1. Introduction Competitiveness is important economic category, which is considered at different spheres and different levels. Competitiveness in the tourism industry has fundamental differences, related to functions, which tourism industry enterprises perform, to place of their activity, to market size with tourism enterprises be- ing oriented at it, to specific service sphere features, where competitive struggle is of particular tension. The necessity of creation of competitive tourism product at home market and world markets is indi- cated in the Concept of development of tourism to 2022 (Розпорядження Кабінету Міністрів …, 2013), and is regarded as one of the factors ensuring inte- grated regional development. Research of competitiveness in the tourism in- dustry is based on a strategic approach and is close- ly associated with notions of competitiveness of the tourism product, tourism enterprises, marketing of destinations, strategies of competition of tourism enterprises and destinations. Strategic approach to tourism development should be directly consistent to the project approach, which allows converting strategic plan into specific projects and programs of territory development. Journal of Geography, Politics and Society 2015, 5(2), 7–18 DOI 10.4467/24512249JG.15.007.5163 ComPetItIveneSS of tourISm ProduCt: evaluatIon and aPProaCheS to ProvISIon Arthur Levytskyy Admission Department, Odessa Regional Institute of Public Administration, National Academy for Public Administration under the President of Ukraine, Genyez’ka 22, 65009 Odessa, Ukraine Citation Levytskyy A., 2015, Competitiveness of tourism product: evaluation and approaches to provision, Journal of Geography, Politics and Society, 5(2), 7–18. abstract The analysis of main components of Ukrainian tourism competitiveness showed the necessity of forming of effective strate- gically-oriented public policy in this sphere. The most effective means of its implementation is to use competitive strategies based on a combination of strategic and project approach. The basis of its formation is quantitative evaluation of competitive- ness in tourism that at the micro level is based on the analysis of two main facilities: tourism product and tourism organization. Marketing approach to destination, which provides the elaboration of complex tourism product, is considered. The activities of management and marketing of destinations are considered as integrity of strategic, project and operational activities. The article proves the necessity of using the project approach, which enables to convert strategic plan into specific goals and pro- grams of territory development. Key words competitiveness, tourism product, tourism organization competitive strategies, tourism enterprises, marketing of destinations, project approach. 8 Arthur Levytskyy 2. the competitiveness of tourism market of ukraine The concept of “competitiveness” reflects potential capabilities of subject to function effectively in com- parison with other market players in a competitive environment. The competitiveness of the tourism market is considered in three aspects: the competi- tiveness of the tourism industry, the competitive- ness of the tourism enterprises and the competitive- ness of tourism product. A positive feature of the definition that is advisa- ble to consider when interpreting the essential char- acteristics of the competitiveness of the tourism in- dustry, is the prospect of its provision with using the competitive advantages in components of the sys- tem of knowledge, abilities and skills – formation of modern competitive strategy based on competence. Yu. Mihuschenko (Мігущенко, 2013) understands the competitiveness in the tourism industry as the ability of enterprises involved in the creation and implementation of tourist services, to resist com- petition in the dynamic changes in the domestic and international markets while effective using the endogenous competitive advantages of its internal environment and exogenous influence in order to maximize customer satisfaction of tourism products (services) and to make profit. Evaluation of static or dynamic competitiveness of tourism industry in order to justify priorities and strategic measures of its strengthening needs the development of multilevel technique , which would generalize most used methodical approaches at different levels in the sequence of several stages – preparatory, analytical and resulting. One of the methods of diagnosis of tourism industry develop- ment at the national level is to study the internal and external environment using SWOT-analysis. SWOT- analysis of the competitiveness of the tourism mar- ket of Ukraine (Фролова, 2015) showed that the fu- ture development of tourism in the country should be based on the following components: investment and innovation in the tourism and hotel industry; reorganization of transportation services; training of qualified personnel; normalization of political, economic and legislative climate; informational communication. Tourism and Travel Competitiveness Index (TTCI), developed by the World Economic Forum (Geneva, Switzerland), assesses the factors and policies that promote the development of tourism sector in one country (The Travel & Tourism …, 2013). The an- nual rating research conducted from 2007 to 2009 and from 2010 studies are conducted every two years. Ukraine is included in the study since 2007. According to the Tourism and Travel Competitive- ness Index in 2013, Ukraine was able to improve the global competitiveness of this sector, rising by 2 years to 9 positions in the ranking of 140 countries. Unfortunately, in 2015 Ukraine missed a rating of at- tractive tourist countries. Ukraine in the ranking in 2013 has been assessed at 3.98 points out of seven possible and took 76th place in the ranking of 140 countries. This is the highest place that Ukraine occupied during the period of calculation of the Index, however, this re- sult says more about the renovation of the lost po- sitions after the crisis (respectively 78th and 77th place in 2007 and 2008). One of the reasons of low competitiveness of the tourism sector in Ukraine is that it is outside the priority agenda of the Govern- ment (126th in the world). The relative size of budget funds allocated for the development of the sector, is not inferior to world leaders (38th), indicating a lack of efficient use of these funds. Despite the resource provision of Ukraine, unfor- tunately, it cannot compete with developed tour- ist states. The only way to solve this problem – is to form a solid, strategically-oriented state policy, whose main task would be really identify tourism as one of the main priorities of the state, to create a strong authority to manage tourism development, to implement proven worldwide economic mecha- nisms of successful conduct of tourism business and encourage investors to invest in tourism infrastruc- ture in Ukraine. Today there is a trend of transformation of the international tourism market – the market of manu- facturers, it turns into a market of consumers. com- petition not only between enterprises of the tourism industry, but also between countries and local desti- nations is exacerbated. 