Tourism Management

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Chapter 3
Tourism Management
Lidia Andrades Caldito, Fre´de´ric Dimanche,
Olga Vapnyarskaya and Tatiana Kharitonova
LEARNING OUTCOMES
As a result of this chapter, the students will
• Understand the tourism system, its components and
its stakeholders
• Realise the various costs and benefits of tourism
• Appreciate how sustainability should be addressed by
tourism management
• Recognise distribution channels as the link between supply
and demand
• Identify the factors that determine tourism destination
competitiveness
CHAPTER OVERVIEW
This chapter discusses some key concepts for destination and tourism man-
agers. It first describes the tourism system and its components or stake-
holders. The chapter then defines and discusses tourism destination
competitiveness. Being competitive on the marketplace should be the main
concern for tourism managers. A discussion of tourism destination plan-
ning, management and marketing follows. Finally the chapter ends with a
presentation of tourism management in Russia.
58 Lidia Andrades Caldito et al.
Chapter Outline
3.1. Introduction to Destination Management

3.1.1. The Relevance of the Tourism Sector and Objectives
of the Chapter
3.1.2. Key Definitions
3.2. The Tourism System
3.2.1. The Tourism Product and the Tourism Sector
3.2.2. The Tourism System Components
3.2.2.1. The tourist
3.2.2.2. DMOs
3.2.2.3. Where supply and demand
meet — communication and distribution
3.2.2.4. Transportation
3.2.2.5. Hospitality and related services
3.2.2.6. Attractions, entertainment, etc.
3.2.2.7. Events and mega events
3.3. Tourism Destination Competitiveness
3.3.1. The Starting Point: What Is Competitiveness
for a Tourism Destination?
3.3.2. Brief Overview of the Academic Literature on TDC
3.3.3. Managing TDC: Tourism Destinations as a
Service Delivery System
3.4. Destination Planning, Development and Management
3.4.1. Tourism Destinations as a Value System
3.4.2. Destination Planning and Policy
3.4.3. Sustainable Destination Management and
Intra-Destination Cooperation
3.4.3.1. Sustainability
3.4.3.2. Cooperation
3.4.4. Marketing Management
3.4.4.1. The Marketing plan
3.5. Russia as a Tourism Destination
3.5.1. Tourism in Russia — How Is It Organised?
3.5.2. Tourism Management in Russia: Challenges
and Opportunities
3.5.2.1. Product design and resource management
3.6. Conclusions
Discussion Questions
References and Bibliography
Tourism Management 59
3.1. Introduction to Destination Management
3.1.1. The Relevance of the Tourism Sector and Objectives of the Chapter
According to the World Tourism Organization [UNWTO], the tourism

sector covers travel services related to recreational, leisure or business
purposes. During the past decades, the tourism sector has experienced con-
tinuous growth and diversification, becoming one of the most dynamic sec-
tors of the global economy. Nowadays, tourism represents worldwide a
significant driver for economic growth, accounting for about 10% of the
global economic activity. Tourism receipts represent over 5% of the world
exports (WTO, 2013). Increasing tourist arrivals worldwide have also trans-
lated into a larger contribution of tourism to countries’ Gross Domestic
Product (GDP) (WTO, Jansen, 2013) and as a consequence, tourism has
become one of the leading service sectors in many countries.
Tourism, as a global economic activity, favours socio-economic progress
within those territories where it is developed. There are multiple positive
effects derived from tourism such as the creation of jobs, its capability to
fix the population to the territory, or its ability to diversify agricultural
production in certain areas (Castañeda, 2010). For an increasing number of
countries, tourism represents a strategic sector that is to be supported and
protected through adequate legislation and infrastructure investments.
In Russia, the Target Programme on Internal and Inbound Tourism
Development in Russia (2011 2018) promotes tourism development in the
country as a means to achieve socio-economic prosperity. According to
figures published by the World Economic Forum in their Travel and
Tourism Competitiveness Report (2013), the tourism sector represents
1.5% of the Russian GDP, or 5.9% when considering other sectors that
are related to the tourism activity.
Tourism can serve as a tool towards increasing government revenues
through taxes and improving residents’ quality of life in a destination.
There are, however, potential negative environmental and social impacts
that must be managed for tourism to fulfil its promises.
3.1.2. Key Definitions
Destination management aims to involve and put to work together all the
stakeholders at the destination towards a common goal: to plan and
develop the destination product in an efficient and sustainable way, that is,
favouring socio-economic progress, ensuring environmental preservation,

and satisfying tourists’ needs and expectations when they visit the
destination.
Destination management is generally the responsibility of Destination
Management Organizations (DMOs) that are in charge of leading and
coordinating activities at the destination under a coherent strategy.
Although they do not control directly all activities implemented by the var-
ious agents within the destination, they bring together resources and exper-
tise and a degree of independence and objectivity to lead the way forward
(UNWTO, 2007, p. 2).
As it will be discussed next, destination management takes place at
tourism destinations that are a complex system of actors who work
within the same tourism space with a common objective: the competitive
and sustainable development of the destination. Destination managers
should optimise destination performance by minimising the negative
impacts of the tourism activity while maximising positive ones. According
to Bornhorst, Ritchie, and Sheeman (2010), there are a number of success
factors for a DMO:
• Results as measured by tourism and economic growth (visitor numbers,

hospitality metrics, etc.)
• Effective marketing strategies (quality and awareness of the destination
image and brand, media exposure, etc.)
• Providing and promoting quality destination attractions
• Creating quality tourist experiences (as measured by tourist satisfaction,
repeat visits, word of mouth and social media impact, etc.)
• Good community relations (local residents’ support of tourism and their
attitudes and behaviours towards tourists).
These factors must be taken into consideration and must be managed

effectively by DMOs for destination to become successful. It is, however,
difficult for any tourism organisation to control and manage tourism.
Indeed, tourism is multifaceted and is a complex system of private and
public stakeholders. Government, because of their legislative and
policy-making power, often have a strong impact on tourism development
and strategic management. As a result, the focus in destination manage-
ment has often been on marketing. In fact, DMO is often referring to
Destination Marketing Organisation. Such organisations are responsible
for making strategic marketing choices and implementing marketing action
plans designed to attract and satisfy tourists.
This chapter describes how the tourism sector is structured, its main
components as well as the relationships between them. The main objective
of the chapter is for the reader to understand the fundamental determinants
of tourism destination competitiveness (TDC), in order to adequately
manage towards this goal. The reader will have the opportunity to consider
and reflect on the various costs and benefits of tourism and to assess how
destination management should optimise positive impacts while minimising
the negative impacts of tourism. Accordingly, the sustainability of the desti-
nation should be a key concern when planning and managing tourism.
3.2. The Tourism System
3.2.1. The Tourism Product and the Tourism Sector
The tourism development of a territory is based on designing, developing,

and promoting a number of attractions for tourists as well as providing
the services that are needed for tourists to access and sojourn in a desti-
nation. Tourism attractions are normally based upon the resources avail-
able at the destination. Undoubtedly, those territories whose endowed
resources have a high value will have a comparative advantage over
others who do not have them. For example, a destination that benefits
from an extraordinary natural setting (e.g. the French Riviera on the
Mediterranean Sea) or cultural resources (e.g. St Petersburg with its
museum and classic architecture) has strong comparative advantages that
favour the development of tourism. However through tourism infrastruc-
ture investments, such as those made in Sochi in preparation for the 2014
Winter Olympics Games, territories can create tourism resources, achiev-
ing competitive advantages that lead them to get a better positioning at
global markets.
Thereby, resources or attractions at the destination, created ex nihilo or
already existing, are the basis upon which private and public agents plan
and develop the tourism products that represent the unique value proposi-
tion of the destination to be communicated. From a holistic point of view,
every tourism destination may be considered as a complete tourism pro-
duct. That is why there is a wide consensus about considering the tourism
destination as the unit of analysis when studying the tourism sector (WTO,
2002). Thus, the destination becomes the basic geographic unit where tour-
ism activities are planned, managed and sold. Accordingly, for many
authors, destinations are the most relevant brands within the tourism sector
(Morgan, Pritchard, & Pride, 2004, 2011).
Figure 3.1 describes all the stakeholders that interact within a destina-
tion, and that cooperate to define and supply the value proposition of the
tourism destination. As can be observed, the destination represents a com-
plex social system, a so-called destination system, composed by three basic
subsystems: tourists, tourism supply providers, and state and other organi-
sations and institutions.
Figure 3.1: The main components of the tourism destination.
Box 3.1: The Destination System

