increase in disposable incomes, leading to greater spend on leisure and holidays and business travel has risen sharply with increasing MNC presence. Smaller cities are also well connected now. Passenger traffic has increased and over 21 million seats have been sold, resulting in a growth of over 50%. The Indian travel market is expected to triple to $51 billion by 2011 from $16.3 billion in 2005-06.

Application of Porter’s Five Forces strategy in the Aviation Industry
Threat of New Entrants

A lucrative industry is always a target for investors looking at investment. One of the foremost factors in consideration while looking at the attractiveness of an industry is the threat of new entrants. In the airlines industry, this was a major threat a few years ago. The airlines operating in the industry were limited and the industry had few players like Indian Airlines and Jet Airways. However, as the industry had scope for accommodating more players many players joined the fray. The airlines industry however comes with its fair share of barriers. The investment in the airlines is very huge and acts as a major barrier to entry. Bundled with it were different permits for running an airline company from the civil aviation company and FDI limits. Factors that can limit the threat of new entrants are known as barriers to entry. Some examples include:

Existing loyalty to major brands

Incentives for using a particular buyer (such as frequent shopper programs)

High fixed costs

Scarcity of resources

High costs of switching companies

Government restrictions or legislation

Power of Suppliers

This is how much pressure suppliers can place on a business. If one supplier has a large enough impact to affect a company’s margins and volumes, then it holds substantial power. In the airlines company there is certain amount of bargaining power the suppliers have. Firstly, suppliers in the form of aircraft builders, who very often exceed the time limits. Adding to it are suppliers of oil who hold the key to running of the airlines. Here are a few other reasons that suppliers might have power.

There are very few suppliers of a particular product

There are no substitutes

Switching to another (competitive) product is very costly

The product is extremely important to buyers – can’t do without it

The supplying industry has a higher profitability than the buying industry

Power of Buyers

This is how much pressure customers can place on a business. If one customer has a large enough impact to affect a company’s margins and volumes, then the customer hold substantial power. Predominantly, in the airlines industry, it has been seen that the civil aviation ministry has been in favour of the customer and buyers thus have reasonable power. While most airlines companies are running with wafer thin margins, it is pretty difficult for companies to increase prices as the capacity utilization will be seriously affected. Here are a few reasons that customers might have power:

Small number of buyers

Purchases large volumes

Switching to another (competitive) airline is simple

The airline is not extremely important to buyers; they can do without the same brand for a period of time

Customers are price sensitive

Availability of Substitutes

What is the likelihood that someone will switch to a competitive product or service? If the cost of switching is low, then this poses a serious threat. Most airline companies have similar facilities and are listed on website such as makemytrip.com, yatra.com where customers choose from the cheapest available tickets. This shows that the customer has a lot of options and would

Not mind shifting to a new service. Here are a few factors that can affect the threat of substitutes:

The main issue is the similarity of substitutes. All low cost airlines have similar facilities.

If substitutes are similar, it can be viewed in the same light as a new entrant.

Competitive Rivalry

This describes the intensity of competition between existing firms in an industry. Highly competitive industries generally earn low returns because the cost of competition is high. The competition in the airline industry is cutthroat and each player is trying to gain an upper-hand based on non price factors. A highly competitive market might result from:

Many players of about the same size; there is no dominant firm

Little differentiation between competitors’ products and services

A mature industry with very little growth; companies can only grow by stealing customers away from competitors

SWOT ANALYSIS OF THE AVIATION INDUSTRY
Strengths:

Growing tourism: Due to growth in tourism, there has been an increase in number of the international and domestic passengers.

The estimated growth of domestic passenger segment is at 50% per annum and growth for international passenger segment is 25%

Rising income levels: Due to the rise in income levels, the disposable income is also higher which are expected to enhance the number of flyers.

Growth potential Liberalization of sector.

Modernization of non metro airports.

Rising share of low cost carriers.

Fleet expansion by state owned carriers.

The opening up of new international routes by Indian government.

Establishment of new airports and restructuring of old airports.

Weaknesses:

Under penetrated Market : The total passenger traffic was only 50 million as on 31st Dec 2005 amounting to only 0.05 trips per annum as compared to developed nations like United States have 2.02 trips per annum.

Untapped Air Cargo Market: Air cargo market has not yet been fully taped in the Indian markets and is expected that in the coming year’s large number of players will have dedicated fleets.

Infrastructural constraints: The infrastructure development has not kept pace with the growth in aviation services sector leading to a bottleneck.

Huge investment requirement for physical infrastructure for airports.

Shortage of qualified instructors due migration to schedule operation.

Pressure on quality standard of inducted pilots.

Infrastructural constraints.

Opportunities:

Expecting investments: investment of about US $30 billion will be made.

Expected Market Size: Average growth of aviation sector is about 25%-30% and the expected market size is projected to grow up to 100 million by 2010.

Economic Growth

Vibrant middle class: Increasing Consumerism and Affordability “common man”

Under-penetrated markets

Growth in Tourism

Currently domestic passenger market is growing at 50%

Threats:

Shortage of trained Pilots: There is a shortage of trained pilots, co-pilots and ground staff which is severely limiting growth prospects.

Shortage of Airports: There is a shortage of airport facilities, parking bays, air traffic control facilities and takeoff and landing slots.

High prices: Though enough number of low cost carriers already exists in the industry, majority of the population is still not able to fly to other destinations.

Security and safety.

Low profit margins and high operating costs.

This essay will examine the Porter’s fives forces model applied to the major airline industry. Secondly it will assess the market condition and nature of competition faced by Lufthansa and finally this essay will look at an effective competitive strategy and explain why it may be successful. From the analysis of the Porter five forces of competition model in the airline industry, we can conclude that there is moderate level of competitiveness within the airline industry with the exception of strong supplier power. In addition, we can also conclude that due to difficult market conditions and the nature of competition faced by Lufthansa, an effective competitive strategy would be cost leadership as it will enable Lufthansa to survive through the current economic crisis.

Competitive Rivalry is one of the central forces of the Porter five forces model that is used to assess the competition within an industry (Capon, C. 2009). In the case of the airline industry, it is one of the major industries in the world today and it exists in an intensely competitive market (Investopedia. 2009). Air France KLM, Lufthansa and British Airways are the leading companies in the European airline industry (Datamontior, 2008). The core activity of these airlines is passenger transportation and they are competing for the same customers for example, leisure and business travellers (Datamonitor, 2008). These airlines are continually competing against each other for price, in-flight entertainment, technology, customer service, catering services, ancillary services and other areas (Datamonitor, 2008). Air France KLM, Lufthansa and British Airways maintain their customer base by sustaining their differentiation within the services they provide to their customers. (Capon, C. 2009).