3. the key factors of competitiveness of tourism product At the standpoint of manufacturer tourism product is a combination of a quantity and quality of prod- ucts and services predominantly recreational char- acter prepared in the very time for the implementa- tion for specific customers and fixed in tour program. For consumers, the tourism product (potential demand) – is an abstract product, consisting of ben- efits, the sources of which are in the nature (climate) in the material (buildings, infrastructure, goods of tourist destination) and immaterial (services, social environment) form which is offered on the market and the potential opportunity for its acquisition and consumption exists. Competitiveness of tourism product: evaluation and approaches to provision 9 Combining all of these benefits in one notion is an objective necessity, because the consumer can- not meet their diverse needs in restoring vitality only by one type of tourism goods or services, but only in the complex, and thus in a certain place and a certain atmosphere. Clearly, consumers are inter- ested in the basic conditions of travel, his safety, comfort degree that is realized through the level of completeness and quality of services and goods. The impressions that the consumer gets from expected and seen historical monuments, the beauty of the natural environment, traditions, culture and life of local people, etc. remain the main factor of satisfac- tion (Мігущенко, 2013). Considering the content that is embedded in the product concept that is offered and implemented by tourism enterprises and consumed by tourist we may assert that the proposal of tourism product in terms of developed market relations has dual na- ture, and accordingly, description: economic and marketing. The totality of travel products from an econom- ic point of view is represented in the international document on Statistics “Tourism Satellite Account” (ART), which is developed by the UN on the position of demand (Tourism Satellite Account …, 2001). Typ- ical tourism products ART include services of tem- porary accommodation, drinks and food, passenger transport services, travel agents, tour operators and tourist guide services in the field of culture, recrea- tion and entertainment, and other services (financial and insurance, rental of tourist goods and services). Characteristics of the tourism product from the marketing point of view can have several approach- es. One of them may be based on the classification of the resources represented in the report of the WTO (Сенин, 1999), in which resources are divided into seven specific groups: natural resources; energy wealth; “human factor”, which is considered in terms of demographics data, living conditions, habits and preferences of the population in relation to tourism and in terms of data on various aspects of culture; institutional, political, legal and administrative as- pects; social aspects, particularly the social structure of the country, popular participation in government, the relationship between working time and leisure time, the presence of paid holidays, traditions and level of education, health and recreation; various goods and services, transport and equipment that form infrastructure of recreation and leisure areas; economic and financial activities. Therefore, the competitiveness of the tourism product is caused by a synergistic combination of economic and marketing component, in the pro- portion of price and quality “impression” as integral characteristics that is defined as its advantage over another product that is similar to destination or its substitute while the potential buyer satisfies his needs. However, keep in mind that for assessing the quality of the tourist product there is no real meas- urement values. In this regard there are areas of concern to iden- tify and evaluate the competitiveness of the tourism product: • how to assess the level of quality and customer value of tourism product; • how to define an objective basis for tourism product price; • how to determine the competitive advantages of the tourist product. Considering that the basis for the competitiveness of the tourism product is the quality of its provision to consumer one should stress the lack of a com- plete system of standardization activities in the tour- ism sector. We note that harmonization of standards in tourism is a must according to the signed Agree- ment on association between Ukraine and the Euro- pean Union. To fulfill this task in March 2015 an or- der was issued by the Cabinet of Ministers of Ukraine “On approval of the prepared by the Ministry of In- frastructure Plan on implementing the EU Council Directive of 13 June 1990 90/314 / EEC of organized tourist travels and leisure with a full range of servic- es and comprehensive tour”. According to the plan of implementation in June 2015 it was planned to make a list of defined standards to national stand- ards development plan for 2016–2017, and in De- cember 2017 to adopt act on the introduction of the standards that stipulate requirements for travel services provided within countries (Розпорядження Кабінету Міністрів …, 2015): a) services to provide transport service; b) services of hotels and other tourist accommoda- tion; c) conditions for the organization of tourist services; d) requirements for the camps, recreation centers; e) services of ecotourism; f ) tourist and excursions services and language support; g) security of life and health of tourists; h) informing consumers of tourism services; i) services for consumers with limited physical ca- pabilities; j) other services. Implementation the work in a technical regulation area of tourism will ensure the compliance of com- mitments taken by Ukraine to EU countries, will pro- vide domestic tourist products with European level of quality and will improve the country’s image in the international arena. 10 Arthur Levytskyy For an objective assessment of the competitive- ness of the tourism product one should use criteria, which consumer operates, first of all, one should de- termine the range of parameters to be analysis, and is significant from a consumer perspective. Criteria of competitiveness of tourism product include competitiveness of the product itself and competitiveness of an offer and providing product. 1. The first criterion – competitiveness of products – describe indicators such as assortment, price and quality of the product (Лойко, 2005): 1.1. Assortment – is ordered set of tourism prod- ucts by a certain characteristics that are a set of products, their species and varieties, grouped according to certain criteria. 