preferente World Travel Market Special
Tourism opens up to new marketing strategies
World Travel Market 2012 Special
Tourism abandons its traditional commercial model . . . . . . . . . . . . . . . . . . . . .
The Tourism G20 focuses the battle on visas . . . . . . . . . . . . . . . . . . . . . . . First century for Spain's main luxury hotels . . . . . . . . . . . . . . . . .
10-11 Theme parks resurface after adjustments ..................
preferente Published by: KBA S.L. C/ Francesc de Borja Moll, 18, entlo. 07003 Palma de Mallorca Islas Baleares (España) www.preferente.com firstname.lastname@example.org
Mediation is simplified with less players .......................................
Publisher and Editor: RAFAEL CABALLERO Assistant Editor: Eduardo Suárez del Real
Mallorca’s luxury offer continues to expand . . . . . . . . . . . . . . . . . . .
Co-ordinator: María Luz García Redaction: Natalia Blanes Rafa Fernández Manuel Suárez Javier Noguera Charo Hierro Translation: Louise Davis
Price and availability-key to success for beds banks . . . . . . . . . . .
High marks from the Industry for the Integrated Tourism Plan
. . . .
The Canary Islands, a destination still strong in winter . . . . . . . . . . . . . . . . . . . .
TOURISMlink, the European standard of tourism distribution that speaks Spanish . . . . . . . . . . . . . . . . . . . . . 16-17 Decalogue for an efficient hotel
. . . . . . . . . . . . . . . . . . .
20-21 Cruises emerge as the core of tourism holdings .............................
Distribution: Analía Malagrino Karina González Pablo Fernández
be r 201 2
Administration: Teresa Llabrés
Advertising: Ana Gómez Cover: Carlos Nadal Printing, layout and design: Gráficas Planisi S.A.
The Caribbean’s first leisure park is on the way...................................
Touris up to newmmopens ark strategies eting
November 2012 I WORLD TRAVEL MARKET I PREFERENTE I 5
Tourism abandons its traditional commercial model After decades of indisputable power, wholesale operators are battling a decline Javier Mato
he enormous losses of Europe’s largest tour operator, TUI, in the first quarter of this year and the fact that only the group’s hotel division is showing positive signs, are indicative of the end of an era for large tour operators. The crisis not only affects a shrinking TUI (fusion of the former German TUI with the British Thomson and First Choice) but also all its competitors, especially Thomas Cook, number two in the market. Each year the large operators are losing market share in a process that suggests the probable disappearance of a tourism model, at least as dominant agents. Tour operators were the predominant means of holiday sales for over a century since, in the middle of the XIX century, Thomas Cook, a travel agency based in Leicester in the centre of England, invented organized travel (its name survived the passing of time and has been adopted by one of the ‘leaders’). The model was to later expand on a very large scale with the appearance of jet planes permitting massive displacements of travellers from the cold north to the Mediterranean. Hand in hand with them appeared Europe’s
first travel resort: sin the Playa de Palma, the result of an initiative by some German tour operators. Transport by coach was a similar business, but this time in the Costa Brava. Travel agents contracted in Spain the construction of a hotel, guaranteeing the owner of the land an occupancy of the establishment for a set period of time, with a bank acting as interested mediating party. Thus, this model became the norm in the 50s and 60s. Tour operators expanded and controlled practically all the European holiday market, extending their network across different holiday models. They offered what a number of timid European travellers wanted: a comprehensive package including airport transfer, hotel, board, excursions, a guide speaking their language, the guarantee of a brand name, and all at a set price. Omnipotent. Such was the power wielded by these tour operators that it extended to aviation, including several airlines or travel agency networks, to a degree that in some Eu-
ropean countries all agencies were in the hands of these giants. Their airlines (Condor, Hapag Lloyd, Britannia, Air 2000) dominated the European sky, especially in the summer. They took the tourists to Spain, and Spain operated the hotels. Even the expansion of Spanish chains abroad was accompanied by the tour operators. The Caribbean destinations, although created for the North American market, need European mass tourism controlled by the hands of the 'expert' tour operators. Here, exceptionally, they also entered into the ownership of hotels, sharing half of the properties with Riu and Iberostar, although with the latter the crisis has caused Thomas Cook (previously Neckermann and Condor) to withdraw their investment. Spanish tourism entrepreneurs saw tour operators as both friend and enemy. Friends because they permitted them to sell their product without the need for a commercial network, without having to spend
The crisis not only affects the declining TUI but all its competitors, especially number two in the market, Thomas Cook
6 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
on branding, in fact, without having to do much of anything. And as enemies because upon them depended the final product price. Despite tensions, in the end commercial interest on both sides led to an agreement. Many considered sales through alternative routes. Some wanted to participate in the capital of these large companies, others created competition hoping to find a place in the market, only to end up remembering the saying ‘each to his own’. Nothing managed to affect the power of the large groups. For decades they appeared untouchable, a guarantee of growth, but also of price control. Shock. In the 90s the Internet appeared and with it came the beginning of the end, without the industry even being aware of the fact. In five short years it became clear that tourism was going to be one of the businesses most affected by the worldwide web. Why purchase in a travel agency if we can find everything on the internet? Why should a tour operator design the journey if we can tailor it ourselves? Once the internet was up to speed and we could pay online with reasonable guarantees, the model of the large tour operators hung in the balance, especially for relatively near desti-
nations where travellers are familiar with the surroundings and feel confident regarding safety and guarantees. Therefore, in theory, tour operators have their days numbered. Since then, the decline has been steady. First, because aircraft seats no longer have to be booked through the travel agent but are available online, normally at lower rates. Secondly, because hotels are also sold online, at first they commenced tentatively, but now they can be booked with great ease. So the traveller can design his own holiday. Internet addicts were the first to defy convention and slowly but surely there was a domino effect reaching all sectors of society. The Fall. Today, the former untouchable tour operators control less than fifty percent of Spainâ€™s tourism traffic. They remain in business but in exotic destinations where their experience and advice is necessary or recommended. Likewise, they are used for more specific products. We see then that wholesalers are in decline, with constant loss of market share. They still make sense among sectors of society less inclined to use the internet (especially
among the elderly), and for specific products (linked to events or sports and for long haul destinations with difficult access that require special know how) or in smaller markets (like in the case of Thomson, which has targeted British areas with no regular flights such as Aberdeen, Norwich or, until recently, Bournemouth). Logically, due to the abovedescribed situation, tour operator sales have been declining, with smaller and smaller margins and profit. For several years now there has been an image of battle stations: the urgent search for a new model that
will permit a new sales method for the business. However, the situation remains unchanged. Shareholders have fled. In this global panorama there are some instances which do appear to contradict the general picture, such as TUI in recent years when invoicing and profit showed an improvement. It was a positive outlook that appeared to uphold the model and was related to the strong decline of its competitors, but now its weak points have again risen to the surface. Tour operators will certainly not disappear and they may even have a resurgence, but they will never again be the centre point of mass
tourism, nor will they be a decisive factor in the sale of a destination. The recruitment of key figures as Directors for these companies (the Director of Vodafone Germany for TUI, for example) indicate that there is a serious plan to redesign the business, establishing a strong base for competing in an area that they no longer dominate, specializing in certain products. But if one thing is clear is that today the central agents in tourism are hotels, as they are the only part of the chain that is necessary and around which the traveller must programme his journey. â–
November 2012 I WORLD TRAVEL MARKET I PREFERENTE I 7
The Tourism G20 focuses the battle on visas T20 and WTTC make Mexico's Big Tourism Week Adolfo Favieres
he Spanish saying –legitimate although not necessarily true, claimed by those of us who lack great imagination- states that “Birds of a feather flock together”. But while we cannot choose our personalities, we do have choice about with whom we wish to mix. These were my thoughts on 15th May, in Merida, Yucatan, when I saw the twenty tourism representatives from the twenty countries that form the G20, that Committee of Delegates for the world economy in which Spain has no representation, nor expectation of being given any. The reflection would have been equally viable two day later on the Riviera Maya when the World Travel & Tourism Council (WTTC), Private Sector, celebrated its first “Regional Summit Meeting” dedicated to the Americas, with excellent content and debate. The T20 meeting is the fourth of its kind to take place. This one had special relevancy, compared to the previous three informal ones. On this occasion, the T20 convened by express delegation of the ‘all powerful’(?) G20, and its conclusions were to be transmitted, one hopes with an ensuing practical effect, to the meeting in Los Cabos. The analyses made at the T20 centred on proposing measures to governments in relation to tourism matters which could help contribute towards the creation of employment. The ability of tourism to create jobs is being re-discovered by political leaders at a time when there is hot debate between austerity and growth. But what is not clearly defined is that besides creating employment, tourism does so in three fundamental sectors: youth, women, and first jobs. ELIMINATING OBSTACLES. In its Merida Declaration, the T20 underlined the proposal that the G20 countries must remove obstacles for the mobility of tourists: elimination of visas, creation of regional visas, adop-
‘Family’ photo of the Tourism Ministers in Chichén Itza. tion of electronic visas and the simplification of migratory paperwork. A study by “Tourism Economics”, financed by the WTO and WTTC, was presented by its President, Adam Saks, stating that for the 656 million international tourists visiting the G20 countries, 109 million, representing 17%, needed a visa in order to travel. If the visa process were easier more people would travel resulting in more jobs and more revenue. The celebration, at the same time, and also in Mexico, of a meeting of G20 Ministers of Employment, meant that the T20 debated the subject of creation of employment in an indirect, but effective way. Each day, tourism will increasingly affect social and political issues. The evident confrontation between the easy entry into a country and its security measures will increasingly grow in favour of the former. Thomas Nides, the American Deputy Secretary of State came to confirm this, albeit indirectly. In short, it is to be commended that the G20 has officially given importance to tourism through the T20. As with any initiative, only continuity can ensure efficiency, but this is an important first step. The protagonism of the WTO and Taleb Ri-
8 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
