The life-changing experiences are what sets the destination apart from others and somehow the main reason why the destination is to become popular through the stories. Along with the marketing contents, the life-changing experiences are developed through co-creation between local suppliers and creative stakeholders within the open innovation system.
Taking the value proposition and mission statement as the inspirational mantras, along with some reference benchmarks, the product innovation challenge is about leveraging the stakeholder imagination by stimulating contribution permanently, through creative reviews right after the experience and also through product development contests and co-creation workshops.
There has to be a Product Manager in charge of organizing these events and supervising the developed ideas to assess their feasibility and adequacy, and eventually to put them into practice.
Out of the aforementioned events, innovation is constantly encouraged by rewarding well elaborated ideas and customer reviews bringing in ideas on how the experiences could be improved. Furthermore, the proposed experiences are flexible and customizable for every client, hence generating a wider variety of stories and ideas for product development.
Would you consider other strategies to develop life-changing experiences?
One of the main innovations of Destination marketing 3.0 is the development of new product lines which require specific strategies for its creation and sale. The Special Interest experiences have to be developed in cooperation with expert consultants and the Special interest Travel Agents who are to become our Channel Partners at the outset.
They are to target the Special Interest travelers, one of the key targets identified within the profile of Tourists 3.0, characterized by a high educational level and income, high interest and respect for the destination’s culture and environment, as well as a will for contribution to the greater good in many cases. The experiences themselves consist of tourism activities dedicated to specific motivations, such as sports, cultural & educational activities, specific leisure, discovery or adventure activities, etc.
The strategy to decide which experiences to develop in the destination is based on the Mckinsey matrix, to be explained in detail in the Whitepaper “Business Portfolio Strategy”. To explain it briefly, the method consists of the following steps:
- Assess segments & niche attractiveness: demand seasonality, tourist expense, associated marketing costs, necessary investment, etc. (see the complete list in the “External Audit section”) weighing all the factors to elaborate a synthetic index for each segment.
- Assess destination competitiveness for each segment: assess destination compliance with the segment key success factors, evaluate cost and capability of solving competitiveness gaps, and elaborate a synthetic index out of the assessed factors.
- Prioritize segments: draft the McKinsey matrix indicating competitiveness in one axis and attractiveness in the other axis, as a bi-dimensional diagram where the zero point is the minimum value for both. Then place every segment within the diagram according to the values of their synthetic indexes to visualize the segments where the destination may compete successfully and those that are most profitable. Finally, prioritize accordingly.
Would you consider other methods? If so, what method, and why?
To better realize how destination models 3.0 outperform other models in creating value, reducing efforts and marketing efficiently, hereby are compared three destination models:
Cultural destinations: based on cultural or natural resources with several business owners operating independently. In some cases these cooperate in partnership with the government for marketing the destination.
Resort destinations: based usually on natural resources with one owner operating or controlling all business units providing service in the destination, being also responsible for the marketing. All business units are therefore integrated within the resort.
Destinations 3.0: based on either cultural or natural resources with business units belonging to many owners, and operators cooperating with different levels of integration on the management and marketing of the destination.
COMPETITIVENESS & MARKETING: KEY DIFFERENCES BETWEEN THE THREE DESTINATION MODELS
||Typically local cultural experiences
Based upon cultural & natural resources, and locals creativity
Based on standard products, natural and artificial resources
|Life-changing, personalized and imaginative experiences
Based on stakeholders co-creation
||Cultural character and authenticity with heritage protection and hospitality programs
||Lack of character and authenticity (replicated facility style)
|Enhanced authenticity through urban aesthetic harmony and locals’ inclusiveness as experience suppliers
|Service quality control
||Some service suppliers have Quality certifications
Ratings for restaurants and accommodations
|Comprehensive service quality control
Ratings for accommodation service
|Comprehensive and incentivized service quality control
||Dependent upon every service supplier and local service standards
||Fully specified comfort standards, adapted to the needs of tourists
||Only discomforts associated to cultural environment
|Insecurities & risks
||Dependent upon government regulations and control
||Full information and safety controls on critical issues
Safety dependent upon government regulations
||Functional and emotional
||Mostly functional, but also emotional
||Functional, emotional and spiritual
||All kinds of tourists
||All kinds of tourists, but primarily tourists 3.0
||Differentiation or price
||Mission, vision & values
||Sales transactions and satisfaction monitoring
||Sales transactions and satisfaction monitoring
||Experience co-creation, storytelling through communities
||TTOO, TTAA and direct sales
||TTOO, TTAA and direct sales
||Mission driven agents, communities
||Economic prosperity concentrated in local business owners
||Economic prosperity concentrated in the resort owners
||Poverty alleviation, socio-cultural change, environment protection
||Harmonize experience system and quality standards
||Develop unique experiences to compete upon differentiation
||Integrate and associate stakeholders
Foster culture change
Would you consider other destination models to compare performance? And other relevant points to be compared?