“The air industry in Europe has been deregulated to a certain extent, which makes it more attractive to new entrants” (Datamonitor, 2008: p.13). The second force of the Porters five forces is the threat of new entrants into an industry (Capon, C. 2009). The airline industry is so saturated that there is hardly space for newcomers (Investopedia, 2009). The important factor that new entrants will look at is the cost of entry. It is important to look at whether there are substantial costs involved in accessing bank loans and credit as this makes the likelihood of more airlines entering the industry higher if burrowing is cheap (Investopedia, 2009). It is evident that the capital required for a new company to enter the airline industry is considerably high, for example to acquire the fleet of planes, safety and security measures etc (Datamonitor, 2008). In addition, there are significant costs involved for even existing airlines to begin operating in Europe, such as overheads, wages etc (Datamonitor, 2008). Therefore, the bureaucracy and large financial outlay involved in setting up can serve as a deterrent to new companies entering the airline industry (Datamonitor, 2008).

In addition the infrastructure available is a barrier to entry. The infrastructure in “Europe is lagging behind the growth in traffic” (Datamonitor, 2008: p.14).Congestion is increasing and therefore slots at certain airports have become a commodity for certain airlines. This makes it difficult for new entrants to negotiate primetime slots at busy airports and can result in restriction to offering flights at only off peak times or having to fly to other less busy airports away from popular destinations (Datamonitor, 2008). The Global economic meltdown and the rise in oil prices have made it difficult for the airline industry in the year 2008. As a result although UK market revenues are high, the likelihood of new entrants is weak to moderate (Datamonitor, 2008). Another major barrier to entry is brand name of existing airline as they can lure customer into using their service, even if the costs are higher that other airlines (Investopedia, 2009).

Another force that Porter describes is the threat of substitute products or services. “The main substitutes for airline are other forms of transport, road, rail and marine.” (Datamonitor, 2008: p.15). The distance and time taken to reach a destination using a substitute service serves as a threat for the airline industry if the customer perceives the substitute service as equally good (Capon, C. 2009). The distance between European destinations are relatively small. The flight may be short in duration however, the time to check in can make the overall time of the journey similar to the rail travel service (Datamnitor, 2009). Another threat to the airline industry is the environmental impact of travelling. “Some consumers may see the greater environmental impact of air travel as a significant disadvantage compared to rail” (Datamonitor, 2008: p.15). However longer journeys are not a threat to the airline industry as “rail travel may be comparatively time consuming and rail fares often compare unfavourably, reducing the threat of this substitute” (Datamonitor, 2008: p.15). Overall, the threat of substitutes for travel to the airline industry is moderate (Datamonitor 2008).

The bargaining power of buyers is another force of the Porters five forces model. The main buyers in the airline industry are leisure and business travellers (Datamonitor, 2008). Buyers’ power in the airline industry is assessed as moderate overall. “The large number of individual consumers in this market diminishes buyer power, as the impact on an airline of losing one customer is marginal” (Datamonitor, 2008: p.13). Consumers are able to switch from one airline to another as it does not incur any additional costs therefore customers are free to shop around for the best deal for their particular journey (Datamonitor, 2008). Overall, the airline industry is highly price sensitive and many customers are eager to find tickets with the lowest price for their journey (Datamonitor, 2008). Buyers’ power has increased marginally due to “online booking sites that allow consumers to compare and contrast tickets according to price, flight times and number of stops en route and travel agents who assist customers in finding the best deal” (Datamonitor, 2008: p.13). In response to consumers being able to switch from one airline to another with ease, they are offering loyalty schemes such as BA’s executive Club to their consumers (Datamonitor, 2008).

In addition, another force that Porter describes is the bargaining power of suppliers (Capon, C. 2009). The airline industry is characterized by strong supplier power as a result of global duopoly of Boeing and Airbus that exists in the manufacture of aircrafts globally and that there is no viable substitute for jet fuel that has yet been discovered (Datamonitor, 2008). Airlines have little control over rising fuel prices as no alternative source of energy is available and as a result supplier power is strong (Datamonitor, 2008).

“On first of July 2009, Lufthansa finally took over BMI the second biggest carrier at Heathrow airport” (The Economist, 2009: p.60). This deal gave Lufthansa control of more flights from London Heathrow airport than any other airlines except British Airways (BBC, 2008). Lufthansa is facing extremely difficult market conditions due to the present economic crisis (Flottau, J. 2009). As a consequence of the Global economic downturn, the acquisition of BMI and two other smaller airlines makes Lufthansa strong enough to weather the storm better than others (The Economist, 2009). Lufthansa saw its premium traffic fall by 15% in the first four months of 2009 and its competitor British Airways premium tariff fall by 17% (The Economist, 2009). Due to plunging demands in the market, Lufthansa is trying to conserve cash and cut capacity. However, the last thing it wants to do is spend precious money and time trying to sort out the struggling, sub-scale airline BMI (The Economist 2009). Lufthansa faces competitive rivalry. Low cost carrier such as Easyjet, Ryanair, Air Berlin are Lufthansa’s most dangerous competitors (Flottau, J. 2009). Bargaining power of suppliers increases as the penalty for late cancellations of new aircraft orders are high (The Economist, 2009). This makes it difficult for airlines to cut down capacity to match the fall in demand (The Economist, 2009). In addition the rise in jet fuel prices by fifty percent since the beginning of the year, adds extra costs to the airlines (The Economist, 2009). This increases supplier power as there are no other alternatives to use (Datamonitor, 2008).

“The airline recently warned that without fierce cost cutting measures it would fail to make even an operating profit this year” (The Economist, 2009: p.60). An effective strategy for Lufthansa would be cost leadership (Capon, C. 2009). “Lufthansa’s declared aim is to increase the sustainable profitability of the segment by cutting costs” (Lufthansa Annual Report, 2008 p.1). This will be an effective competitive strategy for the current economic crisis. Lufthansa is making capacity adjustments to match plunging demands (Mayrhuber, W. 2009).”400 jobs (overhead) will be phased out by 2011. (That will save us costs of 55 million euros)” (Mayrhuber, W. 2009: p.4). In addition Lufthansa has planned to reduce personal unit costs by ten percent which will save cost of a hundred and ninety million euro’s and furthermore reduce material costs by seven percent by 2012 (Mayruber, W. 2009). In order to make profits, this strategy will enable Lufthansa to survive through the economic crisis.

To conclude, the porter five forces of competitive, rivalry, threat of new entrants, threat of substitute service and the bargaining power of buyers are assessed at a moderate level to the airline industry. However the bargaining power of suppliers is strong. I think that the airline industry should maintain this level of competitiveness in the industry as it will make them more efficient and improvement in the quality of their services will increase as a result. Lufthansa is facing very difficult market conditions (e.g. increase in jet fuel, decrease in demand etc) due to the economic meltdown and as a result I suggested the cost leadership strategy for Lufthansa in order for them to survive though this economic crisis.

A Hotel may be defined as per the British law as A place where abonafide traveler can receive food and shelter provided he is a position to pay for it and is in a fit condition to be received.

The Indian Hotels Company Limited (IHCL) and its subsidiaries are collectively known as Taj Hotels Resorts and Palaces and is recognised as one of Asia’s largest and finest hotel company. Incorporated by the founder of the Tata Group, Mr. Jamsetji N. Tata, the company opened its first property, The Taj Mahal Palace Hotel, Bombay in 1903. The Taj, a symbol of Indian hospitality, completed its centenary year in 2003.

