Information Technology & Tourism

, Volume 16, Issue 4, pp 413–433 | Cite as

In-destination tour products and the disrupted tourism industry: progress and prospects

  • Alex Yang-chan Hsu
  • Brian King
  • Dan Wang
  • Dimitrios Buhalis
Original Research


Established inbound tour operators (ITOs) are being challenged by emerging competitors that have embraced technology-enabled innovations, including aspects that are associated with the collaborative or sharing economy. A variety of suppliers across the supply chain are now able to form a direct connection with customers through platform websites, thereby providing tech-savvy tourists with the capacity to create customized trips. Incumbent ITOs are now competing with emerging entrants that are responsive to customer needs because of their digital expertise. As the various provider categories have become less clear and as barriers to entry have fallen, tour service suppliers must consider the contemporary tourism “ecosystem” when formulating strategies. In the face of declining consumer demand for standardized tour products, there is an urgent need to consider changing tourist habits or tastes when introducing new in-destination options. In exploring the evolving features of the inbound tourism ecosystem, this paper draws upon the recent literature to focus on the distinguishing characteristics of innovative tour service and experiences. It identifies how tour suppliers respond to competitor actions, or embrace these features themselves. The authors adopt a multiple case study approach and assemble evidence from 17 examples of tourism start-ups in Taiwan. The paper concludes with implications for practitioners and suggestions for future research.


Product innovation In-destination tour products Disrupted industry structure 


  1. Abernathy WJ, Clark KB (1985) Innovation: mapping the winds of creative destruction. Res Policy 14:3–22. doi: 10.1016/0048-7333(85)90021-6 CrossRefGoogle Scholar
  2. Accenture Digital (2016) Fjord trends 2016: trends impacting design and innovationGoogle Scholar
  3. Adner R, Kapoor R (2010) Value creation in innovation ecosystems: how the structure of technological interdependence affects firm performance in new technology generations. Strateg Manag J 31:306–333. doi: 10.1002/smj.821 CrossRefGoogle Scholar
  4. Agapito D, Valle P, Mendes J (2014) The sensory dimension of tourist experiences: capturing meaningful sensory-informed themes in Southwest Portugal. Tour Manag 42:224–237. doi: 10.1016/j.tourman.2013.11.011 CrossRefGoogle Scholar
  5. Alstyne MV (2016) How platform businesses are transforming strategy. Harvard Bus RevGoogle Scholar
  6. Amadeus (2015) Future traveller tribes 2030: understanding tomorrow’s travellerGoogle Scholar
  7. Baltzan P (2015) Business driven technology, 6th edn. McGraw-Hill Education, New YorkGoogle Scholar
  8. Barras R (1986) Towards a theory of innovation in services. Res Policy 15:161–173. doi: 10.1016/0048-7333(86)90012-0 CrossRefGoogle Scholar
  9. Bosworth G, Farrell H (2011) Tourism entrepreneurs in Northumberland. Ann Tourism Res 38:1474–1494. doi: 10.1016/j.annals.2011.03.015 CrossRefGoogle Scholar
  10. Brandenburger AM, Nalebuff BJ (1996) Co-opetition. Doubleday, New YorkGoogle Scholar
  11. Buhalis D (1995) The impact of information telecommunications technologies on tourism distribution channels: implications for the small and medium sized tourism enterprises’ strategic management and marketing. University of SurreyGoogle Scholar
