Catégorie : Around the world

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Around the world Products and activities

Urban creativity in the spotlight!

Over half of the world’s population lives in urban areas. By the year 2050, this percentage is expected to climb to 70%, while in North America alone, it will reach 90%! City-dwellers are already exposed to a dizzying array of options when it comes to recreational activities, entertainment, socializing and experiences of all kinds. Harbour swimming, rooftop hiking tours and camping in a chic hotel are just a few eloquent examples of urban creativity. Often urbanites themselves, tourists want to experience the city as residents do, visiting their haunts and discovering their well-kept secrets. The following article provides a quick overview of initiatives outside Quebec that help define a city’s personality and make it more dynamic for residents and tourists alike.

Harbour swimming

Since 2002, following major investments to clean up the water, it has been possible to swim in Copenhagen Harbour, the former site of significant industrial activity. An area of the city’s waterfront has been completely transformed and its new uses now include swimming and boating. Wooden boardwalks outline the swimming areas and a boat-shaped structure is used as a diving platform. The facilities are very popular during the summer months.

 

Source: R&R Associates

Breathtaking experiences

Have you ever wanted to climb up a rollercoaster…on foot? A sculpture built in the city of Duisberg, Germany, lets visitors do just that. Eleven metres high, this walkway offers visitors a unique view of the surrounding area. Located on a knoll atop an old zinc production site, the work of art is composed of steel and zinc.

Source: Inhabitat

For the past several years, visitors have been able to explore the city of Stockholm from the rooftops. Participants in this very special guided tour must don a harness and pull a safety cable along with them as they stroll above the city and take in the fabulous views while listening to commentary from a guide. Talk about a unique memorable experience!

Source: Visit Stockholm

Also in Stockholm, sightseers can ride two spherical glass gondolas to the top of the Ericsson Globe, the city’s major indoor sports and entertainment facility. In operation since 2010, SkyView offers an incredible birds-eye view of the city, a little like the funicular on the Olympic Stadium Tower in Montreal.

Source: Visit Stockholm

Urban camping

In the heart of Brooklyn, New York, the site of an old airport is set to become the largest urban campground in the United States. The National Park Service is planning to create approximately 600 campsites, making this location the ultimate in urban camping.

To satisfy the desire for outdoor urban experiences and, more importantly, offer something out of the ordinary, some hotels are inviting their guests to sleep in a tent. At Affinia Gardens in Manhattan, people staying in suites can sleep in a tent on their terrace and enjoy a s’mores-making kit (marshmallows, chocolate and graham crackers). Many visitors think that camping out in the heart of downtown New York City seems like fun.

 

Source: USA Today Travel

A different way to discover art and history

The Arenc Grain Silo in the French port of Marseille, listed as a 20th-century heritage building, has been turned into a concert hall. While retaining the building’s original façade of half-cylinders, the renovation opened them up with large windows. The ultra-modern theatre can seat 2,000 spectators. Built in 1926, the colossal structure was saved from demolition in 1996 and protected by a heritage rating. Nicknamed the “Olympia sur mer” in reference to Paris’ famous music hall, the theatre opened in September 2011.

 

Source: Ministère de la Culture et de la Communication et TreeHugger

In downtown Rouen, France, a fake radar device signals pedestrians to slow down so they can appreciate the city’s urban heritage. Entitled “zone 3,” this amusing project was developed by an artist as part of the contemporary art festival, “Rouen impressionnée.” When people walk faster than 3 km/hour, the “radar” flashes to indicate that they are moving too quickly. The humorous installation is accompanied by an explanatory sign.

 

© AFP   Source: Cyberpresse

The idea of surprising people in their daily travels has also been taken up by another art festival. As part of Chicago’s Art on Track festival, artists invade the subway with their creations. One Saturday, a train car wound its way through the city disguised as a mobile garden, with its floor and seats covered with a thick layer of grass that invited passengers to take a seat.

Source: Inhabitat

Calling all creative cities!

The cities of Quebec are also engaged in urban creativity. Competition among destinations is fierce and the world is becoming increasingly urbanized. To make our cities stimulating places to live and attractive destinations to visit, we must encourage artists, designers, architects and other creative thinkers to contribute to their growth and development (See: La créativite au service du développement urbain compte rendu de conférence).

 

 

Sources

– Agence France-Presse. «Un radar pour inviter les piétons à ralentir…», cyberpresse.ca, november 15, 2011.

