Travel Reference
In-Depth Information
and the 'convergence of consumer needs and preference' (Ohmae 1989: 144), i.e. a frictionless
market. Paradoxically, on the other hand, there has also been an obvious trend of increas-
ing market diversity in household (due to lifestyle, ethnic, income, and age diversity) and business
(due to size, locations, and type of business) markets (Sheth, Sisodia and Sharma 2000). The
fragmented market is characterized by more porous segments, which may ultimately result in
individual customers being targeted (Oliver, Rust and Varki 1998; Varadarajan and Yadav 2002).
The strategic advantage of mass production has been overshadowed by that of mass customization
(Kotha 1995); correspondingly, it has been suggested that what marketers offer today should not
be merely 'products' but 'solutions' (Ettenson, Conrado and Knowles 2013; Tuli, Kohli and
Bharadwaj 2007). Tourists worldwide are developing more diversifi ed needs and tastes. Notably,
tourists from emerging markets are going through the same, yet much accelerated transition as
their counterparts in industrialized countries, from preferring conventional, mass-tourism
products to more unique, individualized travel experiences (Li
et al
. 2011; Ryan and Chen 2012).
Demanding customers and consumers and their empowered behaviour
Customers (both in B-to-B and household contexts) nowadays are facing a plethora of choices,
and have easy access and improved capability to acquire their choices. As a result, they 'are
demonstrating a keen interest in developing and exercising greater control over the communication
they receive and generate' (Varadarajan andYadav 2002: 308). Traditional intermediaries, without
whom transaction used to be impossible, get bypassed because direct transaction usually means a
better value proposition (Buhalis and Licata 2002; Sheth and Parvatiyar 1995). Today's tourists,
empowered by improved technology in an unprecedentedly transparent marketing environment,
are expecting better effi ciency and effectiveness brought by customer centric marketing
(Niininen, Buhalis and March 2007).
Adaptive organizations
Market organizations today are forced to be more market-driven and more agile and capable of
processing information (Achrol 1991). This is mainly due to changes in three dimensions
(Day and Montgomery 1999):
1 fewer broadcast and more interactive strategies, i.e. fi rms need to interactively address
individual needs and personalize the communication process;
2 more competition and more collaboration - a shift in mind-set is needed from transactional
to relationship exchanges. Moreover, in order to be successful in competition, an organiza-
tion needs to be a reliable co-operator fi rst (Morgan and Hunt 1994; Varadarajan
and Cunningham 1995);
3 more facts and less conjecture - information about market structure, market responses, and
market economics is of vital importance in decision-making. Consequently, never has market
information and strategy performance research been so important for destinations marketing
and management organizations as today (Williams, Stewart and Larsen 2012).
WhileVargo and Lusch (2008a) argued that the emergence of SDL is not justifi ed by the service
economy (and they claim 'all economies are service economies'), the abovementioned environ-
mental changes have clearly made the inadequacy of the goods-based conceptualization more
explicit, hence calling for a new frame of reference. Next the author turns to a brief synthesis of
the SDL.
