UNIT-I

Challenges and Issues in Service Marketing

(i). Tangibility

A product is tangible, which means the customer can touch and see the product before
deciding to make a purchase. Items such as packaging and presentation may compel a
customer to purchase a product. Services, on the other hand, are not tangible, which can
make them more difficult to promote and sell than a product.

(ii). Relationship and Value

Products tend to fill a customer's need or want, so companies can use this to sell a product.
A service is more about selling a relationship and the value of the relationship between the
buyer and seller of the service. For example, a car is something a buyer can touch and see
as well as use. A service, such as lifestyle coaching, for example, is not tangible. A lifestyle
coach may be able to assist clients in creating a life plan and implementing steps to
transform his life into one that the client wants to live, but it is not something tangible that
the client can place in his home and look at every day. Therefore, the client needs to
perceive the value of the service, which can be harder to get across.

(iii). One Versus Many

Marketing products tends to involve multiple products that make up the line. For example,
cleaning product manufacturers tend to market not just one cleaning product. Instead, they
have a line of cleaning products to serve the various needs of their customers. Services, on
the other hand, typically have a single option. It can be harder to promote and sell the
reputation of one single service over the benefits of many different products.

(iv). Comparing Quality

Measuring the quality of a product is easier than measuring that of a service. If a customer
buys a cleaning product to clean the kitchen sink and it doesn‟t do product is zero. On the
other hand, it is harder to measure the quality of a service.

(v). Return Factor

If a customer purchases a product,thecustomerandcan returnit thedoes product for her
money back or at least to receive a store credit. A service is consumed as it is offered, so it
lacks the return factor that a product has. Some service providers overcome this by offering
money-back guarantees.
(vi). Greater importance placed on customer service:
Unsurprisingly, brands themselves are reacting and placing greater importance on the role
and function of customer service within their organisation. It’s shifting from being a
 sideline topic to the heart of many successful brands, who know that it’s important to put
the customer at the heart of customer service.
And in a competitive commercial environment, it’s clear that good customer service can
make all the difference between a happy customer and a potential client who has gone
elsewhere.
(vii). Move towards frequent testing:
Making sure that the customer service channels are operating as they should, is also
unsurprisingly of key importance. There can be nothing more frustrating than dropped
calls, crackly phone lines and unclear processes.
Monitoring flags customer experience issues in real time and enabling companies to react
quickly to any potential fault or problem. As customer service functioning becomes less of
an IT issue and more of a central part of a company’s operation, monitoring and testing is
critical in meeting customer expectations and giving companies the competitive edge.
What is Integrated Marketing Services?
Integrated marketing is a marketing strategy that emphasizes the significance of
coherent, seamless, multi-dimensional brand experience for consumers. This implies that
every attempt of branding – across television, radio, print, the Internet, and in individual –
is presented in a comparable style that reinforces the brand's ultimate message. Integrated
Marketing is becoming increasingly crucial because the fragmentation and exposure of the
media have started to desensitize customers.

Process of Integrated Marketing services:

1. Research:
Our method involves studies on qualitative situational analysis and market trends
measurement.
2. Implementation:
Our expert team strategizes on the best-integrated marketing campaigns.
3. Understanding Consumer:
We research on a client project and technological advancements, brand focus, corporate
culture, and the identity that their brand is trying to express through marketing efforts.

4. Integrated Marketing Plan:

Can be tweaked depending on the audience and situation.
5. Profitability:
Any strategy or idea is successful only when it generates additional revenues for the
organization.
Growth of Services sector in India:
The services sector is not only the dominant sector in India’s GDP, but has also
attracted significant foreign investment, has contributed significantly to export and has
provided large-scale employment. India’s services sector covers a wide variety of activities
such as trade, hotel and restaurants, transport, storage and communication, financing,
 insurance, real estate, business services, community, social and personal services, and
services associated with construction.

1. Market Size
 The services sector is a key driver of India’s economic growth. The sector
contributed 55.39% to India’s Gross Value Added at current price in FY20#. GVA
at basic prices at current prices in the second quarter of 2020-21 is estimated at Rs.
42.80 lakh crore (US$ 580.80 billion), against Rs. 44.66 lakh crore (US$ 633.57
billion) in the second quarter of 2019-20, showing a contraction of 4.2%. According
to RBI, in February 2021, service exports stood at US$ 21.17 billion, while imports
stood at US$ 10.61 billion.
 The India Services Business Activity Index/Nikkei/IHS Markit Services Purchasing
Managers’ Index fell to 54 in April 2021, from 54.6 in March 2021, due to pandemic -
induced constraints in business activities and weakened sentiments towards growth
prospects.
2. Industry developments:
Some of the developments in the services sector in the recent past are as follows:
 The services category in India attracted cumulative foreign direct investment (FDI)
worth US$ 85.86 billion between April 2000 and December 2020. The services
category ranked 1st in FDI inflow as per data released by the Department for
Promotion of Industry and Internal Trade (DPIIT).
 In April 2021, the Ministry of Education (MoE) and University Grants Commission
(UGC) started a series of online interactions with stakeholders to streamline forms
and processes to reduce compliance burden in the higher education sector, as a
follow-up to the government’s focus on ease of doing business to enable ease of
living for stakeholders.
 On March 17, 2021, the Health Ministry’s eSanjeevani telemedicine services crossed
3 million (30 lakh) teleconsultations since its launch, enabling patient -to-doctor
consultations from the confines of their home and doctor -to-doctor consultations.
 In April 2021, Elon Musk’s SpaceX has started accepting pre -orders for the beta
version of its Starlink satellite internet service in India for a fully refundable deposit
of US$ 99. Currently, the Department of Telecommunications (DoT) is screening the
move and more developments will be unveiled soon.
 In December 2020, a cohort of six health-tech start-ups—AarogyaAI, BrainSightAI,
Fluid AI, InMed Prognostics, Wellthy Therapeutics, and Onward Assist—have been
selected by the India Edison Accelerator, fuelled by GE Healthcare. India Edison
Accelerator, the company’s first start-up partnership programme focused on Indian
mentors, creates strategic partners to co-develop healthcare solutions.
 The Indian healthcare industry is expected to shift digitally enabled remote
consultations via teleconsultation. The telemedicine market in India is expected to
increase at a CAGR of 31% from 2020 to 2025.
 In December 2020, Gamma Skills Automation Training introduced a unique robotics
& automation career launch programme for engineers, an ‘Industry 4.0 Hands -on
Skill Learning Centre’ located at IMT Manesar, Gurgaon in Haryana.
 In December 2020, the ‘IGnITE’ programme was initiated by Siemens, BMZ and
MSDE to encourage high-quality training and technical education. ‘IGnITE’ aims to
develop highly trained technicians, with an emphasis on getting them ready for the
industry and future, based on the German Dual Vocational Educational Training
(DVET) model. By 2024, this programme aims to upskill ~40,000 employees.
 In October 2020, Bharti Airtel entered cloud communications market with the launch
of business-centric ‘Airtel IQ’.

3. Government Initiatives:
The Government of India recognises the importance of promoting growth in services sector
and provides several incentives across a wide variety of sectors like health care, tourism,
education, engineering, communications, transportation, information technology, banking,
finance and management among others.
The Government of India has adopted few initiatives in the recent past, some of these
are as follows:
 Under Union Budget 2021-22, the government allocated Rs. 7,000 crore (US$ 963.97
million) to the BharatNet programme to boost digital connectivity across India.
 FDI limit for insurance companies has been raised from 49% to 74% and 100% for
insurance intermediates.
 In May 2021, the Ministry of Commerce and Industry announced that India received
an FDI inflow of US$ 81.72 billion, the highest FDI during FY 2020 -21.
 In March 2021, the central government infused Rs. 14,500 crore (US$ 1.99 billion)
capital in Central Bank of India, Indian Overseas Bank, Bank of India and UCO
Bank through non-interest-bearing bonds.
 On January 15, 2021, the third phase of Pradhan Mantri Kaushal Vi kas Yojana
(PMKVY) was launched in 600 districts with 300+ skill courses. Spearheaded by the
Ministry of Skill Development and Entrepreneurship, the third phase will focus on
new-age and COVID-related skills. PMKVY 3.0 aims to train eight lakh candidates.
 In January 2021, the Department of Telecom, Government of India, signed an MoU
with the Ministry of Communications, Government of Japan, to strengthen
cooperation in the areas of 5G technologies, telecom security and submarine optical
fibre cable system.
 On November 4, 2020, the Union Cabinet, chaired by the Prime Minister, Mr.
Narendra Modi, approved to sign a memorandum of understanding (MoU) between
the Ministry of Communication and Information Technology and the Department of
Digital, Culture, Media and Sports (DCMS) of United Kingdom Government to
cooperate in the field of telecommunications/information and communication
technologies (ICTs).
 In October 2020, the government selected Hughes Communications India to connect
5,000 village panchayats in border and naxal-affected states and island territories
with satellite broadband under BharatNet project by March 2021.
 In September 2020, the government announced that it may infuse Rs. 200 billion
(US$ 2.72 billion) in public sector banks through recapitalisa tion of bonds
 In the next five years, the Ministry of Electronics and Information Technology is
working to increase the contribution of the digital economy to 20% of GDP. The
government is working to build cloud-based infrastructure for collaborative
networks that can be used for the creation of innovative solutions by AI
entrepreneurs and startups.
 On Independence Day 2020, Prime Minister Mr. Narendra Modi announced the
National Digital Health Mission (NDHM) to provide a unique health ID to every
Indian and revolutionise the healthcare industry by making it easily accessible to
everyone in the country. The policy draft is under ‘public consultation’ until
September 21, 2020.
 In September 2020, the Government of Tamil Nadu announced a new electronics &
hardware manufacturing policy aligned with the old policy to increase the state’s
electronics output to US$ 100 billion by 2025. Under the policy, it aims to meet the
requirement for incremental human resource by upskilling and training >100,000
people by 2024.
 Government of India has launched the National Broadband Mission with an aim to
provide Broadband access to all villages by 2022.

4. Road Ahead:
 By 2023, healthcare industry is expected to reach US$ 132 billion. India’s digital
economy is estimated to reach US$ 1 trillion by 2025. By end of 2023, India’s IT
and business services sector is expected to reach US$ 14.3 billion with 8% growth.
 The implementation of the Goods and Services Tax (GST) has created a common
national market and reduced the overall tax burden on goods. It is expected to reduce
costs in the long run-on account of availability of GST input credit, which will result
in the reduction in prices of services.
 UNIT-II

DEFINITION OF BANKING
The Banking Regulations Act 1949, Sec.5 (b) defines the term banking as “Banking means
accepting, for lending or investment, of deposits of money from the public repayable on
demand or otherwise and withdraw by cheque, draft, and order or otherwise.”
Sec.5(c) of the BR Act defines a “banking company” as a company that transacts the
business of banking in India. Since a banker or a banking company undertakes banking-
related activities we can derive the meaning of banker or a banking company from Sec 5(b)
as a body corporate that:
(a) Accepts deposits from the public.
(d) Allows withdrawals of deposits on-demand or by any other means.
Accepting deposits from the ‘public’ means that a bank accepts deposits from anyone who
offers money for the purpose. Unless a person has an account with the bank, it does not
accept the deposit. For depositing or borrowing money there has to be an account
relationship with the bank. A bank can refuse to open an account for undesirable persons.
It is the bank’s right to open an account. Reserve Bank of India has stipulated certain norms
“Know Your Customer” (KYC) guidelines for opening accounts and banks have to strictly
follow them. In addition to the activities mentioned in Sec.5 (b) of the B R Act, banks can
also carry out activities mentioned in Sec. 6 of the Act.
DEFINITION OF CUSTOMER
The term Customer has not been defined by any act. In simple words, a customer is such a
person to whom you extend your services in return for consideration. A customer is a
person who maintains an account with the bank without taking into consideration the
duration and frequency of operation of his account. To be a customer for any bank the
individual should have an account with the bank. The individual should deal with the bank
in its nature of regular banking business.
Those who do not maintain any account relationship with the bank but frequently visit a
branch of a bank to availing banking facilities such as for purchasing a draft, en-cashing a
cheque, etc. Technically they are not customers, as they do not maintain an account with
the bank branch. The term ‘customer’ is used only concerning the branch, where the
account is maintained. He cannot be treated as a ‘customer’ for other branches of the same
bank. However with the implementation of’ ‘Core Banking Solution’ the customer is the
customer of the bank and not of a particular branch as he can operate his account from any
branch of the bank and from anywhere. In the event of arising any cause of action, the
customer is required to approach the branch with which it had opened an account and not
with any other branch.
As per ‘Know Your Customer’ guidelines issued by Reserve Bank of India, customer
has been defined as:
1. A person or entity that maintains an account and/or has a business relationship with
the bank;
2. One on whose behalf the account is maintained (i.e. the beneficial owner);
3. Beneficiaries of transactions conducted by professional intermediaries, such as Stock
Brokers, Chartered Accountants, Solicitors, etc. as permitted under the law, and
4. Any person or entity connected with a financial transaction, which can pose significant
reputation or other risks to the bank, say, a wire transfer or issue of a high-value demand
draft as a single transaction.
BANKER CUSTOMER RELATIONSHIP
It means that to become a customer account relationship is a must. Account relationship is
a contractual relationship. Banking is a trust-based relationship. There are numerous kinds
of relationships between the bank and the customer. The relationship between a banker and
a customer depends on the type of transaction. Thus the relationship is based on contract,
and certain terms and conditions.
These relationships confer certain rights and obligations both on the part of the banker and
on the customer. However, the personal relationship between the bank and its customers is
long-lasting. Some banks even say that they have a generation-to-generation banking
relationship with their customers.
CLASSIFICATION OF RELATIONSHIP
The relationship between banker and customer is of utmost importance. The relationship
between a bank and its customers can be broadly categorized into General relationships
and Special relationships.
A. GENERAL RELATIONSHIP
If we look at Sec 5(b) of the Banking Regulation Act, we would notice that the bank’s
business is accepting deposits for lending. Thus, the relationship arising out of these two
main activities is known as General Relationship.
1. DEBTOR AND CREDITOR
When a ‘customer’ opens an account with a bank, he fills in and signs the account opening
form. By signing the form he agrees/contracts with the bank. When a customer deposits
money in his account the bank becomes a debtor of the customer and the customer a
creditor. The money so deposited by the customer becomes the bank’s property and the
bank has a right to use the money as it likes. The bank is not bound to inform the depositor
of the manner of utilization of funds deposited by him. Bank does not give any security to
the depositor i.e. debtor. The bank has borrowed money and it is only when the depositor
demands, the banker pays. Bank’s position is quite different from normal debtors.
While issuing Demand Draft, Mail / Telegraphic Transfer, the bank becomes a debtor as it
owns money to the payee/ beneficiary.
2. CREDITOR AND DEBTOR
Lending money is the most important activity of a bank. The resources mobilized by banks
are utilized for lending operations. Customer who borrows money from the bank own
money to the bank. In the case of any loan/advances account, the banker is the creditor and
the customer is the debtor. The relationship is the first case when a person deposits money
with the bank reverses when he borrows money from the bank. Borrower executes
documents and offers security to the bank before utilizing the credit facility.
B. SPECIAL RELATIONSHIP
In addition to these two activities banks also undertake other activities mentioned in Sec.6
of the Banking Regulation Act. In addition to opening a deposit/loan account banks
provide a variety of services, which makes the relationship more wide and complex.
Depending upon the type of services rendered and the nature of the transaction, the banker
acts as a bailee, trustee, principal, agent, lessor, custodian, etc.
1. TRUSTEE AND BENEFICIARY (BANK AS A TRUSTEE AND
CUSTOMER AS A BENEFICIARY):
As per Sec. 3of Indian Trust Act 1882, a “trust” is an obligation annexed to the ownership
of property, and arising out of a confidence reposed in and accepted by the owner, or
declared and accepted by him, for the benefit of another, or of another and the owner. Thus,
the trustee is the holder of property on behalf of a beneficiary.
In the case of a trust, a banker customer relationship is a special contract. When a person
entrusts valuable items to another person with the intention that such items would be
returned on demand to the keeper the relationship becomes of a trustee and trustier.
Customers keep certain valuables or securities with the bank for safekeeping or deposits
certain money for a specific purpose (Escrow accounts) the banker in such cases acts as a
trustee. Banks charge fees for safekeeping valuables.
2. BAILEE AND BAILOR (BANK-BAILEE AND CUSTOMER- BAILOR):
Sec.148 of Indian Contract Act, 1872, defines “Bailment” “bailor” and “bailee”. A
“bailment” is the delivery of goods by one person to another for some purpose, upon a
contract that they shall, when the purpose is accomplished, be returned or otherwise
disposed of according to the directions of the person delivering them. The person
delivering the goods is called the “bailor”. The person to whom they are delivered is called,
the “bailee”.
Banks secure their advances by obtaining tangible securities. In some cases, physical
possession of securities goods (Pledge), valuables, bonds, etc., are taken. While taking
physical possession of securities the bank becomes bailee and the customer bailor. Banks
also keep articles, valuables, securities, etc., of their customers in Safe Custody and act as
a Bailee. As a bailee, the bank is required to take care of the goods bailed.
3. LESSOR AND LESSEE (BANK- LESSOR AND CUSTOMER- LESSEE):
Sec.105 of ‘Transfer of Property Act 1882’ defines lease, Lessor, lessee, premium, and
rent. As per the section “A lease of immovable property is a transfer of a right to enjoy
such property, made for a certain time, express or implied, or in perpetuity, in consideration
of a price paid or promised, or of money, a share of crops, service or any other thing of
value, to be rendered periodically or on specified occasions to the transferor by the
transferee, who accepts the transfer on such terms.”
Definition of Lessor, lessee, premium, and rent:
(1) The transferor is called the lessor,
(2) The transferee is called the lessee,
(3) The price is called the premium, and
(4) The money, share, service, or another thing to be so rendered is called the rent.
Providing safe deposit lockers is an ancillary service provided by banks to customers.
While providing a Safe Deposit Vault/locker facility to their customers’ the bank agrees
with the customer. The agreement is known as the “Memorandum of letting” and attracts
stamp duty.
The relationship between the bank and the customer is that of the lessor and lessee. Banks
lease (hire lockers to their customers) their immovable property to the customer and give
them the right to enjoy such property during the specified period i.e. during the office/
banking hours and charge rentals. Bank has the right to break open the locker in case the
locker holder defaults in payment of rent. Banks do not assume any liability or
responsibility in case of any damage to the contents kept in the locker. Banks do not insure
the contents kept in the lockers by customers.
4. AGENT AND PRINCIPAL (BANK- AGENT AND CUSTOMER-
PRINCIPAL):
Sec. 182 of ‘The Indian Contract Act, 1872’ defines “an agent” as a person employed to
do any act for another or to represent another in dealings with third persons. The person
for whom such act is done or who is so represented is called “the Principal”.
Thus an agent is a person, who acts for and on behalf of the principal and under the latter’s
express or implied authority, and the acts that were done within such authority are binding
on his principal and, the principal is liable to the party for the acts of the agent.
Banks collect cheques, bills, and makes payment to various authorities’ viz., rent, telephone
bills, insurance premium, etc., on behalf of customers. . Banks also abides by the standing
instructions given by their customers. In all such cases bank acts as an agent of its customer,
and charges for these services. As per the Indian contract, the Act agent is entitled to
charges. No charges are levied in the collection of local cheques through the clearing house.
Charges are levied only when the cheque is returned to the clearinghouse.
5. INDEMNITY HOLDER AND INDEMNIFIER (BANK-INDEMNITY
HOLDER AND CUSTOMER-INDEMNIFIER):
The dictionary meaning of the word Indemnity means ‘security or protection against a loss
or other financial burden’. As per Section 124 of the Indian Contract Act 1872, the
definition of Indemnity is as follows. ‘A contract by which one party promises to save the
other from loss caused to him by the contract of the promisor himself, or by the conduct of
any other person, is called a “contract of indemnity”. The right of indemnity-holder is
defined in Section 124 of the Indian Contract Act 1872. An indemnity is an obligation by
a person to provide compensation for a particular loss suffered by another person. In the
case of banking, the relationship happens in transactions of issue duplicate demand draft,
TDR, deceased account payment, etc. In that case, the indemnifier will compensate any
loss arising from the wrong or excess payment. In these cases, the bank is an Indemnity
Holder (Promisee) and the customer is Indemnifier (Promisor).
6. HYPOTHECATOR AND HYPOTHECATEE (BANK- HYPOTHECATEE
AND CUSTOMER- HYPOTHECATOR):
The relationship between customer and banker can be that of Hypothecator and
Hypothecatee. This happens when the customer hypothecates certain movable or non-
movable property or assets with the banker to get a loan. In this case, the customer became
the Hypothecator, and the Banker became the Hypothecatee.
7. PLEDGER AND PLEDGEE (BANK- PLEDGEE OR PAWNEE AND
CUSTOMER- PLEDGER OR PAWNOR):
The relationship between customer and banker can be that of Pledger and Pledgee. This
happens when the customer pledges (promises) certain assets or security with the bank to
get a loan. In this case, the customer becomes the Pledger or Pawnor, and the bank becomes
the Pledgee or Pawnee. Under this agreement, the assets or security will remain with the
bank until a customer repays the loan.
8. MORTGAGOR AND MORTGAGEE (BANK- MORTGAGEE AND
CUSTOMER- MORTGAGOR):
As per section 58 of Transfer of Property Act 1882, the mortgage is the transfer of an
interest in specific immovable property to secure the payment of money advanced or to be
advanced by way of loan, an existing or future debt, or the performance of an engagement
which may give rise to a pecuniary liability. The mortgagor only pats with the interest in
the property and not the ownership. The transferor of interest in the property is called a
mortgagor and the transferee is called a mortgagee. In this case, the customer became the
Mortgagor, and the Banker became the Mortgagee.
9. AS A CUSTODIAN:
A custodian is a person who acts as a caretaker of something. Banks take legal
responsibility for a customer’s securities. While opening a D-Mat account bank becomes a
custodian.
10. AS A GUARANTOR:
Banks give guarantees on behalf of their customers and enter into their shoes. A guarantee
is a contingent contract. As per sec 31, of Indian contract Act guarantee is a “contingent
contract”. A contingent contract is a contract to do or not to do something, if some event,
collateral to such contract, does or does not happen.
11. ADVISOR AND CLIENT (BANK- ADVISOR AND CUSTOMER-
CLIENT):
When a customer invests in securities, the banker acts as an advisor. The advice can be
given officially or unofficially. While giving advice the banker has to take maximum care
and caution. Here, the banker is an Advisor, and the customer is a Client.

