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Key Drivers for Change


The following are the five (5) global drivers that will shape the world of 2020 and their relevance to tourism:
Globalization and Long-term Economic Trends
§ A growing world economy – projections show that the world economy is likely to continue growing
remarkably at least to 2020. Large parts of the globe will benefit from gains in the world economy.
Economic dynamism (changes in economic system over time) is expected to be broadly based worldwide
but should be strongest among emerging markets, especially in the two (2) Asian giants, China and India.
§ Globalization – it refers to the growing interconnectedness reflected in the expanded flows of information,
technology, capital, goods, services, and people throughout the world. It is the result of the revolutions in
telecommunications and computing; increased international connectivity will continue to change the
shape of modern life, further diminishing the constraints of physical boundaries and expanding the
geographical scope of social networks.
Relevance for tourism
Globalization results to easier access across borders, which for the tourism industry may mean more foreign
tourists as well as increased global competition from international tourist destinations. Moreover,
globalization influences tourism in various ways:
o The projected dynamic world economy is forecasted to provide the basis for increased international
and domestic tourism. Studies indicate that rising income is the most powerful generator of tourism
flows (Crouch, 1994; Lim, 1999).
o Economic growth and greater spending power, combined with greater available leisure time will allow
greater number of people with the opportunity to travel.
o Dispersion of technology will enhance the competitive advantage of destinations comprised of
tourism businesses that operates strategically to gain visitors.
o Global firms will require a global workforce that will increase movements of people to developed
economies and a growing number of migrant workers (NIC, 1999). This increase in mobility of business
will lead to high rates of growth in business travel.
Social Trends
The social factors that are likely to influence tourism in the coming years can be divided into three (3)
subcategories: social values of society, lifestyles, and demographics. Social factors are closely interconnected
with cultural ones, since individuals are part of larger social groups that influence their behavior, which are
also part of and affected by a surrounding culture.
§ Population and ageing – increased life expectancy and falling fertility rates in the advanced and emerging
market economies result to an ageing population. By 2020, one (1) out of eight (8) people will be 60 years
old or over. Age complexity is occurring; children are growing up faster but more adults want to be
teenagers. Products for children will need to have cool teen attributes. Adults are behaving more like
teenagers in eating habits and pastimes.
§ Urbanization – there is a worldwide trend towards urbanization (increased number of people who live in
urban areas). More than 95% of the increase in world population will be found in developing countries. By
2020, more than 60% of people will live in cities. The number of very large cities (megalopolises) will
double, which will be a significant problem.
§ Changing social structures – family households are getting smaller and sole-parent and single-person
households are becoming more common. A family will include any combination of two (2) or more people
living in a domestic household comprising a minimum of two (2) adults, or one (1) adult and one (1) child.

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§ Health – high standards of public health in developed countries have contributed to increased longevity.
Although older people are more likely to have disabilities than younger people, most who are in their 60s
and 70s appear to be in good health and lead productive lives. Also, an ageing population will increase the
need for healthcare combined with recovery in attractive locations.

§ Values and lifestyles – it is expected that economic development will continue to cause shifts in the values
of people. Among the changes are as follows:
o Money rich/time poor – increasing number of people will be money rich/time poor (people value the
time they spent in various activities, and will not waste time in unproductive ones).
o Individualism - increasing demand for customized products, services, and experiences.
o Seek a variety of experience – consumers will seek newer/richer/deeper experiences.
o Experimental – people will be more experimental with products, foods, and attractions, but would not
give a second chance to a product or service that fails to satisfy.
o Seek value for money – consumers will have increased access to information on pricing through the
internet, thus consumer marketing battle is likely to shift from competitive pricing towards service
improvement.
o Safety conscious – safety issues will be increasingly important; consumers demand assurance of safe
products and services prior to purchase.
o Social and environmental concern – the public awareness of socio-cultural and environmental issues
will continue.
§ Changing work patterns – people are demanding work flexibility and are not willing to sacrifice their
personal and family-related goals for their careers. Demographic trends will need to develop ways for
older people to stay in the workforce longer since generations X and Y prefer to own businesses and have
little or no loyalty to their employers.

§ Gender – society will become more feminized. More women will have university degrees, marry later or
stay single, and enjoy increased earning power; men are becoming more feminized, take a more active
role in parenting, are more fashion-oriented, and develop beauty regimes, including plastic surgery.
Women will have increasing influence on key decisions in purchasing goods and services.