1.2. The tourist product price characterizes con- sumer spending for the purchase of the tour and depend on the price of transportation and distance to the subject of a tourist des- tination, how many stars the hotel has and location of hotel, sales volume, the currency of payment, the duration and nature of busi- ness relations with clients, the firm’s image and more. 1.3. Product quality is regarded as its ability to meet the specific needs of prospective cus- tomers. The quality of the tourism product involves not only the comfort and conveni- ence of accommodation, food and motor transport service, but also the attractiveness of tourism resources. 2. The second criterion – competitiveness of offers and providing product – characterize the indica- tors of service mode of the tourist site, the aver- age time of service, environment care, qualifica- tion and skills staff (Шахова, 2014): 2.1. The form of service – a way to take order for the tour and its providing to consumers. By individual indicators characterizing the form of services we can include: the availability of direct contact with service, customers’ time savings, saving of firm resources. 2.2. Operating mode of tourism enterprises – is astronomical and calendar time at which ser- vices are offered. Depending on the specific conditions in one case one use optimally dis- tributed one-shift mode, taking into account consumers’ free time, and the in the second case – the extended, two-shift and three shifts working day. 2.3. Time of service – the time from taking to per- forming the order. Since the implementation of services in tourism enterprises (during the execution of documents, making payments on the tour, etc.), hotels (at the time of check- in, guests settlement), restaurant industry in- stitutions, trade (during the calculation) the satisfaction of consumers depends at most on implementation of services. 2.4. Environment service, which includes external design, state of maintenance and environ- ment of tourist enterprise and is character- ized by indicators that assess the exterior (facade design, the availability of signboard, advertising design stands) and interior en- terprises (size, furnishings, maintaining order and cleanliness in reception hall and at per- sonnel workplace). 2.5. Compliance with the requirements to the exterior and staff. Constant communication with customers makes special demands on corporate clothes, physique face, hair, at- tractiveness, personal care, moves and facial expressions, that everything that can be at- tributed to the appearance of employees. No less important are staff and relationships with customers, their professional skills and qualifications, mannerisms, way of servicing operations. Thus the main parameters to assess the quality and customer value of tourism products include indica- tors that determine the technical, functional and ethical quality of certain services and integrated tourism product and indicators of their public-nec- essary costs. Through the use of a differentiated approach to the criteria and parameters of assessing the qual- ity of tourism product grounds for the answers to a number of topical issues, including on achieving the planned level of competitiveness of tourism product as a whole are created; identifying specific parameters that have not been achieved in the pro- cess provision of tourist services; singling out those parameters which have the largest difference on the qualitative sample offered or provided tourism services. This approach to determining the degree of approximation to the qualitative standard rate should be a reference model for the future applica- tion of the relevant criteria for assessing the quality of services or individual product when determining the appropriate price, i.e. be the main element seg- ment of pricing and competitiveness in the market of high-quality tourist services, and further – image component of the tourism product. Competitive advantages of the integrated tour- ism product characteristic “price-quality” must be supported by a system of values that is created as a result of the work of tourism enterprises. Creat- ing a system of values can be considered the de- fining feature of tourist enterprise in terms of its Competitiveness of tourism product: evaluation and approaches to provision 11 competitiveness both on domestic and internation- al tourism market. Thus, the tourism product as the product is char- acterized by the consumer cost that is utility or the ability to meet the very recreational needs of specific people. The usefulness of the tourism product is de- termined by its value to the consumer. Accordingly, the travel company (tour operator) seeks to create a tourism product that would be most valuable to more people. Competitive power of suppliers in the tourism sector is determined by the possibility and the cost in changing the supplier of components of the tour- ist product or services (transport, insurance com- pany, excursion organization, accommodation and catering facilities, etc.). Suppliers are able to show market power above the participants in tourism in- dustry threatening by increasing prices or reducing the quality of the products and services provided. Competitive strength is determined by consumer demand, which they form due to their needs and ex- pectations. Precisely them, in full accordance with certain conditions the travel company must satisfy. If the buyer has information about the supply and demand of tourism products, the actual market prices and alternative products or services, existing competitors, it gives him more opportunities to get a reasonable price compared to others. Considering the competitive forces discussed above, we can establish that the criteria for determin- ing the competitiveness of the tourism enterprises are competitiveness of products (services). In turn, competitiveness of the tourism product depends on two groups of factors: external those are independ- ent of the company, and internal, which depend on the enterprise (Мігущенко, 2013). The external fac- tors may include: the image and reputation of the country; customs policy; state tax policy; the price of goods of services; currency fluctuations; political system. The internal factors: the company’s reputa- tion, experience; circle of business partners (hotels and tour operators, insurance and transportation companies); terms of the contract for travel services; the reliability of the company to provide services that are included in the tourism product on time and in full; the possibility of acquiring a loan tourism product; the level of complexity and individuality of tourism product; channel strategy and sales. 