Domestic vs outbound booking and channel choice behavior evidence from New Zealand

Description
This paper seeks to analyze the extent to which New Zealand domestic and outbound
travelers’ book components of their trip in advance or at their destination and to explore the factors that
influence this. Furthermore, the paper compares the distribution channels used by domestic and
outbound travelers to purchase different travel products and to examine why these channels have been
selected.

International Journal of Culture, Tourism and Hospitality Research
Domestic vs outbound booking and channel choice behavior: evidence from New Zealand
Douglas G. Pearce Christian Schott
Article information:
To cite this document:
Douglas G. Pearce Christian Schott, (2011),"Domestic vs outbound booking and channel choice behavior: evidence from New Zealand",
International J ournal of Culture, Tourism and Hospitality Research, Vol. 5 Iss 2 pp. 112 - 127
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Domestic vs outbound booking and
channel choice behavior: evidence from
New Zealand
Douglas G. Pearce and Christian Schott
Abstract
Purpose – This paper seeks to analyze the extent to which New Zealand domestic and outbound
travelers’ book components of their trip in advance or at their destination and to explore the factors that
in?uence this. Furthermore, the paper compares the distribution channels used by domestic and
outbound travelers to purchase different travel products and to examine why these channels have been
selected.
Design/methodology/approach – The study involves the collection and analysis of data on the pro?les,
trip characteristics and distribution behavior of domestic and outbound travelers based on a nationwide
telephone survey of 1,000 respondents.
Findings – Little variation was found in the pro?le characteristics of domestic and outbound travelers
but signi?cant differences occurred in terms of the trip characteristics, the extent of booking in advance
and at the destination, reasons why advance bookings were not made, how bookings were made and
the channels used all exhibited signi?cant differences according to domestic or outbound travel. This
pattern was less consistent with regards to the factors in?uencing how the bookings were made and the
factors affecting channel choice.
Research and practical implications – The ?ndings illustrate the complexity of travel decision-making
issues, underline the need to take account of differences between domestic and outbound travel and
across trip components, and to examine the factors that underlie distribution related behavior.
Originality/value – The value and originality of this paper lie in the systematic comparison of the
booking and channel choice behavior of domestic and outbound travelers, the search for factors
in?uencing this behavior and a sectoral approach that differentiates transport to and at the destination.
Keywords Tourism, Travel, Distribution channels and markets, Purchasing, New Zealand
Paper type Research paper
Introduction
Signi?cant changes continue occurring in the demand for domestic and outbound travel in
New Zealand. The Ministry of Tourism’s (2006) recent report suggests a major structural shift
is occurring whereby outbound travel is substituting for domestic tourism. Domestic visitor
nights declined from 66.7m in 1999 to 51.8m in 2005. The pattern of domestic overnight
expenditure over this period has been variable: $3.81b in 1999; $4.94b in 2003; $4.17b in
2005. In contrast, short-term departures doubled over the period 1995-2005 to reach 1.8m;
the report identi?es a twofold increase on expenditure on overseas travel, and an increase in
gross travel propensity from 25 to 45 percent. The authors attribute much of this change to
favourable economic factors and intense competition in short-haul air travel which has seen
the cost of international travel decrease relative to the cost of travelling domestically.
However, despite this trend domestic tourism continues to make a signi?cant contribution to
the New Zealand economy.
Against this background the need to understand the factors that in?uence consumer behavior
becomes increasingly important for those marketing both domestic and international
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Douglas G. Pearce and
Christian Schott are both
based at the Victoria
Management School,
Victoria University of
Wellington, Wellington, New
Zealand.
Submitted: February 2008
Revised: July 2008
Accepted: November 2008
The authors gratefully
acknowledge funding from the
Foundation for Research,
Science and Technology, as
part of the ‘ ‘Innovation in New
Zealand tourism through
improved distribution
channels’ ’ project.
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destinations. This is especially so with regard to distribution-related behavior as distribution is
increasingly being recognized as a critical source of competitive advantage in the marketing
mix. In this regard Kotler et al. (1996, p. 473) observe: ‘‘Designing the distribution channel
starts with determining the services that consumers in various target segments want [. . .]’’ Yet,
few studies so far have systematically compared the behavior of domestic and international
travelers with regard to such distribution-related matters as booking, purchase and channel
choice. To date, most of the marketing studies involving domestic and international tourists
consider issues such as image, perception and demand modelling (Demir, 2003; Yuksel,
2004; Awaritefe, 2004; Bonn et al., 2005; Salman et al., 2007). Studies that have compared
aspects of distribution have usually taken a destination-based approach and dealt with
complementary segments (domestic/inbound) rather than competing ones
(domestic/outbound) (Pearce and Schott, 2005; DiPietro et al., 2007).
In such a context this paper aims to analyze the extent to which New Zealand domestic and
outbound travelers book components of their trip in advance or at their destination and
explore the factors that in?uence this; and to compare the distribution channels used by
domestic and international travelers to purchase different travel products and examine why
these channels have been selected.
Thus, while the focus is on New Zealand, the problem addressed and the approach taken
have a much more general application and the paper seeks to make a broader contribution to
the literatures on travel behavior, tourism distribution and domestic and international travel.
Literature review
Two frequently non-convergent literatures address the distribution-related behavior of travelers:
one dealing with tourism distribution, the other with tourist decision-making more generally. In
the former, the ways in which different distribution channels are employed to reach particular
market segments are a central part of the research, but the perspective taken has generally
been that of the suppliers and intermediaries while the consumers’ views and behavior are
often only considered indirectly (Buhalis and Laws, 2001; del Alca´zar Mart? ´nez, 2002; Pearce
et al., 2007). Relatively few authors have positioned the analysis of travel behavior squarely in
the context of distribution (Pearce and Schott, 2005; Smith, 2007). More commonly, aspects of
distribution-related behavior are considered in the broader tourist decision-making literature,
with a particular emphasis on information search (Fodness and Murray, 1997; Gursoy and
McCleary, 2003; and Cai et al., 2004) and to a lesser extent booking and purchase (Woodside
and King, 2001; Card et al., 2003; Wolfe et al., 2004; Jun et al., 2007).
