1.Introduction.

There are many wonderful places in the world. Various attractions make these places potential tourist destinations. Still, it is very seldom that some destinations become popular among tourists without a lot of planning work behind it. In order to optimise the benefits of tourism for a destination and prevent or at least mitigate any problems that might be generated, good planning and careful management of tourism are essential. (Inskeep 1991:16) To achieve success in destination development we should learn to analyse the situation. We should always think about what stage we are on now, where we want to go and how we can get there.

In this paper I will show the development over time of a small destination in Iceland. Myvatn area is a relatively new tourist destination but it has become successful due to the introduced innovations.

In the first chapter I will review the theory about destination development.

In the next chapters I will talk about the planning and development work which stood back Myvatn as a destination. I will also show the result of this development.

2. Destination development.

2.1 Butler’s concept

Several researchers have noticed that destinations go through definite phases in their development. The idea that destinations experience a process analogous to birth, growth, maturation, and perhaps decline or even death is embodied in the concept of the destination life cycle, suggested by Butler in 1980. Butler sequence is a S-shaped cycle model, which proposes that tourist destinations tend to experience five distinct stages of growth under free market and sustained-demand conditions (Weaver 2002:309):

• Exploration

• Involvement

• Development

• Consolidation

• Stagnation

Figure 1. The Butler sequence. Source: Weaver 2002:309

According to Butler, the exploration stage is characterised by very small numbers of visitors. The tourism “industry” as such is non-existent, no specialised services and facilities are established, not even accommodation for tourists. The tourists themselves are adventurous types who are drawn by what they perceive to be authentic cultural and natural attractions. These visitors arrive from a wide variety of sources, remain for an extended period of time and are not influenced significantly by any consideration of seasonality. (Weaver2002:310)

In the involvement stage the visitor numbers begin to increase slowly. The local entrepreneurs begin to provide services and facilities for tourists. They usually consist of small accommodation places, eating places, few small semi-commercial attractions and some simple guiding service. Still, at this stage the destination maintains local control over the situation. The economic status of tourism is insignificant for the destination. The impacts on the society and the environment are little. The area is just beginning to integrate into the tourism system. The factors that trigger a destination into the involvement stage can be either external or internal. Internal forces are the ideas and enthusiasm of the local entrepreneurs who realising the profit that tourists can bring start building and advertising facilities and services. External forces can be travel publications, recommendations of the tourists, who have been to the place, or just the promotion by tour agencies that for some reason begin to work with this new destination.

The development stage is characterised by rapid tourism growing and dramatic changes in all aspects of the tourism sector in the region over a short period of time. Local community loses control over the situation; larger, non-local companies gain control over the process, attracting tourists from all over the world. Large-scale accommodation places are built, attractions oriented for tourists appear. The destination is losing its authenticity and uniqueness.

The consolidation stage is characterised by a decline in the growth of the visitor arrivals and other tourism-related activity. The level of the tourism development begins to exceed the environmental, social and economic carrying capacities of the destination. The non-authentic attractions dominate, the tourism product is deteriorating. Tourists are losing interests for the destination.

Stagnation is characterised by further product deterioration. This stage can theoretically persist for an indefinite period, but it is more likely that the destination will experience either decline or rejuvenation. Decline happens when tourists are no longer satisfied with the product and the destination stakeholders do not make attempts to attract new groups of tourists or revitalise the product, or do not succeed in this. Besides, new competitors appear in the market. Scenarios of rejuvenation can be different. The most important is to change the product or to find other market segments for the existing product. In this paper I will not discuss the relevance and applicability of this model but I will use it to show the development over time of the destination Myvatn.

2.2 Planning process

Independent which stage the destination has reached, we need to plan thoroughly every next step. Tourism planning is necessary for the following reasons:

• Tourism has both positive and negative impacts on the economy, society and the environment.

• Tourism involves many other industries and planning is necessary to insure that every industry gets profit of its development.

• Tourism is still a new type of activity and many entrepreneurs have no experience in how to develop a destination.