The destination system is confined by the scope of a specific spatial
unit, whose boundaries are determined by tourism demand, regard-
less of administrative borders. Because of these characteristics, a
destination system requires integrated management to achieve
the synergistic effect of coordinated horizontal management (terri-
torial management) and vertical management (branch or sector
management).
(Continued )
Development planning is a fundamental function of tourist destina-

tion management, and it is the primary function to which all other
destination management functions are connected. The importance of
proper destination development planning is evident in the need for
minimising potential flaws in a destination’s line and concept of
development. Organising is the next function in destination manage-
ment. It must be derived from, and aligned with, a previously estab-
lished destination plan, and it must focus on efficiently accomplishing
the planned goals and strategies. This function identifies the most
appropriate organisational structure for destination management,
which essentially requires the interaction of the public and private
sectors (Bosǩović, Saftić, & Trosť, 2010, p. 794).
Accordingly, the supply of tourism products at the destination depends

mainly upon private and public agents’ cooperation, but also upon other
agents who indirectly contribute in the global service delivered to tourists
at the destination, such as the host community and other stakeholders
such as environmental associations that work to preserve natural
resources at the destination. Consequently, destination attractiveness will
be determined by those agents’ capacity to coordinate their work, to com-
plement each other’s propositions, and to cooperate in designing, plan-
ning and implementing a destination strategy aimed at proposing a
differentiated and competitive value proposition. To go further, one can
suggest that tourism at a destination is made of a network that includes
at the same time three components: actors, non-human entities (such as
equipment and infrastructure) and interactions (Paget, Dimanche, &
Mounet, 2010; Van Der Duim, 2007).
Box 3.2: Tourism Destination — A Definition

A Tourism destination is a geographical area in which tourists spend
at least one overnight. It consists of all the services and infrastructure
necessary for the stay of a specific tourist or tourism segment. It has
a physical and administrative frontiers defining its management, its
image and positioning which determines its market competitiveness
(UNWTO, 2007; WTO, 2002).
Various destination levels may be distinguished according to the scope

of the territory that is defined as the tourism destination. Macro-products
destinations and micro-products destinations can be differentiated.
Likewise, it is possible to talk about ‘macro-destinations’ when addressing
countries or territorial units. For instance, the ‘Russian Federation’ or ‘The
Alps’, which comprises Austrian, Italian, Swiss and French territories,
among others. Within these so-called ‘macro-destinations’, multiple micro-
destinations can be identified, such as, for instance, cities (e.g. Moscow,
St. Petersburg or Sochi within Russia), natural parks (e.g. Chavash
Varmane or Valdaysky National Park in Russia) or ski resorts (St Anton,
St Moritz or Courchevel in the Alps).
Therefore, a ‘macro-destination’ comprises ‘micro-destinations’ which in
turn are the result of the aggregation of the various tourism products pack-
aged and commercialised within that territorial unit. The description of the
different levels that can be considered when defining a tourism product
demonstrates how intricate a system of resources and actors at the level of
a ‘macro-destination’ or ‘micro-destination’ can be. Obviously, the manage-
rial implications for destination brands such as ‘Europe’ or ‘the Alps’ are
more complex and require more coordination efforts by all stakeholders
within the territory, than the management of smaller areas such as a city.
While the distinction between different tourism products/destinations
levels is useful when defining the scope and complexity of destination man-
agement, from a demand approach, destinations are understood as ‘amal-
gams of tourism products, providing a unified experience to consumers’.
Consequently, while destinations were traditionally viewed as well-defined
geographical areas, nowadays it is widely accepted that a destination has
become a perceptual notion, which is interpreted subjectively by consumers
(Buhalis, 2000, p. 97).
From a supply perspective, Figure 3.2 describes how tourism destina-
tions are resulting from the coordinated efforts of many different actors.
Transport infrastructure provides accessibility to destination resources,
attractions, accommodation, catering services and to leisure activities or
business meeting providers. Tourists become the centre for whom the desti-
nation value proposition is designed. Accordingly, the different agents
interact with tourists and DMOs may contribute to coordinate those
actions. Consequently, DMOs play an essential role at the destination.
They assemble the functions of all actors responsible for tourism; they
encourage cooperation between them to design and complement the
global offer of the destination, as well as to build together the destination
image. They organise communication towards target markets, reinforce
Host community
Communication Hospitality and

and Branding related services
Attractions,
Natural and
Cultural THE TOURIST
attractions,
entertainment
Tourists
Events and mega
information and
events
guiding services
Destination Tour operators

Management and Travel
Organizations Agencies
Transportation
Figure 3.2: The tourism system.
destination positioning and ensure the sustainability of the destination.

Additionally, DMOs may facilitate distribution efforts, linking supply with
tourist demand. Finally, DMOs may contribute to manage the host com-
munity by encouraging it to welcome tourists.
Figure 3.2 only shows those aspects that are directly related to the tour-
ism sector. Accordingly, direct effects reflect direct tourist spending on
tourism services. But the great power of the tourism sector is to induce
socio-economic growth across the territories where it is developed, through
indirect effects. Indirect effects appear when the tourism activity leads to
providing benefits to non-tourism sectors in the local economy such as con-
struction, furniture making or agriculture (see Figure 3.3). Moreover, the
tourism activity has ‘induced effects’ resulting from the increased income of
wage-earners who are active in the tourism economy. Consequently, the
tourism sector is described as ‘a complex sector, which has direct, indirect
Figure 3.3: Backward linkages in the tourism sector. Source: Adapted

from Honeck (2012), Bolwell and Weinz (2008).
and induced effects over the economy of the areas where it is developed,
and subsequently, has multiple backward and forward linkages into diverse
sectors of the economy’ (Jansen, WTO, 2013, p. 18).
Figure 3.3 shows how tourism brings together many actors who propose
services at the destination. They are directly or indirectly related to tour-
ism, but all contribute to the tourism destination.
3.2.2. The Tourism System Components
3.2.2.1. The tourist

The tourist has the central role in the tourism system. Tourists and their
needs stand as the main driving force behind destination planning, develop-
ment and management. Tourism demand at the destination is composed of
national and international tourists. National demand normally represents a
more stable flow of visitors, based upon which tourism can be planned and
developed. International arrivals are more often subject to ups and downs
due to exchange rate fluctuations, geopolitical issues, and changing destina-
tion image. When national demand reaches a critical mass, government will
often provide public services to support the tourism activity that are not
provided by the private sector.
A qualitative analysis of the local demand may explain the shape and
character of the tourism sector at the destination. The more sophisticated
and demanding local tourists will be the more pressure on tourism compa-
nies to become more innovative and competitive. Given the importance of
tourists as part of the tourism system, the next chapter will focus on tour-
ists and their needs and behaviours.
3.2.2.2. DMOs
Destination marketing and management organisations (DMOs), at the
supra-national, national, regional, or city levels, are key actors in the devel-
opment of tourism. DMOs’ main objective is to help achieve the common
objectives of the destination, by bringing together locals’ and the tourism
sector’s interests. It follows that DMOs must develop a high level of com-
petence in promoting and supporting partnerships among stakeholders.
Destination tourism offices were initially agents undertaking promo-
tional activities for the destination. This is why they have been called
Destination Marketing Organisations. Their role is now becoming wider,
and many DMOs are now the strategic leader in destination development
and management.
According to Ritchie and Crouch (2003), there are some internal and
external activities that are essential to an effective, productive and
smoothly operating DMO. Internal activities are related to the definition of
organisational by-laws, the agreement of committee structures, the funding
system, the determination of the operational procedures, membership man-
agement, etc. External activities refer to marketing, tourist management,
human resources management, service design, resources stewardship, etc.
There is a now a strong recognition of the importance of the role of DMOs
for destinations to effectively compete at the international level.
3.2.2.3. Where supply and demand meet — communication and distribution

