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O . o - n a . . i . - . . o . . o n . . . ‘ . . ‘ - ' ' I o o _ I O . ’ . . _ . . _ - ‘ n . o ' 0 ' . . l u ‘ . v . . .. . . . 1 . . . l . . , . . . . ' . ' c O I ~ . . . . . ‘ . . . - - . . . . . . . . . A ' . ' o _ u . . ‘ . . . . . ‘ I If." [—— LiBRARY 'Hchigan State University PLACE IN RETURN BOX to remove this checkout from your record. T 0 AVOID FINES return on or before date due. MAY BE RECALLED with earlier due date If requested. DATE DUE DATE DUE DATE DUE I . 2/05 cleIRC/Datooqundd-pdfi THEORETICAL FRAMEWORK OF INTEGRATED TOURISM DEVELOPMENT PLAN B PAPER ANTONIO SANCHEZ DECEMBER 10, 1981 II. III. IV. VI. THEORETICAL FRAMEWORK OF INTEGRATED TOURISM DEVELOPMENT TABLE OF CONTENTS INTRODUCTION ------------------------------------------ 1 A) Importance of Tourism --------------------------- 1 B) Impact of Tourism ------------------------------- 3 C) The Need For Tourism Planning ------------------- 5 D) Requirements For Tourism Planning --------------- 7 1) The Planning Organization ----------------- 7 2) The Planning Process ---------------------- 8 3) The Policy Framework ---------------------- 9 E) Purpose of the Study ---------------------------- 10 THEORETICAL FRAMEWORK OF INTEGRATED TOURISM DEVELOPMENT 11 A) Origins of Integrated Development --------------- 11 B) Characteristics of Integrated Developments ------ 12 C) Characteristics of (atalytic Developments ------- 15 AREAS DETERMINING THE SUITABILITY OF INTEGRATED DEVELOPMENTS ------------------------------------------ 18 A) Social Consequences ----------------------------- 19 B) The Attraction Base ----------------------------- 21 C) Tourist Demand ---------------------------------- 21 D) Physical Design --------------------------------- 22 E) Project Evaluation ------------------------------ 26 MARKETING INTEGRATED DEVELOPMENTS --------------------- 29 A) Start Up Marketing ------------------------------ 29 B) Ongoing Marketing ------------------------------- 31 D) Maintaining a Positive Image -------------------- 33 CONCLUSIONS ------------------------------------------- 38 REFERENCES -------------------------------------------- 42 Page -1- THEORETICAL FRAMEWORK OF INTEGRATED TOURISM DEVELOPMENT I . INTRODUCTION A. Importance of Tourism "Tourism has been, and will continue to be one of the fastest growing social and economic phenomena of the twentieth century" (Gunn, 1979, pp. ix). Since the mid 1960's international tourism has become one of the most important items of international trade and exceeds, on many occasions, all other commodities including wheat, machine tools, automobiles and other items. Thus, tourism - the business which provides services and facilities for pleasure travelers - has reached major proportions in the world's economy. In many countries tourism is a major source of foreign ex- change. This is true, for example, in England, Mexico, Austria, Switzerland, Italy, Spain, and some Caribbean islands. For these countries, the number of visitors traveling internationally is expected to increase steadily with the participation of a wider range of socioeconomic groups. Tourism is not limited to well-known countries. Geographi- cally, tourism is a universal industry and business. In fact, areas which one would not ordinarily think of as tourist attractions have proved to be successful tourist destinations. Tourism is looked upon by many countries as a highly desirable and feasible method of economic development. This is mainly because the resources which attract and support tourism are -2- usually abundant in underdeveloped areas. These areas often have rich cultural attractions, scenery resources, historic sites, archaeological ruins, abundant low priced labor, wildlife, and other natural resources. Creation of the necessary infras- structure for develOpment can often be supplied by the governments of the countries involved. Thus, tourism can become a readily feasible method of attracting foreign capital in a short time span. Economically, tourism holds a unique positon. It is not properly an industry. Rather, it takes in a cross section of the entire economy for a region or nation. The impact of tourism re- venues and activities cuts across many skill areas, industries and segments of the population. For many countries, a major value for tourism development lies in the fact that it employs and offers career opportunities for comparatively large numbers of unskilled, entry level workers. Tourism represents economic growth. In calculating the impact of tourism, a multiplier factor is frequently considered. Tourism expenditures are recycled through the economy in the form of investments, wages, taxes, purchases of goods and services, con- sumables, etc. The actual economic impact of tourism varies widely between areas. It depends on the local economy and the extent to which it is otherwise self-sustaining. In general, the higher the dependence upon tourism and imports, the lower the multiplier factor will be. -3- This is because an area which depends heavily on tourism will pro- bably have to import many of the goods and services that the tourists and its native people need. Conversely, areas with highly diversified economies will have multiplier factors because the funds are recycled throughout the economy more than they are in the relatively underdeveloped areas. But even in areas with a relatively low multiplier, the economic impact created by tourism development can be substantial. B. Impact of Tourism For most economists, the evidence of the economic impact of tourism is so overwhelming that it is no wonder that under- developed contries seek it and industrialized nations wish to pro- tect it. For some other professionals, - sociologists, urban planners, environmentalists, etc. - the impact of tourism on host areas is not clearly positive. Many of these specialists sustain that the economic benefits of tourism have their costs. Although accounting systems do not yet allow adequate assessment of the extent of such costs, it seems that there are many. For example, new tourist attractions, facilities and services place new stress on existing infrastructure. Expansions of water supply waste dis- posal, electrical power, and communication networks are usually demanded by tourism develOpment. As these are not usually funded by the developers, the community is saddled with an added burden. There is often the need for expansion of police, fire protection, and medical services, and an increase in maintenance and repair of street systems and other public services. -4- Often cited by areas resisting tourism development are the high risk and seasonality of much of tourism. Even though one or two seasons might be beneficial, the residual effects of under- employed or unemployed peOple for the remaining seasons create an economic drain on the community. Certain types of tourism development demand great quantities of land which compete with existing land uses and other economic development. Tourism land use has been preempting prime industrial or agricultural sites in regions without an adequate land use con- trol. With respect to the social impact of tourism, masses of tourists seeking enjoyment usually disrupt existing cultures of the