T H E B U S I N E S S O F VAC AT I O N Q 3/Q 4 2 0 1 7
LOYA LT Y: T H E SW E E T S P OT
CHOOSE CHINA By the numbers itâ€™s out of this world
MEXICAN MAGIC Benefits of the vacation club model
QUALITY IN SPAIN Resorts get multi-million euro makeover
ENGAGE & INSPIRE YOUR BUYERS
DAYS OF VACATION Per Year?
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AVERAGE COST Per Night?
HOW MANY YEARS Will you vacation for?
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TOTAL SPEND with inflation added
VIDEO BROCHURES PACKAGE YOUR PRODUCT WITH THE
TAKE YOUR SALES PITCH INTO THE
LATEST VIDEO TECHNOLOGY
HOMES OF YOUR BUYERS
Video Brochures embed a high-quality video of your choice into a traditional printed brochure, to help your buyers to visualise ownership.
Use the next generation in sales engagement to communicate directly with your customers, by sharing videos, graphics and images.
To learn how Video Brochures and RCI LiveStream can address your marketing needs and enhance your communication with clients, contact your RCI Affiliate Services Manager
Welcome RCI Affiliates
IN BRIEF 4 News The latest news from Europe and around the world IN DEPTH 8 Quality Counts Millions of euros are being invested in Spanish resort refurbishments 12 Loyalty: Hit the Sweet Spot Pestana Vacation Club’s product bundling strengthens customer loyalty IN DEVELOPMENT 18 Better Together Peer-to-peer collaboration boosts business at Brockwood Hall Lodges in the UK INSIGHT 21 Profile: Stephen Carter, OBE A look at the career of one of the most accomplished members of the leisure and hospitality sector 24 Choose China A big country, big numbers and lots of opportunity – the facts about China’s hospitality industry 30 Leveraging the Luxury Lifestyle The next level of membership experience in Latin America FINAL THOUGHT 34 Spotlight on Russia Absolute World’s Vladimir Sucevan reviews the business landscape in Russia
When we stop to think about what makes the biggest positive difference in our lives, both personal and professional, it comes down to people. Whether it’s the people you go on holiday with or those sitting across the boardroom table from you, the people you connect with matter the most. People are the focus of this issue, with many of the articles demonstrating the importance of making the best connections for the prosperity of your business. Our cover feature on page 12 looks at the life blood of any business – customer relationships. Pestana Vacation Club has established a network of local alliance partner businesses to enable it to offer discounted experiences to its owners and guests, which has been key in building a successful world-class customer loyalty programme. Building a loyal customer base using highly effective collaboration with local tourism operators to offer a menu of authentic experiences has long been the trademark of our LATAM affiliates – see page 30 for the secrets of their success. RCI, working with one of the world’s most diverse hospitality groups, Wyndham Worldwide, helps its existing and new affiliates to unlock business opportunities. UK resort, Brockwood Hall Lodges, shares how it has boosted its occupancy, particularly in the low-season months, by working with RCI sister company, Hoseasons, and is planning to build more properties to put into this programme. Turn to page 18 to learn more. One country that the world’s major economies are turning to in the hope of establishing a fruitful collaboration is China, and on page 24 we talk to several leading players in China’s hospitality sector to discover what opportunity lies there for our industry. We hope to provide you with much food for thought and inspiration in your RCI business magazine. Enjoy your read.
Vice President, Business Development RCI Europe, Middle East and Africa
Visit rciventures.com for news of the worldwide shared vacation ownership industry and insight from the experts.
is published by RCI, a trading name of RCI Europe, Kettering Parkway, Kettering, Northants, NN15 6EY, United Kingdom. Tel: +44 (0)1536 314266. Email: email@example.com EDITOR: Helen Foster. ASSISTANT EDITOR: Leigh Connelly CONTRIBUTING EDITOR: Steve Adams. DESIGN: Charlotte Semark, Ginny Knight, Charlie Hayes. PRODUCTION: Claire Williams, Helen Gurney, Trevor Lewis, Leigh Connelly. PRINTING: Portland Print. PHOTO CREDITS: Shutterstock, iStock. ILLUSTRATIONS: Cover and pages 12-17 - Charlotte Semark. Original articles and contributions may be reproduced or transmitted only with written permission from the publisher. All facts and figures stated in the articles contained in this publication are provided by the contributors and no responsibility is accepted by RCI Europe for content not created by them, nor for any losses or other consequences resulting from advertisements or other material appearing in this publication. You are advised to make your own enquiries and conduct further research if necessary. © RCI Europe 2017
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Holiday Club adds luxury suites in Turku
Holiday Club Caribia in Turku.
Leading European timeshare operator and long-term RCI affiliate, Holiday Club Resorts, has opened a selection of luxurious villa suites at its resort in the Finnish city of Turku. The 58 new Holiday Club Villas at Holiday Club Caribia will offer highquality, spacious accommodation and are part of a large-scale renovation at the resort. The completion of the suite-level flats is part of a major renovation project at Spa Hotel Caribia that began in 2016. In addition to construction of the new Villa suites and renovation of the spa and hotel, the €16.5 million project includes the updating of the resort’s 145 hotel rooms, plus the addition of 13 new timeshare units, two new restaurants
and the opening of the SuperPark activity park. Tapio Anttila, Holiday Club’s Villas and Rental Business Director, said the Villa suites would offer a luxurious new option for holidaymakers visiting the area. “The Villas will introduce a much-anticipated addition to the accommodation offering of the city of Turku. We strongly believe Caribia will be the top pick of those seeking high-quality accommodation in the Turku region,” he said. “The spacious new flats with highquality furnishings, in a destination such as Turku, will suit the needs of year-round vacationers, as well as customers wanting to stay for longer periods.”
Google expert joins Hapimag Switzerland-based holiday company, Hapimag, has appointed Philipp Ries, Industry Travel Leader at Google Switzerland AG, to its Board of Directors. The move reflects a greater emphasis on new media and reaffirms the company’s focus on online marketing and communications that has been pursued by CEO, Philipp Ries, Hassan Kadbi, since his appointment in November 2016. Hapimag. Speaking at its annual general meeting, Dr Giatgen Peder Fontana, President of Hapimag’s Board of Directors, said he was delighted with Ries’ election, explaining that new media played a decisive role in the holiday market, and in attracting Millennials in particular. 4 Q 3/Q 4 2 01 7
Russian language servicing from RCI In response to the increasing importance of the Russian timeshare market, RCI is providing customer servicing to its Russian members in their own language. The move acknowledges Russia’s huge potential as both a source and destination market for timeshare and, therefore, the importance of supporting potential buyers and owners in their native language. Russians have been buying timeshare overseas for many years. The country’s timeshare industry is growing, and its domestic tourism market booming. More than 20 million foreign tourists visited the country in 2015, eight per cent up on the previous year; and it is anticipated Russians will start buying vacation-exchange properties at home in larger numbers to facilitate their travel aspirations. Dimitris Manikis, Vice President of Business Development for RCI Europe, Middle East and Africa, said: “The lack of a legal framework has hindered the shared-ownership market in the past, which is why now, with the growing potential in this market, RCI has been working with key local and international stakeholders in forming a trade association. At the same time we felt it was important to support timeshare owners, and potential owners, by providing member servicing in the national language.” Olga Zguna, RCI’s Russian Sales Holiday No matter what Consultant, said speaking the outcome or to Russian timeshare nature of the owners in their native issue at hand, tongue was crucial to they will gladly developing the industry and confidently in the country. She continue to be a said Russian language valued member servicing had already of the RCI and been appreciated by timeshare family. RCI members who had transacted with RCI, particularly those of an older generation with limited language skills. “It’s much easier to speak with specialists in your own language, sharing the same mind set, and who are aware of the country’s own travel and visa requirements, and can give a detailed answer to all questions,” she explained. “Our Russian members are very happy to be able to discuss all their needs and questions in Russian, they place real value in that. It gives them a feeling of receiving a high-quality service whenever they deal with RCI and the industry. “When a member has a pleasant experience over the phone, no matter what the outcome or nature of the issue at hand, they will gladly and confidently continue to be a valued member of the RCI and timeshare family, which is good for business.”
Jackson named COO at Macdonald group
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Jobs supported by global timeshare industry
$20 bn Global sales of timeshare in 2015, 11.5% up on 2014
5,400 Timeshare resorts around the world
527,000 Timeshare units across 121 countries
Global shared-vacation ownership occupancy rate
Wyndham opens two hotels in Greece Wyndham Hotel Group and hotel development consultants Zeus International have opened two new hotels in the Greek seaside town of Loutraki. The 107-suite Wyndham Loutraki Poseidon and the 196room (and bungalows) Ramada Loutraki Poseidon Resort follow on the opening of Wyndham Grand Athens, which marked the groups’ first joint venture. The Wyndham Loutraki Poseidon. two groups have also announced a strategic development Dan Ruff, Wyndham Hotel Group’s agreement with plans to develop 20 hotels President and Managing Director, across Greece, Cyprus, Bulgaria and Romania EMEA said: “Wyndham Hotel Group has ambitious development plans for Greece, during the next 10 years. Haris Siganos, CEO and Founder of and in Zeus International we have found Zeus International, said: “Following the a remarkable partner with whom the successful launch of Wyndham Grand expansion of our presence in Greece will Athens, we are pleased to further extend become a reality. We want to ensure that our co-operation to Greece with the travellers to any destination, whether in venture in Loutraki, a city known for its Greece or the rest of the world, can always find our quality service nearby.” natural beauty and its healing springs.”
Turkish Ramada resort joins RCI Ramada Resort Akbük, a contemporary all-inclusive resort overlooking Akbük Bay in western Turkey Besim Sulan, Akbük Resort has joined the RCI Group. exchange network. Around 50 of the resort’s hotel rooms and one-bedroom units are being affiliated into the RCI exchange network. Besim Sulan, Manager of developers, Akbük Resort Group, said: “One of our aims in using the exchange model is to diversify vacation opportunities. We chose RCI as a partner to encourage new guests and to give our loyal guests the opportunity to take holidays in different countries. We also hope that working with RCI will help to increase our worldwide recognition, help develop our potential and carry our service quality forward.” Ali Egilmez, RCI’s Affiliate Manager in Turkey, said the affiliation reflected the wide range of opportunities and solutions that RCI, working with Wyndham Worldwide, can offer. He said: “We are the only tourism and accommodation company that can provide a holistic solution and opportunity to developers. We didn’t just provide Ramada branding, but demonstrated how a developer can use inventory on different platforms, such as selling timeshare, to create a loyal member base. “The synergy between Wyndham Hotel Group and RCI can provide great opportunities for mixed-used properties. Developers see the value of this, especially during turbulent times for the tourism sector.” Ramada Resort, Turkey.
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Simon Jackson has been appointed Chief Operating Officer of leading independent UK hotel group Macdonald Hotels & Resorts. Jackson has worked for the group for 14 years in a variety of senior Simon Jackson, Macdonald management roles, most recently Hotels & Resorts. as Chief Executive of Macdonald Resorts, which incorporates its timeshare arm with ten resorts in the UK, Spain and Portugal, all of which are affiliated to RCI. He told RCI Ventures he was honoured to have been part of the Group’s success story for 14 years. He said: “I have been fortunate to work alongside, and learn from, some of the finest people in the hospitality industry during that time, and I am truly grateful for that opportunity.” Jackson identified the priorities of his new role, saying: “My key focus will continue to be improving the customer journey for our guests and improving the quality of our product for every new arrival, all while ensuring our own 4,000-plus employees are developed, trained and provided with the many career opportunities that exist within our company to fulfil their own career goals. It is a very exciting time for our company and one I am looking forward to supporting for many more years into the future.” In a separate development, the hotel group has recruited Chris Cooper as Group Business Development Director and Lyn MacDonald as Marketing Director.