Tourism service providers are connected to tourists through tourism mar-
keting channels consisting in intermediaries and facilitators, such as travel
agencies and tour operators. These intermediaries accomplish a number of
key functions to facilitate the development of tourism (Middleton, 1994,
cited in Ritchie & Crouch, 2003, p. 101):
Buying in bulk and sorting and assembling tourism services into pack-
aged tourism products
Providing a network that more effectively reaches into the target

markets
Communicating the tourism product information; branding to enhance
awareness and customer trust
Proposing a point of contact for consumers: advising and purchasing
assistance; offering possibilities for immediate purchase or for booking
in advance; receiving and assisting with customer complaints
Financing part of the transfer of services to customers by purchasing
services and reservation in advance; receiving and transmitting sales rev-
enue to service providers
Making available marketing intelligence for service providers and
destinations
Sharing risks with regards to demand fluctuations and uncertainty.
Distribution channels for a destination are retail travel agents; whole-

sale travel agents; tour operators; online retailers and distributors; book-
ing agencies (e.g. for accommodations); incentive travel organisers;
conference organisers. At the destination, tourists can also buy services
directly from the service provider, or from local operators and even from
DMOs who are sometimes selling tourism services such as accommodation
and tours.
The internet is increasingly used by travellers as a source of information
and as a channel of distribution. Travellers buy services online from their
home or office computers, but they also buy from a tablet or from their
mobile phones when they are in the destination.
3.2.2.4. Transportation
Transportation services make it possible for tourists to access the destina-
tion and to travel within the destination. Commercial transportation links
between source/generating regions and destinations are essential to tourism
development: The destination must be made conveniently accessible at a
competitive price. Airlines, bus and coach services, railway services, car
hire services, ferry services and local public transportation systems all con-
tribute to provide mobility services to and at the destination. Such services
must be made available to tourists, either locally or in their region/country
of origin, through adequate distribution channels.
3.2.2.5. Hospitality and related services

Once arrived in a destination, tourists are ‘hosted’ in a hospitable
manner. A destination and its hosts provide a number of hospitality
services to the visitors. They need hotels and other accommodations to

spend the night, food and beverage services in restaurant, bars or cafeter-
ias. Business travellers will use exhibition and conference centres for their
meetings, as well as catering services. The hotel sector is usually one of the
key players in a destination. The success of a destination is often measured
by hotel management metrics such as occupancy rates, average daily rate
(ADR) or revenue per available room (REVPAR).
Recently the sharing economy has led to the development of new hospi-
tality concepts such as airbnb (founded in 2008 as Airbedandbreakfast.
com) or couch surfing (founded in 2004 as an association; it became a com-
mercial entity in 2011). Such hospitality alternatives propose a booking
platform where tourists can rent a room, an apartment, or a house from
private individuals.
3.2.2.6. Attractions, entertainment, etc.

Theme parks, national and state nature or cultural parks, museums and art
galleries, gardens, heritage and historical sites, recreational sports facilities,
entertainment centres, or casinos are all attractions that may be the
primary reason why tourists visit a destination or that are used for enter-
tainment while visiting friends or family or attending a conference. Tourists
need to be provided with meaningful activities that they may not do at
home. Such activities can be managed privately (e.g. theme park or golf
courses) or by the public sector (e.g. nature parks or museums). Tourists
can be segmented based on the main reason why they visit a destination.
For example, they may be cultural tourists, nature tourists, or health and
wellness tourists.
3.2.2.7. Events and mega events

Events and festivals can be proposed as an additional product alternative
for tourists in a destination. For example, while holidaying at the beach,
tourists may benefit from food festivals or concerts. They are designed to
dynamise the destination and to create additional value for tourists.
Events can also be planned to be the main attraction and the main
reason why tourist may visit a destination. For example, tourists may visit
a city just to attend the concert of a touring pop singer, or they may sojourn
in a specific destination because of a renowned music festival (e.g. the
annual Jazz Festival in Antibes Juan les Pins, on the French Riviera), a spe-
cific sports event (e.g. the 2014 Olympic Games in Sochi) or a World’s fair
(e.g. the 2010 World Expo in Shanghai or the 2015 Expo in Milano).
Box 3.3: Expo 2015

Held in Milan, Italy, Expo 2015 explored the theme ‘Feeding the
Planet, Energy for Life’ for six months. The exposition site covered
110 hectares and was expected to attract 29 million visitors from May
through October 2015.
Visit www.expo2015.org
3.3. Tourism Destination Competitiveness
After reading about the main actors of the tourism system in the previous
section, the reader should understand (1) the multiple linkages that exist
between the various stakeholders involved in the tourism industry, and
(2) the relevance of setting the right environment where the tourism activity
can be successfully developed. The emergence of new tourism destinations
has intensified the competition between destinations to attract tourists and
to reap economic benefits from tourism. In this section, the main factors
that determine TDC are discussed, with the aim of providing a global
understanding of how destination planning policies and destination mar-
keting strategies should be implemented. The ultimate goal is for a destina-
tion to be attractive, competitive and sustainable.
3.3.1. The Starting Point: What Is Competitiveness for a

Tourism Destination?
In general, there is consensus about the fact that a tourism destination is

competitive when it has a robust capacity to attract visitors and to provide
them with satisfying and memorable experiences, in a cost-effective way,
while enhancing the well-being of the host populations and preserving the
natural and cultural resources (Ritchie & Crouch, 2003). But what are the
factors and conditions that lead a destination to evolve through a sustain-
able and competitive tourism model?
From an empirical perspective, the Travel and Tourism Competitiveness
Index (TTCI), which measures the TDC of 140 countries when attracting
international tourists, suggests that the main determinants of TDC are
(1) the cultural and natural destination resources; (2) the availability of
adequate infrastructure which makes destination resources available and

satisfying for tourists and (3) a healthy and favourable travel and tourism
regulatory framework (UNWTO, 2011; World Economic Forum (WEF),
2013). Some of these features make destinations attractive for tourists,
allowing them to achieve a differentiated position (such as natural
resources or cultural heritage) in tourism markets, while others, however,
allow destinations to get competitive advantages in the long term (such as
working towards a market economy). Figure 3.4 shows that the three main
components of the TTCI according to World Economic Forum are shown
with their corresponding indicators.
Figure 3.4: The three sub-indexes of the Travel and Tourism Competitiveness
Index. Source: Adapted from ‘The Travel & Tourism Competitiveness
Report 2013’, World Economic Forum (2013, p. 8).
This figure suggests that governments and public administrations at des-

tinations play a strategic role when establishing the appropriate conditions
and the needed environment for tourism to grow. Accordingly, two decisive
tasks to be accomplished in order to assure destination competitiveness are
establishing a suitable travel and tourism regulatory framework and pro-
viding basic infrastructure.
The best competitiveness indicator for a tourism destination is that the
destination observes a steady growth over the time measured through
the tourists flows to the destination (Ringbeck & Pietsch, 2013). These
authors proposed the TTSGPS index (Travel & Tourism Stable Growth
Performance Score) to measure competitiveness. They concluded that
the main predictors of a stable growth performance at destinations were

(1) affinity for travel and tourism; (2) guaranteeing safety at the destina-
tion; (3) the existence of a favourable regulatory framework for tourism;
(4) environmental sustainability and (5) price competitiveness.
3.3.2. Brief Overview of the Academic Literature on TDC
The aim of this section is to identify the fundamental variables that should
be considered by destination managers in order to reinforce TDC.
Following the review of TDC literature conducted by Andrades-Caldito,
Sanchez-Rivero, and Pulido-Fernandez (2013), the interpretation of
tourism TDC was traditionally focused on price levels and its influence on
the volume of demand (Dwyer, Forsyth, & Rao, 2000, 2001; Song &
Witt, 2000).
Notwithstanding, beyond price competitiveness, there are some other
relevant competitiveness attributes that can be considered. Buhalis (2000)
analysed the destination concept, and how the destination strategic market-
ing and management must be developed to enhance TDC. He concluded
that the challenge for destinations will be to supply unique and customised
tourism products by using flexibility and intra-destination co-operation.
Destination should be able to provide tourists with memorable experiences,
assuring tourists’ satisfaction, and encouraging tourists’ loyalty. This
should all contribute to fostering TDC. Moreover, Buhalis proposed the
‘six As framework for the analysis of tourism destination’ as a tool for
improving TDC. Accordingly, TDC is completed when an efficient man-
agement of the different core components of the destination — attractions,
accessibility, amenities, available packages, activities and ancillary
services — is performed.
Another important contribution to explaining TDC was formulated by
Enright, Scott, and Dodwell (1997), who identified two types of factors
that affect the competitiveness of firms and other organisations involved in
producing the tourism product: generic factors of destination attractiveness
and generic factors of competitiveness. Examples of generic factors of desti-
nation attractiveness are climate, landscape, accommodation and catering
services, communication and transportation facilities or major attractions
(Kim, 1998). Examples of generic factors of competitiveness are connected
to destination management practices and include a range of factors such as
inputs, inter-firm cooperation, industrial and regional clustering or internal
organisation and strategy of firms and institutions.
One of the most complete frameworks for studying TDC is Crouch &
Ritchie’s contribution (1999), which resulted from several studies
(Crouch & Ritchie, 1994, 1995; Ritchie & Crouch, 1993). Their rationale is
known as the Calgary Model. Largely, the main strength of their proposed
model lies in its ability to integrate all important factors that may charac-
terize the competitiveness of a tourism destination. According to their
model, four major components determine TDC:
• Core resources and attractors,