A key theme that comes through in these inter-related ?elds of study is the complexity of the
distribution process and the associated tourist behavior. Part of this complexity arises out of
the increasingly diverse range of direct and indirect channels available to channel members
online (O’Connor, 1999; Green, 2005) and of?ine (Pearce and Tan, 2006; Pearce and Sahli,
2007). Both the supply-side and behavioral studies emphasize variations in the use of
different channels by market segment and sector, although certain commonalities are also
found (Card et al., 2003; Wolfe et al., 2004; Jun et al., 2007; Pearce and Sahli, 2007; Pearce
et al., 2007). Recent supply and demand side studies further highlight the spatial and
temporal complexity of distribution, drawing attention to issues of the timing and location of
distribution functions, differentiating activities that occur pre-trip and in transit from those
carried out at the destination (Bieger and Laesser, 2004; Fesenmaier and Jeng, 2004;
Pearce and Tan, 2004; DiPietro et al., 2007; Hyde, 2006; Jun et al., 2007).
In many of these empirical studies the analysis is limited to the patterns of behavior with the
authors subsequently speculating on why they have come about. In their ‘‘at destination’’
study of information sources, for example, DiPietro et al. (2007) found that lodging and
transportation decisions were primarily made prior to departure while ‘‘at destination’’
decisions related more to dining and entertainment, with differences occurring in the latter
between domestic and international travelers. Similarly, Jun et al. (2007) considered the level
of agreement between pre-trip information search and purchase behavior using online and
of?ine sources across six product categories. Differences were found and interpreted in
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terms of the type of products. In carrying out an at-destination study of domestic and
international visitors travel behavior in Wellington and Rotorua, Pearce and Schott (2005)
explicitly examined the factors underlying aspects of distribution behavior as well as
detailing patterns of channel use. Ease and convenience was the dominant in?uence on
channel choice; secondary factors included those related to price and payment, time and
availability.
Most of these empirical studies have not been underpinned by a substantial and explicit
conceptual framework. By synthesizing and reinterpreting a large body of empirical material
from New Zealand in light of the fundamental principles of distribution, Pearce (2008)
developed a generalized model of tourism distribution. The needs of the different segments
are expressed here in terms of the broader form, possession, time and place utilities
identi?ed by Stern and El-Ansary (1992). Time and place utility refer to when and where the
various services sought by different market segments are needed; possession utility relates
to when and where tourists need to book and pay for which services.
Pearce’s model shares some similarities with channel choice models developed in other
sectors but it also highlights some of the speci?c attributes and particularities of tourism
distribution. Schoenbachler and Gordon (2002) developed a model of multi-channel
shopping behavior based on ?ve key factors: perceived risk, past direct marketing
experience, motivation to buy from a channel, product category and web site design. Black
et al. (2002) focused on consumer choice of distribution channels in the ?nancial services
sector, noting that most work in that ?eld examined the factors in?uencing the adoption of
new channels or buying behavior in general rather than channel choice in particular; a
similar situation occurs with tourism. They then proposed a model of product channel
selection involving the interaction of four sets of factors: consumer, product, organization
and channel. Both papers developed a set of propositions to test the importance of these
factors and the inter-relationships between them but report no empirical ?ndings.
The importance of product categories is common to all three models, in the case of tourism
this is expressed as different sectors (e.g. transport, accommodation and attractions), and a
range of factors directly in?uencing channel choice are identi?ed. While Pearce’s model
does not include risk it is an explanatory factor mentioned in some of the empirical tourism
studies (Money and Crotts, 2003; Jun et al., 2007). A key difference between the tourism
model and the shopping and ?nancial services models is the spatial component, with the
nature of tourist travel opening up a wider range of possibilities in terms of the time/space
utilities included in Pearce’s framework; that is, carrying out functions in the origin or at the
destination. The time/space utilities associated with tourist travel also give greater weight to
the practice of booking compared with many retail activities.
All three models emphasize that a range of consumer characteristics are likely to
in?uence channel choice but none deals with differences between domestic and
international consumers. Earlier, Buhalis (2000, p. 111) had observed that ‘‘domestic
tourists usually make direct arrangements and often use their own transport, whereas
international leisure travelers tend to be more in?uenced by intermediaries’’. He did not
elaborate on why this is so but Pearce and Schott (2005) found signi?cant differences
between domestic and inbound international visitors in terms of several facets of their
distribution-related behavior where the patterns generally support Buhalis’s observation.
In the light of some of the other studies there are also good a priori reasons why
differences might be expected between domestic and outbound travelers. If perceived
risk is a key factor in channel choice behavior, then the risks of international travel might
be expected to be greater than those for domestic trips given the usually greater
distances involved and the lesser familiarity with the destination. For these same reasons
ease and convenience may be more signi?cant factors in channel choice involving
international trips compared with those made domestically.
At the same time, while differences in the behavior of domestic and outbound travelers might
be expected, the amount of work done in this area does not yet provide a suf?cient basis to
hypothesize what the nature and strength of those differences might be, suggesting that for
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an exploratory study such as this a more open-ended approach is appropriate.
Considerable scope thus exists to extend this research with more detailed empirical
studies that explore the booking and channel choice behavior exhibited by domestic and
outbound travelers for products at different phases of their trip and to examine the reasons
underlying this behavior.