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RCI agrees deals to acquire DAE and Love Home Swap RCI has reached an agreement with vacation group Beneficium to acquire Australia-based DAE Global Pty Ltd (DAE), operator of timeshare exchange company Dial An Exchange and software business @Work International. The deal, subject to customary conditions and receipt of applicable regulatory approval will see DAE’s offices in Australia, New Zealand, US and Egypt become part of RCI. This follows the exchange company’s recent acquisition of London-based Love Home Swap, one of the world’s largest home exchange programmes. The addition of both companies will complement RCI’s existing business, broaden its appeal to a new base of travellers and strengthen its position as a leader within the global alternative holiday accommodation sector. The acquisition of @Work International, which develops exchange management and reservation management software programmes, will allow RCI to bolster the technology solutions it can offer its affiliated resort partners and its affiliated resorts’ owners’ committees. RCI’s President, Gordon Gurnik, said: “Since first pioneering the vacation exchange concept more than 40 years ago, RCI has continually found new ways to evolve and grow its own business while also propelling the exchange industry forward.
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“Through these acquisitions we expand the exchange options we offer travellers and strengthen our footprint in key growth markets across the globe.” We’re As part of the RCI delighted to family of brands, DAE join the RCI will benefit from a range family and of core competencies, are excited including inventory to work management, member closely with marketing and analytics. It will also enjoy the them to added resources that help shape come with being part the future of the travel of a global hospitality leader. Love Home industry Swap will also enjoy a together. range of benefits. Both companies will continue to be run as independent brands and be marketed separately. However, the similarities among these exchange-oriented businesses will allow for greater collaboration between the companies to foster growth and provide future travel benefits to their respective members. For Love Home Swap, Debbie Wosskow, the company’s Founder, will remain on as an advisor to ensure a smooth transition into the RCI family, while Ben Wosskow, formerly Chief Commercial Officer, has been named Managing Director and will oversee the daily operations of the business. “Dedication and hard work has yielded fantastic results in a short space of time and this is a real global success story for the UK sharing economy,” said Debbie Wosskow. “We’re delighted to join the RCI family and are excited to work closely with them to help shape the future of the travel industry together.” DAE will continue to be led by Co-founder Francis Taylor as Managing Director, while Peter Vanderhorst will continue to serve as Managing Director of @Work International. “This will provide DAE with the resources it needs to fulfill its ultimate potential,” said Taylor. “It’s a great opportunity for the company and its dedicated staff around the world.”
Ali‘i Kai Resort joins The Registry Collection
Ali'i Kai Resort.
Ali‘i Kai Resort on the Hawaiian island of Kauai is the latest property to join RCI’s luxury exchange programme The Registry Collection. The RCI Gold Crown resort has been part of the company’s exchange network for more than 25 years and is now also a part of The Registry Collection programme through affiliation to its Signature Selections collection. Ronald Wright, Developer and President of Ali‘i Kai Home Owners' Association, said: “Having our property included in The Registry Collection programme’s exclusive exchange network is a proud moment for all of us. “A stay at our property is truly exceptional, and we are looking forward to welcoming members of The Registry Collection to experience it firsthand, as well as inviting our owners to experience the benefits of being part of this exchange programme.” Situated on the scenic north shore of Kauai, the property sits atop a bluff overlooking the Pacific Ocean. Its 18 luxurious two-bedroom units, which recently underwent an extensive renovation project, provide lavish bedrooms, living rooms and dining spaces, all equipped with high-end amenities. Each condo includes a balcony from which guests can enjoy views of the island. Gregg Anderson, Global Vice President of The Registry Collection programme, said: “Ali‘i Kai Resort is an excellent fit for our luxury portfolio, and I’m confident our members will appreciate a new travel option in Hawaii. “Resorts on Kauai provide amazing experiences, and Ali‘i Kai Resort is one of the best on the island. We are thrilled to add it to our exchange network.”
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Wyndham Boston Beacon Hill 47.
Wyndham Worldwide to become two publicly traded companies Wyndham Worldwide has announced plans to spin off the company’s hotel business to create two separate, publicly traded companies. Wyndham Hotel Group, with US headquarters in ParsipThe pany, New Jersey, combination will become a new, of Wyndham publicly traded pure-play hotel Vacation company with a Ownership portfolio of rewith RCI nowned brands. is the best Wyndham Vastructure cation Ownership, to unlock with headquarters shareholder in Orlando, Florida, value and will be the world’s enable strong largest publicly growth traded timeshare across the company, and will now be joined with businesses.
Wyndham Destination Network, home to RCI. The company will also explore strategic alternatives for its European rental brands. The two public companies intend to enter into long-term exclusive license agreements to retain their affiliation with the Wyndham Rewards loyalty programme, as well as continued collaboration on key inventory sharing and customer cross-sell initiatives. The corporate names of the post-spin public companies have not yet been decided. The transaction is expected to increase the strategic flexibility of the two postspin companies. It will allow each to maintain a sharper focus on its core business and growth opportunities, facilitate future capital raising as required, and position each to be better able to make changes to respond to developments in its markets.
Stephen Holmes will serve as Non-Executive Chairman of the Board of Directors for both companies. Geoff Ballotti, current CEO of Wyndham Hotel Group, will continue to lead the hotel company as President and CEO. Michael Brown, current CEO of Wyndham Vacation Ownership, will continue to lead the timeshare company as President and CEO. Holmes commented: “After a comprehensive review process, the Board of Directors has determined that a spin-off of the hotel business and the combination of Wyndham Vacation Ownership with RCI is the best structure to unlock shareholder value and enable strong growth across the businesses. “We will work with the leadership of our European rental organisations, which have outstanding brands in their regional markets, to explore options to fully realise their future growth potential.” R CI VENT U RES 7
Investment in quality is fundamental for any industry: for the hospitality market, it’s imperative to get guests through the door. REBECCA GORMLEY investigates how some long-standing sharedownership resorts manage investments to deliver on owner and guest expectations, year after year.
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RACHEL LITTLEWORTH Resort Manager, Club Las Calas.
IN AN AGE WHERE THE HOSPITALITY industry is fascinated with creating unique products and authentic experiences, the market is moving at an incredible rate. Coupled with the constant development of new technologies, including digital self check in, Artificial Intelligence (AI) and virtual reality, competition in the industry is becoming stiffer and stiffer. The volume of investment, however, is not the key driving factor of a successful hotel or resort – it’s the meticulous planning behind it. Images, videos and reviews are being shared en masse every few seconds, and with 70 per cent of travellers reading up to 20 reviews when planning a holiday, it is essential that hospitality players of any size invest in regular quality upgrades to ensure their properties stay in line with guest and owner expectations. The web brings a stark transparency to your offering and bad reviews being out there will damage the brand and impact revenue. The shared-ownership industry has a strong reputation for successfully managing investment to enhance and improve resort amenities and accommodation. Many resorts which were established at the inception of timeshare are still at the height of their game today, and some of the resorts decorating the Spanish coasts are a prime example of this.
Left: Club Las Calas' refurbished pool area. Below: Crown Resorts at Club Marbella Sapphire Collection apartment.
“We deliberately don’t position ourselves as a top notch, five-star resort,” said Cubley, “as we know and understand our audience. Our owners and guests choose Crown Resorts because we are comfortable, inviting, and they know that they will get the holiday experience they are looking for when they stay at any Crown Resort property. “The Sapphire Collection at Club Marbella, Crown’s first established resort, is an upgrade product for our owners, and resort guests pay a supplement fee to access these apartments. Not only is this advantageous for customers, Sapphire Collection apartments are an additional channel of revenue from the rental offerings, which will help to enable us to continue with astute investment in resort refurbishments in the coming years. We now have a show apartment – an ideal opportunity for rental agents to experience the product first-hand, and for any owners and guests currently staying at the resort, who may be considering staying in a Sapphire Collection apartment in the future. Our owners stay in these apartments at no additional cost. “In addition to this, investment in the communal areas was key, and our ‘Kids Mini Club at Club Calahonda’ has also benefitted. Work is underway at Club Calahonda to improve its 82 apartments, with the installation of airconditioning and new patio doors, as part of the second of our three-phase refurbishment programme.” Refurbishment fundamentals As for many resorts in the European market, the rental avenue has been integral to business growth and maximising opportunities for Crown Resorts, while also contributing towards operational costs. However, the buy in and support from owners and guests was also essential in making the refurbishment programme a possibility.
A FRESH SPIN:
Crowning quality Crown Resorts has a portfolio of four individual resorts, located on the stunning Costa del Sol: Club Marbella, Club Delta Mar, Club Calahonda and Club La Riviera. In 2014, Crown Resorts celebrated its 25th anniversary of RCI affiliation, with all its resorts retaining RCI Silver Crown status as a result of Crown’s dedication to striving for quality. Tim Cubley, Resort Manager, Crown Resorts, told RCI Ventures that the crucial ingredient to maintaining excellent resorts was prudent financial planning. “In 2016 we seized an opportunity to increase revenue, without any financial impact to our owners, in order to make some radical enhancements to our resorts”, he explained. “We sold Club Caronte to the open market, and consolidated our portfolio of five resorts to four. “It’s essential that our owners and guests are at the forefront of our minds when making any decision, as their support is integral to the operation of the resort. Our Club Caronte owners were successfully transitioned to the other resorts, and we are seeing a positive response.” As a result of Crown’s decision to sell Club Caronte, and its prudent financial planning, an incredible €2 million was invested in extensive refurbishment programmes across its other resorts. And out of that initiative, an upmarket new brand for Crown was born – The Sapphire Collection. A total of 43 new apartments have been launched, following a vast renovation programme and apartment reconfigurations at Club Marbella. Sapphire Collection apartments offer a premium experience for owners and guests, with the aesthetics designed by an interior design specialist, providing an immaculate space for owners and guests to truly relax in while enjoying their vacation.
Q UA L I T Y I N T H E S P OT L I G H T Refurbishments are certainly a hot topic across the Spanish region, with many resorts investing in quality. Here are just some examples of recent, major resort upgrades. Apartamentos Tropical Park is carrying out a €6 million refurbishment programme of the units and communal areas.
Pearly Grey Ocean Club has renovated the seafront units to a high standard, integrating the latest technology and offering stunning interiors. Vigilia Park anticipates completion of its refurbishment programme by close of 2017, with the restaurant, mini-golf area, solarium and 20 units being renovated. ONA Club Bena Vista has completed an entire refurbishment to the interiors of each of its units. In addition to this, further refurbishments have been carried out at ONA Club Novelty; ONA Aucanada; Apartamentos Fenix Beach; Habitat Playa Romana; Holiday Club Sol Amadores; Club Marina and La Pinta Beach Club. Club Marbella terrace.