  12. Buhalis D, Amaranggana A (2013) Smart tourism destinations. In: Xiang Z, Tussyadiah I (eds) Information and communication technologies in tourism 2014. Springer International Publishing, pp 553–564. doi: 10.1007/978-3-319-03973-2_40
  13. Buhalis D, Licata MC (2002) The future eTourism intermediaries tourism management 23:207–220Google Scholar
  14. Cabiddu F, Lui T-W, Piccoli G (2013) Managing value co-creation in the tourism industry. Ann Tourism Res 42:86–107. doi: 10.1016/j.annals.2013.01.001 CrossRefGoogle Scholar
  15. Carayannis EG, Spillan JE, Ziemnowicz C (2007) Introduction: why Joseph Schumpeter’s creative destruction? Because everything has changed. In: Carayannis EG, Ziemnowicz C (eds) Rediscovering Schumpeter: creative destruction evolving into “Mode 3”. Palgrave Macmillan, HampshireGoogle Scholar
  16. Chathoth PK, Ungson GR, Harrington RJ, Chan ESW (2016) Co-creation and higher order customer engagement in hospitality and tourism services. Int J Contemp Hosp Manag 28:222–245. doi: 10.1108/ijchm-10-2014-0526 CrossRefGoogle Scholar
  17. Chesbrough H (2006) Open innovation: the new imperative for creating and profiting from technology. Harvard Business Press, USAGoogle Scholar
  18. Chesbrough H (2007) Business model innovation: it’s not just about technology anymore. Strateg Leadership 35:12–17. doi: 10.1108/10878570710833714 CrossRefGoogle Scholar
  19. Chesbrough H (2010) Business model innovation: opportunities and barriers. Long Range Plan 43:354–363. doi: 10.1016/j.lrp.2009.07.010 CrossRefGoogle Scholar
  20. Chiles TH, Bluedorn AC, Gupta VK (2007) Beyond creative destruction and entrepreneurial discovery: a radical Austrian approach to entrepreneurship. Org Studies 28:467–493. doi: 10.1177/0170840606067996 CrossRefGoogle Scholar
  21. Christensen CM (1997) The innovator’s dilemma: when new technologies cause great firms to fail. The management of innovation and change series. Harvard Business School Press, BostonGoogle Scholar
  22. Christensen CM, Bower JL (1996) Customer power, strategic investment, and the failure of leading firms. Strateg Manag J 17:197–218CrossRefGoogle Scholar
  23. Christensen CM, Overdorf M (2000) Meeting the challenge of disruptive change (cover story). Harvard Bus Rev 78:66–76Google Scholar
  24. Christensen CM, Johnson MW, Rigby DK (2002) Foundations for growth: how to identify and build disruptive new businesses, vol 43. Massachusetts Institute of Technology, CambridgeGoogle Scholar
  25. Dalonso YS, Lourenço JM, Remoaldo PC, Panosso Netto A (2014) Tourism experience, events and public policies. Ann Tourism Res 46:181–184. doi: 10.1016/j.annals.2014.03.003 CrossRefGoogle Scholar
  26. Dawson A, Hirt M, Scanlan J (2016) The economic essentials of digital strategy. McKinsey QuarterlyGoogle Scholar
  27. Dörry S (2008) Business relations in the design of package tours in a changing environment: the case of tourism from Germany to Jordan. In: Burns P, Novelli M (eds) Tourism and mobilities: local-global connections. CAB International, Oxfordshire, pp 204–218CrossRefGoogle Scholar
  28. Drucker PF (2002) The discipline of innovation. 1985 Harvard Bus Rev 80:95–100, 102, 148Google Scholar
  29. Dwyer L, Edwards D, Mistilis N, Roman C, Scott N (2009) Destination and enterprise management for a tourism future. Tour Manag 30:63–74. doi: 10.1016/j.tourman.2008.04.002 CrossRefGoogle Scholar
  30. Economist The (2015) Disrupting Mr Disrupter. The Economist Newspaper Limited, LondonGoogle Scholar