Method
A nationwide household survey was deemed to be the most appropriate means of data
collection to pursue the aims of analyzing differences in the behavior of domestic and
outbound travelers. This approach enables domestic and outbound travelers to be drawn
from the same sample frame, allows for the full range of trips taken and distribution
channels used to be incorporated, and provides greater scope for ‘‘why-type’’ questions
to be explored – these latter issues are often problematic in ‘‘at destination’’ intercept
surveys.
To this end a specially commissioned nationwide telephone survey was undertaken by an
established national survey research ?rm using computer assisted telephone interviewing
(CATI). Random digit dialing was used to derive a representative national sample of New
Zealand residents over the age of 18 who were involved in the planning of either an overseas
or domestic trip of two or more nights which they had taken within the previous 12 months.
Participants were telephoned at their homes on weekdays, evenings and weekends
between November 20 and December 17, 2006.
One thousand interviews were completed, representing an effective response rate of 10.5
percent. Quotas were set for 500 respondents who had taken an overseas trip and 500 who
had traveled domestically. Provision was also made for respondents who had taken both
forms of trips to provide details on each and 94 individuals elected to do so. This resulted in
information being collected on 546 outbound trips and 548 domestic ones.
When checked against national migration statistics for short-term departures from New
Zealand the outbound sample was found to be largely representative along a variety of
dimensions including the regional propensity for outbound travel. The sample very closely
approximates the pattern of international departures in terms of destinations visited. The
mean trip length of the sample (19.6 days) is virtually identical to that of the national
migration statistics (19.5 days). Directly comparable data are less readily available for
domestic travel but ?gures on overnight trips from the Ministry of Tourism (2006) suggest
some regional under- and over-sampling. In terms of gender, there is a skew to female
respondents (64 percent) for domestic and outbound respondents.
The questionnaire was structured around an introductory set of questions relating to the trip
characteristics of the respondents’ last overseas or domestic trip, followed by the main set of
questions relating to their distribution behavior before concluding with a set of pro?le
questions. As one of the key objectives of the study was to examine distribution behavior
across a range of functions and travel components (transport to and at the destination,
accommodation, attractions and activities) consideration had to be given to keeping the
questionnaire to a manageable length. This resulted in respondents being asked to answer
the questions with respect to the main destination they traveled to, the main channels they
used and so forth. In terms of destinations, differences occur with regard to the scale at
which this was recorded for the domestic and outbound travelers – for the former it was the
place they went to, for the latter, the country they visited. Each questionnaire took on average
just under 18 minutes to complete. The majority of the questions were open-ended. For
example, respondents were asked questions such as ‘‘Why did you book your transport at
the destination in this way?’’ and ‘‘Why did you decide to purchase the accommodation
component of your trip from this travel provider?’’ A pilot study of 50 respondents was
conducted to pre-test the questionnaire and methodology; as a result minor changes were
made to the questionnaire. The results from the pilot survey also assisted the researchers in
developing a coding frame used in the CATI process, for example compiling a list of factors
that in?uenced the way respondents made their bookings or determined their channel
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choice. The coded data ?le was then made available to the researchers who analyzed it
using SPSS.
The analysis begins with an examination of the pro?le characteristics of the respondents
segmented into three categories: those who took a domestic trip, an international trip, and a
smaller group who traveled both domestically and internationally in the last 12 months. The
subsequent analysis and presentation of the results is based on the two sets of trips;
domestic and outbound. After the trip characteristics are compared, consideration is given
to the extent to which booking occurs in advance of the trip or at the destination and which
factors in?uence this pattern. The type of channels used for booking and purchase and the
reasons for their selection are then analyzed. Following Pearce’s (2008) needs-functions
model, the analysis examines these questions with regard to the four main classes of travel
products or trip components: transport to the destination, transport at the destination,
accommodation and attractions and activities. The distinction between transport to and at
the destination has largely been neglected in previous studies but is crucial as it often
involves different modes and costs and thus, a priori, different patterns of distribution.
Consideration is also given to how those purchasing packages arrange their travel.
Statistical differences in the patterns of domestic and outbound travelers and trips are tested
using chi-square. Some variations occur from table to table in the way in which the data are
reported. First, only relevant responses are included; for example, respondents were not
asked how they had booked and purchased their transport and accommodation when they
were traveling by private car or staying privately. In Table I, the responses of those who had
not made any bookings at all in advance are reported globally at the bottom of the table
under the category ‘‘No bookings made at all’’. The component speci?c responses relate to
those who had booked some but not all components in advance: the responses relate to why
they had not booked particular components and are thus variable in number. In all tables the
small percentage of non-responses is excluded from the analysis and small similar
categories have been merged or included under ‘‘other’’. In cases where the data did not
meet the assumptions of the chi-square test (notably there were more than 20 percent of
cells with expected frequencies of less than 5), the signi?cance level for the Likelihood Ratio
(LR) is reported (Cavana et al., 2001). In Tables II and III differences are reported as
statistically signi?cant at the p ¼ 0:05 level. The Bonferroni correction has been used to
adjust the signi?cance levels in Tables I and IV-VIII to take account of the effects of multiple
testing (Kang et al., 2007).
Results
Pro?le characteristics
Analysis of the pro?le characteristics of the three groups of respondents reveals few
statistically signi?cant differences (Table II). No signi?cant differences are found at the 0.05
level for gender, occupation, locality (city, town, rural), access to the internet or internet use.
Signi?cant differences occur with respect to age and region. The outbound travelers are
older than the domestic travelers. There are proportionally more outbound travelers in
Auckland and Northland.
Trip characteristics
An examination of the key trip characteristics identi?ed that all but one variable display
statistically signi?cant differences between domestic and outbound trips (Table III).