fai, on a personal level, with his collaborators, Marcio Favilla and Carlos Vogeler, energized the meetings and drove them along the logical routes of a United Nations Agency, as could only be expected. SPAIN OUTSIDE THE 20. It is a great pity that Spain is not among those 20 countries, but that is another matter. The Spanish Tourism Secretary, Isabel Borrego, was invited by the hosting country, as were representatives from South American countries. But this is not quite the same…. And from Merida, Yucatan to the Riviera Maya, Quintana Roo, the place chosen by the WTTC for the meeting, that “Club of 100” to which I have referred at other times, where their first “Summit of the Americas” took place. The inauguration was marked by a vibrant speech, in apology of tourism, by a Mexican authority. This same person was protagonist on the morning of the following day in the first session, where he was submitted to a session of questions lasting forty-five minutes from Peter Greenberg, of the CBS. It is the same person who promotes the brand Mexico in a video that contemplates his ascent of the Teotihuacan
pyramids, his balloon flight over Monte Alban and his dives in the Quintana Roo subterranean lakes. With admiration and a touch of nostalgia, I attended the lecture speech given by the head of State and of the Mexican Government at this event, Felipe Calderón, just forty days from presidential elections in which he was not able to stand. He has been the Mexican President who has shown the most interest and concern for tourism since I can remember, and I remember many. The meeting organized by WTTC was typical of the usual one of this “club” dominated by the UK and the USA. The takeover of Presidency by David Scowsill from Jean Calude Baumgarten has not altered the perception of how we see it from relative proximity. It has specialized on two fronts: economic analyses and their annual summits. Sounds familiar? Latin America has never been one of its favourite regions. Perhaps this Regional Summit could be a first step to remedy what, in my view, is a tremendous error. Despite the perception of the USA as having great protagonism, one must not forget that this country is the main foreign market for many of the South American countries and it is necessary to hear their point of view. If Spain were to be left out of the G20, the Spanish associates of the WTTC would not be seen on the Riviera Maya. Will they invest in this destination? Only two Spanish speakers are among the total of sixtyfive. One of them, a representative of Iberia “stepped down” and was not replaced. On a more strategic level, WTTC’s interest as a melting pot for private enterprises joining forces with the public sector represented by the WTO. The good personal relationship between their respective leaders, Scowsill and Rifai, may enable this coordination and complement each other –something that not very long ago seemed impossible to imagine. Loose phrases may be pleasant on the ear but in tourism they do not wash. Forces must unite and the future be faced together. ■
Princesa Yaiza Suite Hotel Resort HHHHH L, an unforgettable client experience Located in Lanzarote, it has won several quality awards
n the Princesa Yaiza Suite Hotel Resort we work every day to improve our service and turn the holidays of our guests into an unforgettable experience in all respects. We put all our effort and dedication to improve every detail and thus get to meet and exceed the expectations of our guests from the first to last day staying in Lanzarote. The most noteworthy hotel news during 2012 have been as follows: The Princesa Yaiza Suite Hotel Resort has been distinguished with the ‘TUI HOLLY’ award, the world’s most prestigious tour operators’ award, given by TUI Germany to the top 100 hotels in the world with which it operates. The Princesa Yaiza Suite Hotel Resort is the only hotel in Lanzarote to win this distinction. Some of the factors considered for
this award include excellence in service, guest comfort and safety. These are aspects on which the Princesa Yaiza Suite Hotel Resort works constantly with enthusiasm and passion to exceed its own and its guests’ expectations. The Princesa Yaiza Suite Hotel Resort has revamped the bathroom amenities available in all of its rooms
so as to offer guests a different, exclusive product, adapted to the needs of today’s travellers. Since the beginning of July, the property’s bathrooms feature the 5-star amenities of the prestigious brand RITUALS. Following this recent addition of the brand Rituals to the hotel’s room amenities, as from October guests have the opportunity to purchase a range of the wellbeing and spa products from the Dutch brand in the Hotel’s shopping area to take home. Also, the Royal Kiko Suites will be kitted out with the new children’s washbags from Johnson’s Baby, which will be loved by the younger members of the family as well as their parents, as it is bound to make bath-time a much more pleasant and soothing experience. And thinking about families, since last month the Princesa Yaiza Suite Hotel Resort has had a new room type available by creating
10 adjoining rooms to provide a maximum capacity of 6 persons, even further improving our offering for families with up to four children. Indeed, our commitment to the family market has recently won us recognition from the prestigious international Jané guide as a recommended establishment for families with children. Also, considering couples, we have created a new type of room, only for adults, the “double relax rooms”, as from May 2013 designed to make the most of a relaxing stay and full of feelings in a unique setting. Our couples can enjoy daily 'Thousand and One Nights' Circuit at the Thalasso Center, rooms with aromatherapy pillows, and in the morning they can enjoy a la carte breakfast in our gourmet restaurant Isla de Lobos, overlooking the Atlantic Ocean and Fuerteventura, tasting a wide variety of products served by a highly qualified and dedicated staff. Finally, the latest improvements in our rooms for persons with reduced mobility include the installation of tilting mirrors in the bathrooms, lowering the height of the wardrobe bar and safe deposit box in the rooms, and enlarging the shower area with a new access ramp and a larger protective screen. All these new features are intended to improve the experience of our guests at the hotel, exceed their expectations and ensure they enjoy a very comfortable and memorable stay with us. ■
November 2012 I WORLD TRAVEL MARKET I PREFERENTE I 9
First century for Spanish main luxury hotels The four hotels promoted by King Alfonso XIII celebrate their first one hundred years in a good moment
M. L. G.
he 17th May 1902, date of the coronation of Alfonso XIII, and 31st May 1906, date of his marriage to the then Princess Victoria Eugenia of Battenberg, are something more than two historic moments reflected in the textbooks, for they also mark the beginning of luxury hotels in Spain, thanks to their promotion by the King himself, after suffering in person from the inexistence of suitable hotel establishments to house his guests at both events. Having travelled extensively throughout Europe and being aware of the standards of luxury and excellence in numerous new palace hotels, the monarch realised that Spain was missing out on modern hotels, a world in which Europe’s high society is then moving. He therefore personally involves himself in the building and start-up operation of this type of establishment, previously unkown in Spain, in order to place Madrid
at the same level of other European capitals, meaning that it should have a royal luxury hotel. Thus, the Ritz is born (1910) and the Palace (1912) both in Madrid, the María Cristina in San Sebastián (1912) and the Alfonso XIII in Seville (1928), hotels that were to mark an era and which today, practically one hundred years on, are still there, with a luxury product, faithful to the philosophy under which they were first created.
events of the XX century. The hotel is privileged for having been the first luxury hotel to ever exist in Spain and to commence a new era, one in which clients not only belong to the European aristocracy but, thanks to the appearance of the railway in the latter part of the XIX century, to also welcome a new type of traveller, wealthy Europeans and Americans eager to discover the cultural treasures of Europe, and who look for this type of establishment in which to stay. Situated in the heart of Madrid, the hotel was deigned by Charles Mewes (who also designed the Paris Ritz) under the supervision of two of the best Spanish architects of the day, Luis de Landecho and Lorenzo Gallego who interpreted with great precision the perfection of the classical design imposed by their French colleague. The elegant structure of the Hotel Ritz also has the privilege of being the first in Spain to be built in steel. Over these 102 years, numerous personalities have stayed at the hotel, from royalty to politicians, and people from the world of art, music, theatre, science, fashion and the arts in general. And all people at the top of their field of work. There are numerous anecdotes from such visitors to the Ritz which now form a fundamental part of the establishment’s history.
The monarch realises that Spain is missing out on modern times
THE FIRST OF THE LUXURY HOTELS. The Ritz today is one of Europe’s great luxury hotels. Since 2003 it belongs to the Orient-Express group and ownership is equally shared between Orient-Express and Omega Capital. It has 167 rooms, of which 13 are suites and, since it first opened on 2nd October 1910, it has been witness to the great
10 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
EUROPE’S LARGEST. The Hotel Palace, operated since 1st March 2000 by Westin Hotels and Resorts, underwent extensive refurbishment throughout, to provide it with the latest fire prevention equipment. It has 467 rooms and suites in Belle
Epoque style. Standing on land which formerly housed the palace of the Duke of Medinaceli, it was built in just 18 months and on 13th September 1912 opened its doors as Europe’s largest hotel adding to the luxury hotel offer of the Ritz whose size was clearly insufficient to meet new and growing demand. Its construction also counted with the personal interest of Alfonso XIII who interviewed the Belgian hotel proprietor George Marquet, owner of hotel chains in the French Riviera. At this meeting Marquet is encouraged by the King to build a hotel in Madrid and he sends a group of experts to the Spanish capital to search for possible locations. The first attempt made was to purchase the Ritz but the owners refused. He then decided to build his own hotel with the backing of Alfonso XIII. This new hotel was to offer better service than its competitor. Several locations were considered, one in the Gran Vía, but finally the plot of the Palace of the Duke of Medinaceli was chosen., as at the beginning of the XX century it was the best location in Madrid, near to the political centre (Congress), the financial centre (Stock Exchange), and social centre (Puerta de Sol) and later the cultural centre, due to its proximity to the Prado Museum. With an investment of 15 million pesetas, construction of the Palace commences, and it is inaugurated one month after its opening, on 12th October, by the Spanish Government, represented by the Prime Minister José Canalejas, and several thousand invited guests, with the absence of the King, due to the recent death during childbirth (15th Sepember) of the Princess María Teresa. Throughout these 100 years, the Palace has been an active part
of Madrid life. Since it opened it has been a meeting point and a participant in all relevant events concerning the history of the country. Its rooms have been the scene of meetings, parties and other celebrations of local, national and international life. Since its creation the hotel has been visited by artists, intellectuals and politicians along with others interested in observing local life, as many celebrities passed through its doors. DOCTORS CHANGE THE FUTURE. In 1845, the royal doctors made a decision which, without their knowledge, was to change the future of San Sebastián. At that time, the skin complaint of Queen Isabel II had become a serious problem and solutions were sought. The doctors advised her to take a treatment based on sea water. The royal court, following their advice, moved to the north for the summer. The aristocracy soon followed. The city thus became fashionable and by the end of the XIX century it was Spain’s
most important summer holiday destination. After the King’s death in 1885, the Queen Regent María Cristina continued the tradition and spent her summers in Cantabria. On 9th July 1912 the Hotel María Cristina opened, designed by the French architect Charles Mewes, who also designed the Ritz in Madrid and that of Paris. And the first person to cross its threshold was the Regent María Cristina. It is recorded that she arrived in a pretty Landau, accompanied by a lady in waiting and the Marquis of Aguilar de Campoo. In a busy, lively city, the hotel became the pride of the locals and centre of their social and cultural activities. Society’s crème met in its rooms. During the First World War, the María Cristina was a meeting point for politicians and artists who would later be replaced by stylists and Paris fashion icons, with Coco Chanel, Jean Patou and Paul Poiret at the head, especially in post-war years.