As an essential tool for empowering tourists to contribute and participate in the collaborative marketing system, the Mobile Apps 3.0 would enable tourists to write reviews and rate immediately after the experience, vote and participate in content creation contests, make bookings and search for information about the destination.
The Mobile App 3.0 would not only be a supporting tool for the communication between the tourist and the destination, but also a tool to encourage tourists to become co-creators of the destination experience and to engage them in the mission accomplishment. Other functions of the Mobile App could be augmented reality features, geo-localization, video & photo uploading, map download, nearby deal pop-up service, etc.
This is to be developed for DMOs only, to take profit of the investment being supported by many stakeholders, and to offer the tourist a comprehensive service.
What kind of obstacles do you envision to make the Mobile Apps 3.0 an effective tool?
Beyond the content creation contests to be carried out in the virtual collaborative platform, co-creation should be also facilitated and explained through educational workshops, especially for the enthusiast stakeholders. In co-creation workshops, attendants would learn how to cooperate in creating marketing designs for merchandising products, and tourism products based on life-changing experiences.
The marketing design co-creation workshops would be carried out by expert designers who would provide training on the design techniques to facilitate the development of artistic skills among the interested stakeholders. They would also be trained in team working to facilitate cooperation.
The product co-creation workshops would be organized by the Product Managers, who would explain the development process and key success factors for creating life-changing tourist experiences according to the mission of the destination, as explained in the Product development strategy section. This would be mandatory for local service suppliers, who should be mixed with other stakeholders to balance the co-creation process with a similar amount of inside developers and outside developers.
Co-creation workshops should be organized by DMO as a way of promoting product development throughout the destination, with the participation of local DMC. However, this idea could also be developed by DMCs themselves, even individually as long as they can gather enough contributors.
Do you envision other possible contributors or other possible outputs out of the co-creation workshops?
When designing life-changing experiences, these are to be thought of from the view that their life-changing purpose is what makes them unique and more attractive, not just a matter of social responsibility, because the tourists really want to experience the transformation.
There are many stages to follow when designing the life-changing experiences:
- Define constituents, the receivers who benefit from the activity (women, children/youth, elderly, minorities, BoP, tourists, etc.)
- The life-changing effect that the experience intends to create for the tourists (raising awareness about certain issue, opening mind, etc.)
- Try to include storytelling exercises as a part of the experience, as a strategic part to foster the generation of new stories
- The activity through which the experience is delivered
- The necessary resources and preparation to make it successful
- Carry out the feasibility plan of the product
- Get feedback from creative activists after living the experience, on how to improve it.
- Pay attention to insights and inputs delivered through the open innovation system, in the product co-creation contests and on an ongoing basis –reviews, free contributions, etc.-.
There has to be a Product Manager responsible for controlling the adequacy of the ideas being developed, to help improve & refine them, and to invigorate the open innovation system. The Product Manager would also be in charge of selecting and managing channel partners, benchmarking and customer feedback.
Beyond the tourism programs, the Product Manager should also be responsible for developing volunteer programs in cooperation with NGOs, to reinforce the mission driven positioning of the destination and to add human power to accelerate the mission accomplishment.
The co-creation process is to be carried out in a very different way depending on whether we talk about DMC or DMO, as well as depending on their size and budget. For instance, an open innovation system is likely to be suitable only for regional or nationwide DMOs in cooperation with the destination’s DMCs. For minor DMOs or DMCs, co-creation should be developed through workshops.
