Trends and Issues in Hospitality and Tourism

Trends and Issues in Hospitality and Tourism
Lesson Objectives:
At the end of this module, I should be able to:
1. Identify the issues that owners and managers of the tourism and
hospitality establishments are likely to face.
2. Identify possible steps to address the major issues confronting the

industry.
Issues in Tourism Industry
The tourism and hospitality is not immune to problems and these issues can
be categorized into five: marketing, legal, human resources; operations and
consumer affairs.
Marketing issues
The marketing issues being faced by the tourism and hospitality industry are
changing
demographics, changing vacation patterns, market segmentation, frequent

guests programs, maturation in segments of the fast food industry and
consolidation.
Changing Demographics
• Aging population in developed countries: The aging population, currently

33 years, necessitates service providers to adapt their products to changing
market preferences.
• Increase in single-parent households: This segment, typically with lower

discretionary income, requires new, affordable service products.
• Growth in personal travel: Approximately 74% of domestic travelers travel

for nonbusiness purposes, contributing to the increased travel market.
• Growth in international travelers: Reduced transportation costs, increased

vacation time, and more holidays make travel more affordable.
Changing Vacation Patterns

Citizens of industrialized countries are changing their vacation patterns. The
traditional once-a-year vacation of two weeks is declining in popularity. For a
growing number of people, vacations are becoming shorter and more
frequent. At present, more people usually plan mini-vacations, adding two of
their annual vacation days to a three-day holiday weekend. In this way, they
manage to get away for a mini-vacation of five days while using only two
actual vacation days.
Market Segmentation
• Marketing segmentation has been the primary term in tourism marketing

since 1980.
• Prior to the late 1970s, lodging establishments aimed to appeal to broad

general markets.
• Success of limited-service properties led to the development of properties

targeting specific market segments.
• Types of lodge properties include all-suite, residence, sub-budget, and

budget properties.
• Market segmentation is evident in food service, with restaurants offering

specialized service products reducing business.
• As new market segments are identified, properties catering to these

segments are likely to be developed.
Frequent Guest Programs
Because of the proliferation of properties and the increasing competition

among them, some lodging operators have begun to develop programs to
gain repeat business. Modeled on the frequent-flyer programs that were
successfully used by many airline companies, these plans give credit to
regular guests. They can be redeemed in the form of reduced rates,
upgrades, free accommodations, free meals, or any variety of amenities. As
competition becomes keener, the number of these kinds of programs will
certainly grow. Many believe that these programs will gain in the lodging
business the same favor that they have achieved among airline customers.
Maturation in Segments of the Fast-food Industry
Segments of the fast-food industry are no longer expanding to the extent

that was formerly possible. The demand for hamburgers is not growing as
fast as it once did, so operators find it necessary to develop new products to
maintain the desired sales level. At present, establishments that previously
offered few products to other than hamburgers now offer pizza, salads,
poultry, or other meat products. As public tastes continue to change, food
service operators will have to develop specialty products to retain an
adequate share of the market.
Consolidation in the Commercial Lodging Industry
• Predictions suggest a decrease in large nationwide lodging companies.
• Small firms expected to dominate by acquiring regional or national

properties.
• Successful companies will secure funds for international expansion.
• Impacts all commercial lodging operations, making it difficult for

independent operations and smaller chain owners to compete with heavily
advertised brands.
Legal Issues
Liquor Liability
• Public concern over alcohol-related accidents led to state legislatures

lowering blood alcohol levels and increasing penalties.
• New regulations have made the discounting of drinks, or happy hour, illegal
in some US states.
• Establishments can be held financially accountable if they serve alcoholic

beverages to intoxicated individuals causing damage or injury.
• Some restaurants and bars now promote non-alcoholic drinks.
• As societal attitudes towards alcoholic drinks change, food service and

lodging operators must adapt.
Ethics in the Tourism and Hospitality
• Ethics is an academic discipline studying moral conduct codes.
• Business ethics applies a specific moral code to business relationships and

activities.
• It helps distinguish right from wrong and unethical behavior.
• Ethics in tourism and hospitality industry has been a concern for centuries.
• Issues include unethical practices like hiring excessively many waiters,

failing to report all sales, and accepting gifts in exchange for inferior
products.
• Business ethics remains a significant concern in the tourism and hospitality

industry.
Human Resources
Some human resource issues are sexual harassment, employee turnover,

employee assistance plans, and employee empowerment.
Sexual Harassment
Sexual harassment may be defined as unwelcome sexual advances, requests

for sexual favors and other verbal or physical conduct of a sexual nature that
takes place under any of the following conditions:
1. Submission is made a condition of the person's employment;
2. Submission to or rejection of such conduct is used as a basis for