After the second World War, the hotel underwent a series of extensions and refurbishment. In 1948, under the architect Manuel Urcola, a new wing was built and the former L-shaped ground plan was transformed into a U. In 1985, under the architect José Miguel Martín Herrera, the hotel was awarded five star category. Since 21st September 1953, when the San Sebastián Film Festival commenced, the name of the Hotel María Cristina has added personality and an international image to the event. Filmstars choose the Hotel María Cristina San Sebastián year after year for their home during the Festival. With 136 spacious rooms and suites in Belle Epoque style, the establishment has been fully renovated and now forms part of Starwood’s The Luxury Collection.
The country had no hotel worthy of royalty and high society
THE ROYAL BANQUET. The ‘youngest’ of the four hotels, the Alfonso XIII in Seville, opened its
doors on 28th April 1928 offering a sumptuous banquet over which the Monarch himself presided together with Queen Victoria Eugenia, on the occasion of the marriage of Princess Isabel to Count Juan Zamoyskyi. This classic Spanish hotel, named after the king who was behind its creation, is 84 years old and was recently closed for one year when it underwent an ambitious renovation project in which history and modernity have been combined, with wooden ceilings and marble floors, across which Hollywood stars and famous bullfighters have stepped. Managed by the Starwood group, which has invested over 20 million euros in the renovation work, the hotel has 151 rooms and now offers two new suites: Reales Alcázares, with a decoration inspired by the love tryst between king Pedro I The Cruel and his secret lover María de Padilla; and Torreón, a tower suite with access to a large terrace and one of the establishment’s most distinctive features. Also the long-standing catering service has been restored, for this hotel was a pioneer on offering this service to the local aristocracy and royalty. ■
Mediation is simplified with less players Transparency offered to clients by Internet hastens distributions specialist on the final consumer Triping and World Travel Bitakora, promoted by specialist agencies in which they mainly group their own product within this market segment. Within this framework there is also the appearance of ‘flagship stores’ by tour operators that specialise in long haul such as Catai, Kuoni, Nuba, and to a certain extent Vibo with its new name. The paradox lies precisely in that the two large agency networks -excluding Viajes El Corte Inglés-, have been obliged to concentrate on the holiday product due to the difficulty in training an enormous number of agents about so many faraway destinations. And at the same time as this occurs, tour operators such as Iberojet, in the case of Orizonia, have launched direct promotions, in some way threatening its own retailers, Monica Llibre and Guillermo Costigan
etailers and wholesalers have been taking steps over recent months with the former acting more as tour operators while the latter have been trying to launch into direct sales to establish their brands with the final consumer. Wholesalers have always been careful not to annoy retailers on whom most of their sales still depend. And therefore the first tour operators to promote themselves individually ensured to remind everyone they could “find more information at their travel agency”. But this add-on is in ever-diminishing font size. Instead of demonstrating outward hostility, as was their initial reaction, the reply from agencies to a tendency that is now seen as unstoppable, has been to group together to reduce costs at the time of selling their own product, whose share is on the rise.
The market itself had caused this. Online agencies have started to specialise in flights and hotels, while the client has begun to opt for direct sale. The two large groups, Globalia and Orizonia, had concentrated on holidays, making their profit from volume and their ability to lower prices. Specialist agencies have continued to offer value while, finally, for the independent general retailers, the panorama has become difficult. This map does have holes in it. One of them is that the sale of long haul holidays has not taken off online. The value of an agent is still crucial. Consequently, this is the segment where tour operators have begun to publish their own offers and where specialist agencies have grouped together to widen their offer and reduce costs thanks to their synergy. Catai has launched campaigns in the general press offering their own packages for destinations in which they have enormous experience, while webs have emerged such as
Tour operators will promote flagship stores for holidays that require consultation
12 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
the main sales channel of its wholesalers. Attempts by the large groups to enter into long haul travel have not taken off, while the market concentrates on its ability to fill resorts so each year they have more business but less profit and therefore less margins. For this reason intermediation will lose players and tend to simplify. This is fruit, on the one hand, of the transparency brought by Internet. Thus a clear cycle change is seen, and the final product achieves greater value. The client can, and prefers, to speak directly to the organizer and not with the person who is sub-contracted. Large wholesalers are witnessing that if a client seeks a recognised brand, he opts more and more to exclude the intermidiary agent. At the same time, businesses consider that they do not have to be successful if this depends on whether the agent decides on a yes or a no. The worsening crisis –already almost a depression- has meant that in recent months both wholesalers and retailers have speeded up the process of eliminating intermediaries in keeping with client demand. Initiatives such as Triping or the direct promotion of tour operators have this common denominator. ■
Bed banks for greater flexibility Both Orizonia and Thomas Cook have promoted their bed bank divisions with the former creating Solplan Beds and, from May 2012 another brand by Thoms Cook for the German, Austria and Swiss markets. Orizonia will re-group all bed offers of Solplan, Iberojet and Viva Tours, while Thomas Cook’s brand will exercise a complete change in the contracting model of vacational hotels in Spain. In reply to questions by Preferente, Transhotel is “convinced that the companies most capable of their products carrying added value will be those which consolidate within the market. What happens is that for many companies, these movements are more a complementary activity to their original business, but for distributors such as oursleves, this activity is our core business and our structure is designed to offer the most competitive product with excellent client attention. The focus is very different”. “The offer of different but inter-related products through one system (as can be the case of hotels and transfers, entrance to theme parks, etc) is a strategy that has proven valid and that will continue to be
so in the future” according to sources of the company based in San Sebastián de los Reyes. Transhotel understands that “classical tour operators are expanding their distribution channels and directing themselves towards the final client in the same way as they extend their product spread, seeking ways to maximise their marketing activity.
“These are times in which flexible models are required against the more rigid business structures, in which each player designs strategies of multi-channelling to reach out to the client both through intermediary and direct channels” declared the agency supplier. ■
upgrades and extends local cycle and walking routes for the low season period The new routes will be promoted internationally, and in a bid to increase winter tourism, the massive potential of Calvià’s sports facilities will be showcased to the various source markets.
helping to maintain employment for our residents. Furthermore, we are constantly seeking new and diverse products to increase the season, by way of working hand in hand with the private sector, the fruits of which are being reaped already during this year 2012, with the highest hotel occupancy in September and October, for the past four years.” We have 5 cycling routes, all contained within our municipal boundaries, making Calvià the
alvià's Town Hall will pull out all of the stops during the winter months, with a view to battling against the short holiday season, by way of promoting sports facilities to source markets. Calvià has no shortage of possibilities where sports are concerned, including walking and cycle routes,in general, facilities considered amongst the best in the Mediterranean. Some 80,000 promotional brochures will showcase no less than 11 walking routes and 5 cycle routes. Trade fairs and tourism events will be the venue for the distribution of said brochures, which will advertise these products to the Austrian, German, Scandanavian and British markets. Further information can be obtained from Calvià’s tourist information offices, or via the website www. visitcalvia.com Each and every one of the advertised routes are in great
condition, with clear signage and pictorial information. In addition to the above mentioned website they will be posted on Facebook and
Calvià’s Tourism webpage gets a makeover An improved image and functionality were the main goals set by Calvià’s Town Hall regarding the makeover for www.visitcalvia.com. Colour, more graphics, easy access and practicality for users were key elements. Helpful, useful and interesting information for the visitor was fundamental, showing maps and pictorial directions for all sports facilities in each area. All the information you may need regarding Calvià’s resorts, facilities, beaches and services is at your fingertips, as well as direct links to some of the local hotel associations’ websites. ■
Trip- advisor. For local authorities and professionals, it is very clear that walking and cycling are two of the main activities attracting tourism during the winter months. Bearing in mind the potential of this municipality and the facilities on offer, it could easily become known as the number one Mediterranean destination in this field, with a quality and standards second to none. Calvià's mayor, Manu Onieva, stated: “It is our utmost priority to work relentlessly at lengthening the tourist season, in order to keep the hotels of Calvià open from March through to November, thus creating further bookings and
perfect base for cyclists. The route map created is the best working tool for cyclists, and as Mayor Manu Onieva said during the presentation, it is possibly the best one ever created by a public office. We have published 11 new walking routes for hikers, which will guide travellers through various rural trails that highlight our nature, our ethnological and our cultural heritage. Although cycling and walking are the main new concepts being highlighted during the 2012/2013 campaign, tour operators are also reminded of other excellent offers in Calvià during low season, like rugby, football and athletics. ■
November 2012 I WORLD TRAVEL MARKET I PREFERENTE I 13
Mallorca’s luxury offer continues to expand The Balearic government gives the green light to two top hotels and Hyatt opens on the island R. P.