– Glow, Justin. «Floating Swimming Pool Spotted in Germany», www.gadling.com, july 17, 2007.

– Guyennon, Patrick. «Marseille: un ancien silo à grains transformé en salle de spectacle», Urbanews.fr, september 22, 2011.

– Gwiazdzinski, Luc. «Ephemeral, Festive and Event-orientedCities», présenté à l’occasion de la table ronde intitulée New Times, New UrbanTourism Destinations du séminaire Urbantourism, heritage and urbanquality in Europe à Rennes, march 2009.

– Hattam, Jennifer. «Huge New Urban Campground Planned for Brooklyn», www.treehugger.com, june 15, 2011.

– Jones, Charisse. «Hotels offer visitors a chance to snooze under the moonlight», USA TODAY, agust 1st, 2011.

– Morgan, Helen. «Germany’s Roller Coaster Walkway Thrills Visitors with Views to The Surrounding Landscape», inhabitat.com,  november 20, 2011.

– Trendwatching.com. «CityLights», Trend Report 2012, november, 2011.

– Zimmer, Lori. «Chicago Subway Train Transformed Into Lush Mobile Garden on Wheels!», inhabitat.com, september 19, 2011.

Websites

• Badeschiff

• Skyview

• Stockhlom Roof Top Hiking

• World Urbanisation Prospects:

 

 

Catégories
Accommodation Around the world

Albergo diffuso: An alternative form of hospitality

Buildings located in historic areas are given a second life as they welcome visitors eager to learn about and experience local culture. This is the albergo diffuso, an Italian concept that combines the very old with the contemporary.

Concept

An albergo diffuso is a type of accommodation that offers the services of a traditional hotel along with a space that is like a rented private home. One of the special features of this Italian concept is its horizontal structure, which spreads the hotel services over several buildings. For example, the guest rooms and apartments may be located on different streets in the same neighbourhood, while the reception area is located in location X, the restaurant in location Y and other services in location Z, all within a 200-metre radius.

International publications have sometimes described the concept as a hotel-village.

Source: Villa Retrosi

Another distinctive feature of the albergo diffuso is the age of the buildings that compose it. In fact, one of the goals of the concept is to repurpose abandoned buildings, houses and even monuments. The idea is not to build anything new, but to reuse.

 

Source: Castello di Montignano Relais & Spa

The guidelines of the albergo diffuso model respect the values of sustainable development in many respects:

  • Promote local culture: one reason visitors select this type of accommodation is to enjoy an authentic local experience.
  • Stimulate the local economy: the creation of an albergo diffuso encourages one or more homeowners to participate in an organization that is usually a cooperative and supports the development of small businesses working in traditional sectors like handicrafts and food preparation.
  • Protect the environment: preserving existing buildings and giving them a second life helps safeguard the area’s history and limits the environmental damage that could be caused by new construction.

This type of hospitality is also reminiscent of the old European tradition of hosting tourists in homes.

An increasingly structured concept

To be able to call itself an albergo diffuso, an accommodation must meet several conditions, summarized as follows:

  • The idea must be launched by local stakeholders
  • Hotel services (reception, restaurant, etc.) must be provided
  • There must be a sole management entity: a single entrepreneur or any other efficient form of association, with a cooperative being the most commonly used form
  • There must be a minimum of seven rooms, located within 200 metres of each other and made available for a period of at least nine years
  • The town or village where the albergo diffuso is located must offer a minimum of services such as a pharmacy, grocery store, etc.
  • The albergo diffuso must take root in a lively, welcoming community that is open to sharing experiences with visitors

 

In the past few years, an association, the Associazione Nazionale Alberghi Diffusi (ADI), has been founded to help its members market themselves. At the same time, the Scuola Internazionale di Specializzazione in Albergo Diffuso, a school specializing in albergo diffuso, offers seminars, training and tools to assist property owners, management companies and local communities who are implementing this concept in their area.

Examples

The tiny medieval village of Smerillo is a centre of poetry that hosts the festival Le Parole della Montagna (“the words of the mountain”). Since 1998, the local authorities have been inviting certain homeowners to renovate their properties so they could be part of an albergo diffuso. Despite its population of 400, Smerillo can accommodate 60 visitors.

Source: Smerillo Albergo Diffuso

Le grotte della civita is an unusual example of the albergo diffuso concept; the 18 rooms are located in hillside caves! The goal of this albergo diffuso was to conserve Matera, a historic Apennine village in central southern Italy, and preserve its local heritage.