Cubley said: “The Owners' Committee is entirely transparent with its membership. It’s imperative that we are. They want to maintain the high standards and the quality of the resorts to protect the viability as a holiday product. We held considerable debates, shared the initial plans as early as possible, and communicated with our owners six months ahead of the work commencing. “Asking for feedback is crucial. We are a memberfocussed club, and everyone, from staff to our newest family of owners, has valuable involvement in the future of their resorts. Recently a member of our resort maintenance team saw an opportunity to transform some unused space into a mini-golf course – so that is precisely what we did.”
to our guests as possible. “Ahead of this, we shared the very early conversations we were having with prospective specialised contractors with all our owners, and provided frequent updates to our owners.” The objective of the resort’s refurbishment programme was to maintain its status in Lanzarote and the other Canary Islands, as well as ensuring that it delivered on the changing expectations of loyal guests and owners, in addition to attracting the next generation of owners and guests. The newly renovated apartments at Club Las Calas feature:
Sustaining status Club Las Calas proudly presents itself as Lanzarote’s most popular timeshare resort and on 13 July 2017, the Club’s Chairman, Mike West, cut the ribbon on its upgraded apartments, to celebrate the completion of its €2 million refurbishment programme. Having retained its RCI Gold Crown status for 16 years, the management team at this resort are all about quality. For Resort Solutions, the management company for Club Las Calas, the clear and consistent communication to owners and guests was integral to implementing the incredibly successful refurbishment programme at Club Las Calas. Rachel Littleworth, Resort Manager at Club Las Calas, echoed Cubley’s views and shared how careful management and planning was essential to the successful renovation of the resort’s 145 apartments in just over two years. Littleworth explained: “Resort Solutions handled the intense logistics of blocking off apartments and reallocation of our inbound guests, in order for the work to be carried out with as little impact and inconvenience
• Rewiring for all apartments
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• A complete kitchen refit, including induction hobs, large fridge freezer, microwaves and silestone worktops • New high-quality bathrooms • Upgraded plumbing • New LED lighting • Fitted wardrobe interiors • Modern interior doors • En-suite shower rooms in the majority of the two-bedroom apartments. The communal areas, including the four swimming pools, have also received a facelift. Club Las Calas has been conscious to accommodate all of its guests, and has modified four further apartments, ensuring they are suitable for guests with disability requirements. “It’s fantastic to say that all of these refurbishments were made possible as a result of vigilant financial planning and were funded entirely from the resort’s sinking fund. This ensured that there was no need for our owners to dig deeper into their pockets for extra maintenance fee levies. “The end result has generated fantastic feedback from owners and guests. I think it is essential to understand
what your owners and guests are looking for out of their holidays and this has to encompass the whole holiday experience, not just the accommodation. “We’ve also seen a change in how our owners and guests choose to use the resort. Families are arriving with guest parties spanning all generations, from grandparents to small children, and we have a high demand for apartments with two bedrooms and two bathrooms – which is what we have delivered.”
Left: Club Marbella terrace. Below: Club Las Calas Restaurant.
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CREATING THE WOW FACTOR:
Partnering with RCI A common ground for both Club Las Calas and Crown Resorts is their longstanding affiliation to RCI – Club Las Calas, for example, has enjoyed RCI Gold Crown status for the last 16 consecutive years. “RCI can shed a fresh light from different eyes on the resort. The scores and feedback from the RCI Comment Cards, provided to each exchange guest on return from their stay with us, are invaluable to us because we need to meet owner/guest expectations, and this feedback comes directly – and regularly,” added Littleworth. Ovidio Zapico, Business Development Regional Director for south west Europe at RCI, believes that it is of the utmost importance for RCI affiliates to meet mutual client needs and provide them with excellent holiday experiences. Quality is a key piece of this process. Zapico added: “There is no doubt that client satisfaction is the link to future success and the best way to measure quality at our affiliated resorts is by using the feedback and comments we receive from our 3.8 million global members. In these competitive times, quality of guest areas, as well as service levels, is what distinguishes the industry from the likes of AirBnB and other selfcatering offerings. One of the ways we measure this is through our Comment Card programme, which benefits both our affiliates and our members, as it is fundamental
information for internal service standards.” Crown Resorts also sees great value in RCI involvement and support. Cubley added, “Crown owners are great advocates of the RCI exchange network, which means it is essential for the resorts to maintain their trading power values through quality. As long as we do this, our owners can continue to enjoy the same excellent exchange holidays that they did when they purchased their timeshare with us and were allocated trading power values. The RCI team has vast experience and a great deal of insight into the industry through working with a range of resorts, and it’s important that we can call upon them to offer advice on these major commercial decisions.” For resorts exploring the possibility of refurbishments, Crown Resorts and Club Las Calas were unanimous in their views as to how investment should be managed. Littleworth stated: “We know from experience with our owners and guests that while innovative gadgets can prove popular, the fundamental must haves are excellent Wi-Fi, a great animations programme for all the family, air-conditioning in every apartment, and a soft, comfortable bed to provide a great night’s sleep to help our guests to recharge their batteries.” Cubley added, “Competition is fierce in the Costa Del Sol, so of course, we must deliver on guest expectations, such as offering Wi-Fi and air-conditioning. What really sets us apart however, is the experience we offer guests through excellent customer service. “As soon as our timeshare owners enter the resort, the reception team greets them with a ‘welcome to your second home’. Our owners are passionate about the resort and have a vested interest in it, and quality isn’t only represented in the refurbishments we carry out, but is equally important in the service we offer our owners and guests.”
Loyalty: Hit the Sweet Spot Pestana Vacation Club shares how the imaginative bundling of your product into different tiers of appetisingly sweet packages can keep your customers coming back for more, and better. BY H E L E N F O S T E R
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SALES HIGH: The Madeira Beach Club.
Vice President, Pestana Group.
PAUL ROBERTS Sales Manager, Pestana Vacation Club.
FINDING ITSELF GOING BACK INTO SALES IN December last year, Pestana Vacation Club had to prepare itself, and its product, for a brave new world when the initial 30-year lease on its first timeshare resort, the Madeira Beach Club, expired. Pestana’s product review and redesign clearly worked because, in just under a year of being back in sales, the Madeira Beach Club is well on the way to hitting its projected 50 per cent sales completion by the end of this year. Occupancy of the 80 multi-million euro refurbished apartments began in July this year after an intensive six-month renovation. All change In 2010, Pestana Vacation Club was still selling a fixed-week product. So, what has changed in just seven years that has succeeded in setting this brand on the sales fast track? “We had to adapt the Pestana Vacation Club product to survive and thrive. Like many long-established sharedvacation ownership operators, everything about our offering was fixed; the weeks, the units, the season,” says Peter Booth, Vice President, Pestana Group. “One of the major changes is that today we are going into sales with complete flexibility on all of those things, even our check-in day, which is any day of the week now in order to allow our members and guests to take full advantage of the value air fares of the low-cost carriers.” And though important, that is just a small part of the reinvention of the Pestana Vacation Club product. The club’s product re-engineering and repackaging, which maximises the use of its diverse property portfolio assets, was many years in the making and today draws
customers, like bees around a honeypot, into an ever deeper engagement with the brand and the many experiences it offers. Paul Roberts, Sales Manager for Pestana Vacation Club, based in Funchal, Madeira, explains: “Quite simply I would say, demonstrate loyalty and you will receive loyalty. That has been the driving philosophy behind our product redesign to make it fit for today’s consumer and market.” Customer loyalty is an invaluable currency for any business, according to Roberts, who adds: “Year on year, the volume of business from our existing 25,000 active members continues to exceed expectations. This is a direct result of the level of satisfaction being experienced by those members. And it literally does start with an initial booking call or an email response…” There is a salutary reminder in Roberts’ words that no matter how clever you get with your product packaging, delivering a first-class customer service is absolutely fundamental in building brand loyalty. But how clever has Pestana Vacation Club been in gearing up for sales to the savvy customer of 2017 and the confident Millenials who know what they want and how to get it? Short-term ownerships of 10 years have proven to be a game changer. Pestana Options is a branded short-term ownership product which, having a reduced financial exposure, appeals to the Millennial buyer. It operates a ‘pay-as-you-use’ maintenance fee model with a daily charge for the stay from €40 to €60 a night, depending on the size of the unit. The figure is linked to the retail price index, is capped, and can and has dropped from time to time. Options members can buy credits to spend as they wish on Pestana Group bookings and services. R CI VEN T U RES 1 3
“Our members really do appreciate not being committed to an annual maintenance fee, and they like the fact the fee is linked to the size of the accommodation used,” says Roberts. Loyalty brings its own rewards Another significant change, and perhaps the most important in terms of creating a healthy sales pipeline, which reduces the barriers to initial purchase as well as drawing members into a more immersive brand experience and greater engagement, is the introduction of a multi-level loyalty programme based on the number of weeks owned. New buyers can start with an entry-level purchase into the least expensive membership tier to get a taste of the brand experience and, if they like what they see, it is an easy process to upgrade to the next level of membership. “Our Pestana Priority Guest, or PPG as it is branded, is our new tiered loyalty club product designed to give members the opportunity to upgrade, and so give us the ability to up-sell,” says Roberts. “Gold membership is based on a two-week ownership; Platinum membership is based on an ownership of between three and five weeks; and at the top, we have a Prestige membership in which members must own six weeks or more. It is a very successful and powerful tool for driving engagement with our brand. We find the owners do take advantage of the many different loyalty programme benefits, depending on either the number of weeks or the number of credits owned.” PPG gives its members discounts on services, fees, access to seasonal hotel offers, a pre-arrival concierge service, and discounted rental weeks, among many other benefits. Most valued are the room rate discounts, room upgrades, early and late check-ins, plus service discounts. 1 4 Q 3/Q 4 2 01 7
PPG members are credited with points based on a euro spend after each stay in a Pestana Vacation Club resort or Pestana Hotel, and as these are to be used towards future stays at Pestana Group properties, it encourages repeat visits by guests who are likely to return with family and friends, thereby working as a strong lead-generation programme. The Pestana Hotel Group’s bundled loyalty programme creates benefits also from its own asset portfolio - and with as many as 44 hotels across the world and 37 fabulous historic pousada properties in Portugal, that is an extensive range of assets. The Group has gone out to more than 60 restaurants, bars, retail outlets, excursions and other visitor activities close to its Portuguese resorts to secure discounts for its loyal members. Upon arrival, loyalty members are greeted by a welcome basket of fruit and wine, accompanied by a discount card for use at the associated off-resort outlets. Along with existing fixed-week members, Options Credit members are welcomed into the Group’s PPG loyalty programme. A recently introduced benefit which would tempt anyone into buying into such an initiative is the opportunity to gain discounts and offers on the Group’s latest lifestyle boutique brand, the CR7 hotels, which is a joint venture with one of the world’s leading
Operating an integrated, mixed-use hospitality product as we do works well with the loyalty programme. – PETER BOOTH
HAPPY & LOYAL:
Above left: Pestana Loyalty Party. Above: Quality time spent at Pestana resorts. Above right: Pestana Golfers.