he decision of the Balearic government to use the declaration of “local interest” has opened the door to two large hotel projects, involving the construction and operation of two luxury hotels –one in Canyamel (Capdepera) and another in Sa Rapita (Campos)- representing a 220 million euro investment and the creation of 1,200 direct and indirect jobs, during the building phase, and 300 jobs for when the hotels are up and running. This declaration, giving priority to the paper work involved in both hotels, does not represent a change in legislation, as Carlos Delgado, Tourism Councillor, stated. He insists that construction will take place “following quality tourism criteria regarding architectural integration, as traditional architecture will go hand in hand with the latest technology and with respect for the environment”. This project does reflect a decided impetus for luxury hotel accommodation in Mallorca and the landing of the International Hyatt chain. HYATT. However, the welcome given to both projects has not been equal in warmth. In the first case, Hyatt signed a framework agreement with the owners to manage the five star resort located in Canyamel, a project representing a 100 million euro investment and guaranteeing the distinction of grand luxury, so Mallorca's society has received the project favourably. But the second case is controversial due to the accusations and denials of politicians on both sides of the spectrum, in spite of the project being legal and the law protecting it. In the case of Canyamel, the new resort will have 142 bedrooms and 284 beds, according to initial plans, and will be aimed at “clients who seek a distinguished holiday resort and who demand very high quality standards”, according to Rafael
Bosch, spokesman for the local government, who also underlines that the Government, after careful study of the project, has decided to give it preferential treatment by means of a declaration of regional interest. This declaration, as Bosch comments, speeds up processes, reducing by half the stipulated time limits, guaranteeing at the same time a preferential character and speed in all paper work required by the Administration, thus “driving private investment”. The project has been submitted by Cap Vermell Hotels Projectes I Promocions S.L. and, according to the Balearic Government “fully coincides with the concept of local interest due to the special socioeconomic impact it will have on the eastern peninsula and its contribution to a rapid easing of the difficult economic situation being suffered”, for it will create 800 jobs, including direct and indirect employment. Hyatt, widely recognized and with a history of over 50 years, currently has a series of brands within the hotel industry; it operates, holds franchises, is owner or part owner and developer of hotels, resorts, and
residences worldwide. In total the company has 483 properties. In the concrete case of Hyatt Resorts, the brand has luxury hotels across the world, specializing in a quality product. SA RAPITA. In reference to the second project, involving the construction of a luxury hotel complex in Sa Rapita, submitted by Mirador d’Es Trenc S.L. and Cases de Sa Rapita S.L., with a planned investment of 120 million, this encompasses the building of a hotel with 285 rooms and 203 suites, along with a large sports installation including swimming pools, tennis and padel courts and a sports hall. This project, according to the Balearic Government, contributes “added value to the economic and social development of Campos” for it implies the private sector “being involved in the improvement of the quality of Sa Rapita and will be a motor of economic and social growth in the area to generate positive synergies in the environment”. In any case, what is certain is that since it was submitted, the construction of this complex has been politicized to such a degree that both
The construction and setting up of both projects represents a 220 million investment
14 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
the local Government and the Mayor of Campos have had to speak out in public to declare that the hotel is not in an area that is previously untouched, as has been communicated in different forums, but in an area that is open to “development, and so it has appeared in the municipality’s byelaws since 1991, and this project is backed by all legal frameworks; moreover, the town hall insists that in March 2009 a unanimous vote in favour of it was given and in January 2011, the same unanimous vote was again given in the Consell de Mallorca”. In spite of this, the matter has grown increasingly thorny with the passing of time and has even reached the National Parliament with a question being posed by Izquierda Unida to the Minister of Agriculture, Food and the Environment, Miguel Arias Cañete, in which he was asked if he considered if the project for construction of a hotel complex in Sa Rapita “complies with environmental regulations”, together with what measures would the central Government take to avoid this hotel being built as it has generated such controversy within Balearic society. Meanwhile, the Tourism councillor of the Balearic Government has insisted that it is a “project of local interest on land for development”, in accordance with the Territorial Pact legislation passed by the previous legislature, which was ruled by the Pact of Progress. Delgado has reconfirmed that the project does not involve the alteration of any land classification and the time for commencement of the building work is shortened by virtue of a law currently in force. The opposition criticize that those who state the above have a “lack of legal knowledge”, while the project has “the blessing” of all political groups within the municipality of Campos, because it not only enhances the tourism value of the area but involves the creation of 300 jobs in the hotel operation, 850 direct jobs during the construction and over 350 indirect jobs”. These arguments, nonetheless, have not convinced the opposition who classify the project as “a huge development scheme” caused by a “covert modification of the Territorial Plan”, a definition that has caused the President of the local Government, José Ramón Bauzá, to request “more respect and seriousness, because the project is drawn up with all necessary legal and professional reports and eliminates the legal insecurity they created in their legislature”. ■
TOURISMlink, the European standard of tourism distribution that speaks Spanish The European Commission awards the consortium P.ICT.URISM, leader in the ITH area of technology, development of this platform R. H.
ne of the tourism sector’s unresolved problems is the abundance of distribution systems in existence representing enormous investment in time and technology for any company that wishes to showcase its product in as many places as possible. For this reason when the European Commission met with the main tourism organizations (the European Association of Hotels, Restaurants and Cafeterias –HORTEC- and the European Consortium of Travel Agencies and Tour Operators –ECTAA-), these informed that a priority when making an investment in tourism
must be to remedy this problem. With this aim, the European Commission ajudicated the consortium P.ICT.URISM (Platform on ICT for Tourism), headed by the Institute of Hotel Technology (ITH)
16 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
in the technological area, development of a B2B European standard in tou-rism distribution systems for Europe, to take place between this year and 2014, which will form part of the European strategy for impro-
ving competition among the small and medium-sized companies. As Alvaro Carrillo de Albornoz, Managing Director of ITH explained to Preferente, “the same way that the European Union proposed that the mobile telephone industry must find a single charger for all, this platform seeks the same, to be a single system which all companies can access and where they can upload their offer for marketing companies to then sell them”. TO EVERYONE’S BENEFIT. According to the Managing Director of ITH, the creation of this pan-European tourism distribution and marketing tool will lead to an in-
crease in competition among European tourism companies, especially the small and medium-sized ones. It will make it easier to promote European destinations by differentiation, and make the tourism offer more accessible to agents and distributors in the market of origin and there will be more options with more segmentation to meet demand. “Until now, only large companies could afford to have a tailored distribution tool, for this is costly, but this platform will be freely accessible for the first wo years", states Carrillo de Albornoz. TOURISMlink. represents a revolution for it is a pioneer of its kind in the world, and “of which we must be very proud for it is a project that is 100% Spanish”, commented Carrillo de Albornoz. He also explained that: “The question for a long time was, why should a small hotel chain, for example, have to upload its product page by page in all the existing systems, and why was there not a common platform accessible to everyone. Technologically it is possible and so we have put hands to work”, explains Carrillo de Albornoz.
their experience with the platform the European Commission granted the technological development of P.ICT.URISM to ITH, who won the tender against giants such as Everis, Amadeus or IBM.
Additionally, among the many advantages of the platform is that hotels can, depending on their product, reorganize their distribution map and give more importance to online channels in say, Germany, especially in the product segments that such a market requests, and it can be done using a single platform without having to negotiate distribution agrrements with each local tour operator, German, Spanish or international. VALENCIA ORIGINS. ‘P.ICT.URISM’ will be developed using the basis of a former project 100% Spanish that was born with the same idea in mind that is
now to be a European standard, but on a Valencian level: Travel Open Apps. This development was an initiative of the Valencian Tourism Agency and the Institute of Hotel Technology, and was launched early in 2011. One year later over 400 companies are using this tool to market their products and services in national, European and international markets and sales have already exceeeded one million euros. “This summer, we will see the great hatching of this platform as it has now grown out of infancy, and from May the complementary offer has also been loaded, for prior to this only hotels and agencis participated”. Thanks to
SCHEDULE. The P.ICT.URISM project will last 30 months: from the beginning of 2012 until July 2014, when the ITH will put forward business and management models to allow the platform to consolidate as a unified tourism distribution system within Europe, either through a model of public, private or mixed management. The key lies in turning the techological costsaving into profit for the tourism companies and part of this to be spent on the tools that generate it. P.ICT.URISM has a total cost of 4.5 million euros, of which only 2 million come from European funding. The other 2.5 million correspond to the cost (assumed by the Valencian Community) of developing and putting into operation Travel Open Apps, the platform on which the architecture of the European standard is based. ■
November 2012 I WORLD TRAVEL MARKET I PREFERENTE I 17
Max Insurance Brokers, a necessary consultancy in the Dominican tourism industry
José María Gónzalez, Business Director East; Jeannidalia Grullón, President of Max Insurance Brokers; Juan Manuel Ureña, Vice-President Technical Area; María Rojas, Executive Vice-President and Eric Lembcke Moreaux, Business Director. M. S.
ax Insurance Brokers is a company that fills a need within the Dominican tourism industry to such a degree that hotel companies represent 23.26 percent of its corporate client portfolio. What is the experience of Max Insurance Brokers in business carried out with hotel chains in the Dominican Republic? What percentage of your client portfolio falls within the hotel industry? The experience has been challenging. Tourism market requirements are very strict because the majority are franchises set up elsewhere in the world and they arrive in our country with lines we must follow and comply with. This means that we constantly have to improve our specialist consultancy services in this sector in order to satisfy their needs. Likewise, we must carry out a risk analysis for any possible exposure, in order that they comply with the standards demanded. The hotel industry represents 23.25% of our corporate client portfolio. The fact that you are also in Bavaro reflects your aim at capturing the tourism market. What are your short term plans relating to
business with companies and hotel establishments? That is correct, our branch allows us to offer a more efficient and personalized service, for that is one of the most developed tourism areas. Our main aim is to be a leader and place ourselves among the main insurance brokers within the tourism industry. What are the principal services you offer to hotel chains and the tourism industry in general? We analyse specific risks to which tourism companies are exposed. This allows us to make a good diagnosis in order to draw-up the insurance programme, obtain the best payment conditions, guarantee cover permanency, and advise them appropriately whenever there is a claim, offering follow-up and ensuring contracts are fulfilled. We guarantee the best possible loss recovery, offering our support with staff thus avoiding unnecessary operational costs for their company. We instruct on the most effective use of their insurance programme and obtain the best market conditions, guaranteeing value for money. For this, we have branches in strategic places and offer a 24 hour service for claims. What strategies to do you use to determine your growth and capture new clients?