Taj Hotels Resort and Palaces comprises more than 60 hotels in 45 locations across India with an additional 15 international hotels in the Malaysia, United Kingdom, United States of America, Bhutan, Sri Lanka, Africa, the Middle East and Australia.

Spanning the length and breadth of the country, gracing important industrial towns and cities, beaches, hill stations, historical and pilgrim centres and wildlife destinations, each Taj hotel offers the luxury of service, the apogee of Indian hospitality, vantage locations, modern amenities and business facilities.

IHCL operate in the luxury, premium, mid-market and value segments of the market through the following:

Taj (luxury full-service hotels, resorts and palaces) is the flagship brand for the world’s most discerning travelers seeking authentic experiences given that luxury is a way of life to which they are accustomed. Spanning world-renowned landmarks, modern business hotels, idyllic beach resorts, authentic Rajput palaces and rustic safari lodges, each Taj hotel reinterprets the tradition of hospitality in a refreshingly modern way to create unique experiences and lifelong memories.

Taj also encompasses a unique set of iconic properties rooted in history and tradition that deliver truly unforgettable experiences. A collection of outstanding properties with strong heritage as hotels or palaces which offer something more than great physical product and exceptional service. This group is defined by the emotional and unique equity of its iconic properties that are authentic, non- replicable with great potential to create memories and stories.

Taj Exotica is resort and spa brand found in the most exotic and relaxing locales of the world. The properties are defined by the privacy and intimacy they provide. The hotels are clearly differentiated by their product philosophy and service design. They are centered around high end accommodation, intimacy and an environment that allows its guest unrivalled comfort and privacy. They are defined by a sensibility of intimate design and by their varied and eclectic culinary experiences, impeccable service and authentic Indian Spa sanctuaries.

Taj Safaris are wildlife lodges that allow travelers to experience the unparalleled beauty of the Indian jungle amidst luxurious surroundings. They offer India’s first and only wildlife luxury lodge circuit. Taj Safaris provide guests with the ultimate, interpretive, wild life experience based on a proven sustainable ecotourism model.

Upper Upscale Hotels (full-service hotels and resorts) provide a new generation of travelers a contemporary and creative hospitality experience that matches their work-hard play-hard lifestyles. Stylish interiors, innovative cuisine, hip bars, and a focus on technology set these properties apart.

The Gateway Hotel (upscale/mid-market full service hotels and resorts) is a pan-India network of hotels and resorts that offers business and leisure travelers a hotel designed, keeping the modern nomad in mind. At the Gateway Hotel, we believe in keeping things simple. This is why, hotels are divided into 7 simple zones- Stay, Hangout, Meet, Work, Workout, Unwind and Explore.

As travel often means more hassle than harmony, more stress than satisfaction, modern travelers are looking for smarter choices. Driven by passion for perfection, Taj welcomes its customers to a refreshingly enjoyable and hassle-free experience, anytime, everywhere. Offering the highest consistency in quality, service and style the hotel set new standards and take the unwanted surprises out of traveling. Taj’s warm welcomes make guests feel at home, away from home and its crisp and courteous service empowers them to get more done with greater effectiveness and control. And through Taj’s unrivalled network it provide service that is effortless, simple, never overwhelming, always warm.

Ginger (economy hotels) is IHCL’s revolutionary concept in hospitality for the value segment. Intelligently designed facilities, consistency and affordability are hallmarks of this brand targeted at travelers who value simplicity and self-service.

Taj Hotels Resorts and Palaces is committed to replicate its domestic success onto international shores with plans to build an international network of luxury hotels, which will provide an exemplary product-service combination and in the process create a global brand. The current international portfolio includes luxury resorts in the Indian Ocean, business and resort destinations in the Middle East and Africa, serviced apartments in the UK, the first hotel in Australia and three a top-end luxury hotels in the US.

Throughout the Company’s expansion, its mandate has been twofold: to infuse a sense of Indian heritage and culture within each diverse property, while also anticipating the needs and desires of the sophisticated traveller. Over the years, the Taj has won international acclaim for its quality hotels and its excellence in business facilities, services, cuisine and interiors.

The Taj strengthened its presence in the Indian Ocean rim with the Exotica Brand. The Taj Exotica was evolved as part of Taj Hotels Resorts and Palaces intent to position it as a brand that is clearly differentiated by its product philosophy and service design. The Taj Exotica Resort and Spa, in Maldives is centered on high-end accommodation, intimacy and an environment that allows its guest’s unrivalled comfort and privacy.

Taj Hotels further expanded its global footprint by securing management contracts at Palm Island, Jumeirah in Dubai, Saraya Islands in Ras Al Khaimah, Aldar Group in Abu Dhabi, UAE Langkawi in Malaysia and Thimpu in Bhutan. The most significant additions to the portfolio have been The Pierre, the iconic landmark hotel on New York’s Fifth Avenue, Taj Boston and Blue, Sydney.

The presence of Taj Hotels Resorts and Palaces internationally has been developed through a network of Taj regional sales and PR offices in the United Kingdom, France, Germany, Italy, Dubai, Singapore, Australia, Japan, Russia and the United States of America.

At the Taj Hotels Resorts and Palaces luxurious living and fine dining find common ground. Whether it is introducing exotic world cuisines to India or taking authentic Indian fare to the world, the Taj Hotels Resorts and Palaces is renowned for the eclectic culinary experiences it brings to its guests. Through a vast repertoire of award-winning restaurants, legendary recipes from royal kitchens and celebrated food festivals, the Taj has pioneered innovation in fine dining across the world.

Taj Hotels also promise a whole new experience of tranquillity and total ‘wellness’, through Jiva Spas a unique concept, which brings together the wisdom and heritage of the Asian and Indian Philosophy of Wellness and Well-being. Rooted in ancient Indian healing knowledge, Jiva Spas derive inspiration and spirit from the holistic concept of living. There is a rich basket of fresh and unique experiences under the Jiva Spa umbrella of offering, Yoga and Meditation, mastered and disseminated by accomplished practitioners, authentic Ayurveda, and unique Taj signature treatments. Royal traditions of wellness in service experiences, holistic treatments involving body therapies, enlivening and meaningful rituals and ceremonies and unique natural products blended by hand, come together to offer a truly calming experience.

IHCL operates Taj Air, a luxury private jet operation with state-of-the-art Falcon 2000 aircrafts designed by Dassault Aviation, France; and Taj Yachts, two 3-bedroom luxury yachts which can be used by guests in Mumbai and Kochi, in Kerala.

IHCL also operates Taj Sats Air Catering Ltd., the largest airline catering service in South Asia, as a joint venture with Singapore Airport Terminal Services, a subsidiary of Singapore Airlines.

Additionally, it operates the Indian Institute of Hotel Management, Aurangabad since 1993. The institute offers a three-year diploma, designed with the help of international faculty and has affiliations with several American and European programmes.

CORPORATE SUSTAINABILITY AND SOCIAL RESPONSBILITY

As a part of Tatas; India’s premier business house; Taj Hotels, have always believed in society and environment being integral stakeholders in our business along with its shareholders, customers, vendors and others. Over the last decade, the movement towards ecologically sound tourism has gained urgency and importance across the globe and we recognize that responsible practices in vogue are as diverse as the geographies.

