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  • Subject area(s): Marketing
  • Price: Free download
  • Published on: 14th September 2019
  • File format: Text
  • Number of pages: 2

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Implementation of information technologies within the hospitality industry is indispensable due to the necessity of creating competitive advantage and business development in the most attractive segments of the market. Information technology in the hospitality industry forms completely new conditions for business, management, marketing, and technological processes in the wide range of services. Utilizing of Information Systems becomes an integral part of successful organization. There is an old saying that “information is power” and it is especially applicable for the hospitality business because efficiency, reliability, accuracy, high-speed processing and delivering of information determines the effectiveness of management decisions, as information is data converted into a meaningful and useful context [2]. Deployment of these terms is possible only in the framework of the application of information systems.

There are several segments within the hospitality Industry; there are travel and tourism, food and beverage, and accommodations [1]. Each of them is using information technologies which allow to boost process of providing services, generating more profit, tracking business processes, calculating and reducing production costs, managing a supply chain, improving labor productivity, increasing the quality of customer service, and overall simplifying a cashflow and workflow within a company. Hospitality industry has not focused anymore only on making profit, since it is more beneficial to be customer oriented. Consequently, nowadays development of the hospitality industry takes place when the influence of information technologies can significantly improve the quality of service because of the effective use of management information systems. Management information systems is a business function… which moves information about people, products, and processes across the company to facilitate decision making and problem solving [2].

This paper examines the impact of information systems on business objectives within the all segments of the hospitality industry.

Travel and tourism sphere the most depends on information technologies. Travel services is a field where gathering, processing, delivering, and storing of information are crucial for every day functioning. Tourism today is a global computerized business that involves airlines, trains, cruise ships, hotel chains, and tourism corporations of the whole world [1]. It is known that tourism became more flexible and attractive for both customers and businesses due to the wide usage of technologies. Travel and tourism segment heavily relies on the Internet, reservations systems, computer systems, and mobile communication [3]. The Internet is a massive network that connects computers all over the world and allows them to communicate with one another [2]. The Internet enables a company to buy, to sell, to advertise, and to communicate with customers in real time over websites, blogs, online advertising, social media, online ordering and information repositories [3].

Rising in the number of airlines as well as the growth of demand on air transportation naturally led to the necessity of creation the computer reservation systems CRS (Computer Reservation System), which became the main tool for reservation of airlines' tickets and later helped travel agencies to simplify bookings of customers [4]. The first CRS were Apollo by Company United Airlines and Sabre by American Airlines company; there were the largest civil data processing systems in the world [4]. It significantly improved efficiency of the airlines\' staff, bettered customer service by reducing the time of ticket issuing, and scaled down the labor costs because of decreasing number of employees involved in booking of ticket.

Over time, technology was improved and the traditional travel services model was forced to change due to the increased demand to purchase services at a comfortable way and at no cost or burden [5]. Hence, airlines could benefit the most from the Internet and ecommerce. Ecommerce is the buying and selling of goods and services over the Internet [2].

American Airlines created a website to provide needed information to their customers, to lower the company's customer service cost, and to sell air tickets as well as to promote special offers including, hotel and car rental companies and preferred seating choices [6]. In order to achieve customer intimacy, American Airlines posted travel-related information such as airport layout and logistics, aircraft seating charts, listing of in-flight movies, city ticket office, and flight arrival and departure times on the website, as most of the customers would prefer to get information they needed directly from web than call in and wait [6]. “When a Business really knows their Customers and serves them well, \'the way they want to be served\', the Customers generally respond by returning and buying more from the firm. It raises revenues and profits [7].” Before the deployment of the website, they spent a million of dollars each year to supply with workers their toll-free customer service telephone systems [6]. In 2001 was documented a million daily visits which was 165% as much as in 2000 [6].

“Customer intimacy means segmenting and targeting markets precisely and then tailoring offerings to match exactly the demands of those niches [8].” American Airlines adopted email strategy that helped increase website conversions by 400% [9]. The company used ads to offer customers a better proposition and to convince them to come back and finish their booking process since they showed their interest on their original visit [9]. In the same time, American Airlines triggered to utilize social media as a comprehensive customer service channel in order to learn the customer experience and to resolve issues in real-time communication, therefore, in 2013 Twitter and Facebook became 24/7 customer service channels [10].

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