Emerging markets penetration - the use of networks by tour operators

Zhang, J. and Lynch, P.A.; (2008) Emerging markets penetration - the use of networks by tour operators. In: Conference Proceedings of the 17th Annual CHME Research Conference. The Scottish Hotel School, University of Strathclyde, Glasgow, pp. 674-687. ISBN 0-9548039-1-4

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Driven by structural and demographic changes in both affluent economies and shaping new world economic powers, the dynamism of world tourism is expected to continue in the coming decades. In terms of source markets, although international tourism is still relativley concentrated in the industrialized nations in Europe, North America and Asia and Pacific region. Ther emerging economies have shown a substantial proliferation of tourist-generating ability in the last few years (World Tourism Organization, 2005). Many tourism scholars predicted that the increasing transparency of information conveyed by the internet would diminish tour operator's traditional risk brokerage function. Their position within the tourism value chain was expected to decline significantly. Yet, at the global scale, it is observed that tour operators have remained influential over international tourism flow and been highly active in the exploration of emerging markets. Against this background, addressing the emerging market penetration issue for tourism firms is deemed to be theoretically significant and bearing real value to businesses. This study examines the underlying theoretical mechanism of internationalisation with respect to their suitability to tour operators' market penetration to emerging economies. While recognising the value of different approaches, it is found that the network approach is most apt in the intricate institutional setting of emerging economies. The study goes further offering a theoretical framework integrating both industrial and special networks and examining the conditions unde which those nexus are the most effective. China is chosen as the analytical setting for this study. As the world's largest emerging economy, it is not surprising that China has received much interest from the industry owing to its substantial scale of economy, expotential rate of growth and perhaps the most appealing above all, the sheer size of its booming domestic and outbound markets.