PESTEL ANALYSIS OF THE ADVENTURE GAMING COMPANIES

PESTEL ANALYSIS OF THE ADVENTURE GAMING COMPANIES
  1. Political effect on the industry-

Political violence has done considerable damage to tourism in Asia and the Pacific over the past few years. But industry experts say the damage is not necessarily permanent. Governments and industry leaders say much can be done to rebuild tattered tourism reputations.

But with the right government and industry responses, visitors will return.

Industry analysts say tourism in Asia is likely to expand rapidly over the next few years. But, the key, they say, is that governments find ways to prevent political violence, and act quickly to calm fears when it does happen. Political unrest creates dilemma in the minds of the tourists. It has been seen in the past that violence due to political unrest had ruined the local tourism and adventure sports market.

On the taxation issues, the refunding of VAT as done in countries like Thailand and Singapore can also help the tourism sector.

  1. Economic effect on the industry-

Tourism, which has expanded dramatically over the past 30 years, looks set to continue growing as societies become more mobile and prosperous.

Weakening of Rupee against dollar is a perfect opportunity for Indian tourism sector to become a hotspot in Adventure sports.

Local market is largely dependent on the disposable income of the residents. Market is subdivided into budget conscious, high disposable income and mid-range buyers.

  1. Technological effect on the industry

One of the latest applications is software that permits tourists to customize their visits according to their preferences.Users must have access to the internet, either through a computer, a mobile phone or a PDA, in order to be able to access a web where they can define their preferences and needs.Use of GPS and other navigation utility has made tourism safer. Recent development of safety gear for Adventure sports has created a boom in the market as more people are now interested into adventure sports for recreation and tourism needs.

  1. Environmental effect on industry-

The quality of the environment, both natural and man-made, is essential to tourism. However, tourism’s relationship with the environment is complex. It involves many activities that can have adverse environmental effects. Many of these impacts are linked with the construction of general infrastructure such as roads and airports, and of tourism facilities, including resorts, hotels, restaurants, shops, golf courses and marinas. The negative impacts of tourism development can gradually destroy the environmental resources on which it depends.

On the other hand, tourism has the potential to create beneficial effects on the environment by contributing to environmental protection and conservation. It is a way to raise awareness of environmental values and it can serve as a tool to finance protection of natural areas and increase their economic importance.

  • Three main impact areas: natural resources, pollution, and physical impacts
  • Environmental impacts at the global level
  • How tourism can contribute to environmental conservation
  1. Social effect on industry-

Tourism product is dependent on associated ecosystems in an area. These ecosystems are, however, threatened by natural causes and human behaviour such as pollution and global warming.

All parties involved (the citizens, the tourism industry and the visitors) have a vested interest in the management of the environmental resource base and an obligation to do their part to support this management. If the environment is degraded all parties stand to lose – visitors will fail to come (or will be willing to pay less) and the countries will lose an important source of economic benefit. In other words the environment will produce reduced economic, ecological, and amenity benefits.

The cost of the provision of the good does not take into account negative externalities such as environmental damage, this results in market failure. If this market failure is not corrected it will result in a loss in social welfare (dead-weight loss).

  1. Legal effect on the industry-

Whilst risk is a vital element of the adventure tourism experience, from a legal perspective, the debate is over how much of the risk rests with the operator and how much rests with the willing participant. Tourism operators have begun to use disclaimer clauses to minimize common law damages. Yet these will not absolve operators from conducting their operations in a safe manner. Any Mishap at the site would lead to multiple legal litigation and closure of the firm.

The main objective of the business is to offer a safe and wonderful experience to the customers to earn their loyalty and marketing by word of mouth. Any deviation (legal violation) would also lead to abstaining of participation.

Changes in legal structure of the industry are to be absorbed by the proprietor and lead to lower margin.

Current legal Statement as defined in Guidelines for recognition / renewal or extension as an approved adventure tour operator (ATO) [revised with effect from 2nd January 2012] requires a lot of compliance as well as huge costs and the industry being highly unregulated is susceptible to failure in those parameters

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