What kind of life-changing experiences do you envision?
Co-creation is the new approach to product development. Tourists want to personalize the experience according to their own unique needs and desires. Destinations provide a platform experience as of a generic product, which is somehow customizable by tourists, and by observing how they customize their experiences, the platform eventually develops a portfolio of experiences customized to the needs and motivations of various types of tourists, though still flexible.
Product co-creation is developed mainly through the open innovation system, where stakeholders participate motivated by the will to contribute to the mission accomplishment, and also by the will to showcase their creative skills and gain reputation among the community. Marketing 3.0 intends to leverage these motivators to foster co-creation of experiences and continuous improvement in collaboration with the local service suppliers to keep on enhancing the destination’s offered value.
The co-creation takes place in a collaborative platform as part of the open innovation system where locals may offer their experiences and they receive reviews, ratings and advice from destination product managers on how to make it better. To train stakeholders in the co-creation process, special workshops could be organized, where the key factors to successful product development are explained.
To create life-changing experiences, contributors should start by gaining a deep understanding of the mission statement as a basis for discerning what kind of experiences could be suitable. Further, by listening to stories they can understand what kind of experiences create a life-changing impact on the receivers and thus inspire new experiences by leveraging the contributors’ imagination from the open innovation system. The fact that brand enthusiasts are empowered to participate in the co-creation process spurs their commitment and their will for spreading the stories, as they are also willing to let everybody know about their contributions.
What main challenges do you foresee in the co-creation of tourism experiences?
Destination models 3.0 are complex in nature, and so it is the system of activities that need to be coordinated and managed to sustain its competitive advantage and make the destination model develop to the utmost of its potential.
The open innovation system is the central activity that nurtures and sustains the competitive advantage of the business model, from which many kinds of outcomes are expected:
- Business model innovation: revamping the model through constant brainstorming, reflection and discussion about improvements in either of the building blocks to achieve current goals, or to analyze new approaches to pursue the mission, improve profitability, streamline operations and adapt to the ever changing environment, foreseeing in advance the upcoming challenges and opportunities. The collaborative system should empower new leaders to drive new initiatives with the cooperation and support of the other stakeholders. Participation is limited to qualified stakeholders, also considering crowdsourcing initiatives opened to networks of external experts. Training on business model innovation methodologies should be considered to set a common framework for facilitating discussion.
- Co-creation of experiences: opened to all stakeholders, this section should feature vibrant discussions where mainly local entrepreneurs and enthusiast tourists exchange and pre-test ideas on new life-changing experiences to be developed in the destination. There could be contests to stimulate participation of the largest extent of stakeholders.
- Story creation: also opened to all stakeholders, this section could feature story creation contests in many formats such as videos, podcasts, text, to be developed individually or in groups. Participation of bloggers would be encouraged through the organization of blogger trips, especially during the initial stages of the destination’s development. This section requires particular attention from the platform managers, as it is the “content marketing machine” upon which the destination model relies to attract and engage new stakeholders over time.
- Marketing contents and designs: this section could encompass the development of an image bank or several collections of designs, to be eventually used in merchandising or marketing materials. Participation in this section could be stimulated through creation contests or crowdsourcing to professional photographers and designers. For the image bank, key influencers such as the “Instagramers” could be invited to the destination as with bloggers and journalists.
Beyond the platform managers’ initiatives to invigorate the innovation system, individual initiatives should also be eventually rewarded through a pre-determined incentive system. In this regard, platform leaders should orientate the innovation efforts towards the mission driven goals and identified challenges and opportunities in the business model innovation forum.
Beyond giving empowerment, the platform leaders’ role is to inspire others and provide facilitation and support to develop skills such as story creation and storytelling. Further, they should control that the initiatives are well aligned with the mission, prioritizing its accomplishment over other goals, to preserve the integrity of the brand. Such control, in fact, should be carried out by all stakeholders. Platform leaders should deeply assume that empowering stakeholders consists also in sharing power with them.
Do you envision any other interesting output to be obtained from the open innovation system?
The market intelligence studies provide the necessary information for both operators and Destination Management Organizations (DMO) to design their marketing strategies and actions optimally and efficiently. This can be summarized in a series of specific objectives:
Analyze for each new market and segment:
- Market dimension, evolution and perspectives.