Customer Services:
 The Regulations That Govern Banking in India
The banking system in India is regulated by the Reserve Bank of India (RBI), through the
provisions of the Banking Regulation Act, 1949.1
Some important aspects of the regulations that govern banking in this country, as well as
RBI circulars that relate to banking in India, are explored below.
 India's banking system is regulated by the RBI and the Banking Regulation Act, 1949.
 Bank lending to single and group borrowers is limited to 15% and 30% respectively, with
some exceptions.
 Sectors given lending priority are micro and small enterprises; agriculture, education, and
housing; and the low-earning and less privileged.
 Those who willfully default on loans may be criminally prosecuted.
 India's banking regulations underscore the country's preference for financial stability and
economic inclusiveness.
1. Exposure Limits:
Lending to a single borrower is limited to 15% of the bank’s capital funds (tier 1 and tier
2 capital). This limit may be extended to 20% in the case of infrastructure projects.
Lending to group borrowers is limited to 30% of the bank’s capital funds, with an option
to extend it to 40% for infrastructure projects. The lending limits can be extended by a
further 5% with the approval of the bank's board of directors. Lending includes both fund-
based and non-fund-based exposure.
2.Cash Reserve Ratio and Statutory Liquidity Ratio:
Cash Reserve Ratio (CRR):
 Banks in India are required to keep a minimum of 4.5% of their net demand and time
liabilities (NDTL) in the form of cash with the RBI. These deposits currently earn no
interest.
The CRR needs to be maintained on a fortnightly basis, while the daily maintenance needs
to be at least 95% of the required reserves.
In case of default on daily maintenance, the penalty is 3% above the bank rate applied on
the number of days of default multiplied by the amount by which the amount falls short
of the prescribed level.
Statutory Liquidity Ratio (SLR):
Over and above the CRR, a minimum of 22% and a maximum of 40% of NDTL (known
as the SLR) needs to be maintained in the form of gold, cash or certain approved
securities.
The excess SLR holdings can be used to borrow under the Marginal Standing Facility
(MSF) on an overnight basis from the RBI. The interest charged under MSF is higher than
the repo rate by 100 bps, and the amount that can be borrowed is limited to 2% of NDTL.
Learn more about how interest rates are determined, particularly in the United States.
Provisioning
Non-performing assets (NPA) are classified in three categories: substandard, doubtful and
loss. An asset becomes non-performing if there have been no interest or principal
payments for more than 90 days in the case of a term loan.3
Provisions for NPAs
Substandard assets are those assets with NPA status for less than 12 months. After that
time, they are categorized as doubtful assets. A loss asset is one for which the bank
or auditor expects no repayment or recovery and is generally written off the books.
Substandard assets require a provision of 15% of the outstanding loan amount for
secured loans and 25% of the outstanding loan amount for unsecured loans.
Doubtful assets require a provision for the secured part of the loan of:
 25% of the outstanding loan for NPAs in existence less than one year
 40% for NPAs in existence between one and three years
 100% for NPA’s with a duration of more than three years
The unsecured portion of such loans requires a provision of 100%.
Provisions for Standard Assets:
Provisioning is also required on standard assets. Provisioning for agriculture and small
and medium enterprises is 0.25% and for commercial real estate it is 1% (0.75% for
housing), while it is 0.4% for the remaining sectors.
Provisioning for standard assets cannot be deducted from gross NPA’s to arrive at net
NPA’s. Additional provisioning over and above the standard provisioning is required for
loans given to companies that have unhedged foreign exchange exposure.
Priority Sector Lending
The priority sector broadly consists of micro- and small enterprises, and initiatives related
to agriculture, education, housing and lending to low-earning or less privileged groups
(classified as "weaker sections").4
 The lending target for domestic commercial banks and foreign banks with greater than 20
branches is 40% of adjusted net bank credit (ANBC).4
ANBC is whichever is higher of:
 Outstanding bank credit minus certain bills and non-SLR bonds
 Or the credit equivalent amount of off-balance-sheet exposure (the sum of current credit
exposure plus potential future credit exposure that is calculated using a credit conversion
factor)
The lending target for foreign banks with less than 20 branches is 40% of ANBC.4
Lending to the Ag Sector
The amount that is disbursed as loans to the agriculture sector should either be the credit
equivalent of off-balance-sheet exposure or 18% of ANBC, whichever of the two figures
is higher.
Lending to Micro- and Small Enterprises:
Of the amount targeted for micro-enterprises and small businesses, 40% should be
advanced to those enterprises with equipment that has a maximum value of 200,000
rupees, and plant and machinery valued at a maximum of half a million rupees.
Of the total amount lent, 20% should be advanced to micro-enterprises with plant and
machinery ranging in value from just above 500,000 rupees to a maximum of a million
rupees and equipment with a value above 200,000 rupees but not more than 250,000
rupees.
Lending to Weaker Sections:
The total value of loans given to weaker sections should either be 12% of ANBC (for
2023-2024) or the credit equivalent amount of off-balance sheet exposure, whichever is
higher.
Weaker sections include specific castes and tribes that have been assigned that
categorization, including small farmers.
There are no specific targets for foreign banks with less than 20 branches.
Lack of Private Bank Lending:
The private banks in India until now have been reluctant to directly lend to farmers and
other weaker sections. One of the main reasons is the disproportionately higher amount of
NPA’s from priority sector loans, with some estimates indicating it to be 60% of the total
NPAs.
They achieve their targets by buying out loans and securitized portfolios from other non-
banking finance corporations (NBFC) and investing in the Rural Infrastructure
Development Fund (RIDF) to meet their quota.
New Bank License Norms:
The new guidelines state that:
 Groups applying for a license should have a successful track record of at least 10 years
and the bank should be operated through a non-operative financial holding
company (NOFHC) wholly owned by the promoters.
 The minimum paid-up voting equity capital has to be five billion rupees, with the NOFHC
holding at least 40% of it and gradually bringing it down to 15% over 12 years. The shares
have to be listed within three years of the start of the bank’s operations.
 Foreign shareholding is limited to 49% for the first five years of its operation, after which
RBI approval would be needed to increase the stake to a maximum of 74%.5
 The board of the bank should have a majority of independent directors and it must comply
with the priority sector lending targets discussed earlier.
 The NOFHC and the bank are prohibited from holding any securities issued by
the promoter group and the bank is prohibited from holding any financial securities held
by the NOFHC.
 The new regulations also stipulate that 25% of the branches should be opened in
previously unbanked rural areas.
Willful Defaulters
A willful default takes place in three circumstances:
1. When a loan isn’t repaid even though resources are available
2. If the money lent is used for purposes other than the designated purpose
3. If a property secured for a loan is sold off without the bank's knowledge or approval.
In case a company within a group defaults and the other group companies that have given
guarantees fail to honor their guarantees, the entire group can be termed as a willful
defaulter.
Willful defaulters (including the directors) have no access to funding, and criminal
proceedings may be initiated against them.
The RBI recently changed the regulations to include non-group companies under the
willful defaulter tag as well if they fail to honor a guarantee given to another company
outside the group.
Banking Regulators in India:
The Reserve Bank of India regulates the banking industry, as part of its duties as the
country's central bank.
RBI Regulate Banks:
The Reserve Bank of India regulates banks through inspections carried out at bank
locations and through off-site surveillance.7
India's Bank Regulations Important:
They're important because they reflect India's desire to protect the integrity of its financial
system, to maintain trust in its banking system, and to protect its consumers from financial
fraud.
The Bottom Line
The way a country regulates its financial and banking sectors is in some sense a snapshot
of its priorities, its goals, and the type of financial landscape and society it would like to
engineer.
In the case of India, the Banking Regulation Act and the regulations passed by its central
bank give us a glimpse into its approaches to financial governance. They show the degree
to which the country prioritizes stability within its banking sector, as well as economic
inclusiveness.
Though the regulatory structure of India's banking system seems a bit conservative, this
has to be seen in the context of the relatively under-banked nature of the country. The
excessive capital requirements are needed to build trust in the banking sector. Priority
lending targets are needed to make financial inclusion available to those to whom the
banking sector generally would not lend.
Since the private banks, in reality, do not directly lend to the priority sectors, the public
banks have taken up the slack. A case could also be made for adjusting how the priority
sector is defined, in light of the high priority given to agriculture even though its share
of GDP has been going down.
For related reading, see "The Increasing Importance of the Reserve Bank of India"
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What is Commercial Bank?
A commercial bank is a kind of financial institution that carries all the operations related
to deposit and withdrawal of money for the general public, providing loans for investment,
and other such activities. These banks are profit-making institutions and do business only
to make a profit.
The two primary characteristics of a commercial bank are lending and borrowing. The bank
receives the deposits and gives money to various projects to earn interest (profit). The rate
of interest that a bank offers to the depositors is known as the borrowing rate, while the
rate at which a bank lends money is known as the lending rate.
Related link: Banking and its Type
Function of Commercial Bank:
The functions of commercial banks are classified into two main divisions.
(a) Primary functions
Accepts deposit : The bank takes deposits in the form of saving, current, and fixed
deposits. The surplus balances collected from the firm and individuals are lent to the
temporary requirements of the commercial transactions.
Provides loan and advances : Another critical function of this bank is to offer loans and
advances to the entrepreneurs and business people, and collect interest. For every bank, it
is the primary source of making profits. In this process, a bank retains a small number of
deposits as a reserve and offers (lends) the remaining amount to the borrowers in demand
loans, overdraft, cash credit, short-run loans, and more such banks.
Credit cash: When a customer is provided with credit or loan, they are not provided with
liquid cash. First, a bank account is opened for the customer and then the money is
transferred to the account. This process allows the bank to create money.
(b) Secondary functions
Discounting bills of exchange: It is a written agreement acknowledging the amount of
money to be paid against the goods purchased at a given point of time in the future. The
amount can also be cleared before the quoted time through a discounting method of a
commercial bank.
Overdraft facility: It is an advance given to a customer by keeping the current account to
overdraw up to the given limit.
Purchasing and selling of the securities: The bank offers you with the facility of selling
and buying the securities.
Locker facilities: A bank provides locker facilities to the customers to keep their valuables
or documents safely. The banks charge a minimum of an annual fee for this service.
Paying and gathering the credit : It uses different instruments like a promissory note,
cheques, and bill of exchange.
Types of Commercial Banks:
There are three different types of commercial banks.
Private bank –: It is a type of commercial banks where private individuals and businesses
own a majority of the share capital. All private banks are recorded as companies with
limited liability. Such as Housing Development Finance Corporation (HDFC) Bank,
Industrial Credit and Investment Corporation of India (ICICI) Bank, Yes Bank, and more
such banks.
Public bank –: It is a type of bank that is nationalised, and the government holds a
significant stake. For example, Bank of Baroda, State Bank of India (SBI), Dena Bank,
Corporation Bank, and Punjab National Bank.
Foreign bank –: These banks are established in foreign countries and have branches in
other countries. For instance, American Express Bank, Hong Kong and Shanghai Banking
Corporation (HSBC), Standard & Chartered Bank, Citibank, and more such banks.
Examples of Commercial Banks
Few examples of commercial banks in India are as follows:
1. State Bank of India (SBI)
2. Housing Development Finance Corporation (HDFC) Bank
3. Industrial Credit and Investment Corporation of India (ICICI) Bank
4. Dena Bank
5. Corporation Bank
Regional Rural Banks
Regional Rural Banks (RRBs) are financial institutions in India that are designed to
provide banking services in rural areas. They were established under the Regional Rural
Banks Act of 1976, with the aim of bringing banking services closer to rural and
agricultural communities and promoting rural development.
RRBs are structured as scheduled commercial banks and are regulated by the
Reserve Bank of India (RBI). They operate in a specific region, generally consisting of
districts within a state. Each RRB is sponsored by a commercial bank, which provides
necessary support and assistance.
RRBs are jointly owned by the Central Government, the State Government, and the
sponsoring commercial bank in a specific ratio. The central government holds a 50% stake,
the state government holds a 15% stake, and the sponsoring commercial bank holds a 35%
stake.
Regional Rural Banks Functions
1. Banking Services: RRBs provide banking services like savings accounts, current
accounts, deposits, and basic transactions to rural areas.
2.Credit Facilities: RRBs offer loans to farmers, agricultural laborers, artisans, and small
entrepreneurs for agriculture, livestock, machinery, housing, and small businesses.
3.Agricultural and Rural Development: RRBs support agricultural activities, rural
infrastructure development, and small-scale industries for overall rural growth.
4.Financial Inclusion: RRBs promote financial inclusion by opening bank accounts,
encouraging savings, and providing institutional credit to unbanked and underbanked rural
areas.
5.Cooperative Banking Activities: RRBs work with agricultural cooperatives and
self-help groups to provide financial support and foster cooperation among rural
communities.
6.Priority Sector: Lending RRBs prioritize lending to sectors like agriculture, micro and
small enterprises, and weaker sections of society as mandated by the RBI.
Challenges Faced by Regional Rural Banks:
Financial Viability:
Maintaining financial viability is a challenge for RRBs due to factors such as low-profit
margins, high operating costs, and loan recovery issues in rural areas.
Asset Quality:
RRBs often face challenges in managing asset quality, especially in the agricultural sector
where loan defaults can occur due to factors like crop failure, natural disasters, or price
fluctuations.
Capital Constraints:
RRBs may face capital constraints, limiting their ability to meet the increasing credit
demand in rural areas and comply with regulatory requirements.
Technological Advancements:
Adopting and integrating new technologies pose a challenge for RRBs, particularly in
remote rural areas where infrastructure and connectivity are limited.
Human Resource Development:
RRBs face challenges in attracting and retaining skilled personnel in rural areas,
which can impact their ability to deliver efficient banking services and implement effective
risk management practices.
Governance and Management:
Effective governance and management practices are essential for the smooth
functioning of RRBs. However, challenges related to governance, leadership, and internal
controls may arise, impacting operational efficiency and transparency.
Regional Rural Banks Reforms Needed:
Several committees have been constituted to recommend reforms for Regional
Rural Banks (RRBs). Here are recommendations of some notable committees:
Vyas Committee (2004):
Recommended the conversion of RRBs into full-fledged commercial banks to enhance
their financial strength and operational efficiency.
Suggested raising the capital adequacy ratio to 9% to ensure the financial stability of RRBs.
Advocated for the strengthening of governance and management practices in RRBs.
Chore Committee (2015):
Recommended measures to improve the financial viability of RRBs, including capital
infusion by the government and sponsorship by strong commercial banks.
Emphasized the need for performance-based incentives and a robust business strategy for
RRBs.
Suggested the adoption of technology-driven banking practices and enhanced risk
management frameworks.
Nayak Committee (2018):
Recommended a comprehensive reform package for RRBs, including the recapitalization
of financially weak RRBs.
Suggested consolidation of RRBs to create stronger and more sustainable entities.
Emphasized the importance of enhancing digital banking capabilities and financial
inclusion efforts.
Sudarshan Sen Committee (2019):
Recommended a roadmap for the transformation of RRBs into “Universal Banks for Rural
India.”
Advocated for the strengthening of governance, risk management, and internal controls in
RRBs.
What is Retail Banking?
Retail banking, also known as consumer banking or personal banking, offers financial
services to individual consumers rather than enterprises. Customers can manage their
money, get credit, and deposit money safely and securely when via retail banking services.
In the United States of America, commercial banks are also called retail banks, and
investment banks can only invest money in market operations.
Since this demarcation was done away with in the 1990s, commercial banks now handle
deposits and loans from corporations and other large businesses. In contrast, retail banks
handle deposits and loans for regular consumers.
How does Retail Banking Work?
Retail banks offer a wide range of services to the general public, such as bank
accounts, fixed deposits, credit and debit cards, loans, etc. These services help people
efficiently manage their finances. Retail banking services, like deposits and withdrawals,
can be done both online and at the bank branch.
Online retail banking has made it easier for individual consumers to avail of home loans,
personal loans, car loans, open fixed and recurring deposits, transfer money, etc. However,
the range of services and products offered could vary from bank to bank.
Example of Retail Banking
Let’s say you are going to a bank with the sole intention to deposit money. In the bank, you
come across a bank representative. The representative tells you some of the lucrative
investment schemes available. You get impressed and you invest a certain sum in the
scheme. Simultaneously, the representative tells you about a senior citizen FD scheme.
Since, FD interest rates are higher than that of normal FD schemes, you open an FD account
for your parent or any relative.
All these facilities or services fall under retail banking.
Types of Retail Banks:
The following types of retail banks can be categorised under them:
1. Large Bank
These are well-established banks having a national presence. Retail consumers trust these
banks because of their prominence and the variety of services.
2. Community Bank
Community banks offer loans and depository services and mostly operate in a smaller
geographical area.
3. Online Bank
Online banks offer digital-only products and services. You can access their products via
computer or mobile device.
4. Regional Rural Bank
These banks were set up in rural areas to serve the needs of people living in rural areas.
Such banks are mostly present in Tier 2 , Tier 3 and Tier 4 cities.
5. Post Office
Post office offers depository and other savings schemes. People living in the rural area
prefer post office services due the age-old trust built by the institution.
Types of Retail Bank Services and Products
Some of the services and products offered by retail banks include:
1. Bank Account Opening
Checking accounts, savings accounts, and retirement accounts are just a few of the different
types of bank accounts that you can have via retail banking services. Certain banks let you
open a zero-balance savings account where there’s no cap on minimum account balance.
2. Deposits
You can open a fixed deposit (FD) or recurring deposit (RD) account via retail banking.
FDs are a preferred choice for risk-averse investors due to assured returns and interest rates
that are higher than savings accounts. NRIs also have the option to open NRE, NRO or
FCNR accounts.
3. Loans
You can get home loans, personal loans, two-wheeler loans, auto loans, etc., via retail
banking. In case you were looking for a home loan or an instant personal loan in a 100%
paperless way, download the Navi app.
4. Cards
Debit cards and credit cards are the two most popular cards offered by most retail banks in
India. Other than these, there are Prepaid cards, No-cost-EMI cards, etc.
5. Investment and Insurance
Retail banks also offer other investment avenues like mutual funds, NPS, etc. Similarly,
some retail banks also have an insurance arm through which you can buy a general health
insurance policy.
6. Other Services
 Other services include money transfer, account balance check, issuing cheque books,
setting up auto debit or standing instruction to pay EMIs, card upgrade request, utility bill
payment, bancassurance, safe deposit lockers, demat account, demand draft, etc.
Retail Banks Generate Income:
Retail banks receive money from their customers’ deposits. These banks use the deposited
funds from clients to lend money to clients who want a loan at a higher interest rate on the
principal amount compared to the interest rate it offers to depositors. This difference in
interest rate spread is how retail banks make profits.
Retail banks also generate income from fees on various services, including account opening
charges, brokerage fees, loan processing fees, credit card charges, etc. as well as from their
investments and services in the capital markets.
In India, the Reserve Bank of India (RBI), regulates the functioning of all retail banks. It
has the power to regulate the funds that retail banks are required to hold as deposits with
them, which ensures that anyone can make withdrawals. In addition, it provides funds for
banks for their daily functioning.
Retail Banking vs. Corporate Banking:
Retail banks are customer oriented whereas corporate banks cater to businesses. The
various products these two banks offer their consumers are also very different. The retail
bank provides services to individuals and small businesses but not to large enterprises.
In retail banks, financial transactions are much smaller than in corporate banks and they
make most of their profits by creating a margin between the interest it receives from
borrowers and the interest it pays to depositors.
On the other hand, corporate banks make profits primarily by charging interest and fees for
the services they provide to large businesses. These banks also provide investment banking
services to the general public, as well as asset management services.
Benefits of Retail Banking:
Here are some of the benefits of retail banking:
1. Offers individual customer services with the help of a relationship manager
2. Multiple products and services under one roof – from deposits to loans
3. Deposits like FD offers guaranteed returns
4. Innovative products that can be accessed easily via net banking
5. Home to thousands of banks and NBFCs
6. Access personal finance products from anywhere, anytime
What is financial service marketing?
Financial service marketing is the process of promoting the products and services of a
financial services firm. Marketing efforts for any company typically have the goals of
raising brand awareness, attracting customers, making sales and generating revenue. Here
are some examples of financial services firms that may benefit from marketing:
 Commercial banks
 Credit unions
 Financial planning firms
 Accounting firms
 Investment banks
 Insurance companies
 Brokerage firms
 Mutual funds institutions
These organizations may aim to help customers by providing support services, such as:
 Banking
 Loans
 Wealth management
 Insurance
 Financial advice
 Stocks and investments
 Accounting and bookkeeping
 Tax consulting
Who uses financial services?
Financial services are useful to a variety of institutions. This is because many organizations
and agencies, whether for-profit, nonprofit or government, require funds and resources to
operate. Financial service businesses have teams of experts in complex financial and
economic matters and can help companies or individual clients with managing money and
capital responsibly. Marketers for finance businesses can create content for specific target
audiences to capture attention and attract clients. Here are some common clients of
financial service firms:
 Individual customers: Many people use financial service firms like banks daily to save
and transfer money, take out and pay back home and auto loans and make investments.
 Commercial businesses: These clients may pay financial services companies to manage
their books and ensure adherence to tax and other business-related financial laws and
regulations.
 Health care facilities: Health care facilities often work with insurance companies and
other financial institutions to process insurance claims and transfer payments for services
rendered.
 Educational institutions: Schools, colleges and universities may require the services of
accounting firms and other finance businesses to keep track of school expenses and support
the finances of staff and students.
Financial service marketing:
1. Digitization:
Providing digital products can help you market your financial services and gain
more customers. For example, you might develop a mobile app for customers to sign in to
online accounts, view their finances, gain customer support, schedule services or make
purchases from their phones or tablets. Along with increasing convenience for both
customers and employees, digitization can help to keep sensitive financial information safe.
2. User experience:
Optimizing user experience means making it easy for users to navigate a business's
digital resources. Ensuring a company's website, app and other resources are free of errors
is critical to maintaining customers. By offering a high-quality user experience, you can
convince customers of the superior quality of your financial products and services.
3. Social media marketing:
Many modern consumers use social media daily. Advertising your finance business
services on various social media platforms can reach a large variety of audiences and
encourage people to visit your website, explore more about the business and even make
purchases. Make sure to include easy links to email lists, apps and other financial resources
so customers can navigate from social media apps to the business.
4. Education:
Providing educational materials to customers can be a great way to promote your
services and raise awareness of your brand. Consider publishing articles, infographics and
ebooks about popular financial topics to help customers learn about finance and discover
the business. Answering questions and providing information can help teach customers the
importance of your services.
5. Customer support:
Develop ways to provide customer support and help consumers with the unique
issues they may be experiencing. Many companies hire specific team members to work in
customer support departments, answering calls and responding to messages. Strong
customer and technical support can show customers you care about their needs and
encourage them to continue using your services.
6. Data analysis:
Data analysis is the process of gathering and assessing large amounts of information
to gain actionable business insights. Financial service companies can track customer data
to determine customer behaviors, needs and feelings. Then, marketers can collaborate with
product development teams to solve any issues, optimize services and provide more value
to customers.
7. Customer outreach:
Customer outreach is the process of communicating with customers and trying to
increase customer engagement rates. Initiating a relationship with customers can help raise
awareness about a business, encourage customer loyalty and improve customer retention
rates. Financial service firms can perform outreach by offering resources like free
consultations, webinars or financial management programs. They can also engage
customers through email marketing strategies, like mailing lists.
8. Relationship-building:
Beyond digital engagement, financial businesses can practice relationship-building
to connect with customers personally. As a marketer, salesperson or account manager,
consider reaching out to customers personally to schedule meetings. These meetings could
be to answer questions, give sales pitches or discuss business in general. Client
relationship-building can occur over lunch and dinner dates, sports games or other social
activities.
9. Customer feedback:
Customer feedback is essential for gauging customer satisfaction with a company's
products and services. Conducting surveys over social media, email or in person can help
you gather qualitative and quantitative data. You can then use this data to develop relevant
promotional material.
 10. Creative marketing:
Being creative is key to setting your marketing campaigns apart from competitors.
Consider promoting your business mission and characterizing your brand with a specific
social goal. Then, create and deliver emotional and powerful stories that display the
company's work to reach this goal.

Unit-III
Hospital Services:
Overview
India’s healthcare system has undergone major changes in recent times and has
become one of the largest industries in terms of employment and revenue. Indian healthcare
systems consist of two major components namely; Public (or the Government) and Private.
The government or the public healthcare sector consists of few secondary healthcare
institutions in few major cities focussed to providing basic healthcare by setting up
community-level healthcare centers mostly in the rural areas. While the private sector
largely concentrates in metro, tier I and tier II cities. India has a large number of well-
specialized medical personnel in various medical fields which gives it a competitive edge.
India is also cost effective when compared to other countries in Asia and in the West.
The Healthcare Industry in India is segmented as;
 Hospitals
 Pharmaceuticals
 Diagnostics
 Medical Equipment and Supplies
 Medical Insurance
 Telemedicine
Healthcare Market Size in India
The Healthcare Industry in India was estimated at INR 18.8 trillion and it is expected to
reach INR 25 trillion by 2022. The industry is expanding at a CAGR of 22% till 2022.

Competitive Landscape
 India’s healthcare industry is primarily dominated by hospitals that accounts for
approxiamtely 80% of the total market. The increase in medical tourism is paving a way
for foreign investors to invest in Indian healthcare industry. Some of the leading hospitals
include; Apollo, Aster DM Healthcare and Fortis Healthcare. As the world is becoming
digitalized, we see a lot of new players entering the digital healthcare space in the country.
Some well known players are; Practo, 1MG, Pharmeasy, Netmeds, Medlife and Lybrate.
We see a fierce competition in the healthtech companies as more people are adapting to the
technology enabled healthcare services.
Growth Drivers for Indian Healthcare Industry
Favourable Government Initiatives & Policy
 Pradhan Mantri Jan Arogya Yojana (PMJAY) was launched in 2018 to provide health
insurance worth INR 500,000 to over 100 million families every year.
 Ayushman Bharat-National Health Protection Mission was approved to cover secondary
and tertiary care hospitalization of poor and vulnerable families in the country.
 Mission Indradhanush was introduced in 2014 aimed to achieve 90% full immunization
coverage for all children upto two years of age both in rural and urban areas.
 The government of India approved a 100% FDI in Greenfield and Brownfield projects.
 Single window clearance e-portal to improve ease of doing business in the country.
Medical Tourism
Over the years, India has transformed into a top-tier destination for medical tourism. Low
cost of medical treatment is the major reason that motivates many tourists to visit India for
their medical assistance. Also the process to obtain a visa is much more efficient when
compared to other countries.
Rising Minimally Invasive Procedures
An increasing number of hospitals are transitioning towards minimally invasive surgeries
in recent times. These surgeries benefit the patients by early discharge from hospital and
return to normal life and for the hospitals with higher profitability.
Changing Disease Profile
Increasing prevalence of life-style and non-communicable diseases such as diabetes,
cardiovascular diseases etc among young adults may fuel the demand for healthcare in the
country.
Increased Affordability
The rapidly growing middle class population, their rising income levels and awareness
increases the demand for better healthcare services.
Challenges for Indian Healthcare Industry
Low Spending on Healthcare
Indian government’s spending on healthcare still remains a major challenge for the
industry. According to the 2021 budget, public expenditure stood at 1.2% of the overall
GDP of the country. This is too low when compared to WHO’s recommendation of 5%.
Inadequate Healthcare Infrastructure
Being the second most populous country in the world, the current healthcare infrastructure
is insufficient to meet the demands of the expanding population. Lack of well-equipped
medical institutes burdens the industry. Also, the doctor-population ratio is 1:1456 against
1:1000 recommended by WHO. The country faces a severe shortage of doctors and
specialists especially in the rural areas and makes it difficult for healthcare to reach every
citizen.
Low Insurance Penetration
Over 80% of the population in India is not covered under health insurance and due to this
the economically backward people are not able to access proper healthcare.
Indian Healthcare Industry
The healthcare industry has been at the epicenter of the coronavirus pandemic.
Similar to other industries in the country, it also faced severe challenges. The private
healthcare sector that accounted for a major portion of inpatient care faced various
challenges due to changing government regulations, increasing cost of human resources,
high procurement cost of medical consumables & disposables, unreasonable price caps etc.
Although, majority of the people prefer private healthcare over government healthcare,
privately run hospitals suffered massive losses during the pre-covid times and now the
situation has turned worse leaving hospitals with uncertainty on profitability for the post-
covid period. According to FICCI, footfall & test volumes declined by 70-80 per cent and
the healthcare sector in India witnessed a revenue drop of 50-70 per cent by end of March
2020.
ADVANTAGE INDIA
ROBUST
DEMAND
*The Medical Tourism sector is predicted to increase at a CAGR of 21.1% from 2020-27.
*The travel market in India is projected to reach US$ 125 billion by FY27 from an
estimated US$ 75 billion in FY20.
*International tourist arrivals are expected to reach 30.5 million by 2028.