host area. Tourists can produce congestion and competiton for local services, which are detrimental to the host society. The competition for the purchase of goods and services usually creates inflation, which in turn, brings about the consequent resentment of the community members. The environmentally erosive qualities of tourism develop- ments are now a subject of worldwide concern. The damage being done to coastlines, aquatic ecosystems, islands, mountain regions, unique scenic spots, historic sites, and monuments is practically irreversible. When tourism developments are oriented toward profit maxi— mization, fragile ecosystems and attractive landscapes are usually destroyed. -5- In some instances, tourism development is actually causing air and water pollution. Frequently;resort communities pour all raw sewage directly into nearby waters, creating serious problems of contamination. Certain tourist destinations, especially those visited by national tourists who travel in their own automobiles, suffer from air pollution caused to a large extent by tourist activity. The tourist segment of air travel also contributes its share of in- creasing air pollution from air plane exhaust. C. The Need For Tourism Planning A fact that should be accepted, is that tourism is an excellent economic activity. As we have seen, together with the benefits of tourism development there are negative aspects that can not be ignored. Those mentioned previously are only a small fraction of those that could be identified. Although negative impacts are relatively easy to identify, they are rather difficult to measure. For some professionals, the simplest answer to the negative impact of tourism is to prevent tourism growth. If the number of tourists per week is kept constant or even reduced, the negative impact will be easier to control. Unfortunately, with this line of thinking the economic benefits are usually reduced,since very few tourist areas can sustain a healthy economy with a constant number of visitors. Actually, what most of the tourist areas seek, is an optimum state of tourist development in which the economic benefits are -6- maximized and the negative impacts are kept to a minimum. To achieve such an optimum state, more and better tourism planning is needed. Tourism planning has been recognized as the most re- liable way to achieve an orderly and controllable state of tourism development. With adequate planning, many segments of tourism develOpment can perform their individual roles in better collaboration, and with greater sensitivity to the negative economic, social, and environ- mental consequences. Lack of tourism planning usually does not inhibit tourism development. Tourism will take place anyway, as long as there are enough economic pressures. The results of unplanned develOpment are generally undesirable: over-development, sprawl, fragmentation, urban decay, social instability, overload of utilities, uncoordinated services and facilities, negative public image, dissatisfaction of tourists, etc. During the last decade, the need for tourism planning has been particularly stressed by financial institutions, which forced by tight capital markets, require comprehensive planning studies to approve loans and investments. Local and regional units of government are increasingly aware of the need for tourism planning, since they realize that tourism is becoming more competitive every day. Planning of tourism at the national level, although not very practical for the political and bureaucratic processes it involves, is each day more necessary “D -7- to project a well defined national image, to establish an overall develOpment policy framework, and to increase cohesiveness and coordination among regions. In short, planning is essential for the success of tourism development. Planning is required not only to build success, but also to maintain success. When tourists come to resort areas, they come seeking pleasant experiences. Hopefully, success in tourism will result in a pleasant experience for the host areas as well. This is the real planning and management Challenge. D. Requirements For Tourism Planning Because tourism planning is so critical in the successful develOpment of a tourist area or resort, the nature of l) the plan- ning organization, 2) the planning process, and 3) the policy frame- wor, can influence to a large extent, the success of the develOpment. l) The Planning Organization If tourism planning is to happen in a specific area, some entity must stimulate and enunciate the original idea. The basic inspiration must be shared by the party or entity which holds controlling interest and responsibility for the resources to be utilized in the tourism industry. Although the other parties - political, financial, and technological - are generally involved, the active participation by the controllers of the essential re- sources is an irreducible requirement. Depending upon individual situations, actual property equity, and/or forms of government, the planning organization can settle -8- upon any or a combination of entities; including: *An individual or a family owning enough land to control the entire planning process. *A company or consortium of private business organiza- tions having land holdings which make possible the ultimate control of resources on which plans can be based. *Resource utilization decisions may reside with a governmental agency. *Planning responsibilities may be assigned to a planning commission which is limited to recommenda- tions requiring action by a legislative body. 5 " Once the most appropriate planning organization for a given area has the capability to decide and act, the next vital ingredient for tourism planning is a process which guides and coordinates the many interrelated steps essential to tourism planning and develop- ment. 2) The Planning Process Depending upon the detail level to which planning is carried out, a tourism develOpment project can have anywhere from dozens to hundreds of activities organized into logical, inter- dependent sequence. These activities, however, can be grouped into ten key steps or phases. The process of tourism planning and development may include: -9- a) Establish a basic understanding of the area b) Preliminary position statement C) Commitment for tourism study d) Market and resources analysis e) Conceptual planning f) Plan approval (Kaiser & Helberg, 1978, p. 31) g) Master planning h) Final commitment i) Staged implementation program j) Evaluation and direction The individual phases stated above may or may not be applic- able depending on the needs of each particular project. 