Taj promote corporate citizenship through our strategic public-private partnerships which encourage building livelihoods of less-advantaged youth and women. The causes they promote include reducing malnutrition, promoting indigenous artisans and craftsmen and enhancing employability of identified target groups by sharing our core competencies as a leading hospitality company.

Taj have the unique scope and opportunity to develop raw potential into a skilled workforce that is immediately employable by various players in the industry. A majority of its community projects are focused around extending its key strengths in food production, kitchen management, housekeeping, customer service and spas to promote economic empowerment of candidates from vulnerable socio-economic backgrounds. The group is fully committed to the cause of building a sustainable environment by reducing the impact of its daily operations on the environment and improving operational efficiencies, resource conservation, reuse and recycling of key resources.

A glimpse of indicative projects undertaken by Taj group

Taj’s sixth Corporate Sustainability Report was submitted to the United Nations Global Compact society in August, 2009. The United Nations Global Compact is a strategic policy initiative for businesses that are committed to aligning their operations and strategies with ten universally accepted principles in the areas of human rights, labor, safety & security, environment and anti-corruption. This Corporate Sustainability report also serves as their GRI (Global Reporting Initiative) as well as Triple Bottom Line report. The report focuses on identified priorities at IHCL and responds to key stakeholder needs. Taj plan to continue and further strengthen its commitment to the environment and societies in which we operate.

EARTH

In an endeavour to reinstate its vision and efforts to boost sustainable tourism, Taj Hotels Resorts and Palaces presented EARTH (Environment Awareness & Renewal at Taj Hotels) this year. Implementing schemes such as the Gangroti Glacier Clean-Up Expedition, as well as designated Earth rooms, which minimise environmental impact, Taj is one of Asia’s largest group of hotels to commit to energy conservation and environmental management. EARTH has received certification from Green Globe, the only worldwide environmental certification program for travel and tourism.

The Taj began a century ago with a single landmark – The Taj Mahal Palace Hotel, Mumbai. Today, the various Taj hotels, in all their variety and historical richness, are recognised internationally as the symbols of true Indian hospitality. The Company’s history is integral to India’s emergence into the global business and leisure travel community; and looking to the future, Taj Hotels Resorts and Palaces is well positioned to meet the increase in travel activity with the rapid expansion of the Indian economy.

Hotel Leisure and Other Services include:

24 hrs Front Desk

Airport Transfer – On Request

Astrologer On Call

Banquet Facility

Bar & restaurants

Barber Shop

Beauty Salon

Bell – Desk Services

Car Rentals

Currency Exchange

Express Check in Check out

Facilities For the Physically Challenged

Florist

Health Club

Health/Ayurveda Centers

Hotel Safe

Internet Access Available in Rooms

Internet/E-mail/Fax Facilities

Interpreter Services

Laundry Services

Library

Lounge

Luggage Storage

Medical Services-Doctor on Call

Phone-Two Telephone Lines in Rooms

Postal/Parcel Services

Room Service-24 Hrs

Shopping Arcade

Travel Desk – Ticketing, Tours

MARKETING MIX STRATEGY OF TAJ HOTELS

Products

Room

Restaurant and Bar.

Meeting room and Banquet facility

Amenities

Services

Safe deposit box

Special services

Courier

Child care

Laundry

Pet

Internet

Travel desk

Babysitting

Wake-up call

PRICE

Taj hotel has set its price of the room on the basis of Business, Leisure and Luxury class.

PLACE

Location of the hotel is the most important business decision for the hotel.

Present in metro cities in India

Global presence (Maldives,London,Dubai,Colombo)

PROMOTION STRATEGY

Promotional schemes are carried on regularly the hotel has many loyalty programe,clubes,membership,previlage etc some of them are

The Taj Inner Circle.

The Taj Junior League.

The Taj Club.

Taj also offer Taj surprises including weekend savers,value vouchers,book early get more,

ADVERTISEMENT

Business news paper(E.T, Financial Express, Bombay Times)

T.V channels like STAR NEWS,CNN and CNBC.

Magazines like THE OUT LOOK TRAVELAR,GO NOW and TRAVEL.

Porter’s 5 Forces Model

The state of competition in an industry depends on five basic forces, which are diagrammed above. The collective strength of these forces determines the ultimate profit potential of an industry. Whatever their collective strength , the corporate strategist’s goal is to find a position in the industry where his or her company can best defend itself against these forces or can influence them in its favor.

Contending Forces
Threats of Entry:

New entrants to an industry bring new capacity, the desire to gain market share, and often substantial sources. Companies diversifying through acquisition into the industry from other markets often leverage their resources to cause a shake up. The seriousness of the threat of entry depends on the barriers present nd on the reaction from existing competitors that the entrant can expect.

There are six major sources of barriers to entry. These are:

Economies of scale

Product differentiation

Capital requirements

Cost disadvantages Independent of size

Access to distribution channels

Government policy

Suppliers:

Suppliers can exert bargaining power on participants in an industry by raising prices or reducing the quality of purchased goods and services. Powerful suppliers, thereby, can squeeze profitability out of an industry unable to recover cost increases in its own prices. The power of each important supplier group depends on a number of characteristics of its market situation and on the relative importance of its sales or purchases to the industry compared with its overall business. A supplier group is powerful if it is dominated by a few companies and is more concentrated than the industry it sells. Also if it poses a credible threat of integrating forward into the industry’s business. This provides a check against the industry’s ability to improve the terms on which it purchases.

Buyers:

Customers likewise can force down prices, demand higher quality or more services, and play competitors off against each other- all at the expense of industry profits. A buyer group is powerful if it is concentrated or purchases in large volume. Large volume buyers are particularly potent forces if heavy fixed costs characterize the industry- as they do in metal containers, corn refining, and bulk chemicals, for example- which raise the stakes to keep capacity filled. The product it purchases from the industry are standard or undifferentiated. The buyers, sure that they always can find alternative suppliers, may play one company against another, as they do in aluminium extrusion. Another case can be when the products the buyer purchases from the industry from a component of its product and represent a significant fraction of its cost. The buyers are likely to shop for a favorable price and purchase selectively. When the products sold by the industry in question is a small fraction of buyers’ costs, buyers are usually much less price sensitive.

Substitutes:

By placing a ceiling on the prices it can charge, substitute products or services limit the potential of an industry. Unless it can upgrade the quality of the product or differentiate it somehow, the industry will suffer in earnings and possibly in growth. Substitutes not only limit profits in normal times but also reduce the bonanaza an industry can reap in boom times. The producers of fiberglass insulation enjoyed unprecedented demand as a result of high energy costs and severe winter weather. But the industry’s ability to raise prices was tempered by the plethora of insulation substitutes, including cellulose, rock wool and Styrofoam.

Rivalry of Taj among established firms:

Oberoi hotels

Leela hotels

ITC Grand

Le Meridien

Bargaining power of buyers is very low.

Bargaining power of suppliers is moderate.

