International Perspectives on Destination Management and Tourist Experiences

Bernd Eisenstein and Sonja Göttel

Cooperative Destination Development: Advantages, Challenges and Success Factors

1.   Destination Management Seen from a Network Perspective

The discourse in tourism literature has led to a differentiated understanding of tourism destinations, uniting demand-oriented and process-oriented as well as network approaches. This chapter looks at destinations from a network perspective, arguing that destinations represent strategic networks that are highly dependent on the effectiveness of strategic and sustainable network management. The chapter highlights important advantages and challenges found in cooperative destination development. It further emphasises strategic success factors for long-lasting network management and cooperative destination development.

Tourists compare different destinations within their decision-making process and choose the destination that best fits their needs (Bieger & Beritelli, 2013). In order to satisfy their individual needs, tourists choose a set of complementary products and services that are perceived as a common product or product bundle rather than as individual services. These product bundles are commonly provided by a network of local and regional tourism actors (private as well as public) and the destinations serve as the competitive units that represent the product bundles (Eisenstein 2014; Laux, 2012; Pechlaner, 2003). In this way, destinations function as overlapping competitive units in competition with other destinations that offer comparable target-adequate services to the potential visitor (Eisenstein, 2014). Following this approach, destinations can be understood as inter-organisational strategic networks of co-producing actors (Baggio, 2011; Haugland, Ness, Grønseth, & Aarstad, 2011; Laux, 2012; Meriläinen & Lemmetyinen, 2011). A tourism network represents a strategic organisational form comprised of more than two legally independent, but economically partly inter-dependent actors with the aim of realising competitive advantages. Relationships between the network actors are usually complex-reciprocal, cooperative and rather stable (Laux & Soller, 2012; Meriläinen & Lemmetyinen, 2011; Saretzki, 2007).

The growth in implementation of cooperation and networks can be seen as a result of increasingly dynamic economic environments and a new era of complexity and uncertainty (Ruckdäschel, 2015). Correspondingly, increased complexity and dynamics in tourism have led to a higher importance of regional cooperation as a basis for generating unique local and regional marketing propositions, success ← 11 | 12 → ful branding and sustainable tourism development (Laux, 2012; Scherhag, 2007). Some authors even constitute a fundamental shift in the population as a whole towards a ‘networked society’ incorporating all aspects of life (Castells 2010).

In the context of cooperative destination development, there is a strong link between the success of individual companies within a destination and the prosperity of the destination as a whole (Saretzki, 2007). Hence, the simultaneity of cooperation and competition (co-opetition) is a characteristic element of cooperation in destination management (Laux, 2012; von Friedrichs Grängsjö, 2003; Wang, 2008; Wang & Krakover, 2008). Instead of being seen as contradictions, competition and cooperation can be used in a complementary way to achieve competitive goals (Laux, 2012). With reference to this, networks can be seen as a future-oriented model of destination management, as they safeguard the independence of network actors while simultaneously supporting common interests (Saretzki, 2007). As a result, the network density of destinations is increasingly regarded as a major competitive factor in destination management and destination development (Bramwell & Lane, 2000; Eisenstein, 2014; Laux, 2012; Pechlaner, 2003; Saretzki, 2007; Scherhag, 2007; Scott & Laws, 2012).

Taking into consideration the cooperative needs within the planning, production and marketing of the tourism product bundle, destinations can also be seen as “virtual enterprises” (Bieger, 2010, p. 136) which need to be managed and governed as one strategic unit in order to secure long-term competitiveness (Bieger & Beritelli, 2013; Flagestad & Hope, 2001). Consequently, tourism destinations need an institution that coordinates the joint activities and acts as a central coordination unit for the complementary destination product bundle (Eisenstein, 2014).

2.   Advantages of Cooperative Destination Development

The creation of competitive offers and products forms the basis of any regional development through tourism (Hall & Michael, 2007). As mentioned above, in destination management the success of the single enterprise is highly interlinked with the success of the destination as a whole (Saretzki, 2007). Cooperative processes and relationships are paramount for the realisation of the functions and tasks of the destination (e.g. compound products and services) that reach beyond the actionability of single actors and stakeholders (Bogenstahl, 2011; Fuchs, 2013; Pechlaner, 2003; Wang, 2008). Because of this tight inter-relationship, networks can be seen as the input as well as the output of a destination (Tinsley & Lynch, 2001). Networks can support the competiveness of a destination and then profit in return from the generated common competencies (Denicolai, Cioccarelli, & Zucchella, 2010; Haugland et al., 2011). Inter-organisational cooperation offers ← 12 | 13 → the advantage of access to a pool of complementary competencies and abilities that can be used and combined in flexible ways to develop innovative products and enter new markets (Bogenstahl, 2011). Thus, the interconnectedness of actors within a destination becomes a prerequisite for compound product and market development, as well as for achieving benefits of scale. (Pyo, 2012; Scherhag, 2007; Zehrer & Raich, 2012). Especially for smaller enterprises, the interconnectedness of single services along the tourism service chain offers the added value of a ‘virtual’ size increase and an extended range of actions, without giving up independence and autonomy (Laux & Soller, 2012; Lemmetyinen & Go, 2009; Pechlaner & Raich, 2008). Hence, the creation of cooperative networks can help to minimise the disadvantages of micro- and small-scale structures (Laux & Soller, 2012; Lemmetyinen & Go, 2009). Cooperation and networks are often based on a diverse set of interconnected motives and goals; Table 1 gives an overview of the central motives and goals of cooperation.