• Supporting factors and resources,
• Destination management,
• Qualifying determinants.
‘Core resources and attractors’ include the major elements of destination

appeal, which constitute the fundamental reasons why tourists choose to
visit one destination over another. That is, for instance, the case of factors
such as the climate, physiography, culture, history, singular events, types of
entertainment and variety of activities that tourists may choose to do at the
destination, or factors involving hosts’ relationships with the guests. Of
particular importance to this component is the tourism equipment at the
destination, mostly composed of accommodation facilities, food services,
transportation facilities and major attractions.
The other three components are essential for tourism destinations’ suc-
cess and sustainability, since they favour development based on the core
resources and attractors. ‘Supporting factors and resources’ provide a solid
foundation upon which a prosperous tourism industry can grow. This
dimension comprises accessibility to tourism resources, other infrastruc-
ture, facilitating resources such as financial, educational, or research insti-
tutions and entrepreneurship culture. ‘Qualifying determinants’ represent
factors that could limit a destination’s capacity to appeal to and satisfy
potential tourists and consequently affect its competitiveness. These factors
are, for instance, the destination physical location, the overall costs, or
health and safety. These factors are beyond the control of a DMO or the
tourism sector, but they play a key role in TDC. Lastly, ‘Destination man-
agement’ refers to all the activities that may affect the other components: A
wide range of actions that can expand the appeal of the core resources and
attractions, strengthen the effectiveness and quality of the supporting fac-
tors and resources, and best adjust to the restrictions imposed by the quali-
fying determinants. Destination management involves activities such as
destination marketing actions, services management, and organisation and
maintenance of the major tourism resources and attractions (Andrades-

Caldito et al., 2013).
Ritchie and Crouch added later a fifth competitiveness determinant to
the conceptual model: ‘Destination policy, planner and development’
(DPPD). Although there may appear to be overlap and/or duplication
between this fifth component and the ‘Destination Management’ compo-
nent (both components seek to manage the competitiveness and sustain-
ability of the destination), ‘they differ fundamentally in that DPPD is
essentially an intellectual process that uses information, judgment and
monitoring to make macro-level decisions regarding the kind of destination
that is desirable, the degree to which ongoing performance and related
changes in the nature of visitation and the physical character of the destina-
tion are contributing to the achievement of the kind of destination that sta-
keholders want’. This is the overall strategy of the destination, whereas in
contrast, ‘Destination Management’ is ‘more of a micro-level activity in
which all the many residents and industry stakeholders carry out their indi-
vidual and organizational responsibilities on a daily basis in efforts to rea-
lize the macro-level vision contained in policy, planning and development’
(Ritchie & Crouch, 2003, p. 147). As a result, for a destination to be a suc-
cess, both DPPD and ‘Destination Management’ must be properly done
and coordinated.
Dwyer and Kim (2003) categorised 81 indicators that characterise TDC
into the following groups: Resources; Supporting Factors; Destination
Management; Situational Conditions; Demand Factors and Market
Performance Indicators. Dwyer, Mellor, Livaic, Edwards, and Kim (2004)
went on to identify the principal elements that cause TDC: Endowed
resources and the destination management. Both elements interact with
tourism demand and situational conditions to influence destination com-
petitiveness as well as socio-economic prosperity. Among the endowed
resources one can distinguish between natural (e.g. coast or lakes), heritage
(e.g. handicrafts, cuisine or language), and created resources (e.g. tourism
infrastructure, special events or shopping); and supporting resources, such
as general infrastructure or accessibility.
Another empirical proof of the relevance of destination resources and
their management to enhance TDC was provided by Enright and Newton
(2004), who involved a sample of practitioners in the tourism industry to
analyse the relative importance of 15 tourism attractors and 37 business
factors over international destinations competitiveness. Their results
provided strong support for the Crouch and Ritchie’s combined approach
to TDC, and warned about the fact that some of the business-related fac-
tors were viewed by industry participants as being far more important than
some of the tourism attractions. This suggests that endowed resources
could be less relevant than destination management for improving TDC,
and consequently comparative advantages may be surpassed by competitive
advantages obtained through efficient destination management.
Moreover, Gooroochurn and Sugiyarto (2005) used the World
Travel and Tourism Council (WTTC) competitiveness indicators to appraise
TDC and classify destinations according to their competitive strengths.
Those indicators were price competitiveness; human tourism; infrastructure;
environment; technology; human resources; openness and social
competitiveness.
More recently, Crouch (2011) postulated a new insight into the magni-
tude and impact of attributes which have an effect on TDC. Based upon
the gathering and analysis of expert judgments, he demonstrated that
between the five major destination competitiveness factors from the
Calgary Model, the Core Resources and Attractor category stands visibly
above the other four, in terms of the relevance of this set of attributes.
Besides, within each of the five major factors, the study showed that
the sub factors presenting the highest significance were Physiographic
and Climate, Accessibility, Positioning/Branding, Quality of Service/
Experience, and Safety and Security. Crouch highlighted the importance of
managing destination image and reputation in the tourism market, assign-
ing a special value to marketing activities oriented to positioning the desti-
nation. As a result, he advised to consider the suitability of monitoring and
assessing all competitiveness attributes, with the aim of supporting destina-
tion management.
All research efforts come together to highlight two key issues determin-
ing TDC: (1) the quality of a destination’s resources and (2) the need for an
effective management to meet tourists’ expectations. Custodio-Santos,
Ferreira, and Costa (2014) pointed out another important issue to be
considered when managing destination competitiveness: the destination
life cycle. Mature destinations tend to be more cooperative and agile
when facing changes, showing an adaptive learning capability greater than
emerging destinations (McLennan, Brent, Ruhanen, & Moyle, 2014).
Consequently, a destination’s capacity to adapt to its changing environ-
ment varies along its life cycle.
3.3.3. Managing TDC: Tourism Destinations as a

Service Delivery System
After reviewing the most significant contributions that explain TDC deter-
minants, we need to address the competitive environment where destina-
tions perform their activity. Figure 3.5 summarises the main factors that
determine destination attractiveness together with the competitive environ-
ment where destinations deliver services to tourists.
On the left-hand side of Figure 3.5, the different competing destinations
are represented. So competitors X, Y, and Z compete with the destination
that is represented at the centre left of the figure.
Tourism destinations have been represented as a service delivery system.
Accordingly, from a tourist point of view, there are a number of activities
that are performed at the destination, some of which are visible while
others remain invisible.
Tourists experience directly the ‘visible side’ of the destination’s manage-
ment. Since destination managers control the unanimated environment,
composed by the main resources and attractors of the destination as well as
other supporting resources, they have an impact on how the experience will
be perceived by tourists. Tourists may feel more or less satisfied, depending
on how managers perform their tasks.
Other aspects that are under destination managers’ influence may affect
directly tourists’ impressions of the destination: For example, the quality of
the services provided by contact personnel in hotels, restaurants, and other
care and treatment services. Although individual businesses will manage
quality, it is up to the destination managers to encourage and provide tools
for the pursuit of quality in the destination. Again, tourists’ experiences
will depend on the effectiveness of such management initiatives.
Behind the visible stage where tourism staff provides services to visitors,
the organisation of the destination takes place. Core activities like
Destination Planning Policy and Development, in the long term, as well as
Destination Marketing, in the short term, are accomplished to provide the
right framework for the sustainable development of the tourism activity at
the destination. This part of destination management is what we call the
‘invisible side’ because tourists may only experience the management of
these factors in an indirect way. On this ‘invisible side’ of the destination
organisation, qualifying and amplifying determinants of TDC, for instance
destination carrying capacity, are controlled.
Although tourists only interact directly with the visible side of the desti-
nation, they do experience the whole place, and as a consequence, they
ALTERNATIVE TOURISM DESTINATIONS DEMAND CONDITIONS
Tourists’ experiences
Competitor X Competitor Z
Competitor Y Pre-consumption
Competitive Comparative
advantages advantages
perceived images
Tourism destinations
Situational
Tourist A Conditions
Organization Unanimated environment
Core resources and During