Source: Le grotte della civita

An exportable concept

The albergo diffuso model may be copied in other countries by adapting it to the host region. Moreover, the Business Innovation Centre of the Lazio Region, BIC Lazio, and the ADI offer technical assistance to the various countries that would like to implement this approach.

Will the albergo diffuso concept make its way to Quebec? It would be one way to revitalize certain villages affected by the rural exodus, repurpose some of the buildings from our religious heritage or even develop a network of accommodations in Quebec’s Far North.

—————————————

 

Comment – Giacomo Del Chiappa

Albergo diffuso represents a particular type of hospitality which help to achieve a sustainable tourism development (economic, environmental and sociocultural) of area that usually are abandoned. Indeed, albergo diffuso is usually considers as a way to recover the competitiveness of rural area which are interested by progressive flows of people leaving the rural area (emigrating) attracted from the more sparkling urban area. By this way, albergo diffuso is consider as a way to achieve a sustainable tourism development, creating job opportunities for local people, recovering the builindings, allowing to preserve and exploit the local authenticity and identity thus having the possibility to satisfy the needs of those travelers, the so called responsible tourists, (even more numerous) that travel looking for the possibility to be in touch with local authenticity, identity and culture in its various espressions (food, wine, cooking style, handcraft, etc) . Several examples could be done. One of this is Santo Stefano Sessanio located in the “Gran Sasso” national park in Abruzzo region. There everything is done to preserve local authenticity: research was done to understand how the old house were built, rooms has wool mattresses made as in the past and embroidered sheets accordingly the local traditions. Acccording with Kihgreln, the architect who developed this albergo diffuso, today the real estate in the village has been tripled.

 

Giacomo Del Chiappa – Assistant Professor in Marketing, Faculty of Economics, University of Sassari
Giacomo Del Chiappa received a Ph.D in “Marketing and Business Administration” at the Faculty of Economics of the University of Milan-Bicocca. He was Visiting Scholar at the University of Melbourne (Australia). He is Assistant Professor in Marketing at the University of Sassari, Faculty of Economics. He teaches in the areas of “Tourism Management and Marketing” and “Destination Management” for the Degree in Tourism Marketing and Management, based in Olbia (Sardinia). He is a member of the editorial board of the journal “Tourism Analysis” and referee for international journals. His research topics are related to destination governance and branding, convention site selection criteria and meeting industry and, finally, consumer behavior in tourism. In this latter field his studies are concentrated on responsible tourism, on web 2.0 in the hospitality sector and, finally, on community-based tourism. Fields of expertise:

  • Destination governance and branding
  • Convention site selection criteria and meeting industry
  • Consumer behavior

Organization Web site

 

Sources:

• Giordano Dichter, Giancarlo Dall’Ara. “Albergo diffuso – Developing tourism through innovation and tradition.”

• Marinela Dropulic, Aleksandra Krajnovic, Pavlo Ruzic. “Albergo diffuso hotels – A solution to sustainable development of tourism,” March 2008.

• M. Droli, S.I.S.A.D®. (International School Specializing in the Albergo Diffuso). “The albergo diffuso in Italy – The strengths of Friuli Venezia Giulia and innovative proposals,” March 22, 2007.

• Michèle Prévost, “L’hôtel diffus – Un concept d’hébergement rural qui se développe en Italie.” Espaces 295, September 2011.

 

Websites:

• Associazione Nazionale Alberghi Diffusi

• Bic Lazio

• Scuola Internazionale di Specializzazione in Albergo Diffuso

Catégories
Around the world Sustainable tourism

A portrait of Québec’s tourism sector in 2009 in its path towards sustainable development

The need to develop tourism based on sustainability principles is a part of a general tourism policy framework since 2005 in Québec(1) and most tourism sub-sectors also have set broad objectives based on this basis, including the Ski-doo Federation (2). Although sustainability is well accepted across Québec’s tourism sector, in practice it is not a central part of it, even though many businesses and organizations have implemented numerous measures to improve their performance. In this context the action of a few appears ad-hoc.