4. Competitive strategies of tourism enterprises The competitiveness of tourism enterprises – a gen- eral characteristic of viability, due to the efficiency of use of available resources, the ability to provide attractive on price and non-price characteristics of tourist services, the ability to adapt to dynamic changes in the competitive environment (Гаврилюк, 2006). The competitiveness of tourism enterprise can be assessed by comparing the most important crite- ria, summarizing the results of the company in terms of establishing a system of values, namely: • indicators of competitiveness of comprehensive tourism product; • share of the enterprise on the tourism market and its dynamics; • stable position on the market; • the size of a functioning capital and return on eq- uity that characterize the financial capabilities of the company and effectiveness of capital using; • qualification of personnel structure and stability of the company; • HR organizational structure. The analysis of competitors and the development of specific actions against main rivals often do more good than real growth in this market segment. Knowing the strengths and weaknesses of competi- tors, we can estimate their potential, objectives, pre- sent and future strategy. This will allow the company to expand its own advantages in the competition (Фатхундинов, 2000). Accordingly, development of the strategy – is also an element of competition. Competitive strategy – is a way to get sustainable competitive advantage in each strategic business area of enterprise by competitive struggle, meet the diverse and changing needs of customers bet- ter than competitors do. In the activities of tourism enterprises different competitive strategies based on certain conditions are used: the presence of com- petitive advantages, the type of competition in the market, the nature of demand for tourist services, the size of the market share, the nature of tourist ser- vices, the level of expenses; price range and quality of products, the costs of innovation. Use of competi- tive strategy relevant to certain conjunctual condi- tions is one of the measures of sustainable business position in changing market conditions. The effectiveness of competitive strategy de- pends on the level of competitiveness of the enter- prise. Considering that the competition strategy is primarily focused on the formation of its own market space, inaccessible to most competitors, the main task of enterprise is to use effectively competitive advantages to create a new (additional) consumer value. To achieve this goal a competitive strategy should be developed for a particular method that the will ensure accountability and controllability of internal competitive factors: information, resource, 12 Arthur Levytskyy financial, technical and technological, marketing, organizational and structural. The combination of these factors is a component of the internal func- tional areas of creating competitive advantages. The development of competitive strategies is a key element of strategic planning of development and activities of tourism enterprise in unpredictable changes in external and internal environment. The application of strategic management tech- nologies creates opportunities for sustainable de- velopment of tourism industry businesses, improve- ment their activities, preservation and development of competitive advantages in the long term in a dy- namic development of tourism field. Traditionally it is decided to consider four basic competitive strat- egies: cost leadership, differentiation, focus (Porter, 2005) and early market entry. The strategy of leadership in costs, which re- quires advantages by setting lower than the compe- tition, the level of prices due to minimization of costs through mass production of standardized services, suggests that consumer bases his choice on the ba- sis of price, which leads to the random nature of de- mand and the inability to attract tourists who spend a lot. Currently, a similar approach (based essentially on Ford models of production) in the developed countries in regard to tourism is regarded as hope- less as its implementation is contrary to trends in de- mand towards individualization (Евдокимов, 2008). The advantage in cost, based on mass production and consumption, suggests unlimited extension of production capacity, which is unacceptable in the tourism industry. Combined with the seasonality of tourism this determines the instability of the indus- try, generates demand peaks that create an exces- sive burden on destinations and deplete its natural and sociocultural resources. In modern terms a priority for the tourism indus- try of developed in tourism way countries becomes differentiation strategy is based on achieving com- petitive advantage through unique, specificity of created tourism product and provides no focus on the power flow but the quality of the product. As a means of differentiation tourist services may be considered: expanding the range of services pro- vided; an individual approach to customers; improve service; offer specific services. Today many organizations of the tourism indus- try in Ukraine insufficiently appreciate promising strategy of differentiation, the system of measures to ensure the highest level of quality is implemented not fully. A lot of what this situation is caused by un- satisfactory state of tourism infrastructure, including underdeveloped transport infrastructure, worn but very expensive hotel fund for consumers and the poor quality of service. The deficit in most regions of Ukraine qualitative hotel funds is one of the most urgent problems of the industry. The focus strategy involves concentration on a small target group of consumers, a special orienta- tion of the company specializing in serving certain preferred market segments, providing an excep- tional level of service. The examples of realization of focus strategy in the hotel industry can serve as mini-hotels, congress-hotels, hostels, motels, spa ho- tels, etc., focused on placing of certain categories of customers. In Ukraine, the benefits of using a focus strategy are not fully implemented. It is necessary for further development of specialized types of tourism (religious, cruise, cutter and yacht and others) and expanding the network of specific accommodation facilities (such as hostels, motels, congress-hotels). The strategy of early market entry (pioneer) sug- gests a tour operator or travel agent to offer a radi- cally new tour, providing some original hotel servic- es, opening new unusual destinations or innovative trends in tourism. For enterprises of the domestic tourism industry initiatives of developing innovative products and use the same pioneering strategies are not widespread. The offers of traditional options of tourist services prevail. This is a prime example of Odessa – event tourism – yumorina, film festival, jazz festival, gastronomic festival, festival tourism, etc. However, for the bringing the new products to the market requires substantial support of regional and local authorities, product development within the inter-regional programs, the main objectives of which is to increase entry tourist flow and leveling of