3) The Policy Framework For some of the phases stated before, the formulation of policies is an integral part. However, the policy framework can be considered as an independent factor affecting the success of tourism development. For example, we could find that different planning organizations, with different planning processes, still follow the same type of policy framework. By itself, the policy framework has the power to determine to a large extent the final characteristics of the touristic develop- ments. Therefore, policies to be employed in the process of tourism planning should be carefully formulated. Although flexible, they should provide the necessary directions to achieve the optimum state of tourism development that will make the best use of the natural and human resources available in the area. -10- Policies can vary widely and independently. Some may be in conflict with others. Most of them present advantages and dis- advantages that are difficult to evaluate. For tourism planning, there are usually several ways in which goals can be achieved. A tourist area may be developed to attract essentially international visitors, or national travelers. It may favor foreign investment or local participation. It may cater to exclusive, high priced tourism; or it may be devoted to massive tourism and package tours. Establishing the appropriate policies that would promote the most convenient type of development is not an easy task. Although policy makers often base their selections in analytic studies, sometimes, policies are determined by political factors, pressures from special interest groups, and subjective decisions. E. Purpose of This Study It is in the policy area, and closely related to the con— ceptual planning phase of the planning process, that the study pre- sented in the following pages finds it application. The main objective of this study is to help in the evaluation of the type of development that is most convenient for a given area. The study will consider the characteristics, requirements, compon- ents and consequences of an "Integrated Typecfi’Tourism Development," with frequent comparisons to the "Catalitic Type." This study can be useful in the formulation of policies pro- moting integrated types of developments, and it should provide the frame of reference for further considerations in physical planning and management of Operations. I“ -11- II. THEORETICAL FRAMEWORK OF INTEGRATED TOURISM DEVELOPMENT Few touristic areas present a well defined type of tourism development. In most of the cases, tourism takes place involving a mixture of identifiable patterns. This paper will not be limited to a single type of tourism development. In order to enlight the concept of Integrated Tourism Development, a contrasting type of development will also be considered. The basis for discussing these two polarities lies on the division of responsibility in the development process: - "Integrated Development implies development by a single promoter or developer to the exclusion of all other participation." (Pearce 1978, p. 43) - "Catalytic Development, on the contrary, occurs when the initial activities of the major developer generate complementary developments by other companies or individuals" (Pearce, 1978, p. 43). This basic difference in the division of responsibility in- fluences not only the nature of the development process but also the final form of the resulting resort, its location, and to a certain degree, the type of clientele served. A. Origins of Integrated Developments One of the first and Classic examples of an Integrated Tourism Development is La Plagne. The french ski resort was created in 1963 by the architect Michael Bezancon and its construction was directed by Robert Legoux. (Georges Cumin, 1970, p. 51). m " -12- La Plagne was often compared to a cruiser in the snow. The modern and compact complex provided condominums, commercial center, hotels, restaurants, entertainment, ski instruction, and rental of equipment. Since La Plagne was constructed, the concept of Integrated Tourism Development has been extended to beach resorts and marinas, becoming a common type of tourism development throughout France. George Cumin wrote: Integrated Tourism Development is a typical french specialty, as patios are from Spain, souks from the Arab Countries, and skyscrapers from Manhattan. However, Integrated DevelOpments are not limited to France anymore. Nowadays, they can be found in many countries with a strong touristic economy. B. Characteristics of Integrated Development According to Douglas G. Pearce, the process of Integrated Development is characterized by the following factors: 1. A Single Promoter The entire resort is developed by a single promoter or company. The company should have at its disposal adequate financial and technical resources. Consequently, such developments are generally limited to large metropolital financial concerns. Local participation is largely excluded from b the development process, although some locals generally work in the construction and subsequent staffing of the resort, and local authorities may be induced to undertake public work programs to complete the necessary infrastructure. -13- 2. Balanced Development This unity of management more readily permits, though does not necessarily ensure effective over- all planning and balanced development, both technically and financial- ly. With but a single source of direction, the ratio of the capacity of services to the capacity of accomodations can more readily be maintained. For example, the number of restaurants in a resort will be in prOportion to the number of beds available. Technical problems inherent to construction are more easily overcome. For example, given the size of the development it makes sense to operate potable water plants, sewer treatment plants, or even generate electrical power. This is particularly advantageous for the development of isolated sites. A common budget allows those aspects of the project which may be initially unprofitable to be compensated by more lucrative Operations. For example, the installation of ski-lifts may be compensated by the hotel operations or the sale of real estate. 3. Rapid Development This technical and financial coordination facilitates very rapid, yet balanced development, which in turn permits a short term return on the capital invested. 4. A Functional Form Coordination, coherent planning, and physical integration of the resort's facilities may result in a very functional form whereby the tourist, his habitat, and his recreational facilities are brought together in a very localized and close-knit resort. m -14- Thus, condominums and hotels cluster at the very foot of the ski slopes; private beaches, individual swimming pools, shopping facilities, and entertainment are found at a very close distance within the same resort complex; marinas permit the yachtsman to step out of his back door and onto his yacht, etc. 5. Isolation Complete freedom is necessary to develop such resorts. Thus, they are commonly located away from existing settlement» on comparatively isolated stretches of the coastline; in the outskirts of central cities; next to archaeological ruins; or above the line of permanent settlement in the Alps. This compliments the need for integration with the natural elements but further removes the resort from the possibility of insertion in the local milieu. 6. High Status The first rate facilities which such a functional type of resort offers attracts a high class of tourist. In this way, increased costs which are normally associated with the develOpment of isolated sites are offset by the higher rates and the overall financial structure of the operation. In some cases and areas, isolation by itself may even enhance the resort's status. 