Millennials, Cristiano Ronaldo. The first CR7 hotel opened this year in Madeira, birthplace of both Ronaldo, and group founder, Dionisio Pestana’s father. A second CR7 hotel opened in Lisbon last year and additional CR7 hotels will be opening in New York and Madrid. The same loyalty programme benefits are to be enjoyed in association with the country’s emblematic national treasures, the stately Pousadas de Portugal. Roberts is very clear on the importance of such a programme and why it works so well. He explains: “You have to remember that your members’ personal circumstances change over the years and that will have a bearing on their holiday needs, requirements and future outlook. With this very much in mind we are committed to the continual development of our products to meld with our members’ needs and to meet the demands of their changing expectations. This approach will most certainly enhance their membership at every life stage. Crucial in delivering on this promise has been our ability to be flexible on our term lengths, on unit and seasonal use, and considerate of what our members want from a fantastic holiday experience, whether they are Millennials or more mature members.” Booth adds: “Operating an integrated, mixed-use hospitality product as we do works well with the loyalty programme. People may start by staying in one of Pestana’s hotels, and from that stay they get a flavour of the Pestana service and experience; they start to return to other hotels, until they know exactly what to expect from the Pestana brand in terms of quality, service and experience. By the time they make a membership purchase decision, they know what they will be paying for.” More than the resort quality and amenities, Booth has seen the power of the club concept in building
loyalty. “People just love it,” he says. “Our members love the feeling of belonging - who doesn’t? So to belong to something really special like a club has a strong pull. We have noticed that our elderly members who don’t feel up to travelling and were thinking of getting out of timeshare ownership buy into the club concept. Their reaction to it highlights its value in creating a muchsought after camaraderie within the club environment. Friendships are forged that are followed up once they get back home. The club concept has proven to be a strong component in our product mix.” Mixing it up The Pestana Group’s product mix is far greater than many realise. It extends to real estate, the sales pipeline for which is fed by the Pestana Options and PPG programmes. “Hotels and resorts are our core business. Guests staying for a few nights or maybe a week do show an interest in spending more time in our community,” says Booth. “For those who want more, and to belong, we say ‘Why not consider the Pestana Options product and you can holiday with us for the next 10 years?’ This opens up a world of PPG experiences, and of course for the golfers, access to our six golf clubs and golfing resorts. From there we persuade them to move to a quartershare product of three months’ ownership. And from there, if they really like what we have to offer, we do have a freehold real estate product they can buy. We are building some new eco-friendly low-rise homes and bungalows on a beach front here in Portugal, one hour's drive from Lisbon. It is called Pestana Troia. “Around 70 per cent of freehold purchasers use these properties as holiday homes, visiting them for R CI VEN T U RES 1 5
up to three months a year; ten per cent are permanent residents who live there. We offer different rental platforms for owners to get an income return on any unused time in their freehold properties. RCI is a useful business associate to have because it brings the holiday exchange option to our offering and, through RCI, we have also come to work with some of its sister rental companies, such as James Villa Holidays.” It is easy to see, when you look at the varied lifestyle journey the Pestana guest, owner and member embarks upon, why this group has been so successful in locking in the loyalty of its customers, from a few nights’ stay in a hotel, to outright ownership. The little-by-little introduction to the many different lifestyle benefits to be enjoyed with the Pestana Vacation Club helps the member to slip into a deeper commitment to engagement with a gentle ease. Holiday exchange is still very much valued as part of the Pestana loyalty arsenal. Booth explains: “It is of great value. We have 12 Pestana Vacation Club resorts throughout Portugal and six in Brazil, but it isn’t enough for our members, they want more travel options. RCI affiliation means we can give our members a world of holiday options from the 4,000+ properties affiliated to its exchange programme and that can only be a positive thing. I would say it’s very important to single site resorts.” Roberts agrees that whatever else may have changed, the value of RCI affiliation hasn’t. He adds: “Today’s active retirees are increasingly looking for new destinations, activities and holiday lifestyle experiences and resort developers can give them that cost effectively by being part of a global holiday exchange network. The RCI Late Deals discounted holidays are an important offering from
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RCI, as we find many people are self-employed today and they can, and do, go off on holiday at very short notice.” Loyal to the end Loyalty programmes do so much more than bring the same customers back. They are the best basis for an engaging owner referral programme and vital organic growth. “We are fortunate at our older resorts where we see a great number of owners’ children continuing to use and benefit from their parents’ membership,” says Roberts. “They go on to holiday with their own children which then generates demand for apartment upgrades to suit family needs.” Pestana Vacation Club is finding a number of older members are giving their ownership to their children for them to use as equity in their own purchase of a larger family-sized unit. Parents who are Pestana Options members can also use their credits to buy their children a holiday on the Algarve. “It’s a great gift - holiday costs covered,” comments Roberts. And Pestana doesn’t just keep it in the family. Since 1994 Pestana Vacation Club has operated a highly successful owner referral programme whereby members are incentivised to invite friends to join the ‘family’. The best part about it is, the owners vet the referred person themselves - the joining criteria is set out in the joining letters. It produces qualified leads for Pestana, while giving the owners control and a say in who they want to become owners with them. “Our referral programme is promoted on our Facebook and Instagram channels, and at point of sale which allows us to gauge how our new owner feels - are they happy and proud to tell their friends about their new purchase? It
LUXE LIFESTYLE: Below left: Madeira Beach Club hosts weekly dances. Below: A stylish Pestana bar area. Below right: Pestana Chelsea Bridge Hotel.
W H E R E D I D I T STA R T ? H OW D I D I T G R OW ? Peter Booth walks through the milestones in the expansion strategy that built a lodging empire. Madeira - Late 70s/early 80s – Dionisio Pestana returned to Madeira, island home of the Pestana family, and started work in the Carlton Hotel. Interest rates were at 28%; the unions were strong; times were very challenging. in Portugal, Mozambique, São Tome Principe and Brazil, all Portuguese-speaking countries. 2000s – The focus turned to European capitals with acquisitions in London, Berlin, Barcelona and Amsterdam. This was followed by expansion outside Europe in Miami and New York. Launch of the Five-Star Luxury Collection; FourStar Pestana Hotels; Pousada brand comprising 37 castles and other such historic properties entrusted by the Portuguese government to the Pestana Group to breathe new life into them and to preserve them for the nation. Launch of the CR7 lifestyle boutique hotels in a joint venture with Portuguese football legend, Cristiano Ronaldo. Designed to be edgy, unique and on trend with Millennials, it would appeal to a younger consumer. Madeira saw the first CR7 opening, shortly to be followed by Lisbon, New York and Madrid. This was the missing and now the fourth segment of Pestana's resort and hotel property portfolio.
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80s/90s – Dioniso Pestana started to buy hotels
tells us how well the product was sold to that purchaser.” says Roberts. “Members on resort are reminded of the programme, which delivers rewards whether or not their referral joins us. It is promoted in our newsletters and communications, as well as during follow ups to positive member questionnaires, from which we get between 88 and 92 per cent satisfaction rates.” Rewards include points that can be used towards maintenance fees, a free week’s stay or as a cash discount off a Pestana hotel booking. With a 38 per cent closing rate on this programme, Roberts and his sales team are pleased with the result. Booth says it was through monitoring of the online chatter and views aired on sites such as TripAdvisor that his eyes were opened to the need for change. “Twenty years ago there were travel agency brochures with small pictures of resorts in them. Today there is the internet where everything is transparent: the cost of the flights, accommodation, insurance, while on TripAdvisor people are going on virtual tours of your resorts, as well as talking about your properties. We wanted to be part of that conversation. And today we are. “We learned from the internet how people holiday today and we have adapted our product in line with the way they holiday now. We have to be better in what we deliver; social media keeps us on our toes!” With a whole department dedicated to monitoring the online ‘chatter’ about the Pestana Group holiday offering and experience, Pestana Vacation Club is likely to stay ahead of the curve for the next 20 years and can look forward to growing its loyal member base with the help of social media, and with it no doubt, its impressive leisure property portfolio.
Peer-to-peer collaboration is the way the business world works today. It is especially advantageous when that collaboration is with an international operation of scale across diverse markets, as First Resorts discovered working with RCI… BY HELEN FOSTER
“WE HAVE SEEN A CONSIDERABLE UPLIFT in occupancy, particularly during the shoulder season months, which saw a lift of around 35 to 40 per cent in the year’s first quarter,” said Robin Mills, Director of First Resorts’ Brockwood Hall Lodges. The business move that made this difference - and the marketing of this elegant leisure property in the UK’s wild and wonderful Cumbria so much easier - was taking it into 1 8 Q3/Q 4 2 01 7
the Wanderwood Lodge Holiday Collection. This brand is one of seven in the renowned Hoseasons’ stable and has proven to be a perfect fit for Brockwood Hall Lodges. Wanderwood wonder Mark Warnes, Property and Portfolio Director at Hoseasons is thrilled with the way in which this latest brand addition to his group’s offering has taken off. “This
WONDER IN THE WILD:
Brockwood Hall Lodges in the UK's Cumbrian countryside offers the idyllic outdoor lifestyle with upscale amenities.
MARK WARNES Property and Portfolio Director, Hoseasons.
Director of First Resorts' Brockwood Hall Lodges.
is a pioneer concept and its point of differentiation is that it is a particular type of park, being a lodge product only. We do not mix it up on these sites with camping and caravans,” Warnes explains. This is somewhat unusual for a product that is set in natural woodland locations with getting back to, and being at one with, nature at the core of the holiday experience. It works - and it works very well. Launched just two years ago, Wanderwood established six park locations in its first year, and now has as many as nine in this brand portfolio. Warnes has set an aggressive target of operating 12 parks by 2018. “The appeal of Wanderwood is that it has something for everyone. Some lodges have hot tubs, some are petfriendly as the locations lend themselves to this. We offer a Pets Go Free special offer giving guests a pet welcome pack, complete with doggy treats, pet blankets and the like. This is all part of our differentiation,” said Warnes. Hoseasons’ marketing of this brand is pitch perfect, as you’d expect of a holiday company that has been creating innovative holiday experiences with wide appeal for 73 years now. “We know what we’re doing,” said Warnes. With marketing imagery of beautiful natural environments and quality accommodation which is empathetic with its surrounding landscape, and much talk of den building, stargazing, dog walking and bug hunting, Hoseasons has put together a product menu of wonderful outdoor experiences with wide appeal. “It’s about providing inspiration and ideas to holidaymakers as to where they might like to go, thereby shortening the holiday decision-making process,” he added. Warnes told RCI Ventures that its customers are predominantly from the UK. However, Hoseasons’ brand power has a formidable reach across mainland Europe, having built a loyal customer following in the Netherlands, France and Germany among others. “We own a very large percentage of the lodge market and it would be unusual if you didn’t end up in a Hoseasons’ resort when booking a lodge holiday in the UK,” he said.
A first for First Resorts So, how does it work for Brockwood Hall Lodges? It’s very simple. Working with the shared-holiday ownership units at Brockwood Hall, any unused inventory which Brockwood Hall members have put into the exchange pool but not taken out is then marketed by Hoseasons under the Wanderwood brand. And the Hoseasons’ marketing machine is very polished, slick and powerful. This collaboration gives First Resorts a brand power and reach that it would not have if operating on its own in the European or UK markets at this time in its evolution. Handing its rental programme to Hoseasons under this franchising agreement is fundamentally outsourcing this element of its marketing operation, which is saving First Resorts both time and money. It doesn’t have to invest in the considerable marketing resource it now uses through its collaboration with Hoseasons. Nor does it have to go through the pain of climbing the learning curve in this rental market. Mills explains how Brockwood Hall Lodges came to this partnering agreement. “It was in 2014 that we entered discussions as to whether we should get involved in shared ownership and holiday exchange with RCI. We hadn’t known about Hoseasons at that time,” he said. “Our RCI team were phenomenal, both in the UK and across the pond. The property was really run down
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We were particularly energised that Hoseasons catered for customers who were looking for this lifestyle.
Wanderwood Lodge Holiday Collection encourages a healthy family lifestyle.