seasonality by increasing interest in the Ukrainian destinations as a whole under further development cultural and educational tourism. Thus, within the strategic management of do- mestic enterprises of the tourism industry the pri- ority options of strategic development should be focusing on the issues of quality of service within a comprehensive transition to a strategy of differ- entiation, providing strategic advantages through greater use of certain areas of the focus strategy and also the offer of innovative travel programs as an option of effective realization of pioneer strate- gy. Thus, for the effective implementation of these policies the support of all levels of government is necessary, involving improvement of the legal and regulatory framework governing the various areas of tourism and comprehensive development of tour- ism infrastructure, which requires, in turn, significant investments. The situation in the tourism market is adjustable in three ways: to initiate changes in demand via the formation of corresponding proposals; to change Competitiveness of tourism product: evaluation and approaches to provision 13 the size and structure of commodity offer due to changes in rates and structure of demand; to affect simultaneously supply and demand in the tourism market to achieve goals. Business activity of tourism enterprises is focused on meeting market demand. For this purpose one solves the problem of finding target markets, devel- opment of products with new consumer properties by their market positioning. In conditions of grow- ing competition, increasing demand both in inter- national and domestic tourism products, increasing consumer demands to filling, diversity and quality of tourism services the development of scientifically based marketing strategy is becoming increasingly important for tourism activity subjects. The marketing strategy is the basis of tourism enterprise market activities. It helps to optimize its internal environment and provides advantages in competition, achieved by providing the range of products (services), which more fully meet custom- ers’ high level of service and guise of psychology and behaviour of consumer through the use of mo- tifs belonging, mode of expression, preferences and knowledge (Кулєшова, 2007). Stable functioning of tourism enterprise in the market is determined not so much by its size, price, quality or breadth of the range of services but by the advantage of the set of these indicators compared to other companies that provide similar services. It acts as an indicator of competitiveness of an enterprise choice of marketing strategy for its development in the tourist market. In addition, the very selected de- velopment marketing strategy by the tourism enter- prise determines its positioning in the competitive environment in the services market. 5. the marketing of tourism destination Considering the competitiveness of the regional tourism product, special attention should be paid to the marketing of tourist areas. Marketing of tourist areas is very specific because it is determined, first, the nature of the tourism product, and secondly, the peculiarities of each tourism region. In its turn the development level of tourism in the region depends on the development of the region and the state as a whole. Tourism in relation to the regional develop- ment performs marketing functions as it helps to identify, to maximize and to meet the demand for regional products. Ph. Kotler, K. Asplund, I. Rein, D. Haider first drew attention to tourism, when gave a definition of mar- keting areas as entrepreneurial activities undertaken to create, maintain or change relationships and / or behavior relating to specific places. In his four aspect marketing model of areas he especially identifies a particular concept of marketing – marketing of rest- ing places that aims at attracting visitors and tourists to the resorts in the cities and countries (Kotler et al., 2007). Through the introduction of the market- ing ideas into the tourist activity, its destination has become the concept, having formed the direction of activity – marketing of destinations in the following aspects: definition, formation and forecasting desti- nations; analysis of the behavior and motives of con- sumers in various tourist destinations; assessment of destinations attractiveness for investors, public and tourists; promotion destinations (Зорин, 2009). The ability prevail in the tourism space by as- signing scarce of tourist benefits – is the basis of competitive of destinations. Competition between destinations is on the tourist flows, which requires investments that provide competitive advantage to destinations in increasing accessibility. Big tourism companies consider accessibility of destinations as one of the most important components of the strug- gle for the consumer market and its competitive advantage. Investing in accessibility now provides serious benefits. For this purpose, principles and methods of market segmentation, aimed at iden- tifying potential consumer groups of specific tour- ism product are used. Increasing importance in the struggle for accessibility acquires logistics – plan- ning, monitoring and control of operations carried out in the process of the tour, delivering travelers to destinations with minimal costs for the fullest satis- faction of individual needs of tourists. Many travel companies are considering their competence in lo- gistics as a key strategic resource to support the Life- cycle destinations. Another factor for the competition of destina- tions for physical space acts habitus, which is under- stood as a place of comfortable life, cultural com- munication and social capitalization. Habitus – is a beginning that generates, unifies and brings their internal and relational characteristics of any position in a single lifestyle, a single ensemble of choosing of people, goods and practices (Bourdieu, 1994). As a result one and the same destination or the same benefit of the destination may seem subtle for one, ambitious or “bizarre” for other and vulgar to third. Due to the fact that tourists cannot meet their recreational needs outside and independent of des- tinations (which are necessary conditions and pre- requisites of tourism itself ), tourists as social agents can operate only “inside” the existing destinations and, thus, only reproduce or transform them. Hence, marketing of destinations – are activi- ties aimed at creating the best conditions to meet 14 Arthur Levytskyy the recreational needs of tourists, changing not only their motivation, but the entire system of spiritual guidance and human values. At the core of management system of competi- tiveness of tourist destination – is a qualitative tour- ism product (Тарасенок, 2010), which is the main target task of functioning of management system of competitiveness of tourism destinations and all management decisions must be evaluated