What factors in the environment affect the product?

Case Study: The impacts of the financial crisis on the tourism industry in Greece.

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Dalarna University
ETM

Since 2009 an economic crisis affects the world and some countries are more hit than others. At the beginning of 2010 Greece reached the point of no return accumulating a debt of three hundred billion Euros. This critical situation has impacts on the tourism industry. In Greece tourism is a key economic sector representing eighteen per cent of the GDP. Therefore Greece as a product destination is suffering huge consequences with a cut in the number of tourist arrivals by fifty per cent. We will see how the economical, political, social and technological environment has affected the tourism industry in Greece.

The economic situation in Greece is very bad: debt levels and deficits exceed the limitations set by the European Union. Therefore, the Greek government has to implement austerity measures which consist in higher taxes for alcohol, tobacco and fuel, freezing wages for people working in the public sector and an increase in the full retirement age from sixty one to sixty three years old. These austerity measures arose waves of anger among the population. In order to show their dissatisfaction, nationwide strikes almost paralysed the country. Planes were grounded, boats docked, roads were blocked…
These social events had huge consequences on the Greek tourism industry. Indeed many tourists had suffered this chaos since they were not able to leave Greece by any means (planes, boats, cars…). The tourism industry has been severely hit by the crisis with loads of cancellation and an important decrease in the number of reservations. Indeed, people were well aware of the situation in Greece due to the apogee of the internet and international interest for the events. Then, tourists feared they would be stuck there or they would not be able to visit famous sites because