Introduction
In the east of the Arabian Peninsula, where the desert meets the Indian Ocean, is the Sultanate of Oman. Its history spans over two millennia. The landscapes of Oman are varied. The spectacular landscape makes Oman different from other Gulf countries. Mystical mountains, amazing caves hiding, sands of the great desert, snow-white beaches against the backdrop of ocean expanses, exotic greenery, and much more fill the country’s environment. Every city in Oman is a landmark. The coastal town of Sohar was once the most important port, and today it houses the most significant market. The Batina area is famous for its camel breeding. Apart from this, Batina is the only region where one can see an actual bullfight. The rich and highly developed culture of Oman has given rise to the natural friendliness of its inhabitants, who are proud of their good manners, hospitality, and sincerity. All these factors speak of the country’s excellent tourism potential, which is not used to its full potential, both from international tourism and even more so from domestic tourism. There are many reasons for this fact.
Idea Summary and Analysis
First, the development of domestic tourism faces many legal difficulties. Opportunities to open a business in this area are hampered by government laws and regulations, as well as the need for sufficiently large initial and working capital (Al Badi and Khan, 2020). Accordingly, the threat of new players in Porter’s five forces model is minimal, reducing the competitiveness of existing companies and not stimulating them to make fresh decisions (Bruijl and Gerard, 2018). At the same time, the obstacles are not created by the market but precisely at the state level, making it doubly challenging to stimulate domestic tourism. Secondly, the vector of development of the tourism business in countries where oil revenues are the predominant indicator of GDP stimulates foreign investment (Nayar, 2020). In Oman, despite significant earnings from the export of petroleum products relative to other countries in the region, the share of external inflows is still tiny (Nayar, 2020). This fact is explained by the fact that the non-oil industries have not yet reached the desired development, as, for example, in the UAE, where this sector was stimulated by the holding of the EXPO 2020 exhibition (Olson, 2022). Consequently, this potential of the economy has not yet been fully realized.
Creating a centralized social network focusing on tourism provides several advantages at the global level. First, developments in the field of information technology, which is unique to the country, will provide an opportunity to revitalize this area, which is critical in developing non-oil industries (Al-Sarihi, 2020). Secondly, mutual communication between the regions of the country will open up opportunities for domestic tourism, immersion in the culture of the inhabitants, and stimulation of the preservation of monetary resources within the economy. Finally, partnerships with restaurants, hotels, tours, and other businesses on a sponsorship basis provide a start-up income base, as well as mutually beneficial stimulation to attract the public to the application and the corresponding institution. In addition, this business idea is socially responsible, acquainting the country’s population with the internal culture and geography and attracting the budget to the underdeveloped regions of Oman (Matriano, 2022). At the same time, one should consider the complexity and high cost of developing and designing the initial stage of launching an application. The complexity of laws that impede the development of companies in this area bypasses this idea while creating a platform to stimulate the emergence of new market players.
Production and Marketing Feasibility
In the narrow sense, competition directly in the niche of information technology is currently free. A little more than a thousand downloads from the offline guide to Oman attractions (Google Play, 2022). However, this application does not provide the possibility of online communication of interests, discussions of specific places, and even a system of ratings and ratings concerning locations. Other most-used applications by tourists include specific queries common to all travelers: maps, taxis, and global hotel and restaurant aggregators (Ramos-Soler, Martínez-Sala, and Campillo-Alhama, 2019). In a global sense, competition with such aggregators, especially in the context of international tourism, is almost impossible. This product should emphasize local flavor, domestic tourism, and live communication. Unlike an offline guide, reviews of real tourists should prevail, who, with the help of such a system and blogging structure, will be able to tell vividly and in detail about the country’s regions. At the same time, residents of the region will leave comments on these reviews, which will provoke discussions and, accordingly, interest in specific locations.
There are several reasons in favor of creating an application. Firstly, companies that want to develop in the field of domestic business now do not risk opening because of the significant threats from both government agencies and current competition. A live social network will make it possible to become a comprehensive platform for launching marketing campaigns and, accordingly, gaining access to broad coverage of the population. In-app advertising services will cost much less than local and national advertising agencies, creating a competitive advantage in this area. Secondly, the search for investors in information technology startups is promising; since then, the idea can be franchised to other countries with similar problems of domestic tourism. In addition, developing a unique and high-quality application can attract the attention of government agencies for the development and budgeting of this area and, in the future, the revision of the severity of laws regarding new travel companies.