18 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
We make personal contact with potential clients and always have a “Stakeholder” bilateral communication plan that helps us develop market niches to develop related products. One of our main strategies is that of Market Development, for this allows us to offer the existing products adding value by means of additional benefits that the company offers its clients. What peculiarities does the Dominican Republic have in regard to other neighbouring countries and what attracts new investors? In spite of the world financial crisis the Dominican Republic has maintained good growth. Ours is one of the most financially and politically stable countries in the Caribbean. Most of the year the temperature is above 20°C. “Moreover we boast an excellent geographical position, near to the United States and Central America, areas of strong econo- mic development at the moment. We also provide qualified and highly- competitive labour, a modern infrastructure and services (International airports, ports, roads, banks, schools, great telecommunication development) plus low taxes on property purchase (3% of the property value).”
What do you consider to be the area of the Dominican Republic in most demand for insurance companies? The area of Santo Domingo is the greatest commercial area for the company, followed by the east of the island where there is the highest concentration of tourism. There is high demand for insurance policies in the capital, Santo Domingo, and we attribute this to the area being where most vehicles are, and this is a growing market, so much so that the branch of car insurance is the area that has experienced most increase in volume in regard to net premium insurances, with 5.799.915.960 sold in the first eight months of 2012. Do you think that the Dominican tourism industry still has margin for growth? We believe it does, for the executive body of the Dominican Republic has developed strategies and support for foreign investors to continue developing the industry. Taking as a base the reports from previous months that were issued by the corresponding governmental bodies, next year looks positive. There is a plan to build 30.000 new hotel rooms over the following 10 years meaning the arrival of over 10 million tourists. What has been done to face the crisis and to continue driving your business in the country? We have made processes more efficient: developing strategies of differentiation in service, extending insurance sales channels, reducing expenditure, optimizing our technology platform, which is one of the most advanced on the local insurance market, and offering follow-up constantly to achieve our proposed objectives in each area of the company. “In spite of the financial situation, we placed ourselves among the top businesses in the sector in 2009 and we continue to increase our client portfolio and hope to become the leader in the insurance market”. ■
November 2012 I WORLD TRAVEL MARKET I PREFERENTE I 19
Decalogue for an efficient hotel How to improve energy efficiency and sustainability in 10 easy steps Ricardo López de Carvajal
ourism, especially the hotel industry, is a huge energy user. A great part of a hotel’s energy bill includes consumption linked to air-conditioning and heating, water heating and lighting. All this energy consumption is measured not only in euros, but also on its environmental impact, a sensitive issue for the tourist who is looking for accommodation that is sustainable and caring towards the environment. The key is in knowing where to begin. Therefore, the Hotel Technology Institute (ITH) proposes
a route map with 10 points to make a hotel more efficient and sustainable; steps that follow three basic criteria, as Oscar Alonso, from the ITH department of Sustainability and Efficiency explains, stating that the first step is “the amount of investment required and its return, and the second is the level of intervention required to put in place each solution”. HUMAN TEAM. If a hotel plans to save energy, its management must create a handbook of how to achieve it. In the case of hotels, this involves establishing standard procedures contemplating a modus operandi for employees, especially the
20 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
The Hotel de las Letras in Madrid has achieved significant savings
maintenance, cleaning and food & beverage staff. Luis Ortega, Corporate Director of Engineering and the Environment for NH Hoteles, always insists that “the key lies in policy and procedure”, implying an improvement in procedures and company handbooks, especially in the area of maintenance and cleaning, areas that can represent significant improvements in energy consumption. REVISION OF CONTRACTS. It is important to revise energy supply contracts to be fully aware of their conditions, possibilites and tariffs, in order to search for better
prices, and see if the electricity power contracted is suited to the installations and the use made of it, or if the tariffs are linked to the needs of the hotel round the clock, something that only requires a study of the invoice and to renegotiate the contracts with the suppliers. Also important is to verify that there are no charges for reactive energy on the electricity bill, otherwise action must be taken to compensate by means of a series of condensers, which does not imply a high investment. TOOLS. The second step is to use modern tools to carry out a thorough study of consumption
in order to save energy. First one needs to know where to act and for this the best method is to incorporate a system of exhaustive energy consumption to monitor concrete variables depending on the hotel installations and the use made of them. If, additionally, these figures are compared with other external conditioning agents, such as climate and, based on these, the system is capable of acting on different hotel systems, energy saving will increase even further. WATER. Water is scarce and therefore the third step is to reduce its consumption without affecting client comfort, something possible thanks to a series of tools such as the installation of flow regulators, shower flow reducers and cisterns with dual flush, helping reduce consumption by half and, in some cases, increasing the guests’ sense of comfort. EFFICIENT LIGHTING. It is important to replace a hotel’s indoor and outdoor lighting with more efficient options, something requiring a little investment but giving rapid re-
turns. The first step is to change classic lightbulbs for low consumption ones, or LEDs, and incorporate elements of illumination control.
Once all efficiency measures have been put into place it is important to communicate this to clients and suppliers
TEMPERATURE. A change to more efficient gas boilers reduces energy consumption considerably, for gas is half the price of gas oil. The hotel's room temperature should be controlled so that it is comfortable and to avoid extra costs. ECO-FRIENDLY AIR-CONDITIONING. Air-conditioning, especially in coastal hotels during the summer months, is a necessity. If more efficient coolers are installed with less contaminating refrigeration units giving greater performance, that also allows (through an adaptable module) for the heat recovery to produce hot water, thus energy is saved.A module can also be installed for free cooling that is useful and profitable depending on the area that is to be cooled, because
it uses outside air when the temperature is optimum to regulate the building’s interior conditions.
PUMP SYSTEMS. Up to 70% of a hotel’s electricity consumption comes from pump systems, and for this reason, a change to more efficient equiment can drastically reduce energy costs. For example, Hotel Crowne Plaza in Copenhagen (Denmark) changed its pump system for more efficient ones developed by the company Grundfos, and managed to reduce energy consumption by 88%, allowing the hotel to recover the investment in six and a half years. ITH is going to study, through a pilot project, how these pumps work in Spanish hotels, given the positive experience in other international properties. ENERGY MIX. Renewable energies are no longer a utopia. In hotels, solar energy and bio-fuel are allies for
producing hot water. With suitable installations, a hotel can produce energy for its own consumption using natual sources and, therefore, it is a highly profitable system. Geothermal energy is also an interesting option for the near future, while micro cogeneration is already achieving excellent results and is especially profitable in establishments with installations such as heated pools, spas or their own laundries, like the Hotel Gran Conil. A BUILDING’S SKIN. The exterior of a building is a living organism that, like human skin, has an inner and outer layer and plays a key part in the balance of hot and cold within a building and in its energy consumption. A way to start would be to act on the general insulation of the facade and installing SATE (Outdoor Thermal Insulation Systems), which involves superimposing different layers of insulating material on the exterior surface of the building to enormously improve the building’s thermal efficiency, reducing thermal loss and improving acoustic insulation, thus increasing client comfort. ■
November 2012 I WORLD TRAVEL MARKET I PREFERENTE I 21
The Caribbean’s first leisure park is on the way Extrme Park Punta Cana will open in 2014
America’s largest leisure park of its kind has begun its journey. Located in an area covering one million square metres in Cabeza de Toro, in the region of Bavaro-Punta Cana, it represents a 180 million dollar investment and work will continue until 2014 when it is planned to open its doors. “Extrme Park Punta Cana” is considered to be the largest of such parks in Latin America, with many innovative attractions for the public and optimum safety controls for this type of infrastructure. The park will have four main business areas, outdoor and indoor attractions, an amphitheatre, a discotheque, and many other areas offering complementary services.
Francisco Javier García, Tourism Minister of the Dominican Republic, has stated that the project will contribute to the development of the industry, of the region and of the national economy, and that it will contribute to the government's goal of attracting 10 million tourists a year in the next ten years. In fact, Salvador Ballesteros, President of the Extrme Park Group, has promised President Medina to help him accomplish this objective and thus realize the promise he made during his election campaign. The new construction will be less than a three hour drive from the capital along the Coral motorway, another infrastructure that complements tourism promotion and the development of the eastern part of the country.
560 EMPLOYEES. The Project to be carried out by the Extrme Park Group will consist of a sports leisure centre, situated 7 minutes from the Bavaro beaches, and every imaginable type of service, generating 560 direct jobs.