ATTRACTIVE
OPPORTUNITIES
*India is geographically diverse and offers a variety of cultures that come with its own
experiences, making it one of the leading countries in terms of international tourism
expenditure.
*Travel and tourism are two of the largest industries in India, with a total contribution of
about US$ 178 billion to the country’s GDP.
*The country’s big coastline is dotted with attractive beaches.

POLICY
SUPPORT
*US$ 2.1 billion is allocated to Ministry of Tourism in budget 2023-24 as the sector holds
huge opportunities for jobs and entrepreneurship for youth. Rs. 2400 crores (US$ 289.89
million) allocated to the Ministry of Tourism as the sector holds huge opportunities for jobs
and entrepreneurship for youth.
*Under the Union Budget 2023-24, an outlay of US$ 170.85 million has been allocated for
the Swadesh Darshan Scheme.
*68 destinations/sites have been identified in 30 States/UTs for development under the
PRASHAD Scheme as on March 31, 2022.

DIVERSE
ATTRACTIONS
*India is geographically diverse and offers a variety of cultures that come with its own
experiences, making it one of the leading countries in terms of international tourism
expenditure.
*Travel and tourism are two of the largest industries in India, with a total contribution of
about US$ 178 billion to the country’s GDP.
*The country’s big coastline is dotted with attractive beaches.
Last updated: Oct, 2023
Hospital Supportive Services:
1. Outpatient Services:
Walk-in health care is given to patients who are most certainly not confined to bed and can
be treated at a general hospital, a specialised hospital, or a welfare hospital. When such
care is rendered at premises which are a piece of a hospital (outpatient division), then they
are called outpatient care. Furthermore, the management stemming from it is named
outpatient services. Outpatient division is characterised as a section of the hospital with
designated physical offices, medicinal staff, regular planned hours, to give care to patients,
who are not enlisted as inpatients. Size and importance of outpatient services A survey of
the rank of outpatient services provided by medical facilities in India requires attention.
2.Nursing Services:
Nursing services stand out amongst the most critical services of medical facility.
Nursing services in a more extensive setting is that part of the complete healthcare
management, which intends to fulfil the nursing needs of the network, the significant
targets of which are:
Nursing care required for the prevention of sickness and improvement of
well-being.
3.Radiology and Imaging Services:
It goes without saying that the technical aspects of hospitals are of immense value.
With out its aid, the whole healthcare system will be on the road to ruin. Thus,
services like Radiology and Imaging holds especial place in the scheme of healthcare.
The modern drug can’t be prescribed without certain insights. Radiology or
Radiodiagnosis is one such vital division of the hospital, which clearly contributes
to the patient’s care. It gives, alongside pathology, an essential demonstrative
reinforcement to every one of the specialities which can’t work successfully without
 its help. Consequently, the organisation turns into a necessary part with everything
being the same except for little hospitals and nursing homes. Radiology has
immensely expanded in the recent decades. The term imaging includes:
X-Ray
Ultrasound
CT Scan
Magnetic Resonance Imaging (MRI)
Digital Subtraction Angiography (DSA)
4. Laboratory Services:
Similar to the radiology and imaging department, laboratory services too are
indispensable part of the hospitals. The whole healthcare system rely on it to diagnose the
patients’ ailments correctly and treat them successfully.
5. Pharmacy Services:
Purchasing medicines and keeping up an excellent stock of medications,
manufactured substances, and chemicals render a considerable amount of cash, next to
compensations and wages. Around 20 percent of the hospital costs are represented by drugs
and pharmaceutical supplies. Accessibility to the correct medication at the required place
at the critical moment is the means to the hospital’s existence.
6.Administrative Services:
For any organization to work properly, its administration should be well-oiled
machinery. This is especially true for hospitals. It is extremely important for the proper
functioning of a hospital.
7.Hospital Linen Services:
Quality bed material, arrangement of good, clean cloth for patients and continuous
supply of required material to wards and departments positively affect the image of a
hospital. However, because of insufficient availability of Operation Theatre material and
complaints of inadequately washed and rarely changed bed cloth by patients can be often
heard in hospitals.
8.Hospital laundry services:
The services rendered by a hospital laundry are drastically different from a
commercial laundry. A commercial laundry is responsible for household laundry, which
include massive amount of material that must be assorted, pressed by hand, NOTES Self-
Instructional Material 15 Principles and Methods of Organising Hospital Support Services
and arranged. Then, again a hospital also has a pile of clothes, for example, sheets, covers,
clothes, and towels, which require no work or planning.
9.Dietary Service:
This offers a variety of food items which are hygienically prepared and served. A
spacious canteen which is capacious to accommodate many people to dine is the Favorite
food corner of the staffs, patients and bystanders as it offers food items at an affordable
cost. It takes special consideration of the dietary nature of the patients and offers them such
desirable prepared food particulars.
General Acts/Legislations for Hospitals:
 In order to secure hospitals’, hospital staff’s, as well as patients’ rights, certain acts
were imposed. These acts were meant to bring justice to the victims and avoid wrong
conviction. Some of these acts are: I. Industrial Disputes Act, 1948:
Under this act, clinics were incorporated under the term ‘business’. The Industrial
Disputes Act is relevant, where the number of workers is at least 50. It provides a method
to deal with disputes emerging in a modern organisations. A 1982 alteration to the act
exempted hospitals and dispensaries, among others, from the purview of the act,
nevertheless, this arrangement was revoked by a revision in 1984. The administration has
now an extensive enactment under its effective idea to manage modern disputes. II.
Minimum Wages Act, 1948:
Under this act, minimum wages are fixed for various classes of labourers.
III. Employees’ Provident Fund Act, 1952:
The clinics as businesses are required to contribute an equivalent sum as the
employees’ salary and acknowledge the reserve consistently for the government. It is
relevant to hospitals if the number of employees is more than twenty. Violation of this act
is can lead to imprisonment.
IV. The Payment of Bonus Act, 1956:
This act is pertinent to hospitals with at least forty workers. Welfare or non-profit
hospitals are exempted from this act.
V. The Payment of Gratuity Act, 1972:
Gratuity is payable to workers for each finished year of service at the time of his or
her retirement or demise. This act is applicable, where there are at least 10 surgeons and
applied on those who have finished five years of service (or at least one year if there they
died).
VI. The Payment of Wages Act, 1936:
This act ensures that the employees are paid on time without any illegal deductions
from their salaries. VII. Indian Medical Council Act, 1933: Indian Medical Council Act,
1933 sets out the code of morals for medical surgeons and directs medical education. State
Medical Councils built under the act have the same responsibility in their respective states.
Apart from that supporting hospitals is partly administered by the IMC act.
VIII. The Indian Nursing Council Act, 1947:
Indian Nursing Council Act, 1947 sets out the instructive models and necessities for
enrolment of medical caretakers.
IX. The Pharmacy Act, 1948:
The Pharmacy Act, 1948 manages the foundation of drug stores and medication
stores. A hospital needs to procure a medication permit if it sells drugs over the counter,
where only a pharmacist can be utilised for distributing medications.
The Medical Staff Organization (MSO)
Medical staff members are those licensed healthcare providers (physicians, nurses, allied
health professionals, and other healthcare workers) who are authorized by the state law and
hospital’s bylaws to provide medical care within a healthcare establishment.
In most hospitals, these healthcare professionals are organized into a medical staff
organization to promote patient safety and clinical performance accountability.
 Members of medical staff organizations perform significant functions in the hospitals,
despite most being independent medical practitioners and aren’t full-time hospital
employees.
The core responsibility is to provide the best quality patient safety and care.
The members are free to act as a team to communicate with staff leaders and the governing
board regarding matters concerning the organization and the staff.
Medical Staff Leaders’ Responsibilities
Medical staff leaders are responsible for the leadership and management of a medical
organization.
To lead effectively, practice managers and leaders must:
 Fully understand their roles to avoid mediocre or poor leadership. Get educated, attend
medical and leadership seminars, conferences, programs, and read relevant materials.
 Be goal-oriented. Create goals that will boost excellent patient care and satisfactory patient
experience.
 Take necessary actions to solve problems. A wise staff leader doesn’t wait for an issue to
go away on its own. He or she knows when and how to implement viable solutions to
address the problem.
 Lead by example. Be a role model to fellow staff leaders and members.
 Develop a great working relationship with fellow staff leaders and members. Motivate the
members and leaders to work together harmoniously towards healthcare success.
 Stand firm on decisions concerning patient care and safety. The members of the medical
staff organization rely upon the staff leaders for their firm decision-making skills.
Healthcare leaders don’t back down on issues that are critical to achieving quality patient
care.
 Promote teamwork. A wise medical staff leader does not do everything on his or her own.
He or she encourages everyone to initiate working on necessary tasks and support them
with appropriate resources.
 Manage efficient and effective meetings. The objectives and outcomes of these meetings
are critical to the success of the entire organization and its journey to better patient care.
 Be open to new ideas. Changes are inevitable to every organization. Be open to your staff
members’ ideas, suggestions, and concerns. Listening to their voice and implementing
necessary changes or improvements can make progressive impacts on your hospital and
medical staff organization.
Just be mindful during the decision-making and implementation processes. The plan should
be well-thought-out, achievable, and equipped with the right resources.
Here are the usual leaders of a medical staff organization.
Board members:
The Board of Trustees is the executive committee governing the medical organization.
They are responsible for the establishment and implementation of the hospital’s bylaws,
policies, medical state laws, and regulations.
The board members are expected to be ethically, financially, and legally responsible for the
overall operations of the medical establishment.
Hospital Administrator
 The Hospital Administrator (also known as the Hospital Director, Executive Director,
President, or Chief Executive Officer) is responsible for the creation and up-living of the
organization’s vision and mission.
He or she oversees the day-to-day management of the hospital, ensures budget, maintains
good relations between medical staff, and reports and carries out the directives given by
the Board of Directors.
Second-level managers
The second-level managers typically include the following:
 The Chief Operating Officer (COO), also known as Vice President of Operations.
Responsible for the day-to-day operations of the medical organization.
 The Chief Financial Officer (CFO), also known as the Vice President of Finance.
Responsible for the management of the hospital’s finances.
 The Director of Nursing (DON), often known as title Associate Director of Nursing. In-
charge of the overall supervision of patient care within the hospital.
Chief of Staff :
The Chief of Staff is the head of the medical staff. He or she is expected to have good
leadership and guidance, and promote effective communication and relationships between
the members of the medical staff organization, including the board members and hospital
administrators.
Before assuming the role, the Chief of Staff must be a dynamic member of a medical staff
organization and has enough training and experience in both medical administrative
activities and leadership.
Director of Medical Staff Services:
The medical staff services is a department that supports medical staff organization
activities. They are headed by the director of medical staff services (DMSS).
The DMSS leads, manages, and oversees operational medical staff service. He or she works
collaboratively with other medical staff leaders to plan, organize, direct, and coordinate
activities that will support the organization to attain goals and realize plans.
The director has to obtain and maintain knowledge relevant to credentialing, accreditation
requirements, etc. to ensure that the organization is following the relevant regulatory and
accreditation bodies.
Responsibilities of Medical Staff Members:
Most medical staff members are healthcare professionals who examine, diagnose, treat and
prevent injuries, illnesses, and other impairments.
There are also staff members who didn’t receive medical school education but are equipped
with knowledge and skills beneficial to a healthcare facility.
Medical staff members should be equipped with the following qualities:
 Empathy
 Emotional stability
 Attention to detail
 Communication and interpersonal skills
 Team player
 Problem-solving skills
 Technical skill and knowledge
 Motivational skills
Here are the common members of a medical staff organization:
Doctor/Physician:
Doctors are the medical staff that assesses and manage patients’ medical care. Their roles
and responsibilities vary depending on their medical specialty and level of experience:
These roles include:
 Senior consultants (medical officers) – Specialist doctors who see patients and attend
meetings at specific times.
 Registrars – Senior physicians who oversee residents, interns, and medical students on-
site.
 Residents – Ward-based physicians who are also in training for a medical specialization
 Interns – Medical students who have completed their studies and are now finishing their
final year in the hospital.
 Medical students – Undergraduate students specializing in healthcare.
Nurses:
Nurses manage most of the ongoing treatment and care in a healthcare facility. Their
common responsibilities involve the assessment, planning, and administration of day-to-
day patient treatment and health management.
Patients commonly ask assistance from nurses to attend to their immediate needs,
especially when the assigned doctor isn’t around.
Similar to physicians, nurses have different roles and responsibilities based on their
experience and specialties.
These roles include:
 Nurse Unit Manager who heads and runs the ward.
 Associate Nurse Unit Manager who assists the nurse unit manager in running the ward and
acting as the manager when the nurse unit manager is not around.
 Nurse Practitioners are the highly-skilled nurses with advanced levels of training.
 Specialist Nurses, such as clinical nurse specialists, clinical nurse consultants, clinical
nurse educators, triage nurses, emergency department nurses
 Registered Nurses provide quality day-to-day care and perform some minor procedures to
a patient.
 Enrolled Nurses to provide basic medical care under the guidance of senior nurses.
Allied Health Professionals:
Allied health professionals are the expert practitioners who work as part of a
multidisciplinary medical staff organization. They are responsible for the assessment,
diagnosis, and treatment of conditions and work to prevent disease and disability.
Some allied health professionals also have trained allied health assistants to support them
in their role.
Examples of allied health professionals include:
 Dietitians
 Occupational Therapists
 Social Workers
 Interpreter
 Pharmacists
 Physiotherapists
 Radiology Technicians
 Patient Care Technicians
 Podiatrists
 Speech Pathologists
The Procedure for Hospital Set Up in India
Registration under the clinical establishment act, 2017
This act was enacted by the central government and is being adopted by states of India. It
needs a one-time registration for a premise towards being operated as a hospital. The
registration must be done by the respective state government that has adopted this act. For
registration, hospitals should fulfill the minimum requirement under the category in which
it falls. Each state has described the procedure of registration of the hospitals that fall within
their territory.

>Registration under companies’ Act, 2013

This act is applicable when the hospital established it under the ownership of a corporation.
The act needs that the corporation is registered and fulfills the requirement of incorporation
like memorandum of association, articles of association, capital structure formation,
securities allotment, account audits, etc.

Director Index No (DIN NO) for each director

This comes under the Ministry of Corporate Affairs, Government of India. It is a
compulsory registration required for each director who wants to be a part of a corporation.
It is a onetime registration for directors.
Registration under societies registration act, 2001
In case the hospital is being established under the ownership of society, the society
registration act is required.
Locations of the Hospital:
This is required to be chosen well, because if there are already some hospitals in the
locality, then it would be difficult to get in patients. Also, the hospital must set up in an
area that has a good transportation facility or is close to a railway station. One must look
for a non-agricultural land particularly designed for hospitals. All the electricity supply, as
well as the water supply, should be easily available and that is required to be checked before
purchasing any land for the hospital set up.
Facilities Offered:
The facilities offered through the hospital should be decided by the management dependent
on the locality of the hospital. It might be generalized into pathology, ICU treatment;
orthopedic, as well as other specialized services should be specified. Also, the facilities
linked to electricity, AC rooms, water, hygiene maintenance, etc, should be checked before
providing any specialized services.
 Permits:
Land and construction:
A Hospital could be set up only on a no- Agriculture land could be used. The numerous
approval, as well as permissions required from the local authority and the government,
should be obtained before starting any hospital.
Electricity and water:
A hospital needs approximately 100 liters of water per bed each day. The water requirement
for the various hospitals would be different from project to project based on whether the
hospital is a primary, specialized hospital, etc. The concerned municipal authority
permission should be obtained for making available the water as well as electricity
facilities.

Sewage:
Well planned sanitary measures for disposal of waste as well as drainage system which
includes tanks, pipelines, etc. and permission from the local authorities should beobtained.
Biomedical Waste:
The large hospitals must have an incinerator for disposal of bio-disposal waste, for
instance, body parts or tissues. A smaller hospital is not able to afford such cost and it needs
minimum space and additional machinery installations which are expensive for a small
hospital set up. The Municipal corporation permission would also be required for such
disposal of waste and it must not be harmful to the people living at a nearby location.
Fire and Health License:
Approval of Fire Department is required for a large hospital as well as ahealthcertificate
from the local authority after installation of all the beds and equipment within the Hospital.
A NOC from Fire the department shall also be required for small hospitals and it would be
the responsibility of the hospital management to prove that the hospital would not cause
any harm or loss of life and requires to be procured from the local municipal council.

Regulations relating to Employment of Staff

 Employment of employees (Doctors, Nurses, Pharmacists) only after proper credentialing
 Prevention of sexual harassment of women employees at the workplace
 Responsibility of the employer for the safety of workforces
 Rules governing the employment of staff
 Immunization / other measures for the protection of staff from Occupational Health
hazards.

SignBoards:
Rules for the size, contents as well as the correct place for signboards (IMC
Regulations2002)
Information that requires be displayed at the Hospital are:
1. Certificate of registration of hospital with the municipal authorities
2. IMC/SMC registration certificate (IMC Regulations, 2002)
3. Charges for consultation as well as other procedures/services (IMC Regulations 2002)
4. Clinic timings, closed days

FSSAI license for operating a kitchen:

FSSAI license comes under the Food Safety and Standards Authority of India under the
Ministry of Health and Family Welfare, Government of India. The license is necessary if
the hospital runs an in house kitchen for the patients as well as attendants.
Permit to store LPG cylinder:
If the hospital store has an LPG cylinder in large quantity for usage in the hospital's Kitchen
or hospital purposes, the hospital must have a permit of Controller of Explosives under the
Petroleum act, 1934.
Pharmacy registration for medical shop:
This comes under the Office of the Drug Controller. There are different licenses for medical
shops attached to hospitals (IP) and standalone medical shops. There are minimum
requirements for the registration like the minimum size of the shop ( 250 – 300 ft) as well
as requirements of Air conditioner and Refrigerator. This license is valid for 5 years.
Trademark registration:
Indian Trademarks Act 1999 is not a mandatory activity and is essential only if the hospital
wants to trademark its logo or name
Vehicle registration for ambulances:
The ambulance bought by the hospital must be registered under RTO, Transport
Department,andstategovernment.
Arms licenses under arms act 1959:
If arms are possessed by the hospital or its employees (for example by security guards), a
license for the same should be available

Planning the Hospital Infrastructure:

One must take care of these things
 Qualifications of Doctors as well as their registration numbers
 Working hours for Nurses as well as their shift timings
 Medical equipment as well as instruments purchased
 Computers as well as other hardware devices set up
 Engineers as well as staffs required for maintenance, plumbing, medical gas pipelines, air
conditioning, etc.

The other important license required is:

1. Regulations Building Permit and Licenses (From the Municipality)
2. No objection certificate from the Chief Fire Officer "License under Bio-Medical
Management and Handling Rules, 1998.
3. No objection certificate under Pollution Control Act.
4. Narcotics and Psychotropic substances Act, 1985
5. Vehicle Registration Certificates (For all hospital vehicles.)
6. Atomic energy regulatory body approvals (For the structural facility of radiology dept,
TLD badges, etc)
7. Boilers Act, 1923(If applicable)
8. MTP Act, 1971 (MTP stands for Medical termination of pregnancy. To be displayed in the
Gynaec and Obs department)
9. License for the Blood Bank (To be displayed in the Blood Bank)
10. Transplantation of Human Organs Act 1994(If applicable)
11. PNDT Act, 1996 (PNDT stands for Prenatal diagnostics test. To be displayed in the
Radiology department that this is followed. )
12. Dentist Regulations, 1976
13. Drugs & Cosmetics Act, 1940
14. Electricity Act, 1998
15. ESI Act, 1948 (For contract employees)
16. Environment Protection Act, 1986
17. Fatal Accidents Act 1855
18. Guardians and Wards Act, 1890
19. Indian Lunacy Act, 1912 (Applicable only if a Psychiatry dept is there in the hospital)
20. Indian Nursing Council Act 1947 (Whether nurses are registered with NCI).
21. Also one must check whether pharmacists are registered with Pharmacy Council of India.)
22. Insecticides Act, 1968
23. Lepers Act Maternity Benefit Act, 1961
24. Minimum wages act, 1948 (For contract employees)
25. Pharmacy Act, 1948
26. SC and ST Act, 1989
27. Protection of Human Rights Act, 1993
28. Registration of Births and Deaths Act, 1969
29. Urban Land Act, 1976
30. Right to Information Act 2005