Threat of new enterants:

For Taj, competition in Mumbai has turned fierce as a result of new hotels,

such as ITC Grand Maratha, Le Meridien and Hyatt, coming up close to the

airport, and enjoying tax benefits too.

However in Bangalore, Taj continues to remain at the No.1 position because

of the booming IT sector and lack of five-star rooms, chiefly to accomodate

international passengers.

Potential Entrants

Global hotel groups entry

Buyers

Global tourists

Medical tourists

Industrialist people

Substitutes

Small lodges

THREAT: HIGH (because of new class, Low otherwise)

Customers Need

Good Hospitality

Hygiene food and environment

Success factors for Taj hotels:

Technology related:-Used of advance technology in hotel premises.

Manufacturing- related:- High utilization of fixed assets.

Quality control know-how.

Serving customer according to their specification.

Distribution-related:- Presence of hotel chain at various places.

A strong network.

Marketing related:- Breadth of product line and product selection.

Personalized customer services.

A well-known and well-respected brand name.

SWOT Analysis of TAJ Hotels

Strengths :

Brand loyalty

Credibility

Huge Reputation

Patent protection

Weakness:

High cost service

Not proper network in semi- urban

Lack of safety measure

Opportunity : Rising income

Globalization

New Geographical location

Threats :

Fluctuations in international tourist arrivals

Increasing competition

Terrorism

CONCLUSION

Taj Hotels Resorts and Palaces is one of Asia’s largest and finest group of hotels. The Company is rapidly emerging as a global brand by integrating an international network of luxury hotels within the chain. Taj Hotels is part of the Tata Group, India’s premier business house. Taj Mahal Palace Hotel in Mumbai, India was the subject of many newscasts since November 26,2008.The terrorist attacks not only killed and wounded many, but also caused major damage to the iconic hotel. Tata, a pioneer industrialist and philanthropist, conceived the idea of building a hotel in the wake of the bubonic plague which had devastated Bombay in the late 1890s.Tata’s sole wish was to attract people to India, and incidentally to improve Bombay. The severely damaged hotel has to be rebuilt. The sixth floor is gutted, and many of its restaurants, including the famous Wasabi, burnt and the splendid dome is shaken because of the many explosions. The antique chandeliers and priceless artwork are all lost forever.

But the Taj Mahal Palace and Tower stands as an icon of the city of Mumbai, a symbol of both independence and dignity. It will also stand in the future as a representation of the indomitable human spirit of the people of Mumbai displayed in the face of the greatest adversity.

South Africas gaming industrys gross gambling revenue in financial year 2011/2012 grew by 7.5 to R18.4 billion. In fiscal year 2011/2012 South Africas 37 casinos paid nearly R4.7 billion to government revenue through 36 percent gross casino tax. R10.1 billion was invested in casinos between 1997 to 2000, representing 2.1% of the total South African capital formation. Also, social and responsible gambling programs were funded with more than R80 million (CASA 2012). Presently, there are 830 table games and 22,688 slot machines in all over South Africa’s casinos. Casino industry has generated almost 100,000 direct and indirect new jobs, also adding 7,000 hotel rooms and two international convention centers (CASA 2012).

Montecasino is located in Fourways, North of Johannesburg is known for being Gauteng’s number one entertainment destination. It was first opened on 30 November 2000. Montecasino entertainment complex offers a world class gaming, leisure, entertainment and shopping experience. Montecasino entertainment complex encompasses 3 hotels, The Palazzo Montecasino offering 246 rooms, Southern Sun Montecasino offering 194 rooms & SunSquare Montecasino with 179 rooms. . It was designed and built by South African architect company, Bentel Associates International, at a cost of R1.6 billion rand. It currently attracts over 9.3 million visitors annually. Montecasino has a non-smoking and two smoking casinos, with more than 1700 slot machines and 70 gaming tables, from American Roulette, Craps, Baccarat, Poker and Blackjack to novelty games like Wheel of Fortune and Life of Luxury and progressive slots jackpots. Montecasino is also the largest of Gauteng’s five casinos, covering 38 hectares of prime real estate in the northern suburbs of Johannesburg.

Theme: Monumental Theme

Design: Ancient Tuscan Village (Italian design)

The main building with the casino has a fake sky, painted on the roof, inside going from light to dark from one side to the other.

Political impacts of integrated resorts

Before the introduction of the National Gambling Act in that year, South Africa had a flourishing illegal gambling industry which was almost entirely controlled by whites, offered players no protection against fraud, was readily available to minors and totally ignored problems associated with compulsive and problem gambling. A decade later, illegal machines are down from approximately 150 000 to less than 10 000, while the number of legal machines has increased from the approximately 7 000 which existed in the pre-1996 old “homeland” casinos in 1994 to 22 000 in 2010, a figure which is still well below these which existed illegally.

Today, there are 37 legal casinos in all nine of South Africa’s provinces, bringing numerous benefits to the locations and communities where they operate. The provisions of the National Gambling Act, along with the regulations made in terms of it, have provided South Africa with a regulatory framework which is universally regarded as the most stringent and scrupulous gambling regime in the world.

Social impacts of integrated resorts

The social impact of gambling can range from productivity loss, bankruptcy, crime, suicide, illness, abuse, divorce and separation, social services and treatment costs. The social impact of gambling is not confined to the problem gambler. It most certainly affects others such as spouses, children, extended family members or close friends.

The history of gambling is that of a stigmatized behavior that has passed through numerous cycles of guarded acceptance and prohibition. The recent spread of gambling in South Africa has been characterized by attempts to neutralize the stigma associated with this behavior. Nevertheless, there are very real personal and social problems associated with gambling (COSATU 2012).

Problem gambling. Pathological gambling is a progressive disease that devastates not only the gambler but everyone with whom he or she has a significant relationship. Studies on the impact of gambling found a strong correlation between greater availability of gambling and pathological gambling. Some of the consequences of problem gambling – even if not at a pathological stage – at the personal level can include an increased level of depression and anxiety, impaired judgment, reduced tolerance with other people, and loss of self-respect. Negative effects on work and study can include poor performance, high absenteeism, lower productivity, and unemployment or difficulty in maintaining employment.

Crime. There is positive correlation between crime and gambling. Gambling addicts resort to criminal activities in order to finance their habit. Theft, robbery and fraud are some of the things that problem gamblers sometimes engage in. Gambling is also a haven for organized criminal syndicates. Gambling operators usually refuse to acknowledge this for fear of losing wealthy clients (COSATU 2012).

The South African casino industry is also extensively involved in social investment programs which benefit local communities, particularly the disadvantaged, and in 2010 contributed more than R107 million to this purpose. Such community upliftment programs range from the establishment of trusts to support various local NGO initiatives to the upgrading of infrastructure in less developed areas and regular donations towards charitable and welfare organizations, as well as beneficiaries in the environment, arts, sports, culture and other deserving causes (CASASA 2012).