PERFECT LOCATION “After studying several Caribbean destinations and analysing their individual potential, and after seeing the attention and support offered by the ministries of Tourism, Environment
22 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
and Civil Aviation, along with the backing of private enterprises during the period of prospection in the Domi-nican Republic, it was decided that the tourism destination of Punta Cana and Bavaro is the perfect location for Extrme Park”, commen-ted Ballesteros. Francisco Javier García, Minister of Tourism, has commented that “a park of this size, with so many at-
tractions, some never before seen in other traditional leisure parks, will undoubtedly result in Punta Cana becoming Latin America’s most attractive destination. The park’s main characteristic is that it is aimed towards family fun and both local and foreign visitors can complement their holidays in the area of BavaroPunta Cana with a visit to America’s largest leisure park. ■
The Dominican Republic aims for ten million tourists annually The Government focuses all its energy into achieving its goal
Ricardo L. Carvajal Danilo Medina, President of the Dominican Republic, stated it in his electoral campaign, he repeated it on the day he took possession of his post, and since then all efforts are aimed at achieving his great objective –to bring 10 million tourists to the country every year. To do this he has concentrated on decisions regarding developing the concept of multi-destinations with a wide choice, including community tourism, ecological tourism, adventure holidays, cultural holidays, and others, and to this end the ministries of Tourism, the Environment and Culture, among others, will develop joint policies containing local development projects, enabling tourism to encompass more than the traditional sun, sea and sand offer. Medina wants to strengthen the cruise industry and make the country a ‘home port’ option in the Caribbean, while also setting in motion the country’s Branding
Project, with an aggressive marketing of the Brand. In this regard, the President of the Association of Hotels and Tourism of the Dominican Republic (ASONAHORES), Luis Emilio Rodríguez Amiama, has commented that Danilo Medina’s approach of promoting tourism within his economic programme, means that this is the “best moment” for the industry, due to the excellent relationship between the latter and the government, and
because approval of public policies will encourage tourism growth. Rodríguez Amiama has repeated that at the moment they face “the best possible scenario for tourism, with a protourism President, who has a specific aim established personally by him, and a Tourism Minister who has been consistent in his policy of coordination with the private sector”. Likewise, he states that for the first time the country
has a President “who has placed tourism as one of the pillars of his project for the future”. For these reasons, ASONAHORES actively supports the efforts of President Medina in developing a policy that intends to achieve the figure of 10 million foreign tourists a year in the next ten years. He also explained that the association is “working with the Tourism Ministry to draw up an action plan” with priority actions and investments for 2012-2013, and this is why they have created an interinstitutional committee. This is the first time that ASONAHORES and the Tourism Minister, “take joint responsibility in drawing up a far-reaching action plan encompassing all aspects of development within the industry”, and he hopes that this atmosphere of collaboration will help in drawing up the Ten Year Tourism Development Plan required by the National Strategic Plan for Development. For his part, the Minister, Francisco Javier García, has made clear that tourism is one of the country’s most productive sectors with a rapid return on investment, and it is necessary for both public and private sectors to develop their strategies. In this regard, he underlined that the guarantee to comply with the target put forward by President Danilo Medina of achieving a minimum of 10 million tourists a year in the next ten years, lies in promoting the country, which will continue. Therefore, the international promotion required for the country in the remainder of the year and for all 2013 will be submitted to the Government, in order for this to be increased. “What both the Government and the private sector want is for more tourists to visit the Dominican Republic. The more spent on promotion, the more tourists will visit the country”, he explained. This is why “investment in this regard is indispensable”, he declared. ■
November 2012 I WORLD TRAVEL MARKET I PREFERENTE I 23
Dominican Republic: doorway to the Americas again Banco Popular, industry’s ally in attaining 10 million tourists
Mr. Manuel Grullón, President of the Banco Popular Dominicano, during his welcome speech at the reception offered by the bank to businessmen, in Paris. R. P.
f there is one bank in the Dominican Republic that can lay claim to a commitment to tourism it is Banco Popular Dominicano, the country’s largest private bank, which has been lending support for twenty years. Since the early nineties Popular has offered finance to the tourism industry for an amount exceeding one thousand million dollars. Today, the holding Grupo Popular and its subsidiaries have a credit volume of over 560 million dollars with the industry, representing 14% of its total portfolio. “This has been possible because our work philosophy contemplates continuous backing to tourism projects in all its aspects, working in a team with hoteliers, travel agencies, tour operators and the industry’s main institutes and associations for the benefit of the country”, stated the bank’s Vice-President for Business Tourism, Mr. Juan Manuel Martín de Oliva. The Dominican Republic is one of the most important tourism
destinations in the Caribbean, offering political and social stability and excellent prospects for investment. It is the tourism leader in the region with over 4 million visitors each year, showing continued growth in 2012 and very optimistic forecasts for next season. Recently, tourism has become the most important source for regular jobs, and it has been the driving force behind new infrastructures and competitive policies within the Dominican economy, which provides an extensive offer, and consolidation of new source markets in areas such as Eastern Europe, Russia and Brazil. The industry is also a drive for public policies encouraging this economic train within the country. 10 million tourists in 10 years. In reference to this, Mr. Manuel A. Grullón, President of the Banco Popular Dominicano, recently stated in Paris, where he was attending the French Travel Market –Top Resa, that the financial entity he heads is committed to helping the government objective set by President Danilo Medina to at-
24 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
tain 10 million visitors per year within ten years. The bank has the best tool for this: Popular offers an excellent business attention model, entitled Banca 360º, consisting of a team of people specialized in different corporate areas and in investment banking, with a full understanding of the needs of companies, corporations and institutions and a special dedication to the tourism industry. Their Area of Business Tourism is a specialist financial platform that places at the disposal of companies an offer of products and services that consider the particular needs of the tourist industry. This is a pioneering department and, today, unique within the Dominican Republic’s world of finance. The Dominican Republic, HUB for Caribbean tourism traffic. With this focus, the President of Popular sent a message to foreign investors, reiterating that in his bank “we support those who trust in our country and we back their attempts to make their tourism plans a reality. We have backed development and improvements to the life of the Do-
minicans for the past 48 years. The Dominican Republic, with the help of the Tourism Ministry and private enterprise, is prepared to again become the doorway to the Americas as it first was in the XVI century, and to be the hub of tourism traffic to the Caribbean, either by sea or air”. This is the main objective put forward in October at the Rendez Vous Santo Domingo fair, a professional forum sponsored by the Dominican-French Chamber of Commerce, which had the support of Banco Popular, among other entities. It was a unique occasion in which, for the first time, 30 large European tour operators participated, from Portugal to Russia. Different meetings discussions took place on the best way to diversify the Dominican tourism offer, developing formulas such as eco-tourism and sustainable tourism, from which local communities can benefit. Within the framework of this forum, the bank again demonstrated the opportunities available for potential investors to make their investments profitable, especially when they act hand in hand with a financial partner such as Banco Popular. ■
Mr. Juan Manuel Martín de Oliva, Vice-President for Tourism Business, Banco Popular Dominicano, during the presentation offered to guests at the Top Resa event in Paris.
Theme parks resurface after adjustments
These leisure installations increase revenue by 3% during crisis times M. Luz García
pain’s theme park season took off well this year and therefore its management teams are “moderately optimistic” and hope to “equal 2011 results” which registered a 3 percent growth, after an investment was made to renew their offer. According to the President of the Spanish Theme and Attraction Park Association (AEPA), Juan Peláez, this investment effort is particularly important within the context of a recession because “one thing a family tends to relinquish in difficult economic times is money spent on leisure” so “we are ma-king great efforts to not lose clients, using every available promotional resource within reach, via Internet, social networks, and offering family and school discounts” because one thing is certain and that is “when ente-ring the park, even when paying a lower price, there is always a spend, meaning more activity for internal businesses”.
IMPORTANCE OF THE SECTOR. Peláez underlines the importance of this sector for the country’s economy, as the parks within the AEPA (Port Aventura, Warner, Terra Mítica, Isla Mágica, Parque de Atracciones de Madrid, Tivoli, Tibidabo, Dinopolis and Parque de Atracciones de Zaragoza), welcome over 12 million visitors annually, half of these from abroad, representing some 500 million euros in revenue, including events carried out within the parks; they employ 6,000 people and generate, through indirect revenue, over 1,000 million euros in the service industry. And, as the AEPA President comments, 50% of the twelve million visits “are by tourists who stay at hotels in the surrounding areas if the parks do not have their own hotels, meaning these cllients contribute towards the success of local hotel operations". INNOVATION AND RENOVATION. To increase the number of clients and gain their fidelity in difficult times is not easy, therefore, all the parks have
26 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
made enormous efforts to innovate and renew their offer, according to Juan Peláez. , have made enormous efforts to innovate and renew their offer. “We are conscious of the fact that if nothing new is offered, the client will not return, and for this reason new things are introduced each year, such as films, attractions and shows, so that visitors know that every time they visit they will find something different from what they saw the time before". This must be simultaneously coordinated with “controlling operational costs, by means of negotiations with suppliers and increasing the market in order that the parks form part of what Spain offers its incoming tourists”. Peláez considers it essential to have the support of Turespaña, in order to carry out actions abroad through this agency and through the Spanish Tourism Offices. However, the AEPA President clearly states that this is not a question of indiscriminate promotion but one of accessing markets with the greatest potential for client capture, such as Portugal for Isla
Mágica or France for Port Aventura, besides the rest of Europe and the home market. For this reason they continue to “improve and offer a quality product” in order to close the season with positive figures, because, and in spite of a season that had a sluggish start due to a rainy spring, “we have recovered and intend to continue this way”. EVENTS. Also, AEPA is working on prolonging the season in the summer theme parks, whose “heavy demand is from 15th June to 15th September” and which make up 50% of the business. This is why it is important to lengthen the season and here the organization of events plays an important role. “Complementary activities are becoming more important, as are all types of celebrations, including company events, because parks offer complementary activities that are different to what have been the norm until now”, comments Juan Peláez, who also concludes that this is a relevant sector. ■
Port Aventura, a 45 million investment in two years Port Aventura is currently Spain’s most profitable theme park. The development of a strategic plan, first put into practice in 2009, comtemplating diversification and improvement of the offer with continual innovation, backed by an investment plan representing 45 million in the past two years, has resulted in the tourist resort achieving a turnover of 173 million in 2011, representing a 19% increase over the year 2010. These figures are mainly due to a decision to concentrate on the family segment, for 77% of all visitors were families. In 2011 Port Aventura registered 3.7 million visitors, an increase of 16% over the previous year. The introduction of the new theme, Sesame Adventure was a decisive factor influencing this increase, while hotel occupancy registered 297,000 overnights, 14% more than in 2010. One of every three clients visiting the park stayed at one of the resort hotels. In regard to the new season, Park representatives state that “hotel reservations are similar to those of last year, and they therefore expect to at least equal 2011 figures, although they may even exceed them. “One of the keys to success is the introduction of novelties making visitors return for second and third times”. Shambhala is fruit of this philosophy, the new big dipper and Europe’s largest, along with a driving school, a caravan site for 100 vehicles, and the renovation of 500 rooms in Hotel Port Aventura. These additions represented a 30 million euro investment in 2011, doubling the amount invested in 2010 to set up the family theme area Sesame Adventure, driving the international appeal of the theme park; moreover “currently we receive more
visitors from abroad, from countries such as New Zealand, and three out of ten visitors are foreign, a figure that the Park hopes to increase to 4 out of ten in the mid-term. The largest increase among foreign visitors is from Russia where the market has grown by 30%. ■
Price and availability-key to success for bed banks The giants try to constrain the onslaught of new players with exclusivity contracts M. L. G.