  31. Euromonitor International (2014) Travel and the sharing economy. Euromonitor InternationalGoogle Scholar
  32. Euromonitor International (2016) Online travel: Consolidation, tour operators’ moves and opportunities for private equity investments. Euromonitor InternationalGoogle Scholar
  33. Evangelista R (2000) Sectoral patterns of technological change in services. Econ Innov New Technol 9:183–222. doi: 10.1080/10438590000000008 CrossRefGoogle Scholar
  34. Fraiberger SP, Sundararajan A (2015) Peer-to-peer rental markets in the sharing economy. NYU Stern School of Business Research Paper. doi:10.2139/ssrn.2574337Google Scholar
  35. Garcia R, Calantone R (2002) A critical look at technological innovation typology and innovativeness terminology: a literature review. Journal of Product Innovation Management 19:110–132. doi: 10.1016/S0737-6782(01)00132-1 CrossRefGoogle Scholar
  36. Gretzel U (2011) Intelligent systems in tourism. Ann Tourism Res 38:757–779. doi: 10.1016/j.annals.2011.04.014 CrossRefGoogle Scholar
  37. Gretzel U, Werthner H, Koo C, Lamsfus C (2015) Conceptual foundations for understanding smart tourism ecosystems. Comput Hum Behav 50:558–563. doi: 10.1016/j.chb.2015.03.043 CrossRefGoogle Scholar
  38. Grissemann US, Stokburger-Sauer NE (2012) Customer co-creation of travel services: the role of company support and customer satisfaction with the co-creation performance. Tour Manag 33:1483–1492. doi: 10.1016/j.tourman.2012.02.002 CrossRefGoogle Scholar
  39. Guttentag D (2013) Airbnb: disruptive innovation and the rise of an informal tourism accommodation sector. Curr Issues Tourism. doi: 10.1080/13683500.2013.827159 Google Scholar
  40. Haxton P (2015) A review of effective policies for tourism growth, vol 2015/01. OECD Tourism Papers. OECD Publishing, ParisGoogle Scholar
  41. Hjalager A-M (2010a) A review of innovation research in tourism. Tour Manag 31:1–12. doi: 10.1016/j.tourman.2009.08.012 CrossRefGoogle Scholar
  42. Hjalager A-M (2010b) Strategy for tourism. Ann Tourism Res 37:1192–1194. doi: 10.1016/j.annals.2010.07.002 CrossRefGoogle Scholar
  43. Hjalager A-M (2015) 100 innovations that transformed tourism. J Travel Res 54:3–21. doi: 10.1177/0047287513516390 CrossRefGoogle Scholar
  44. Holloway JC (2009) Tour operating. In: The business of tourism, 8th edn. Pearson Education UK, EssexGoogle Scholar
  45. IfM (2015) Understanding the customer: new service-based business models. Accessed 8 Jun 2016
  46. Jansen W, Steenbakkers W, Jägers H (2007) New business models for the knowledge economy. Gower Publishing Ltd., HampshireGoogle Scholar
  47. Kask S (2012) Modes of open innovation in service industries and process innovation: a comparative analysis. In: Open innovation in firms and public administrations: technologies for value creation. IGI Global, Hershey, pp 15–36. doi: 10.4018/978-1-61350-341-6.ch002
  48. Kelman I, Burns TR, des Johansson NM (2015) Islander innovation: a research and action agenda on local responses to global issues. J Mar Island Cult 4:34–41. doi: 10.1016/j.imic.2015.04.001 CrossRefGoogle Scholar
  49. Kiessling TS (2004) Entrepreneurship and innovation: Austrian school of economics to Schumpeter to Drucker to now. J Appl Manag Enterp 9:80–91Google Scholar
  50. Kokkranikal J, Morrison A (2011) Community networks and sustainable livelihoods in tourism: the role of entrepreneurial innovation. Tour Plan Dev 8:137–156. doi: 10.1080/21568316.2011.573914 CrossRefGoogle Scholar
