It makes business sense to be more responsible. My report to the United Nations Environment Programme identified a range of reasons outlined below and here expanded.
Most of these benefits are only achieved through time and a change in company values; those that look for quick fixes because of pressure to be seen to be green chance being publicly criticised for greenwashing. There are also many companies working more responsibly butgreenhushing, i.e. not publicly speaking about it because of fears of being criticised.
My work with industry, associations and destinations looks at:
• How can ALL TYPES of tourism companies develop more sustainable products as market opportunities.
• How can firms use their responsible tourism practices for marketing advantages.
Revenue growth: Being seen to be sustainable can help increase income by securing the loyalty of current customers and attracting new ones, resulting in increased market share. Companies can change their current products to increase quality by being more sustainable, add new product lines to extend stay or expenditure or diversify the product choice to keep customers and promote repeat business. The market accepts paying more for sustainable produce if they meet the key quality, location and convenience attributes. The temptation of tapping into the green market however has led to many mistakes and jumping in the bandwagon without proper expert advice will undoubtedly do you more harm than good.
Cost savings: Sustainability actions can help lower operating costs and improve overall productivity and efficiency by reducing resource use, decreasing waste output and avoiding non-compliance fines. Energy and transport prices will go up, so will food and most supplies. Sustainable supply chain management, lean production and efficient engineering are needed to reduce costs wherever possible. There is now sufficient expertise available to reduce key operating costs by up to 30% on a typical business.
Access to capital: As environmental and social criteria are becoming a standard part of lending risk assessments, sustainable tour operators are more likely to be able to attract capital from banks and investors. Large businesses will need to show corporate social reports that go beyond public relations glossy adverts for their customer’s charitable donations though. Small firms will be seen as less risky to lend to when they have a well worked out business plan that takes into account increasing prices of resources.
Human capital: Staff are more likely to feel proud of working for employers that take their responsibilities to society seriously. Tour operators and hoteliers alike known for their sustainability policies have an increased capacity to attract and retain skilled and talented employees and contract labour, thus increasing their ability to innovate and compete. BUT create a CSR policy that your staff laugh at and you are two steps back, take advice on how to engage staff properly and make your CSR work not only believable, but shared. Remember that sustainability problems are HUMAN problems, technically we could solve most of them if we had the understanding and will to do it.
Brand value and reputation: A reputation for being sustainable adds value to a tour operator’s brands and strengthens its market position, making it less vulnerable to short-term market and economic changes. Let’s face it while the market was expanding there was business for everyone but now the fighting gets ugly. Only the best positioned companies will be able to use their CSR work to differentiate their strategy and positioning.
Preservation of destinations: Acting sustainably helps make tourist destinations more pleasant places to visit and live in. Ensuring the long-term quality of the destination also helps guarantee business viability. Building hotels on a return on investment period mentality tells us all we should use them as hubs to sell apartments; in creating new destinations for tour operators it is tempting to lower the standards and to lower prices short term from voluntourism to resort holidays and excursions; destinations can be tempted by volume from large developments and cruises without a mid term year cost-benefit analysis. Shareholders and constituencies will put pressure on managers and politicians for short term gains and appearance of success. The real winners keep an eye on the horizon.
Improved service: Sustainable management makes holiday facilities safer and healthier for employees and visitors, whilst supporting the local community and enhancing their economic well-being increases staff morale, resulting in improved service and thus higher customer satisfaction. Even the market for sea-sand-sun can be improved by providing fun excursions and not the current rip offs. The growing family adventure market and the (few) good voluntourism companies have shown new avenues for innovation. Every sector though must innovate- those that aren’t- beware!
Risk management and license to operate: Tour operators can reduce their legal liability by managing compliance and pre-empting relevant legislation. For instance, the likelihood of losses from damage to their reputation can be reduced by demonstrating a proactive stance towards destination sustainability and product quality, which can be used as defence in any litigation.
Pre-empting government regulations: Governments are increasingly under pressure from NGOs, unions and the general public to regulate the business sector. This pressure increases if bad practices are uncovered. Tour operators that develop their own codes of conduct and produce independently verified performance reports are in a strong position to influence any proposed legislation.
Most companies start their responsible tourism practices because they perceive they have to (everyone is doing it) and because they think a quick coat of paint will reap short term market benefits. This is not the case. Simply copying what others do will land you in more trouble than it’s worth, expert advice is needed as in every other aspect of business.
My concern all along has been also what help is available for small firms that are working responsibly already, but have limited market access. These firms will say there is no market for responsible tourism, but I usually find this is because they do not understand BUSINESS. Being responsible will not bring customers, it is only part of good business management. Whether you have a small B&B or tour operator for lifestyle reasons or because is the only way to make a living where you are, you need to know about running a company first. I prepared this other report for the United Nations Environment Programme for this reason and with my team we continue to work on this.
What is the role of marketing in achieving responsible tourism?
Responsible tourism marketing is the identification, anticipation and satisfaction of customer requirements profitably while meeting the characteristics of responsible tourism outlined in the Cape Town Declaration.
My consultancy works through a traditional marketing plan structure putting the customer at the centre of its process, and acknowledging the importance of satisfying needs and wants through an exchange process. I draw on ICRT’s consultancy, research and case studies to look at ways of making marketing more responsible towards both hosts and guests, using marketing techniques to do well from doing good. I enjoy both running training events and developing marketing-focused business proposals for the public and private sector.
Our research shows that most exemplary responsible tourism firms feel uncomfortable with marketing themselves on that basis, usually undertaking actions for altruistic reasons and without being integrated in a clear business plan, and reluctant to admit they bring commercial or price differentiation benefits, even when the evidence points to the contrary. On the other hand, less green firms that do not necessarily have fully embraced the values of responsible tourism tend to overuse their limited actions in PR style communications. Both types of firms need support, the first in professionalising and integrating responsible tourism more openly as part of their selling proposition, the second in improving their product lines before making claims.
What to read:
VisitEngland (2010) Keep it real: Market and Communicate your Green Credentials, is the report I have prepared to hep small tourism and hospitality firms. www.visitengland.com/keepitreal It has gone down well, and I am finalising the versions for Failte Ireland and also for VisitWales. Could your destination benefit from its own version?
Grant, J. (2007) The Green Marketing Manifesto, Chichester, Wiley & Sons. While it may annoy you at times, this is a very readable and reasonably priced book, to date the only covering this subject.