Strategy Formulation: Crafting Success in Tourism

In a world where travelers can choose between Bali, Bhutan, or the backwaters of Kerala with a single tap, destinations must do more than simply exist on a map. They must compete, evolve, and continually reinvent themselves. This is where strategy formulation steps in. It is the disciplined process of deciding where a destination wants to go, who it wants to attract, and how it will deliver value while protecting its resources. For tourism planners, strategy formulation is less about predicting the future and more about preparing for it intelligently.

What strategy formulation really means in tourism 🔗

Strategy formulation in tourism is the process of designing long-term plans that translate a destination’s vision into measurable goals and concrete actions. It involves studying internal capabilities, scanning external trends, identifying target markets, and committing to a direction that the destination can credibly deliver. Unlike a marketing campaign or a one-off festival, strategy formulation sets the foundation on which every operational decision rests, from where roads are built to which airline routes are subsidised.

The tourism scholar Salah E.A. Wahab, whose work has long shaped destination planning theory, argued that strategy must be set at the national or regional level so that growth is balanced with the welfare of the local population. His co-edited work with John Pigram on tourism development and sustainability stresses that destinations can keep expanding only if short-term returns are weighed against long-term viability. In simpler terms, a destination cannot strategise its way to permanent success by chasing arrivals alone. It must protect what makes it worth visiting in the first place.

Why destinations cannot afford to skip this step 🔗

Tourism is one of the most volatile industries in the world. A single political event, currency swing, pandemic, or viral video can redirect millions of travelers overnight. The strategy formulation and implementation literature in hospitality and tourism has repeatedly shown that organisations need both deliberate planning and the ability to improvise emergent strategies when uncertainty strikes. Without a formulated strategy, destinations react. With one, they respond.

Strategy formulation also helps planners answer three uncomfortable questions that destinations often avoid. What kind of tourism do we actually want? Who pays the price when growth happens too quickly? And what happens when the next crisis arrives? Tackling these questions early creates a buffer against shocks and prevents the kind of overdevelopment that has hollowed out many once-charming towns.

The core steps in formulating a tourism strategy 🔗

While different scholars present slightly different frameworks, most strategy formulation processes in tourism move through a familiar sequence. Each step builds on the previous one, and skipping any of them tends to weaken the final plan.

Step 1: Environmental scanning 🔗

The starting point is a careful look at both the external and internal environment. External scanning typically uses a PESTEL approach, examining political, economic, social, technological, environmental, and legal forces that affect tourism. Internal scanning relies on a SWOT analysis to identify strengths, weaknesses, opportunities, and threats. According to research published in the Encyclopedia of Tourism, SWOT can be applied at national, regional, or local levels, making it one of the most flexible diagnostic tools in destination planning.

For a state like Rajasthan, this might reveal strong heritage assets and a globally recognised brand on one side, and water scarcity, summer heat, and uneven last-mile connectivity on the other. The honesty of this audit determines the quality of every decision that follows.

Step 2: Defining vision, mission, and goals 🔗

Once the diagnostic is done, planners articulate where the destination is heading. The vision describes the desired future, the mission describes the present role, and the goals translate both into measurable targets. Goals in tourism strategy formulation usually cluster around three priorities: growing arrivals and revenue, improving the visitor experience, and ensuring environmental and cultural sustainability.

Step 3: Identifying target markets 🔗

No destination can be everything to everyone, and trying to do so usually ends in mediocrity. Target market identification narrows focus to traveler segments whose preferences align with what the destination genuinely offers. A high-altitude Himalayan circuit is built for adventure seekers and spiritual travelers, not for casino tourists. A coastal city might pursue cruise passengers, MICE delegates, and weekend leisure visitors.

Segmentation also helps allocate marketing rupees more efficiently. Rather than running broad campaigns that reach everyone and convince no one, destinations can craft messages tailored to specific motivations, age groups, and source markets.

Step 4: Leveraging unique competencies 🔗

Every successful strategy is built on what the destination does better than its competitors. These unique competencies might be natural, like the Sundarbans or the Western Ghats. They might be cultural, like the temple architecture of Tamil Nadu or the festivals of the Northeast. They might also be experiential, like Kerala’s Ayurveda traditions or Goa’s nightlife. Strategy formulation forces planners to name these competencies clearly and build offerings around them rather than imitating what other destinations do.

Step 5: Designing strategies and action plans 🔗

This is where abstract goals become operational. Action plans specify activities, owners, timelines, and budgets. Common strategic actions in tourism include launching digital campaigns aimed at specific source markets, investing in eco-friendly infrastructure, training local communities to deliver homestay or guiding services, diversifying products to reduce seasonality, and improving last-mile connectivity. The UN Tourism approach to master plans recommends a five to ten year horizon, with priority actions for the first three years to ensure momentum.