Collaborative Initiatives

To date none of the 21 tourism regions had produced a comprehensive regional scale sustainable development strategy with a clearly articulated vision, set of achievable short and long-term objectives and progress measure indicators. Yet, tourism is an important economic activity in Québec and in 12 regions it directly generates at least 3% of all income (3). Tourism has much more potential to be sustainable, since most regions have rich natural and cultural resource bases and diversified economies. Although natural resource exploitation forms the foundation of many regions across Québec, there is much untapped potential to expand tourism in these areas, thereby achieving greater economic integration. Untapped potentials also remain between biodiversity conservation and tourism development on private and public lands besides the protected area networks managed by the Provicial Parks Authority, la Sépaq and Parks Canada.

In some regions such as the Laurentians, concrete initiatives have been undertaken towards strategically integrating tourism into the regional economy through the Provincial Government’s Accord Program (4). In other regions a shift towards increased collaboration between stakeholders is occurring by the establishment of various cooperatives. Examples include the Lac Saint Pierre Biosphere Reserve (5), l’Échappé Bleue (6), Le Parc Aventures Cap Jaseux (7) and V.E.R.T.E. cooperatives (8). There are probably numerous other locally driven projects, but to nobody has examined their socio-economic value or general importance.

There are also 23 territorial areas across Québec with Local Agenda 21 (LA21) strategies (9) and one of the best examples with a strong tourism orientation includes the municipality of Baie-Saint-Paul. There, an LA21 process and willingness and leadership by certain stakeholders continue to enable greater community interaction as part of the redevelopment planning of Le Massif Resort (10).

Operational Changes to Improve Performance

Some tourism operations have a longer history of functioning according to sustainability ideals such as the Le Baluchon rural resort (11) and the zoos in Granby and Saint-Félicien (12, 13). However, very few businesses have a transparent Corporate Social Responsibility strategies, such as those published by the Granby Zoo(12) and Transat AT (14). Many tourism operations have reduced their energy and water use and waste output via different mechanisms, but their overall impact is not evaluated. Hotels in Québec seem to be making visible progress, especially since the Québec Hotel Association has its own Reser-Vert certification program (15), and the CITQ also recently modified its rating system to include environmental considerations and carries out checks on behalf of the Canadian Hotels Associations of Green Key rated establishments (16). Since recent years, numerous events including conferences and festivals are increasingly organized as ecologically and socially responsible, such as Montreal’s International Jazz Festival (17). Many other tourism operations also have supply chain management policies and source various products locally and or produced responsibly. Abitibi-Témiscamingue is the first ‘green’ Tourism Region awarded by Recyc-Québec for achieving more than 80% waste recuperation for its office operations (18).

Besides environmental efforts, some tourism businesses are also making contributions to improving north-south relations. For example, L’Auberge l’Autre Jardin (19) has been directly providing financial benefits to developing countries via its support of Carrefour Tiers Monde. Similar actions can be observed by Parc Safari that sells fair-trade products from developing nations (20). Sustainability news about small and medium enterprises (SME) in Québec is not well documented, which suggests limited progress. Since SMEs comprise about the majority of the tourism industry (21), it might be worthwhile to examine their progress, and issues so that appropriate tools could help them implement change towards sustainability.

Quebec’s tourism includes a variety of products to help reduce its greenhouse gas emissions such as a vast bike network developed by Vélo-Québec (22), the Bixi bike in Montreal (23) and the bio buses in Old Quebec and Montreal (24). Some businesses and events are also carbon neutral, but their profiles and numbers has not been documented. For example, Karavaniers du monde is the first tour operator in Quebec to include the cost of carbon offsets in its pricing (25). Climate change does not seem to be a preoccupation of the Quebec tourism sector, despite the vulnerability status of some products notably ski, snowmobile and various other outdoor activities (26).

Some sub sectors in Québec have a long history of encouraging businesses and visitors alike to reduce their environmental impact, notably Québec’s Adventure and Ecotourism Association (27). How many visitors to and from Quebec travel environmentally consciously is not known. Undoubtedly Québecois travelers are increasingly ethically minded. Since 88% of tourists in Québec are of domestic origin, consumers locally need more indication about industry’s progress so they can choose responsibly (28).

Where to next?

Various operational changes to improve environmental and social performance of the tourism sector are occurring at all scales, but nobody knows the real progress in the absence of benchmark indicators. Québec is not ahead nor behind other Canadian Provinces but there has not been a national study to compare progress at this scale. Québec’s tourism sector is in the beginning phase of operationalizing sustainable tourism and the above examples highlight the need for a Provincial scale action plan combined with a set of feasible progress indicators.