– ROBIN MILLS
when First Resorts acquired it and in desperate need of extensive investment, renovation and refurbishment. RCI’s knowledge of the UK market - what’s hot and what appeals to the consumer in that market - was invaluable. “And then RCI introduced us to its sister company, Hoseasons, part of the mighty Wyndham Worldwide Group of companies. The Hoseasons team quickly identified the potential of Brockwood Hall Lodges as being an ideal fit for its Wanderwood brand product. We were thrilled, as the whole idea of a healthy outdoor lifestyle, while being able to kick back in the most comfortable accommodation, was exactly what we planned to offer. The idea of the kids getting muddy, dirty, running free and enjoying an exciting healthy lifestyle was totally aligned to the philosophy that defined our vision for the Brockwood Hall site. We were particularly energised that Hoseasons catered for customers who were looking for this lifestyle.” But Hoseasons is extremely particular in its selection of partners and it wasn’t easy making the final cut. Brockwood Hall Lodges was one of six possible partners in the Cumbria area under consideration as a brand partner. “We spent a lot of time investing in the development of woodlands at our 56-acre location, landscaping and building woodland walkways. Hoseasons asked for total commitment and we gave it in a £1.5 million lifestyle refurbishment,” Mills explained. “Just after Christmas 2015 we launched with Wanderwood and have never looked back from that point. We now have nine of our timeshare lodges marketed under the new brand when the inventory is not being used by timeshare customers. So when units are handed back to us - which is especially the case in the low season months - we can fill those now. Our RCI exchange units are mixed in the same pool as our Hoseasons’ units to ensure their usage is maximised at the best times and seasons. We are adding a further two lodges to this site, which will take the total number of lodges to 35. “Hoseasons and RCI work well together. Both have the Wyndham ethic which is fantastic to work with.” The holiday exchange element is still important, with RCI accounting for 50 per cent of unit usage. Mills adds: “RCI exchange is absolutely valued as an integral part of our business. We know those timeshare owners will provide a strong revenue stream in fee payments; RCI exchange allows us to offer more holiday choice for their purchase, plus RCI supports our marketing, for example by promoting our recent resort refurbishment in its member publications. The compatibility of all parties in this project is second to none.” Prior to working with Hoseasons, First Resorts had identified the benefits of mixing it up and bringing rentals into its portfolio, but according to Mills it wasn’t 2 0 Q 3/Q 4 2 01 7
giving a particularly good yield. “We needed something sexy and a strategic partner. For our shared ownership we had found RCI. It was a no brainer that Hoseasons should be our first choice for our rentals and we are more than happy to be exclusive to that brand. It has changed the dynamic of this resort,” said Mills. The success of this project is reflected in First Resorts’ acquisition of a new property in the same location. Dunningwell Hall occupies 21 acres of woodland, but this property will be a mixed-use model with nine hotel suites in its main building. “Dunningwell Hall will open in January 2019, and will have a spa, conference facilities and a wedding venue, as well as 30 more lodges,” said Mills. The extras Hoseasons offers a complete solution, with many additional benefits to its unrivalled marketing reach. All Brockwood Hall rental bookings are made direct with Hoseasons, as you’d expect. What you might not expect is the bespoke account management and reporting suite that comes as part of the package. “We look at the performance throughout the year and, in response to market and demand changes, we make the requisite adjustments to the product offering so it performs as well as it can at that time, in that market,” explained Warnes. “As a result, we can see that bookings at Brockwood Hall Lodges are 53.7 per cent up on prior year, representing a 63 per cent increase in rental revenues for the resort. “There is hand holding on both sides. We lead on the market situation, monitoring pricing at different times throughout the year, setting the right prices at the right times. Our expertise lies in seasonal pricing structures and strategies. This maximises revenues during high and low seasons.” Hoseasons also advises on layout, interior design and financial forecasting to look at what can be achieved in revenues using different modelling across different units, as well as producing letters of support for planning applications. In summarising what he describes as a “pick ‘n’ mix” business, Warnes concludes: “We are a marketing agency, and we are also a world-class consultative team whose solutions are real game changers.”
Profile: Stephen Carter, OBE STEPHEN CARTER, OBE, is incredibly accomplished in the hospitality industry, with credentials gained in both large-scale and intimate hotel operations, in addition to a list of awards as long as his arm. REBECCA GORMLEY discovers the secrets of his success in an exclusive RCI Ventures interview. “THE HONOUR OF LOOKING AFTER NELSON Mandela is, without doubt, the most special moment of my career. It was 1999 and I was the General Manager at The Caledonian (now The Waldorf Astoria Edinburgh – The Caledonian), a stunning hotel nestled in the shadows of Edinburgh Castle. Mandela was awe inspiring from the moment he walked in; he had a genuine warmth about him and one of the most remarkable things he did was to meet each and every one of the hotel staff, which was truly kind and very gracious of him.” Carter’s dedication to empowering his staff and valuing their views and ambitions has been evident throughout his career. After graduating from the University of Surrey with a degree in Hotel Administration, Carter crossed the border into Scotland, where he would spend the majority of his working life, starting out as a Trainee Manager with Thistle at the Golden Lion Hotel in Stirling, where he gained a great understanding of each staff member’s role – integral to the running of a successful hotel.
The early years He embarked on a 12-year stint at one of the world’s largest hotel chains, Holiday Inn. It was there that Carter gained invaluable experience in a large-scale operation, and was selected as the Innkeeper to open Scotland’s first Holiday Inn in Aberdeen. “It was entirely different in those times, Holiday Inn was dominating in the US, and was breaking into the UK market.
Stephen Carter receives his OBE in 2007 from His Royal Highness The Prince of Wales, for services to the hospitality industry.
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The honour of looking after Nelson Mandela is, without doubt, the most special moment of my career. They flew me out to train at the Holiday Inn University Olive Branch in Mississippi, their centre of learning,” he said. Carter was made Innkeeper/General Manager in various UK locations, including the 330-bedroom Holiday Inn Birmingham City Centre, which at that point, was one of the group’s largest properties in Europe. “Working for such a vast and established brand was truly fantastic. It taught me structure. It gave me contacts across the world, and importantly, it gave me opportunities. I had never worked abroad at that point – it wasn’t like today, when you can expect to travel throughout your career – it was the ‘70s!” Carter returned to Scotland, working for a series of individual hotels, before entering the world of five-star hotels, as General Manager at The Caledonian, where he would meet Nelson Mandela. “Private hotels are vastly different to international operations. Each one, of course, has its advantages and disadvantages – they are not exactly comparable. However, one of the most attractive fundamentals of private hotels is that you’re able to make your moves quicker!” Building his empire Carter is one for seizing opportunities, and one of his notable achievements was at Fairmont St Andrews, where he was the driving force behind the new £58 million five-star development, which comprised of 209 bedrooms, 30,000 sq. ft. of conference space, and two golf courses set in 520 acres. Carter built an empire of staff, including the entire senior management team and staff members, ensuring that 80 per cent of the recruits lived locally and were from within the hospitality industry. He was recruited in 2000 and succeeded in delivering a hugely successful business and marketing plan. 2 2 Q 3/Q 4 2 01 7
It was not an easy ride. The market was immensely challenging – the blissful Scottish countryside was overrun by the calamity of foot and mouth disease, which was closely followed by the tragedy of 9/11. The hospitality industry felt the agony of this rocky time, and yet Carter was able to ride the storm, and enable Fairmont St Andrews to flourish and become one of the most prestigious hotels in the region. Creating communities The secret of his success? Carter explained it is partly a result of the influence hotels have on their surrounding communities. “If I ask you for a recommendation for a hotel close to your home, you are unlikely to have ever stayed at that hotel – but you are almost certain to have an opinion on it. “It is essential that hoteliers establish routes within their communities. Not only is it advantageous for monetising leads, it is also indispensable to those living close by, and who will make the hotel truly feel part of that area. Working with the community not only comes from the senior management team, it is carried out by staff, who in turn are more engaged with their roles.” People, Carter believes, are the making of a leading hotel. “Meeting and greeting guests, making them feel welcome, is only a scratch on the surface of what really contributes to the vision of a hotel and its success. It is those behind the scenes – they put the wheels in motion to provide a seamless experience, a quality hotel and an even stronger reputation. “We work in a young industry and it is essential that we empower individuals, giving them confidence to push boundaries so they develop their strengths.” These core values earned Carter his OBE for services to the hospitality industry in 2007. While he was Chairman of Hospitality Industry Trust Scotland, Carter was devoted to investing in young people and creating opportunities through scholarships. He was a Founding Director of the International Leadership School, launched in conjunction with the Strathclyde Business School, Cornell University in New York, and École Hôtelière de
Chairman of the Kohler Company. “Mr Kohler has a love of golf and hospitality. Establishing and acquiring these fantastically luxurious resorts was a natural step for the Kohler family business. “We are constantly looking for opportunities to grow, and the refurbishment plans will help us to keep the Old Course Hotel at the top of its game. We’re replacing all of the windows on the second floor, upwards to the fourth floor bar, which offers some of the most iconic views of golf courses in the world. Durable yet authentic slates are being installed on the roof, as many of the golfers often hit the ball over the hotel, to access the 17th hole. The world-class Kohler Waters Spa is also being extended, and we’re in the midst of building hybrid soccer pitches.”
SOMETHING OLD, SOMETHING NEW: The Old Course Hotel St Andrews Golf Resort and Spa stays at the top of its game. Below: The Duke's Club House and the deluxe suite lounge at the hotel.
Looking to the future When asked how he and the Kohler Company will navigate through the unknown period of Brexit, Carter expressed confidence in the industry’s resilience. “The outcome of Brexit can be seen as both good and bad. Many of our American guests can take advantage of the dollar-to-pound exchange, and we have a hugely busy season ahead of us. The main concern, which I think is apparent across the industry, is the number of European staff working at hotels and resorts. Many of them have made their homes here in St Andrews, so we hope that Brexit will not change this. “As for the Kohler Company, the future is certainly looking bright. Some of our brand-loyal customers have now moved into the Hamilton Grand, the Company’s latest venture – a collection of private luxury residences overlooking the world-famous golf course.” A man who has hospitality in his DNA, it is certain that any hotel or resort with Stephen Carter as the driving force behind it, is sure to overcome any obstacle. As for his plans beyond the Old Course Hotel, Carter admitted it might be time to hang up the boots after such a successful career. He will busy his days with his other passion – working with the community, especially in his capacity as Director of the Royal Scottish Orchestra.