7. National Impact Usually, the construction of an integrated development has national consequences. Although the regional area is the one that benefits the most, this kind of development is very adequate to improve national prestige. This is enhanced as consequence of media campaigns that can only be -15- afforded by such large developments. Besides the large economic support, these media campaigns have the advantage of being directed by a single promoter. They are persistant and consistent in market positioning and image improvement. Other types of tourist developments may have enough economic resources floundertake similar campaigns, but problems in the coordination of different interests make these campaign less efficient. National prestige is beneficial not only to the tourist economy of the country, but to its financial, commercial, and industrial operations. Sometimes, the develOpment's impact may be directed to affect political relations with other countries, or international trade. C. Characteristics of Catalytic Development As a contrast to the characteristics described above, we may consider an opposite type of tourism development which might be more appropriate to achieve certain goals. Catalytic Development is the one in which "a single promoter may dominate the development process without, however, monopolizing it. On the contrary, his activities serve as a "catalyst" by stimulating complementary developments." (Pearce, 1978, p. 46). Catalytic Development is Characterized by the following steps: 1. Initial impetus comes from a single large promoter, often a major outside company, who provides the basic facilities or attractions which will create the conditions for "take off." The primary attractions may be ski-lifts, thermal baths, boat -16- harbour, museums, etc. If the attractions need not to be created (existing archaeological ruins, historical sites, water falls, etc.), then the initial impetusmay be the establishment of major accomodation units like large hotels, condominums, convention centers, etc. If attractions and accomodations are present, pro- motion and publicity could also be considered as catalysts. The establishment of travel agencies and the promotion of an advertis- ing campaign can greatly increase the demand in tourism. 2. Complementary Development. The success of these activities engenders a spirit of confidence, creates more demand, and encourages the development of complementary facilities: secondary recreational facilities like night clubs, bars, cinemas, bus excursions, sport facilities, theaters, etc. Alternative accomodations are also likely to increase: chalets, motels, small hotesl, pensions, camping areas, trailer parks, etc. These pro- jects require mOdest investments, thus permitting the active participation of smaller local companies and individuals in the development and management of the resort area. 3. Balanced Growth. The expansion of the resort. now depends essentially on the operation of a free market system with both, the principal promoter and the secondary developers, pro- viding facilities to meet the increasing demand. However, if these secondary developers do not respond sufficiently then the principal promoter will have to step up his own activities in order to safe- guard the profitability of his existing operations. Conversely, -17- it is essential to guard against excessive speculation and over- development. In some cases. the principal promoter may impose a predetermined program on the secondary developers. In others, planning regulations or the judicious intervention of the local authorities may effectively, if the local jurisdiction is effective, control growth. The resulting resort differs significantly from the integrated one. Catalytic developments are usually grafted onto existing settlements. However, the major developments often locate some distance away from the center around which are concentrated the activities of the locals on their existing property. The presence of existing dwellers, together with the multi- plicity of developers, and the less intensive nature of their pro- jects, gives rise to a much more diverse and less concentrated resort than that which results from integrated development. The range of the accomodation types offered also broadens the base of the resort which may attract several different classes of visitors. ‘K‘. O -13- III. AREAS DETERMINING THE SUITABILITY OF INTEGRATED DEVELOPMENTS Chapter II has presented the theoretical characteristics of integrated tourism developments. The analysis of these charac- teristics provide decision-makers with the preliminary information necessary to evaluate integrated developments against other possible alternatives of develOpment. However, this analysis is not enough to determine if integrated developments should be promoted on a given region or particular site. This is because tourist develop— ment of certain characteristics may only be appropriate for some host societies, some forms of government, and under given circum- stances. Since most of these factors change from country to country, and in some cases, from region to region, further investigation is needed in order to determine the actual suitability of integrated developments in specific situations. Private organizations and government agencies reSponsible for tourism development should com- pliment the characteristics of integrated developments with the characteristics of specific region and site. Next, they should determine conflicts and affinities to come up with rationals that will support the selection of a particular alternative. In order to clarify this decision making process five areas of research are recommended: A) Social consequences, B) The attrac- tion base, C) Tourist demand, D) Physical design and E) Project evaluation. Ideally, each of these research areas would have to yield positive results that would contribute to the approval of the whole project. Each of these areas is discussed separately: «’3 -19- A. Social Consequences The actual construction of integrated developments can have peculiar types of social consequences. For example, a notice- able change in the population structure is the enormous increase in construction workers. In some developing countries, the construction industry depends largely on transient workers who move from one con- struction project to another in order to supplement meager agricultural incomes. At the peak of building activity, such rapid developments could require around 6000 unskilled laborers and perhaps 1000 skilled workers and professionals. The influx of workers has many repercussions. Often workers at the low end of the wage scale live in temporary camps set up close to the construction site. Living conditions within these camps are extremely poor, and housing, food, and water supply are inadequate. The different customs these workers introduce bring about a deterioration in the traditional values and commonly respected customs of the local community. Boredom in the worker's leisure time often results in high consumption of alcohol and fights. Relation between sexes are also affected inasmuch as there are many more men than young unmarried women. In general, very few workers send for their family or marry local people with a View toward settling permanently in the area. Although these conditions have