employment discussions
affecting the person; and
3. It unreasonably interferes with the person's work performance or creates

an intimidating, hostile, or offensive work environment.
Most cases of sexual harassment involve complaints by females about co-

workers or superiors. In the last 10 years, the number of cases has grown
because an increasing number of women have become willing to speak out.
Employee Turnover
• High turnover rates of approximately 100% per year.
• Managers face the challenge of losing experienced employees and hiring

less experienced ones.
• Many managers believe they have to shoulder high training costs or work
with untrained employees.
• There is a third alternative: retaining valuable employees and reducing

turnovers.
• Requirements to reduce turnovers include adequate wages, benefits,

reasonable working conditions, work schedules, and reasonable treatment.
• However, few managers implement these requirements.
Employee Assistance Plans
Employee Assistance Plans (EAPs) are crucial in the tourism and hospitality
industry to address employees' psychological, family, financial, legal, health,
and educational issues. By implementing EAPs, managers can foster a loyal
workforce, resolute in achieving operational goals, and reduce employee
turnover. This secular approach addresses various problems faced by
employees in the industry, ensuring a more productive and satisfied
workforce.
Employee Empowerment
• Strict rules and procedures in tourism establishments can negatively

impact guest impressions.
• These rules can include inflexible checkout time, coffee refill restrictions,
hand towel limit restrictions, and substitution prohibitions.
• Many managers now set guest-oriented policies, empowering employees to

improve service quality without negatively impacting operations.
Operations
The operations issues are automation, smoking/nonsmoking areas, sanitation

and public health, and recycling solid waste.
Automation
• Automation involves using electronic and mechanical equipment to

complete tasks.
• Main reasons for automation include increasing speed and reducing costs.
• Automation in travel industry includes communication, interactive

television, and ticket elimination.
• Food service and lodging establishments have automated, eliminating

direct contact with staff.
• Check-in and check-out processes are automated, with guest input and
touch-sensitive screen options.
• Food and beverages can be taken from vending machines.

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Trends and Issues in Hospitality and Tourism

At the end of this module, I should be able to:

2. Identify possible steps to address the major issues confronting the

Issues in Tourism Industry

demographics, changing vacation patterns, market segmentation, frequent

• Aging population in developed countries: The aging population, currently

• Increase in single-parent households: This segment, typically with lower

• Growth in personal travel: Approximately 74% of domestic travelers travel

• Growth in international travelers: Reduced transportation costs, increased

Changing Vacation Patterns

• Marketing segmentation has been the primary term in tourism marketing

• Prior to the late 1970s, lodging establishments aimed to appeal to broad

• Success of limited-service properties led to the development of properties

• Types of lodge properties include all-suite, residence, sub-budget, and

• Market segmentation is evident in food service, with restaurants offering

• As new market segments are identified, properties catering to these

Frequent Guest Programs

Because of the proliferation of properties and the increasing competition

Segments of the fast-food industry are no longer expanding to the extent

Consolidation in the Commercial Lodging Industry

• Predictions suggest a decrease in large nationwide lodging companies.

• Small firms expected to dominate by acquiring regional or national

• Successful companies will secure funds for international expansion.

• Impacts all commercial lodging operations, making it difficult for

• Public concern over alcohol-related accidents led to state legislatures

• Establishments can be held financially accountable if they serve alcoholic

• Some restaurants and bars now promote non-alcoholic drinks.

• As societal attitudes towards alcoholic drinks change, food service and

• Ethics is an academic discipline studying moral conduct codes.

• Business ethics applies a specific moral code to business relationships and

• It helps distinguish right from wrong and unethical behavior.

• Issues include unethical practices like hiring excessively many waiters,

• Business ethics remains a significant concern in the tourism and hospitality

Some human resource issues are sexual harassment, employee turnover,

Sexual harassment may be defined as unwelcome sexual advances, requests

1. Submission is made a condition of the person's employment;

2. Submission to or rejection of such conduct is used as a basis for

affecting the person; and

3. It unreasonably interferes with the person's work performance or creates

Most cases of sexual harassment involve complaints by females about co-

• Managers face the challenge of losing experienced employees and hiring

• There is a third alternative: retaining valuable employees and reducing

• Requirements to reduce turnovers include adequate wages, benefits,

• However, few managers implement these requirements.

Employee Assistance Plans

• Strict rules and procedures in tourism establishments can negatively

• Many managers now set guest-oriented policies, empowering employees to

The operations issues are automation, smoking/nonsmoking areas, sanitation

• Automation involves using electronic and mechanical equipment to

• Automation in travel industry includes communication, interactive

• Food service and lodging establishments have automated, eliminating

• Food and beverages can be taken from vending machines.

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