in terms of their impact on this indicator. It is important to understand that the whole tour- ism resources are not a product of tourist destina- tions. The product has to represent a complete set attractive for target segment of tourists. All the ele- ments of the product must meet the actual state of tourist demand. It is fundamentally important that the composition of the main tourism product in its quality and quantity was sufficient to attract tourists. Marketing approach to destination involves the development of an integrated product destination, which will be offered to the tourist as a whole. All the elements of the product of destination must match the needs of each other and target segment. When the destination has several target segments that are fundamentally different in their motives, demands and expectations of tourists, it is necessary to devel- op a product for each of them. Thus, the basis of des- tination marketing is the creation and development of demanded competitive destination product. Destination marketing strategy – is part of a larg- er strategy of tourism development in the region, including infrastructure development, optimization legislation, the distribution of financial flows, attract- ing investment and so on. Marketing strategy identi- fies – who are potential consumers of that product and what characteristics (properties) will be most demanded by tourists, what the destination has to develop this product, how will the product of des- tination promote to market. Destination marketing strategy should be built depending on the selected priority types of tourism activities provided with personnel, infrastructure facilities, formed tourist product. However, the strategy itself does not guarantee development and success of destinations. To obtain the expected results the activities of management and marketing of destinations should be consid- ered as integrity of strategic, project and operational activities. Such integrity should be reflected in the structure of the strategy itself: developed action plan to achieve the mission must be brought to the level of alternative projects. Description of pro- jects, in turn, should give an idea of what values will the consumers of tourist destination products get during the realization of strategy by taking an active part in this. 5. Project approach to provision of competitiveness of tourism product Reorientation of domestic tourist flows from the Crimea to the resorts of Greece, Bulgaria, Turkey, UAE and foreign flows to Asian and African countries require quick action to ensure the attractiveness of domestic tourist product, which should be small projects focused on short-term travel and high qual- ity tourist service by reasonable prices for Ukrainian tourists and interesting tourist routes and tours are not yet known to foreign tourists places. Therefore, the basis for the formation and implementation of strategies providing the competitiveness of the national / regional tourism product should be the project approach with tools of cognitive marketing, based on the prevention of the occurrence of con- sumers’ needs on the quality of tourist services, in- novative tourism products and their components, new routes and different forms of meeting the tour- ist demand. Considering the lack of targeted planning of tourism in Ukraine and in the majority of its regions, fragmentation, vagueness, time uncertainty of the proposed measures of realization of Strategy of Tourism and Resorts development, the turbulence of the environment, it is reasonable to use the pro- ject approach, built on the integration of manage- ment functions and project structuring processes aimed at the effective achievement of its objectives through the use of modern methods and ways, techniques and technology management to get the planned project results on the composition and scope of work, cost, time, quality and satisfaction of participants. Designing – is a special kind of management technology based on project approach. The basis of the project approach is the project view as a con- trolled change of initial state of any system (e.g., state, region, organization or company) related to the time and money expenses. Investigation of process and regulation changes, implemented in advance by developed rules within the budget and time constraints, are the essence of project man- agement. Under the project we understand the of complex structured logically interrelated tasks and measures ordered in-time, aimed at solving the most important problems of the state development, some sectors of the economy, administrative and territo- rial units or local communities, organizations and institutions and are carried out in terms of financial Competitiveness of tourism product: evaluation and approaches to provision 15 and other resource constraints in due time. Thus in conditions of limited time and resources unique products or services that were not developed earlier and different from existing analogues are created. Designing is carried out by appropriate manage- ment technique. Potential possibilities of project approach allow: to imagine the ideal model of func- tioning and development of a particular object; to describe the actual and future challenges in respect of the object; to identify mechanisms to achieve the objectives and their relationship; to project a new image and structure of the researched phenomenon through appropriate programs; to compare ideally constructed samples of the object with the forms and stages of its real function. Development of a new tourism product needs its design. Tourism or tourism and recreational designing – is a project activity in tourism and recreation sphere. From the basic definition of “design” we can under- stand its multifunctionality relatively to tourist-rec- reational activities: (1) it can refer to specific objects (such as tourist base); (2) may be associated with the formation of a specific prototype state – develop- ment of concept, program, tourism development strategy in a particular area; (3) can be oriented to the development of a specific tourism product (or service). Thus, tourist and recreational designing can be viewed at three levels: designing of tourism in- dustry; designing of tourism products; designing of destination development (tourist and recreational complex) or the tourism industry as a whole in a par- ticular area. Tourism designing – is a combination of types of creative and innovative activity, during which tour- ism project appears – materialized or intangible result, which shows signs of novelty and created specifically for the needs of tourism industry devel- opment, optimization of enterprises tourism activi- ties, meeting the demand of consumers of tourism services. Tourism designing has certain characteristics: limited terms of designing and construction of spe- cific projects; the novelty of the product (service); sequence of