Lausanne in Switzerland. A modest man, Carter is careful not to dwell on his many astounding achievements, which have shaped him as one of the greatest influences in the Scottish hospitality industry. His many accolades include: Hotel and Caterer Manager of the Year 2005; Hotelier of the Year Hotel and Caterer 2011; Outstanding Industry Contribution Scottish Hotel Awards 2011, and Freeman of the City of London, to name but a few. His work at Cameron House, however, is one of his best accomplishments. As Managing Director for seven years until April 2015, Carter grew the business from a £12 million turnover to £28 million, and was responsible for repositioning the hotel in the five-star marketplace, in which RCI played its part. “RCI’s advice and guidance throughout my time at Cameron House was tremendous. The RCI team understand exactly what customers are looking for and helped to feed the development of the business and product upgrade.” Carter oversaw a £50 million refurbishment of the exquisite, baronial mansion which offers a Championship golf course and introduced new attractions, including Michelin-Star restaurants, seaplane trips on Loch Lomond, falconry and quad-biking trips. Today, Carter is where he feels at home – carrying out an extensive refurbishment plan for a five-star luxury golf resort, in the heart of St Andrews. Bordering the renowned 17th Road Hole, the Old Course Hotel St Andrews Golf Resort and Spa is recognised as one of Europe’s leading resorts, boasting 144 rooms, including 35 luxury suites. The Old Course Hotel was famously acquired by the Kohler Company, an American family company which originated from manufacturing bathroom tubs. It is now also a strong player in the hospitality industry, with two other hotels and resorts located in the US and a third opening July 2017. As General Manager of the Old Course Hotel, Carter has a close relationship with Herbert V Kohler, Executive
Choose China Doing great business is largely a numbers game – and the numbers are so great in China that engaging with this market will be a game changer for your business. BY H E L E N F O S T E R
CHINA IS A market where 80 per cent of the population is digitally connected across a plethora of internet devices and platforms. Retail brands who are big players on the Chinese social media channels can expect to have 800 million followers or more. Paul Dean, Principal of consultancy Dean & Associates, has many years’ experience of hospitality and resort business operations in China and South East Asia. His consultancy has worked on a mixed-use ski destination, some 186 miles north of Beijing, which will be a component site for the China 2022 Winter Olympics. It will have 50 miles of ski runs, plus a number of hotels and real estate offerings. Dean pays close attention to the numbers in this market, which he describes as “phenomenal”. “The number of mobile device users in China is on a scale such as we have never witnessed in the west,” he says. “Digital marketing and tactical use of social media are key to your marketing success in China. Responsive sites for mobile devices, transactional sites and WeChat – all of this technology is fundamental to success in this 1 Q 3/Q 24 Q 3/Q 4 42 01 2 01 77
PAUL DEAN Principal, Dean & Associates.
Sim, of RCI Asia Pacific, said: “RCI.com’s Chinese locale was launched seven years ago in 2010. We also have a team of Chinese speaking vacation guides based in Singapore assisting our members with their vacation plans. The number of Chinese members making bookings online via RCI.com is certainly increasing year on year. We communicate with our members over a variety of platforms, and in the last two years we have been leveraging WeChat, which is currently China’s most popular marketing channel.”
The growth in China’s tourism expenditure consolidates its position as the world’s number one tourism source market, having followed a trend of double-digit growth in tourism spending since 2004 – UNWTO 2016 REPORTING
ISABELLA NG Director, Business Development, RCI North Asia.
TANIA SIM Affiliate Marketing Manager, RCI Asia Pacific.
World’s No. 1 The World Tourism Organisation (UNWTO) reports that China led international outbound tourism in 2016, seeing a 12 per cent increase in travel spending. UNWTO reported that international tourism expenditure from China grew by $11 billion to $261 billion last year. The number of outbound travellers from China in 2016 rose by 6 per cent to 135 million in the year. This growth, according to UNWTO reporting, consolidates China’s position as the world’s number one tourism source market, having followed a trend of double-digit growth in tourism spending since 2004. The 2016 World Travel & Tourism Council’s China Economic Impact Report highlighted travel and tourism as a key contributor to the country’s gross domestic product (GDP). Its total contribution to GDP in 2015 was CNY5,366.4 billion and was forecast to rise to CNY11,225 billion by 2026, representing 9.4 per cent of China’s GDP. Travel and tourism directly supported 2.9 per cent of total employment in the country, a figure which is expected to rise to nearly 4 per cent in under ten years’ time. Inbound visitors generated CNY384.6 billion in 2015, a number which is, again, forecast to increase to CNY1,579.7 billion in 2026. With numbers that cannot be ignored, China will feature largely in Ng’s business development strategy for RCI in her region. She said: “China is a growth market for Asia. Chinese tourists spent a record US$261 billion overseas in 2016, while its domestic tourism market was worth US$4.44 billion. The potential of that market for our business is huge.” Choosing China for timeshare There are currently 75 resorts in China affiliated to the RCI vacation exchange programme, and Chinese nationals account for almost 25 per cent of RCI’s total member base in Asia. Ng reports that there is definitely an upward trend in R CI VEN T U RES 2 5
market. Many of the global luxury brands are now developing digital strategies for China to see what it can do for them.” WeChat is the most popular Chinese lifestyle app used by an increasing number of major brands as a primary marketing pillar. This platform was launched in 2011 and this year it is reported to be one of the world’s largest standalone messaging apps, having more than 938 million monthly active users and capturing approximately 30 per cent of the country’s online chat. It is also a fully transactional platform. Consider then, that according to the World Bank and US Census Bureau, China’s population numbered 1.3 billion in 2016. As impressive as the numbers of Chinese social media surfers are, the potential to build brand community and loyalty across the country’s digital media in the future is even greater. RCI’s Director of Business Development for North Asia, Isabella Ng, describes the power of the country’s e-commerce sector by referencing the sales figures of China’s Amazon ‘Black Friday’-equivalent sale. Taobao, a Chinese online shopping site similar to eBay and Amazon, generated revenues of CNY120 billion – that’s US$17.9 million – on its 11 November ‘Singles’ Day’ mega sale! A deep dive into the world of digital marketing is crucial to success in China, according to Tania Sim, Affiliate Marketing Manager for RCI Asia Pacific. She explained: “The percentage of internet users with personal email addresses is on the decline. Email open rates are stagnant due to the issues around strict spamming regulations, firewalls and security. “WeChat works best for us as a marketing channel in China. This market is different from most of the world in terms of social media, as international online platforms such as YouTube, Facebook and Instagram are all banned in China. Instead they have created local versions of these platforms, with Weibo and WeChat as the predominant social media and marketing channels in China. Other channels include YouKu, Baidu and Qzone. “RCI Asia launched its own official WeChat page which won an ARDA (American Resort Development Association) 2016 award. We were delighted with this win as it recognises the importance of the market in China to our global growth, RCI was one of the first international vacation travel companies to build a website in Mandarin.”
timeshare development and ownership in China. “Resort developers with an active affiliation with RCI are still in the market and thriving, while hotel operators are now seeing opportunity in timeshare,” she said. “There are challenges around the way timeshare is sold which may harm its public perception and reputation. For this reason RCI prefers a conservative approach, selecting only the most professional and ethical resort and hotel operators to work with. We look at China as both a destination and a source market. Currently, the majority of timeshare products in China are purchased by Chinese residents.” As a source market, China has immense potential, as travel visas are relaxed, the country opens up to wider world trade, and its population is one not just of vast numbers, but of increasing wealth. As RCI has noted, the Chinese have an appetite for travel and therefore value having the flexibility to travel using the RCI holiday exchange services. “Many of our Chinese members exchange into destinations such as Thailand, Bali and Malaysia, countries where they are also looking to purchase timeshare,” added Ng. Ng believes the lack of marketing in the local Chinese language by European timeshare marketers prevents the Chinese from looking further afield to buy timeshare. “There isn’t a lot of promotion of European timeshare in China in the local language, so they are not aware of the opportunities to buy timeshare in Europe,” she said. However Ng does report seeing great feedback from those who have experienced the timeshare product. “It is perfect for multi-generational vacationers taking family and friends away with them,” she added.
C H I N A FAC T F I L E $114.1 billion 2015 International Tourist Receipts Source: UNWTO Tourism Highlights 2016
$168 billion 2016 Value Outbound Tourism Source: International Monetary Fund
136.8 million 2016 Outbound Travellers – 2.7% YOY Growth Source: China Outbound Tourism Research Institute
$261 billion 2016 Top Tourism Spender Source: UNWTO
$11.3 trillion Value of the economy in 2016 Source: International Monetary Fund
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6.9% GDP growth in Q2 2017 Source: National Bureau of Statistics of China
7% Predicted annual growth of China’s travel and tourism sector to 2026 Source: World Travel and Tourism Council Travel and Tourism Economic Impact 2016 Annual Summary
By 2026, the travel sector will represent 10% of the Chinese economy Source: World Travel and Tourism Council Travel and Tourism Economic Impact 2016 Annual Summary
What does it look like? The majority of business models in China are mixed-use, hotel and timeshare operations, though the condo-hotel model is becoming increasingly popular. “The Chinese like to make investments, and they view these products as investment opportunities,” said Ng. “We are starting to see a rise in the popularity of the fractional product in China.” Dean has examined other opportunities within China, as domestic developers and hospitality companies have learned to appreciate the financial benefits, as well as the operating synergies, which a timeshare component as part of the mixed-use resort can deliver. There are clearly opportunities for the growth of shared-ownership products which can leverage China’s unique cultural heritage. It is also important to identify locations which are multi-seasonal, such as are to be found in the Yunnan Province in particular. Dean sees timeshare’s strength in Thailand as a plus. “Thailand is the most important receptor for Chinese outbound travel,” he said. “Five years ago there were barely any Chinese inbounds to Phuket. This year, Chinese visitors will make up more than 50 per cent of Phuket’s international inbound market. Bangkok, Chang Mai and Koh Samui are also attractive destinations for Chinese travellers. This growth will continue in line with low-cost airlines setting on new routes to the country.” The traditional long-term timeshare models do not resonate well with Chinese buyers. Dean explained: “You have to look at how you can design and deliver a shorter
Quality marks out timeshare resorts in this market. Opposite page: HNA Resort Sanya. Left: Shangshanqi. Below: Bo'ao Yudaiwan Hotel.