  51. Komppula R (2014) The role of individual entrepreneurs in the development of competitiveness for a rural tourism destination—a case study. Tour Manag 40:361–371. doi: 10.1016/j.tourman.2013.07.007 CrossRefGoogle Scholar
  52. Konu H (2015) Developing a forest-based wellbeing tourism product together with customers—an ethnographic approach. Tour Manag 49:1–16. doi: 10.1016/j.tourman.2015.02.006 CrossRefGoogle Scholar
  53. Lambert SC, Davidson RA (2013) Applications of the business model in studies of enterprise success, innovation and classification: an analysis of empirical research from 1996 to. Eur Manag J 31:668–681. doi: 10.1016/j.emj.2012.07.007 CrossRefGoogle Scholar
  54. Latour B (2005) Reassembling the social: an introduction to actor-network-theory. Oxford University Press, New YorkGoogle Scholar
  55. Lusch RF, Vargo SL (2006) Service-dominant logic: reactions, reflections and refinements. Mark Theory 6:281–288. doi: 10.1177/1470593106066781 CrossRefGoogle Scholar
  56. Marston S, Li Z, Bandyopadhyay S, Zhang J, Ghalsasi A (2011) Cloud computing—the business perspective. Decis Support Syst 51:176–189CrossRefGoogle Scholar
  57. Mathisen L (2014) Storytelling and story staging: co-creating value in tourism. UiT The Arctic University of NorwayGoogle Scholar
  58. Mattsson J, Sundbo J, Fussing-Jensen C (2005) Innovation systems in tourism: the roles of attractors and scene-takers. Ind Innov 12:357–381. doi: 10.1080/13662710500195967 CrossRefGoogle Scholar
  59. Mell P, Grance T (2009) The NIST definition of cloud computing National Institute of Standards and Technology 53:50Google Scholar
  60. Miles RE, Snow CC, Meyer AD, Coleman HJJ (1978) Organizational strategy, structure, and process. Acad Manag Rev 3:546–562Google Scholar
  61. Mitchell DW, Bruckner Coles C (2004a) Business model innovation breakthrough moves. J Bus Strateg 25:16–26. doi: 10.1108/02756660410515976 CrossRefGoogle Scholar
  62. Mitchell DW, Bruckner Coles C (2004b) Establishing a continuing business model innovation process. J Bus Strateg 25:39–49. doi: 10.1108/02756660410536991 CrossRefGoogle Scholar
  63. Mitchell D, Coles C (2003) The ultimate competitive advantage of continuing business model innovation. J Bus Strateg 24:15–21. doi: 10.1108/02756660310504924 CrossRefGoogle Scholar
  64. Morrison A (2006) A contextualisation of entrepreneurship. Int J Enterp Behav Res 12:192–209. doi: 10.1108/13552550610679159 CrossRefGoogle Scholar
  65. Mossberg L, Therkelsen A, Huijbens EH, Björk P, Olsson A-K (2011) Storytelling and destination development. Norwegian School of Management, Oslo; Tourism Research Unit, Aalborg University, Denmark; Icelandic Tourism Research Centre, Akureyri; Hanken School of Economics, Vaasa; University West, Trollhättan, SwedenGoogle Scholar
  66. Neuhofer B, Buhalis D, Ladkin A (2015) Smart technologies for personalized experiences: a case study in the hospitality domain. Electron Markets 25:243–254. doi: 10.1007/s12525-015-0182-1 CrossRefGoogle Scholar
  67. Niininen O, Buhalis D, March R (2007) Customer empowerment in tourism through consumer centric marketing (CCM). Qual Market Res 10:265–281. doi: 10.1108/13522750710754308 CrossRefGoogle Scholar
  68. Nybakk E, Hansen E (2008) Entrepreneurial attitude, innovation and performance among Norwegian nature-based tourism enterprises. Forest Policy Econ 10:473–479. doi: 10.1016/j.forpol.2008.04.004 CrossRefGoogle Scholar
  69. O’Cass A, Sok P (2015) An exploratory study into managing value creation in tourism service firms: understanding value creation phases at the intersection of the tourism service firm and their customers. Tourism Manag 51:186–200. doi: 10.1016/j.tourman.2015.05.024 CrossRefGoogle Scholar