Proportionately more outbound trips are for holidays and a greater share of domestic trips
are for ‘‘other’’ purposes (e.g. sports, education, and health). The majority of trips in each
case involve a repeat visit but the proportion of these is much higher for domestic (87.4
percent) than for outbound trips (69.5 percent). Similarly, there is a larger proportion of
independent travel on domestic trips (88.9 percent) compared to overseas ones (69.5
percent). Other outbound trips involve a higher share of packages (10.6 percent) and an
intermediate category designated ‘‘package plus’’ (19.9 percent) on the basis that
respondents had indicated that ‘‘some of my travel arrangements were part of a package
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Table I Reasons why bookings for domestic and outbound trips were not made in advance
Component Domestic Outbound Total
Transport to destination (n ¼ 186) % (n ¼ 32) % (n ¼ 218) %
Used private vehicle 97.3 0.0 83.0
Did not need to 2.2 65.6 11.5
Someone else booked/organized 0.5 31.3 5.0
Urgent trip 0.0 3.1 0.5
x
2
¼183.913 sig. ¼ 0.000*
Transport at destination (n ¼ 307) % (n ¼ 286) % (n ¼ 593) %
Used private/company vehicle 73.9 33.6 54.5
Used public transport 10.0 30.1 19.7
Others provided transport 4.2 8.0 6.1
Unsure what was going to do 3.3 7.7 5.4
Did not need any 4.2 3.5 3.9
Was not traveling around 2.9 4.5 3.7
Other 0.3 7.3 3.7
Someone else booked/organized 1.0 2.4 1.7
Flexibility/spontaneity 0.0 2.8 1.3
x
2
¼114.563 sig. ¼ 0.000*
Accommodation (n ¼ 117) % (n ¼ 188) % (n ¼ 305) %
Stayed with friends/relatives 88.0 78.7 82.3
Other 2.6 10.6 7.5
Unsure what was going to do 3.4 4.8 4.3
Someone else booked/organized 4.3 2.7 3.3
Prefer to book once arrive 1.7 3.2 2.6
LR ¼ 9.571 sig. ¼ 0.048
Attractions and activities (n ¼ 322) % (n ¼ 393) % (n ¼ 715) %
Did not want to visit/do anything 34.2 32.1 33.0
Prefer just to turn up 14.3 9.7 11.7
Went for other reasons 14.6 8.7 11.3
Unsure what was going to do 8.7 11.5 10.2
Prefer to book once arrive 5.9 13.2 9.9
No need/been before 2.5 9.9 6.6
Did not know what was on offer 3.1 4.8 4.1
Other 2.8 4.6 3.8
Flexibility/spontaneity 4.7 2.5 3.5
Someone else booked/organized 3.4 3.1 3.2
Time related 5.9 0.0 2.7
x
2
¼63.085 sig. ¼ 0.000*
No bookings made at all (n ¼ 129) %
No need 60.5
Flexibility/spontaneity 10.9
Went for other reasons 10.1
Prefer to book when arrive 9.3
Someone else booked/organized 7.0
Price related 1.6
Off-season 0.8
Note: * Signi?cant at the 0.0125 level (Bonferroni correction was used, 0.05/4 ¼ 0.0125)
Table II Respondent pro?le attributes according to type of travel
Pro?le attributes x
2
df sig.
Gender 1.181 2 0.554
Age 33.409 12 0.001
Occupation (LR) 29.834 22 0.123
Locality 2.542 4 0.637
Region (LR) 57.158 28 0.001
Access to internet 3.951 2 0.139
Internet use 7.918 8 0.442
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and some were made independently’’. The mean length of trips abroad (19.6 nights) is
almost four times that of trips within the country (5.6 nights), but there is no signi?cant
difference in the mean number of traveling companions (2.7 on domestic trips, 2.5 on
outbound trips).
Booking in advance and at the destination
Table IV depicts the booking patterns for domestic and outbound trips showing which
components are booked in advance and which are booked at the destination. Signi?cant
differences occur between the two segments for the four main components with those
traveling overseas showing a greater propensity to book in advance compared to those
traveling domestically. Advance bookings for transport to the destination are made for
virtually all outbound trips but only 41.8 percent of domestic trips. Just under half of the
transport at international destinations is booked in advance compared with 18.4 percent of
transport at destinations within New Zealand. Accommodation is the second most important
sector in terms of advance bookings, with outbound travelers (66.5 percent) again showing
a greater propensity to book ahead. In contrast, relatively lowlevels of bookings are reported
for attractions and activities but those for outbound trips (28 percent) are twice as common
as on domestic trips (14.8 percent). Only a small proportion of both domestic (1.8 percent)
and outbound travelers (2.8 percent) book any other products (e.g. restaurants) and will not
be considered further here. In all but 3.3 percent of outbound trips some form of reservation
is made ahead of travel but almost a quarter of the domestic trips involved no advance
bookings at all.
Two-thirds of the domestic and half of the outbound respondents report making no bookings
at all once at the destination. At destination bookings for transport are signi?cantly more
frequent for outbound travelers than for domestic but this is not the case for accommodation.
For both components the levels of booking are much lower than those made ahead of travel.
The difference between domestic and outbound trips is statistically signi?cant for attractions
and activities. At destination bookings for this component are comparable to those made
prior to departure and are similar to the booking levels for transport and accommodation at
the destination. Reservations for other products are again minimal and the differences not
signi?cant.