§ Education – the globalized economy will require a more highly skilled labor force. Education will be
influential on the success of destinations and businesses. Good management will replace marketing as the
key for business success. Greater investment in technology, distribution systems, equipment, and
investment in human resources will be required.

Relevance for tourism


o The growing urban congestion in both the industrialized and developing worlds leads to the
increasingly felt need to engage in tourism to escape and/or to indulge.
o Tourists are becoming more critical, less loyal, and value-conscious (they seek value for money, not
necessarily low prices).
o The family holiday remains, but the greater growth will occur in holidays for the retired and single
people.
o Parallel to changes in demography are changes in tastes; holidays are becoming more specialized, and
increasingly carry with them some kind of educational or cultural experience.
o Changing work patterns allow for more flexibility in travel plans.

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Political Trends
In terms of political trends, what matters most are its effects to tourism. According to the World Travel &
Tourism Council (WTTC), political issues tend to have the greatest effect on tourism since these last for a long
time.
§ Terrorism – one of the biggest threats to tourism development is the threat of terrorism. Terrorism and
internal conflicts can interrupt the process of globalization by significantly increasing security costs
associated with international commerce, encouraging restrictive border control policies, and adversely
affecting trade patterns and financial markets.
Cyber terrorism – there is an expected increase in cyber terrorism to damage computer systems and
interrupt critical information networks. The key cyber battleground of the future will be the
information on computer systems, which is more valuable and susceptible than physical systems.
Border control – due to devastating terrorist attacks, politicians across the world demonstrate their
commitment to securing borders, which creates barrier to tourism.
§ Health risks and security – the steady increase in international travel is a driving force in the global
emergence and spread of infectious diseases (Perz, Allen, & Schaffner, 2001). Growth in international
travel and tourism will bring with it, among other things, the unprecedented risk of infectious diseases
and other health-related crises. However, economic pressures to promote tourism mean that even the
most dangerous, infected, and poverty-stricken countries are still vying for tourists.
§ Governance – with regard to national and international governance, established governments are likely to
lose some control over their borders as migrants, technology, disease, weapons, financial transactions,
and information of all kinds move around the world. Effective governments in 2020 are likely to profit
from opportunistic new partnerships, while incompetent governments are more likely to struggle
(Johnson, 2001).
Relevance for tourism
o Destinations that are perceived to be less safe and secure will be avoided by tourists.
o Conflicts in and around fuel-supplying countries like Middle East have capacity to substantially
increase fuel costs of travel.
o Tourism’s vulnerability raises the need to have effectively implemented disaster management
strategies, particularly at the destination level.
o There is a growing need for enterprise and government cyber security and biosecurity to decrease risk
of cyber terrorism.
o Marketers of destinations affected by real or perceived risk factors may need to target tourists with a
higher tolerance of risk.

Environmental Trends
Current environmental problems will persist and in many instances grow over the future. All countries are
likely to face intensified environmental problems as a result of population growth, economic development,
greenhouse gas emissions, and rapid urbanization.
§ Climate change – it has become, and will continue to be one (1) of the most concerning and controversial
environmental challenges. Climate change generally refers to significant changes in long-term average
weather patterns, which in turn shifts the climatic characteristic of a region over time to new conditions.
Fortunately, there is a growing awareness that continuing growth under business-as-usual conditions is
not sustainable for the environment, or for future economic development. Changes are needed to lessen
and, in many cases, adapt to new conditions brought by climate change. Impacts of climate change and

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warming trends include sea-level rise, changes to ocean currents, glacial and polar ice melts, loss of snow
cover, high heat index and high daytime temperatures, and changes to precipitation patterns.
§ Depletion of natural resources – due to population growth and economic development, the biological and
physical resources of the Earth are being degraded. Affected resources include agriculture and food
resources, energy, water, and land use. Fossil-fuel based energy source will become more expensive; the
demand for energy efficiency and investment in renewable forms of energy is set to increase. Water
shortages will leave over half the world’s population facing water-stress. Demand for higher food
production will increase impacts of extensive and intensive forms of agriculture.
§ Loss of biodiversity – species loss is increasing due to population pressure and loss of habitat, pollution
and over-hunting. Since many native species need specific environmental conditions to survive, loss of
habitat is the main cause for some endemic specie being lost from local areas. This can lead to extinction
if happened in several regions.
Relevance for tourism
The natural environment and climate conditions are very important in determining the viability and
attractiveness of a tourist destination. Tourism developments have a tendency to be built near attractive
or unique features of the environment, enabling visitors to gain easier access to interesting natural or
man-made environment. Climate change will influence which destinations tourists will prefer and which
ones will cease to be as attractive. Below are some examples of how climate change will impact tourism
destinations in the future:
o Improvements in summer conditions could trigger more domestic holidays. Warmer and more reliable
summers also provide increased incentives for those in hotter regions to travel to destinations with
more favorable summer conditions.
o For the ski industry, warmer, wetter winters result to a decline in the number of days of reliable snow
cover, creating capacity pressures for higher altitude ski resorts.
o Reduction in tourist numbers among traditional mid-summer destinations due to excessive heat; an
increase in tourist numbers for more temperate destinations.
o Potential for substantial damage to tourist facilities and disruptions of services during or following
bushfires or other extreme weather events (storms, flooding).
o Decreased aesthetic value of coral reefs due to coral bleaching (process where coral colonies lose their
color; when water is too warm, corals will expel the algae living in their tissue causing the coral to turn
completely white [http://oceanservice.noaa.gov/]).
o Possibility of decline in dive and beach markets.
o Disruptions in nature-based tourism, such as visits to national parks.