  70. Osterwalder A, Pigneur Y (2010) Business model generation: a handbook for visionaries, game changers, and challengers. Wiley, New YorkGoogle Scholar
  71. Pearlson KE, Saunders CS (2009) Strategic management of information systems. Wiley, New YorkGoogle Scholar
  72. Pine BJ, Gilmore JH (1998) Welcome to the experience economy. Harvard Bus Rev 76:97–105Google Scholar
  73. Porter ME (1985) Competitive advantage: creating and sustaining superior performance. Free Press, New YorkGoogle Scholar
  74. Porter ME (1990) The competitive advantage of nations. Harvard Bus Rev 68:73–93Google Scholar
  75. Porter ME, Heppelmann JE (2014) How smart, connected products are transforming competition. Harvard Bus Rev 92:11–64Google Scholar
  76. Porter ME, Kramer MR (2011) Creating shared value. Harvard Bus Rev 89:62–77Google Scholar
  77. Richards L (2009) Handling qualitative data: a practical guide, 2nd edn. SAGE Publications, New YorkGoogle Scholar
  78. Sánchez J, Callarisa L, Rodríguez RM, Moliner MA (2006) Perceived value of the purchase of a tourism product. Tour Manag 27:394–409. doi: 10.1016/j.tourman.2004.11.007 CrossRefGoogle Scholar
  79. Schumpeter JA (1934) The theory of economic development: an inquiry into profits, capital, credit, interest, and the business cycle vol 55. Transaction publishersGoogle Scholar
  80. Seilov GA (2015) Does the adoption of customer and competitor orientations make small hospitality businesses more entrepreneurial? Int J Contemp Hosp Manag 27:71–86. doi: 10.1108/ijchm-12-2013-0547 CrossRefGoogle Scholar
  81. Solvoll S, Alsos GA, Bulanova O (2015) Tourism entrepreneurship—review and future directions. Scand J Hosp Tourism. doi: 10.1080/15022250.2015.1065592 Google Scholar
  82. Sørensen F, Jensen JF (2015) Value creation and knowledge development in tourism experience encounters. Tour Manag 46:336–346. doi: 10.1016/j.tourman.2014.07.009 CrossRefGoogle Scholar
  83. Souto JE (2015) Business model innovation and business concept innovation as the context of incremental innovation and radical innovation. Tour Manag 51:142–155. doi: 10.1016/j.tourman.2015.05.017 CrossRefGoogle Scholar
  84. Sparks B, Bradley G, Jennings G (2011) Consumer value and self-image congruency at different stages of timeshare ownership. Tour Manag 32:1176–1185. doi: 10.1016/j.tourman.2010.10.009 CrossRefGoogle Scholar
  85. Stamboulis Y, Skayannis P (2003) Innovation strategies and technology for experience-based tourism. Tour Manag 24:35–43. doi: 10.1016/S0261-5177(02)00047-X CrossRefGoogle Scholar
  86. Storbacka K, Brodie RJ, Böhmann T, Maglio PP, Nenonen S (2016) Actor engagement as a microfoundation for value co-creation. J Bus Res 69:3008–3017. doi: 10.1016/j.jbusres.2016.02.034 CrossRefGoogle Scholar
  87. Stramaglia A (2014) Tourism: a service sector. In: Gurrieri AR, Lorizio M (eds) Entrepreneurship networks in Italy. Springer International Publishing, Foggia, pp 59–77. doi: 10.1007/978-3-319-03428-7_3
  88. Strobl A, Peters M (2013) Entrepreneurial reputation in destination networks. Ann Tourism Res 40:59–82. doi: 10.1016/j.annals.2012.08.005 CrossRefGoogle Scholar
  89. Sundbo J, Orfila-Sintes F, Sørensen F (2007) The innovative behaviour of tourism firms—comparative studies of Denmark and Spain. Res Policy 36:88–106. doi: 10.1016/j.respol.2006.08.004 CrossRefGoogle Scholar
  90. Taiwan Tourism Bureau (2015) 2015 annual survey report on visitors expenditure and trends in Taiwan. Tourism Bureau, M.O.T.C. Republic of China (Taiwan)Google Scholar