Destination policy, Attractors consumption
Planning and
Development
Tourists’ expectations
Supporting factors and
Tourist B
Communication - Social media
resources
Qualifying and Tourist C
amplifying
Contact personnel
Determinants Set of destination
Accommodations and advantages/
Destination Restaurants
Post-consumption benefits perceived
Management
Care and treatment by the tourist C
ia
ed
TOURISM DESTINATION
Perceived value per money lm
o cia
Tourism destination perceived image

INVISIBLE VISIBLE -S
n
tio
ica
Tourism Destination as a service delivery system un
m
Com
Set of destination advantages/ TOURISM MARKETS

benefits perceived by the tourist A
Figure 3.5: Tourism destinations and tourism markets: A service delivery system approach.
Tourism Management
77
indirectly perceive the effects of the destination managers’ decisions about

the ‘hidden elements’ of the destination. So tourists will elaborate in their
minds a destination image, based upon previous knowledge, expectations,
and experience at the destination.
As an outcome of the left-hand side of the figure, destinations project an
image to various markets and tourists perceive that image as compared
with other destination images that are projected by competing destinations.
Competitive and comparative advantages are taken into consideration
when potential visitors compare destinations, and as a result, some destina-
tions are better positioned than others in the minds of tourists.
Finally, on the right-hand side of the figure, the tourist experience at the
destination is described. This will be discussed further in the next chapter,
which addresses tourists’ experiences and behaviours. We can already state
that tourism demand for a destination will be very sensitive to destination
branding and promotion efforts as well as to word of mouth and peer eva-
luation of the destination. This is particularly true now that destination
digital marketing strategies increasingly rely upon social media to commu-
nicate with potential visitors. Again, cooperation between all destination
stakeholders becomes essential in order to broadcast a unified and attrac-
tive image of the destination.
3.4. Destination Planning, Development and Management
After describing in previous sections the importance of coordinated tourism

management to develop competitive and sustainable tourism destinations,
the following section addresses a global vision of tourism destination man-
agement and presents a value chain management approach. This approach
was selected because sustainability becomes a compulsory element to be
considered when managing destinations. A value chain management
approach offers an integrative vision of the tourism destination as a tour-
ism system and helps when identifying the essential aspects to be considered
when planning the destination development strategy. Consequently, the
section finalises with the description of the phases to implement in order to
design a strategic plan for tourism destinations development.
3.4.1. Tourism Destinations as a Value System
Many activities need to be implemented in the destination to produce the ser-

vices that tourists expect (see Figure 3.6). The objective is to support tourists
PRIMARY Operative, Destination Promotion
Tourism Destination Distribution Tourism services
ACTIVITIES: logistic and and communication delivery
Product (Tour operators, travel
(by public and private marketing (Destination image and
design agencies, OTAs) Customer service
agents) processes Branding)
Consumption
• Post-experience evaluation and
• Access to the destination: Sharing the experience:
• Destination commercialization • Service delivery at the destination: • Communication
• Transportation • Hospitality • Advocacy of the destination
• Leisure and other activities
• Mobility within the destination
Pre-
consumption Post-
experience
SUPPORTING Destination Activities towards Activities towards

Tourism Activities towards cooperation with
Policy and human resources Product development
ACTIVITIES: Infrastructure related industries
Planning empowerment
Figure 3.6: Tourism destinations as a value system, a value chain approach.

Tourism Management
79
throughout their customer journey, from the time they plan a trip, choose a
destination, consume the tourism product, to the time when they return
home and evaluate their experience, share their feedback to other potential
customers, and contribute to reinforce or alter the image of the destination.
As the figure suggests, the activities that are performed at the destination
to ensure satisfying tourist experiences are numerous and varied. The upper
part of the figure presents all the marketing activities developed to promote
and supply the tourism product. The bottom chain presents supporting
activities, which, according to Figure 3.5, take place at the back stage of
the destination and that are only indirectly experienced by tourists. Those
activities are in general related to destination policy and planning: They
address the provision of needed infrastructure, the development of human
resources, the development of tourism products, etc.
3.4.2. Destination Planning and Policy
According to Ritchie and Crouch (2003, p. 147), Destination planning and

policy is ‘essentially an intellectual process that uses information judgment
and monitoring to make macro-level decisions regarding the kind of destina-
tion that is desirable, the degree to which ongoing performance and related
changes in the nature of visitation and the physical character of the destination
are contributing to the achievement of the kind of destination that the stake-
holders want.’ There are several tasks to be implemented when planning: On
the one hand, those that relate to the definition of the common long-term
vision of the destination and the agreement of the goals to be pursued in the
long, mid and short term. On the other hand, there are tasks to be con-
ducted about analysing the external (economic, social and environmental
assessment, market analysis, scenarios) and internal (stakeholders analysis,
infrastructure and resource assessment, feasibility analysis) environment of
the destination in order to appraise whether the objectives agreed upon are
feasible and appropriate. Finally, the draft plan must be consulted before
being implemented and finally, after implementation, a monitoring process
must be followed to assess and review the outcomes (Hall, 2008).
3.4.3. Sustainable Destination Management and

Intra-Destination Cooperation
Two essential transversal aspects must be considered when planning desti-

nation policy and strategy: sustainability and cooperation between all
agents involved in destination development.
3.4.3.1. Sustainability
Destinations must address and minimise the negative impacts on society
and the environment that result from tourism activities. Consequently, sus-
tainable management deals with ensuring the viability and competitiveness
of tourism destinations and organisations while assuring that natural
resources, culture and heritage are preserved. Also, sustainable manage-
ment means increasing quality of life for host communities, optimising the
contribution of tourism to their economies, supporting local employment
and local products and services. To summarise, sustainable management is
about favouring the community well-being without being detrimental to its
environment. In addition, promoting social equity should be another objec-
tive to achieve for those destinations aiming to be sustainable. An impor-
tant related issue is to pursue the efficient use of resources, trying to
minimise consumption of scarce and non-renewable resources, minimising
the generation of waste and land, water, and air pollution.
To achieve all these objectives, from a sustainable perspective, it is essen-
tial that destination managers seek locals’ involvement when planning the
future of destination, and empower them in the decision making process
towards a desired and agreed upon future.
Lastly, from a tourist perspective, sustainable destinations must meet
tourists’ expectations by providing a safe and welcoming environment where
tourists can enjoy the activities proposed by the destination. Destinations
should make sure that they will welcome and respect all tourists and protect
them from discrimination based on gender, ethnic origin, sexual orientation,
disability or nationality.
3.4.3.2. Cooperation
A collaborative approach for destination management must be emphasised.
In a very competitive environment where new destinations appear each
year in the marketplace, competitive advantages can be achieved through
collaboration between all the destination stakeholders. To facilitate this
intra-destination cooperation, the DMO should play a decisive role and
provide the context where the various agents interested in the growth of
the destination will participate and share their vision about the destination.
A DMO will have (1) to identify all stakeholders and their degree of com-
mitment towards tourism; (2) to agree and share with the stakeholders a
common vision of the destination; and (3) to promote stakeholders’ com-
mitment to collaborate in destination planning and development.
Figure 3.7 synthetises the destination planning and policy process where
government, citizens, and tourism enterprises work together to enhance the
DESTINATION TARGET MARKETS
Tourists FACTORS SUPPORTING THE

