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The Impact Of Internet Travelling Agencies In Malaysia Tourism Essay

The impact of the Internet on travel agencies by Rob Law, Faculty Member in the School of Hotel and Tourism Management, The Hong Kong Polytechnic University, Hung Hom, Kowloon, Hong Kong , 16 Number: 2 Year: 2004 pp: 100-107

Through the years the technology in the Travel & Tourism industry has changed for the better and for the worse of the industry, there are various different developments in the industry that have helped it grow significantly over the years.

A key development was introduced in the 60s that significantly helped the growth of the industry, it was booking systems. Now customers would be able to phone in to book their holidays. This did not have the biggest impact but it was more what it led to that had the impact, this was the birth of Global Distribution Systems and Computer Reservation Systems, these allowed Travel Agents to book into a global system to check for flight, at first this was used for airlines but eventually led to the Travel Agents and was used as a sales channel. One of the main CRS was called Galileo; it was founded in 1971 by United Airlines, and this company got bigger and bigger through the years, in 2002 this company had a 26.4% share of the worldwide CRS airline bookings.

The next development was teletext and ceefax, when this was introduced it allowed people to access teletext or ceefax via their televisions in their own homes to browse all the

Probably the biggest impact on the Travel & Tourism industry was the introduction and growth of the internet. With the internet now available it meant that Travel Agents, Tour operators etc could all have their own websites for the customer to view, they could also put their site on the search engines to bring in more business. It also now means that everyone can sit at home (providing they have a computer and internet access) and browse the search engines, or type in a site they know to try and find the holiday of their choice (Poon ,2001)

. The internet also gives people more options, for example they might want to research on a particular destination, or read reviews about a place / site / attraction etc. The internet does allow people to browse, book, research in their own homes, also generally speaking the internet is cheaper than Travel Agents, however there are a few negatives to consider like for example someone might not be aware of the difference between a secure and insecure site meaning that they could put their credit details onto the internet not knowing where they can end up. Also researching and trying to find the right holiday can take a long time when you could just pop down to a travel agency and they could sort it out a lot quicker for you. Finally not that it effects the customer but it does with the industry, is the fact that the internet has taken a lot of the business away from the travel agencies forcing a few to close down (Law & Wong,2003).

In newly industrializing countries (NICs), such as Thailand, where between 1985 and 1995, economic growth rates were 6-9% a year, they were able to raise large sums of capital to invest in tourism development. This had a great effect on tourism growth in South East Asia, where tourist accommodation increased by 50% and in Thailand alone, international arrivals increased from 5 million to 7.5 million between 1991 and 1995. This increase in secondary resources, such as hotels and shops also encourages growth in tourism.

However, it is not always the case that economic development leads to growth in the tourism industry. For example, in many LEDCs, governments seeking economic development have understandably realised the attractiveness of their resources for tourism, such as beaches, warm climates, mountains and exotic cultures and their potential for income, jobs and development. For example, in 1991, the Malaysian government, who are directly involved in tourism development, declared that year a Year of Tourism to encourage travel. Therefore, many government policies for economic growth have turned to tourism promotion. This is also a major cause in the growth of the tourism industry over recent years, which in 1965 had 110 million tourists, but by 1993, the tourism industry had undergone a five-fold increase and there were 510 million tourists worldwide.

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One hundred years ago, a person would be lucky to receive one day for a summer holiday. At present, holidays within the EU are a law, with all full-time workers guaranteed an annual minimum of four weeks paid holiday (by 1995, 90% of workers in the UK received this entitlement). As the length of the working week has been progressively shortened and paid holidays have increased, wages and salaries have been maintained. These benefits, as well as the fact that prices are comparatively cheaper than ever before, especially in terms of air-fares and package holidays, mean that people have greater leisure time and greater disposable income, which can be spent on luxuries such as holidays to exotic locations. For example, in 2004, tourism in Guatemala grew by 34%. In addition, since the Second World War, the number of women in employment has increased tremendously (40% of the worlds 2.8 billion workers are women), meaning family incomes have increased, making foreign holidays more affordable. As the ageing population is increasing, and more people are receiving substantial pensions, this age group (60+ years) too have more money and more time to go on holiday.