chieving a more economical rate and greater bed availability is the key to success for "bed banks". It is not a new formula but one that in recent years has become necessary for practically all tour operators. However, as pointed out by the professionals, one must remember that room tariffs on websites are the result of a series of factors for, on the one part, hotels sign direct contracts with certain online travel agencies and, on the other, they sell rooms to bed banks, platforms that manage the rooms by offering them to a multitude of operators. So when a person searches online for a hotel, the rate can be set by one place or the other and this is where the difference lies, for if it is from a direct agreement with the hotel, the price depends on the contract signed by each bed bank with the establishment in question, and the number of rooms that remain available.
SUCCESSFUL FORMULA. A successful formula in any case, and one that allows for several variations, according to Steve Heapy, Managing Director of Jet2, who comments that his company works with two important bed banks to help respond to the demand for beds in tourist resorts and also offers a large number of beds in city destinations. “Bed sales in beach resorts are only a tiny percentage of total sales; however, in cities bed banks provide the majority of sales. Our airline, Jet2.com has extended its routes and flights to
city destinations and at the same time Jet2holidays has increased efforts to sell city escapes introducing a brochure dedicated exclusively to this market segment because sales through bed banks have increased considerably” confirms Heapy. In this regard, he comments that in the past two years Jet2 has progressively abandoned using bed banks in beach destinations and increased their use in cities. As explained by Jet2’s Managing Director, they have seen: “a significant increase in city destinations, but 98% of our beach destination sales are still through direct contracts with hotels”.
"therefore that of our partners is also reaping benefits” confirms Steve Heapy. However, one thing is clear and that is that “in spite of the need for bed banks in cities, we will continue to work with direct hotel contracts in beach destinations”. This is because: the bed bank model makes it difficult to provide the quality required by an all inclusive tour operator, which is why we consider it essential to have a direct link with the hotels in beach resorts and guarantee the level of quality requested by our clients". In reference to whether or not the future of bed sales will remain as is, Steve Heapy clearly states that this: “depends on the support gi-ven to destinations by the airlines. If the airline market is limited to only a few operators, the traditio-nal model will remain stable, while in cities, where there is greater air traffic, the model of bed banks is very strong”.
Several elements are involved in website room rates
POSITIVE PROSPECTS. On a parallel level, prospects are fairly positive because their business volume in Spain is growing,
FIRST PRIVATE BED BANK. To speak of this sales model is to speak of Lowcostbeds, founded by Paul Evans in 2004. Today, eight years on, it has become the most important independent bed bank in the United Kingdom, 28 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
with over 150,000 hotels available of which over 4,000 have been directly contracted, thus achieving better tariffs, figures to which must be added those relating to the new website specifically directed at travel agencies in the U.S.A., allowing them access to over 250,000 low cost hotels and all the services offered by this sector. In fact, as Elodie Leunen, European Director of B2B for Lowcost Travel Group comments, this year’s turnover for the company has been “very positive. In spite of the economic crisis in Spain the population has not stopped travelling although people have changed their habits notably in order to save without having to relinquish their holidays, with reservations of 4 and 5 nights instead of the usual 7 nights. More self-cate-ring apartments have been sold to save on restaurant expenses, along with the famous all inclusive package allowing people to travel with a closed budget. Spain’s coastal resorts have also been the most popular this year allowing people to travel in their own car.” Lowcostbeds has only been present in Spain for one year, but internationally, other markets such as Ireland, England, Sweden and Italy have experienced enormous growth and sales have increased by 10% compared to 2011. “In only a few months we have seen an increase in travel agency demand on our website and having access to our product. Currently we have over 1,000 agencies registered in Spain and over 13,000 worldwide. And we continue to grow due to the enormous demand by U.S. travel agencies, so much so that we brought forward to the beginning of September the launch of the new website lowcostbeds.us, exclusive to the United States, promising a more positive future for the company in the short term”, comments Leunen. Nevertheless, she recognises that the situation in Spain: “is complicated, with clients seeking short stays at the cheapest rate. They want to
break the traditional Tour Operator model to better adapt offer to demand. This is why Lowcostbeds is operating so well in the market, as we offer a low cost product that adapts to these needs with over 5,000 contracts negotiated directly with hoteliers to guarantee the best market price and we work with over 250,000 hotels around the world”. SLOW GROWTH. The company looks to the future with optimism, convinced that they are on the right track. Elodie Luenen confirms that future prospects
are positive but growth will be slow. “The tourism industry is the first to be affected in a crisis for it is one of the first cuts made by the population, but it is also one of the first to make a rapid recovery”, she comments. Moreover, thanks to the market’s positive reaction to the product “prospects for the future are heartening” to such a point that in the medium term the Low Cost Travel Group plans to continue expansion in Europe and globally, opening in new markets such as Denmark, Finland, South America
and Australia, among others. In fact, Leunen is convinced that the marketing of beds will continue along this route: “sales will grow considerably over the next months. We are already working on the preparation of our 'Summer 2013' product with new exclusive contracts, better prices and competitive rates. We have a dynamic team with contracting managers in each destination in permanent contact with the large hotel chains and the small hoteliers to ensure that our product adapts to the changes in current market tendencies and consumer demand”.
IN DANGER. In her opinion, all the above implies that the traditional sales model is in danger and that: “more than a consideration, it is in fact a reality that we are experiencing. More than ever, Spaniards are seeking flexibility and cheaper prices. Tendencies have altered and the client no longer looks for the 7 night organized package including organised flights, hotels and transfers. The client wants to adapt the offer to his needs and continue travelling but saving as much as possible. The first thing a customer does is to search among the low cost companies for the destinations he is interested in and locate the cheapest rates. He then complements the journey with hotels and low cost transfers to create his own cheaper holiday package; this method allows savings of up to 200 Euros compared a person making the same journey through a traditional tour operator. This is why low cost operators are growing, and Lowcostbeds allows agencies to offer the product that clients are seeking”. ■
November 2012 I WORLD TRAVEL MARKET I PREFERENTE I 29
High marks from the Industry for the Integrated Tourism Plan Unanimous applause for private sector investment but uncertainty regarding financing C. Hierro and G. Costigan
rincipal representatives of the Spanish tourism industry have welcomed the Integrated Tourism Plan approved last June by the Cabinet and presented to the public by the Minister for Industry, Energy and Tourism, José Manuel Soria. Local government Tourism agents, along with hotel associations and travel agencies, together with airline management -those who speak out the loudest about their needs-, have all applauded the bases of this Integrated Tou-rism Plan (PNIT). Perhaps the most popular feature of this Plan is that it was drawn up with the collaboration of all sectors of the tourism industry. In this case, differentiating it from prior Plans, those most active in contributing ideas were the people who most influence Spanish tourism, rather than the lobbies with a level of representation leaving much to doubt and consisting of individuals wishing to ingratiate themselves with the political authorities. The principal contributors to the PNIT have been the large hotel chains, the Presidents of the most respected Associations –CEHAT and CEAV-, and local Tourism Councillors, that is to say, the Industry heavyweights. The most evident and applauded instances of this public-private collaboration is that of Turespaña, where a council of experts elected personally by the Secretary of State for Tourism, Isabel Borrego, will lay down the guidelines of the promotional Goverment body. “The most important thing of all is the possibility of private bodies to form part of Turespaña because public-private collaboration is fundamental. Only good things can come from this plan” predicts the President of the hotel association, Joan Molas. Maximum authorities of the Canary and Balearic governments
agree. Ricardo Fernández de la Puente, Deputy Tourism Councillor for the Canaries, assures Preferente that “we have actively participated in drawing up this Plan, contributing to the document”, while Carlos Delgado, Tourism Councillor for the Balearics, also “values positively” the increased collaboration between private and public sectors. AUTONOMIES. But it is precisely the regional issue that comes to the fore immediately with industry leaders consulted by this magazine, although there is also general celebration that finally a step is being made towards a single hotel classification across the entire country, as Preferente published in its May edition. For Molas, one aspect that should have been insisted upon much more is that of “the coordination of Central Government with Regional Governments. Work will be done on homogeni-zing regulations but in the question of local government promotions Turespaña is seen as an enemy. A joint promotion must be made under the umbrella brand Spain to be more competitive because coordinating independent campaigns is very difficult”. Fernández de la Puente speaks of “our principal demands: a plan to renovate the mature resorts including financial aid from central Government, the joint management of airports, so necessary for the Canaries, and which would enable us to apply aggressive commercial policies to increase the number of flights and thus generate more profit, and also the legislation on coastlines”. For Delgado, “approval of said plan implies greater collaboration between the local regional governments on tourism issues, strengthens the trademark Spain, increases public-private collaboration and drives tourism and its promotion both in traditional markets and in new target markets”.
