The Political Economy of Destination Promotion

African tourism website networks

Jeroen van WijkRSM-Erasmus University

(jwijk@rsm.nl)Conference “Imagination, Media Power and Reputation”,

May 30-31st 2007, The Hague. RSM-Erasmus University and Hotelschool The Hague.

How can the tourism industry support economic development?

Main question

How can imagination, media power and reputation promote tourism destinations in developing countries and support economic development?

The Political Economy of Destination Promotion

Global value chain analysis> Vertical (international) networks

Business systems approach> Horizontal (national) networks

Analysis of tourism industry actorsTwo theoretical approaches

The Political Economy of Destination Promotion

Systemic approach, unit of analysis is:* not a company, a country, or a region, but* a network of companies embedded in internal and external governance systems

Focus:* Who adds value where in the chain?* Who is leading actor in the chain?

Normative questions:* How can chain revenues better be distributed over chain actors?* How can the chain’s negative impact on the natural system (‘earth’) be reduced?

(1) Global value chain (GVC) analysis

The Political Economy of Destination Promotion

Global value chain

Retail

Manufacturer

Trader

Supplier

Consumer

Supplier

Coordination

Brand, reputation & media

“Ingredient branding”

The Political Economy of Destination Promotion

Global value chain

Retail

Manufacturer

Trader

Supplier

Consumer

Supplier

Travel agency

Tour operator

Airline

Hotel

Tourist

Guide

Coordination

Brand, reputation & media

“Ingredient branding”

Destination branding

The Political Economy of Destination Promotion

Features tourism GVC

Travel agency

Tour operator

Airline

Hotel

Tourist

Guide

Consumption and production at same time and location

Chain offers B2C contact opportunity at every node

Tourists may shorten and coordinate the chain the chain themselves

Destinations have opportunities in branding, reputation, and media

Individual service suppliers have those opportunities as well

Destination branding

The Political Economy of Destination Promotion

(2) African segmented business system

Networks of: * African (indigenous) firms * Government authorities and para-statals* African minorities: Asians and Lebanese * African whites* Multinationals

* Division urban/rural business

The Political Economy of Destination Promotion

African business networksSet of social, i.e. not purely market exchange, relationships between companies (representatives)

They* Share information about the transaction history of an agent * Enforce contracts informally* Interlink, they work on longer term or incomplete “contracts”. * Reproduce themselves, high barriers to entry * Often display ethnic or religious concentration, because these ties offer socialization frameworks.* May protect common interests

Segmentation is reinforced by the Digital Divide

The Political Economy of Destination Promotion

The political economy of destination promotionThe African model

Travel agency

Tour operator

Airline

HotelChain

Tourist

Guide

Restaurant

Museum ArtistPark

Local hotel

The Political Economy of Destination Promotion

Which are opportunities for “functional upgrading” in the GVC, both for the destination and for individual suppliers?

Who decides on the destination branding?

Which type of tourism is promoted? Which region?And which supplier networks?

Which are the opportunities for independentmarketing by small tourism firms?

Our research

Database of 468 tourism websites in Uganda, Rwanda, and Mozambique

Analyse network structure of website owners/registrants

The Political Economy of Destination Promotion

Mozambique: No portals with hyperlinks; only 8 abroad (5 South Africa)

Rwanda: 5 portals (4 foreign, 1 unknown)

Uganda 7 portals (2 foreign)

Tourism portals

The Political Economy of Destination Promotion

9%

36%55%

Rw andan

Foreign

Unknow n

43%

27%

7%

6%5% 4%

4% 2% 2%

Robert BrierleyOwns or is registrant for one websiteUganda Homepages Ltd.Owns or is registrant for two websitesOwns or is registrant for three websitesN.A.The New VisionUganda OnlinePowebdesign

Website ownership

Uganda Rwanda

N=53N=245

South Africa, 90

USA, 17

Mozambique, 7

United Kingdom, 6

Others, 6 Unknown, 9

Mozambique

N=135

The Political Economy of Destination Promotion

Geographic location tourism service suppliersHyperlinks from 6 tourism portals in Uganda

Hyperlinks from TravelUganda.co.ug

0

10

20

30

40

50

60

70

80

90

100

Urban Rural N.A.

Num

ber of

Hyp

erlin

ks

Hyperlinks from 5 Ugandan Portals

0

10

20

30

40

50

60

70

80

90

100

Urban Rural

Num

ber

of H

yper

links

The Political Economy of Destination Promotion

Conclusions

1. The Internet offers opportunities for functional upgrading African tourism destinations and individual firms.

2. Online destination promotion in 3 African countries is highly mediated by foreigners. 3. Rural tourism stakeholders (CBT, budget accommodation, local artisans) benefit most from foreign web owners in view of international marketing. Effective strategy to circumvent the digital divide, but limited opportunities and new dependency.

4. In Uganda, the native, urban tourism elites dominate tourism promotion, but their network excludes rural suppliers.

The Political Economy of Destination Promotion