Economic impacts of integrated resorts

The contribution of the Casino gaming sector to the GDP in South Africa in general, and to the Gauteng province, has been exponential over the years. For example, in the last five years, the gambling Casino industry in South Africa had a total turnover of over R62 billion, with R5.6 billion paid in Casino gaming tax. The total Gross Gaming Revenue increased from R8.2 billion in 2005 to R14 billion in 2009.The increase in revenue was also due in part to more Casinos being licensed throughout South Africa. However, the Gross Gaming Revenue appears to have stabilized, having reached over R15 billion in 2008 and declining by R1 billion in 2009 (Gauteng Gambling Board 2010). During the 2009 financial year, South Africa’s casinos generated quarterly revenue of approximately fifty billion rand, with a full year aggregated figure of two hundred and twelve billion rand (The South African National Gambling Board, 2009).

In terms of the Casino gaming tax, the tax paid increased from R763.7 million in 2005 and the payment for the most being in 2008, but did not decline to R1 billion in 2009. Apart from 2006, the average number of jobs in the Gauteng Casino industry has been at around 11,000.

The industry has also contributed to job creation in the country for example, the employment multiplier of 5.6 would imply that for every one job created directly by the gambling sector, a further 4.6 jobs are created through indirect and indirect effects. The above suggests that the initial employment of 11,093 in 2009 resulted in the total employment of 51 028 through the indirect and induced employment effect of the gambling sector. The total Gross Added Value Added (GVA) of the gambling sector (direct, indirect and induced) is R7.1 billion in Gauteng. (Gauteng Gambling Board 2010).

Technology impacts of integrated resorts

Angel Eye

Designed to put the brakes on a rampant card-switching problem in Asian countries, Angel Eye relies on bar codes placed on each card with invisible ink. As the baccarat dealer deals cards, a sensor in the dealing shoe keeps track of the cards being dealt and transfers the information to a computer. After the cards on the table are revealed, the dealer presses a button on the shoe, and the results of the hand judged by the computer are displayed. Security starts flexing its muscles if the results on the table don’t match the computers.

TableEye21

TableEye21 combines several technologies into a single impressive service: an overhead video camera keeps track of the action, and by using a mixture of video analysis software and information from RFID chips, it’s able to overlay the video feed with real-time information of the cards being dealt and the chips being wagered. In the meantime, TableEye21aˆ?s robust software methodically tracks all kinds of stats for the table, including dealer rounds per hour, trend reports, and player win percentage. Casinos use that information to help identify when a player is counting cards or working in cahoots with the dealer to screw the casino out of money.

Promotion event

Montecasino hosted South Africa Tennis Open for the second time in 2010. It was held for the first time in 2009 at Montecasino, with the venue proving to be catalyst in the restaging of the tournament after 14 years. The R3.5-million event ran from 1 to7 February 2010, with the qualifying tournament taking place on January 30 and 31. The SA Tennis Open is a 250 series event on the ATP World Tour, which means that the winner took away 250 South African Airways world ranking points. South Africa Tennis Association Chief Executive Ian Smith said that the players loved the venue last year, which helped to attract a strong field yet again. The response from the public was overwhelming, with the semifinal and final days (Saturday 6 and Sunday 7 February) being sold out a week before the event.

Celine Dion live show at Montecasino: Thousands of South African fans had flocked to see international Superstar Celine Dion performing live under African skies at Montecasino, Johannesburg on 01 March 2008. The concert was staged adjacent to the spectacular new outdoor piazza in Montecasino, giving the audience the opportunity to experience the magic of Celine Dion in a Tuscan village under African skies.

Streams of revenue

Sources of revenue of Montecasino are: three hotels with a total of 619 rooms; conferencing and meeting facilities that comprise 16 venues totaling 2000 square meters of floor space; the 1 850-seat Teatro; and three restaurants – Billy G’s, a 700-seater buffet restaurant, Cobblestones Pub, a 150 seater pub-style restaurant, and @Monte Restaurant & Wine Bar, an upmarket 120-seat venue. Montecasino’s 95 percent of the R1 billion-plus revenue comes from casino.

Montecasino in 2012 is moving away from the silo approach where the different divisions such as conference venues, hotels, theatres, gaming, entertainment, and restaurants were responsible for their own turnovers and it’s now finding ways to combine offerings for visitors to ensure maximum value and enjoyment for them and improved usage and profitability for Montecasino. Montecasino is focusing on the package offerings they can offer to corporates, associations, clubs, families, or any group. Positive aspect of this realignment exercise are the logistical opportunities to leverage across the extensive company-owned and privately-owned facilities at Montecasino. Montecasino is moving away from the strategy – which saw its various divisions such as gaming, hotels, restaurants and theatres responsible for their own turnovers – towards improved profitability and usage from all its divisions.

Spas
Lanna Spa ( Thai massage)

This Lifestyle spa is stylish and elegant and provides the perfect escape for indulgence and pampering. The name Lanna literally means “land of a million rice fields” and is a temple for the body, mind and soul. Lanna Spa offers a full range of unique treatment services including Clarins Beauty treatments for him and her, Thai Herbal and Oil Massage, Lanna Body Wraps, Manicures and Pedicures, a full range of waxing or simply create your own special package to suit your needs. The decor is simple, yet elegant with a strong Thai influence. There are 9 treatment rooms including a couples room, a relaxation room, a boardroom to meet with clients and indulge them with a pamper session thereafter and a 12 seater Jacuzzi.

Airports play an important economic role within their local communities. Airports serve a significant role in the economic shaping of the communities of which they serve due to the sheer actuality that they are among the largest public facilities in the world. It is well understood that a viable and efficient transportation system is a fundamental and necessary component to the economy of any region (Wells & Young, 2004).

Although there is no doubt that the presence of an airport has great positive impacts on a surrounding community from an economic standpoint, the presence of an airport, much like any large industrial complex, unfortunately impacts the community and surrounding natural environment in what many consider a negative manner. These effects are a result of activity whose sources is the airport itself and of vehicles, as well as both aircraft and ground vehicles, which travel to and from the airport (Wells & Young, 2004).

Examine the political, environmental and social impact an airport has on its local community. Analyze some rules and regulations that govern environmental impact activities, and explain how their strategies help satisfy the needs of the local communities while maintaining sufficient airport operations. Determine and evaluate the role technology plays in mitigating the risks and reducing the environmental impacts created by airport activity. Determine if a relationship exist between community economic growth indicators and airport activity.

Program Outcome addressed by this question.

1. P.O. #1: Students will be able to apply the fundamentals of air transportation as part of a global, multimodal transportation system, including the technological, social, environmental, and political aspects of the system to examine, compare, analyze and recommend conclusion.

A literary review will analyze the environmental impacts of airports on the surrounding communities in which they serve. An evaluation of environmentally related complaints filed against aviation activity and reported to the FAA will determine the most significant environmental impacts associated with airports. Predicting the future of the global multimodal air transportation system is impossible without first understanding the local role and responsibility of each component of the air transportation system. This question will show evidence of satisfying the Program Outcome by demonstrating how the social, economical, political, and environmental fundamentals of an airport are an integral part of the air transportation system, and how these factors contribute to the relationship that an airport has with its surrounding communities.

Research and Analysis

Airports serve a significant role in the political, economic, and social shaping of the communities of which they serve due to the sheer actuality that they are among the largest public facilities in the world.