DESTINATION MARKETING
Investors Attractions DESTINATION

and resources PLANNING AND POLICY
Business community
Tourism PLANNING
GROUP (DMO)
New residents Infrastructure
Locals Government
Host Community
Exporters
Image and Quality of life
Manufacturers
Corporate headquarters
Figure 3.7: The destination planning and policy context. Source: Adapted
from Kotler, Hamlin, Rein, and Haider (2002, p. 46).
destination. All elements that need to be considered will serve as the basis
upon which destination marketing objectives and strategies will be devel-
oped. A wide range of target markets may be considered when planning the
destination and designing its marketing strategies. The target markets for ter-
ritorial marketing are not only tourists; they are also potential investors and
developers, new residents, manufacturers, etc., but the tourist infrastructure
and the destination appeal certainly contribute to attract economic activity.
3.4.4. Marketing Management
Marketing is customer-centred. Service and product design and marketing

strategies are based on consumers’ needs and wants. A marketing orienta-
tion assumes that destinations must consider tourists’ expectations and
desires when planning the tourism destination. Thereby, tourism marketing
can be defined as a managerial function oriented towards organising and
selling the destination and its services according to the needs of the markets
targeted by the destination. Consequently, marketing deals on the one
hand with market segmentation and targeting, to select those tourist
segments which are most attractive, appropriate, and profitable for the des-
tination, and on the other hand with the design and development of tourist
services. When a segmentation strategy and a product development strategy
have been determined, the destination is then positioned in the mind of tar-
geted tourists.
Adopting a marketing approach in destination management means that
specific tourism products are going to be designed to meet the needs of
those tourists targeted by the destination. Moreover, marketing deals also
with the destination communication and promotion, destination image
management and branding. Tourism marketing must make the destination
and its supply accessible for tourists, placing the services for sale at the
right place and at the right price for tourists to buy. To summarise, market-
ing refers to all activities that are developed at the destination to satisfy
tourists’ needs and to meet the destination objectives. From a sustainable
point of view, these objectives will be related to achieving an advantageous
position in the market, being profitable while preserving singular resources,
and safeguarding the interests of the host community.
Since supplying tourism products consists in delivering services to tour-
ists, tourism marketing becomes more complex than merely managing the
traditional marketing mix: product, pricing, distribution and promotion.
Tourism marketing, as service marketing, should also pay attention to the
environment or physical context where the tourism service is delivered, and
to the interactions between staff and customers and to customer-to-
customer interactions. Effective marketing requires a total effort from all
delivering services in the destination.
It is important to facilitate and stimulate tourist involvement and parti-
cipation in the service delivery to optimise the tourists’ experiences
(Andrades & Dimanche, 2014). Tourism firms should introduce mechan-
isms that allow tourists to express themselves and to co-create the experi-
ence with the service provider. This will enhance the tourist experience and
make it unique and memorable.
3.4.4.1. The Marketing plan

All marketing actions should be identified in the destination marketing
plan. The marketing plan is a document that reflects the shared vision of
the destination. This plan first includes an analysis of the current business
environment:
• The competitive environment (who are the competitors? What are they
doing? How successful are they?);
• The external environment (an analysis of the external factors that affect
tourism, the destination, and its businesses political, economic, social,
technological, legal, and environmental).
Such external analysis allows managers to identify opportunities and

threats.
In addition, an internal analysis should be conducted to identify the
strengths and weaknesses of the destination. Factors to consider may relate
to finance and investment capabilities, training and education levels of
tourism workers, overall quality of the tourism products, accessibility to
the destination, profitability of target markets, destination image, or the
various components of the marketing mix: product, price, distribution and
communication.
Such SWOT analysis (Strengths, Weaknesses, Opportunities and
Threats) can be used to match strengths and opportunities in order to find
competitive advantages. Another way is to convert weaknesses or threats
into strengths or opportunities. In all cases, the results of the SWOT analy-
sis should help evaluate the objectives of the destination or the business.
Based upon the external and internal environmental evaluation, destination
stakeholders agree with the objectives to be pursued and the subsequent
strategies and actions to be implemented. Finally, the marketing plan speci-
fies the monitoring plan, with the possible corrective actions in case of
deviations, as well as the forecast marketing budget. The strategies and
actions outlined in the plan will address decisions related to the marketing
mix of the destination: tourism products to be developed, brands to be pro-
moted, standards of service quality, pricing, distribution channels and
methods to reach the targets, promotion campaigns, online positioning of
the destination, etc.
3.5. Russia as a Tourism Destination

3.5.1. Tourism in Russia — How Is It Organised?
As previously discussed in the section devoted to TDC, Figure 3.4 illus-

trates the roles that governments and public authorities have when estab-
lishing the context that will allow for the development of a competitive
tourism sector. Figure 3.8 addresses the organisation of tourism in the
Russian Federation. The main body responsible at the national level for
Ministry of Culture of the Russian Federation
(Department of tourism and regional politic)
Federal State Statistic

service
Federal Agency for Tourism
(including Federal register of tour operators)
Regional State Statistic

services
Regional tourism administrations
(ministries, departments, comities) Tourism-informational centres
Public organizations
(associations, tourist Universities in tourism
clusters managing organizations)
Private tourism sector: tourism industry,
infrastructure, and hospitality
Collaboration and reporting

Subordination
Figure 3.8: The public organisation of tourism in Russia.

Tourism Management
85
tourism is the Ministry of Culture, of which the Federal Agency of

Tourism depends. Additionally, there is a Federal Agency that provides
information and statistics to support tourism planning and policy-making.
Given the geographic scope of the country, public bodies at the regional
level implement tourism policies. Regional tourism administrations orga-
nise tourism development in each Russian region. They rely on regional
Tourism Information Centres and Tourism Clusters. In addition, regional
state statistical services and universities involved in tourism studies support
the regional government as well as the private tourism sector.
The figure shows the relationships between the private and public sector,
and how universities and tourism clusters represent the link between the
private and the public tourism stakeholders.
In the Russian tourism destination management system, the key role is
played by the regional tourist administrations and by the tourist informa-
tion centres. In this regard, the object of management is not only the tourist
destination itself but the whole region (a subject of Russian Federation).
After 2010, Russia has been actively using a cluster approach to tourism
development. Some of those clusters have been created as free economic
areas for tourism and recreation. Usually, the management company is
responsible for cluster planning, designing, implementation, development
and promotion.
Regarding financial support for tourism development, federal and regio-
nal tourism administrations in Russia have the possibility to favour a
steady tourism development with the support of public financial instru-
ments. With this aim, the Federal Target Programme on Internal and
Inbound Tourism Development in Russia (2011 2018) was approved. The
budget for this programme includes direct financial support for the regional
cluster initiatives that are compliant with efficiency and sustainability
requirements. Usually, financial support through this programme is pro-
vided to major tourism projects. This is of great significance for economic
and social development in the Russian Federation.
Since the Russian Federation now considers tourism as one of the high-
priority sectors for the country, the regional administrations usually design
Regional Target Programmes on Tourism Development. Such programmes
also include financial instruments for top-priority tourist projects. Usually,
federal or regional support is focused on financing the infrastructure com-
ponent of the projects — modernisation and construction of roads, hous-
ing, public utility infrastructure, etc. Besides that, the regional tourism
administrations favour public private partnership agreements for sustain-
able tourism development projects.
3.5.2. Tourism Management in Russia: Challenges and Opportunities
A tourism destination may be defined as a geographical territory located

within specific limits with various amenities and services to attract and
satisfy the needs of tourists. Tourism destinations should be considered as
open systems, constantly interacting with the external environment. The
following discussion describes Russia’s external environment.
As long as external environmental factors may not be directly influ-
enced by tourism policy-makers, the management process is usually lim-
ited to considering their influence, and identifying the potential threats
and opportunities. In general, the evolution of the country’s economy
affects tourism sector growth, since tourism demand depends upon
income per capita. In 2012, the WEF forecasted that the travel and tour-
ism sector represented 1.5% of the Russian GDP and 1.4% of global
employment. Furthermore, it is expected that the contribution of tourism
in the economy will grow for the next decade, to reach 3.9% of the GDP
in 2022.
According to the most recent statistics published by the WEF, real GDP
growth of the Russian economy in 2011 was 4.3%. This figure is positive,
because it supports the existence of a stable internal tourism demand. This
internal tourism demand becomes essential since it forces the destination to
provide basic services and infrastructure for tourists. Those investments
will help the country establish a basic tourism supply that will allow Russia
to increase international visits.
In addition, in order to appraise the stability of internal tourism
demand, it is relevant to analyse income per capita, which affects demand
for tourist services. When income per capita grows, people are more willing
to spend money on services, including travel services. According to the
WEF in 2011, the Russian GDP per capita was 16735.8$. Russian official
statistics state that for 2011 2013, Russians’ consumer expenses in recrea-
tion have increased moderately, from 1.86% to 2.05%. Although internal
demand for tourism services has not grown significantly, the number of
tourism-related firms in Russia has doubled from 2005 to 2013.
In the post-Soviet period, low quality of tourist services determined the
necessity to concentrate all management efforts on improving the tourism
sector and its services. First, efforts focused on transportation and accom-
modation facilities. The current basis for tourist accommodation comprises
various types of hotels: deluxe hotels, hostels, motels, business hotels,
boarding houses and others, which were developed across all regions of the
Russian Federation.
According to Travel and Tourism Competiveness Report of the World