stages, development and implementa- tion of the project. Tourism project should be based on a reasonable balance between timing and budg- et to create a unique product, which delivering to the consumer is the purpose of the project. Creating a unique product (service) is possible only by pro- viding the effective use of tourist and recreational potential of the territory, taking into account formed and potential needs of the population in tourist and recreational activities, willingness of stakeholders to develop tourism in a particular area. Bases of designing of tourist activities is the use of an integrated set of management methods and tools of influence on project participants through the development of personal responsibility for the safety and quality of services to be offered. There- fore, the methodology of project management in tourism aimed at meeting the needs of tourists while traveling through the initiation and implementation of projects in the destination, which is based on a set of methods to influence the management of each individual project to provide systematic unity of their portfolio. High dependence on influence of environment and the large proportion of innovation in tourism designing require specific management techniques such as dynamic programming, systems analysis, probability theory, queuing theory, and others. It should be noted that the methodology of the project approach in tourism at all levels of the economic systems is State Standard of Ukraine (SSU) ISO 10006 are: 2005 “Quality Management Systems. Guidelines for quality management in projects” (ДСТУ ISO 10006:2005 …, 2005), as requirements for all groups of project management processes are de- scribed in this standard. It is appropriate to note that the project-oriented management is used when we clearly define: project objectives and the end result; allocated or available resources; timeframe and constraints. Project-ori- ented management is characterized by a clear focus on the goal achieving – the creation of “project prod- uct”. Project-oriented management is seen as a new “flexible” method, which provides interconnection of creative efforts with the overall tasks of mangers. Its essence is to develop management objectives, identify problems requiring study and effective so- lution, develop program or strategic plan for solving the problems, removing obstacles to the achieve- ment of the goals (Безверхнюк, 2014). Successful implementation of the strategic goals of tourism and recreation industry development requires not only significant financial cost, but also well-organized control work progress at all stages, which depends on the skills, experience and per- sonal abilities of managers. Professional use of tools, methods and techniques of project management will allow tourism business subjects to ensure the effectiveness of project activities, reduce costs and perform the project in due time. Project approach differs from traditional ap- proaches to management by the following method- ological features and tool capabilities: a clear focus on product / result (financial resources sent not to the region or the industry in general but to the spe- cific project); innovativeness (new quality product is funded – its social value); state support and social 16 Arthur Levytskyy orientation; a high level of structural and functional coordination of all project participants because of their focus on the overall result; organized and well- planned monitoring of the project progress; the cre- ation of a common informative space; rigid system of responsibility for the proper use of funds; multi- channel financing model and so on. We know project lifecycle is in the basis of project approach, which is determined by the sequence of phases through which the project passes through- out its existence: conceptualization, development, implementation, closure. Since the projects are im- plemented in the destinations in tourism activities, so it is important to take into account the stage of the project lifecycle of destinations when develop- ing the project. At the initiation of the project at destination dur- ing ascent stage should be considered weak devel- opment of tourism, which is characterized by poor quality of tourist services, low prices, the initial for- mation of tourist image and low tourist traffic to des- tinations requiring a more detailed comprehensive project analysis, financial feasibility study, planning and structuring project. Extensive stage of destination lifecycle is charac- terized by expansion of the use of tourism resources, the gradual development of tourism infrastructure, increasing domestic and foreign tourist flow by maintaining low prices for tourist product and re- quires a large number of quality projects aimed at expanding and improving infrastructure to create an attractive image of territory. For example, the destination “Ukrainian Venice” (m. Vylkove) “Kob- leve” (Mykolaiv region), “Zatoka” (Odesa region) and others. Destinations of intensive stage of development need projects to increase the quality of tourist ser- vices, to improve facilities for the provision of tour- ism services, which is caused by the ongoing de- velopment of tourism infrastructure, increasing of tourism product prices, increasing domestic and foreign investment. Examples of such destinations in Ukraine can serve Lviv, Truskavets resort, resort “Bukovel”, Odesa, Kyiv etc. The cosmopolitan stage of destinations develop- ment involves the conceptualization and implemen- tation of high-cost, well-planned, qualificationally provided, integrated high-quality projects aimed at getting the multiplier effect of tourism and aimed only at the wealthy, both domestic and foreign tour- ists. Unfortunately, Ukraine does not have these des- tinations yet. In our opinion, the initiation of projects should be precisely in destinations with the support of local government and cooperation with scientific, project organizations, since knowledge of features of ter- ritory, tourists’ requirements on the material and technical base and the quality of tourist services, additional services require not only the definition of the problem, but forming the concept of the pro- ject, the comprehensive analysis, financial and eco- nomic justification, planning and structuring, using modern computer programs to control the project, integrated with project management systems into a single information system by the private, public and foreign investment. Considering these features of the project management accordingly to the life cycle stage of destinations will effectively initiate, implement and complete projects, and for the tour- ism sector in Ukraine – systematically develop. Thus, the project approach as the convergence of traditional and innovative methods and technolo- gies forms a basic platform for the adoption and im- plementation of effective management decisions. Most importantly, the