  91. Taskov N, Boskov T, Metodijeski D, Filiposki O (2011) Enterpreneurship in tourism industry lead to business benefits. In: The second international scientific congress, Biennale, pp 429–437Google Scholar
  92. Teece DJ (1986) Profiting from technological innovation: implications for integration, collaboration, licensing and public policy. Res Policy 15:285–305. doi: 10.1016/0048-7333(86)90027-2 CrossRefGoogle Scholar
  93. Temple B, Young A (2004) Qualitative research and translation dilemmas. Qual Res 4:161–178. doi: 10.1177/1468794104044430 CrossRefGoogle Scholar
  94. Thomas R, Shaw G, Page SJ (2011) Understanding small firms in tourism: a perspective on research trends and challenges. Tour Manag 32:963–976. doi: 10.1016/j.tourman.2011.02.003 CrossRefGoogle Scholar
  95. UNWTO (2010) Understanding tourism: basic glossary. In: International recommendations for tourism statistics 2008. United Nations, New YorkGoogle Scholar
  96. Vargo SL, Lusch RF (2004) Evolving to a new dominant logic for marketing. J Mark 68:1–17. doi: 10.2307/30161971 CrossRefGoogle Scholar
  97. Vargo SL, Maglio PP, Akaka MA (2008) On value and value co-creation: a service systems and service logic perspective. Eur Manag J 26:145–152. doi: 10.1016/j.emj.2008.04.003 CrossRefGoogle Scholar
  98. Vernon WR (1959) Usher and Schumpeter on invention, innovation, and technological change. Q J Econ 73:596–606. doi: 10.2307/1884305 CrossRefGoogle Scholar
  99. Wanga JO, Hayombe PO, Onyango M, Agong SG (2014) Co-creating value in ecotourism experiences (tour guides, craft makers and tourists in Dunga beach, Kisumu city). Int J Dev Res 4:2767–2779Google Scholar
  100. Weill P, Vitale M (2001) Place to space: moving to ebusiness models. Harvard Business School Publishing Corporation, BostonGoogle Scholar
  101. Wieland H, Polese F, Vargo SL, Lusch RF (2012) Toward a service (eco)systems perspective on value creation. Int J Service Sci Manag Eng Technol 3:12–25. doi: 10.4018/jssmet.2012070102 CrossRefGoogle Scholar
  102. Xiang Z, Magnini VP, Fesenmaier DR (2015) Information technology and consumer behavior in travel and tourism: insights from travel planning using the internet. J Retail Consum Services 22:244–249. doi: 10.1016/j.jretconser.2014.08.005 CrossRefGoogle Scholar
  103. Yin RK (2014) Case study research: design and methods, 5th edn. Sage Publications Inc, Thousand OaksGoogle Scholar
  104. Zahra SA, Wright M, Abdelgawad SG (2014) Contextualization and the advancement of entrepreneurship research. Int Small Bus J 32:479–500. doi: 10.1177/0266242613519807 CrossRefGoogle Scholar
  105. Zervas G, Proserpio D, Byers J (2015) The rise of the sharing economy: Estimating the impact of airbnb on the hotel industry. Boston U School of Management Research Paper, p 36. doi: 10.2139/ssrn.2366898
  106. Zhang X, Chen R (2008) Examining the mechanism of the value co-creation with customers. Int J Prod Econ 116:242–250. doi: 10.1016/j.ijpe.2008.09.004 CrossRefGoogle Scholar
  107. Zhao W, Ritchie JRB, Echtner CM (2011) Social capital and tourism entrepreneurship. Ann Tour Res 38:1570–1593. doi: 10.1016/j.annals.2011.02.006 CrossRefGoogle Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 2016

Authors and Affiliations

  1. 1.School of Hotel and Tourism ManagementThe Hong Kong Polytechnic UniversityKowloonHong Kong
  2. 2.Department of Tourism and Hospitality, Faculty of ManagementBournemouth UniversityDorsetUK

Personalised recommendations