The Scenario of the Healthcare Sector in India:

o Healthcare industry comprises hospitals, medical devices, clinical trials, outsourcing,
telemedicine, medical tourism, health insurance and medical equipment.
o India’s healthcare delivery system is categorised into two major components - public and
private.
 The government (public healthcare system), comprises limited secondary and tertiary care
institutions in key cities and focuses on providing basic healthcare facilities in the form
of Primary Healthcare Centres (PHCs) in rural areas.
 The private sector provides a majority of secondary, tertiary, and quaternary care
institutions with major concentration in metros, tier-I and tier-II cities.
 Market Statistics:
o The Indian healthcare sector is expected to record a three-fold rise, growing at a CAGR
(Compound Annual Growth Rate) of 22% between 2016–22 to reach USD 372 billion in
2022 from USD 110 billion in 2016.
o In the Economic Survey of 2022, India’s public expenditure on healthcare stood at 2.1%
of GDP in 2021-22 against 1.8% in 2020-21 and 1.3% in 2019-20.
o In FY21, gross direct premium income underwritten by health insurance companies grew
13.3% YoY to Rs. 58,572.46 crore (USD 7.9 billion).
o The Indian medical tourism market was valued at USD 2.89 billion in 2020 and is expected
to reach USD 13.42 billion by 2026.
o Telemedicine is also expected to reach USD 5.5 billion by 2025.
What are the Challenges or Problems of the Health Sector?
 Inadequate Access:
o Inadequate access to basic healthcare services such as shortage of medical professionals, a
lack of quality assurance, insufficient health spending, and, most significantly, insufficient
research funding.
o One of the major concerns is the administrations' insufficient financial allocation.
 Low Budget:
o India’s public expenditure on healthcare is only 2.1% of GDP in 2021-22 while Japan,
Canada and France spend about 10% of their GDP on public healthcare.
 Even neighbouring countries like Bangladesh and Pakistan have over 3% of their
GDP going towards the public healthcare system.
 Lack of Preventive Care:
o Preventive care is undervalued in India, despite the fact that it has been shown to be quite
beneficial in alleviating a variety of difficulties for patients in terms of unhappiness and
financial losses.
 Lack of Medical Research:
o In India, R&D and cutting-edge technology-led new projects receive little attention.
 Policymaking:
o Policymaking is undoubtedly crucial in providing effective and efficient healthcare
services. In India, the issue is one of supply rather than demand, and policymaking can
help.
 Shortage in Professionals:
o In India, there is a shortage of doctors, nurses, and other healthcare professionals.
o According to a study presented in Parliament by a minister, India is short 600,000
doctors.
 Paucity of Resources:
o Doctors work in extreme conditions ranging from overcrowded out-patient
departments, inadequate staff, medicines and infrastructure.
What is the Potential or Prospects of the Indian Health Sector?
 India's competitive advantage lies in its large pool of well-trained medical professionals.
India is also cost competitive compared to its peers in Asia and western countries. The cost
of surgery in India is about one-tenth of that in the US or Western Europe.
 India has all the essential ingredients for the exponential growth in this sector, including a
large population, a robust pharma and medical supply chain, 750 million plus
smartphone users, 3rd largest start-up pool globally with easy access to VC (Venture
 Capital Fund) funding and innovative tech entrepreneurs looking to solve global healthcare
problems.
 India will have about 50 clusters for faster clinical testing of medical devices to boost
product development and innovation.
 The sector will be driven by life expectancy, shift in disease burden, changes in
preferences, growing middle class, increase in health insurance, medical support,
infrastructure development and policy support and incentives.
 As of 2021, the Indian healthcare sector is one of India’s largest employers as it employs a
total of 4.7 million people. The sector has generated 2.7 million additional jobs in India
between 2017-22 -- over 500,000 new jobs per year
What are the Initiatives for the Health Care Sector?
 National Health Mission
 Ayushman Bharat.
 Pradhan Mantri Jan Arogya Yojana (AB-PMJAY).
 National Medical Commission
 PM National Dialysis Programme.
 Janani Shishu Suraksha Karyakram (JSSK).
 Rashtriya Bal Swasthya Karyakram (RBSK).
What is healthcare marketing?
Healthcare marketing is a process of strategic outreach and communications built to bring
in new healthcare consumers, shepherd them through their healthcare journey, and keep
them engaged with the healthcare system, service, or product.
Today, virtually every type of healthcare business markets, including health systems,
hospitals, multilocation providers, solo practices, pharmaceuticals, medical device
manufacturers, health plans, consumer brands, and more.
When done properly, healthcare marketing:
 Enhance the patient experience
 Keep healthcare consumers engaged with relevant, personalized, and timely outreach
during their journey
 Empower consumers to make smarter, healthier decisions, leading to better outcomes for
healthcare brands and consumers
 Increase your consumer base, retain existing consumers long-term, and improve loyalty in
your healthcare community
 Drive more qualified leads and generate more revenue
 Increase local physician referrals
 Position your physicians as thought leaders in their market
 Evaluate your productivity and re-align the strategy
 Increase your strategic advantage to attract healthcare consumers in an increasingly
competitive marketplace
 Improve your online reputation
 Build your brand
Rapid changes in the healthcare industry markets require agility and focus. You may need
to hire a marketing agency and plan for a larger budget than you have in the past. But in
 the end, it’s worth it for that peace of mind—and to see your bottom line grow faster than
ever before.
Healthcare Marketing Strategies to Attract Today's Healthcare Consumer
1. Use consistent healthcare branding
You might feel confident your expertise sets you apart from other healthcare providers or
businesses. But let’s face it—to a healthcare consumer, one white coat looks just like the
next, and consumers are famously unwilling to buy a product or service from someone they
don’t know and trust.
When you build a strong and recognizable brand and promote awareness of it, you go a
long way towards reducing your overall cost-per-acquisition and growing your ROI.
2. Evaluate the online patient experience
Twenty years ago, simply having a website was enough to impress prospective healthcare
consumers and help them find your healthcare brand identity.
Today, consumer engagement has become increasingly complex as the healthcare industry
shifts more readily into virtual care experiences, like telehealth and remote monitoring.
A website is your organization’s front door. It’s often the first thing consumers see; if it’s
not optimized, it may also be the last time a person considers your hospital or healthcare
practices.
3. Build a responsive healthcare website
A responsive website automatically adjusts to the size of a screen, so the experience is the
same whether the site is accessed from a computer, tablet, phone, or another mobile device.
It’s the norm in website design today—but more than that, it’s something search engines
look for when crawling any medical website to determine how and where you’ll rank.
4. Test site speeds
Healthcare marketers who study user (prospective healthcare consumer) behaviors online
have proven that consumers are less willing to put up with slow loading times than ever
before. It only takes 5 seconds to lose a prospective consumer.
What’s more, poor site speed may cause your medical or healthcare website to fall in the
search engine results. You can test your site speed using Google’s PageSpeed Insights.
5. Optimize organic search engine results for prospective healthcare consumers
Search engine optimization is a powerful tool for getting your medical practices or hospital
network to the top of the search engines. However, it’s a lot more complex than most people
realize.
You cannot simply use the term “orthopaedic surgeon” 100 times throughout your website
and hope to rank #1 on Google among all doctors, physicians, and surgeons providing
healthcare services in your area
This is only the beginning of marketing best practices for healthcare SEO, which also
include:
 Developing content pages full of high-quality information and optimized with your
keywords.
 Having internal links pointing back to relevant pages on your website.
 Gaining external backlinks from reputable health sites.
 Managing your site index or sitemap (making it easy for search engines to read and rank).
 Claiming your healthcare website on Google Business Profile and complete your business
listing with complete, accurate information.
o Fill out every available section for each location
6. Use PPC and display ads for healthcare marketing
Search Engine Optimization (i.e., “Healthcare SEO”) is an organic marketing strategy used
to earn a healthcare system, hospital, or practice greater visibility online.
However, even if your site ranks number one organically, for a search term like “surgeon
in Tulsa,” there are still 3 or 4 paid advertisements above your organic web page that people
will see first.
PPC (pay-per-click), or paid search advertisements, are laser-targeted to appear first on
the search engine results page (SERP) for a set of search terms. You can manage your
budget with paid search and decide how much you'd like to spend to keep your site at the
top of SERPs. Your return on investment is clear and defined with both PPC and display
ads that appear on the sidebar or top of other websites.
7. Leverage social media (the right way)
Too many hospitals and healthcare practices rely solely on organic social media for a large
part of their digital healthcare marketing strategies. Organic social media means posting
photos, updates, events, etc., directly to Facebook, Twitter, or YouTube. It's a valid brand-
building strategy and lets healthcare consumers know what's new.
Paid social media is about more than pressing the “Boost Post” button that appears when
you post from your business page. Like PPC or display advertising, it involves strategizing
and budgeting to target the audience you want.
8. Ask for reviews from healthcare consumers
Consumers want to see that others like them have had a good experience before scheduling
their visit. Online reviews continue to gain credibility for potential and current
patients. 86% of 1,124 US-based consumers surveyed trust online reviews as much as
personal recommendations and believe they’re a reliable resource when choosing a new
physician.
Typically, healthcare consumers only leave reviews when motivated to do so (e.g., if
they've had an above-average or extremely poor experience). Unless you’re proactively
asking for reviews, you’re missing out on opportunities to feature positive consumer
feedback.
While there are many good options out there, our agency provides clients with a highly
scalable platform that offers the three most vital functions:
1. Review solicitation: Most review/rating sites allow you to ethically solicit reviews from
healthcare consumers and patients, so long as you don't artificially "stack the deck." Your
platform should allow you to request reviews at scale through text and email or on a one-
on-one basis through QR codes, tablets, and individual text messages. Your platform can
direct patients to websites like Google and Facebook and generate first-party reviews for
your website.
2. Review monitoring: While review monitoring for a single location is pretty manageable,
it can be a nightmare for multilocation providers. What’s more, without the proper
software, you will likely miss both good and bad reviews on dozens of rating sites.
3. Review responses: Your platform should also allow you to respond to online reviews
easily. (More on this in a moment.)
Note: All client communications need to be empathetic and HIPAA compliant. Also, be
sure never to post or buy fake third-party reviews.
9. Follow up with consumer feedback in your marketing efforts
If a healthcare consumer shares a poor opinion of your practice on outside review sites
such as Google, Facebook, and Yelp, you need to respond and show that you’re working
to resolve the problem. With the proper follow-up, consumers may be motivated to update
their reviews to let others know you resolved the issue quickly.
Reputation management should be a part of any healthcare marketing strategy, but this
doesn't mean you should get defensive about negative reviews. Instead, look at them as
learning experiences and upgrade processes and equipment as needed to ensure the best
possible patient experience moving forward.
10. Look into traditional media options
Many healthcare businesses are reluctant to invest in external media opportunities:
traditional advertising sources like radio, television, billboards, and newspapers. These can
be significant investments, so you must be careful where you spend your money to see the
best, tangible results.
11. Build physician referrals into your medical marketing plans
How does your practice reach potential referring doctors? If you’re not using a physician
liaison, you’re not getting what you need. Doctor referrals are some of the
best organic marketing strategies for bringing in new healthcare consumers. To ensure
you’re receiving as many doctor referrals as possible, you or your physician liaison must
be proactive and exercise best practices in professional communications and relationships.
UNIT -IV
HOTEL INDUSTRY
What is a Hotel?
Broadly speaking, a hotel is a managed building or establishment which provides guests
with a place to stay overnight – on a short-term basis – in exchange for money. The precise
features and services provided to guests can vary quite drastically from one hotel to
another. Hotel owners aim to attract a particular type of customer through their pricing
model and marketing strategy or via the range of services they offer.
What is The Hotel Industry?
Next, it is important to answer the question: what is the hotel industry? Put simply, the
hotel industry is the section of the service industry that deals with guest accommodation or
lodgings. By most definitions, the hotel industry refers to hotels and many other forms of
overnight accommodation, including hostels, motels, inns, and guest houses. However, it
does not usually include long-term or permanent forms of accommodation.
Due to the nature of hotel services, it is closely associated with the travel and tourism
industry.
The Difference Between the Hotel Industry and the Hospitality Industry:
One common area of confusion concerns the difference between the hotel and the
hospitality industry, with many people mistakenly believing the two terms refer to the same
thing. However, while there is a cross-over, the difference is that the hospitality industry is
broader in scope and includes multiple different sectors.
The hotel industry is solely concerned with providing guest accommodation and related
services. By contrast, the hospitality industry is concerned with leisure in a more general
sense. As a result, it covers accommodation, restaurants, bars, cafés, nightlife, and many
travel and tourism services.
Different Types of Accommodation in the Hotel Industry:
It is important to understand that the hotel industry is a catch-all term to describe guest
accommodation services. With that in mind, it is worth noting that a variety of different
accommodation types fall under this umbrella term. Some of the main types are described
in more detail below:
Hotels:
The most common type of accommodation in the hotel industry, a hotel is defined as an
establishment that offers overnight accommodation, meals and other services. They are
mainly aimed at travelers or tourists, although locals may also use them. Hotels provide
private rooms and almost always have en-suite bathrooms.
Bed and Breakfasts:
Bed and breakfasts, or B&Bs, are smaller establishments offering guests private rooms for
overnight stays and breakfast in the morning. Often, these establishments are converted
from private homes, and many B&B owners live on their property. While they are often a
budget option, high-end or luxury B&Bs exist.
Motels:
Motels are a form of overnight accommodation tailored towards motorists. For this reason,
they are typically located conveniently by the roadside and offer ample free parking. A
motel will generally have a number of guest rooms and may have some additional facilities
but will usually have fewer amenities than hotels.
Botels:
‘Botel’ is the name given to a boat that has been adapted to offer hotel-style lodgings. Many
botels are permanently moored riverboats, although others are converted ships, which can
travel with guests onboard. They are especially popular in European cities with rivers or
canals.
Inns:
An inn is an establishment that provides temporary accommodation, usually along with
food and drinks. Inns are smaller than hotels and are closer in size to bed and breakfasts,
although inns are often slightly larger. Guests are allocated private rooms; food options
usually include breakfast and dinner.
Resorts:
Resorts are commercial establishments, usually consisting of a hotel and a variety of on-
site services and amenities. Guests will usually have access to lodgings, restaurants, bars,
entertainment options, recreational activities, and shops, which can all be accessed without
leaving the premises.
Serviced Apartments:
Popular among business travelers, serviced apartments are apartment-style lodgings, where
guests benefit from a full range of services, such as room service, housekeeping and
laundry services. Most serviced apartments also offer additional amenities, while the
apartments tend to be larger than most hotel rooms.
Hostals:
Often confused with hostels, a hostal is a form of accommodation primarily found in
Spanish-speaking regions. They resemble a budget hotel, offering either private bedrooms
or apartments, while they may also have a bar, restaurant and/or café. Most hostals are
family-owned, and guests may sometimes share bathrooms with others.
Hostels:
A hostel is a form of accommodation, typically aimed at those on a budget, where multiple
guests sleep in different beds in the same living space. Effectively, guests pay for a bed,
rather than a private room, and hostels hold a particular appeal for those looking to meet
new people. Guests will usually share kitchen and bathroom facilities.
Apartment Hotels:
An apartment hotel is essentially an apartment building that operates hotel-style services.
It provides a similar experience to renting an apartment, albeit with the option to check-in
and check out on-demand rather than signing a fixed-term contract. These hotels will
generally also provide basic housekeeping services.
Boutique Hotels:
Often promoted based on aspiration and luxury, boutique hotels are hotels situated within
relatively small buildings. In most instances, they provide guests with upmarket rooms and
high-quality services. They often have a particular theme and are commonly found in
trendy urban areas.
Condo Hotels:
A condo hotel is a condominium building that operates as a hotel, allowing guests to rent
a condominium unit for a short period. They are almost exclusively found in cities, are
especially popular in the United States, and combine the holiday home experience with
hotel-style service features.
Eco Hotels:
The basic definition of an eco-hotel is a hotel, which has taken steps to embrace sustainable
living practices to minimize the environmental damage they are responsible for. They may
prioritize the use of local products, adopt recycling measures, focus on energy saving, and
use sustainable bed linen and towels.
Guest Houses:
Typically, a guest house is a private house, which has been converted to provide guest
lodgings. It is common for the guest area to be kept completely separate from another area,
where the owner may live. Some guesthouses provide additional services, but many are
operated on a self-service basis.
Holiday Cottages:
A holiday cottage, also known as a holiday home, is simply a cottage or small house left to
people temporarily for holiday purposes. Essentially, a guest pays to use the property for a
short period of time. They are especially common in the UK, US, and Canada, and a key
advantage is the freedom they offer guests.
Pensions:
Pensions are a form of the guest house, similar to bed and breakfasts, while providing more
meals throughout the day. In most cases, guests have an option of different plans, such as
full board, where they get breakfast, lunch, and dinner, or half board, where they may get
breakfast and dinner, without the lunch.
Pop-Up Hotels:
A pop-up hotel is a name given to a hotel that is housed within a non-permanent structure.
Typically, pop-up hotels exist for a short period of time only. They are most commonly
associated with outdoor events, but pop-up hotels may also be established for a particular
time of year, such as Christmas or the summer.
Roadhouses:
Finally, roadhouses are relatively small establishments situated next to a road to attract
passing customers. In some ways, they combine the features of a motel, B&B, and inn.
They often offer several private guest rooms, similar to a B&B, and may also have a
restaurant and/or a bar.
Significance of Star Ratings in the Hotel Industry:
Within the hotel industry, star ratings are used to measure the quality of hotels. Although
there is no international standard for defining what star ratings mean, the most popular
version of this system is associated with the Forbes Travel Guide, where hotels are rated
based on established criteria.
Star ratings carry huge significance within the hotel industry because so many customers
take the time to research hotels before making a booking. Although word of mouth and
feedback from other customers is important, star ratings can carry extra weight because
evaluators have experience with many different properties.
The significance of hotel star ratings is further highlighted by the steps that those in the
hotel industry take to achieve higher ratings, and this is for a good reason. Moving up a
star rating can help hotels to generate more bookings and charge higher rates, while moving
down can have the exact opposite effect.
You can learn more about how star ratings work, how they can influence customers, and
view a breakdown of what each star rating means by reading “The Hotel Star Rating
System: Types, Benefits, Significance, Examples”.
Hotel Marketing Trends and Strategies
Hotel marketing is crucial in helping owners maximize bookings and revenue. After all, it
is the main way in which those in the hotel industry can reach out to potential guests,
conveying their unique selling proposition, brand values, and why guests should choose to
stay with them. Do you want to learn more about hotel marketing? In the articles “The
Latest Hotel Marketing Trends in the Hotel Industry” and “Essential Hotel Marketing
Strategies,” you find the latest hotel marketing trends and strategies.
TOURISM VS HOTEL INDUSTRY:
Tourism and hospitality or hotel are related but distinct sectors within the travel and leisure
industry. Here are the key differences between the two:
1. Focus and Scope:
o Tourism: Tourism is a broader concept that encompasses the entire travel experience,
including transportation, accommodation, attractions, and activities. It involves people
traveling to and staying in destinations for leisure, business, or other purposes.
o Hospitality: Hospitality or hotel specifically refers to the provision of services and
amenities to guests or travelers within the tourism industry. It primarily involves
accommodation, dining, and other services that ensure the comfort and satisfaction of
guests.
1. Components:
o Tourism: Tourism includes various components, such as transportation (e.g., airlines,
trains, buses), accommodation (e.g., hotels, resorts, vacation rentals), attractions (e.g.,
museums, theme parks, landmarks), and tour operators.
o Hospitality: Hospitality or hotel is primarily concerned with the accommodation sector
(e.g., hotels, motels, hostels, bed and breakfasts), food and beverage services (e.g.,
restaurants, cafes, bars), and other guest-focused services (e.g., spa, concierge, room
service).
1. Nature of Services:
o Tourism: Tourism services are diverse and can involve transportation, tour planning,
ticketing, and organizing various activities and experiences.
o Hospitality: Hospitality or hotel services are primarily focused on providing a comfortable
and pleasant stay for guests, including room accommodations, food services, and
amenities.
1. Customer Interaction:
o Tourism: While tourism involves interaction with customers, it may not be as direct and
constant as in the hospitality sector.
o Hospitality: Hospitality or hotel businesses have continuous and direct interaction with
guests, often aiming to create a positive and memorable experience.
1. Examples:
o Tourism: Tour operators, travel agencies, and tourist attractions like museums and natural
parks fall under the tourism category.
o Hospitality: Hotels, restaurants, cruise lines, and resorts are examples of businesses in the
hospitality sector.
So, tourism is a broader concept that encompasses various aspects of travel and leisure,
including transportation and attractions, while hospitality focuses specifically on providing
services and accommodations to travelers to ensure a comfortable and enjoyable
experience during their journeys.
Hotel Supportive Services:
1.Room Division:
The room division comprises departments and personnel essential to providing the
services guest expect during a hotel stay. In most hotels, the rooms division generates more
revenue than all other divisions combined. The front office is one department within the
rooms division. Others are housekeeping, uniformed services, and the concierge. In some
properties, the reservations and switchboard or telephone functions are separate
departments within the rooms division. Figure at previous page shows a sample
organization chart for the rooms division of a large hotel.
2.The Front Office:
This is the most visible department in a hotel. Front office personnel have more
contact with guest than do staff in most other departments. The front desk is usually the
focal point of activity for the front desk to register; to receive room assignments, to inquire
about available services, facilities, and the control center for guest requests concerning
housekeeping or engineering issues. Foreign guest use the front desk to exchange currency,
find a translator, or request other special assistance. In addition, it may also be base of
operations during an emergency, such as a fire or a guest injury. The functions of the front
office are to: 1. Sell guestrooms, register guests, and assign guestrooms. 2. Process future
room reservations, when there is no reservation department or when the reservation
department is closed. 3. Coordinate guest services.
3.Reservations:
More than half of all hotel guests make reservations. These individuals arrange for
hotel accommodations through such means as toll-free telephone numbers; direct telephone
lines; hotel sales representatives; travel agencies; property-toproperty networks, postal
delivery; telex and fax; e-mail; internet; and other communications services.
4.Uniformed Service:
Employees who work in the uniformed service department of the hotel generally
provide the most personalized guest service. Given the high degree of attention awarded
guest by this department, some properties refer to uniformed service simply as guest
service. Among the primary positions within the uniformed service department are:
1. Bell attendant – persons who provide baggage service between the lobby area
and the guestroom.
2. Door attendants – persons who provide curb-side baggage service and traffic
control at the hotel entrance.
3. Valet parking attendants-persons who provide parking service for guest‘s
vehicles.
4. Transportation personnel – persons who provide transportation service for
guests.
5. Concierges – person who assist guest by making restaurant reservations,
arranging for transportation, and getting for tickets for theater, sporting, or other special
events, and so on.
5.Housekeeping:
Housekeeping is perhaps the most important support department for the front
office. Like the front office, housekeeping usually is part of the rooms division of the hotel.
In some hotels, however, the housekeeping function is considered an independent hotel
division.
6.Food and Beverage Division:
The hotel‘s food and beverage division generally ranks second to the rooms
division in terms of total revenue. Many hotels support more than one food and beverage
outlet. There are almost as many varieties of hotel food and beverage operations as there
are hotels. Possible outlets include quick service, table service, and specially restaurants,
coffee shops, bars, lounges, and clubs. The food and beverage division also typically
supports other hotel functions such as room service, catering, and banquet planning,
Banquets, normally held in the hotel‘s function room, may represent tremendous sales and
profit opportunities for the food and beverage division.
7.Sales and Marketing Division:

The size of a hotel‘s sales and marketing staff can vary from one part time person
to more than a dozen full-time employees. In smaller properties, the general manager often
serves in all the sales and marketing roles. In larger hotels, the sales and marketing
responsibilities are typically divided into four functions: sales, convention services,
advertising, and public relations. The primary goal of the division is to promote the sale of
hotel products and services.
8.Engineering and Maintenance Division:
A hotel‘s engineering and maintenance division is responsible for maintaining the
property‘s structure and grounds, as well as electrical and mechanical equipment. This
division may also be charged with swimming pool sanitation, parking safety equipment
comes under this division as well. The front office must efficiently exchange information
with a representative of the engineering and maintenance division to ensure guest
satisfaction. A guest complaint about a leaky faucet, malfunctioning lamp, or sticking lock
should not rest with a front desk agent but should be written up and quickly relayed to
engineering and maintenance staff for corrective action. Conversely, front desk staff must
be informed quickly about maintenance problems that render a room unsuitable for sale.
They also must be informed when the room becomes ready for sale again.
9.Security Division:
A hotel‘s security program is strongest when employees outside the security
division participate in security efforts. For example, front desk agents play a critical part
in key control by issuing room keys to registered guests only.
10.Other Divisions:
Many hotels staff a variety of other divisions to serve the need of their guests. The
range of possibilities reflects the diversity of hotels. Retail Outlets: Lodging properties
often establish gift shops, newsstand, or other retail outlets in their lobbies or public areas.
Recreation: Some hotels – primarily resort – staff a division dedicated to providing group
and individual recreational activities for guests. Some recreation divisions also undertake
landscaping, the grounds and maintaining the pool., golf, tennis, bowling, snorkeling,
sailing, walking tours, bicycle trips, horseback riding, hikes, and other activities may be
arrange by recreation division staff. Casino: Casino will have a casino division that
operates games of chance for guest and protects the property‘s gambling interests.
Accommodation Management:What is a property or Accommodation management
system?
A property management system (PMS) is software that facilitates a hotel’s reservation
management and administrative tasks. The most important functions include front-desk
operations, reservations, channel management, housekeeping, rate and occupancy
management, and payment processing. Although PMS software mostly controls
reservation and financial transactions, it may allow you to manage housekeeping and
perform human resources management as well. In general, PMS facilitates the main
processes in a hotel related to internal and external operations.

Hotel Property Management System (PMS): Functions, Modules & Integrations

The first hotel property management systems were introduced back in the 1970s. But, even
today, not every hotel has one. Adam Harris, CEO of Cloudbeds, mentioned the low tech
adoption rate in his recent interview with Skift. “The average percentage of spend for
technology in the hotel industry is like a fraction of what it should be,” Harris said. He also
elaborated on the reason behind such a situation: “The number one reason why we don’t
sign a customer up is not because they went to a competitor of ours; it’s because they’re
afraid of the change.”

However, technology innovations have found their way into the hospitality industry. In
2015, a report “Hotel Management Software BuyerView” by Software Advice showed that
only 34 percent of hotels used special software, while 25 percent still relied on pen and
paper only to manage their hotels, and 16 percent had no hotel management system at all.
Today, according to the Stayntouch 2022 Technology Sentiment Report, 81.7 percent of
hotels have implemented at least one type of technology during the pandemic.

Hoteliers started looking for innovative solutions such as self-service check-in, in-room
controls, mobile keys, and digital payments. Many big players have already
implemented smart technologies based on the Internet of Things infrastructure. But there
are still a lot of legacy systems in use.

Legacy PMS software may perform just one function, require additional modules, or be
too hard to integrate with other necessary hotel management software. Consequently, hotel
owners are looking for a universal, one-and-done solution to manage all the processes.
Over 80 percent of respondents to the 2022 Hotel Technology Survey reported that they
want to learn more about technology.

Currently, hotel property management systems are used by big hotel chains, small hostels,
and everything in between. With these systems, hotels can see the booking status of rooms
and control reservations. However, their functionality doesn’t end here. Via PMS, hoteliers
can manage back-office processes, food and beverage services, and track room occupancy
rates. Let’s take a closer look at the most common functions supported by PMS.
Main modules of property management systems
A modern property management system combines multiple work environments in a single
piece of software. Depending on the provider, the combination of modules and functions
can vary, and the functionality of one module can be slightly different. Additionally, some
vendors sell their systems in separate modules that can be integrated with an existing
solution used by a hotel. Here is the basic structure of a hotel PMS.
 A general structure of property management system
Keep in mind that it is hard to divide the functions of PMS into more and less important
because all of them are necessary. However, regardless of a property type, hotel property
management systems must have a reservation system with a website booking engine and
front-desk operations module. Other essential modules usually include channel
management, revenue management, housekeeping, customer data management, report, and
analytics. And big hotels or resorts certainly need point-of-sale (POS) services and back-
office modules.
Reservation
For a modern hotel business, online bookings are in most cases the main sales channel. The
reservation module, which helps manage online bookings, effectively becomes
indispensable to a property management system. A central reservation system (CRS) or
any other reservation platform may be available as a separate module of PMS or
implemented as a hotel’s separate internal solution.

