Journal of Destination Marketing & Management 2 (2013) 59–61
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Regional Spotlight
China's “smart tourism destination” initiative: A taste of the service-dominant logic Dan Wang a, Xiang (Robert) Li b,n, Yunpeng Li c a
School of Hotel & Tourism Management, The Hong Kong Polytechnic University, Hong Kong, PR China School of Hotel, Restaurant, and Tourism Management, University of South Carolina, USA c Department of Tourism Management, Capital University of Economics and Business, Beijing, PR China b
art ic l e i nf o
a b s t r a c t
Article history: Received 22 May 2013 Accepted 30 May 2013 Available online 1 July 2013
China's “smart tourism destination” initiative has sparked some research interests lately. This essay suggests taking the service-dominant logic as an alternative angle to understand the rationale and implications of smart tourism development in China. & 2013 Elsevier Ltd. All rights reserved.
Keywords: Service-dominant logic (SDL) Smart tourism Value co-creation Tourist experience Destination competitiveness Social media
The research and practices of marketing are undergoing some profound changes (Lehmann, McAlister, & Staelin, 2011; Li & Petrick, 2008). One line of thought that has drawn much attention lately is the service-dominant logic (SDL) (Vargo & Lusch, 2004a, 2004b). Vargo and Lusch (2004a) argued that in the past marketers function under a “goods-dominant” (G-D) logic, which focuses on producing tangible outputs, completing transactions, and maximizing profits. They advocate a new logic (i.e., SDL) centering on service provision, which proposes (Lusch, Vargo, & Tanniru, 2010, p. 22) “(1) a shift to a focus on the process of serving rather than the creation of goods; (2) a shift to the primacy of intangibles rather than tangibles in the firm's marketplace offering, (3) a shift to a focus on the creation and use of dynamic operant resources as opposed to the consumption and depletion of static operand resources, (4) a recognition of the strategic advantage of symmetric rather than asymmetric information, (5) a shift to conversation and dialog as opposed to propaganda, (6) an understanding that the firm can only make and follow through on value propositions rather than create or add value, (7) a shift in focus to relational rather than transactional exchange, and (8) a shift to an
n
Corresponding author. Tel.: +1 803 777 2764. E-mail addresses:
[email protected] (D. Wang),
[email protected] (X.(Li),
[email protected] (Y. Li). 2212-571X/$ - see front matter & 2013 Elsevier Ltd. All rights reserved. http://dx.doi.org/10.1016/j.jdmm.2013.05.004
emphasis on financial performance for information feedback and learning rather than a goal of profit maximization.” Collectively, SDL highlights customer-defined and co-created value, operant resources (knowledge and skills) as the fundamental source of competitive advantage, as well as two-way communication with customers and relationship management (Merz, He, & Vargo, 2009). Although some key premises of SDL remain controversial, a growing consensus has been reached that SDL could serve as an instrumental framework in understanding today's increasingly complex marketing phenomena (Li, in press). This spotlight discusses the SDL rationale behind China's recent “smart tourism destination” (STD) initiative. The STD initiative, coined officially by China's State Council of Chinese Central Government in 2009, refers to a platform on which information relating to tourists activities, the consumption of tourism products, and the status of tourism resources can be instantly integrated and then provided to tourists, enterprises, and organizations through a variety of end-user devices (Huang & Li, 2011; Zhang, Li, & Liu, 2012). Although a SDL lens is hardly sufficient to appreciate the profound implications of smart tourism development on destination infrastructure and technology development, this spotlight suggests SDL may be taken as an alternative angle to understand the context, necessity, and future directions of smart tourism development in China. As shown in Fig. 1, it has been suggested that a STD consists of three main components: Cloud Services, the Internet of Things (IoT), and End-User Internet Service System (Zhang et al., 2012). First, according to Dikaiakos, Katsaros, Mehra, Pallis, and Vakali
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1. Tourist experience
Fig. 1. The technology support system of smart tourism destination (adapted from Zhang et al., 2012).
(2009), the cloud services are designed to provide convenient and scalable access (e.g. measurable for payment per use) to applications, software, and data through web browsers. For example, a sophisticated tour guide system can serve a large number of tourists without being installed on any personal device. A centralized distribution system can serve any travel agents on a payper-use basis. The cloud services are the fundamentals of a smart destination. Second, the Internet of Things (IoT) refers to “the pervasive presence around us of a variety of things or objects— such as Radio-Frequency Identification (RFID) tags, sensors, actuators, mobile phones, etc.—which, through unique addressing schemes, are able to interact with each other and cooperate with their neighbors to reach common goals” (Atzori, Iera, & Morabito, 2010, p. 2787). The IoT system supports smart destinations in terms of (1) information and analysis; and (2) automation and control (Chui, Löffler, & Roberts, 2010). For example, in China's Sanya City, the IoT is applied to manage tourism scenic spots. Entrance tickets are embedded with RFID reader chips. Thus, tourists' locations and consumption behavior can be tracked, and presence-based advertising and payments can be implemented (Lin, 2011). As for automation and control, the system is designed to control the number of visitors to heritage sites in Sanya—The carrying capacity of heritage sites is monitored by a variety of sensors such as the sensors for air quality, crowdedness, and electricity consumption (Wu et al., 2012). The monitoring system is automatically connected with the ticketing system to implement pricing strategies that would affect visitor number. The third component of a smart destination is the End-User Internet Service System, which refers to the applications and equipment support of the cloud service and the Internet of Things at various levels of end-users (Huang & Li, 2011). For example, the design of individual payment systems is based on personal telecommunication devices such as smartphones and tablets. Wireless connections and touch screens are set up in scenic spots to serve tourists. Tourism service providers and government organizations are equipped with portals and connections to the cloud service. In China, approximately 33 cities have participated in the STD initiative. According to government officials of Zhenjiang, the first city proposed the concept in 2010, a STD is not merely about the digitalization and informalization in the tourism industry. Underlying this initiative are the transformation of tourist experience (co-created value), the changes of destination marketing strategy (relationship management), and a different view of destination competitiveness (operant resources, big data) (Tourunion News (06/01/2011)), which dovetail some aforementioned premises of SDL. As such, the rest of this commentary will discuss STD from these three perspectives.
