DEVELOPMENT STAGE

In the development stage, it shows that high numbers of tourists that may exceed the local population during peak periods. It also can control passes from the local to external organization. Then, it increase in tension between local people and tourist. In this stage, also company start to see the emerging potential of the area as a tourist arrive and therefore start to invest money in the region.  They build large hotel complexes and sell package holidays. A package might include travel, accommodation, food and excursions.  This makes the numbers of tourists swell dramatically and massively expands the number of job opportunities for people in the local region, in both tourist related jobs and in construction and services.

Furthermore, the goal at this stage is to maintain existing demand, reach new customers from competitors and create new products. At this stage, three strategies are seen as the most appropriate due to its use in several destination literature.

First strategy is overall cost leadership strategy. A sustainable cost advantage can be developed by Kuala Lumpur, over their competitors, through cost leadership. Cost leadership strategy is where the destination achieves lower costs than its rivals and competes across a broad range of segments. This strategy aims is to secure a cost advantage over its competitors destinations, price the product competitively, relative to how it is perceived by customers and achieve a high profit margin (Thompson, 1997). If this applies, destinations will earn strong profits while attracting consumers at lower prices. As the result, the tourists’ perceived value of the product becomes the competitive advantage (Andriotis, 2001).

Second strategy is differentiation strategy. Differentiation strategy is centred upon increasing the value for which the tourist is willing to pay premium prices. Thus it is crucial for the Kuala Lumpur to ensure the cost to add value is invested in areas that the tourists perceive as important as well, it is essential to the tourist to recognise and appreciate the product uniqueness and differences (Thompson, 1997).

Third strategy is focus strategy. Compared to the overall cost leadership and differentiation strategies that appeal to the broad market, focus strategy is where the destination may choose to confine their products/services to particular market segment, thus concentrating only on one segment or a limited range of segments. The destination of “get to know the needs of these segments and pursues either cost leadership or a form of differentiation within the target segment” is important. Consequently the focus strategy serves this market better than competitor destination.