A hotel reservation system holds all inventory data and dates, sending this information to
the front desk. The reservation system must be integrated with the website booking engine
and other distribution channels. Chain hotels usually have one central reservation system
for all properties, while independent hotels have their own reservation systems. If a hotel
or a hotel chain already uses a particular reservation software, PMS must offer integration
with the existing service.

Key functions of the reservation module include:

 Room bookings. The system checks room availability and status, shows free rooms across
different channels and the website booking engine. This function monitors double bookings
 and allows group reservations. Then it schedules bookings and displays information about
current and upcoming bookings on a dashboard.
 E-payments processing. Software collects online transactions and classifies them
according to their types and categories.
 Management of room inventory and allocation. Reservation tools prevent overbookings
and double bookings. In some software, this function is part of a channel management
module.
 Reservation emails. The system sends confirmations to guests after they complete their
booking. In some PMSs, this function is a part of the front-desk operations module.
 Activities booking. Some software allows guests to book not only accommodation but also
activities with this system.
Front-desk operations and room management
A front-office module allows a front-desk manager to view and update room reservation
status, check guests in and out, and process payments. When a guest arrives at the hotel,
they want to check in as fast as possible. Support from a receptionist is very important in
this case, so front-desk staff should be able to efficiently help the guest.

Some property management systems also offer integration with self-service check-in
kiosks or allow checking in or out via QR code. To get a better idea of check-in automation,
have a look at how Marriott and other businesses leverage digital self-services in travel.

Room status. Using a front-desk module, the front-office manager can access room status
and up-to-date information about all reservations, both current and upcoming. With the
help of this module, room status should be updated quickly. The front-desk module
allocates rooms automatically and facilitates a room change.

Keys management. This module includes management of electronic key cards, processing
payments and issuing receipts to guests.

Daily audits. The front-office module also allows users to perform night and shift audits.

In-room controls. As hotels become smarter and more tech-driven, room management
gains more importance since this module also helps operate the in-room automated systems
(e.g., lights, HVAC, etc.) remotely to make the room ready for a guest’s arrival.

Channel management
Channel management software is a single interface to control and distribute inventories
across different channels such as GDSs, OTAs, wholesalers, direct booking platforms, etc.
A channel manager connects directly to a central reservation system that holds information
about the availability and cost of hotel rooms, sharing this information via the distribution
channels. It makes room inventory available to travelers who want to book a room or
property online, listing rooms on different sources. Also, a channel management module
facilitates booking-related transactions.
Different distribution channels expose inventory to different audiences. For example,
connection to OTAs and some airline websites allows a larger number of potential guests
to be reached, those who book flights or plan trips in advance. Metasearch sites compare
prices across different channels, letting a customer make the best decision. Connections to
GDSs assist non-leisure traveler booking as well as group reservations.
Direct distribution via booking engine
An important channel of distribution is a hotel's own website with a booking engine. An
online booking engine allows travelers to complete reservations directly via a hotel website
bypassing travel agents and OTAs.

It’s important to allow loyal guests to book directly, and website booking must be available
to those who find a hotel online. A booking engine must be synchronized with the hotel
website and its central reservation system, making it an additional sales channel. Usually,
this module processes payments via integrated payment gateways.

In addition, booking engines often support upselling (offering room upgrades or

complementing services) and packaging.
Revenue management
A PMS in and of itself is a big step towards improving hotel revenue management
indicators, such as Occupancy, RevPAR (Revenue per Available Room),
and ADR (Average Daily Rate), which mean a lot in evaluating a hotel’s financial success.
While GDS and OTA integration helps maximize these rates, revenue management
systems help a manager understand how to adjust the processes to achieve better results
and control finances.

As studies prove, the majority of hoteliers realize the importance of revenue management.
2022 research by tech provider Duetto showed that 67.6 percent of respondents currently
use a revenue management system and 77.6 percent expect their hotel tech investments to
increase in the next three years.

The revenue management module of the PMS helps increase total room revenue using
machine learning to forecast occupancy rate and decide whether to raise or lower inventory
prices.

It also enables dynamic pricing. Using algorithms, this module helps hotels price the rooms
based on historical data about past reservations as it monitors competitors’ rates, weather
data, and local events. It improves pricing strategies, and updates prices across all
distribution channels to sell more rooms at the optimal rate. To learn more about revenue
management read our article on how machine learning redefines revenue management in
the hotel industry.
Housekeeping
 A PMS housekeeping module connects housekeeping staff to the front office. A front-
office manager can make a list of tasks to assign, and housekeepers can update room status.
If this is a cloud-based PMS, housekeepers can update the status of their assignments or
rooms through a connected mobile app or tablet. Also, this module keeps the list of
maintenance tasks and reports for the users.

The main function of this module is housekeeping management and property maintenance.
Housekeeping functionality includes room status management, maid assignment for room
cleaning based on a block or floor location, and keeping lists of tasks for housekeepers.
Maintenance management keeps the record of hotel disruptions and repair activities with
the further assignment of an attendant who can eliminate a problem.
CRM and customer data management
It is critical for hoteliers to collect and organize guest data to keep in touch with current
and past customers during and after check-out. The CRM module must integrate with the
front desk and reservation system, collecting all guest information from these sources. It
helps store guest data and provides a database in an accessible format. Also, it includes
guest contact information before and after their stay. However, if a hotel already has its
own CRM system, the PMS should integrate with it.

This module can also help organize marketing activities such as promotions, measure guest
experience, and automate pre- and post-stay services. The CRM module helps owners
personalize the guest experience with membership and loyalty programs, which are
especially important for hotel chains and resorts.
Reports and analytics
To monitor current processes and understand business performance, all business owners
rely on analytics. A PMS can serve as a business intelligence tool, collecting relevant hotel
data and providing hoteliers with various types of automated reports. Depending on the
software, it can generate night audit reports, room and tax reports, shift audit reports,
departure/arrival reports, housekeeping reports, or other ongoing summaries.
Back-office management
This PMS module facilitates management of a hotel team, back-office operations, and
administrative hotel operations. Functions of a back-office management module may
include
 Event management (conference and reception organization) and catering,
 Spa and gym management (sometimes it’s a separate, optional module),
 Staff management (human resources management in back and front office: shift
management, staff invoicing, etc.),
 Consumption costs and hotel spendings analysis,
 Inventory analysis,
 Sales and management of promotional campaigns, and
 Reviews management.
So the back-office module facilitates internal operations, helps organize staff, and often
includes accounting and other financial-related functionality.
 Point-of-sale services
Most hotels have some kind of in-house restaurant, not to mention properties with gyms
and spas. So, if there are multiple payment terminals in a hotel, the point-of-sale (POS)
system is indispensable to collect and accurately handle transactions from different
sources. With a POS module in their PMS, hoteliers can include additional charges or
discounts on the final bill for each customer. Some examples of such charges are
 Spa, gyms, and other activities;
 Food and beverage services (restaurants, cafes, breakfasts); and
 In-room services, mini-bar items, TV, or Wi-Fi.
In addition to automated payment processing, a comprehensive POS module can support
inventory management, collect information about customer purchasing patterns, generate
sales activity reports, and keep financial data in one place.
The choice of a PMS depends on the size and type of a hotel property, as different systems
have their own sets of core features and additional modules. Most players in the market
offer hotel management systems that can be customized for different types of property and
basic PMS components can be complemented with modules, required for a specific type of
business.

Many properties already have reservation platforms or CRSs of their own, or utilize other
business management software, so it is very important for the selected PMS to be integrable
with third-party products. The final choice of a property management system for a hotel is
largely shaped by the functionality required.

The 2021 Smart Decision Guide to Hotel Property Management Systems by Oracle
provides an evaluation checklist to help hoteliers make the right decision, scaling each
factor from 1 (absolutely not important) to 10 (very important). This checklist is also very
useful for comparing systems by different vendors. Regardless of hotel size and type,
consider the following:
The Evaluation Checklist. Source: The 2021 Smart Decision Guide for to Hotel
Property Management Systems
Check integration options. If there are systems already used by a hotel, or if you plan on
integrating additional software, make sure that your vendor supports all
necessary APIs and is ready to provide integration services. Otherwise, you may consider
an external technical consultant to provide integration services.

Consider a cloud solution with mobile access. Cloud solutions are generally less
expensive than on-premises software, and an owner doesn`t need to pay maintenance fees.
Users of cloud software pay a subscription fee depending on the number of rooms in a hotel
and modules they need. Also, cloud software is better at integrating with third-party
systems like OTAs and GDSs.
On top of that, cloud-based systems can be constantly and seamlessly updated, and usually
have a mobile version. Mobile access facilitates communication across departments (front-
office, management, housekeeping, etc.) which helps improve customer service.
 Mobile interface of a hotel PMS. Source: eZee Absolute
Prioritize the ease of use. The system’s UX will impact your employees’ learning curve.
The more complex and unintuitive the interface is, the more time you have to invest in staff
training and transitioning.

Pay attention to the degree of customization offered by a provider. Depending on the

size and type of a property, PMS requirements may differ. For instance, if you need a bed-
based management system instead of room-based in the front-office module, make sure
that the PMS vendor can provide this sort of customization.

Assess customer support. Anything can happen to software, but it mustn’t affect the hotel
service. Hoteliers need 24/7 access to technical support. When choosing a PMS, look for
customer support reviews from fellow hoteliers or negotiate all support terms with your
vendor in detail to ensure that any software outages won’t have a dramatic impact on your
operations.

Calculate ROI and spendings. Whether you want to update an existing property
management system, build a custom one, or buy an off-the-shelf solution, you need to
decide how much you’re ready to spend on it. To make sure that the PMS will pay off,
consider these key factors:
 time currently spent and how it will be reduced as a result of automation;
 how distribution and revenue will change; and
 cost of system integration and maintenance.
There are plenty of vendors who sell off-the-shelf PMSs and those who provide
customization services. Trying to reach a broader audience, big vendors supplement and
customize the basic PMSs so that they can be used by as many types of properties as
possible. Let’s have a look at the solutions across different categories.

Please note that most systems already have channel management, reservation, and front-
office functionality, so these modules are not represented in some of the comparison tables
below. Also note that the categorization we offer is not absolutely precise since most
platforms today are becoming more and more universal.

We’ve explored some of the popular PMS products but since we can’t describe all of them
in detail in this post, we’ve compiled comparison tables and discussed several solutions to
give you the idea of what to expect.
Property management systems for hotel chains and resorts
Larger properties require solutions with a wide range of modules other than the basic
reservation, front office, and housekeeping. Their PMS must facilitate group bookings as
well as have POS services, a multi-property management system, back-office management,
revenue management, sales, and marketing functionality.

Vendors cater to the needs of large properties, adding special modules like golf and spa
management. Hotels that host MICE can choose a solution that has event management and
catering functionality included. Also, owners of big properties should consider PMSs with
capabilities that automate check-in and checkout and offer other self-service tools.

We looked at such renowned, comprehensive tools as Oracle, 5stelle*, Clock

PMS, Maestro, and others. All of them are designed to streamline operations of big hotels
and hotel chains but can also be tailored to fit the needs of independent properties.

Please note that most products are highly customizable and modular. So, when purchasing
such a solution, you can choose the components you need and pay only for what you
selected.

Property management systems for hotel chains and resorts

Maestro PMS is a multi-property management system with 20+ modules that can be
integrated into one interface. The system provides open API (supporting over 800 third-
party integrations) and GDS/OTA integration. The product is positioned as a guest-
centered PMS for chain and independent hotels, resorts, and vacation rentals.

Maestro PMS is available both as a Windows app and a web browser application. It also
has mobile apps for guests and hotel staff. Here’s a brief description of Maestro’s key
functionality modules.

Front desk operations and CRM. This module connects reservation, housekeeping, spa,
activities, sales, and guest relations management functionality in a single environment.

Sales and catering. This component supports group and event management offering
multiroom operation and guest management capabilities. It facilitates sales and helps keep
track of all aspects of event management, conference planning, and scheduling.

Revenue management. Maestro PMS has the Analytics & Business Intelligence data
mining module for budgeting, forecasting, marketing, and reporting.

Spa and activities. This PMS has several modules for managing resorts, including Spa
Management and Activities & Facilities Management that offer mobile solutions for
guests, allowing them to schedule services.

Guest experience management. Maestro’s Guest Experience Management module, or

GuestXMS, is focused on collecting and responding to guest feedback. It offers diverse
chat options, post check-in and post checkout surveys, feedback analysis, and so on.

Other modules Maestro offers to hotels include Multi-Property Management,

Housekeeping, Work Order, Guest Loyalty, Online Booking Engine, and more.
IQware PMS
 Another example of a PMS for big properties is the IQpms by IQware. It is designed as a
multi-property management system for properties of all sizes. Its functionality can be
applied to resorts, condos, villas, vacation rentals, campgrounds, marina-resorts, and
extended stays.

Like Maestro PMS, this software focuses on guest experience, offers group-booking
opportunities, and provides a customizable guest app that facilitates check-ins/outs. IQpms
also has the Package Management module for all-inclusive resorts or business trips.

The main functionality of this system includes the following modules.

Reservation management. Beside group management capabilities, this module offers the
allotment feature that blocks the rooms for companies, airlines, tour operators, and travel
agents. Also, IQpms calculates travel agent commissions automatically.

Interface of IQware PMS. Source: IQware

Channel management. Connection to multiple distribution channels is possible with the
IQlink Channel Management Tool.

Revenue management. The revenue management module of IQpms has 5 levels of yield
control. There’s also a rate management functionality that helps get the most yield out of
occupancy levels, days, seasons, and events.

The optional modules that can expand the IQware PMS’s functionality are Activity
Booking, Guest Loyalty Program, and Work Order Billing.

Modules for other property types include Timeshare Management, Vacation Club
Management, Condo-Hotel Management, and Marina Management. They expand a
standard list of features with functions like activities booking or a customized maintenance
management module.

Additional IQware products that can be purchased separately are

 Central Reservation System,
 Email Platform,
 Spa Management,
 Point of Sale,
 Sales and Catering, and others.
eZee Absolute
eZee Absolute by eZee Technosys is another industry-recognized, cloud-based software
that supports multi-property management and has different integrated pieces to process
certain operations. The PMS integrates with 500+ third-party products and has its own
property management app for employees and hotel managers.
 Front desk and self-service. The front office module supports room allocations
(automatic and manual), allows for creating customizable registration cards, helps manage
housekeeping staff, and generates night audits. It also has the POS feature connected to
process additional payments. Plus, there’s a guest self-service portal that speeds up the
check-in process, lets customers send requests directly from their smartphones, and receive
receipts online.

CRM and reputation management. The CRM system included in the PMS allows for
sending automatic pre-arrival, in-house, and post-departure emails, and manages email
marketing campaigns. In addition, eZee Technosys has introduced a sentiment analysis-
based Online Reputation Management system that gathers all the guest reviews from
different sources like OTAs, TripAdvisor, and other travel websites, making it more
convenient to respond to them in real time.

Modules for other property types. eZee Absolute allows users to customize the system
for certain types of properties such as resorts, vacation rentals, chains of properties,
serviced apartments, etc. For example, the resort software offers the “Pay at Hotel” feature
when an online payment link is sent to guests that they can use to make a payment of any
amount.
Protel
Protel PMS is a solution that works for both multi-property management of big chains and
independent hotels and comes preintegrated with over 1,000 partners. This provider puts a
big focus on data security and is fully compliant with the General Data Protection
Regulations (GDPR). Protel also boasts their partnership with Amazon AWS making its
product reliable, scalable, and secure.

In addition to standard PMS functionality, Protel PMS features

 Billing and Invoicing,
 Housekeeping,
 Reporting and Analytics,
 ID and Passport Scanner, and
 Maintenance.
The Protel PMS's optional event management module supports organizing conferences,
meetings, and other types of events. It provides control over group bookings, equipment
bookings, meeting rooms, facilities, and other essential event information.
Systems for vacation rentals, apartments, guest houses, and lodging management
In our blog, we have a number of materials dedicated to managing vacation rentals (e.g.,
focused channel managers or specifics of alternative accommodation distribution). We’ve
also discussed vacation rental PMSs so you can consult that post for a detailed overview.
Structure of a vacation rental property management system
In a nutshell, the structure of a vacation rental PMS is similar to that of a hotel but has a
bigger focus on distribution management, communication, online presence, and mobile
access. Also, in most cases, it must be a multi-property management solution.

Some of the PMSs we discussed above provide vacation rental customizations. However,
the hospitality technology market offers specialized products designed for alternative
accommodation types. Typically, they have a user-friendly interface for easy, intuitive
operation on the go through a mobile app. Let’s look at some of them.

Property management systems for vacation rentals and apartments

Hostaway
Hostaway is an award-winning vacation rental PMS that automates all the daily operations
including reservations, marketing, reporting, distribution management, and much more.

Hostaway offers a number of focused automation tools to streamline repetitive tasks related
to payments, messaging, or reviews. There are also website building, payment processing,
and other handy features included.

It comes pre-integrated with 100+ distribution channels and over 3,000 more integrations
are available through Zapier. Users also reported great customer support.
Vreasy
Vreasy has a very intuitive design and a well-developed back-office module with the
feature of task delegations to all staff members, from the front office to housekeeping It
also offers its own communication platform.

Vreasy PMS has an owner portal with a data management module that has access to
multiple travel data sources and generates reports. This PMS has its own payment gateway
 – VreasyPay – that accepts credit card payments in 130+ currencies.

Direct APIs from this PMS connect a property to major booking portals, including Airbnb,
Booking.com, HomeAway, and TripAdvisor. An inbuilt channel manager helps to
efficiently control distribution. Also, Vreasy offers the following features: marketing,
activity booking, automated guest mailing, and others.

Vreasy’s Guest experience platform features Guidal, a smart concierge app (check our post
dedicated to the hotel concierge software and how it can be beneficial for your hotel). This
application unites the functionality of the e-concierge, booking info app, property manual,
and a city guide. Guidal has a partnership with tour operators.
Stays PMS
Stays PMS is a Brazilian product that features a channel management system with
connection to more than 300 distribution channels, including Airbnb, Booking.com,
Expedia, and HomeAway.

Stays PMS has a website management tool that includes integration with Facebook and
makes a content management function possible. It has a guest reviews tool, commission
management, sales and marketing, and a payment processing tool. Depending on the
number of accommodations (from 10 to 1000+), a customer can choose a suitable
subscription plan.
Solutions for small hotels, hostels, inns, B&Bs
Such types of hotel properties usually don’t require too many additional modules, like POS
services or golf management, due to their size and internal structure. The main components
these PMSs should have are an online booking tool, a front-desk solution, and integration
to a hotel’s existing reservation platform. Because small hotels may need slightly different
functions, the PMS should offer a high level of customization.

Property management systems for small hotels, hostels, inns, B&Bs

Such systems usually work well not only for small properties but also for other lodging
types even including campgrounds, glamping sites, and so on.
Little Hotelier
Little Hotelier is a cloud-based solution for small hotel properties like B&Bs, hostels, and
guesthouses. It also has separate offerings for lodges and apartment management.

The PMS is powered by SiteMinder and integrates with this reservation platform.
However, it also allows third-party integrations. Little Hotelier combines all necessary
modules for a hotel in one PMS:
 Front desk management,
 Reservation management,
 Channel manager with online booking engine,
 Payment processing, and
 Reporting and insights.
Also, Little Hotelier is available in a fully functional mobile version and has a website
builder.

This PMS allows for creating not only online reservations, but also reservations by phone
or walk-ins that can be made via the front office. The channel manager of Little Hotelier
distributes properties to more than 450 booking channels including connection to Airbnb
and provides a channel analysis report. The reporting module has convenient dashboards
to monitor a hotel’s performance and financials.

Little Hotelier offers a 30-day free trial if you want to test it before subscribing.
Hotelogix
Another PMS for small properties is Hotelogix. It’s also suitable for hotels, serviced
apartments, and resorts. It has a strong channel management module with GDS
connections, offers third-party integrations with diverse reservation platforms, and enables
customization. For example, if you run a hostel, you can select a bed-based reservation
management system instead of a room-based one.

Hotelogix PMS offers a Facebook online engine and mobile access from the app for the
convenience of a hotel`s team. One more interesting feature of Hotelogix is online
reputation management, created in cooperation with TripAdvisor. This tool allows for
automating guest feedback collection, so that managers can see the reviews and reply
faster.

To test the system, you can sign up for a 15 day free trial.

Localization is also important so interfaces of both Little Hotelier and Hotelogix are
available in various languages, and they can process transactions in different currencies.
What’s the future of the hotel PMS?
Technologies in the hospitality industry are constantly developing, offering new functions
and modules to optimize daily operations – and meet the newly emerging requirements
related to global digitization. So what’s going on with them now?

API-first approach. As experts predict, property management systems switch towards

cloud and open API platforms, which lead to a better connection between different modules
and will sufficiently improve the speed and quality of data exchange. Check our detailed
overview of the main hotel APIs for more information.