Step 6: Resource allocation and implementation framework 🔗

A strategy without resources is wishful thinking. Planners must allocate financial capital, human capital, and technology in line with strategic priorities. They also need to build governance structures that clarify who reports to whom, how decisions get made, and how progress is reviewed. Strong institutional frameworks are often the difference between strategies that get executed and strategies that gather dust.

Balancing growth with sustainability 🔗

One of the hardest tensions in tourism strategy formulation is the pull between growth and sustainability. More tourists usually mean more revenue, more jobs, and more political support for the sector. But uncontrolled growth strains water systems, congests historic centres, prices out residents, and erodes the very experiences travelers came for.

Wahab’s writing repeatedly returns to this tension, arguing that policies must protect the environment, involve local communities meaningfully, and preserve cultural heritage. Modern frameworks echo this position. Bhutan’s high-value, low-impact tourism policy and New Zealand’s Tiaki Promise are widely cited examples of strategies that put long-term resilience ahead of short-term volume.

For planners in India, this means weighing whether to pursue mass tourism in already-stressed circuits or to develop secondary destinations that can absorb visitors without breaking. It also means asking whether tourism revenue actually reaches local communities or simply leaks out to operators based elsewhere.

The role of information systems 🔗

Strategy formulation today is impossible without good data. Information systems help tourism planners track market trends, monitor visitor behaviour, measure environmental impact, and evaluate whether strategic actions are producing results. Real-time dashboards on hotel occupancy, footfall at monuments, and search interest from source markets allow strategies to be adjusted before small problems become large ones.

Geographic Information Systems are particularly useful for destination-level planning, as they layer environmental, infrastructural, and visitor data onto the same map. This kind of integrated view helps planners decide where to expand, where to restrict development, and where to invest in carrying capacity upgrades.

Strategy formulation at national and regional levels 🔗

While individual hotels and tour operators formulate strategies for their own businesses, the most consequential strategy work happens at national and regional levels. National Tourism Organisations set the broad direction, allocate promotional budgets across source markets, and negotiate aviation and visa policies that shape arrival patterns. Research on strategic planning in national tourism organisations suggests that the comprehensiveness of the process depends on both internal planning capability and the external environment in which the organisation operates.

In India, the Ministry of Tourism’s missions and schemes, along with state-level tourism boards, illustrate how layered this work can become. National strategies set frameworks like incredible heritage circuits or wellness positioning, while state strategies operationalise these through specific products, packages, and partnerships. When the layers align, destinations gain real momentum. When they conflict, even well-funded plans struggle to move the needle.

A practical illustration: Kerala 🔗

Kerala offers a useful example of how thoughtful strategy formulation produces lasting results. The state identified eco-tourism, cultural heritage, Ayurveda, and backwater experiences as core competencies, then built marketing, infrastructure, and community programs around these pillars. By targeting wellness travelers and culturally curious visitors rather than chasing every segment, Kerala carved out a distinctive position in a crowded market and earned a reputation that few Indian states can match.

The strategy also embedded local participation through homestay networks and responsible tourism initiatives, which spread economic benefits beyond a handful of large operators. This is exactly the kind of balance Wahab argued for: growth that serves residents alongside visitors.

Common pitfalls in tourism strategy formulation 🔗

Even with good frameworks, strategy formulation can go wrong. The most frequent mistakes include copying strategies from other destinations without adapting them, setting goals that are politically attractive but operationally unrealistic, ignoring local communities until conflict erupts, underestimating the time required to build new products, and treating strategy as a one-time document rather than a living process. Avoiding these pitfalls requires humility, honest data, and a willingness to revise plans when evidence demands it.

What do you think? If you were advising a tourism board for an emerging destination in your region, which would you prioritise first: a marketing push to attract more visitors, or quiet investment in carrying capacity and community readiness? And how would you decide when a destination has grown enough?

References

1. https://www.researchgate.net/publication/377469560_Tourism_Development_and_Growth_The_Challenge_of_Sustainability_edited_by_S_Wahab_and_J_J_Pigram_Routledge_London_and_New_York_1997_302pp
2. https://pmc.ncbi.nlm.nih.gov/articles/PMC7205733/
3. https://link.springer.com/rwe/10.1007/978-3-319-01669-6_840-1
4. https://www.unwto.org/technical-cooperation/strategic-planning-promotion
5. https://journals.sagepub.com/doi/10.1177/004728759803700103