E-Commerce Business Idea

Introduction

The world of tourism and hospitality has experienced a significant shift in recent years due to increased research and technological development. To ensure that a firm in this industry keeps up with the competition, it is essential to develop new concepts that facilitate the satisfaction of all stakeholders and travelers. This paper proposes the development of an E-commerce business that aims to personalize the travel experience according to personal preferences and tastes.

Question A

E-commerce business idea

The E-commerce business idea in the hospitality and tourism industries used in this study is creating a personalized travel experience network that ensures customers experience their preferred travel experience. The Platform aims to shift the travel experience away from personal preferences, thus revolutionizing how people travel and enjoy their journeys. This Platform empowers travelers to create memorable and unique journey experiences in the comfort of their homes using a website developed for the operation. In recent years, there has been a transformation in the field of hospitality and tourism due to the varying dynamics in the contemporary business world (Buhalis et al., 2019). However, considering the technological advancements over the past decade, there is an opportunity to improve the niche of hospitality and management using the Internet. With the personalized travel experience network, travelers can easily access a vast range of information while planning their travels.

Industry background Information and Service to be launched

The specific services to be launched via the establishment of this Platform include accommodation recommendations to offer travelers various options for accommodation and living in their destinations. The Platform will use the traveler’s profile to understand their preferred lifestyle, thus recommending accommodation sites that align with their desires. In addition, the Platform also provides travelers with a local place experience to give insight into the nature of the environment of their destination. It will act in line with locals and tour guides to understand the destination’s experiences and thus share this with the travelers to ensure it aligns with their preferred experiences. Also, using the travelers’ preferences, the Platform will give personalized itineraries to ensure that the travelers are in charge of planning their entire journey using the travel options available on the Platform.

QUESTION B

Potential Business Opportunity in the Personalized Travel Experience Platform

The personalized travel experience platform has significant business opportunities, such as increased demand and, thus, growth in the market. Cobanoglu (2007) argued that the demand for personalized travel services has increased due to globalization. Thus, a gap exists that must be filled by the travel industry to fully satisfy consumers. Therefore, with growth in travel and demands for personalized travel, there is an opportunity in increased demands of personalized travel experiences online platforms.

In addition, there is an opportunity in this initiative as there is the chance to collaborate with travel partners, thus ensuring the availability of resources to ensure the growth of a personalized travel experience platform. Collaboration in the travel industry increases the credibility of the Platform as a provider of authentic and sustainable experiences.

Another opportunity evident in the personalized travel platform is reaching a vast number of people locally and globally. A study by Cobanoglu (2007) shows that technological advancement in communication is the primary influencer of globalization, and therefore, creating an online platform increases the outreach serving both global and local foreigners via websites and apps.

Also, there is an opportunity for a personalized travel experience through customer loyalty, and retention is assured once the desired travel experience is delivered to the customers. It can retain travelers when they have memorable travel experiences courtesy of the Platform.

Also, there is an opportunity for the Platform in that it has a higher competitive ability than other agencies offering travel services. This is because most travelers would prefer to use the website to personalize their travel instead of dealing with agencies and firms offering these services physically.

Question C

Current Issues Impacting the Business

One common issue affecting the business is the data privacy and security of the platform users. As an online platform, it collects a large amount of data, mainly from the profiles of the users, both related to travel and personal desires. One of the major threats to online businesses and networks is the risk of going against the site’s privacy policies via sharing users’ information with third parties (Kaynama and Black, 2000). Therefore, mishandling users’ information in the personalized travel experience platform is problematic for the business as it may lead to legal actions against the company.

Another area for improvement in the business is quality assurance and the challenges of partnership with the necessary parties. Creating and retaining partnerships with local bodies in tourism and hospitality is a critical process that requires a lot of consideration and effort to make the partnerships work. Partnerships are primarily affected by one of the parties failing to deliver their part of the agreement, which fails the entire project despite one party acting according to their roles (Kaynama and Black, 2000). With problematic partnerships, there is a possibility of poor quality delivery as certain aspects of the business fail the entire project; therefore, maintaining partnerships and assuring consistency in quality is a problem related to this business.

The other problem in this business is the diversity of the destinations, which offers a dynamic environment for travelers. Factors such as global pandemics, political instability, and natural disasters can halt the initiative when most travel recommendation areas are affected by such issues. Therefore, the Platform should be resilient and flexible enough to handle sudden disruptions and offer counter-travel options.

Question D

Costs Involved in Running Online Business

The cost of running an E-commerce business varies depending on the firm’s size and the operation’s technicalities. However, the primary and everyday expenses include website hosting and development, which cost approximately $3000-$10000; a digital marketing fee is also included and ranges from $500-$5000; software and technology may cost up to $5000 annually, and customer services cost $2000 per month (Baršauskas et al., 2008). Other fees, such as legal fees, range between $2000-$5000, thus making the overall cost of online commerce at least $50000 per year.