project approach involves the use of modern information technology planning (MS Project, Oracle Primavera; Turbo Project, Spider Project, Clarizen etc.) and tools of monitoring that adapt depending on the structural characteristics of the planning processes, types and spatial-temporal conditions of realization of projects of tourism de- velopment within the existing and new programs as mid-term and strategic nature. Strategic approach should be consistent directly to the project approach. So no matter how well the strategy of development of one or another region has been discharged if it is not backed up by spe- cific projects, it can remain on paper. The project approach precisely makes it possible to convert the strategic plan into specific projects and programs of development of a territory. The combination of stra- tegic and project approach makes it possible to form a strategic project portfolio. It is necessary to define the strategic pyramid: which projects of a certain re- gion primarily need support and finance. The strategic orientation of tourism design- ing requires its regulation at the state and regional levels through the adoption of targeted programs of tourism development that will ensure the socio- economic efficiency of tourism and increase tour- ist attractiveness of Ukraine in the global tourism market. It should be noted that the development of tourism at the macroeconomic level, based on the detection of its regularities, trends, social, scientific and technical process requires the coordination of all sectors of the economy related to tourism. This relation will ensure the integration of efforts of the government and business to create a perfect tourist infrastructure based project approach. Application of project approach at macro level aimed at creating Competitiveness of tourism product: evaluation and approaches to provision 17 opportunities for searching and definition of attrac- tively investment projects in the regions, on the one hand and their implementation through the use of social initiatives, tenders, competitions, creation of clusters, marketing research, on the other. This ap- proach allows you to create an integrated set of innovative projects for comprehensive tourism de- velopment of each region through the use of local creative intelligence, able to implement developed and economically sound projects. 6. Summary Analysis of the main components of the tourism competitiveness of Ukraine has shown that, despite the availability of resource, our country, unfortu- nately, cannot compete with developed tourist countries. The only way to solve this problem – is to form a solid, strategically-oriented state policy, whose main task would be really identify tourism as one of the main priorities of the state, to create a strong authority to manage tourism development, to implement proven worldwide economic mecha- nisms of successful conducting of tourism business and to encourage investors to invest in tourism infra- structure in Ukraine. Competitiveness in tourism along with such characteristics as quality of tourism product, in- vestment attraction, social and economic potential is a complex concept. This means that its quantita- tive assessment provides the previous formation of set of different groups of indicators, determining their importance in integrated assessment or rat- ing. Techniques for assessing the competitiveness in tourism are now the most developed and popular at the macro level. Evaluation of competitiveness in tourism at the micro level involves the selection and analysis of two major facilities – tourism product and tourism enterprises. The competitiveness of the tourism product is caused by a synergistic combination of economic and marketing component, in the proportion of price and quality “impression” as integral character- istics that is defined as its advantage over another product that is similar to destination or its substitute while the potential buyer satisfies his needs. Howev- er, keep in mind that for assessing the quality of the tourist product there is no real measurement values. For objective evaluation one should use the criteria, which operates a consumer and which are essential in his view – the competitiveness of the product it- self and competitiveness of an offer and provision of product. The competitiveness of tourism enterprise can be assessed by comparing the most important crite- ria, summarizing the results of the company in terms of establishing a system of values. In the activities of tourism enterprises different competitive strategies based on certain conditions are used: the presence of competitive advantages, the type of competi- tion in the market, the nature of demand for tour- ist services, the size of the market share, the nature of tourist services, the level of expenses; price range and quality of products, the costs of innovation. Use of competitive strategy relevant to certain conjunc- tual conditions is one of the measures of sustainable business position in changing market conditions. Developing the competitiveness of the regional tourism product, special attention should be paid to marketing destinations. Marketing approach to des- tination involves the development of an integrated product destination, which will be offered to the tourist as a whole. All the elements of the product of destination must match the needs of each other and target segment. When the destination has several target segments that are fundamentally different in their motives, demands and expectations of tourists, it is necessary to develop a product for each of them. Thus, the basis of destination marketing is the crea- tion and development of demanded competitive destination product. To obtain the expected results the activities of management and marketing of des- tinations should be considered as integrity of strate- gic, project and operational activities. Such integrity should be reflected in the structure of the strategy itself: developed action plan to achieve the mission must be brought to the level of alternative projects. Description of projects, in turn, should give an idea of what values will the consumers of tourist destina- tion products get during the realization of strategy by taking an active part in this. Strategic approach should be consistent directly to the project approach. So no matter how well the strategy of development of one or another region has been discharged if it is not backed up by spe- cific projects, it can remain on paper. The project approach precisely makes it possible to convert the strategic plan into specific projects and programs of development of a territory. The combination of stra- tegic and project approach makes it possible to form a strategic project portfolio. It is necessary to define the strategic pyramid: which projects of a certain re- gion primarily need support and finance. 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