Many local travel agencies began hosting below-cost inbound tours, dubbed "zero-fee tours", for mainland Chinese tourists. By bringing these tourists to shop in designated retail outlets that charge costs inflated but offer profitable commissions to tour operators, they make a profit. Zero- because they spent too little while shopping when a group of tourists were left at a pier fee tours first caught the public's attention in October 2006.
Zero-Fee Tours An Irresistible Bargain or a Sinkhole case solution
Then in June 2010, a tourist died of a heart attack after a heated discussion using a tour guide above a shopping layout. Despite preventive measures implemented by the business association, tourist gripes keep increasing and high profile cases in which tour guides insult or even fight with tourists continue to happen. Travel Limited, a local travel agency that hosts consistently priced inbound tours. Confronting strong market demand for zero-fee tours, it would like to comprehend the business model of zero-fee tours: what's the driving force, is it sustainable, and what are the impacts to the company and the entire sector? In addition, it wants to determine how to place its inbound tour company in the short and long term.
PUBLICATION DATE: June 12, 2012 PRODUCT #: HKU972-PDF-ENG
This is just an excerpt. This case is about SALES & MARKETING
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