Research Question

1 What is the impact of Internet usage in Malaysia among Travel agents and tour Operators?

2 What is the attitude of Travel agents towards the online purchase behaviour in Malaysia ?

3 What is the Perception of the travel agencies towards internet marketing in Malaysia?

Research Objective

1. To investigate the current state of Impact of Internet usage in Malaysia among Travel agents and tour Operators

2. The attitude of Travel agents towards Online purchase behaviour in Malaysia

3. The perception of Internet marketing among travel agencies in Malaysia

The Problem Statement

The internet has become one of the famous channels of distribution in many business fields and it has totally changed the way of doing things in all the business industries and one among them is the Travel industry where the job description of the tour agents and other travel agents are changing comparatively and the travel organisations are being given new roles in their channel of distribution (Law et al., 2004; Nysveen and Lexhagen, 2001; Park, 2000). Many travel agents may have a viewpoint that using internet for ticketing and other travel related queries the basic knowledge is more than enough which is not the actual case there is a very deep approach of using this internet technology compared to the traditional method so travelling related activities , where there are many new offerings and other value added services which have to be focussed upon which is what many travel agents lack these days when making use of this great technology into their organisations.

Significance of the Study

There has been a lot of research on this subject previously where the researchers have laid tremendous emphasis on the importance of internet in the travel and tourism industry. For many of the tourism suppliers the Internet acts as a platform to sell their products to the Global market rather than tart getting the local market which has led to the development of E travellers and the purchase of travel services online which in itself is a significance. The evolution of Internet technology has changed the traditional travelling methods and the services offered by the travel companies which has to be studied and how the internet has changed the traditional methods on the travel industry.

The tourism industry can be separated into two different categories. These are international tourism, where a tourist travels abroad or overseas and internal tourism, where a tourists travel and spending are confined to their country of residence. Although internal tourism accounts for as much as four times the amount of international tourism, the reasons for their overall growth are very similar. As countries become industrialised and urbanised, standards of living increase. The world-wide phenomenon of tourism therefore began in MEDCs, in Europe and North America and later in Japan. To this day, 80% of all tourists come from MEDCs and Europe alone accounts for 48% of expenditure in the tourism industry. The links between economic development and growth in tourism can be related to Rostovs model of economic development. Malaysia is well known all over the world for its tourism and with the advent of many budget airlines like Air Asia it has become more easier for people to think about travelling abroad. This in itself is a significance e of the study and there are many developments and this helps in improving countries economy especially for a country like Malaysia.

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Research framework

This research model has been adopted from Tourism agents attitudes on Internet Adoption : An analysis from Greece Vol. 18 No. 7, 2006 pp. 601-608 from International Journal of Contemporary Hospitality


1. H1. Online purchase behaviour has a positive influence on usage of Internet in travel industry

2. H2. Disintermediation View has a positive influence on usage of Internet in travel industry

3. H3. Disintermediation View with online purchase experience has a positive influence on usage of Internet in travel industry

Study design

The research study will be based on qualitative approaches are deemed appropriate to the initial exploratory stages of research of the nature and content of what is said (Jacnkowicz, 2002). Effectively, it produces findings in the events that involve people and places and is fundamentally suited to destine the meaning of assumptions and perceptions (Amaratunga et al 2002). In terms of choosing the most appropriate data collection method, the researcher recognises that there are different approaches to collecting data from an interpretive stance namely: critical incident technique, projective technique, and mainly a survey questionnaire (Collis and Hussey, 2003; Saunders et al., 2007). The travel agencies in and around Kuala Lumpur and the employees working in the field of Travel related organisations.

The research instrument which will be used for this research is a based on the model has been adapted from The impact of the Internet on travel agencies by Rob Law, Faculty Member in the School of Hotel and Tourism Management, The Hong Kong Polytechnic University, Hung Hom, Kowloon, Hong Kong , 16 Number: 2 Year: 2004 pp: 100-107

Ethical Issues

The information to be collected for this research would be very sensitive and all the policies such as the anonymity of the researcher will be taken care as per the research methods and the data collection will be done in all the legal methods.

Propose chapters of research

1. Chapter 1 (Introduction)

2. Chapter 2 (Literature review)

3. Chapter 3 (Methodology)

4. Chapter 4 (Data collection, data analysis)

5. Chapter 5 (Recommendation, conclusion)


The research study will be limited to only in travel related organisations in Kuala Lumpur Malaysia

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