Political Roles

A major commercial airport is a huge public enterprise. Some are literally cities in their own right, with a great variety of facilities and services (Wells & Young, 2004). Although the administrative functions and responsibilities of these facilities are governed by public entities, airports are also comprised of private dispositions. Commercial airports must be operated in cooperation with the air carriers that provide air transportation service and all airports must work with tenants, such as concessionaires, fixed-based operators (FBOs), and other firms doing business on airport property. This amalgamation of public management and private enterprise fashions a unique political role for airport management (Wells & Young, 2004).

Airline carrier-airport relationships.

One of the most prominent and essential relationships in the aviation industry is the airport airline relationship. When viewing the relationship from the airlines’ standpoint, an airport is a point along their route system for the purpose of enplaning, deplaning, and transferring passengers, cargo, and freight. To facilitate effective and efficient operations, the airlines necessitate specific facilities and services at each airport. The specified requirements of the airports are as varied and unique as the airlines who request them; however, they scarcely remain stagnant, as they are ever changing and evolving to meet the needs of traffic demands, economic conditions, and the competitive climate. Before airline deregulation in 1978, response to changes of this sort was slow and mediated by the regulatory process. Airlines had to apply to the Civil Aeronautics Board (CAB) for permission to add or drop routes or to change fares. CAB deliberations involved published notices, comments from opposing parties, and sometimes hearings that could take months, even years, and all members of the airline airport community were aware of an airline carrier’s intention to make a change long before they received permission from the CAB (Wells & Young, 2004). The Deregulation Act of 1978 enabled air carriers to change their routes and fares without awaiting the approval of the CAB. Many of these changes occurred on short notice, thus causing airline necessities and requirements at airports to change with haste.

Contrary to the viewpoints of air carriers, which operate at multiple airports over a route system connecting many cities, airports concentrate on accommodating the interests of a variety of users at a solitary location. Airport operators and managers have the strenuous task of ensuring that they meet all the demands and requirements of their airline carriers while maintaining their resources. Due to the rapidly changing specifics of each airline carrier, airports often find their services and facilities needing improving or refurbishing, requiring major capital expenditures or even making obsolete an already constructed facility. Airport operators and managers must exercise diligence and caution in realizing that they accommodate and must meet the needs of other tenants and users besides the airline carriers, and must ensure that the airport’s landside facilities are effectively and efficiently utilized. Although the landside facilities are of minimal importance to the airline carriers, their efficiency can severely have an effect on and be affected by their operations.

Despite their notably different perspectives, airline carriers and airports share the collective objective of making the airport a successful and established economic venture in which both parties can benefit and prosper from. Traditionally the relationship between the airline carriers and airports has been formally fused through the use of airport user agreements which establish the circumstances and methodology for establishing, calculating, and collecting usage fees and charges. These agreements are also used to identify the rights and privileges of air carriers, sometimes including the right to approve or disapprove any major proposed airport capital development projects (Wells & Young, 2004). Residual cost airports, or airports where two or more air carriers assume financial risk by agreeing to pay any cost of running the airport that are not allocated to other users, typically have longer-term use agreements than compensatory airports, with agreements of terms of 20 or more years and terms of 30 years or longer not being uncommon. On the other hand, only approximately half of compensatory airports, or airports in which the airport operator assumes the financial risk of running the airport and charges the air carrier fees and rental rates set so as to recover the actual costs, have agreements running for 20 years or more, with many of the compensatory airports having no contractual agreements whatsoever with the airline carriers (Wells & Young, 2004).

Concessionaire-airport relationships.

Another vital relationship which attributes to an airport’s success is the relationship between the airport and the concessionaires. This is due to the fact that the majority of airports rely on their concessionaires in order to generate a considerable amount of their non-aviation related revenues. Airports maintain management contracts and concession agreements with the concessionaires who provided the airport with services and facilities such as banks, restaurants, hotels, car rental companies, parking facilities, bookstores, bars, gift shops, taxi services, and business centers. The context of these agreements varies to a great extent; however, they typically extend the various concessionaires the privilege of operating on the property of the airport in exchange for the greater payment of either a minimal annual fee, or a percentage of the revenues. These agreements can vary from outlet to outlet at the same airport depending upon location, nature of business, forecast turnover and whether or not the outlet is new (Francis et. al, 2004). The tenure of each agreement between the airport and the various concessionaires and the financial circumstances affixed to each will vary by airport and concessionaire. The length of the contractual agreement is dependent upon an array of criteria, with one of the most important being the level of investment required from the retailer. If little investment is required then a contract is often short term; however, if any substantial level of investment is required from the retailer then a contract of five years would be considered the minimum (Freathy & O’Connell, 1999).

A concessionaire who is often overlooked when speaking of concessionaire, despite its critically important role, is the fixed based operator (FBO). FBOs generally provide services for airport firms, users, and tenants lacking facilities of their own, typically through fuel sales, and aircraft repair, service, and maintenance facility operations. The contracts and agreements between airport operators and FBOs vary due to FBOs constructing and developing its own facilities on airport property in some cases, and FBOs simply managing facilities belonging to the airport in other cases.

In addition to concessionaires, some airport authorities serve as landlord to other tenants which may reside and operate on airport property such as industrial parks, freight forwarders, and warehouses, all of which can provide significant revenue. It is the responsibility of airport management to maintain fruitful political relationships with all tenants, by ensuring reasonable lease fees, contract terms, and an overall mix of tenants that meet the needs of the airport and the public it serves (Wells & Young, 2004).

General aviation-airport relationships.

In contrast to airline carriers and concessionaires, contractual agreements are rarely used to characterize and solidify the relationships between airport operators and general aviation (GA). GA is a diverse group which can be comprised of GA aircraft owned and operated by an assortment of organizations and individuals for a miscellaneous number of leisure, business, or instructional purposes. Agreement when they are in place, are seldom long term due to the variety and diversity of owners and aircraft type and use. Airport facilities, in particular storage space such as hangars and tie-downs, are often leased from the airport with the airport playing the role of landlord in a landlord-tenant relationship. Thus, at the airport, the primary needs of GA are parking and storage space, along with facilities for fuel, maintenance, and repair. Whereas as air carrier might occupy a gate for an hour to deplane and enplane passengers and load fuel, a GA user might need to have property space to park an aircraft for a day or more (Wells & Young, 2004).

Airport-public relations.

Indubitably, one of the most vital and challenging relationships that an airport must foster and maintain, is the relationship between the airport and its community it serves. The overall goal of the airport must be to create goodwill and a positive reputation for the airport and its products, services, and ideals with the community, who can affect its present and future welfare. Without regards to the size, location, or activity scope of an airport, every airport four publics in which it must deal with. These publics include the 1) external business public, which includes all segments of the business, government, educational, and general flying public; the 2) external general public, which is all the local citizens and taxpayer, many of whom have never been to the airport but who vote on airport issues or who represent citizens groups with particular concerns; the 3) internal business public, which includes the businesses and enterprises who interests are tied directly to the airport-the airlines, FBOs, other members of the GA community, government officials, and other aviation and travel-oriented local businesses and trade organizations, and the employees of all these enterprises; and the 4) internal employee public comprised of everyone who works for the airport and its parent organization (Wells & Young, 2004). Like any other facility that is a part of and serves the total community, the airport requires total understanding by its community and publics, and must ensure that it creates an environment and atmosphere of awareness and acceptance.