G R OW T H OF CHINESE OUTBOUND T R AV E L L E R S IN 2015 +40%
Thailand and Sri Lanka: almost 100% Middle East, Egypt and Turkey: growth over 60% Norway, Croatia, Austria and Finland: growth over 40% Germany and Switzerland: growth over 30%
US and Australia: 18% Source: China Outbound Tourism Research Institute
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term product. Timeshare in China is recognised as a component of the mainstream travel and tourism sectors, which is a positive. The challenge lies in the minimal understanding of the concept among potential Chinese consumers. They will often compare the cost of timeshare with a single hotel room rate, not realising that the spacious accommodation offered by timeshare can cater for whole family groups. The consumers in this market are incredibly cost conscious and they need to be educated to recognise that timeshare represents real value for families holidaying together.” RCI’s Sim agreed. “The vacation ownership industry within China is adapting to the preference of today’s consumers by developing shorter term memberships, eliminating the hard-sell decks, and turning to social media channels. Millennials are more receptive and driven to purchase when buying experiences without a long-term commitment,” she said. Sim also sees the shared-vacation ownership and timeshare products as holding appeal for the way the Chinese take vacations. “Millennials are looking to access assets rather than buy them. They are also experience seekers, and the Chinese have a tendency to travel in extended family groups and with friends. Shared-vacation ownership gives them exactly all the things they seek in their travel, and timeshare accommodation, over traditional hotel rooms, offers a comfort and value-formoney option which also affords larger vacation parties a good deal of privacy during their stay.” There is also an appetite for ownership. Dean says that to get round the restrictions placed on second home ownership imposed by the Chinese government to protect against a property bubble, couples have been known to divorce just to be able to buy a second home… Add to that shopping basket of holiday must haves, a strong brand, and you have a head start in the Chinese
market, as Dean pointed out. He said: “The Chinese are far more likely to look at timeshare if it is brought to market by a brand they recognise. The bigger brands, such as Wyndham, have ways into the market and the capacity to provide call centres and customer servicing in the national languages. You have got to have staff who can speak Mandarin; you need Chinese nationals in resort because it is as much about understanding their culture as speaking their language. For instance, they want Chinese satellite TV channels and items such as tea sets and rice boilers in any apartment they would consider staying in. They have a very different mindset to most other tourists and, for instance, love to buy all sorts of food stuffs from local supermarkets. Fly-buy visits are also important, as the Chinese like to touch, feel and see for themselves what they are getting.” Dean should know, as his learnings are based, in part, on his collaboration with Michael Qu, one of his business associates, who is a real estate lawyer based in Shanghai, who has carried out extensive research for retirement home and timeshare projects. Dean believes that it isn’t just the Chinese consumers who need educating. “Developers need to sit down and understand the potential of shared-vacation ownership models,” he said. “Half a billion Chinese nationals have moved in recent years from rural to urban environments and many of these folks take holidays. In extreme cases, this can mean as many as 250 million people in China are looking to travel on the same days during Chinese New Year or the Golden Week holidays! There is an exploding middle class whose appetite for travel and new experiences will grow significantly. “There is great potential for China as a destination market. There are already big-brand conglomerates in strong positions to exploit the opportunities here. For example, the HNA Group - Hainan Airline and Hotels - is a successful domestic brand. The HNA Group has a 25 per cent share in Hilton Hotels, which may now be taking a look at China as part of its growth strategy for Asia. Bringing Hilton’s vast expertise and experience to this market will enhance the stature of the timeshare product, as well as instilling greater consumer confidence.” Developers cannot afford to be slow off the mark. Dean explained: “Vacation ownership makes a lot of sense in China, where owning real estate and second homes is massive. But the approach here is ‘I get the idea; now let’s get it done’. There is a frequently-used expression to describe the way business is done here - ‘China fast’. And it is! I was speaking with an executive who had launched a new rental concept in March. By May of the same year his platform already had 12,000 apartments of rented inventory on it.” The developers’ view Lilian Miao, General Manager of Shanghai Huangyue Travel Consulting, which runs the ETC Vacation Club, brought its club into timeshare in 1996, making it an industry pioneer in China. It is a single site mixed-use resort of 180 rooms, with 20 of them put into timeshare. As a young timeshare sales agent, Miao noticed that timeshare was an “up and coming industry in China”. She said: “With the growth of the sharing economy, I strongly 2 8 Q 3/Q 4 2 01 7
JIN PENG Marketing Director, Beijing Foriseland Real Estate Development.
LILIAN MIAO General Manager, Shanghai Huangyue Travel Consulting.
believe there is great opportunity for timeshare, which is why I started to run my own company. ETC Club (Elite Travel of China), working with RCI as the world’s largest exchange services provider. Didi (similar to Uber) and Tuija (similar to Airbnb) were both succeeding in China. “My goal is to educate my customers in the use of the RCI system to ensure they discover and value the benefits of the extraordinary vacation experience, and to increase my membership by 20 per cent, year on year. I am pleased to say that I have exceeded my goal target and I hope to work closely with RCI to open resorts in different locations in the future. “Now my goal is to expand my professional sales and marketing team, and the resorts in our club. My vision is to have more Chinese people knowing our product and what RCI is, and to think of ETC and RCI when they think about travel.” Currently selling to the domestic market, Miao would be happy to work with overseas timeshare companies in the future. She currently sees that 40 per cent of her guests are inbound visitors, a number that is increasing, especially from Malaysia, Singapore and the US. “Chinese travellers are looking for genuine vacations which means time with the family rather than organised tours, and timeshare meets those needs. The potential is there, but those interested in getting involved in timeshare in China must understand the behaviours and culture of Chinese customers. The product must be localised to succeed. The industry in China will continue to grow and I will continue to partner with RCI to develop better products with greater value and to build a sustainable business in the country.” Jin Peng is the Marketing Director of Beijing Foriseland Real Estate Development which operates Season Holiday Club, an RCI-affiliated resort partner. The club comprises multi-site mixed-use resorts and since 2002, 100 of its 700 rooms have been given to timeshare. Having been in the hospitality industry for 20 years, Peng explained that he was interested to find a unique and different professional business model in timeshare. “I could see my family and friends enjoying the benefits of timeshare,” he said. “So I believed that a significant number of our customers would like to have the opportunity to purchase and experience the product, which I saw as a good fit for the way they like to holiday today.” Peng has built a successful marketing and sales operation outside of China too. Season Holiday Club’s sales are strong in Malaysia and Australia, while exchange guests from Japan and South Korea represent 10 per cent of timeshare exchangers making up the inbound customer numbers. Timeshare’s ROI for Peng’s business has been in the increasing trend in outbound travel - and therefore the ability to exchange vacation experiences. “There is a growing relaxation of travel visas now, as compared to 10 years ago; and also a growing choice of airline routes to overseas destinations. In the past three years there has been a huge increase in online travel agencies and metasearch websites for hotels and flights. “With investment, creativity and innovation, the timeshare vacation industry will be successful in China.”
2 0 1 8 F O R E C AST F O R C H I N E S E O U T B O U N D T R AV E L
• Fosun International Ltd, a Chinese conglomerate, is driving a venture to transform the former Athens’ airport site into one of the biggest real estate projects in Europe. Club Med SAS is Fosun’s Greek development company and its leadership predicts annual Chinese inbound numbers to Greece will reach 1.5 million in the medium term and is using its stake in the Thomas Cook Group to build vacation packages for the vast Chinese market. Through its various operating companies, Fosun manages €64.3 billion in total assets globally, and has invested more than €200 million in Greece.
200 250 300 350 400
Outbound Chinese travellers, millions
H OT D E ST I N AT I O N S For developers looking to the next vacation hot spots, here is where our featured experts would be looking to build resorts. The Chinese government is encouraging overseas investment in the regions it wants to develop as international tourism destinations. Hainan Island and Provinces – In the south region, and has a good climate, enjoying popularity as an established vacation destination. It benefits from a well-developed infrastructure and is often referred to as the ‘Hawaii of the East’. Chengdu, in Sichuan Province – Capital of southwestern Sichuan Province. Famed for its giant panda breeding and conservation area, it has a rich cultural history dating back to the 4th century BC. Fujian Province – Situated in southeastern China, this area is known for its beautiful mountains and coastal cities. Yunnan Province – In southwestern China, characterised by a good climate, varied landscape encompassing snow-capped mountains, rice terraces, lakes and deep gorges. The region is known for its ethnic minorities, the town of Kunming, known as the ‘Spring City’, and its many museums and temples. The Shilin Stone Forest contains limestone karst peaks formed 270 million years ago. Paul Dean believes it has “the potential to become another Florida”.
• In May 2017 the first fully-booked ITB China took place in Shanghai demonstrating the power of the new marketplace for the Chinese travel and tourism industry. With a 12 per cent increase in spending, China led international outbound tourism in 2016. • Italy is chasing the Chinese tourists. Dorina Bianchi, Italy’s Undersecretary of State for cultural heritage and tourism, visited Shanghai recently to meet with China Tourism Academy Vice President, Li Zhongguang. “The EU-China Tourism Year 2018 is the clear expression of the reciprocal importance of tourism and cultural relations between China and Europe,” Bianchi told The Shanghai Daily. “During the forthcoming year, there will be numerous initiatives, in which Italy intends to play a leading role, promote the less-known destinations in the Peninsula, and design a series of transnational projects.” • Regeneration of China’s ancient Silk Road is another route into China for Europeans. The Hangzhou Tourism Commission, in a joint venture with Expedia Media Solutions, ran the ‘Silk Road Race, Explore the Living Hangzhou’ tourism campaign. It opened doors for European travellers to explore Hangzhou. More than 30,000 visitors browsed the campaign website, and over 16,000 retweets were generated via a competition between England, France, and Germany. France won the competition, as it was the first of the countries to reach 5,500 social media interactions. • Following the G20 Summit, long-term city planning in China included an upgrade to city infrastructure and tourist attractions. R CI VEN T U RES 2 9
The process of connecting China to the rest of the world via the development of transport infrastructure is well underway. This will open doors to unparalleled opportunity for the travel and tourism sector. Here is just a sample of some of the 2017 initiatives that make the difference. • Air China launches Air China Easy Way Beijing – Frankfurt. A collaboration between Beijing Capital Airport and Frankfurt Airport will open China’s first international express route in September this year between China and Europe to support the development of the BeijingTianjin-Hebei region.
C H I N A CO N N E C T I N G
e l y t s e f i L y r u x u L e h T G N I RAG
With bigger, better and more exclusive resorts in development, consumers are in pursuit of the next-level experience. We present three Latin American vacation clubs, each committed to delivering their own unique luxury lifestyle to guests. BY LORRAINE LOVELAND
AS RESORTS EVOLVE, SO TOO DO CONSUMER aspirations and the desire for a feeling of exclusivity on their next holiday. Hotel brands and management companies are turning to lifestyle experiences to diversify and personalise the resort encounter, with vacation clubs gaining increasing acclaim. In Mexico alone, approximately one third of resorts incorporate 30 Q 3/Q 4 2 01 7
a vacation club element and there are 6,822 RCI members based in Europe who have chosen to purchase timeshare here. “Guests are looking for authentic experiences, from in-room luxuries and personalised services, to priority access and bespoke tours,” advises Alfonso Heredia, Vice President of Marketing, RCI Latin America. “No single experience will please everyone, so resorts are
ALFONSO HEREDIA VP Marketing, RCI Latin America.
JUAN IGNACIO RODRIGUEZ SVP Business Development and Operations, RCI Latin America.
GRACE SEPULVEDA Director, Sirenis Premium Travelers' Club.
LUXE LIFESTYLE: The Japanese restaurant ‘Ikebana’ and Makawi Spa at the Grand Sirensis Mattali Hills.
Putting the exclusive in all-inclusive “Twenty years ago, all-inclusives in Mexico were standardised, with similar daily buffets and nightly entertainment. Now we are witnessing a revival in the concept based on lifestyle encounters which build a greater perception of value,” said Heredia. Revived experiences at vacation clubs include unlimited à la carte dining and premium drinks, access to members’ only resort areas, butler services and discounted activities, from spa treatments to tours. “Vacation clubs were just starting out in 2005, and within five years the entry of major hospitality brands in Cancún and the Dominican Republic created massive growth,” said Juan Ignacio Rodriguez, Senior Vice President for Business Development and Operations, RCI Latin America. Rodriguez adds: “We support our affiliates, from planning and investment through to sales and marketing solutions. So far we have collaborated on more than 60 projects in Latin America. “This way, we can look at it from the members' perspective of what they want to experience. It comes down to expanding the box, not just thinking outside it.
Managing Director, Unlimited Vacation Club by AMResorts.
NORMAN MCPHERSON Corporate Sales Director, Legendary Vacation Club.
differentiating and segmenting their offering on a broader level to satisfy guests. “Continuing to differentiate and deliver additional benefits is a challenge made even more complicated when you consider there are more than 300 all-inclusive resorts in Cancún alone. “RCI provides a marketing consultancy service to assist developers in identifying strengths and opportunities, in creating a strategy to improve their position in the market, and in activating memberships and consolidating sales. “Over a lifetime our holiday needs change. Communicating all the lifestyle benefits to club members in alignment with their stage in the product lifecycle is essential to increase the value per member.” Flexibility to travel when, and with whom they wish, coupled with access to a world of exchange options, is an attractive benefit for club members. Add exclusive resort access, personalised all-inclusive packages, shorter term contracts typically ranging from five to 25 years, with no maintenance fees to pay – just an all-inclusive fee when they stay – and club members can enjoy vacation club experiences built on value, flexibility and freedom. Heredia adds: “You get what you pay for. Members are not always looking for the cheapest product, they look for value. Presenting them with all the benefits is how they perceive value and invest for the longer term.”