In fact, according to Haywood, the evolution of tourist destinations can perhaps be anticipated and through planning, marketing and management techniques not necessarily decline. (Inskeep 1991:17)

The strategic planning is a complex process, which explains the steps a company should undertake to gain the desirable position. Here is a model illustrating it:

The strategic planning process

T he Mission Aims of the organisation What is it we want?

External analysis Where

Gathering information are

Internal analysis we now?

Strategic analysis and choice Decisions Where do we want to go?

Short term operating strategies How do we get there?

Implementing of strategies Action

Control and evaluation Did we get there?

Figure 2. Source: Lecture notes from Nordplus course in tourism planning, 2003, Iceland.

First of all we should formulate the aims of the organisation in a mission model. Then we should analyse the situation in the market and the product itself, or the resources we have if we don’t have any product yet. The following techniques are usually used to understand the present situation( lecture notes from NordPlus course in tourism planning):

• PEST analysis - political, economical, socio-cultural and technological uncontrollable factors in the macro environment.

• The analysis of the trends in the market

• The analysis of our competitors

• The product analysis with respect to the markets and the competition

• Consumer analysis- characteristics and behaviour of the customers and consumers.

• SWOT analysis (strength, weakness, opportunities and threats) –sums up and present the information collected and processed in the analytical process.

I will use these planning process models to show how the Sel Myvatn Hotel worked with the development of the destination Myvatn.

3. Development of the destination Myvatn

3.1 Presentation of the area

In my paper I want to study the development of the destination lake Myvatn in the Northern Iceland. We distinguish between point destinations, place destinations and region destinations(Sletvold 2000:267). Myvatn is rather a region because there is a lot of unique about the lake as well as in the surroundings. Lake Myvatn is the country’s fourth largest natural lake, 36.6 km² (www.goiceland.org). It is renowned for wildlife. This area is extremely volcanic, which explains the mountain formations around the lake. Nine eruptions took place there during the period 1975-1984; at that period there were a power station on the volcano. The lake area is known for its exceptionally many breeding duck species (15); it is thought to nest more species of duck than any other place in the world (www.nat.is/travelguideeng/myvatn). The lake’s surroundings show such variety in landscapes and amazing geological formations, that the visitors have to spend several days to enjoy them fully. Bubbling mud flats, lunaresque volcanic craters, newborn lava fields, and grassy shoals teeming with waterfowl; these are among the sights of Myvatn. Dimmuborgir, on the East side of the lake, is a badlands of lava pillars, some of which reach 65 feet in height. Just north is Hverfjall, a smooth, stadium-shaped volcanic cone that formed during eruptions 2,500 years ago. One of the most bizarre attractions in the region is the mud pits of Haverarond, which are so hot that they actually boil. Far cooler are the waters of Viti, an explosion crater nearby, which was formed in the 1724-1729. Another unforgettable sight near Myvatn is Eldhraun (“fire lava”), an absolutely barren lava field where the Apollo 11 crew came in the late 60’s to train for their impending moonwalks. There are also numerous bathing possibilities in Myvatnsveit. The most interesting ones are the Lagoon, which is similar to the Blue Lagoon near Reykjavik, and for rinsing off the clay afterwards there is a natural steambath in Jarðbaðshólar (www.nat.is/travelguideeng/myvatn). It is an old site where hot steam rushes out from the core of the earth and has been used for bathing for ages.

Myvatn has about 470 inhabitants, of which approximately 200 live in the village Reykjahlið. Before people used to live on the proceeds of the land farming and fishing for trout in the lake but it has changed radically in the last few decades. A diatomite factory was established in the late sixties and soon became the biggest source of employment in Myvatnssveit. The geothermal power plant at Krafla also provides for quite a few positions for the locals and tourism is a steadily growing business.

3.2 Development of the destination

In 1974 the lake was declared a national conservation area, and since then Icelandic tourists has begun to go there. The period of the exploration started then. The lake is very unique and there are lots of tourism resources. Still, at the beginning the region was not known. The few visitors, drawn to Myvatn by its natural attractions, were mostly geologists, biologists and other scientists. A number of Icelanders also came to the region to enjoy the nature. But the area was not adjusted for tourism. Accommodation could be only found in the nearest towns. Tourists had to arrange the trips on their own (from the interview with Sel Myvatn Hotel manager).