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Keywords Internet, Distribution, Value chain, South Africa, Tourism
Abstract The Internet is an important new channel for commerce in a wide range of industries. While the opportunities afforded by this phenomenon seem readily apparent, there is still much debate and speculation on exactly how the use of the Internet and in particular the World Wide Web will affect established industries. In this article we analyse the value chain of the tourism industry, using as a case study the tourism industry in South Africa. Specifically, we examine the roles played by intermediaries in the distribution chain and explore the threats and opportunities that the emergence of the Internet, and other associated trends, present for the industry. Based on this, a profile is made for successful new intermediaries and, finally, we assess the implications of this profile on the control of the electronic channel.
Introduction
The Internet is fast becoming an important new channel for commerce in a wide range of industries. While the opportunities presented by this channel seem readily apparent (e.g. bypassing others in the value chain), there is still much debate and speculation on exactly how the use of the Internet and in particular the World Wide Web (WWW) will affect established industries. In most contemporary markets, the disparities inherent in mass production and mass consumption have caused intermediaries to enter into the distribution chain between buyers and sellers. What seems clear is that the Internet as a new medium undermines many of the key assumptions on which traditional distribution philosophies are based and that it has the potential to transform and even obliterate some distribution channels. For example, no longer does a consumer have to wait for a retailer (who does not carry a good inventory of the latest products) to open, drive there, attempt to find a salesperson who is generally ill-informed, and then pay over the odds to purchase a product. Products and prices can be compared on the Web and lots of information can quite easily be gleaned. If one supplier is out of stock or too expensive, there is no need to drive miles to a competitor (competitors abound and all are equidistant - a mere mouseclick away). In so doing the Internet could render many distribution...