Table III Domestic and outbound trip characteristics
Domestic Outbound Total
Characteristics (n ¼ 548) (n ¼ 546) (n ¼ 1094)
Purpose of visit (%)
Holiday/leisure 35.9 52.8 44.4
VFR 36.1 30.7 33.4
Business 15.7 12.1 13.9
Other 12.2 4.4 8.3
x
2
¼42.824 sig. ¼ 0.000
First/repeat visit (%)
First 12.6 30.5 21.6
Repeat 87.4 69.5 78.4
x
2
¼52.104 sig. ¼ 0.000
Travel arrangements (%)
Independent 88.9 69.5 7.6
Package 4.6 10.6 13.2
Package plus 6.6 19.9 79.2
x
2
¼63.070 sig. ¼ 0.000
Length of stay (mean)
Nights 5.6 19.6 12.6
t-value 9.869 sig. ¼ 0.000
Number of companions (mean)
Companions 2.7 2.5 2.6
t-value 20.568 sig. ¼ 0.570
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The majority of the domestic travelers who make no bookings at all in advance report that
there simply is no need to, for example, because they are traveling by private vehicle,
staying with friends and relatives and not visiting any attractions or activities (Table I). Others
though cite ?exibility/spontaneity (10.9 percent) or indicate that they prefer to book once
they arrive (9.3 percent). No comparisons with the small (3.3 percent) proportion of
outbound travelers is possible here as it had not been anticipated that no advance bookings
at all would be made on such trips and thus reasons for not doing so were not sought in the
survey. In terms of the speci?c components, with the exception of accommodation
statistically signi?cant differences are found between the domestic and outbound trips in
terms of the reasons for not making bookings in advance. Virtually all domestic travelers who
book no transport to the destination are traveling by private car, as are three-quarters of
domestic respondents in terms of travel at the destination. Outbound travelers not booking
transport at the destination frequently have access to private vehicles, use public transport
or transport provided by others. Domestic and outbound respondents not booking
Table IV Pattern of advance and at destination booking on domestic and outbound trips
Component Domestic Outbound Total
Booked in advance
Transport to (n ¼ 546) % (n ¼ 546) % (n ¼ 1092) %
booked 41.8 92.3 67.0
did not book 58.2 7.7 33.0
x
2
¼315.666 sig. ¼ 0.000*
Transport at (n ¼ 544) % (n ¼ 544) % (n ¼ 1088) %
booked 18.4 47.1 32.7
did not book 81.6 52.9 67.3
x
2
¼101.605 sig. ¼ 0.000*
Accommodation (n ¼ 545) % (n ¼ 547) % (n ¼ 1092) %
booked 54.5 66.5 60.5
did not book 45.5 33.5 39.5
x
2
¼16.590 sig. ¼ 0.000*
Attractions and activities (n ¼ 546) % (n ¼ 546) % (n ¼ 1092) %
booked 14.8 28.0 21.4
did not book 85.2 72.0 78.6
x
2
¼28.196 sig. ¼ 0.000*
Other (n ¼ 541) % (n ¼ 542) % (n ¼ 1083) %
booked 1.8 2.8 2.3
did not book 98.2 97.2 97.7
x
2
¼1.014 sig. ¼ 0.314
No component booked in advance (n ¼ 545) % (n ¼ 545) % (n ¼ 1090) %
23.9 3.3 13.0
Booked at destination
Transport at (n ¼ 545) % (n ¼ 542) % (n ¼ 1087) %
booked 9.9 33.0 21.4
did not book 90.1 67.0 78.6
x
2
¼86.237 sig. ¼ 0.000**
Accommodation (n ¼ 545) % (n ¼ 546) % (n ¼ 1091) %
booked 14.3 15.6 14.9
did not book 85.7 84.4 85.1
x
2
¼0.338 sig. ¼ 0.561
Attractions and activities (n ¼ 547) % (n ¼ 543) % (n ¼ 1090) %
booked 13.5 28.4 20.9
did not book 86.5 71.6 79.1
x
2
¼36.242 sig. ¼ 0.000**
Other (n ¼ 543) % (n ¼ 542) % (n ¼ 1085) %
booked 1.5 2.6 2.0
did not book 98.5 97.4 98.0
x
2
¼1.682 sig. ¼ 0.195
No component booked in advance (n ¼ 548) % (n ¼ 545) % (n ¼ 1093) %
68.8 49.5 59.0
Notes: * Signi?cant at the 0.01 level (Bonferroni correction was used, 0.05/5 ¼ 0.01); ** Signi?cant at
the 0.0125 level (Bonferroni correction was used, 0.05/4 ¼ 0.0125)
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accommodation in advance mainly stay with friends and relatives; others are uncertain of
what they are going to do or prefer to book on arrival. About one-third of those on both
domestic and outbound trips indicate they do not want to visit any attractions nor do any
activities but the two segments vary in the relative importance of other reasons for not
booking in advance.
Statistically signi?cant variations occur in terms of how transport to the destination,
accommodation and packages for domestic and outbound trips are booked (Table V). For
instance, while two-thirds of transport reservations for domestic destinations are booked
online, bookings for international travel are shared relatively evenly between online bookings
(42.9 percent) and those made in person (40.9 percent). Almost half of the domestic
accommodation booked is reserved by phone, while a similar share of international
accommodation is booked online.
