Limitations of Niche Markets
The use of tourism for community development in LDCs has, for the most part, focused on
rural areas. It is these less accessible areas that have not benefitted from traditional tourism
markets, such as those in larger urban centres and capital cities. The assets available to rural
destinations are usually limited to being natural or cultural assets. Thus, the niche market
models of ecotourism and cultural tourism are the most appropriate models for
development, as they utilise existing assets, reducing capital outlay, and seek to attract
independent tourists with higher spending and cultural and environmental sensitivity. This
increases income via tourism without dependence on high numbers of tourists and ensures
a minimal impact on the community. These markets also represent tourists willing to travel
to more isolated destinations, who will tolerate lesser infrastructure in exchange for a
‘genuine’ experience (Mason, 2003). Therefore, these niche markets are theoretically an
ideal solution for stimulating economic development with least effort and expenditure, and
minimal impact on the community.
Despite the theoretical potential for the attraction of niche markets to achieve the
development goals of communities in LDCs, there are some important issues that need to
be addressed. Where communities utilise tourism for development, priority is placed on
economic and social development. Even under the sustainable tourism paradigm,
development goals include major changes to the livelihoods of the community and the
improvement of essential infrastructure. These goals are reliant on the sustainability of the
industry, in terms of the continued growth of visitor numbers, to increase the income from
tourism to fund development goals. It can be argued that the scale of development required
in LDC communities for poverty alleviation in dependent on long term growth.
Therefore, conflict arises when communities utilising tourism for development require
continuous long term growth in visitor numbers. As these numbers increase, it will
ultimately alienate their original niche target markets in favour of broader, mass tourism
markets. If communities do not make this transition to more traditional markets, visitor
numbers will plateau, and growth will cease, which will impede the achievement of
development goals. The transition to more traditional mass tourism markets, however, will
increase the prevalence of negative tourism impacts which the original niche market was
designed to minimise.
In these cases, the prioritisation of development goals also negatively affects sustainability.
The expansion of markets beyond the original niche markets will increase negative effects of tourism, thus causing a failure to sustain the tourism industry in terms of causing no harm to
the social, environmental and cultural fabric of the community. However, not expanding the
target markets for tourism will cause a stagnation of the tourism industry, where the
industry itself will not be sustainable, nor provide benefits for future generations, and
preventing the provision of benefits through the achievement of development goals.