negligible effects on the local population once the construction is completed, they should -20- be taken into consideration when planning these kinds of projects. Construction of catalytic and other types of tourism development involve social consequences that are less pronunciated. Their construction takes place over relatively larger periods of time, involving several small projects. Host areas located in developing countries with rich cultural traditions, experience negative social consequences that are attributable to tourism alone. Conflicts arise when masses of tourists take over beaches and streets and start active demonstra— tions of different life-styles. Integrated develOpments are less disruptive to the indigenous culture than any other type of tourism developments. Since they practically offer all kinds of services, most of the tourist's activities take place within the same development. Intercultural contact is limited to nearby tours, typical shows, and the normal social interaction with local employees of the development. Although minimum intercultural interaction is suitable for some host societies, there are other cases in which intercultural contacts might be beneficial. The presence of strangers from foreign countries may weaken conservative traditions and help break down provincial patterns of thought. At least, inter- cultural interaction could provide the indigenous population with new Opportunities for learning. The amount of intercultural exposure that should be given to the tourist pOpulation is very difficult to determine. It "‘3 -21- depends on the host society. It depends on the planning goals, and it depends on the personal values of the decision-makers. B. The Attraction Base Tourism can be considered as the key to regional develop- ment programs and the answer to an area's economic needs. Failure to meet this promise may result from an over optimistic evaluation of the region's tourist potential. The same can be said of in- dividual units of tourism development. Integrated developments, regardles of how perfect they are designed,vfill not succeed if they do not have a strong attraction base. A careful evaluation of the attractions will indicate by itself, if it is logical to promote an integrated development or not. While almost anything at one time or another may become an attraction, only those with easy comprehensibility, basis in the environment, magnetism, uniqueness, and capacity to satisfy, will be adequate to support large develOpments. Attractions rating less than the optimum score will have to be exploited through catalytic or other types of tourism development. C. Tourist Demand Another important basis on which planning of integrated developments is made, is the measurement of demand. This is a very difficult area, because demand (present or future), is affected by many variables. Present demand is often used in forecasting models to pro— ject future demand. However, data used as present demand is often n hr -22- not representative of the real present demand. Usually, unintened bottle necks in transportation services, wrong profile choices, and poor promotion strategies distort the data gathered by the government agencies. On the other hand, the forecasted future demand may be con- sidered as an endogenous variable depending on current and future supply future marketing strategies, and future image and reputation. Accuracy in forecasting demand of an integrated development is crucial. To reduce avoidable error, the forecaster will have to pay special attention to the reliability of data, the adequacy of data, the sources of data, and the adequacy of methodology. Experience on similar projects and good strength of reasoning are also required for best results. Of course, the forecasted tourist demand is critical in the feasibility of integrated developments since such large projects require enormous amounts of tourists to succeed. D. Physical Design Although the basic design principles applied to Integrated Tourism Developments are very similar to design standards applied to hotels, restaurants, and similar individual units found in Catalytic Developments, there are other major design considerations that are different and that will determine if an integrated develop- ment is suitable for a particular site or not. Amont the most important is that of the size or scale. One way of determining the size of any touristic development is by -23- limiting the lodging capacity. The number of beds offered py the accomodation facilities of an Integrated Tourism Development should not exceed 4 or 5000. Beyond 5000 beds the atmosphere of the develop- ment changes from relaxing enjoyment to urban agitation. Integrated Developments should never cover 1000 linear meters. Its maximum area should be determined py pleasant walking distances that take into consideration the terrain's topography and the physical capacity of middle aged tourists. It is recommended that the maximum difference in altitudes of the terrain should be under 50 meters. Obviously, the physical configuration of the terrain is a major determinant in the feasibility of Integrated Developments. In some cases, geographical barriers like hills, lakes, rivers, etc. may add special attraction to the develOpments. In other cases, they may be the cause that makes integration impossible. The final size of the development should be determined taking into consideration the site, the topography, the tourist market, transportaiton networks, and financial resources. Once the size is determined, usually in number of beds, the rest of the development is easily balanced. For so many beds, so many restaurants, bars, shops, tour agencies, etc. One of the most critical aspects of the design of Integrated Developments is the integration itself. The spatial distribution of buildings on the site and the linkages between them determine to a large extent how functional will the development be as a O -24- whole. A functional design is crucial to the success of the development because it is basic to provide satisfaction to the tourists. Functional designs usually give complete priority to pedestrian traffic. Pedestrian flow is arranged in such a way that tourists are constantly exposed to shops, landscaped, gardens, natural scenery, and other points of interest. Restaurants, cafe— terias, restrooms, and resting areas strategically located through— out the development help to make walking a more pleasant experience. One of the most important parts of the pedestrian pattern is the linkage between the development and the main attraction. This line of access is usually left withits natural characteristics; hiking trails to reach a water fall, an old path that leads to an archaeological site, stripes of access to the beach, etc. Regardless of the form of the pedestrian network, there is always one basic requirement: pedestrians should not have conflicts with other modes of transportation. Cars should be forgotten out- side of the development. Pedestrians, bycicles, boats, horses, etc., each should be considered as separate components of the final transportation design. Taking advantage of the economies of scale, design of utility systems should favor centralization. Water, sewer, gas- lines, may each