According to the Oman Vision 2040 program, one of the leading development stakes is placed on the information technology sector. Among other things, the main directions chosen are the creation of smart cities and a competitive economy (Times of Oman, 2021). The application stimulates demand for products in the domestic market and can also serve as an educational function regarding new developments in smart cities. The creation of more market conditions in the regulation of domestic tourism will increase GDP and the number of jobs, as well as draw attention to cities and their problems and bring educational activities into the context of culture. Knowing their own country better, citizens will become more mobile, which can affect both the level of education and overall employment rates. This startup implements two directions of the future development of the country’s economy at once: information technology, represented by application developers, and domestic tourism, represented by interested sponsors. However, at the initial stage, the project will require investments and high costs for design, development, and marketing, which should be carried out mainly through other popular social networks since the target audience should have access to such devices.
Financial Planning Techniques
Financial planning controls the movement of a startup’s income and expenses in the context of both the lines of business of the enterprise and by type of activity. The goal is to ensure the current activities and development of the enterprise within the horizon of the planned period. First of all, it is necessary to define the tasks of the application, which should lead to the success of this idea. Firstly, the application must be developed with all the necessary functionality: a feedback system, a blog, comments, and private messages; a database of the country’s main attractions and recreation areas, including restaurants and hotels; integrate work with maps. Secondly, thanks to the marketing campaign, the application should gain an audience from all over Oman. Thirdly, after active filling with live content starts, attracting sponsorship money for a startup is a plus. Further steps depend on the scale of success, which will determine financial performance.
The next step involves creating the company’s income statement and balance sheet. Dividing the first steps of the startup life cycle into specific stages, one can get the following picture: the search for investments or grants, design, development, advertising, and the search for sponsors. The first step is to cover the costs of the following three, while the fifth depends on the company’s further revenue as the only possible channel and investments. Therefore, when calculating the cost of services from the second to the fourth steps, it is necessary to include this amount in operating expenses after the first step to estimate the potential revenue after the fifth by predicting the reach and cost of advertising in applications with similar statistics. The company’s assets on the balance sheet will include human resources, initial capital, and additional sponsorship income. Debts to investors will go into long-term liabilities. Turning to bank lending services is too risky and unlikely. Specific calculations should be made at the fifth step, where a decision on the project’s viability regarding the number of audiences recruited, funds contributed, and expected outputs.
To do this, the liquidity, debt service, profitability, and asset turnover ratios will be constantly monitored. Debt fulfillment is essential to the company’s reputation and further attractiveness to investors. Debt service, in this regard, is a regulator of potential income: it is possible to plan the number of earnings and expenses for business development in the area of priority tasks. After the assessments are received, it is necessary to move on to drawing the line: calculating net profit, accounting for taxes, and creating a cash flow report. The last item will allow tracking of the movement of expenses that may not be taken into account at earlier stages, including such things as application support, server price increases, and much more. Thus, the key financial ratios are indicators of development at each stage. After determining the costs and necessary investments, the entrepreneur needs to immediately determine the break-even payback line of the application in various scenarios for investors. Based on the data obtained, a conclusion is already being made about the project’s feasibility, the need to search for state support grants, and the transition to further financial planning instruments.
Marketing Plan
The current position of the startup is in the field of the conceptual design of the application, followed by writing technical specifications, forecasting financial performance, attracting investors, and finding developers. At the moment, there is only one in the competitive environment to provide an offline guide to tourism in Oman, which is not updated very often, is not dynamic, and, accordingly, does not pose a threat to development in the field of live communication (Google Play, 2022). Environmental factors are quite variable and should be comprehensively taken into account, while they will be considered differentially. Political obstacles in the field of domestic tourism concern only non-IT companies: various aggregators, service providers, restaurants, and hotels (Al Shekaili, Al-Sulaimi, and Al-Alawi, 2021). On the contrary, ICT developments are encouraged at the level of government programs Oman Vision 2040: even according to the forecasts of global agencies, the industry market will almost double (Times of Oman, 2021). According to external political factors, the current situation is more favorable for a startup than not.
The social trends of the growing popularity of social networks and globalization will allow the target audience, on the one hand, to pay attention to the local culture, on the other hand, to popularize it thanks to a deeper immersion in live information. The pandemic has fueled virtual immersion, and many people from different cultures have become interested in expanding their perspectives, which, if properly marketed, will attract tourists from other countries, improving the country’s economic situation (King-O’Riain, 2022). In addition to the trend of globalization, the pandemic was associated with multiple lockdowns, including the closure of state borders. This factor has contributed to domestic tourism and the appeal to the local culture of travelers due to the inability to leave the country, a trend that has continued even after the main consequences of the spread of the virus (Jeon and Yang, 2021). Consequently, the social environment is changing in a favorable direction for entering this application’s market.