Table VI shows statistically signi?cant differences in the reasons domestic and outbound
travelers report for making their booking in the way they have for transport to the destination
and for accommodation but not in terms of transport at the destination nor attractions and
activities. Ease and convenience is the dominant factor in?uencing how bookings are made
for both segments across all four components. Price-related factors rank next for transport to
the destination; previous relationships and other factors (e.g. complicated trip, want
?exibility/control) are secondary factors that are more important for international trips than
domestic ones. In terms of accommodation, factors differentiating the selection of the means
of booking include the greater weight attached to price and the lack of choice for
international trips and the speed with which domestic travel bookings are made. The
Table V Means by which bookings were made for domestic and outbound trips
Component Domestic Outbound Total
Transport to destination (n ¼ 198) % (n ¼ 445) % (n ¼ 643) %
Online 65.7 42.9 49.9
In person 8.6 40.9 30.9
Phone 23.7 15.3 17.9
Other 2.0 0.9 1.2
x
2
¼67.282 sig. ¼ 0.000*
Transport at destination (n ¼ 81) % (n ¼ 269) % (n ¼ 350) %
In person 27.2 43.1 39.4
Online 33.3 32.0 32.3
Phone 37.0 20.8 24.6
Other 2.5 4.1 3.7
x
2
¼11.164 sig. ¼ 0.011
Accommodation (n ¼ 279) % (n ¼ 315) % (n ¼ 594) %
Online 36.2 47.3 42.1
Phone 48.0 21.0 33.7
In person 13.6 29.8 22.2
Other 2.2 1.9 2.0
x
2
¼54.111 sig. ¼ 0.000*
Attractions and activities (n ¼ 94) % (n ¼ 197) % (n ¼ 291)
In person 46.8 62.9 57.7
Online 24.5 18.8 20.6
Phone 25.5 14.7 18.2
Other 3.2 3.6 3.4
x
2
¼7.976 sig. ¼ 0.047
Package (n ¼ 59) % (n ¼ 167) % (n ¼ 226) %
In person 10.2 52.7 41.6
Online 42.4 22.8 27.9
Phone 44.1 19.2 25.7
Other 3.4 5.4 4.7
x
2
¼35.871 sig. ¼ 0.000*
Note: * Signi?cant at the 0.01 level (Bonferroni correction was used, 0.05/5 ¼ 0.01)
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distinguishing feature of attractions and activities is that ?exibility/spontaneity ranks second
overall compared to price for the other three components.
Channel use
Table VII demonstrates that different distribution channels are used when purchasing
products for domestic and outbound travel. The differences between domestic and
outbound trips are statistically signi?cant for each of the components examined. Travel
agents are the dominant channel for the purchase of international travel followed by airlines.
The agents play a lesser role for transport to domestic destinations with purchases from
airlines and directly from the operator being more important. For transport at both domestic
and international destinations direct purchases are favored; travel agents and other
intermediaries are important secondary channels for outbound travelers while airlines rank
second for domestic travelers. Direct purchase is the dominant channel for domestic
accommodation; purchases of international accommodation are shared relatively evenly by
direct sales and travel agents. Direct purchase from the operator is also the most common
channel for attractions and activities, especially for domestic trips. Three-quarters of
Table VI Factors in?uencing choice of how bookings were made for domestic and
outbound trips
Component Domestic Outbound Total
Transport to destination (n ¼ 187) % (n ¼ 433) % (n ¼ 620) %
Ease/convenience 70.6 59.8 63.1
Price related 13.4 14.1 13.9
Other 5.9 8.5 7.7
Previous relationship 0.5 8.1 5.8
Habit 2.7 3.2 3.1
Internet related 2.1 2.5 2.4
Faster 3.7 1.4 2.1
Airpoints/Flybuys 1.1 2.3 1.9
x
2
¼21.183 sig. ¼ 0.004*
Transport at destination (n ¼ 69) % (n ¼ 257) % (n ¼ 326)
Ease/convenience 73.9 63.4 65.6
Price related 10.1 9.7 9.8
No choice 2.9 8.6 7.4
Other 10.1 9.7 9.8
Faster 2.9 4.7 4.3
Previous relationship 0.0 3.9 3.1
x
2
¼6.381 sig. ¼ 0.271
Accommodation (n ¼ 261) % (n ¼ 301) % (n ¼ 562) %
Ease/convenience 63.6 56.1 59.6
Price related 7.3 13.6 10.7
No choice 2.3 9.6 6.2
Other 6.5 4.3 5.3
Faster 7.3 1.7 4.3
Previous relationship 1.9 5.3 3.7
Wanted to talk in person 2.3 3.7 3.0
Someone else booked/organized 2.7 3.0 2.8
Flexibility/spontaneity 2.7 1.7 2.1
Habit 3.4 1.0 2.1
x
2
¼40.080 sig. ¼ 0.000*
Attractions and activities (n ¼ 86) % (n ¼ 194) % (n ¼ 280) %
Ease/convenience 59.3 63.9 62.5
Flexibility/spontaneity 14.0 9.3 10.7
No choice 7.0 7.2 7.1
Prefer to talk in person 3.5 5.2 4.6
Price related 2.3 5.2 4.3
Other 14.0 9.3 10.7
x
2
¼4.108 sig. ¼ 0.534
Note: * Signi?cant at the 0.0125 level (Bonferroni correction was used, 0.05/4 ¼ 0.0125)
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outbound travelers purchase their packages from travel agents. The few domestic travelers
who buy a package use travel agents, go directly to the provider or through an airline.
Table VIII depicts the various factors which in?uence the choice of channel in purchasing the
different components of domestic and outbound trips. Signi?cant differences between the
two segments are found in terms of the channel choice factors for buying transport to the
destination, attractions and activities, and packages but not for transport at the destination
or accommodation. In the case of transport to the destination, ease and convenience and
price are the two leading factors but their ranking varies fromdomestic to outbound travel. A
greater proportion of domestic travelers report they had no choice in the selection of the
channel used; this is largely a function of company policy or the preferred provider for
conferences. Previous relationships and service/referral are important secondary factors for
outbound travel. Ease and convenience is the key factor affecting the choice of channel for
attractions and activities, especially on domestic trips. A greater proportion of domestic
travelers again indicate that they have no choice – many attractions and activities operators
in New Zealand focus heavily on direct sales (Pearce and Tan, 2006; Schott, 2007).