be handled by single systems, and partially share the same distribution pattern. Air conditioning and heating may also be central, and electricity lines are generally fed by a single electrical station. -25- A functional design of the development should also provide for efficiency in operations. Administrative services should be centralized. Other activities like maintenance, storage, laundry, and cooking should be standardized in operations and equipment, although their necessary facilities should be located in the points where they best provide services. Design of Integrated Developments will also have to be tailored to the nature of the area itself. Factors bearing upon design can include local traditions or customs in architecture. Examples of conformance with local design traditions include thatched-roof facilities in Fiji, Tudor architecture in Great Britain, or pagoda-style buildings in Japan. However, local architectural styles cannot always be applied to Integrated Touristic Developments. Obviously, there are some kind of build- ings that will never be compatible with local architectural characteristics. Good taste and judgment of the architect res- ponsible for the design should decide if comformance with local traditions is possible, and to which extent. Integrated DevelOpments, because of their inherent character- istics, present to architects the Opportunity to create master pieces. Equally, if their design is of low quality, they may create monolithic monsters. Functional design should also be tailored to the anticipated lenght of stay of the tourists. Rooms will have to be more spacious and more amenities will have to be provided in develop- ments where the tourists stay longer. -26- Accomodations should be designed in accordance with the prices to be charged. Even though there may be several classes of accomodations within a single Integrated Development, the difference in their rates should be minimum. It is not convenient to mix clienteles with different budgets since this might damage the image of the development. Another shaping factor determining accomodation standards and design should be competition. Facilities within the Integrated Development should be at least as good as those in other destina- tions striving to sell to the same markets. At the same time, design of the individual units within the development should allow for certain competition. Tourists must have a reason for visiting one restaurant today, and another tomorrow. 'With the proper monitoring and planning, internal com- petition is undoubtedly beneficial. Beyond a given level, however, it can become disastrous to the whole development. E. Project Evaluation A feasibility analysis, like in many other projects, is the critical study that determines if an integrated tourism develop- ment should go under construction or not. A decision of such kind is crucial for the regional economy and the country's tourist in- dustry. Once an integrated development is built, it stays on its place forever. There is almost no chance for adaptation to other uses. It is a development that has been designed to serve only for a specific purpose. _27- The feasibility analysis, composed basically by the market study and the financial structure, will lead to an appropriate decision as long as these two components are both sound and re- liable. It will also predict the rate of return of the project, and the risk involved. The projected rate of return of most integrated developments is comparatively very high, but so is the risk. Such results are characteristic of these type of develop- ment projects. They require entensive capital investment, they have very high fixed operating costs, and their market behavior is difficult to predict. Feasibility studies yield prositive results in approximately 25% of the cases, the rest of them are either cancelled or adapted to other types of develOpment. The financial structure of any integrated development is very complicated. The same happens with the legal structure of the organization or company responsible for the development. Land acquisition is also a long and bureaucratic process because it usually involves dealing with many owners, different land prices, and legal restrictions. 'A common denominator in all these inconveniences is the large scale of the project. In general, the bigger the development, the more complicated and tedious the whole process becomes. There are two common ways of financing integrated developments: borrowing money from a financial company, or having direct foreign investment. In the first case, the investing firm is a national -23- company. This allows local government agencies to have greater control of the development, and best of all, profits stay in the country. Of course, the capital has to be paid back eventually, and the national company bears the risk of bankruptcy. In the second case, the risk is borne by foreign investors, there are no payments back but the profits leave the country and the control of the develOpment is very difficult. All these factors should be considered to select the most adequate financial source. -29- VI. MARKETING INTEGRATED DEVELOPMENTS A marketing program for an Integrated DevelOpment falls locically and necessarily, into two separate, distinct phases: start up, and ongoing operation. Programs including these two phases are usually prepared by the administration of the Integrated Developments, and by the regional offices responsible for tourism planning. Marketing programs prepared by Integrated Developments highlight the best characteristics of their services and facilities. Programs from the regional agency focus on projecting the best image of the touristic area as a whole. Although different in their SCOpe, both levels of marketing programs should be consistent. One compliments the other because by themselves Integrated Developments cannot achieve success if they are not supported with regional (or national) promotion. To help overall coordination, the necessary guidelines for the marketing programs should be stated in the tourism develop- ment plan for the region. Guidelines should reflect the initial tourismrmnmet study which led to programs of tourism planning and development. This should indicate the potential strengths of the destination and the markets into which they should be sold. A. Start Up Marketing If an Integrated Development is new in the tourism market or has been substantially expanded, start up planning is particularly critical. This is because a disproportionately large percentage of problems and failures are experienced in serving the first guests into the new development. 