Technological factors in today’s world require constant updates and surveillance of developments to remain competitive. However, since the product at the initial stage will be directed to the local market, and in the absence of severe competition in this market, it is possible to implement it according to the principle of the best value for money in development. First of all, the application should be convenient and intuitive. It can be based on Tiki, Locket Widget, and Whatsapp, which are the most popular means of communication in Oman (Similar Web, 2022). Legally, it will require much paperwork to set up a new company, patent a product, and reserve intellectual property rights. Economically, at the moment, despite the global crisis due to the geopolitical situation in the east of Europe, there is also a favorable environment for entering the market. It is due to the fact that oil, the primary source of GDP and government revenue, is becoming more expensive, which contributes to the inflow of money into the budget, which is distributed, among other things, to the information technology and tourism sectors (Oxford Analytica, 2022). Consequently, citizens’ standard of living is growing, and who will be able to afford more often trips to other regions of the country and gadgets for personal use, where the application will be distributed.
As a result, the strengths of creating this application are a favorable environment of external factors, lack of competition in the market, deployment in a promising industry for the country, and an increasing standard of living for citizens. Weaknesses require serious funding from investors or the state and difficulties developing domestic tourism and companies in this market. Opportunities are opening up in cooperation with tourism organizations, the possible sale of a franchise to other countries, and the opening of a studio for the developers of the most critical social applications in Oman. The threats of new players are practically excluded, while the lack of audience interest due to analogs of general-purpose social networks, the shift in focus to international tourism with the opening of borders, and a long payback period can become obstacles to finding investors and receiving government subsidies.
Market segmentation will take place as follows. The most targeted audiences are men and women in their 30s with access to smartphones and the financial means to travel. Visiting certain places and writing reviews and blogs will help engage the user in the app, while others will receive free, valuable, lively content and stimulating discussions. Locals can talk about their region to potential tourists, who can learn about exciting features from the lips of people who have lived here long enough. Tourism will become more open, exciting, and inspiring for the citizens of Oman.
Accordingly, the marketing campaign of the promotion will be deployed in tourist groups on social networks, photography societies, urban entertainment, and channels that talk about events. After first filling the social network with content, the most active bloggers can be attracted to create more image advertising with exciting travel videos and photos to provoke a desire for domestic tourism, to show that it can also be interesting and beautiful. The diversification of user communities will allow for open discussions on the most critical issues of any trip. In the future, this application can combine the functionality of hotel and restaurant aggregators, the ability to arrange accommodation, as in Airbnb, and communicate and share media files, as in most of the well-known messengers listed above. Thus, a unique and indispensable application for the tourist will be released, filled with like-minded people who will exchange experiences and culture.
Plan Monitoring Mechanism
Monitoring the business plan implementation will take place on two levels. The first is financial and involves constantly updating the forecast calculation and critical ratios for evaluating performance and the possibility of continuing business, as described in the Financial Planning Techniques chapter. The second approach is more targeted and is qualitative rather than quantitative. It aims to identify development problems, create strategies to deal with them, and implement these strategies that adjust operational processes. For example, the development has stalled due to the lack of necessary specialists. Ways to address the problem include offering more competitive wages, diversifying aggregators and human resource sourcing methods, and scouting the international market. Each solution requires a shift in the focus of the adopted strategy and the implementation of new approaches. Monitoring will ensure not only the testing of these strategies but also their preservation while proving their effectiveness. For example, a specialist was found on the international market and turned out to be more profitable for the company due to the difference in living standards in countries; therefore, a more qualified and cheaper workforce can become a startup’s strength if it continues to look for talents in this way.
Conclusion
This paper provides a business plan for creating a tourism application in Oman to stimulate domestic tourism and information technology. As a result of the market analysis, it was revealed that at the moment, external factors are developing favorably, and the main task in the first stage is the correct financial assessment of the project and the search for investors. With an integrated approach, success is possible due to promotional activities concerning sponsors, obtaining grants from the state, and creating an international franchise or an indispensable tool for tourists. Modern trends in the field of economics, sociology, and politics will only contribute to the development of this startup.
Reference List
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