Strengthening Tourism SME Brands

This study develops propositions for a benchmarking exercise involving SME and tourism destination brands. In order to reveal the role of SMEs at destinations and their role in the destination brand, the tourism production process is analysed. It is suggested to view destinations as virtual service firms (VSF) as this highlights the interdependencies between SMEs, but also allows the description of how tourists manage to create value chains for themselves. Within the construct of the VSF it becomes possible to address the issue how SMEs can begin to capture tourists’ value chain while developing differentiated clusters of tourism SMEs. Introduction SMEs involved in tourism often rely on the strength and attractiveness of the destination brand for their business. The individual SME has little scope to manipulate or strengthen its brand due to the ownership structure of both tourism SMEs and the destination brand itself. Because the brand belongs to everyone at the destination, and because one SME has little managerial influence over the next one, destination brands often evolve only slowly and with tenuous connections between the brand marketed by the Regional Tourism Organisation abroad and the conditions on the ground. The relevance of this study is supported by the fact that tourism is now considered one of the world’s largest employers, generating some 12% of the worlds GDP (WWTC 2004). The majority of its share is produced by SMEs. This study therefore seeks to develop propositions that enhance the competitiveness of tourism SMEs, and thereby the strength of destination brands, by analysing the destination value chains. The World Tourism Organisation defines tourists as people travelling from their home for more than 24 hours and staying overnight for reasons other than business or income. From the demand-side’s point of view, tourism means ‘life away from home’ and is restricted only by the availability of time and money. This ‘life’ is motivated by either escape or approach motivations (Iso-Ahola, 1982) or a mixture thereof. In other words, tourists seek diversion or relief from the stresses and strains of every-day life, and/or seek new experiences to extend themselves. The experiences holiday -makers seek may also be conceived of as a form of self-restoration for those who are exhausted and find it difficult to cope at home and at work, or as a form of selfcompletion, i.e. expanding interests and capabilities that have been neglected. While motivations differ between these poles, it must be appreciated that their pursuit takes place within an overall pattern of consumption that either emulates or contrasts the tourist’s life at home, as motives and values direct and situations permit (Gnoth 1997). Understanding the consumption of tourism products is therefore best described and analysed within the context of travel life-styles (Lawson, Thyne, Young and Juric 1999). In order to define, develop and analyse the relationships between SME and destination brands, an analysis of the ‘product’ will permit access to the service processes as they create the tourism experience. In turn, these processes reveal the structure of the brand as the communicator to internal and external markets. The tourism destination is the harbinger of the tourism product, indeed, as promised in the brand. SMEs the world over are at the heart of substantiating these brands for their destinations. But the individual tourism SME only benefits from the destination to the extent that it helps other SMEs to be as good as they can. Because tourism SMEs are inseparably interdependent, they require tools and structures to manage cooperation while competing.