In a STD, the co-creation of tourist experience entails not only experience customization by tourists, but more importantly, the increasing involvement of DMOs and other tourists' “experience sharing” (Chen, Drennan, & Andrews, 2012). On the one hand, the wide adoption of mobile tour guides designed by local DMOs allows close relationship building between DMOs and tourists, and the use of mobile tour guides helps maintain such relationship throughout their trips. For example, the city of Nanjing published “Nanjing Tour Assistant”, a mobile application for smartphones and tablets. This application provides not only comprehensive information about local attractions, but also location-based services (LBS) which equips tourists with a better understanding of the attractions and things surrounding them, as well as coupon information from merchants and restaurants nearby. In essence, DMOs are now playing an active role in helping tourists design their own experience. On the other hand, with the ubiquitous support of the Internet, tourists can instantly share stories and photos with others to acquire feedback and suggestions while the stories are still happening. The “Nanjing Tour Assistant” application provides connections with “Sina Weibo”, a Twitter equivalent in China. Thus, tourists who share the same interest (i.e. Nanjing as a tourism destination) are connected to share stories and exchange travel tips. As such, not only are tourists involved in experience creation, this co-creation is real-time and multi-directional (service provider-tourist, tourist-tourist, tourist-service provider). Presumably, such experience-sharing would enhance the value tourists receive from their travel.
2. Communication strategy Traditional destination marketing organizations (DMOs) employ one-way communication tools such as advertisements, brochures, or road shows. In contrast, DMOs of STDs pay more attention to carrying conversations with tourists via social media. For example, the Nanjing Tourism Development Committee adopted “Sina Weibo” to maintain two-way and instant communication with tourists. The “Sina Weibo” is a platform to publish destination news, government policies and regulations, promotions of events and activities, and tourists' stories. Moreover, the “Sina Weibo” is a channel to solicit tourists' opinions and suggestions, and ultimately serves as a customer relationship management tool. Tourists can receive instant replies regarding their questions and concerns from the online representatives of the local DMO. The micro-blog owned by the Nanjing Tourism Development Committee has attracted more than 200,000 fans. Through constant conversations with tourists, the local DMO can acquire more insights on the demands and preferences of tourists.
3. Destination competitiveness The construction of a smart tourism platform could win the destination a competitive edge. Nowadays, destinations' competitive advantage comes not only from their resource endowment, but also from their managerial effectiveness and ability for optimal resource allocation which may lead to truly sustainable tourism development (Laws, 1995). One feature of STDs is the use of “big data” to support business decision-making and resource allocation. The “big data” refers to datasets with sizes beyond the ability of commonly used software tools to capture, curate, manage, and process (Snijders, Matzat, & Reips, 2012). The analysis of “big data” can exact new insights in ways that affect markets, organizations, even relationships between citizens and governments (Mayer-Schonberger &
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Cukier, 2013). The applications of cloud service, the Internet of Things (IoT), and the contacts with tourists through Internet could produce a “big data” database covering information relating business transactions, tourism attractions, and tourists' behavior. In Nanjing, the local government expects that within 3–5 years, four modules of “big data” database will be established including the quality assurance module (e.g. complaints filing system, mega-event coordination system), tourism scenic area management module (e.g. eticketing system, tourist GIS system, parking statistics), travel agency monitoring module (e.g. contracts filing system, tour guides system, GIS positioning of tourist coaches), and accommodation monitoring module (online transactions filing system) (Nanjing Municipal Tourism Bureau, 2010). Owning these databases and the capabilities to use such databases, both as operant resources, may bring a unique competitive advantage to the destination. In conclusion, the STD initiative aims at revolutionizing tourist experience creation, as well as tourism business and destination marketing practices. According to Mr. Qiwei Shao, Chairman of the China National Tourism Administration (CNTA), the STD initiative was proposed to adapt to the worldwide rapid development of information technology, facilitate the internationalization of tourism industry in China, and enhance the quality of tourist experience (Shao, 2011). By making this a governmental initiative and practicing “smart tourism” on a destination (as opposed to business) scale, China might lead the world into a new era of tourism competition. Although one could readily appreciate this initiative as technical advances, this commentary invites readers to further consider its marketing rationale and implications. References Atzori, L., Iera, A., & Morabito, G. (2010). The internet of things: A survey. Computer Networks, 54(15), 2787–2805. Chen, T., Drennan, J., & Andrews, L. (2012). Experience sharing. Journal of Marketing Management, 28(13–14), 1535–1552. Chui, M., Löffler, M., & Roberts, R. (2010). The internet of things. McKinsey Quarterly, 2, 1–9.
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