AI-powered solutions. The hospitality industry has been adopting AI and Data Science –
you can find out more about it in our dedicated article. Hotel property management systems
are no exception, especially if we talk about business intelligence, revenue management,
and guest service (chatbots and e-concierges).
Internet of Things. We’ve already mentioned the increasing adoption of smart
technologies (like in-room controls, facial recognition, etc.). Most of them are based on
IoT connections and involve implementation of sensors and other smart devices all of
which must be connected to the hotel’s main operation center – the PMS.
Challenges or Problems in Hotel Industry and Their Solutions:
Over the years, many hoteliers shared many pain points with us. So, in this section, we
address a few global issues and challenges in the hospitality industry and their solutions.
1. Hiring and retaining the staff
Challenge
Hiring and retaining staff has always been one of the most common problems in the
hospitality industry.
Every hotel requires quality staff on all fronts; be it administration, maintenance, kitchen,
housekeeping, or frontdesk. Lack of skill in the educated youths graduating from education
houses is also proving to be a major challenge in the hotel industry.
Solution
Training the new workforce on a regular basis is the only remedy available. Retaining a
qualified staff requires you to employ a few tactics. For example, cultivating a feeling of
belongingness (culture) and value for the team members will make them attached to their
jobs and instill a sense of responsibility in their minds.
2. Change in marketing trends and dynamics
Challenge
Marketing is one of the most common challenges faced by the hotel industry.
Changes in the advertising and marketing trend often create problems for hoteliers. Also,
traditional marketing methods aren’t that effective now. So, for those who have always
stuck to the old-school ways, getting the strategy right is one of the biggest challenges of
the hospitality industry.
Online marketing is a surefire method, though it would take years for hotel owners to
establish their strength. Online deals are booked by genuine guests and major transactions
are paid in advance.
Solution
Engaging your guests on social media, messaging apps, and other online sources can work
wonders and give you results in a few months. Implementing effective digital marketing
strategies is a strong solution to such issues in the hospitality industry. Be consistent and
patient with whatever tactics you apply. It is inevitable that with the right strategies.
3. Operational issues
Challenge
There are countless operational challenges in the hotel industry. Ranging from reservations
management, attending to guests, performing all front office operations, maintaining
cleanliness in hotel rooms and premises, and more. However, hotel departments often fail
to perform all tasks in sync which leads to chaos and customer dissatisfaction.
Solution
Besides operations, front office problems and solutions are connected to an integrated hotel
PMS system. The faster you adopt it, the better it is for your property. Your operations are
automated and departmental functions are synced with a PMS because it simplifies
communications to a large extent.
4. Rising cost of daily consumables
Challenge
Price inflation of daily use products, eatables, and other supplies has risen steeply in the
last few years. While that has affected all industries, it takes a huge portion of the issues
and challenges faced by the tourism and hospitality industry.
Solution
A visible solution to this would be to keep a constant check on the inventory, control stock,
and reduce wastage as much as possible. Consider implementing useful cost-saving
strategies at your property, which would help you manage the rising costs.
5. Housekeeping issues
Challenge
Cleanliness is a basic requirement of every guest. In fact, you’d also ask for a clean and
tidy hotel room when you are traveling. A majority of hotel guests would prefer a clean
room over complimentary amenities, any day.
Also, if you think about it, an unclean and messy room is also a common guest complaint.
But there are times when it becomes a little difficult for hotels to stay true to this. After all,
there are various housekeeping challenges involved and strategies are needed to be made
to cope with them.
Solution
Housekeeping challenges in hotels need to be managed well with effective strategies and
thought processes. The housekeeping process needs to be aware of the clean and dirty
rooms and constantly maintain common areas. Do highlight these measures on your
website and social media handles to gain your guests’ trust.
For example; You can track both – arrival and departure list of guests through the hotel
software and can update the housekeeper to clean the room of all the guests who will check-
out from the hotel. Moreover, whenever any guest check-in and ask for a room, you can
easily check whether a housekeeper has cleaned the room or not with the help of the
system.
This is the best way to manage tasks, and keep track of the arriving and departing guests,
and you can prepare yourself well in advance. This way, you can easily avoid challenges
in housekeeping operations.
6. Change in guest expectations
Challenge
Changes in guest expectations are one of the biggest hurdles in the hotel industry. You’ve
witnessed that nowadays guests demand a lot more from a hotel. Be it free WiFi,
entertainment system, unique stay experience, or swift check-in check-out services.
And lately, people have also started expecting contactless hotel services to ensure a safe
stay and eliminate their dependency on hotel staff. Certainly, it’s quite difficult to abide by
these demands because of resource or capital bandwidth, but it will be imperative to do it.
Solution
So, contactless hotel services can be provided with the right technology. Consider
deploying a self-service guest portal that will facilitate quick check-in and check-out
services, share the location of your property, and even let guests request pick-up and drop-
off services. Keep yourself updated with the latest hotel industry trends. Doing that will
help you meet the changing guest expectations in a better way.
Check out the video below, to get an idea of how to provide a contactless guest journey at
your property.
7. Irregular cash inflows
Challenge
One of the major challenges in the hotel industry is the credit menace. Dealing with parties
who pay after 30, 60, and 90 days or even later. While these types of dealings are bigger,
they don’t help much during a cash crunch. On top of that, many payments are delayed or
go into bad debt.
Solution
Consider changing vendors and suppliers following a long payment term. Or strike a deal
with them to collect their due payments in installments rather than in one go. This will keep
your boat sailing for a longer duration. On top of that, you can launch an online marketing
campaign to attract bookings, since these strategies provide a quick ROI.
8. Data security challenges
Challenge
The question of security is not a new one. While our data security methods have advanced
considerably, so have the possibilities of data leaks and virus attacks. Threats of digital
data theft and confidential data leaks are a matter of concern for hoteliers globally.
Solution
The first step to take toward secure data is to ensure proper data storage. Stop dealing with
excel sheets and registers. Incorporate a secure hotel technology that prevents your data
leaks. Technology today is PCI-DSS compliant as well as HTTPS secure, leading to better
data encryption. This way you build your hotel’s credibility to bring in more guests.
9. Maintaining the online reputation
Challenge
Today, internet-savvy visitors look for the brand reputation first before booking a hotel
room. But, maintaining an online reputation is another big challenge that hotels often face.
However, this has not been a current issue in the hospitality industry. Reviews and
reputation have been neglected across all industries since the beginning. Little do they
know, that an unmanaged reputation leads to poor brand image.
Solution
According to a survey, 93% of travelers check hotel reviews before booking a room and
33% of guests do not prefer to book a hotel with no reviews. Moreover, it is always crucial
to track what guests are saying about your brand and the services you provide. Review
management systems help you monitor, manage and respond to your online reviews –
regardless of the platform and language.
I also have something to assist you in responding to reviews.
10. Losing loyal customers
Challenge
Since various hotels are constantly pouring in attractive offers, guests tend not to be limited
to a single brand. Rather, they’re open to options; especially if you fail to connect and
engage with them personally, and deliver a memorable guest experience.
Solution
Running loyalty programs is the MOST practical way to increase your loyal customer base.
These include offering amenities, discounts, and reward points to guests against their
membership. So, even if they’ve stopped using the services, you can approach your guests
and offer them deals or packages. At the same time, do not forget to consider implementing
ways to increase repeat guests at your hotel.
11. Change in technology
Challenge
The advancements in technology are altering every aspect of our daily lives. Gone are the
days when guests used to wait for hours or a day to receive answers to any query. Today,
customers are expecting a fast response and services from hotels. Such constant changes
are extremely arduous to adapt to, which poses a challenge.
Solution
Hotels have begun tailoring guest experiences with chatbots. Chatbots allow hotels to
respond to visitors at once, answer every query instantly, and more. This further increases
hotel bookings, and revenue.
12. Hotels are not data-driven
Challenge
You are well aware that some hotels do not rely on any surefire data for business decisions.
And because of the decisions based on assumptions, many hotels are forced to close down
in a short span.
For instance, business decisions to spend for promotions on OTAs, interiors, room rates,
and room types aren’t decided on the basis of actual statistical reports.
Solution
In order to fight one of the prominent challenges in the hotel industry, you are required to
use software that‘ll give you all the business insights. It can help you in making informed
business decisions and save on extravagant spending. Using the complete data analysis
tool, you can even apply proper revenue management strategies to earn higher revenue.
13. The growth of local hospitality hosts and rising competition
Challenge
These days, more and more property owners are renting out their rooms or property
occasionally. Homestays and vacation rentals promise an authentic local experience
besides being convenient. Owing to this, travelers prefer to choose those homestays over
hotels and resorts. Other than that, new hotels are entering the market every day. This
growing number of homestays and competition is one of the challenges in the hospitality
industry of 2022.
Solution
First and foremost, solid competition analysis is needed. You need to know how your
competitors are doing, monitor their strategies, and then devise better plans for your
property. On top of that, you need to offer something significant to attract your guests.
Constant innovations and personalized services are eventually the only way to beat the
competition.
14. Restoring business post natural calamities and crisis
Challenge
So, I think this is a recently faced challenge (or rather, ISSUE) in the hospitality industry.
The whole world shut down traveling during the COVID-19 outbreak, because of which
the hotel industry also had to shut down its operations. Canceled reservations, indefinite
lockdowns, and shutdown hotels; this was probably the worst hit times for the tourism and
hospitality industry.
While it is a challenge to survive these times, it is an even bigger challenge to come out of
these times as a winner. And the hardest to restore the business in these uncertain times.
Solution
To be honest, none of us would have imagined a situation like this, where we would be
fighting for our survival. But it is entirely up to us how we see these challenges, learn from
them and come out even more potent than we were.

Licenses and Registration Required for Hotel Business

1. Building Permit:
The National Building Code of India was prepared by the Bureau of Indian Standards to
unify building regulations throughout the country. The National Building Code is adopted
by all Government Departments, Municipal Bodies, and other Construction Agencies. As
per the National Building Code, no person shall carry out any development, erect, re-erect
or make alterations or demolish any building or cause the same to be done without first
obtaining a separate permit for each such development/building from the Authority.
Therefore, all hotels must have a proper building permit as per the relevant Town Planning
Act or Development Act or Municipal Act, or any other applicable statutes for layout,
building plans, water supply, sewerage, drainage, electrification, etc,
2.Fire Safety Permit
A fire safety certificate or permit required for the Fire Department is a must for operating
a hotel business. A fire safety certificate is usually provided if the building has incorporated
proper fire prevention and fire safety measures as required under the relevant fire safety
rules and regulations.
3.Police License for Hotel
Hotels are public places that are monitored closely by the Police Department. Therefore,
all hotels must maintain a proper log of all Guests who have stayed at the hotel, follow
relevant regulations and maintain a valid permit from the Police Department. Police license
for hotels usually falls under the power of licensing Places of Public Entertainment held by
the Commissioner or Additional Commissioner of Police.
4.Health Trade License or Trade License
A health trade license is usually required from the local Health Department for restaurants
and hotels. Health trade licenses are usually issued by the Municipal Corporation. A health
trade license is required for businesses that have a direct impact on public health.
Compliance with the relevant hygiene and safety norms, which are important for public
health, is a prerequisite for the issuance of a health trade license.
5.Business Registration
It is recommended that a hotel be set up under an artificial legal entity like a company
or LLP. By operating a company under an artificial legal entity, the liability of the
promoters with respect to the business can be limited and the business as a going concern
would be easily transferable to another person.
6.ESI Registration
ESI is an autonomous corporation under the Ministry of Labour and Employment,
Government of India. Employee’s State Insurance (ESI) registration is mandatory in India
for Businesses that employ 10 or more employees. To maintain compliance with the ESI
Regulations, the employer must contribute 4.75% of the wages for all employees earning
Rs.15, 000 or less toward ESI employer dues. The employee is required to contribute
1.75% of his/her wages as ESI dues.
7.PF Registration
An Employee Provident Fund (PF) Registration is required for any establishment that
employs more than 20 persons in India. The PF Board administers a contributory provident
fund, a pension scheme, and an insurance scheme for the workforce engaged in the
organized sector in India.
8.Bar License
If the hotel operates a bar or serves alcohol in the restaurants, a Bar license will be required
from the relevant authorities. Bar license is usually provided by departments operating
under the State Government. Hence, the requirement for a bar license varies from state to
state.
9.FSSAI Food Business License
An FSSAI food business license under the Food Safety and Standard Act is required for
operating a restaurant in India. The FSSAI food business license is usually provided for
one year and is renewed at the end of each year. FSSAI license for restaurants is managed
by the local FSSAI office. FSSAI license for restaurants does not fall under the purview of
the Central Government.
10.GST Registration
Prior to the introduction of GST a restaurant’s bill comprised VAT, services tax, and
service charge. However, after 2019, indirect taxes collected on the sale and purchase of
goods and services in India have been absorbed by the GST Registration Limit regime of
indirect taxation.
Restaurants at starred hotels that have a daily room cost of Rs.7, 500 would be charged
18% GST, and they will be eligible for ITC. Restaurants at hotels that charge less than
Rs.7, 500 per night will be charged 5% GST but will not be eligible for ITC.
11.Eating House License
Every area where the public is allowed and where any kind of food or drink is provided for
consumption on the premises is referred to as an eating house. The Eating House License
is issued by the city’s Licensing Police Commissioner.
12.Lift Clearance License
If your hotel is multi-storied and you want to operate a lift, you will need to get permission
to do so. After verifying the installation of the lift, structure, safety gears, and other
products, the Electrical Inspector issues this license from the Labour Commissioner’s
office. For receiving lift clearance, state-specific applications are available.
13.Music License
Suppose your hotel outlet is playing any recorded music or video. In that case, you must
obtain a license in compliance with the Copyright Act of 1957 issued by Phonographic
Performance Limited or the Indian Performing Right Society.
14.Signage License
You must acquire a valid permit, which is the signage license, if you wish to advertise your
restaurant through signs, flyers, photographs, and symbols. Local civil authorities, such as
municipal corporations, may provide you with this license.
15.Certificate of Environmental Clearance (CEC)
This permit is required as a part of the Environmental Management Act under the Ministry
of Environment and Forests for a specific type of project. An assessment is done to rule
out any negative environmental impact by the CEC authority post-filling out a
questionnaire. The restaurant is responsible not only for the health of its customers but also
for the environment. As a result, restaurants must still apply for a Certificate of
Environmental Clearance.
Marketing of Hotel Services:
Below, you will find a breakdown of some key trends associated with hotel marketing.
For your convenience, these trends are both general trends and trends that are connected
to coronavirus and the associated changes in consumer behavior.
1. Collect First-Party Data
Within hotels, first-party data can come from many sources, including your website
analytics, booking engine, and direct communication with customers across multiple
channels. The data itself can also take many forms, from demographic data to behavioral
data, performance data, customer feedback, and conversational data.
You must collect and utilize first-party data to get the most from your hotel marketing
efforts. This means designing your business operations around collecting valuable
information. For instance, you need to ask the right questions during conversations, you
need your booking engine to extract the most important pre-arrival data, and so forth. The
more valuable first-party data you gather, the more you can use it to enhance your
marketing efforts.
2. Highlight Safety in Hotel Marketing & Guest Communication
One of the biggest trends within hotel marketing is the increased need to highlight safety
measures and hygiene within your marketing content and guest communications.
Travelers need reassurance that they are keeping their property up to hygiene standards.
When making booking decisions, hygiene measures and safety policies are in customers’
minds. How well you communicate your steps can easily differentiate between generating
sales and failing to do so. Your efforts must be communicated on your website, third-
party platforms, emails, and elsewhere.
3. The Role of Flexible Cancellations
Concerning customer service, one of the essential things those in the hotel industry need
to remember is that COVID-19 created a lot of uncertainty. Customers could easily face
the sudden imposition of new restrictions, resulting in loss of money with non-refundable
bookings.
This sentiment is still visible after the height of the pandemic, as flexible and refundable
bookings are much more attractive. Demonstrating an understanding through a flexible
cancellations policy can go a long way towards encouraging bookings in the first place
and can also help you avoid negative press.

Flexible
Cancellation Benefit Risk for Hotel
Aspect

Customer Increased guest loyalty and Potential revenue loss due to

Satisfaction positive reviews. last-minute cancellations.

Adaptation to Mitigation of negative

Financial strain during
External impact during crises like
unforeseen circumstances.
Factors the COVID-19 pandemic.

Pressure to match or exceed

Competitive Attraction of travelers who
competitors’ cancellation
Edge prioritize flexibility.
policies.
4. Video Marketing
Video marketing is one of the most powerful hotel marketing strategies, helping to target
marketing messages toward potential customers in a way that is convenient to them.
Video content is especially popular on social media platforms, and it can combine visual
and audio elements.
The range of options available to marketers is almost endless, from live streams of hotel
activities to promotional videos highlighting hotel features and interviews with customers
sharing their experiences. The growing prevalence of 360-degree video also opens up
greater opportunities to fully immerse audiences.
5. Produce Short-Form Video Content
The short-form video has taken the internet by storm in recent years, especially thanks to
platforms like TikTok or features like YouTube Shorts and Instagram Stories. Short-form
video content has a lot of advantages over long-form content, including requiring little in
the way of time investment and attention span from viewers.
Within hotel marketing, short-form videos can often achieve what would take hundreds
or even thousands of written words to achieve. You can use short-form videos to
highlight your hotel’s main features, showcase your employees’ work, demonstrate some
of your brand values, or attract attention through viral marketing.
Example: Cinematic Hotel Video
6. Artificial Intelligence (AI)
Customer service interactions form a major part of the modern hotel marketing mix, and
artificial intelligence can play an important role here. For example, AI-powered chatbots
are one of the best ways to ensure customers receive quick responses via live chat
functions on hotel websites 24 hours a day, eliminating slow response times.
However, artificial intelligence within the hospitality sector extends far beyond this. For
example, AI can help hotels to segregate customers more effectively, assisting with
personalization marketing efforts. It can also speed up data analytics, while AI-driven
customer service robots can be deployed in hotels.
7. Customer Experience Marketing
Customer experience marketing refers to a collection of hotel marketing strategies that
are based on the experience customers have when staying at a hotel or interacting with a
business. It is based on the idea that hotel customers do not pay for products or services;
they pay for experiences.
Hotels can improve the customer experience in several ways, such as by delivering
excellent customer service, offering unique features in hotel rooms, and providing a
superior range of facilities for guests. By focusing on marketing efforts on the
experience, hotels can tap into why people stay in hotels in the first place.
8. Make Use of Direct Messaging
A hotel marketing concept that marketers are only starting to come to terms with is how
to use direct messaging effectively. This can occur across a number of platforms,
including online chat, mobile text messages, and mobile messaging apps, as well as direct
message tools on social media platforms like Facebook and Instagram.
One of the most important skills for modern hotel marketers to learn is how to use direct
messaging effectively. It will often require a combination of marketing and classic
customer service, as you will need to respond to questions, provide advice, and respond
to complaints, but do so in a way that helps to build brand awareness and familiarity.
9. Voice Search
In recent years, voice search has emerged as one of the most essential hotel marketing
trends, and several hotel marketing strategies can take advantage of this. For instance,
using smart home devices allows customers to book hotels entirely through voice
commands, and hotels should capitalize on this.
Additionally, voice search possibilities can be implemented within hotel rooms and
promoted to attract customers. This can be achieved by including smart speakers or smart
hubs in hotel rooms, allowing guests to use them to obtain the latest tourist information or
to book hotel services from the comfort of their rooms.
10. Hotel Chatbots
Customers tend to have high expectations regarding online customer service, anticipating
swift replies to questions, and this is where chatbots can be of great value. A chatbot can
be set up to answer common questions, push your key marketing messages, increase
direct bookings, and even guide customers through bookings.
Chatbots’ main benefits include the ability to respond to customers even when staff is
unavailable and automatic language detection and communication in multiple languages.
Chatbots can continue to communicate with guests throughout the customer journey,
including in the follow-up phase.
11. Augmented Reality
Augmented reality is somewhat similar to virtual reality technology. Still, rather than
entirely altering a user’s surroundings, it works by overlaying information onto real-
world environments – usually through a smartphone or tablet. The technology itself
became mainstream through popular apps like Pokemon Go.
Today, augmented reality marketing is one of the most significant hotel marketing trends.
In particular, promoting AR features can help a hotel to stand out from rivals. An
example of its uses would be the inclusion of interactive wall maps in rooms, which can
provide users with tourist information when they aim a smartphone at them.
12. Let Potential Guests Experience Your Hotel From Afar
What if there was a hotel technology you could turn to to help potential guests make their
booking decisions? Virtual reality tours offer precisely this. Potential guests and B2B
clients can experience your hotel from afar using VR technology.
This can be particularly effective during the booking process, which is why VR tours are
increasingly integrated into booking engines. With those interested in your business or
event options, VR means they can also see your wedding, event, or dinner facilities and
book without requiring an in-person inspection first.
13. Influencer Hotel Marketing
Influencer marketing refers to reaching out to individuals with a significant online
presence and using their influence to get marketing messages out to a particular audience.
Influencers tend to have established audiences, which may consist of a specific
demographic, and their audience will usually respect their views.
In some ways, influencer marketing is similar to celebrity endorsements, with the
audience trusting a business or brand because of its association with someone they trust
or admire. Hotels might partner with influences to create video content, social media
posts, written content, or other forms of online marketing.
14. User-Generated Content
In the hotel industry, user-generated content refers to online content created and shared
by customers. Examples range from customer reviews and video blogs to hotel photos or
holiday snaps. User-generated content is most commonly shared on social media or via
personal blogs.
This kind of content has the benefit of coming from real customers rather than from a
brand, increasing audience trust. For hotel marketing strategies to truly harness the power
of user-generated content, they must provide opportunities for it to be easily created and
shared, with digital photo booths as one example.
15. Personalization in Hotel Marketing
Personalization marketing aims to deliver more targeted promotional content to
individual users. It is a technique that relies heavily on the collection of user data. The
primary advantage of personalization marketing is that the promotional content that
customers see is more relevant to them as individuals.
Personalization marketing can take several forms, including intelligent product
recommendations delivered online or personalized email marketing campaigns. Content
can be tailored by obtaining personal contact details and targeted toward specific users
based on their web browsing habits and social media activity.
16. Remarketing
Remarketing is a way for those in hotel management to reach out to users who have
already visited their hotel website or interacted with their brand on social media. It can be
especially beneficial to hotels because research indicates many people begin to make a
hotel booking before stopping. This could be because they have become distracted or
want to conduct further research.
Remarketing allows these users to be targeted with specific marketing messages, such as
an image of the exact hotel room they were booking, reminding them of their interaction.
A major advantage of remarketing over other digital advertising is that hotels already
know these users have shown some interest.
17. Metaverse: An Innovative Hotel Marketing Trend
The metaverse provides several unique hotel marketing opportunities and can help bring
offerings into the modern age. Firstly, hotels can provide a virtual or digital space where
people can interact freely without needing to be in the exact location. This may be
especially useful for business customers hosting online meetings.
UNIT-V
TOURISM
Tourism, the act and process of spending time away from home in pursuit of recreation,
relaxation, and pleasure, while making use of the commercial provision of services. As
such, tourism is a product of modern social arrangements, beginning in western Europe in
the 17th century, although it has antecedents in Classical antiquity.
Tourism is distinguished from exploration in that tourists follow a “beaten path,”
benefit from established systems of provision, and, as befits pleasure-seekers, are generally
insulated from difficulty, danger, and embarrassment. Tourism, however, overlaps with
other activities, interests, and processes, including, for example, pilgrimage. This gives rise
to shared categories, such as “business tourism,” “sports tourism,” and “medical tourism”
(international travel undertaken for the purpose of receiving medical care).
The origins of tourism:

monk at Kyaiktiyo (Golden Rock) pagoda

Monk standing at the Kyaiktiyo (Golden Rock) pagoda, a historic Buddhist pilgrimage
destination in eastern Myanmar (Burma).(more) Varanasi, Uttar Pradesh, India: pilgrimage
Hindu pilgrims bathing in the Ganges River at Varanasi, Uttar Pradesh state, India.(more)
By the early 21st century, international tourism had become one of the world’s most
important economic activities, and its impact was becoming increasingly apparent from
the Arctic to Antarctica. The history of tourism is therefore of great interest and
importance. That history begins long before the coinage of the word tourist at the end of
the 18th century. In the Western tradition, organized travel with supporting infrastructure,
sightseeing, and an emphasis on essential destinations and experiences can be found
 in ancient Greece and Rome, which can lay claim to the origins of both “heritage tourism”
(aimed at the celebration and appreciation of historic sites of recognized cultural
importance) and beach resorts. The Seven Wonders of the World became tourist sites for
Greeks and Romans.
Pilgrimage offers similar antecedents, bringing Eastern civilizations into play. Its
religious goals coexist with defined routes, commercial hospitality, and an admixture of
curiosity, adventure, and enjoyment among the motives of the participants. Pilgrimage to
the earliest Buddhist sites began more than 2,000 years ago, although it is hard to define
a transition from the makeshift privations of small groups of monks to recognizably tourist
practices. Pilgrimage to Mecca is of similar antiquity. The tourist status of the hajj is
problematic given the number of casualties that—even in the 21st century—continued to
be suffered on the journey through the desert. The thermal spa as a tourist destination—
regardless of the pilgrimage associations with the site as a holy well or sacred spring—is
not necessarily a European invention, despite deriving its English-language label from Spa,
an early resort in what is now Belgium. The oldest Japanese onsen (hot springs) were
catering to bathers from at least the 6th century. Tourism has been a global phenomenon
from its origins.
Needs for Tourism/Importance of Tourism:
I. Important to the tourist:
1.Enhanced quality of life:
Taking a holiday can greatly benefit a person’s quality of life. While
different people have very different ideas of what makes a good
holiday (there are more than 150 types of tourism after all!), a
holiday does have the potential to enhance quality of life.
2.Ability to broaden way of thinking:
Travel is known to help broaden a person’s way of thinking. Travel
introduces you to new experiences, new cultures and new ways of
life.
Many people claim thatchy ‘find themselves’ while travelling.
3.Educational value:
One reason why tourism is important is education.The importance of
tourism can be attributed to the educational value that it provides.
Travellers and tourists can learn many things while undertaking a
tourist experience, from tasting authentic local dishes to learning
about the exotic animals that they may encounter.
4.Ability to ‘escape’:
 Tourism provides the opportunity for escapism. Escapism can be
good for the mind. It can help you to relax, which in turn often helps
you to be more productive in the workplace and in every day life.
5.Rest and relaxation:
Rest and relaxation is very important. Taking time out for yourself
helps you to be a happier, healthier person.
6.Enhanced wellbeing:
Having the opportunity for rest and relaxation in turn helps to
enhance wellbeing.
II. Tourism is important to stakeholders:

III. The importance of tourism: Economic gains:

Perhaps the most cited reason in reference to the importance of tourism is its economic
value. Tourism can help economies to bring in money in a number of different ways. Below
I have provided some examples of the positive economic impacts of tourism.
1.Foreign exchange earnings:
The importance of tourism is demonstrated through foreign exchange earnings.
Tourism expenditures generate income to the host economy. The money that the country
makes from tourism can then be reinvested in the economy. How a destination manages
their finances differs around the world; some destinations may spend this money on
growing their tourism industry further, some may spend this money on public services such
as education or healthcare and some destinations suffer extreme corruption so nobody
really knows where the money ends up.
2.Contribution to government revenues:
 The importance of tourism is also demonstrated through the money that is raised and
contributed to government revenues. Tourism can help to raise money that it then invested
elsewhere by the Government. There are two main ways that this money is accumulated.
Direct contributions are generated by taxes on incomes from tourism employment and
tourism businesses and things such as departure taxes. According to the World
Tourism Organisation, the direct contribution of Travel & Tourism to GDP in 2018 was
$2,750.7billion (3.2% of GDP). This is forecast to rise by 3.6% to $2,849.2billion in 2019.
Indirect contributions come from goods and services supplied to tourists which are not
directly related to the tourism industry. There is also the income that is generated
through induced contributions. This accounts for money spent by the people who are
employed in the tourism industry. This might include costs for housing, food, clothing and
leisure Activities amongst others. This will all contribute to an increase in economic
activity in the area where tourism is being developed.
3.Employment generation:
The importance of tourism can be demonstrated through employment generation.
The rapid expansion of international tourism has led to significant employment creation.
From hotel managers to theme park operatives to cleaners, tourism creates many
employment opportunities. Tourism supports some 7% of the world’s workers.
There are two types of employment in the tourism industry: direct and indirect.
4.Contribution to local economies:
The importance of tourism can be further seen through the contributions to local
economies.All of the money raised, whether through formal or informal means, has the
potential to contribute to the local economy.
5.Overall economy boost:
Tourism boosts the economy exponentially. This is partly because of the aforementioned
jobs that tourism creates, but also because of the temporary addition to the
consumer population that occurs when someone travels to a new place. Just think: when
you travel, you’re spending money. You’re paying to stay in a hotel or hostel in a certain
area – then you’re eating in local restaurants, using local public transport, buying souvenirs
and ice cream and new flip flops. As a tourist, you are contributing to the global economy
every time you book and take a trip.
IV. The importance of tourism: Social gains:
The importance of tourism is not only recognised through economic factors, but there are
also many positive social impacts of tourism that play an important part. Below I will
outline some of the social gains from tourism.
1.Strengthening Communities:
The importance of tourism can also be demonstrated through the strengthening of
communities. Events and festivals of which local residents have been the primary
participants and spectators are often rejuvenated and developed in response to tourist
interest.
The jobs created by tourism can also be a great boost for the local community. Aside from
the economic impacts created by enhanced employment prospects, people with jobs are
happier and more social than those without a disposable income.
 2.Provision of Social Services:
The importance of tourism is shown through the provision of social services in the host
community.
The tourism industry requires many facilities/ infrastructure to meet the needs of the tourist.
This often means that many developments in an area as a result of tourism will be available
for use by the locals also.
3.Commercialisation of Culture and Art:
Tourism can see rise to many commercial business, which can be a positive social impact
of tourism. This helps to enhance the community spirit as people tend to have more
disposable income as a result.
These businesses may also promote the local cultures and arts. Museums, shows and
galleries are fantastic way to showcase the local customs and traditions of a destination.
This can help to promote/ preserve local traditions.
4.Revitalisation of Culture and Art:
Some destinations will encourage local cultures and arts to be revitalised. This may be in
the form of museum exhibitions, in the way that restaurants and shops are decorated and
in the entertainment on offer, for example. This may help promote traditions that may have
become distant.
5.Preservation of Heritage:
Another reason for the importance of tourism is the preservation of heritage. Many tourists
will visit the destination especially to see its local heritage. It is for this reason that many
destinations will make every effort to preserve its heritage.
6.Empowering communities:
Tourism can, if managed well, empower communities. While it is important to consider
the authenticity in tourism and take some things with a pinch of salt, know that
tourism can empower communities.
V. The importance of tourism: Environmental gains:
Whilst most media coverage involving tourism and the environment tends to be negative,
there are some positives that can come from it: demonstrating the importance of tourism
once again.
1.Protecting nature:
Some people think that tourism is what kills nature. And while this could so easily be true,
it is important to note that the tourism industry is and always has been a big voice when it
comes to conservation and the protection of animals and nature. Tourism organisations and
travel operators often run (and donate to) fundraisers.
Growth and Development of Tourism in India:
For a country that is surrounded by the Himalayas to the north, the Indian Ocean to the
south, The Bay of Bengal to the east, and the Arabian Sea to the west, India quite hasn’t
tapped into the full potential of tourism. Even the tourism industry is the largest service
sector in India, the tourism growth in India is something that is still a work in progress.
With 37 UNESCO heritage sites and a land blessed with rich heritage and cultural diversity,
each region in India has a unique story to tell. People have different expectations for
tourism. Some prefer beaches, while others may like forests, some other people may be
into deserts, etc. No matter what the preference, India has different regions to cater to
everyone’s expectations.
As per the WTTC (World Travel and Tourism Council), about 9.2 percentage of India’s
GDP in the year 2018 came from Tourism. From just over 2 million tourists in 2000 to
over 42 million jobs in the Indian travel and tourism industry in 2018, and 10 million
foreign tourists visiting the country in the same year, the growth of tourism in India has
been steady. Despite these good tourism growth statistics, India has a long way to go to
fully exploit this domain.
Tourism History in India
The idea of tourism can be dated back to the beginning of the human race itself. In ancient
India, tourism was mainly for the purpose of commerce and trade. Emperors and kings
such as Ashoka and Harsha travelled to different destinations and established trade routes.
Along their journey, they implemented rest houses, stations for food, as well as developed
the roads for the comfort of the travellers. Later on, a foreign form of tourism started when
Persians, Portuguese, and a few others visited India for the purpose of commerce. The
purpose soon starting changing into leisure, religious, and so on.
It was until after the independence in 1945 that an official tourism planning started by the
government. The Indian Tourism Development Corporation was implemented in the year
1966 to improve the infrastructure and begin the focus on evolving tourism in India.
Following this, the first tourism policy was formed in 1982, and the main focus of it was
to improve tourism in order for economic growth. Based on this, in 1986, the Planning
Commission of India started the National Committee on Tourism to start with the plans.
As a result, over the years there have been several 5-year plans to make India into a global
tourist attraction.
Tourism Development in India
The growth of tourism in India, although steady, is quite not up to the expectation. For a
country with a population of 1.25 billion people, that is a minimum of 1.25 billion tourist
visits. India, as a result, is doing great when it comes to domestic tourism with over 1.6
billion tourist visits to other states. However, when it comes to international tourists, this
isn’t the case. The FTAs ( Foreign Tourist Arrival) in India is way below other developed
countries. With an FTA of just over 10 million, it is almost one-eighth of what France has.
Granted that this could be due to the free travel between Schengen countries, but there are
several non-Schengen European countries, as well as other nations, such as Mexico,
Turkey, Russia, etc that have FTAs more than twice that of India. One of the main reasons
for this is the stringent immigration rules in India. Apart from this, other reasons that
restricted a full flow of tourism in India were underdeveloped travel infrastructure, poor
sanitation, as well as concerns about safety. These are aspects that every tourist look for
while visiting a country.
However, thanks to several initiatives by the Govt. of India, these issues have almost
completely disappeared. Campaigns such as Incredible India, Atithi Devo Bhava, India has
become a welcoming nation to tourists from all around the world. Thanks to the e-visa
facility for tourist purposes, travellers from more than 100 countries can get into India with
ease. There are even countries who do not need a visa for India. With the government
investing heavily in tourism, as well as easing the regulations on FDI (Foreign Direct
Investment) allowing for 100%, the Indian tourism industry has started to flourish
significantly.
Scope of Tourism in India
The future of tourism in India is golden. From earning 27 billion USD from tourism in
2017, the earnings are expected to be around 50 billion USD by the year 2028. With a large
scale development being initiated, India aims to be at the top of the tourism economies
only behind China, US, and Germany. As per the expectations, the travel and tourism
industry’s contribution to the Indian GDP will jump from around 200 billion in 2017 to a
massive 424 billion by 2027. A large number of countries have tourism as their main source
of income. This has instigated the Indian government to give a larger focus on tourism.
India’s route to be becoming the largest world economy can only be accomplished by fully
realizing the potential of tourism.
For full tourism growth in India, we need to address the different types of tourism that
exists in India to its full possibility. Tourism is a sector that has its branches in almost every
other industry. There are numerous types of tourism that exist in India. For the main types,
the scope of tourism in India is broadly classified into the following-
Medical Tourism
Medical tourism in India is a billion dollar industry that is at its peak. India is a major
destination for people around the world seeking medical treatment. Due to the medical
sector being backed and promoted by the government, this has flourished significantly in
the last few years. By 2020, the income from medical tourism is expected to be around 9
billion USD.
Even in the US, most of the people working in healthcare are Indians. As a result, there is
no shortage of skilled Indian medical workers in the world. Couple this with the low-cost,
high-quality healthcare in India and English speaking professionals, you get the perfect
recipe for excellent medical facilities. This is what attracts tourists. Instead of paying
almost 4-5 times the medical expenses in India, in their country, they can obtain a better,
if not equal, level of service in India. For example, open heart surgery costs up to 70000
USD in the UK. And, the same procedure can be performed in India for a maximum of
10000 USD. Due to massive differences in the costs, there is a large influx of tourists
visiting India for these purposes.
Eco-Tourism
In layman term, Eco-tourism is simply the form of tourism in which a tourist visits a place
without disturbing the environment and respecting the local culture and people. Eco-
tourism in India is a new approach taken to preserve the ecosystem and heritage. This type
of tourism is largely beneficial to the local people. By directly involving in this, they ensure
that the environment and natural resources are protected.
In India, the hotspots for this are common in the western and eastern ghats, Himalayan
areas, Kerala, Northeastern states, Andaman and Nicobar islands, and Lakshadweep. The
importance of eco-tourism is significantly high. To maintain the balance of the ecosystem,
it is necessary to preserve the flora and fauna, especially those of endangered species. With
an increase in tourists, these are threatened. As a result, the government has initiated eco-
tourism to counter this issue.
Religious Tourism
The birthplace of 4 major religions, namely Buddhism, Hinduism, Jainism, and Sikhism,
pilgrimages have been a part of the country since early ages. Along with these, due to the
invasion by the Mughals, and Portuguese and French colonializations, imprints of other
religions like Islam and Christianity have been established in India. Tourism to
monasteries, temples, mosques, churches, as well as other religiously significant places
includes religious tourism. Until recently, this form was mainly domestic. However, due
to recent developments, these sites have started attracting foreigners. Most of the tourism
in this domain has been to the state of Tamil Nadu, known for its ancient temples, statues,
and caves, etc.
Cruise Tourism
With a large capacity for development, cruise tourism in India is an upcoming industry.
Being the most luxurious of the world’s tourism industry, its effect in India has been limited
due to several reasons. However, recent initiatives and developments have opened up a
pathway to improve this sector. Cruises are basically ships or boats that provide special
amenities like pools, hotels, restaurants, etc along with the journey from one destination to
another. As of now, cruise tourism is limited to river tourism, and other forms of domestic
tourism with cruises mainly operating between Mumbai-Goa, as well as to Maldives,
Lakshadweep, and a few other places. River tourism in India can be seen in the river
Ganges, and in the backwaters of Alleppey in Kerala.
Adventure Tourism
Being a modern form of tourism targeting adventure enthusiasts, adventure tourism
involves exploring and travelling to remote areas and exotic locations. These activities can
include trekking, white water rafting, skiing, surfing, rock climbing, skydiving, and so on.
India, being very diverse in terms of even terrains and climates makes several types of
adventure tourism possible. The adrenaline pumping nature of this attracts a large number
of tourists from all over India as well as the world. The most notable mentions are
Uttrakhand, Himachal Pradesh, The Himalayas, Ladakh, etc.
Wellness Tourism
Similar to healthcare, India is a well-known hotspot for spirituality and wellness. With an
environment that enhances tranquillity, India attracts quite a number of people for various
activities that are focused on improving one’s health and wellness. Body massages, yoga,
meditation training, nutrition programs, etc are a few of the services under this category.
Cultural Tourism
One major thing that separates India from other countries is its rich culture and heritage.
And this is also one of the main reasons why tourists visit the country. With several fairs,
festivals, architectural sites, and so on, the cultural tourism in India is booming and is
always going to be a crowd puller. Being ruled by several rulers in the past, they all left
behind a piece of their history and heritage leaving an impact on the country. As a result,
every region in India has a different array of culture, food, music, and tradition. Some of
the major states for these are Tamil Nadu, Uttaranchal, Uttar Pradesh, etc.
Leisure Tourism
Known for the coastal lines, hill stations, and lakes, people visiting India to enjoy these
come under the category of leisure tourism. Even though a significant amount of this is
domestic, it certainly does attract several foreigners too. The French colony of Pondicherry
and the Portuguese influenced Goa are two of the most visited places for its beaches,
attracting several foreigners. Mount Abu, Kullu-Manali, Ooty, Mahabaleshwar, etc are
famous hill stations that attract a lot of domestic tourists.
Apart from these, there are a few other types of tourism that exist in India. However, since
these are the most important ones, future tourism growth in India in these sectors can
increase the statistics significantly.
Impact of Tourism in India
The development of tourism is something that affects the entire nation. The impact of
tourism on a country is much more than just revenue. Directly or indirectly, tourism
influences a number of sectors as well as key areas such as environment, heritage,
infrastructure, economy, employment, etc. The following are the 2 major areas that are
grateful to tourism for their development.
Economy
The impact of tourism on the economy of India is a major one. Currently, the amount of
GDP from tourism is more than 9 per cent. That is quite a significant number which is still
climbing. With over 10 million international tourists visiting the country, the FEE (Foreign
Exchange Earnings) has reached over 275 million USD in 2018. These numbers are
expected to grow at a rate of about 9.4% per year. In a few years, the economic impact due
to the growth of tourism will usher India to become one of the most developed countries
in the world.
The impact of tourism on Indian economy can be classified in 3 different ways namely,
direct, indirect, and induced. The direct impact, as the name suggests, refers to the areas
where the economy is directly affected by tourism. These include sales from the
accommodation, travel, food, entertainment activities, as well as other sectors that involve
the tourists spending directly. Indirect economic impacts or secondary tourism impact on
the economy are due to other factors which affect tourism indirectly. They are also affected
by sales of additional services or products that do not directly affect tourism such as
investments, commissions, employee wages, buying raw materials for hotels and
restaurants, etc. Indirect contribution accounts for a larger portion of the revenue from
tourism. The third and last type, Induced spending is simply the recirculation of money
within a region. When a tourist spends money on anything, it undergoes a multiplier effect
which goes into the local economy. Ie, if a foreigner spends 100 dollars on a hotel, the hotel
owner again spends 10 dollars on food, another 10 for groceries, another 10 for cleaning,
and so on thereby spending it within the local community.
Employment
The impact of tourism on employment generation is significantly high. With every 1 out
of 10 people working in the tourism sector, the tourism industry accounts for about 10 per
cent of the total jobs. To be precise, this is actually a subset of the effects of tourism on the
economy. Directly or indirectly, there is a large number of people working in the sector.
Direct employment refers to the people working in the tourism sector directly, such as
travel agents, ticketing officers, tour guides, etc. Indirect employment is used to describe
the people in jobs such as manufacturing vehicles used in tourism, restaurants providing
food served to the tourists, etc. As of 2018, there are almost over 40 million Indians
working in the tourism industry. Another interesting fact that shows the tourism impact on
employment is the employment multiplier effect. According to this, a person directly
involved in the field creates a multiplier effect to produce several other jobs. For example,
let's say a person works as a tour guide. Now, while he is on a tour, he will have to eat
food, buy clothes and so on. As a result, this creates an opportunity for someone else to
start up a clothing store or a restaurant thereby increasing employment opportunities.
Government Initiatives to Develop Tourism
To ensure that India reaches its true potential for tourism, the Govt of India has
implemented several policies over the years to encourage and develop tourism. Some of
the main government initiatives to promote tourism in India are as follows -
Incredible India
The ‘Incredible India’ campaign is one of the most famous initiatives by the Indian
government. Started officially in 2002, this campaign has made Indian tourism quite the
household name in all corners of the world. The initial phase of the initiative was to
increase the number of foreign travellers by promoting India for its culture, history as well
as wellness activities such as yoga, and spirituality. As a result of its positive reception, the
campaign was renewed as ‘Incredible India 2.0’ in 2017 which focuses more on niche
tourism sectors such as heritage, cruise, adventure, as well as medical tourism.
Atithi Devo Bhava
To complement the ‘Incredible India’ initiative, the Indian government initiated another
campaign known as ‘Atithi Devo Bhava’ which translates to ‘guest is god’. Released in
2008, the purpose of this was to educate and enlighten the local population on good
behaviour and etiquette while welcoming foreign tourists to ensure that the tourists feel
welcomed. The campaign also provided training to individuals directly dealing with the
tourists, such as police, immigration officers, taxi drivers, tour guides, etc.
Adopt a Heritage
Released in 2017, the ‘Adopt a Heritage’ scheme is a policy focused on preserving and
protecting the heritage. Through this, the government encourages parties from the private
or public sector to adopt a monument or heritage site, and ensure the development and
maintenance of these. These include providing drinking water to tourists, keeping the area
clean, surveillance, and so on. Since this is a win-win scenario for both the government, as
well as the volunteers, it saw an overwhelming response with several monuments and
heritage sites being maintained by external groups.
E-Visa
The implementation of the e-visa scheme in 2014 has significantly helped the growth of
tourism in India. Previously, due to strict visa rules, tourists often found it cumbersome to
visit India. However, ever since the release of the e-visa, tourists can simply apply for the
visa on an online portal, thereby making it extremely straightforward to get a visa. Initially,
only 44 countries had access to these, but recently this has been increased to almost 165
 countries. Even though currently there are e-visas in the form of tourist visa, medical visa,
and business visa, the government has already started initiatives to expand this.
Swachh Bharat
The Swachh Bharat (Clean India) mission has significantly helped in improving the
number of visitors to India. Previously, one of the reasons for the low statistics in terms of
foreign arrivals was the lack of good sanitation and cleanliness in several areas of the
country. Launched in 2014, and recognized as the largest behaviour change initiative in the
world, this campaign focused on making India a cleaner country.
The development of the tourism industry is one of the hurdles that stand in front of India
and true greatness. With numerous benefits coming from improving tourism, it is a vital
element that needs to be focused on. However, despite the government’s role, it is also the
duty of the citizens of India to help to improve this and grow tourism in India. Even though
foreign tourism is the one generating large revenues, domestic tourism is equally important.
After all, it is a necessity to discover your own backyard.
Present scenario of the tourism sector in India
With 1.52 million foreign visitors anticipated in 2021, India is one of the top tourism
destinations in the globe. India’s foreign exchange revenues increased by roughly $8.8
billion as a result of this. There were also about 680 million domestic travellers.
India is a much-liked tourist destination thanks in large part to its distinct culture, history,
and position as one of the world’s oldest civilizations, as well as its plethora of breathtaking
natural attractions. As a result, there are 40 UNESCO
What is Cultural tourism?
Cultural tourism is a kind of tourism that enables visitors to take part in local cultural
celebrations like festivals and traditions. The traveller can thus have genuine cultural
contact with the people.
Furthermore, because cultural tourism is a significant development engine, it enables local
societies to embrace their culture. Communities, therefore, make a point of praising and
supporting their culture since it sets them apart from other communities.
As nations recognise the value of cultural tourism and how it can boost local economies,
they are focusing on developing cities and villages that will captivate tourists from across
the world to experience and observe the culture in a way that has never been possible
before.
Why Cultural tourism is significant in India?
 Tourists travel to India to experience it for themselves because of the country’s well-known
rich cultural legacy and mysticism.
 Some of the most important civilizations and faiths in the world have their roots in India
and were nurtured there. India is a popular travel destination because of its numerous World
Heritage Sites and unparalleled cultural vibrancy.
 Since time immemorial, India has been regarded as the land of ancient history, legacy, and
culture, which is the main reason for its current stratospheric ascent in the tourism sector.
 Over the years, India has had numerous kings, and each of them had an impact on Indian
culture. Different cultures have left their mark on dance, music, celebrations, architecture,
traditional customs, food, and languages.
 The richness and diversity of India’s heritage and culture can be attributed to the influence
of all these different cultures. This cultural wealth helps to project India as the top
destination for cultural tourism, boosting that industry in India.
 To promote cultural tourism in India, the Indian government established the Ministry of
Tourism and Culture. The ministry recently launched the “Incredible India!” campaign,
which has contributed to the expansion of India’s cultural tourism industry.
Various sites of cultural tourism centres in India
India’s diversity is a result of the country’s mixture of religious and cultural traditions. The
nation is home to a large number of world historic monuments that have an enticing
influence and have long drawn visitors from around the world. We would be delighted to
familiarise ourselves with the many customs and civilizations that make up India’s cultural
heritage.
The Pushkar fair (Rajasthan), Taj Mahotsav (Uttar Pradesh), and Suraj Kund mela are just
a few of the fairs and festivals that travellers can attend in India (Haryana). sites include
the Taj Mahal (Uttar Pradesh), the Hawa Mahal (Uttar Pradesh), Hampi (Karnataka), the
Ajanta & Ellora caves (Maharashtra), and Mahabalipuram (Tamil Nadu) (Rajasthan).
Rajasthan is the most popular state in India for cultural tourism among the several states.
Rajasthan is known for having a rich cultural legacy, which is the reason behind this. The
state is well known for its numerous exquisite palaces and forts that highlight Rajasthan’s
rich cultural heritage. Rajasthan’s rich cultural legacy is also reflected in the numerous folk
songs and music. Rajasthan has many festivals and fairs, including the camel festival, the
Marwar festival, and the Pushkar festival. All of these draw a lot of people to Rajasthan
since they allow them to experience the state’s vibrant culture.
Tamil Nadu is renowned for cultural tourism in India as well because it exhibits Dravidian
customs and culture. Its numerous temples reflect India’s rich cultural heritage. Numerous
tourist attractions in Uttar Pradesh attest to the nation’s rich cultural heritage. The Taj
Mahal in Agra is the most well-known structure. Many tourists also go to Uttar Pradesh
cities like Varanasi, Allahabad, Vrindavan, and Ayodhya because they capture exquisite
scenes from India.
In India, Uttaranchal is renowned for its cultural tourism industry. The Himalayas, known
as the “abode of the Gods,” are located in this state. The Kumaon and Garhwal regions of
the state are home to numerous historic temples.
Government initiatives to boost India’s cultural tourism
Some of the government initiatives to boost cultural tourism in India are:
PRASHAD Scheme
 The Ministry of Tourism introduced the “National Mission on Pilgrimage Rejuvenation
and Spiritual Augmentation Drive (PRASAD)” in 2014–15 with the goal of holistically
developing recognised pilgrimage places.
 In October 2017, the program’s name, which had previously been PRASAD, was changed
to “National Mission on Pilgrimage Rejuvenation and Spiritual Heritage Augmentation
Drive (PRASHAD)”.
 The respective State/Union Territory Government shall implement the initiatives listed
under this scheme through the designated agencies.
 Under its provisions, the Ministry of Tourism offers State Governments Central Financial
Assistance (CFA) for boosting tourism at predetermined locations.
 The Central Government will contribute 100% of the funds needed for components covered
by public funding under this programme.
 It also tries to incorporate corporate social responsibility (CSR) and public-private
partnerships (PPP) for the project’s increased sustainability.
HRIDAY scheme
 The National Heritage City Development and Augmentation Yojana, an HRIDAY
programme, was introduced on January 21, 2015, by the Ministry of Housing and Urban
Affairs.
 The goal of this programme is to protect and promote the nation’s rich cultural heritage.
The HRIDAY programme seeks to preserve cultural assets while also promoting urban
planning and historic cities’ economic development.
 The National Heritage City Development and Augmentation Yojana places a strong
emphasis on the heritage cities’ accessibility, security, safety, way of life, cleanliness, and
quick service delivery.
Buddhist Tourism Circuit
 The Buddhist circuit is a route that follows in the footsteps of the Buddha from Lumbini in
Nepal where he was born, through Bihar in India where he attained enlightenment, to
Sarnath and Kushinagar in Uttar Pradesh in India, where he gave his first teachings and his
final resting place.
 Kushinagar is the centre of the Buddhist circuit, which consists of pilgrimage sites at
Lumbini, Sarnath, and Gaya.
Palace on Wheels
 A luxurious tourist train is called The Palace on Wheels. To promote tourism in Rajasthan,
it was started by the Indian Railways in collaboration with the Rajasthan Tourism
Development Corporation. The name has since changed to Heritage Palace on Wheels.
 In August 2009, the train service underwent renovations and was reopened with new
furnishings, itineraries, and menus.
 The idea for the Palace on Wheels came from the historical royal significance of the
coaches, which were designed to serve as the private trains for the former kings of
Rajputana, Baroda, the Nizam of Hyderabad, and primarily the Viceroy of British India.
 Each saloon showcases the state’s cultural character through the use of furnishings,
handicrafts, paintings, and other decorations. The interior of the train was designed by
Rashmi Gupta, an architect from Jaipur.
What is tourism marketing?
Tourism marketing refers to the marketing strategies that different components of the
tourism industry use to sell their products and services. The businesses include hotels,
airlines, car rental companies, restaurants and travel or tour agencies selling flights,
holidays, hotel rooms or experiences to customers. Most tourism marketing strategies
include social media marketing, email marketing, advertising and online website deals.

Why is this marketing important?

This marketing is important because the current market sees thousands of companies
competing. Therefore, they each look to find unique ways to market themselves and gain
attention. Staying updated and relevant can help organisations within the tourism industry
give tourists what they want. This can help you reach customers in new ways to provide
personalised and hyper-relevant content that interest them.
12 effective strategies to marketing tourism:
1. Decide which market to focus on:
Before you begin, determine your target market. Decide if you want to sell your products
or services to tourists locally or internationally. Whatever you decide here can impact the
rest of your strategy, so you know where to focus your efforts.

2. Use artificial intelligence:

Artificial intelligence is on the rise in the tourism marketing industry. It's an effective way
to use existing data to build customer profiles and behaviours that you can use within your
marketing strategy. When you identify trends and customer demand, you can make smarter
decisions.
For example, suppose a hotel can see that people search for specific keywords during a
certain time of year. In this case, they can plan their marketing strategies around this to
ensure that any customer searching for those keywords finds their business. Hotels can use
artificial intelligence to create bespoke packages or deals for their guests.

3. Take advantage of voice search:

More people are turning to voice recognition software because they want streamlined ways
to plan and manage their lives. Hotels, for example, are using smart hubs with voice
recognition to provide useful advice, whereas travel agents are offering the chance to book
your entire trip just using your voice. If you're using voice technology, consider voice SEO
principles to capitalise on search data on the most popular and widely used platforms.