6'7 -30.. Start up operations create a potential impact on the total success or failure of the development, since word-of-mouth is the strongest and most convincing sales support a tourist destination or resort can have. Thus, if things are fouled up at the beginning, there is danger of built-in, long range negative impact. Conversely, a good experience at the beginning greatly enhances prospects of success. For these reasons, extreme care should be exercised in the setting of an official Opening date of an Integrated DevelOpment. "A good practice is to take a logical opening date, the day all parties are sure everything can be brought together and be ready for Operation, then extend the date for about a month or six weeks, using this later date as the official opening" (Kaiser & Helber, 1978, p. 227). If the facilities are ready for business prior to a con- servatevely set opening date, this time can usually be sold simply by plugging it into the promotional and marketing mechanisms which should have been established by then. As an alternative, some developments sell limited numbers of discounted packages to bring guests into the new facilities to give the personnel a chance to "shake down" the operations before guests identified as primary marketing targets begin to arrive. A special consideration associated with start up marketing programs is that the money expended in them should and can be regarded as part of the capital costs of going into business. I": -31- Careful consideration should be given to the prospects for capitaliz— ing the expenses as recoverable through Operating profits at a later date. Generally, the amount of money allocated to start up programs has an impact upon the budgets for ongoing promotion. In effect, the budget for ongoing promotion maintains the image and position established by the start up program. Thus, the ongoing program budget should relate to and provide continuity for the start up allocation. B. Ongoing Marketing Tourism marketing programs sell pleasant experiences to specific groups or types of people. Tourists do not buy hotels, beaches, parks, or other attractions. Since it is known what kind of experinces an Integrated Development has to offer, ongoing marketing focuses on determining 1) who are the potential customers of the development, 2) what do they like and want, and 3) how can potential tourists be informed about a given destination area that has what they want. By using work already done in the market analysis of the develOpment program, and supplementing it with the necessary additional information, it should be easy to prepare a marketing program to support ongoing operations. While creating ongoing marketing programs, separate attention should be paid to media campaigns, and selling programs. Both should be related, since the media programs condition the market -32- for the actual selling effort. It is pointless to spend time and money on selling activities when prospective customers may have never heard of an area. Thus, the heaviest use of media should usually be at the front end of the marketing program. This media campaign should be tailored to reach the people who will be approached by the selling organization. Ongoing programs for most Integrated Developments face natural seasonal fluctuations on the demand curve. To stabilize the demand curve a counter cyclical promotional campaign is usually recommended. When demand is the lowest, media campaigns should be in their peak; when demand is high, promotional efforts should be minimum. This strategy requires careful planning and a strong financial positon to ensure large promotional budgets when profits from Operations are minimum, and vice versa. In the tourism industry the selling organization spends most of its time dealing with travel professionals. Members of the sales staff are generally located in or near the major areas identified as prime markets. Sales territories are set up in much the same manner as in the planning of sales of a manufactured product. Usually, an information and sales office is established in each sales territory. In addition to selling directly to some customers, these representative offices serve as linkages between the Intergrated Development and collateral tourism organizations. Among other duties, sales offices participate in promotional I ‘ -33- meetings and call upon travel wholesalers, packagers, airline representatives, travel agents, migrationcflflices, and financial institutions. The management of an Integrated Development, in accordance with the guidelines establihsed by the regional office responsible for tourism planning, should coordinate on an overall basis the most important activities of the sales offices and supervise the proper implementation of media and sales programs. C. Maintaining a Positive Image "Almost anybody who has followed tourism can describe a resort which started as a playground for the wealthy, became increasingly popular, experiened a cycle of feverish building and capital investment, hit a heyday, then began to decline," (Kaiser and Helber, 1978, p. 5). This has been true for some touristic areas managed by either private or public sectors. Governmental agencies have been just as short sighted and as lay in their planning as profit motivated capitalists. When this has happened, touristic areas or resorts have tended to pattern themselves into rising and falling cycles. A psychological theory has been advanced to explain the changes in popularity of tourism destination areas. Its developer, _ Stanley C. Plog, places the behavioral characteristics of travelers in a continuum of psychographic groups. Two major behavior polarities are identified: -34- *"Allocentric persons are self-confident, usually success- ful, high earners, and frequent travelers. Allocentrics tend to prefer uncrowded destinations where they can satisfy their desire for discovery through novel experiences. They Show a high interest in meeting people and exploring strange cultures." (Kaiser and Helber, 1978, p. 6) *"ngchocentric persons are unsure of themselves, employed in mundane positions, low earners and infrequent travelers who~ seek security of tours to familiar destinations." (Kaiser and Helber, 1978, p. 6) Between these two polarities are gradations: near-allocentric, mid-centric, and near-psychocentric. The great majority of people are judged by Mr. Plog to be mid-centric. Mid-centric tourists like budget tours, heavily used destination points, familiar food, and chain type hotels. According to Mr. Plog's theory, tourist destinations tend to rise and fall in cycles which match shifting psychographic appeal. For example, a tourist area may start attracting allo- centric tourists, then it grows and starts attracting mid-centrics, and finally overdevelOps attracing psychocentric tourists which eventually cause decline. When a touristic area of resort is visited mainly by mid— centric persons, it means that the destination has reached its maximum potential because, at this point, the resort is attracting the broadest audience possible. -35- Before the mid—centric peak, (from allocentric to mid- centric) the introduction of each new type of visitor meant a larger population base from which to draw travelers. When the appeal of the resort,passes the magic mid—point in the population curve to travelers, decline begins to occur. From this point one, as a destination moves toward the psychocentric end of the continuum in terms of its appeal in popularity, it begins to draw on smaller numbers of travelers. Such travelers - mainly psychocentrics - do not travel as often as allocentrics and they prefer destinations which they can reach with their automobile. Their total stay at the destination is less than for allocentrics, and they spend less money on a per capita daily basis. With this picture in mind we can understand