Airport regulatory policies.

The airport has many organizations who are profoundly interested in their operations, and in developing and preserving airports due to their role in the national air transportation system and their value to the communities and publics they serve. The primary goal of these groups is to provide political support for their causes with hopes to influence federal, state, and local laws concerning airports and aviation operations in their favor (Wells & Young, 2004). Some of the most prominent groups include the Aerospace Industries Association (AIA), the Aircraft Owners and Pilots Association (AOPA), the Air Line Pilots Association (ALPA), the Airports Council International-North America (ACI-NA), the Air Transport Association of America (ATA), the American Association of Airport Executives (AAAE), the Aviation Distributors and Manufacturers Association (ADMA), the Experimental Aircraft Association (EAA), the Flight Safety Foundation (FSF), the General Aviation Manufacturers Association (GAMA), the Helicopter Association International (HAI), the International Air Transport Association (IATA), the National Agricultural Aviation Association (NAAA), the National Air Transportation Association (NATA), the National Association of State Aviation Officials (NASAO), the National Business Aviation Association (NBAA), the Professional Aviation Maintenance Association (PAMA), and the Regional Airline Association (RAA).

Economic Roles

Unquestionably, airports are economic locomotives and a reflection of the community, publics, and region in which they reside, serve, and represent. Transportation, by definition, provides the ability for people and goods to move between communities, thus leading to trade and commerce between markets, which in turn, lead to jobs, earnings, and overall economic benefit for a community’s residents (Wells & Young, 2004).

Transportation role.

Despite the fact that there are numerous modes of transportations, to include automobiles, trains, trucks, and ships, air travel has had a significant impact on trade and commerce that is absolutely unrivaled by any other transportation mode. In comparison to their sister modes of transportation, travel in the aviation system allows substantial amounts of passengers and cargo to travel internationally in relatively short periods of time, resulting in communities garnering extraordinary and exceptional economic benefit through providing them access to various world-wide markets.

Stimulating economic growth.

The airport has become vital to the growth of business and industry in a community by providing air access for companies that must meet the demands of supply, competition, and expanding marketing areas. Economic impacts of airports are measured according to direct impact and indirect, or induced, impact. Directs impacts include the economic activities carried out at the airport by airline carriers, airport management and operators, FBOs, and other firms, and tenants with a direct involvement with aviation. Airports and the agencies and tenants that directly impact the airports represent a major source of employment for their various outlying communities, with the wages and salaries earned by the employees of airport-related business having a significant direct economic impact on the local communities’ economy by providing the means to purchase goods and services while generating tax revenues as well. Local payrolls are not the only measure of an airport’s economic benefit to the community. In addition, the employee expenditures generate successive waves of additional employment and purchases that are more difficult to measure, yet nevertheless substantial (Wells & Young, 2004).

Total Airport Earnings and Employment (Earnings in Millions)

Category Earnings Jobs

Salaries $208.91 4,870

Local Fuel Purchases $3.99 237

Local Non-Fuel Purchases $4.23 252

Rent $18.35 723

Equipment Purchases $1.39 82

Utilities $8.07 318

Contractual Services $41.77 1,647

State Taxes $10.16 125

Local Taxes $27.42 338

Other Spending $73.14 901

Hotel Spending $42.20 2,234

Construction $19.11 743

Total $458.74 12,471

* Totals may not add due to rounding

Table 1: Louis Armstrong New Orleans International Airport (MSY) 2004 earnings and employment. Taken from MSY 2004 Airport Report

In addition to the direct economic impact generated by the airport, the outlying communities receive indirect, or induced, impact generated by economic activities by on-airport businesses and off-airport business activities associated with the airport through-put, such as hotels, gas stations, restaurants, and travel agencies, as well their roles in facilitating trade and tourism, among others. The airport also indirectly supports the local economy through the use of local services for air cargo, food catering to the airlines, aircraft maintenance, and ground transportation on and around the airport, as regular purchases of fuel, food, goods, supplies, equipment, and other services permeate additional income into the communities surrounding the airport. The local economy’s tourism and business convention industry can also receive economic growth and substantial revenues indirectly impacted by the airport through air travelers’ patronage and use of hotels, restaurants, retail stores, sports and night clubs, rental cars, and local transportation, among others.

Beyond the benefits that an airport brings to the community as a transportation facility and as a local industry, the airport has become a significant factor in the determination of real estate values in adjacent areas. Land located near airports almost always increases in value as the local economy begins to benefit from the presence of the airport. Land developers consistently seek land near airports, and it follows inexorably that a new airport will inspire extensive construction around it (Wells & Young, 2004).

TOTAL TAX REVENUE CREATED (In millions of $s)

CATEGORY INCOME

State

Direct $9.95

Income $7.18

Selective Sales $7.52

General Sales $8.90

Business $2.48

Total State $36.04

Local Sales $10.57

Local Direct $23.83

Local Property Taxes $0.97

Total Local $35.38

State Plus Local $71.41

* Totals may not add due to rounding

Table 2: MSY Tax revenue created 2004. Taken from MSY 2004 Airport Report

Airports are a major force and contributor to the local, regional, and national economy with an impact that goes well beyond the actual physical boundaries of the airport. As cargo and passenger continue to rise, and infrastructure continue to improve, the importance and impacts of airports as economic catalyst will also continue to increase.

Environmental Roles

Although there is no doubt that the presence of an airport has great positive impacts on a surrounding community from an economic standpoint, the presence of an airport, much like any large industrial complex, unfortunately impacts the community and surrounding natural environment in what many consider a negative manner. These effects are a result of activity whose sources is the airport itself and of vehicles, as well as both aircraft and ground vehicles, which travel to and from the airport (Wells & Young, 2004).

Noise Impacts.

Conceivably the most noteworthy environmental impact associated with airports is the noise emanated by the taking off and landing of aircraft, with engine maintenance and taxiing aircraft following closely behind. The impact of such noise on communities is usually analyzed in terms of the extent to which the noise annoys people by interfering with their normal activities, such as sleep, relaxation, speech, television, school, and business operations (GAO, 2000). According to a 1978 study that has become the generally accepted model for assessing the effects of long-term noise exposure, when sound exposure levels are measured by the method that assigns additional weight to sounds occurring at night (between 10 p.m. and 7 a.m.), and those sound levels exceed 65 decibels, individuals report a noticeable increase in annoyance (Schultz, 1978). There is increasing evidence that high exposure to noise has adverse psychological and physiological effects and that people repeatedly exposed to loud noises might exhibit high stress levels, nervous tension, and inability to concentrate (Wells & Young, 2004).

Since the beginning of aviation, airports have always had conflicts with their neighboring communities; however, noise did not become an issue until the 1960s introduction of the commercial jet. It is estimated by the Federal Aviation Administration (FAA) that between 1960 and 1970, the land area affected by aviation-related noise and the complaints they received with noise as the culprit increased sevenfold.