The support tools and knowledge network to put sustainable tourism principles into action is growing across Québec, and numerous institutions offer special training to improve human resource capacity, in responsible environmental managers that is directly applicable to tourism (29).

There is also a growing amount of effective tools and mechanisms reported from outside Québec to help implement change rapidly and help sustain a viable and responsible industry sector. However, local leadership remains an important key driver to implementing any action plan. There needs to be more leadership from government and industry to move the fragmented sub-sectors forward and to provide a coordinated approach to the entire process in Québec. The tools are wide ranging, and many remain unexplored potentials in Québec, including financial incentives and voluntary measures.

Sources:

1. Ministère du Tourisme du Québec (2005) Towards a Sustainable Tourism. Tourism Policy of Québec. Governemenet du Québec: Québec City. 37 p.

2. La Fédération des clubs de motoneigistes du Québec (2008) Plan d’action quinquennal de la FCMQ pour l’environnement. La Fédération des clubs de motoneigistes du Québec (FCQM): Montreal. 8 p.

3. Sauvé, R. La reconnaissance de l’industrie touristique dans l’économie locale et régionale. Presentation at the International Symposium on the Sustainable Development of Tourism. March 17 to 19, 2009. Québec City, Canada. Available at: http://www.bonjourquebec.com/mto/activites/symposium-developpement-durable/fr/programme-mercredi.html

4. Ministère du développement Économique Innovation et Exportation. Accord Program. Last accessed 14 April, 2009. [http://www.mdeie.gouv.qc.ca/index.php?id=3715]

5. La réserve mondiale de la biosphère du Lac-Saint-Pierre. Coopérative de solidarité de la réserve mondiale de la biosphère du Lac-Saint-Pierre. Last accessed 14 April, 2009. [http://www.biospherelac-st-pierre.qc.ca/content/cooperative.html].

6. L’Échappé Bleue. L’Échappée bleue. Coopérative de Tourisme durable. Last accessed 14 April, 2009. [http://www.lechappeebleue.com].

7. Le Parc Aventures Cap Jaseux. Qui sommes-nous. Last accessed 14 April, 2009. [http://www.capjaseux.com/-Qui-sommes-nous-.html].

8. La Coop V.E.R.T.E. Qui nous sommes? Last accessed 14 April, 2009. [http://www.coopverte.com/coopverte/index.php?option=com_content&task=blogcategory&id=19&Itemid=37].

9. Gagnon, C. and E. Arth. Guide des Agendas 21e siècle locaux. Les Agendas 21e siècle locaux québécois. Last accessed 14 April, 2009. [http://www.a21l.qc.ca/9544_fr.html].

10. Le Massif. Territoire Le Massif. The development project. Last accessed  14 April, 2009. [http://www.lemassif.com/en/territoire_le_massif/the_development_project.php].

11. Le Baluchon. About the Baluchon. Last accessed 14 April, 2009. [http://www.baluchon.com/inn-accomodation/index_ang.cfm].

12. Zoo Granby (2006) Réalisations en responsabilité sociale et environnementale. Zoo de Granby: Granby. 24 p.

13. Zoo Sauvage de Saint-Félicien. Au sujet du CCBB/Zoo Sauvage. Last accessed 14 April, 2009. [http://www.borealie.org/page.php/fr/1/4.htm].

14. Transat A.T. (2008) Transat for Sustainable Tourism. 2008 Corporate Social Responsibility Report. Transat AT Inc: Montreal, Québec. 44 p.

15. L’Association des hôteliers du Québec. RéserVert, le Programme de reconnaissance en développement durable. Last accessed 14 April, 2009. [http://www.reservert.com/fr/page.php?label=r%E9servertleprogramme].

16. Corporation de l’industrie touristique du Québec. CITQ is mandated by the Hotel Association of Canada for the Green Key Eco-Rating Program visits. Last accessed 14 April, 2009. [http://www.citq.info/EN/classification.asp].

17. Festival International de Jazz de Montréal. Une édition 2008 carbon neutre. Last accessed 14 April, 2009. [http://www.montrealjazzfest.com/Fijm2008/planetAir_fr.aspx].

18. Bisson, K. Là où commence un tourisme plus vert. Last accessed 16 April, 2009. [http://lafrontiere.canoe.ca/webapp/sitepages/content.asp?contentid=87930&id=836&classif=].

19. L’Auberge Autre Jardins. Mission et historique. Last accessed 15 April, 2009. [http://www.autrejardin.com/auberge.php].