30 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
For his part, Álvaro Middelmann, Managing Director of Air Berlin for Spain and Portugal, states that “the most important thing is that Spain as a whole is spoken of, for this recognises the value of the brandmark Spain and is important because one must work hard to achieve a homogenous legislation. The PNIT hotel classification is also interesting, as is the drive for public-private collaboration which is an important element”. “It is too soon to evaluate whether some aspects can be improved upon. The PNIT must be studied in depth and seen to work. In relation to insularity, until now this has never been considered, and its importance never recognised, and we do not have any specific weight in Parliaments”, the airline chief added. FINANCING. Molas states that “the only problem I see in this plan is a lack of finance. It is an ambitious plan but there is no money. I give the plan an excellent mark if it can be put into place but I insist that money is lacking and more is required”, states the hotelier. In reference to the budget assigned to the PNIT, Middelmann sustains that “it is many millions, and it has yet to be seen how they are used. Creativity is fundamental”. For de la Puente, his concern is
knowing if the budget assigned to the Plan represents additional funds to the original budget set aside for Tourism. It must be remembered that the Government promised its commitment to some 450 million euros per year for this Plan up to 2016, which is the same amount that now figures on the budget for state Tourism. VISAS. The President of CEHAT mentions that this plan is closely related to the advance issued by the previous Government of its Plan 20-20 and includes a number of concrete issues that had already been discussed and designed. The most relevant issue to underline is one concerning visas. Great advances have been made, along with support to tourist municipalities and above all the possibility of private companies forming part of Turespaña because a public-private collaboration is fundamental. Only good things can come from this plan”. In relation to speeding up the visa process, Gallego mentioned that this could have been taken further “eliminating their need in countries such as Russia” as it is basic for many markets like this. The President of the Travel Agents is in favour of many of the points mentioned in this ‘programme’, such as promotion. ■
The Canary Islands, a destination still strong in winter Tenerife and Fuerteventura confirm the good predictions M. L. G.
n the Canary Islands summer ended with more than acceptable figures, even better than those first forecast, although it must be said that not all the islands have shown an equal tendency for while Tenerife achieved its figures, Las Palmas experienced a substancial drop in national tourism. However, this does not affect the optimistic forecasts for winter, as revealed by the first numbers released on hotel winter bookings. In reference to the summer season figures, both Jorge Marichal, President of Ashotel (Association encompassing hoteliers from Tenerife, La Palma, La Gomera and El Hierro) and Fernando Fraile, President of FEHT (Federation of Hotels and Tourism in Las Palmas which encompasses the islands of Fuerteventura, Gran Canaria and Lanzarote) consider that the figures show a tendency that falls within “foreseen limits”. And while Marichal underlines the fact that figures reveal a considerable drop in British and Spanish tourists, the former due to the
Olympics, and the latter due to the crisis, the German market “remains stable”. Fraile mentions the considerable drop in national tourism to Las Palmas. “We are worried about the national market and very attentive to how the British market evolves, for we are aware that the excellent results in 2010, the best year ever, were due to the Arab spring, but the truth is that the drop since then has not been drastic which can only be seen as good news” stated Marichel and Fraile agrees with this.
the words of Ricardo Fernández de la Puente, Deputy Director of Tourism in the local Government, who stated that national tourism is weak due to the financial recession hitting Spain and causing the drop in tourists predicted by both local government, hoteliers, and operators. However, both the Deputy Director and the Presidents of both Associations underlined the “positive” tendency in a number of important markets for the Canaries, as is the case of Germany whose sales have increased 7% over summer 2011.
Tourism trend during the summer has been as expected
DIFFICULT TO COMPENSATE. The FEHT President states that it is “very difficult to compensate for the loss of national tourists not only over the summer but throughout the entire year”, although he admits that the drop is slight and falls into what was forecast. “The tendency, he claims, is to continue seeing a fall in the Spanish market”. In line with these statements are
32 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
TENERIFE. The second Vice-President and Tourism Councillor for the Tenerife Government, Carlos Alonso, indicated that figures showed that the summer season has been ‘practically the same’ as last year because despite the drop in national tourism, the British increased and the German remained unaltered. In any case, everyone agrees that the figures are not definitive and the final percentages will not be known until the end of October, when a final assessment can be made. Both Marichal and Fraile insisted upon the fidelity of the Germans both in summer and winter, and likewise with the British who, while having registered a negative evolution, had good last minute sales, and figures may well equal those of last year. As Marichal emphasised, the month of August “was a strange one, with high occupancies due to last minute offers. Looking at winter, it appears to be faring well as figures so far look positive with good sales in Norway, Holland and
Britain, while in Germany they remain unaltered.” Fraile is a little less optimistic and says that the tendency is to continue losing tourist numbers. He hopes the winter season will go well but “we cannot better last year’s figures, and indicators are that it will be a little worse, although our main concern is to not see over a 1% drop in numbers”. This is the current situation. The Las Palmas Hotel Federation is working with other markets that offer better possibilities, such as the Russian, French or Italian, in particular the former, which is “giving results”. FUERTEVENTURA. In regard to promotion, the Fuerteventura Tourism Board continues working closely with the British market by way of a number of joint marketing agreements and sporadic promotional campaigns with tour operators and airlines. One such promotion is with Monarch airlines who in recent months has promoted Fuerteventura and achieved almost 750,000 direct clients. As their directors stated, the general drop in the British market during “summer justifies every possible promotional effort to reverse this tendency”. In any case, one thing is certain: the Canaries await their high season with optimism while insisting, as stated by Marichel, that "the problems arisen due to the earthquake in El Hierro and the fire in Gomera are now behind us, because the razed area on the island was 7% and of this, 5% corresponds to National Parkland, meaning that 95% of the island remains to be enjoyed. Of the 46 walking routes, only 4 or 5 are visually affected, so we can say that the island's appeal remains unaltered”. ■
Cruises emerge as the core of tourism holdings Large agency networks see their mid-term future linked to the incorporation of a cruise company Monica Libre
he current formula used by large travel groups appears to have its days numbered, at least in Spain. Along with the problems of Globalia and Orizonia in generating any profit due to the decline of consumers in Spain, new tourism groups are beginning to arise with the common link of a shipping line, which provides a financial core and requires a retail network to market the product. There are two projects of this kind currently in the making, whose success will represent a definite restructuring of travel distribution in Spain. Both cases are projects that expect
mid-term results, although they will make an appearance very shortly. Their mentors are convinced that today’s large tourism conglomerates have a great future in upholding their present structures. The growth of cruise products for agencies requires an understanding by both parties. The consumer chooses the retailer for the purchase of his first cruise, while for the second and subsequent cruises feels confident enough to purchase online. Therefore, shipping companies battle for a preference in both areas: physically in agencies and also on the Internet, be it by means of OTA or by means of the company’s own website.
The latter is precisely the most polemic issue. Industry experts agree that direct sale is unstoppable, although in the short term expectations are that it will continue to be less than ten percent of overall sales. But in the mid and long term, prospects are different once the repeat client base has grown.Agencies have been niggled by this for a year already and the tour operators must be worried about the same thing. As currently occurs with large groups, with each large retailer tending to promote its own company’s wholesaler, it can be seen that the sale of cruise holidays will be divided out in the same way. That is, Pullmantur and Royal Caribbean will continue to channel sales to Nautalia and Carnival and its partner Costa Cruceros will do likewise with the network it finally purchases, which will have a domino effect in the sector. Cruise companies that remain without any direct link to a large wholesale brand will have, in principle, greater sympathy with independent agencies and greater possibility of striking preferential agreements with operating groups. However they cannot ignore the pressure of direct sales and must eventually consider greater investment to re-launch sales on their own websites. MODEL. One thing upon which everyone agrees among the experts consulted by this magazine, is that the current configuration of large groups requires a considerable change. Hotel
chains, receptive agents, airlines, tour operators and retailers are all valid, but profit is scarce considering the current volume of the two main tourism groups in the country. Each division has its own problems and uncertainty, affecting eventual profit in the other areas. In the case of Globalia, the hotel division has been a bone they had to swallow. Their airline, in spite of its good brand image in Spain, is still exposed to market fluctuations in oil pri-
ces, and the tariffs dictated by Aena, along with pilot strikes, and without forgetting exceptional circumstances due to climate conditions. Hotels and airlines, because of their smaller volume, are not the greatest concern of Globalia's competitor, Orizonia, whose business is more heavily concentrated on tour operation, a market with more offer than demand and one that faces a change in model not yet put into effect, since the onset of the Internet. In recent years, both groups have tended to increase clientele but produce less profit. This means that in order to continue competing in price they have had to sacrifice their profit margins. Therefore, faced with the slightest hitch, they lose money. CRUISES. The exceptional economic circumstance in recent months have also had an effect on cruise sales, resulting in a larger than ever last minute pick-up. The Concordia accident also influenced this, as the key two-week campaign had to be cancelled due to the accident. Recent years have seen the shipping lines make enormous profit compared to other tour companies, excluding the large holiday hotel groups. This means that cruise lines emerge as the product that still has growing space to allow a reduction in margins and offer a greater ability to swallow small losses from its retail partners. This is especially the case if the mother company is one of the world’s two largest shipping lines. ■
34 I PREFERENTE I WORLD TRAVEL MARKET I November 2012
Published on Nov 6, 2012