What is meant by vertical integration in tourism?

Vertical integration in tourism refers to the strategy where a company expands its operations by acquiring or merging with businesses at different levels of the supply chain. This can involve a tourism company taking over other businesses that might be suppliers, distributors, or other related service providers, allowing for greater control over the production and distribution of services.

By implementing vertical integration, a tourism company can streamline operations, reduce costs, and enhance customer experience by ensuring that all parts of the service—from initial travel booking to accommodations and tour services—are managed under one corporate umbrella. This strategy can lead to increased efficiencies, improved quality control, and a more consistent brand experience for customers, making it a popular approach in the tourism industry.

In contrast, the other options focus on different business strategies. Joining companies that offer similar services relates more to horizontal integration, which is about merging or collaborating with competitors. Collaboration among local hotels for shared marketing is more about cooperative marketing efforts rather than integrating business operations. Lastly, focusing exclusively on tourism marketing services describes a specific niche strategy that doesn’t encompass the broader operational integration that vertical integration entails.