20. Ranger, J.-P. Tourisme durable. Parc Safari. Presentation at the International Symposium on the Sustainable Development of Tourism. March 17 to 19, 2009 Québec City, Canada. Available at http://www.bonjourquebec.com/mto/activites/symposium-developpement-durable/fr/programme-mercredi.html

21. Ministère du Tourisme du Québec. Programmes et services aux entreprises touristiques. Last accessed 15 April, 2009.  [http://www.bonjourquebec.com/mto/ministere/index.asp].

22. Laraue, S. Tourisme durable et velo. Presentation at the International Symposium on the Sustainable Development of Tourism. March 17 to 19, 2009 Québec City, Canada. Available at http://www.bonjourquebec.com/mto/activites/symposium-developpement-durable/fr/programme-mardi.html

23. Montreal Tourism. BIXI: Montreal’s Brand New Public Bike System. Last accessed 15 April, 2009. [http://www.tourisme-montreal.org/Press/Whats-hot/News/bixi-montreal-s-brand-new-public-bike-system].

24. Société de Transport de Montréal. For one year, 155 STM buses to run on biodiesel in downtown Montreal (Press Release). Last accessed 15 April, 2009. [http://www.stm.info/English/info/a-biofiche.htm].

25. Karavaniers du monde. Cuba. Mère des Caraïbes. Informations Techniques. Last accessed 15 April, 2009. [http://www.karavaniers.com/voyages/calendrier/?voyage_depart=134].

26. Singh, B. and C. Bryant (2006) Impact et adaptation aux changements climatiques pour les activités de ski et de golf et l’industrie touristique : le cas du Québec. Rapport préparé pour Ouranos Inc. Département de géographie, Université de Montréal: Montréal. 404 p.

27. Aventure Écotourisme Québec. Leave No Trace Program. Last accessed 15 April, 2009. [http://www.aventure-ecotourisme.qc.ca/content/templates/content_en.asp?articleid=46&zoneid=10].

28. Tourisme Québec (2009) Le tourisme au Québec en bref – 2007. Ministère du Tourisme du Québec: Québec. 16 p.

29. Villeneuve, V. Chaire en éco-conseil. Last accessed 15 April, 2009. [http://www.uqac.ca/recherche/organismes/chaire_ecoconseil.php].

Catégories
Around the world etourism and technology Management Marketing @en

Interhome: a good example of best practices

At the 2007 ITB Berlin Trade Fair, Simon Lehmann, CEO of Interhome, spoke on the topic of Customer Relationship Management (CRM), an approach adopted by Europe’s largest holiday rental accommodation agency. The impressive results testify to CRM’s undeniable impact when used in conjunction with a personalized marketing strategy.

What is CRM?

The goal of CRM is to collect as much information about one’s clients as possible, and to combine these individual pieces of information into targeted, personalized marketing initiatives in order to recruit and retain clients and encourage them to spend more.

Interhome and the reassessment of previous practices

Interhome has offices in 20 countries. Each year, it rents over 20,000 vacation homes and apartments to over 500,000 guests, for over 7 million overnight stays and sales of 120 million euros. In order to promote an inventory of this size to such a large number of potential clients, Interhome uses a variety of communication, promotion and sales methods including distribution networks, advertising, a sales force, catalogue, and the internet. Although the company’s management team believes this number of methods is unavoidable, it is also convinced that using them prevents it from developing an accurate assessment of the profile and habits of its clients.Reflecting on this fact, Interhome’s managers began to ask themselves whether the impressive catalogues listing all the available homes were, in fact, relevant or effective. Producing them involved costs which were not necessarily offset by the relatively low reservation (or conversion) rate. The company also realized that client‑related information was distributed throughout a number of databases.

Know your client

It was then that Interhome decided to invest in CRM in order to consolidate and improve its client‑related information. This new database stores three different kinds of information:

  1. history of the consumer’s contact with the company (catalogue orders, reservations, comments and complaints, etc.);
  2. data collected during each consumer contact (visiting the site, requesting information, reserving a home, etc.) regarding his/her vacation preferences;
  3. complementary information obtained via surveys (lifestyle, purchasing habits, household composition, habits and leisure activities, etc.).

Thanks to this information, Interhome was able to develop a system that creates a profile for each customer. These profiles list the customer’s profile, his/her loyalty index and the complete history of his/her interactions with the company.