why it is so important to maintain a positive image of an Integrated Tourism Development. By positive is meant an image which attracts from allocentrics to mid-centrics. Maintaining a positive image is easier for Integrated Develop— ments than for other types of tourist development. Intregrated Developments are designed from the beginning with a specific target market in mind. Facilities are created especially to satisfy rich tourists with a high status atmosphere located in isolated and exotic places. In short, Integrated Developments are planned from A to Z to attract the allocentric to mid-centric range of travelers. However, not all projects work as they are planned. If the image changes and starts attracting psychocentrics, Integrated (“Ii r I -36- Developments are easily damaged by their inherent characteristics. Other kinds of developments are more likely to adapt to new types of operations and clientele although the consequences are always negative. Maintaining a positive image is a complicated process because it involves many strategies and activities that vary with each particular situation. However, if maintaining an image is a difficult task for tourism planners, reversing a negative image is almost impossible. For this reason, efforts to maintain a positive image or market position of an Integrated Tourism development, should not be limited to the preliminary planning stage. To be effective, they should be carried on to everyday operations. The very nature of the business Of tourism or of tourists coming to any destination can change dynamically over relatively short periods of time. As the mix and makeup of tourism change, the decison makers of a destination or resort must plan for and implement adjusting changes. The consequence of not doing so is a high probability of decline. Some of the factors affecting the actual image of an Inte- grated Development have been mentioned previously. The most important of such factors are: tourism planning programs, market- ing programs, advertising programs, management and operations of the resort and the entire destination area, political and economical stability of the tourist area, political and economical stability of -37- the tourist market area, stability of transportation services, and collaboration of the host community. Most of these factors are interrelated, and adjusting changes taken in some of them usually require compensating changes in others. -38- V. CONCLUSION As stated before, the main objective of this paper is to develop a frame of reference that can be useful in the determina— tion of the type of tourism development most convenient for a given area. The study concentrates on the analysis of Integrated Tourism Development. To clarify the possibilities of Integrated Developments, chapter II compares this type of development with the catalytic type. The following table summarizes the findings. Contrasts between both types of development are graded with four possibilities: Y:yes, N:no, GY:generally yes, and GN:generally no. CHARACTERISTICS OF THE DEVELOPMENT INTEGRATED CATALYTIC A single promoter ----------------- Yes No Balanced development -------------- Y GY Rapid development ----------------- Y N Functional form ------------------- Y N Isolation ------------------------- Y N High status ----------------------- Y GN National impact ------------------- Y N Participation of local companies-- N Y Wide range of accomodations ------- N Y Grafted onto existing settlements- N Y Possible with minimum demand ------ N GY Possible with minimum attractions- N GY -39- As we have seen, integrated and catalytic types of develop- ment have different characteristics, advantages, and disadvan- tages. Which of the two processes is to be followed under given circumstances requires careful analysis of the development's objective, and careful analysis of the area and site's character— istics. If the primary aim is not simply tourist development but rather regional development the catalytic process offers the best possibilities for local control and participation as well as greater circulation of the benefits through the regional economy. For successful catalytic develOpment, however, local communities must not only have the opportunity to participate but also the resources to do so. Consequently, tourism development plans should include policy programs to promote local participation through low interest loans, training programs, fiscal incentives, etc. On the other hand if the objective is to stimulate the tourist traffic on a national or international scale, then inte- grated developments constructed in isolated areas by metropolitan conglomerates may be desirable. Such develOpments will not only generate a flow of first class tourists and capital as a prelude to a more braodly-based tourist economy, but in their isolation and integration they will by the least socially disruptive alternative. -40- Integrated developments may be planned to grade down into the catalytic process as the role of the principal promoter be- comes less pronounced. Also, with careful planning, integrated resorts may act as catalysts of a region to produce a widespread tourism activity. After a preliminary analysis of the basic characteristics of these two types of tourism development and the deverloper's objective, private organizations or government agencies in charge of tourism development should be able to select a tentative type of development. If they find that integrated developments offer the best possibilities, they will have to extend their research to find conclusive answers. Chapter III focuses on the research areas that determine the suitability of integrated developments under given Circumstances. Five areas of research are recommended: A) Social consequences, B) The attraction base, C) Tourist demand, D) Physical design, and E) Project evaluation. If the first four areas yield positive results, it will make sense to compile all informa- tion and prepare a final project.. The last research area, Project evaluation, will analyze all the collected information and decide if the integrated development goes under construction or not. We should realize that once an integrated development is built, it stays in its place forever. There is almost no chance for adaptation to other uses. It is a development that has been designed to serve only a specific purpose. Therefore, it makes sense to take enough time and thoroughly analyze all the factors -41_ that might influence a decision of such magnitude. Planners should also remember that success in tourism development is achieved not only by a sound decision on the type of develop- ment to be followed, but also by projecting and maintaining a positive image. -42- REFERENCES 1. George CUMIN, 2970, "Les Stations Integrees," Urbanisme, 1970 (116), p. 51. Clare A. GUNN, 1979, Tourism Planning, (New York, New York: Crane, Russak & Company, Inc.), p. ix. Charles KAISER, Jr. and Larry E. Helberg, 1978, Tourism Planning and Development, (Boston, Massachusetts: C B I Publishing Company, Inc.) pp. 5, 6, 31, 227. Douglas G. PEARCE, "Tourist Development: Two Processes," Travel Research Journal, (No. 2) 1978, pp. 43, 46. IIIIIIIIIIIHI|||lIllll|I|I|I|IIIIIIIIHIHIIIIIIIlllIlllllllIII 31293 02645 9994