1,000 years ago, New York was the largest city followed by Tokyo. Travelling was a time consuming and costly activity. To plan for travel, the traveler must first go to the library to look up the contact information for travel agents in the Yellow Pages then send out letters to the travel agent to set up a meeting. After discussing travel plans with the travel agent, the travel agent then sends out letters overseas to the travel agents at the destination and wait for a response. These letters could take three months or more to reach the destination at a price of around $1,000. Planning for the entire trip can take up a year or more. In time, the invention of the telegraph, telex, and fax would make the necessary communications more convenient.

Travel resulted from the need for food, community, to build art, obtain a better life, develop new tools, and used for construction.  Without the need of travel to move from one place to another, humanity would not have been the same.  This caused war, but once communities were established people started to travel to visit one another for exploration and or trade. On December 7, 1903, the first airplane was flown in North Carolina. In the 1970’s-1980’s travel was the largest industry. This then caused economies when people traded.  Kings and rulers realized they could make money. Tax started from criminals because they could.  Unless the communities could fight it, they stayed.

Travel is now the largest industry in the world.  It is defined as the movement of a person from one place to another. Travel is also the fastest growing industry with 10% of all newly created jobs taking place in the travel industry.  It’s creating 1 in every 12 jobs in the world. Furthermore, the travel industry contributes to 9.1% of the world’s total GDP.That’s 6.6 trillion and growing faster than the world economy. Making it double the size of auto manufacturing and 1/3 larger than chemical manufacturing.

There are three types of travel: leisure, business, and ethnic. Leisure travel is when people travel to explore and have fun, it is about 50% of the travel industry. Business travel are trips taken to execute business, whether to sell, buy or exchange goods or services and is about 30% of the industry. Lastly, ethnic travel is when people move from one place to another often to visit family. Ethnic travel is currently 20% of the industry but is also the fastest growing segment because of globalization and the need for people to travel to visit family. It is expected that by 2020, ethnic travel will exceed business travel.

The main reason people travel in groups is because they are afraid of being in a place where they can’t speak the language.  You cannot diverge from the program.  In an optional tour, guides are making their money; set tours offered by different times, free day, and commission for showing vendors.  Usually handicap people will not go in a group unless it is a special bus. Parking Cost is fixed between passenger and national parks; Divided by everyone in a group;

Reasons for cancellations:

  • Cancel Tour
  • Find Other People
  • Move to another Tour/Date
  • Increase Price

1/3 of Travel is USA.  The average life expectancy is now until 82.  There are now 100 Chinese million travelers outside of the world.  India, Japan, Korea, Germany, UK, and Spain have been great travel destinations. In the last ten years, China (1.4 Billion), India (1.2 Billion), and Russia (200 Million) to make 3 billion travelers.  China is more capitalistic where India is more democratic and socialistic.  Russia has been bridging the closeness with the rest of Europe.  Food pricing goes up when fuel does.

  1. 35-55 Age group = income
  2. Still Exploring 55-70 (40%)
  3. 70+ = Don’t Make
  4. 18-35 Biggest Change (30%)

More airlines making brochures in Chinese; Changes languages and destinations. The Middle Class is five times bigger from 100 Million to 500 Million people.  Most of them can afford a car and eat steak.  Saudi creates political instability though to reduced public rigs and increased pricing. People started traveling in the United States. People started traveling in US. Travel agents started disappear OTA’s started here, booking can price lines expedia. Unit price for travel is bigger and the type of traveler has fewer destinations, but more units. Smaller amount and unit. The use of technology for service and delivery.  Autos, airplanes, ships with engines, and the US create trends.  Americans don’t travel due to lack of vacations. Japan accepts Starbucks more than Asia.

Supply: Destination, Travel Agency

Demand: Travelers, Businesses, Schools, Government, Associations, and Travel Agency

Wal-Mart is the largest company in the world because of the number of employees, and #of turnover.  Travel Industry Structure consists of supply and demand.

Make this a pyramid!

Your target is the vision and your mission is how to get there. What tactics can you use?

Supplier Model-Users


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