Table VII Channels used to purchase domestic and outbound trips
Component Domestic Outbound Total
Transport to destination (n ¼ 195) % (n ¼ 446) % (n ¼ 641) %
Travel agent 17.9 51.3 41.2
Airline 40.0 32.5 34.8
Directly from operator 23.1 7.2 12.0
Via the internet 7.2 5.4 5.9
Other intermediary 8.7 2.5 4.4
Other 3.1 1.1 1.7
x
2
¼83.395 sig. ¼ 0.000*
Transport at destination (n ¼ 82) % (n ¼ 279) % (n ¼ 361) %
Directly from operator 62.2 49.8 52.6
Travel agent 7.3 22.9 19.4
Other intermediary 9.7 9.8 9.7
Airline 14.6 6.5 8.3
Via the internet 3.7 5.4 5.0
Other 2.4 5.7 5.0
x
2
¼16.682 sig. ¼ 0.005*
Accommodation (n ¼ 262) % (n ¼ 322) % (n ¼ 584) %
Directly from supplier 67.6 36.6 50.5
Travel agent 3.4 34.5 20.5
Via the internet 8.8 13.0 11.1
Other 11.8 8.7 10.1
Other intermediary 6.9 3.7 5.1
Airline 1.5 3.4 2.6
x
2
¼103.602 sig. ¼ 0.000*
Attractions and activities (n ¼ 98) % (n ¼ 210) % (n ¼ 308) %
Directly from operator 69.4 43.8 51.9
Travel agent 2.0 26.7 18.8
Other intermediary 12.2 16.7 15.3
Via the internet 7.1 4.8 5.5
Airline 2.0 1.4 1.6
Other 7.1 6.7 6.8
x
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¼31.652 sig. ¼ 0.000*
Package (n ¼ 50) % (n ¼ 167) % (n ¼ 217) %
Travel agent 40.0 76.0 67.7
Directly from operator/supplier 34.0 3.6 10.6
Other intermediary 6.0 9.0 8.3
Airline 14.0 6.0 7.8
Other 6.0 5.4 5.5
LR ¼ 38.175 sig. ¼ 0.000*
Note: * Signi?cant at the 0.01 level (Bonferroni correction was used, 0.05/5 ¼ 0.01)
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Important secondary factors for outbound travelers are price, inclusion in a package and
recommendations. Outbound travelers who purchase packages give a more evenly spread
set of reasons: price-related factors; previous relationships; service/referrals and ease and
convenience. The small number of domestic travelers who buy packages cite ease and
Table VIII Factors in?uencing channels used to purchase domestic and outbound trips
Component Domestic Outbound Total
Transport to destination (n ¼ 182) % (n ¼ 429) % (n ¼ 611) %
Price related 26.4 32.2 30.4
Ease/convenience 31.9 21.9 24.9
Previous relationship 7.1 16.8 13.9
No choice 17.0 3.5 7.5
Service/referral 1.1 10.3 7.5
Airpoints/Flybuys 2.7 7.2 5.9
Part of package 0.0 4.2 2.9
Internet related 6.6 0.0 2.0
Habit 3.3 1.2 1.8
Other 3.8 2.8 3.1
x
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¼104.323 sig. ¼ 0.000*
Transport at destination (n ¼ 73) % (n ¼ 264) % (n ¼ 337) %
Ease/convenience 35.6 38.6 38.0
Price related 21.9 24.6 24.0
Previous relationship 9.6 12.1 11.6
Service/referral 8.2 9.5 9.2
Part of package 4.1 6.4 5.9
No choice 9.6 3.0 4.5
Internet related 2.7 1.9 2.1
Time related 1.4 2.3 2.1
Other 6.8 1.5 2.7
LR ¼ 11.227 sig. ¼ 0.189
Accommodation (n ¼ 247) % (n ¼ 303) % (n ¼ 550) %
Ease/convenience 36.0 31.4 33.5
Price related 22.3 21.8 22.0
Previous relationship 13.4 14.2 13.8
Service/referral 7.3 8.6 8.0
Proximity to event/destination 6.5 4.6 5.5
Part of package 2.4 6.6 4.7
Internet related 4.0 3.0 3.5
Someone else booked/organized 2.4 2.6 2.5
No choice 2.4 1.7 2.0
Other 3.2 5.6 4.5
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¼9.706 sig. ¼ 0.375
Attractions and activities (n ¼ 82) % (n ¼ 199) % (n ¼ 281) %
Ease/convenience 47.6 37.2 40.2
Price related 8.5 15.1 13.2
Part of package 4.9 12.6 10.3
No choice 18.3 6.0 9.6
Flexibility/spontaneity 9.8 8.5 8.9
Recommendation/referral 3.7 9.5 7.8
Previous relationship 3.7 3.5 3.6
Other 3.7 7.5 6.4
x
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¼19.887 sig. ¼ 0.006*
Package (n ¼ 54) % (n ¼ 167) % (n ¼ 221) %
Price related 24.1 21.6 22.2
Ease/convenience 25.9 15.6 18.1
Previous relationship 9.3 20.4 17.6
Recommendation/referral 7.4 21.0 17.6
Other 3.7 15.0 12.2
Someone else booked/organized 11.1 6.6 7.7
No choice 18.5 0.0 4.5
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¼45.881 sig. ¼ 0.000*
Note: * Signi?cant at the 0.01 level (Bonferroni correction was used, 0.05/5 ¼ 0.01)
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convenience, price and no choice as the leading factors. Both domestic and outbound
travelers express their channel choice for transport at the destination and accommodation
primarily in terms of ease and convenience and price although quite a wide range of other
factors also come into play such as service/referral and previous relationships.