Economic Forum, the Russian Federation ranks 63rd out of 140 countries
in the Travel and Tourism Competitiveness Index, with a 4.2 score on a
1 to 7 point scale. Although this score has kept almost constant since 2009,
the country has lost competitiveness as a tourism destination over last years
when comparing with other countries.
Although the country is ranked 37th and 39th respectively, on cultural
and natural resources, it is relegated to 92nd when appraising human
resources, mainly because of the lack of qualified workers. In addition,
when evaluating the affinity of the country for travel and tourism, Russia
ranks at a disturbing 138th position out of the 140 countries in the analysis.
Issues such as host community attitudes towards international visitors, or
the lack of customer orientation at tourism companies hinder the develop-
ment of Russia as a tourism destination.
Box 3.4: Tourism Labour Qualification in Russia

Russia has a large number of colleges and professional higher educa-
tion institutions that deliver bachelor programmes in the area of tour-
ism; more than 30 also propose master programmes. In Russia,
universities specializing in tourism often offer programmes in the
area of service management.
The Moscow region has 150 universities, institutes, and academies
with curricula in tourism and services. At the college level similar spe-
cialties are present at 105 institutions. In addition, there are 72 voca-
tional establishments. Other subsystems of the Moscow regional
educational cluster include: (a) regional and municipal education
authorities; (b) institutions of secondary and pre-school education
with career guidance activities; (c) resource centres for life-long educa-
tion in the field of tourism and service; (d) companies with their own
training programs; (e) NGOs and not-for-profit organisations and
(f) industrial associations with educational and seminar programs.
This variety of different sources of education, skills and competencies
provide a good platform for the cluster’s sustainable development.
Source: Fedulin, Sakharchuk, and Ilkevich (2014).
Regarding the business environment sub-index, which is needed to

develop a robust tourism industry, Russia has good air transport and tour-
ism infrastructure (ranked 33rd and 40th, respectively) but not very good
ground infrastructure (ranked 93rd), making it difficult for tourists to

move across the country. Another negative factor for tourism development
is the price competitiveness of the tourism sector compared with other
countries (ranked 72nd). Nonetheless, without doubt, the main challenges
to be faced by the country are related to the travel and tourism regulatory
framework. In this sub-index Russia ranks 92nd. In general, policies and
tourism regulations, environmental sustainability, safety and security and
the prioritisation of the sector by the Government need to be improved.
Particularly relevant to tourism development are policies that limit tourists’
access to the country, such as the barriers to obtaining a visa. Another
important area of improvement is the implementation and effectiveness of
marketing strategies to attract tourists: Russia ranks only 123rd. Aspects
such as destination image and branding are nevertheless essential when
trying to attract international visitors.
Following the official statistics of the Russian Federation Statistical
Service (2014), Table 3.1 below presents the factors that are perceived as
barriers to the reinforcement of the business activity in the service sector in
2014. The factors are ranked from the most to the least significant.
Table 3.1: Barriers to a service industry development in Russia.
1 Lack of financial resources

2 Insufficient (uneven) demand for a specific kind of services
3 Current level of taxation
4 Large reporting load
5 Unfair competition from other organisations
6 Lack of qualified staff
7 High rent
8 High price for commercial credit
9 Lack of equipment and premises
10 Insufficient regulatory framework for specific activities
11 Governmental authority corruption
Again, the regulatory framework for the service industry becomes a key
area for improvement before allowing a healthy growth of the tourism sec-
tor. When considering tourism, the main challenges to be faced in the
future are (1) to increase effectiveness of tourism product development
based upon unique Russian resources; (2) to develop successful branding
and communication strategies for the country; (3) to provide an appeal-
ing hospitality atmosphere to host tourists and make them feel
comfortable and safe; (4) to improve service quality by increasing value for
money and consequently boosting price competitiveness; and (5) easing
accessibility to the destination.
3.5.2.1. Product design and resource management

Destination product design is one of the most controversial issues in
Russian tourism. It is based on the combination of tourist firms supplying
services and public tourism infrastructure. Conventional Russian practice
in tourism product development implied designing of a rigid sightseeing
programme for tourist groups. Today, we witness a shift towards
another approach, where tourists may choose excursions, animation pro-
grammes, food outlets, and other services, that they want to experience.
Consequently, the tourism sector in Russia is evolving from a mass and
controlled tourism offer, mainly supplied by tour operators who selected
the most attractive sights to be proposed to visitors, to a customization of
tourism services. Nowadays, online platforms like www.visitcity.com pro-
vide information and help tourists who want to organise their own visit to
the destination.
Box 3.5: Online Information for Visitors

Destination product development for tourists who prefer to organise
their own tour is generally performed using the tourist navigation sys-
tems. The most general overview of the Russian destination is pro-
vided on the tourist information centre website. Usually the address
of such website starts with www.visit, adding the name of the place
for which the information is required. In fact, this is the multi-
language portal of general tourist information. For example,
Tourism Development Center Red Izba is one such tourist office and
its multi-language internet portal www.visitnovgorod.ru is dedicated
to the one of the oldest Russian cities — Velikiy Novgorod. The por-
tal offers various information regarding the history, geography,
sights, and transport system of the city. On this website, a current
event guide is also available with city maps and description of various
alternatives such as children recreation, excursions, shopping, enter-
tainment, food and beverage, and accommodation. It is possible as
well to download an audioguide for Velikiy Novgorod Kremlin. Such
portals usually provide opportunities for online communication and
phone numbers for the 24/7 reference call centre.
Box 3.6: ICT in the Russian Federation: Live Map of Russia and
My Museum
In the past five years, a number of innovative Russian projects in the
area of tourism and ICT have been developed.
LIVING MAP OF RUSSIA is an innovative project for the crea-
tion of a unified information system consisting of an interactive tour-
ist map of Russia and its regions. This project creates the service and
navigation environment for tourists to move freely across the terri-
tory. It allows tourist companies and tourists to meet on a common
platform. Also, it has become a new tool to study and analyse tourist
behaviour. The project is implemented under the LIVING MAP OF
RUSSIA portal: http://www.2r.ru/.
The National Tourism Association, http://mytourism-rf.ru, imple-
ments another project called MY MUSEUM (http://mymuseumportal.
com), a community whose purpose is to bring together collectors and
museum workers to help them disseminate information for art profes-
sionals and tourists. The project is implemented as an instrument of
culture object integration into the tourism industry. The following
information is posted about a museum:
• Name and concept of the culture and art institution;
• Location (accurate address with geolocalisation and possibility to
generate public transportation routes);
• Creative description and visual representation of the main
artifacts;
• List of available tourist services;
• Event schedule;
• User feedback (tourist blog);
• The ‘best sights of the week’ rating.
This communication project is first of all orientated to individual
tourists who can design their own tour.
Another important aspect of product development is stewardship
of the resources available at the destination, since those resources
represent the core attractors and serve as a basis for tourism product
development. The availability of tourism resource registries has been
addressed in Russia in the past few years, although too few exist
today. Volume and structure of available resources at a destination
can be consulted.
Box 3.7: A Registry of Tourism Resources