Technology Trends
Knowledge will become an even more important asset in economies and businesses in the future. Over the
next few years, the world will encounter more quantum leaps in information and communication technology
(ICT) and in other areas of science and technology. The strategic question is how to set up information
technology for strategic advantage.
§ New internet technologies are agents of the consumer; with Web2.0 (phenomenon of convergence of
social trends and technology making applications run more like desktop applications) being common,
websites with user-generated content are widespread, increasing collaborations among online
consumers.
§ ICT trends have one (1) outcome: print to digital. The trends have improved the growth of e-tourist
communities, which are self-publishing through blogs, trip diaries, and videos.

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§ The smartest e-destinations include all ICTs to assist visitors. For example, drive trip planners may have
themed drives for specific interest groups, integrated with accommodation and attractions.
§ E-communities may advertise for a destination/operator. Therefore, it is important that suppliers analyze
and respond to reviews of their products and services.
§ With Web 3.0 or the ‘semantic web’, internet capability is advancing from simple online travel booking to
advanced content and collaboration to artificial intelligence systems (AIS). This will close the gap between
on- and offline travel services as it has the capacity to provide tailored information to the potential tourist,
which travel agents do.

Relevance of ICT for tourism


o ICT can give operators a better understanding of consumer needs because of research interaction and
data mining; thus, allowing differentiation and customization according to personal preferences.
o Interactive access to product offering via the internet gives tourists extraordinary control over how
they spend their time and money. Destinations and tourism organizations that do not embrace the
internet will lose competitiveness.
o The facilitation of booking travel and tourism through electronic technology allows more suppliers to
increase their direct sales, bypassing the travel agent/intermediary.
o Intelligent agent computer programs that are a combination of pre-entered information (e.g. likes and
dislikes in terms of holidays) and observed behaviors in the use of online booking patterns are able to
make suggestions on possible options for a user; thus, saving time in surfing the internet.
o CD-ROMs (Compact Disc Read-Only Memory) are likely to be increasingly used as electronic brochures,
saving time in the inspection of paper brochures.
o The development of surrounding technologies and mobile devices providing the mobile internet will
empower visitors/customers by providing location and time-dependent information, offers, and
services.
Relevance of transport technology for tourism
ICT affects transportation in a variety of ways. It plays a major role in bringing about improvements in transport
operations, asset management, and the delivery of major services and programs. Improvements in
transportation have widely eased travel, making areas once difficult to reach accessible.
o Faster and more comfortable transport is increasing the accessibility of destinations worldwide.
o New technology is enhancing the speed and reducing the real cost of travel. More fuel-efficient aircraft
will progressively reduce real costs of international travel.
o Improvements in efficiency, safety, and range of travel are ongoing. Larger aircraft for non-stop long
flights will likely be increasingly demanded by customers that value comfort.
o Future developments will involve even larger capacity aircraft and better matching of aircraft types
according to demand.
o The development of low-cost carriers has increased the demand for air travel but with an emphasis
on price rather than comfort.
o With the environmental advantages and the developments of high-speed train networks, it is likely
that travel by train will increase.

Reference:
Lifted and modified from: Megatrends Underpinning Tourism to 2020. Analysis of key drivers for change [PDF
file]. (2008). CRC for Sustainable Tourism Pty Ltd. Retrieved from
http://www.sustainabletourismonline.com/awms/Upload/Resource/bookshop/80046%20Dwyer_TourismTre
nds2020%20WEB.pdf on 03 June 2016

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