Discussion and conclusions
The systematic comparison of domestic and outbound travel reveals signi?cant differences
across nearly all the dimensions examined in this paper (Tables I to VIII). The results in
Table II are a notable exception with signi?cant differences occurring only in terms of age
and region but not the other pro?le characteristics. The general comparability of the pro?le
characteristics suggests a convergence of the outbound and domestic segments and
supports the trend noted in the Ministry of Tourism’s (2006) report that domestic travel is
being substituted by travel abroad. Table III shows pronounced differences in terms of the
domestic and outbound trip characteristics. In particular, domestic respondents exhibit a
higher level of independent, repeat travel while outbound travelers take much longer trips. It
would appear that it is the trip characteristics rather than the pro?le attributes that in?uence
patterns of distribution-related behavior.
Tables I and IV-VI demonstrate clearly that the booking and purchasing behavior for
domestic trips differs markedly from that associated with outbound travel. Signi?cant
differences occur between the two types of travel across three or all four trip components in
terms of the extent of booking in advance or at the destination (Table IV), reasons why
advance bookings are not made (Table V), and the channels used (Table VII). The pattern is
less consistent with regards to how and why bookings were made (Tables V and VI) and the
factors affecting channel choice (Table VIII). In Tables V and VI signi?cant differences occur
between domestic and outbound travelers with regard to transport to the destination and
accommodation but not for transport at the destination and attractions and activities. In
Table VIII the differences are signi?cant for transport to the destination, attractions and
activities and purchasing a package but not for transport at the destination or
accommodation.
These ?ndings corroborate and extend the emerging literature relating to issues of the timing
and location of travel decision-making and distribution (DiPietro et al., 2007; Jun et al., 2007;
Pearce, 2008). Considerable variation occurs between domestic and outbound travel in
terms of the extent of booking prior to departure and at the destination, with those traveling
abroad exhibiting much higher reservation levels in both cases (Table IV). A simple lack of
need is the main reason why bookings are not made, this tendency being greater among the
domestic travelers who have higher rates of traveling by private vehicle, staying with friends
and relations and not taking part in any attractions and activities (Table I). Outbound
travelers equally express a lack of need in many cases but also exhibit higher levels of
uncertainty and/or a preference for making decisions once at the destination.
The survey results also illustrate the complexity of distribution and decision-making issues
and support other recent research in this ?eld, for example the greater pre-trip purchase of
transport and accommodation compared with attractions and activities (Pearce and Schott,
2005; DiPietro et al., 2007; Jun et al., 2007). In addition, this study underlines the need to
differentiate between transport to and transport at the destination. Differing modes of
transport use, varying levels of need and uncertainty, and the aptness of different channels
give rise to quite distinct patterns of use and behavior between the domestic and outbound
travelers and in terms of the extent to which bookings are made prior to departure or at the
destination. The patterns of behavior related to attractions and activities are also often quite
distinctive, notably with regard to the nature and extent of booking and channel use.
The more direct focus here on explaining the patterns identi?ed provides additional insights
into why ‘‘in advance/at destination’’ differences occur and what gives rise to inter-channel
and inter-sectoral variations. Moreover, the examination of these with regard to both
domestic and outbound travel also draws attention to the in?uence of trip characteristics on
visitor behavior and decision-making. Quite simply, the nature and extent of travel booking
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and purchase prior to departure or at the destination will depend on where that destination is
and what types of trip are being undertaken, fundamental points that have often been
overlooked in previous studies. Attempts to develop a greater theoretical understanding of
the booking and channel choice aspects of travel decision-making behavior to complement
the work on information search (Gursoy and McCleary, 2003; Bieger and Laesser, 2004)
therefore need to not only incorporate spatial and temporal dimensions and inter-sectoral
variations but also make more explicit the role trip characteristics play in such behavior.
Additional insight into how domestic and international behavior varies may also come from
extending empirical analyses to other settings, for example examining booking behavior in
large domestic markets/destinations such as the USA or analyzing channel choice where
international travel is over relatively short distances to neighboring destinations as is the
case in many parts of Europe.
Tables VI and VIII identify ease and convenience and price as key factors in?uencing how
bookings are made and how channels are selected. Previous relationships and
service/referral are common secondary factors while ?exibility/spontaneity plays an
important role with regards to attractions and activities. In some cases respondents also
report having no choice, indicating that it is corporate policy that determines which channels
are used or the provider only offers a single channel. Some commonalities occur between
the dominant patterns reported here and Black et al.’s (2002) ?nancial services model where
convenience and costs were proposed as two channel choice factors along with perceived
risk and personal contact. While various forms of personal contact are evident, perceived
risk does not come through in the present study. The travel respondents here appear to be
taking a more positive approach, expressing the importance of previous relationships and in
person bookings, relying on referrals or stressing the merit of ?exibility and spontaneity.
Scope exists to extend this empirical work through similar studies in other contexts and
through more speci?c examination of particular constructs now that the key factors are
emerging. Of particular interest is closer examination and tighter speci?cation of what ease
and convenience means to particular travelers given that respondents here and in Pearce
and Schott’s (2005) study report different sorts of channels are easiest for them to use.
Finally, as noted in the introduction, New Zealand providers will continue to face growing
competition from overseas destinations. Differences in distribution practices and behavior
would not appear to be a major factor in choosing between holidays at home and abroad but
domestic providers must continue to ensure they develop effective distribution strategies if
they are to meet this competition. At present, many New Zealand providers rely heavily on
direct distribution and ‘‘at destination’’ strategies (Pearce et al., 2004; Pearce and Tan, 2006;
Schott, 2007). While the former is largely consistent with the visitor behavior reported here
dependence on the latter is less so. Particular attention must be given to the ease and
convenience with which different channels can be used. The results presented suggest
multi-channel distribution strategies will continue to be needed to meet consumer
preferences. Travel agents in New Zealand should also take some heart from these results.
While direct sales are now an important component of travel abroad, many outbound
travelers still rely on their services and as the overall number of outbound travelers continues
to expand these trends should counterbalance the inroads made by other forms of
distribution.
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