The Hanty-Mansiysk Yugra Autonomous Okrug has a unified Yugra
Tourist Resource and Tourist Industry Organisation Registry divided
into two sections dedicated to tourist resources and tourist industry
organisations, respectively. Tourist resources are classified into sev-
eral categories: natural territories under special protection, historic
monuments, architectural monuments and ensembles, and archaeolo-
gical monuments.
The tourist industry organisations are divided into:
• Museums and exhibition halls;
• Theatres and concert halls;
• Houses and palaces of culture;
• Other social and cultural facilities;
• Organisations providing accommodation services;
• Recreation bases;
• Sanatoria and health resorts;
• Public food supply organisations;
• Entertainment facilities;
• Sport facilities;
• Tourist agencies;
• Tourist operators;
• Tourist industry organisations rendering the services on provision
of excursion guides, guiding interpreter and guiding instructors;
• Tourist industry organisations that sell souvenirs.
Regarding service quality management, an essential issue for Russia to

become a competitive tourism destination, there is a national regulatory
framework, which complements international ISO standards.
Consequently, the standardisation practice is well developed to facilitate
quality service management, and Russia has national standards (GOST and
GOST R) that establish the mandatory common requirements for the tourist
service in order to ensure safety, health, environmental protection, complex,
accurate, and timely performance, as well as optional requirements.
The number of provisions in the tourist service field is regulated by
the Russian Federation technical regulations system (GOST system).
Nowadays, the following documents are available online at http://
standartgost.ru for those who want to consulting them. A relatively new
practice is the development of a Hospitality Standard Complex, which is

defined as the document determining the characteristics of hospitality and
rules of tourist servicing within the territory of destination for the purpose
of voluntary repeated use. The objective of tourist destination hospitality
standard development is to create a favourable tourist environment within
the destination and ensure a proper level of hospitality, informational sup-
port and safety (see Figure 3.9).
Destination tourism
Product information
product information
availability
availability standard
Tourist destination visitor

Tourist safety
safety standard
Directions of the tourist Tourist destination

destination hospitality
comfortable visitor
standard complex
Development of a environment standard
development
comfortable tourist
environment
Hospitality code standard
Improvement of tourist
Tourist and excursion
and excursion service
service standard
quality
Figure 3.9: Tourist destination hospitality standards.
Box 3.8: Description of the GOST Regulatory Framework for

Tourism
GOST 28681.0-90 Tourist and Excursion Service Standardisation.
This standard establishes the target, tasks, standardisation objects
and standard complex structure for other documents regulating tour-
ist and excursion services.
GOST 28681.1-95 Tourist and Excursion Services. Tourist Service
Design. The standard establishes the procedure for preparing docu-
mentation related to tourist service design and is intended for various
(Continued )
organisations and enterprises and for individual entrepreneurs pro-

viding tourist services. This document determines the basic require-
ments in the area of tourist design.
GOST 28681.3-95 Tourist and Excursion Services. Requirements for
Ensuring Safety of Tourists and Excursionists. The standard contains
the requirements for tourist and excursion services in order to ensure
the safety of visitors and methods for compliance control. It is
intended to be mandatory tourist service certification.
GOST 28681.4-95 Tourist and Excursion Services. Hotel Classification.
The standard classifies various hotels and motels with accommodation
capacity not less than 10 rooms. Classification does not cover houses
and premises leased out for accommodation.
GOST R 50644-2009 Tourist Services. Requirements for Tourist
Safety. The standard determines the requirements for ensuring
the safety of tourist health and property during the travel. The stan-
dard covers legal entities regardless of their incorporation and owner-
ship form, and individual entrepreneurs providing tourist services.
GOST R 50646-2012 Services Rendered to Citizens. Terms and
Definitions. This standard gives the definitions for terms in the area
of standardisation, service quality management and compliance veri-
fication in the area of services rendered to citizens.
GOST R 50681-2010 Tourist Services. Tourist Service Design. This
standard determines the procedure and rules for tourist service
designing, including those being a part of the tourist product. The
standard is applied to legal entities regardless of their incorporation
and ownership form, and to individual entrepreneurs rendering tour-
ist services and/or services on designing the technical documentation
in the tourism field.
GOST R 50690-2000 Tourist Services. General Requirements. This
standard determines the general requirements for tourist services,
tourist health and property safety, and environmental protection.
The standard covers legal entities regardless of their incorporation
and ownership form, and to individual entrepreneurs rendering the
tourist services.
(Continued )
GOST R 52113-2003 Services Rendered to Citizens. Quality Indices

Nomenclature. The standard determines the procedure for choosing
the nomenclature for service quality indices in compliance with qual-
ity management goals, nomenclature, and classification of the quality
index evaluation and control. Provisions of standards cover services
rendered by entrepreneurs of various incorporation forms and to
individual entrepreneurs.
GOST R 53522-2009 Tourist and Excursion Services. Basic
Provisions. The standard covers tourist and excursion services and is
applied to legal entities regardless of their incorporation and owner-
ship form, and to individual entrepreneurs.
GOST Р 53997-2010 Tourist Services. Consumer Information.
General and Other Requirements. The standard determines the
requirements for information provided to the tourists.
3.6. Conclusions
The tourism sector has the potential to dynamise a country’s economy and
to provide many positive effects on society. However, negative impacts are
also linked to tourism development. This is why a sustainable tourism
planning and management approach is needed to make sure that the inter-
ests of the host community and its environment are preserved. Destination
policy-making and planning are essential. The basis for a competitive and
sustainable tourism development is the core endowed and created resources
of a destination, together with efficient destination management.
The Russian Federation as a tourism destination must face various chal-
lenges in order to enhance its competitiveness and improve its international
image as a tourism destination. In general, in an emerging destination, the
first things to be done are related to establishing an adequate travel and
tourism regulatory framework. At this stage, the public sector should take
the lead to create a favourable environment for tourism development.
Russia has taken some preliminary steps but needs to continue efforts to
improve the diversity and the quality of its tourism product as well as
accessibility for international travellers.
DISCUSSION QUESTIONS
1. Discuss the main benefits that tourism may bring to a territory.

2. For a territory to become a tourism destination, several conditions
should be met. Identify a set of conditions that are necessary for
the sustainable development of tourism.
3. Conduct a SWOT analysis for your city or region as a tourism
destination. What are your recommendations for tourism
development?
4. A tourism destination is a complex system. What are the main
parts of this system? How are stakeholders interacting with each
other?
5. What makes a destination sustainable and competitive? Can a des-
tination be sustainable and competitive? Explain.
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Chapter · September 2015

Lidia Andrades Frederic Dimanche

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3.1. Introduction to Destination Management

3.1. Introduction to Destination Management

According to the World Tourism Organization [UNWTO], the tourism

3.1.2. Key Definitions

favouring socio-economic progress, ensuring environmental preservation,

• Results as measured by tourism and economic growth (visitor numbers,

These factors must be taken into consideration and must be managed

3.2. The Tourism System

3.2.1. The Tourism Product and the Tourism Sector

The tourism development of a territory is based on designing, developing,

Figure 3.1: The main components of the tourism destination.

Box 3.1: The Destination System

Development planning is a fundamental function of tourist destina-

Accordingly, the supply of tourism products at the destination depends

Box 3.2: Tourism Destination — A Definition

Various destination levels may be distinguished according to the scope

Communication Hospitality and

Destination Tour operators

Figure 3.2: The tourism system.

destination positioning and ensure the sustainability of the destination.

Figure 3.3: Backward linkages in the tourism sector. Source: Adapted

3.2.2. The Tourism System Components

3.2.2.1. The tourist

3.2.2.3. Where supply and demand meet — communication and distribution

Providing a network that more effectively reaches into the target

Distribution channels for a destination are retail travel agents; whole-

3.2.2.5. Hospitality and related services

services to the visitors. They need hotels and other accommodations to

3.2.2.6. Attractions, entertainment, etc.

3.2.2.7. Events and mega events

Box 3.3: Expo 2015

3.3. Tourism Destination Competitiveness

3.3.1. The Starting Point: What Is Competitiveness for a

In general, there is consensus about the fact that a tourism destination is

adequate infrastructure which makes destination resources available and

This figure suggests that governments and public administrations at des-

the main predictors of a stable growth performance at destinations were

3.3.2. Brief Overview of the Academic Literature on TDC

• Core resources and attractors,

‘Core resources and attractors’ include the major elements of destination

maintenance of the major tourism resources and attractions (Andrades-

3.3.3. Managing TDC: Tourism Destinations as a

Core resources and During

Tourism destination perceived image

Set of destination advantages/ TOURISM MARKETS

indirectly perceive the effects of the destination managers’ decisions about

3.4. Destination Planning, Development and Management

After describing in previous sections the importance of coordinated tourism

3.4.1. Tourism Destinations as a Value System

Many activities need to be implemented in the destination to produce the ser-

SUPPORTING Destination Activities towards Activities towards

Figure 3.6: Tourism destinations as a value system, a value chain approach.

3.4.2. Destination Planning and Policy

According to Ritchie and Crouch (2003, p. 147), Destination planning and

3.4.3. Sustainable Destination Management and

Two essential transversal aspects must be considered when planning desti-