4. Provide always-on service via chatbots:

Chatbots are an efficient way to provide first-class service for customers. As they can help
to push customers further through the funnel outside of normal working hours, they can
increase your profits, improve the guest experience and increase customer satisfaction.
Chatbots are also handy for pulling data you can use to your advantage. They can compile
a list of the most frequently asked questions, which can help you identify areas for
improvement on your website or to upsell customers and increase revenue.

5. Keep it personal:
Customers are smart, and they know when they're getting bespoke service. Having the right
technology can help you use customer data to build profiles of specific audiences to share
marketing messages that are the most relevant to them. You can provide personalised
messages through email marketing by segmenting customers according to what they buy
or engage with or by their spending power. This data can create tailored offers for your
customers.
6. Experiment with virtual reality tours:
Virtual reality technology is one of the latest marketing trends in tourism. It's especially
engaging because it allows customers to experience something completely new from their
homes. Hotels are using virtual reality to provide walk-through simulations of different
areas of the hotel facilities or guest rooms to help customers decide which one they want
to book. Other uses of virtual reality in tourism include airport lounges where guests can
see what's inside or restaurants to choose their preferred seating area.

7. Create a unique customer experience:

The customer experience is going to keep people coming back. Customers often look for a
memorable experience rather than simply booking a hotel or a flight. There are many ways
to improve customer experience through your service. Airlines do this by competing to
offer the best onboard entertainment and menus, while hotels do this by offering in-room
entertainment or excellent facilities guests can't find elsewhere.

8. Put effort into SEO content marketing:

Content marketing is one of the most significant components of an effective marketing
strategy in tourism. Customers often come to you if you get your SEO strategy right. It also
provides an element of trust and credibility. There are many ways to build your content
marketing strategy.
9. Try influencer marketing:
Influencer marketing is one of the most popular modern marketing strategies and is
extremely effective. Many hotels or tourism centres rely on influencers to introduce and
endorse their business by sharing it with their followers. Restaurants, for example, may
invite a local influencer to eat for free in return for a social media post. Hotels also invite
influencers to stay in return for content about their experience that may encourage their
audience to book a stay.
10. Encourage user-generated content:
In the tourism industry, your customers are also your advocates. If you provide a great
experience, not only can you rely on your customers to share good things about your
business, but you can harness their content at the same time. User-generated content (UGC)
is content the people who use a business, service or product create.

11. Build strong reviews:

Reviews are powerful, especially when customers have access to online platforms. One of
the most practical marketing strategies is first building strong reviews. This is helpful when
launching a new website, tour or package. The more reviews you have, the more likely
customers are to trust and purchase your product.

12. Put money into remarketing:

Remarketing allows you to follow up with customers who have previously interacted with
your business to encourage them to use your services. You can do this by collecting cookies
 with your customer's consent. Once they've visited your website or social media page, you
can collect their data and target them with more relevant content to get them to convert.
Remarketing can be an effective strategy in marketing because you often identify which
pages customers are landing on and engaging with.

Tourism Pricing:
Price
Price is the value of the goods or services. According to Kotler, "Price is the amount of
money charged for a good or service. More broadly, the price is the sum of the values
having or using the product or service." It includes their sacrifice, effort or money. Price
determines profit and loss. A pricing mistake can lead to a business failure, eve when all
other elements of the business are sound.
Price is the perceived value that is exchanged for goods or services. The perceived value
is expressed in terms of money such as dollar, pound or rupees,etc. Price can be anything
with perceived value not just money. Price has various names and meanings:
Interest - Paid for the use of money such as Bank charge
Tarif - Price paid to receive service such as import tariff, hotel tariff, air tariff, etc. It is
also related to government tax.
Rent - Paid for the use of facility, equipment such as house rent, furniture rent, land and
building, etc.
Commision - Price discount paid for serice such as sales commission, broker's
commission etc.
Fare - Cost of transportation such as airfare, rail fare, bus fare, etc.
Wage and Salary - Paid for services of workers
Taxes - Price paid for the privilege such as income tax, import tax
Fee - Paid for the services of professionals tuition fee, consultancy fees etc.
Pricing in Tourism:
Pricing in tourism is very complicated subjects to deal with as tourism is managed at a
different level by different organizations with different organizations. Government fixes
the price of visa, national park entrance fee, conservation fee. Their pricing policy is
more demand based, and is government policy.
Tourism business organizations fix their prices by different names, such as rate, tariff,
service charge, etc. Some business organization follows pricing policy as:
 Single Price Policy:
One price is charged to all customers. The price is not variable according to quantity,
season, purchasing power, etc. This season is very simple to administer and to change
customer but this system ignores demand, costs, and competition.

 Flexible Price Policy:

Various prices ae charged for various customers at different times by different names.
- On the basis of a segment of customers - age, nationality.
- On the basis of location - room at the ground floor or mountain facing.
- On the basis of time - seasonal variation last minute purchasing.
 - On the basis of the market - rate differentiation according to purchasing power, and
their desire or willingness to pay. For example high rate for Japan and USA market.
It is important for tourism manager to have a clear understanding of pricing system and
tourism system and learn to relate both of them into practice. To set a floor of consumer
perception of the product's value is the basic principle of pricing tourism service or
tourism product.
Some basic points to be understood while discussing the price in tourism are:
 Tourism Price is the Origin Price:
This is the factory price at the point of service delivery. Buyer is responsible to pay
transportation charge, entrance fee, visa fee, passport, etc Trekking prices starts from trek
- starting point, rafting price is the raft - put- in- point. Tourist need to buy extra
equipment to travel such as trekking shoes, books, new clothes and first aid, etc.

 Price is not only money in tourism:

It is related with customer's satisfaction, guardianship, positive marketing environment,
the positive mental attitude of society, social and environmental integration, image, etc.

 Price represents the quality:

Customers judge the quality of services with price.

 Price does not represent cost:

In tourism many times price does not represent the real value. Everest expedition royalty
is the price of Mt. Everest. National Park Entrance is not related to environmental
degradation.

 Tourism is made of economic and non-economic elements so tourism price includes non-
economic and immeasurable factors also.

 All the other cost plus luxury and status are included in the tourism product price.
Travellers view tourism products as bundles of benefits and choose those that give them
the best bundle for their money.
Tourism product has time value and $ value. Time value is the time it takes to arrive at
the points of service. and time, duration to consume the service. Price complaints and
price bargain are most frequent in tourism industry.
PricingStrategy:
1.Value-based pricing:
Value-based pricing is a strategy that involves setting your prices according to the
perceived value and benefits that your offer provides to your target market. This means
that you need to understand what your customers are looking for, what they are willing to
pay, and how they compare your offer to your competitors. Value-based pricing can help
you differentiate your offer, increase customer satisfaction, and justify higher prices.
However, you also need to be careful not to overprice your offer, as this can lead to
customer dissatisfaction and negative word-of-mouth.
Value-based pricing in tourism is also a great way to curate the flow of potential customers.
Pricing low for your experiences perceived value will drive people to come in droves if
you need a cash injection, and spiking the price will dull the flow of visitors to allow you
to offer a more bespoke experience as well as meet the demand with your current
resources/staffing.
2.Dynamic pricing:
Dynamic pricing is a strategy that involves adjusting your prices according to the changes
in demand, supply, and market conditions. This means that you can charge higher prices
when the demand is high, such as during peak seasons, holidays, or special events, and
lower prices when the demand is low, such as during off-peak seasons, weekdays, or low
seasons. Dynamic pricing can help you optimize your revenue, attract more customers, and
respond to market fluctuations. However, you also need to be transparent and consistent
with your pricing, as this can affect your reputation and customer loyalty.
3.Discounting and bundling:
Discounting and bundling are two strategies that involve offering lower prices or adding
value to your offer to encourage customers to buy more or to buy sooner. Discounting
involves reducing your prices temporarily or permanently, such as by offering coupons,
vouchers, or loyalty programs. Bundling involves combining your products or services
with other complementary or related offers, such as by offering packages, deals, or
upgrades. Discounting and bundling can help you increase your sales volume, clear your
inventory, and attract new customers. However, you also need to be careful not to devalue
your offer, erode your profit margin, or cannibalize your sales.
4.Psychological pricing:
Psychological pricing is a strategy that involves using the psychological effects of numbers,
words, and symbols to influence the perception and behavior of your customers. This
means that you can use various techniques, such as charm pricing, prestige pricing, or
anchoring, to make your prices seem more appealing, attractive, or reasonable.
Psychological pricing can help you increase your conversion rate, enhance your image, and
communicate your value proposition. However, you also need to be ethical and honest with
your pricing, as this can affect your trustworthiness and credibility.
5.Competitive pricing:
Competitive pricing is a strategy that involves setting your prices according to the prices
of your competitors. This means that you need to monitor and analyze the prices of your
direct and indirect competitors, and decide whether to match, undercut, or exceed their
prices. Competitive pricing can help you stay relevant, competitive, and profitable in your
market. However, you also need to consider your costs, value, and differentiation, as this
can affect your sustainability and positioning.
Pricing is a powerful tool that can help you achieve your tourism marketing goals, but it
also requires careful planning, research, and testing. By using these pricing strategies, you
can attract and retain tourists in a competitive market, and create a win-win situation for
both you and your customers.
Tourism promotion:
Tourism promotion means activities and expenditures designed to increase tourism,
including but not limited to advertising, publicizing, or otherwise distributing information
for the purpose of attracting and welcoming tourists; developing strategies to expand
tourism; operating tourism promotion agencies; and funding marketing of special events
and festivals designed to attract tourists.
1. Utilize local listings:
The simplest promotion you can do is registering your business with Google My
Business(opens in a new tab)– it is the new Yellow Pages. The vast majority of people use
Google to find everything. If your business doesn’t show up in all those searches- you are
missing out! A Google listing is basically free advertising for you. The setup process is
quite simple, and then you have complete control to update your listing, add new photos,
or update hours if they change. Follow these steps(opens in a new tab), and include as much
information as possible.
2. Using email newsletters:
Using email newsletters(opens in a new tab) and a customer relationship management
(CRM) program is an easy yet effective strategy for interacting with clients. There are
classic avenues to invite people to sign up for your newsletter, such as built into your
website or Facebook page. Also get creative how and where you ask for subscribers. For
example, find a fun way to circulate a paper sign up sheet during a tour. And be very
thoughtful of the wording you choose. Offer the user the option to subscribe to the
newsletter in order to ‘regularly receive information about current offers’ or ‘hear about
our seasonal tours’. Offer a newsletter that is relevant and interesting to your prospective
customer. Prospective customers have different interests compared to people who already
know how great your tours are.
3. Showing online banners:
Considering internet marketing tools(opens in a new tab) for the tourism industry is
crucial. One of the most effective promotional ideas tourism businesses can employ is to
invest in online advertising. Placing ad banners on certain websites, where users will be
able to see your current promotions and offers, is a great idea to get more exposure. The
websites you advertise on should be the types of sites your target audience visit. Be careful
that you’re placing your ads where your ideal customer is visiting, otherwise you could be
marketing to the wrong audience and your efforts will be in vain. You can use different
sources and sites to place banners, just use top keywords in your Google search, like ‘top
hotels’, ‘travel’, ‘top destinations’, etc.
4. Paid social media marketing:
You can use SMM(opens in a new tab) (social media marketing) tools and targeted
advertising to get in front of your ideal audience on social networks, such as Facebook and
Instagram. Paid advertising on Facebook is extremely easy to set up(opens in a new
tab) and monitor. Moreover, targeting a specific audience has been perfected by Facebook,
so even a novice will be able to see results with their paid FB ad campaigns. Or, consider
reaching out to SMM specialists who know how to promote your travel channels, it is the
most effective way to advertise your tours.
5. Applying offline promo:
Good ol’ fashioned business cards are crucial, especially for travel and tourism businesses.
They are extremely useful and cost-effective. With help (in the form of
developing multiple marketing strategies, not relying on one), they can really improve the
reputation of your brand, increasing the likelihood of interest from travelers and tourists.
Classic postcards are a great direct marketing tool for tourism marketing and travel agents.
By sending a colorful postcard with a wonderful landscape of a tourist destination and a
small message to potential customers, you will definitely convince them to contact you. I
can imagine the star eyes now, when a person longing for a vacation finds a pretty postcard
in their mail.
There is no better way to present a brief and interesting overview of the services offered
by your travel business than high-quality flyers and brochures. With brand-oriented design,
your travel brochures will resonate with your audience and generate interest in your brand.
6. Checking the contextual advertising and SEO:
Contextual advertising (advertising on a page that is relevant to your business) and SEO
optimization are types of promotional activities that are aimed at end-users who use search
engines such as Google to be able to select their desired tour.
Ok, so contextual advertising is basically placing an advertisement in a location that is
relevant. For example, a promotional ad for a gym membership with an athletic clothing
company. Consider what type of person books your tours, how they learn about your
company, and put your paid advertisements in locations relevant to this audience. Learning
more about this type of advertising will improve your techniques, and also help inform
your marketing strategies as you grow your business
SEO optimization is a hot topic! It is also dynamic and constantly evolving, which can
make it an intimidating area to become familiar with.
7. Using tourist promo videos:
The popularity of video content is constantly growing. It is also easier than ever to make a
high quality video. These trends are important for the tourism industry to capitalize on. If
you are trying to boost sales and grow your business… showing people all the fun they can
have on your tours is obviously the way to go! Using positive testimonials, as well as
photos and videos of your clients enjoying themselves on your tour is the best way to
demonstrate the value in what you offer. It is easy to hire a freelance videographer to make
a short promo video highlighting your fun tours.
Government Administrative System:
Administration-I is a key Division of the Ministry responsible for handling all
establishment matters, allocation of work among various Divisions of the Ministry and
transfer/ postings of officials of the Ministry within India and abroad. It deals with
appointment, recruitment and promotion of the officials involving reference to and from
the Union Public Service Commission (UPSC), The Appointments Committee of the
Cabinet (ACC), The Department of Personnel & Training and Staff Selection Commission
(SSC). It is entrusted with framing Recruitment Rules for various posts of the Ministry. It
deals with retirement of officials, verification and grant of terminal benefits.
In addition to the functions cited supra, it deals with misc. Establishment matters of the
Ministry viz. grant of Leave, Leave Travel Concession, encashment of leave, verification
 of character and antecedents, forwarding application of officials for working on deputation
to other departments, maintenance of service records, Grant of MACP, fixation of pay,
verification of service, training, disciplinary proceedings, review of officials under FR
56(j) etc.
Ministry of Tourism, India – Important Facts
The Ministry of Tourism in India is the nodal agency for promoting tourism in India. The
Ministry of Tourism makes programmes, formulates national policies, and coordinates the
activities of various central government agencies, state governments, union territories, and
private agencies for the promotion of tourism in India.
 The Ministry of Tourism in India is headed by the Union Minister for Tourism and
Ministers of State.
 Currently, the Minister of Tourism is G Kishan Reddy.
 The Ministers of State for Tourism are Ajay Bhatt and Shripad Yesso Naik.
 The Secretary of Tourism is the administrative head of the Ministry of Tourism.
 India Tourism Development Corporation Limited (ITDC) is a public sector undertaking
under the Ministry of Tourism.
Ministry of Tourism, India – Roles and Functions
Infrastructure Development
More than fifty per cent of the Ministry of Tourism’s expenditure on plan schemes is
incurred for the development of quality tourism infrastructure at various tourist destinations
and circuits in the States/ UTs. The roles and responsibilities of the Ministry of Tourism,
India, under infrastructure development are given below:
 Conventions and conferences
 Hospitality programmes
 Field publicity, marketing, and promotions
 Tourist information and facilitation
 Release of incentives
Coordinating the Activities of Field Offices and Their Supervision, Regulation:
 Approval of tourist transport operators, inbound tour operators, travel agents, etc.
 Approval and classification of restaurants and hotels.
International Co-operation and External Assistance
 Foreign technical collaboration
 External assistance
 Bilateral agreements
 International bodies
All Policy Matters
 Investment facilitation
 Promotion and marketing
 Manpower development
 Development policies
Top 10 Source Countries for Foreign Tourist Arrivals (FTAs) in India in 2020
The below given top 10 countries constitute around 66% of the total foreign tourist arrivals
in India.
1. Bangladesh
2. United States of America
3. United Kingdom
4. Canada
5. Russia
6. Australia
7. France
8. Germany
9. Malaysia
10. Sri Lanka
Top 8 International Check Posts for Foreign Tourist Arrivals (FTAs) in India in 2020
1. Delhi
2. Mumbai
3. Chennai
4. Haridaspur
5. Bengaluru
6. Kolkata
7. Hyderabad
8. Cochin
United Nations World Tourism Adopt a Heritage Scheme (Ministry of
Organization (UNWTO) – UPSC Notes for Tourism) – Definition, Advantages &
International Relations Action Plan

Swadesh Darshan Scheme| Theme-Based National Tourism Day (25th January)

Tourist Circuits By Ministry Of Tourism – UPSC Notes

Road Ahead for Tourism & Hospitality

500+ Words Essay on Tourism Industry: RSTV- Big Picture

What is Tourism Marketing?

Tourism marketing is a type of marketing used by businesses operating in the travel and
tourism industry to attract tourists to a business name or particular location which can be a
state, a city, a particular heritage site or tourist destination spot, a hotel, or a convention
center anything.
Achieving success in the travel and tourism industry requires thoughtful Tourism
Marketing campaigns that are designed to generate brand awareness, create both, reach the
most target audience or potential customers, drive traffic, foster loyalty among existing
clients, and create a captivating customer experience. By utilizing these strategies,
businesses can effectively engage with travelers while generating more sales opportunities.
Why is Tourism Marketing Important?
To make a tourism business thrive, savvy marketing is an absolute must. By staying up-to-
date with current trends and launching impactful campaigns, businesses can boost the
recognition of their brand, gain customer loyalty and attract travellers. Moreover, tourism
marketing holds promise for contributing to the economic growth of the region by driving
tourists towards local enterprises.
To allow businesses to gain a competitive advantage, marketing is essential. Many of the
top tourism marketing approaches concentrate on highlighting a business’ unique selling
point and broadcasting it effectively. Moreover, marketers must keep abreast with current
trends to generate an effective promotional mix and deploy the most viable methods for
disseminating their message across all channels.
What are the different ways in which Tourism Marketing Can Be Done in 2023?
Now various methods are applied for tourism marketing to flourish. Below are some of
the important ways in which the tourism marking of any place is given a boost.
1) Location marketing:
In this type of marketing strategy, the main focus of tourism marketing is one bringing
people’s attention to a specific location. In this strategy, no recommendations are made
with respect to a particular site or any accommodation. Now some locations are already so
popular all over the world that tourism marketers don’t have to make many efforts to attract
their attention to such places.
Now there s also a popular slogan related to Las Vegas which is ‘What happens in Vegas,
stays in Vegas’. This slogan has gained worldwide popularity and almost everyone wants
to visit Las Vegas at least once.
2) Activity marketing:
Now, this type of tourism is carried out keeping in mind both the location and the activities
that are performed in such places. This type of tourism marketing strategy usually keeps
in mind travelers who are adventure lovers or activity freaks.
There are many other sites and locations all over the world that are famous for some
specific activities. Like Alaska is famous for snowboarding, Yellowstone national park is
famous for thrilling activities like hiking, and camping and is a perfect place for all nature
lovers, similarly, there is ‘Colonial Williamsburg’ which attracts all history lovers.
Thus depending on the target audience and the type of activity that a particular place is
famous for, tourism marketing can be carried out. Some people may be adventure lovers,
some people may be looking for art and culture some people love hunting, depending upon
their area of expertise and interest, the tourism markers can segment the groups of potential
visitors and customers and approach them.
Thus activity marketing is a form of tourism making and social media marketing that
emphasizes the booking process and bringing the attention of a customer to particular
places on the basis of the activities that are performed there.
3) Corporate marketing:
This is quite an interesting approach to tourism marketing. Now it has been found that a
large number of people working in corporate sectors have to travel to different places to
attend a conference or a meeting.
Then according to research, it was found these locations were ideal for tourists, and a
number of people came to attend those places. Also, they brought their families and their
loved ones as well. Now considering these scenarios’ latest trends in mind, corporate
influencer marketing can contribute a lot to tourism marketing as it has significant
potential.
What are the four basic pillars of Tourism Marketing?
The foundation of tourism marketing stands firmly on four of its important pillars which
are the product, the price, the place, email marketing, and the promotion.
Marketing Mix of Tourism:
1) Product in Tourism Marketing:
One of the most important aspects of the tourism marketing strategy is to determine the
effect of the selling benefits and the other types of benefits that are re-obtained by
competing with their rivals in the same market.
Tourism marketers need to focus more on such destinations that provide both business
advantages to travel brands and pleasure to their customers. These pleasures depend on
several factors like the ease of traveling, facilities of the sites and the hotels, the nightlife
of that place, activities offered, and the overall culture of that place.
2) Price in Tourism Marketing:
The price point is yet another important aspect of tourism marketing. Now many people
avoid traveling due to money-related issues. And this is where tourism marketing comes
in to save the day. Today so many mobile apps have been developed, on which if a person
books a hotel r a transport like a flight or a train, they get discounts. This attracts a lot of
customers.
Along with the free referral marketing, they also try to give value-added services to their
customers. Some hotels also offer free shuttle services to their visitors. Also depending on
whether it is a high season or an offseason, the prices are altered.
3) Place in Tourism Marketing:
Now for tourism marketing to earn a profit, deciding the location where they want to
perform the marketing can play a key role in how far they can go. The place refers to the
area where the products and services can be distributed.
Now in tourism and destination marketing, the location and the destination marketers offer
their products and services to their customers through travel agents, tour operators, inside
sales teas, etc. The distribution of their products and services to visitors can be done
through catalogs, online, sites, mobile devices, websites, stores, etc.
4) Promotion:
In this numerous different strategies and technologies are used for the promotion of any
specific area or tourist destination. In fact, trade magazines and meeting planners are also
efficient ways for promotion purposes.
These often come with many other forms of discount coupons, brochures, etc. also they try
their target customers to come across the ads that pop up on the website to make them
aware of the various tourist places.
15 Tourism Marketing Strategies in 2023:
1. Prioritising Hygiene and Safety Via Marketing Communication:
Tourism marketers must now prioritize safety and hygiene to give their customers peace
of mind when they travel. By highlighting the protocols that are being taken, tourists can
rest assured knowing they will be protected while visiting.
2. Developing Loyalty Programmes
Loyalty programs are the ideal way to demonstrate your appreciation for existing
customers and stimulate repeated patronage. Tourism marketers should construct loyalty
programs that will not only retain existing customers but also appeal to fresh audiences.
3. Capitalising on Voice Search
In the age of voice search, it is essential for tourism marketers to create content that can be
quickly found and accessed. Optimizing your site and content for this new technology will
bolster your site for visibility and success in the long term.
4. Facilitating User-Generated Content
User-generated content, such as ratings and reviews on social media, is critical in helping
customers make informed decisions. User-generated social media content is one of the key
tourism marketing trends.
5. Deploying Artificial Intelligence:
AI technology is a valuable asset for Tourism marketers, allowing them to track customer
behavior and create personalized brand experiences tailored to each individual. This can
help customers find the brand information they need quicker and more easily than ever
before.
6. Not Neglect Review Marketing
Reviews and ratings are a critical resource for Tourism companies, making them an
invaluable asset in swaying potential customer decisions. Any Tourism marketer must
recognize the importance of reviews if they wish to stay competitive.
7. Enhancing the Guest Experience & Satisfaction Through Chatbots
Chatbots can be a vital tool in creating an effortless, tailored experience for all customers.
Chatbot technology should be a top priority for the hospitality and tourism industry to
provide quick customer service and support, as well as respond promptly to any inquiries.
8. Investing in Remarketing Efforts
Maximizing your Tourism business’ potential by tapping into already engaged customers
is a surefire way of increasing sales. Leverage the power of remarketing to maximize your
potential and gain more qualified leads.
9. Utilising Augmented Reality Technology
Augmented reality provides the ideal platform for tourism businesses to build mesmerizing
and unforgettable experiences for their customers.
10. Prioritising Personalisation
Customization is a crucial element of this form of marketing. By personalizing content and
messages to the target audience’s wants and needs, Tourism marketers can engineer and
create an experience that will ensure positive word-of-mouth publicity for their business or
brand.
11. Exploring Metaverse
The metaverse is becoming more and more popular with tourism companies, as it allows
them to give their customers an unparalleled, immersive experience.
12. Using NFTs
Non-fungible tokens, or NFTs, are quickly becoming a widely recognized trend. Tourism
companies can harness this technology to propel their marketing campaigns and draw in
more visitors.
13. Promoting Virtual Reality (VR) Tours
Allow your customers to explore new destinations without even having to leave their
homes – with VR tours, the possibilities are endless!
14. Focusing on the Customer Experience
Crafting an exceptional customer experience should be the primary focus of any
Tourism promotional strategy. Optimizing customer experiences on all marketing
channels is crucial.
15. Embracing content and influencer marketing
Content and influencer marketing are essential building blocks of any successful tourism
strategy. It helps in optimizing the presence of a travel business in the search engine.