Budget Requirements

The general budget requirement for the personalized travel experience can be briefly expounded and expressed in percentage form as:

Software Development- 40%

Marketing the business-20%

Security and data protection- 10%

User interface design- 15%

Customer care and help- 10%

Collaborations and Partnerships- 5%

Legal requirements- 5%

Proposed Budget

The proposed budget for this initiative is meant to cover the essential areas that require expenses to ensure a successful launch of the personalized travel experience platform. The most demanding areas are software development, data security, and interface design development; thus, a large part of the total budget is dedicated to covering these areas. Marketing is also adequately financed to acquire more customers and a broader user base, while customer care services and operations are considered to ensure smooth operations in the business. Also, a security fund is meant to help the company navigate specific sudden challenges.

Question E

Information System Requirements to Run Online Business

The information system required for the personalized travel experience platform will comprise a website and a mobile app to offer travelers consistency in accessing the services at any place and time. The website will be the primary Platform for accessing personalized travel experiences. It will feature a friendly interface with ease of operation, thus allowing users to customize their profiles in line with their travel desires. The website’s key features include users’ profiles and registration, where travelers can create their preferences and travel history to aid the system in giving more accurate recommendations for future destinations. In line with the study by Huang and Benyoucef (2015), the website also must have personalized questions that allow the user to fill in their information so that the systems can automatically determine their preferences. More importantly, the personalized travel experiences website will offer itinerary customization options to allow travelers to modify their preferences and destinations. Another key feature of the website will be booking options that allow the user to book their destination online after they finalize their customized settings. The website will feature a chatbot as a customer care representative to assist and resolve issues immediately.

On the other hand, the mobile app is also a supplement to the website and automatically syncs with it, enabling users to access their preferences and itineraries across various devices. The app will also push notifications to inform users about booking confirmations, itinerary updates, and travel-related details. Moreover, the app will feature an offline mode for travelers with limited internet connectivity, ensuring access to saved itineraries and travel information. Also, the app will provide recommendations regarding locations and real-time updates on nearby attractions and activities. Additionally, users will readily share their personalized itineraries and travel experiences with loved ones by integrating social media into the app. This enhances the overall user experience, allowing travelers to stay connected and informed while embarking on their dream adventures.

Suitable Software Requirements for the New Business

One crucial software requirement for the personalized travel experience platform is actual time communication software, allowing users to get messages on time and quickly interact with customer care, thus enhancing the general user experience. Receiving timely messages makes the Platform effective in recommending destinations and also makes it more engaging, thus retaining travelers. Another software requirement for the project is a content management system that allows administrators to add more destinations and update new destinations and services easily. This is important as it ensures the site is updated and thus has current information, thus more options for travelers, which aids in attracting and retaining more travelers using the firm.

Conclusion

In conclusion, the proposed Personalized Travel Experience platform is a concept in the tourism and hospitality industries that aids in keeping up with the competitive environment. By addressing travelers’ individual preferences and desires, the Platform aims to change how people experience their journeys. It focuses on accommodation recommendations, local place experiences, and personalized itineraries, offering travelers a sense of control and personalization in planning their trips. The potential business opportunity is evident in the growing demand for personalized travel services and the opportunity to collaborate with travel partners. However, the Platform must overcome challenges related to data privacy, quality assurance in partnerships, and adaptability to dynamic travel environments. A budget should be efficiently allocated to software development, marketing, customer care, and legal requirements, ensuring the Platform’s success and competitiveness. By integrating real-time communication tools and a user-friendly content management system, the Platform can achieve communication with users and maintain up-to-date travel information, thus managing to attract and retain travelers with an assurance of quality.

References

Baršauskas, P., Šarapovas, T., & Cvilikas, A. (2008). The evaluation of e‐commerce impact on business efficiency. Baltic Journal of Management, 3(1), 71-91. https://www.emerald.com/insight/content/doi/10.1108/17465260810844275/full/html

Buhalis, D., Harwood, T., Bogicevic, V., Viglia, G., Beldona, S., & Hofacker, C. (2019). Technological disruptions in services: lessons from tourism and hospitality. Journal of Service Management, 30(4), 484-506. https://www.emerald.com/insight/content/doi/10.1108/JOSM-12-2018-0398/full/html

Cobanoglu, C., Powley, J. H., Cetinkaya, A. Ş., & Cummings, P. R. (2007). Online travel purchases from third-party travel websites. In Progress in Tourism Marketing (pp. 55-70). Routledge. https://api.taylorfrancis.com/content/chapters/edit/download?identifierName=doi&identifierValue=10.4324/9780080480480-6&type=chapterpdf

Huang, Z., & Benyoucef, M. (2015). User preferences of social features on social commerce websites: An empirical study. Technological Forecasting and Social Change, 95, 57-72. https://www.sciencedirect.com/science/article/pii/S0040162514000973

Kaynama, S. A., & Black, C. I. (2000). A proposal to assess the service quality of online travel agencies: An exploratory study. Journal of professional services marketing, 21(1), 63-88. https://www.tandfonline.com/doi/abs/10.1300/j090v21n01_05