“The strength of the club is only as strong as the attention you pay to looking after the product benefits – and keeping pace with customer aspirations for new experiences,” advises Rodriguez. Sirenis Premium Travelers' Club Sirenis Hotels and Resorts has opened its doors to travellers for almost 50 years, and established the members’ only Sirenis Premium Travelers' Club in 2009. The club has 22,000 members across its portfolio of nine resorts in Mexico, the Dominican Republic and Ibiza. Premium and Platinum Collection memberships range from US $13,000 to US $160,000. “Quality is essential at Sirenis. It’s expected throughout the process, but it’s also flexibility our members want,” said Grace Sepulveda, Director, Sirenis Premium Travelers' Club. “Ninety-five per cent of clubs out there operate on a discount or savings premise, however we chose to focus on the exclusivity of the experience which has created a very successful business model for us. “Our members prefer to pay more to be part of something grander. The resort’s personal concierges and
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private butlers make it their priority to know each guest by name and anything they need before they check in. It all feeds into that higher level of personalised service.” Depending on the membership purchased at Sirenis, benefits include limo transfers, spacious suites with ocean views, a bundle of in-suite amenities and gifts, private in-room dining, exclusive resort area access, members’ only cocktail parties and discounts on spa treatments and other resort services. Flexible check-in days, durations and suite options are popular with club members at Sirenis – as is the digital technology used by the resort. New members receive an engraved iPad upon enrolment, which is pre-registered with the Sirenis Club app. “We want guests to have us in the palm of their hands 24/7 to access everything from our booking system to a personal agent. Our job doesn’t end when members leave our office, it is only just beginning,” said Sepulveda. Guests are pre-selected for club membership and out of 1,000 possible guests, just 25 are invited on the daily tour. This targeted approach generates closing rates close to 45 per cent. “Our sales are really strong and with six Sirenis resorts in Ibiza, naturally we want to replicate this in Europe.” Three years ago, the club conducted European operation feasibility studies, however the barrier to entry was European legislation, which requires purchase fees to be collected annually across the 25-year contract. “This goes against the grain of our proposition but I am confident that Sirenis Premium Travelers' Club would work really well in Europe. We have a lot of European members visiting our resorts in Mexico and the Caribbean and their response to the club is always positive.” Unlimited Vacation Club by AMResorts AMResorts operates sales, marketing and brand management services for six resort brands in Mexico, the Caribbean, Costa Rica and Panama. They are the fastest growing all-inclusive resort operator in the world with 52 resorts in six countries and 23 destinations. Since establishing Unlimited Vacation Club (UVC) in 2010, it now has 60,000 members. Membership prices range from US $3,000 to US $50,000. In addition to the flexibility and freedom that UVC guests enjoy, members also love the consistent quality across AMResorts. “Consistent brand experience is crucial for members. They know they will receive the same level of quality and experience they have been promised, wherever they stay. This has been key to our success,” said Jorge Herrera, Managing Director, Unlimited Vacation Club by AMResorts. Luxurious accommodations, award-winning and limitless gourmet dining, premium spirits packages, day to night entertainment, including live performances and themed events, all come as standard at UVC. Each resort brand also offers distinctive guest experiences, ranging from the budget-friendly Sunscape for affordable family fun, to the super luxe boutique resort Zoëtry for romantic getaways. Members can book additional experiences, from food and drink tours to sampling local culture and an authentic Temazcal sweat lodge experience. 32 Q 3/Q 4 2 01 7
“Our six brands prove overwhelmingly popular with US and Canadian travellers. We also offer more than 500,000 seats annually to fly members into our destinations, from more than 20 US gateways, which is a very important member benefit,” advised Herrera. UVC also offers 25 per cent off all-inclusive rates and other in-resort discounts and services for members. Looking to the future, Herrera also sees potential in Europe, particularly in the Canary Islands, however it’s not on the immediate horizon due to the steady growth of vacation clubs in Latin America and the Caribbean. “We have huge plans for expansion, adding another 20 resorts to our portfolio by 2019, including entry into Aruba and Puerto Rico, which are exciting new destinations for us.” Legendary Vacation Club Legendary Vacation Club features a collection of four all-inclusive Hard Rock Hotels in Vallarta, Riviera Maya, Cancún and Punta Cana – with two more in Riviera Cancún and Los Cabos opening in 2018 - plus the new luxury property, Hotel UNICO 20°87° in Riviera Maya. Established in 2012, the resort now has 40,000 members. The adults only UNICO 20°87° is centred on cultural immersion, differentiating itself as an all-inclusive redefined with a flexible ‘no itinerary necessary’ philosophy for guests to ‘revel in the moment’. The hotel showcases regular pop-up cultural events and programming, while its gastronomy programme is influenced by local, fresh ingredients. Menus are inspired by a roster of talented chefs, with celebrity Chef Bravo heading up the Rotating-Chef restaurant. This is combined with expert mixologists led by the property’s Executive Mixologist. The result is a multi-sensory adventure across AMRESORTS:
Zoëtry Montego Bay Jamaica Spa and Jacuzzi Terrace.
Mediterranean Restaurant and its luxurious pool with sea views.
WHERE DO THEY T R AV E L F R O M ? Sirenis Premium Travelers' Club 50% Canadian 20% US 20% UK 10% Mexico
Unlimited Vacation Club 70% US 20% Mexico 8% Canadian 2% Europe
Legendary Vacation Club 90% US 10% Latin America and UK
“We offer something that is hard to find – quality over included. We bought the land on the Yucatán Peninsula many years ago, which has facilitated increased investment in the experience by 40 per cent and allowed us to deliver UNICO – something unique.” When considering expansion into Europe, McPherson doesn’t predict huge potential for vacation clubs due to the economy, the geography and climate. He adds: “The likes of Mexico and the Caribbean are much more effective for delivering all-inclusive clubs and resorts due to climate and its geographical proximity to the US and Canada. The cruise model however is very successful in Europe as it offers the chance to experience multiple countries in one trip.” Home-grown growth “We’re seeing more frequent cases of resort concepts being developed around a destination. Brazil’s Beach Parks developments in Caldas Novas are centred on its thermal water surroundings, while the Mexican Riviera Maya with its paradisiac beaches and wide range of amusements offers something for people of all ages. The all-inclusive concept is endearingly popular and developers are now looking to grow Jamaica as a familyoriented destination,” says Heredia. “Even resorts in Mazatlán, which aren’t able to offer all-inclusive, are working with local restaurants to provide authentic dining options and add new dimensions to the holiday experience.” Consistent, unrivalled luxury and quality, plus authentic experiences, must come as standard for vacation clubs if they are to succeed within a market of switched-on, sophisticated travellers. As new resorts deliver their own unique spin on the lavish lifestyle, clubs are in a state of continuous evolution to adapt, define and differentiate according to their own sense of luxurious, flexible and exclusive experiences. The end result is proving to be worth it. R CI VEN T U RES 3 3
its five restaurants and six bars and lounges. Departing from the traditional all-inclusive, a stay at UNICO 20°87° includes a local host, and even select spa treatments and beauty salon services, select excursions, and unlimited golf. Norman McPherson, Corporate Sales Director for Legendary Vacation Club believes quality is something that should carry equal weighting throughout the resort. “Even the lobby is important as you don’t get the chance for a second first impression, so you have to achieve the wow factor,” he says. “Rooms and suites are equipped with current technology systems, outdoor hydro tubs and terraces, and are decorated with local handmade artisan crafts, while the hotel is adorned with art by up-and-coming Mexican artists. “We also provide aromatherapy and pillow menus, five signature culinary experiences to sample native culture, as well as a cigar lounge, two swim-up bars, expansive spa and fitness facilities and even specially designed rooms for allergy sufferers. In fact, everything we provide is centred on the guest experience and it all matters when you check into a quality hotel.” McPherson believes buyers have most of the content they need to make an informed decision to purchase before check-in. “Travellers already have an idea of quality and what we offer, so when they holiday with us we must surpass their expectations. Price doesn’t become an issue as the perception of added value is already there. “There is one thing that unites most of our guest couples, they are looking to connect with Mexican culture, they want to relax and enjoy good quality food and drink. Typically, they have sampled all-inclusive previously, but didn’t find the quality they were expecting from the experience.
A FINAL THOUGHT
Spotlight on Russia As the travel and tourism market evolves, VLADIMIR SUCEVAN, Global Chief Operating Officer of Absolute World Group, discusses the continued importance of Russia, as both a source market and a holiday destination.
PUT SIMPLY, THE ASPIRATION OF Russians to travel is immense. There is no denying that outbound travel has decreased in recent years, coinciding with the dip in oil prices and the weakening of the Ruble. Unfortunately, Russian nationals are earning less money – at the moment – but their desire to travel has not abated and those who have the money will continue to do so. Russians are known for being big spenders in the travel market and we should not underestimate the importance of attracting Russian tourists. In the past, Russian holidaymakers have favoured traditional destinations, such as Egypt and Turkey – due to their affordability and proximity to home. Spain and France are also consistently popular destinations, as well as many other European cities which promise the charm of history and culture that Russians typically enjoy. Due to geopolitical challenges in recent years, tourists worldwide have been forced to reconsider their travel patterns, and for Russian nationals, Asian destinations are currently more favourable, specifically: China, Vietnam, Indonesia, Thailand and Dubai. Obtaining holiday visas for these areas is also simpler, and I believe that Russian outbound travel to Europe would increase if visa restrictions were relaxed to make it easier for Russians to holiday within Europe. Political relationships between Russia, and Egypt and Turkey have begun to stabilise, and
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though Russian people are still cautious of travel to these areas, the fact that citizens are no longer forbidden from travelling to them is a positive indication. At the moment, Absolute World services 10 source markets in the Russian language, including, Barcelona, Vietnam, Málaga and Phuket, with many others in consideration, such as Cyprus, Dubai, Italy, Turkey, Egypt, Goa, and Mexico among others. In terms of sales, people like to be spoken to in their own language – it makes every step of the process easier, both for the business and the customer, from purchasing, to booking and all other transactions. As a holiday destination, Russia itself has plenty to offer and this is highlighted by the increase of domestic travel in recent years. We have the mountains, the sea, and resorts perfect for holidaymakers – including the yearround resort of Sochi, with its sunny beaches and of course the infrastructure of the 2014 Winter Olympics which make it a premier winter resort. We have seen great opportunity for investment in Russia as an up-and-coming holiday destination and, in particular, for the growth of a shared-ownership product here. We have identified the importance of a legislative framework to grow this industry while protecting all involved – and steps are in place to create such legislation.
VLADIMIR SUCEVAN Chief Operating Officer, Absolute World Group.
V L A D I M I R S U C E VA N Born in Moldova, Sucevan began his career in the tourist industry in Spain, where he now resides with his wife and children. He is the Co-founder of the Absolute World Group, a leading Asian property developer, resorts and hotels operator, and vacation club and fractional ownership company. Sucevan’s strong finance and management background underpins his leadership of a large workforce across Spain, the Canaries, Russia, Ukraine, Kazakhstan, Thailand, Dubai, China and Hong Kong.
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