- Public types and characterization of their demand: sociological profile, seasonality, length of the trip, types of services demanded, trip organization, advanced booking, motivations, expenditure and price elasticity.
- Purchasing behavior: information sources, decision key factors, etc.
- Possibility of fostering customer loyalty and multiplying effect/fostering prestige
- Quantitative and qualitative trends of both supply and demand.
- Key players, advisors, opinion leaders and other trendsetters.
- Associations, publications, events, fairs, portals, forums, blogs and social networks.
- Key competitiveness factors and requirements.
- Best practices in management and destination competitiveness improvement, marketing, products, business models and technologies.
- Marketing strategies and actions. Minimum investment recommended.
- Tour operators, travel agents and web portals working with this segment. Positioning and market share of every one, segment concentration, entries and exits. Estimated percentage of FITs.
- Segment attractiveness: analysis of the 5 competitive forces and growth potential.
- Analysis of competitiveness/price, distribution and offer variety compared between destinations. Positioning of each destination.
- Knowledge and assessment of the destination by the tour operators and travel agents.
Analyze for each tour operator:
- Turnover and market share (globally and by segments). Volume of tourists per segment and perspectives. Knowledge and assessment of our destination.
- Brochure portfolio, products and destinations for each product.
- Kinds of target audiences and percentage of loyal customers.
- Positioning of the tour operator in the market.
- Kinds of packages offered (length, accommodation, seasonality, etc.)
- Interest in receiving information, participating in fam trips and receiving commercial proposals.
- Programming calendar and contracting strategy.
- Financial data
Analyze for each tour operator currently programming the destination:
- Activities and visits carried out during the trip.
- Effectiveness and profitability of the current marketing actions. Evolution of demand towards our destination along the last 5 years.
- Client share (% of trips to our destination) per product, actual and potential value of the tour operator.
- Explore strategies and actions to increase sales and customer loyalty
- Other destinations offered by the tour operator and compared analysis: positioning, strengths, weaknesses and strategy of every one.
- Perceived positioning of our destination and suggested positioning.
- Destination assessment: strengths, weaknesses, satisfaction and resignation risk.
Analyze the projected image of the destination and brand awareness:
- In the tourism guides and specialized publications
- Articles and reports in the press and TV
- Social media and related web pages
- Tour-operator brochures
Do you miss any specific goal to be considered?
As aforementioned, with Marketing 3.0 there is a shift from vertical to horizontal control, being that the communities of creative activists are those who do the marketing by supporting brands concerned about making positive impacts in their communities. Therefore, the new marketing has the social networks as the main scenario where most brand marketing activities take place.
The communication strategy embraces collaborative channels as its main conveyors of the value proposition, as these are the most trusted ones by the communities of potential stakeholders. Furthermore, the new communication channels have to enable connectivity and interactivity to empower community members to participate at any time –especially when they are enjoying the destination- and share content with the rest of the community. The new wave technology is what allows community members to express their ideas and opinions in collaboration with the rest of the community.
The destination should accommodate the will of tourists to connect with other tourists who want to share their experience and story. Only by helping tourists connect with each other and deliver the promised brand values will the destination gain the crucial support of the communities.
The main marketing contents to be shared throughout the communities are stories. Stories are to convey the Mission, vision and values of the destination brand embodied in the life-changing experiences in a compelling manner drawing the attention of potential tourists and stakeholders.
Compelling stories are the new advertising, and their success is measured by the extent to which these stories are the focus of conversations in the social networks. These stories create loyalty among stakeholders who end up regarding the brand as an icon. Then, these enthusiast stakeholders become brand ambassadors by spreading the stories throughout the social networks. This is the power of storytelling.
To generate stories and other marketing contents, there has to be design of a content marketing system with a strategy to leverage the already existing stories and also to leverage the creativity of the stakeholders to make up new ones, as well as to spread the stories throughout the social media. The open innovation system is the one that leverages all the knowledge and creativity to nurture the content marketing system, and the existing local communities are where we should search for the existing stories to start-up the content marketing system.
What main challenges do you foresee in developing this communication strategy?