FGC_2007-07_interhome_img1

  • prior expenditures
  • preferred destinations
  • preferred travel periods
  • favourite type of accommodation
  • family situation: number of children and their ages
  • leisure activities, interests and motivating factors
  • preferred method of communication

CRM enables companies to gather the information they need to create detailed consumer profiles which they can then use to implement marketing strategies based on personalized offers.

1‑to‑1 marketing

In order to bring consumer preferences in line with their offer, Interhome developed a new method of classifying residences based on the client’s stated preferences: spa, family, sports, comfort, pleasure, rest, snow and dream destination. Interhome analyzed the client profile in order to identify the product categories likely to interest him/her. It then analyzed the characteristics of each vacation home (location, accommodation capacity, price, availability, etc.) so it can propose to each of its clients places that are perfectly suited to their preferences. Henceforth, instead of receiving an exhaustive catalogue, the client receives a brochure listing no more than 8 prospective residences that both fulfill his/her requirements and are available during his/her preferred travel periods. This also enables Interhome to prioritize homes that will generate the highest profit margins.

FGC_2007-07_interhome_img2

This personalized brochure is either mailed or e‑mailed depending on the customer’s stated preferences. Automatic follow‑ups are generated by the system and all reservations can be made through Interhome’s website. It goes without saying that all action (requests for information, reservations, etc.) generated by this mailing will be added to the client’s profile, thus further increasing Interhome’s effectiveness.

Telling results!

Lehmann emphasized that the cost per reservation is 10 times lower with the personalized, or “1 to 1” marketing approach than it is with the undifferentiated, catalogue approach. Some of the results he mentioned are as follows:

  1. a 30% reservation rate following a request for information (as opposed to a 7% rate with the catalogue);
  2. the average rate is one reservation for every 12 direct mail messages, a higher‑than‑average conversion rate for direct marketing;
  3. significant savings on postage, since two‑thirds of mailings are done electronically;
  4. a savings of 500,000 euros on the cost of printing catalogues;
  5. because the company was able to prioritize homes that would generate the highest profit margins as well as profitable complementary sales (transportation, car rentals, ski tickets, trips, packages, etc.), revenue per reservation increased by up to 30%;
  6. every year, over 200,000 new client‑related information items are added to the database.

During his presentation, Lehmann did not reveal how much his company spent to develop such an effective CRM system but the results he presented lead one to believe that the move was a profitable one.

Will other tourism companies follow suit?

Many tourism companies have already gathered a significant amount of information about their clients and a number of these companies would probably benefit from adopting the same type of CRM that Interhome did. After all, client data is a gold mine; once data is collected, all the company has to do is put the data to work to make its marketing efforts more targeted and effective. Source: * Lehmann, Simon, “Best Practices in CRM & Personalisation, 1 to 1 Marketing @ Interhome,” PhoCusWright conference – ITB Travel Technology, Berlin, March 8, 2007.

Catégories
Accommodation Around the world

Getting Out of the Hotel Business and into the Business of Hotels

Our expert, M. Michael Nowlis from Tourism Control Intelligence, traces three related trends that have revolutionized the global hotel industry over the last 25 years.

It begins by chronicling the emigration of hotel assets from American ownership to foreign investors in the 1980s and their subsequent repatriation starting in the mid-1990s. Second, it examines how the management focus of large international hotel groups has shifted from a real estate orientation to an emphasis on brand management. Finally, the article explains how this business reorientation resulted from the increasingly shorter planning horizons of global investors.

The Great American Sell-off

Recent reports in the press speculate that InterContinental Hotels Group (IHG) will be the target of a US$ 11.2 billion takeover bid in the coming months. The stratospheric price tag stuns even seasoned industry analysts who have followed hotel mergers & acquisitions for decades. IHG has an impressive portfolio of internationally recognized brands – InterContinental, Holiday Inn, Crowne Plaza and Indigo among others. The company is well diversified in terms of market segments and global coverage. Nonetheless, IHG’s 60% increase in share price from August 2006 to January 2007 raises numerous issues concerning market speculation, quality of management and company financial fundamentals. Industry analysts predict an American REIT (Real Estate Investment Trust) or private equity group will make an unsolicited offer of 1500p for outstanding IHG shares during the first half of this year. Such an offer would represent an 80% premium over the August share price (840p) on the London Stock Exchange.

An IHG takeover would be significant for reasons in addition to the lofty price. The two most frequently cited contenders are US investment firms – Barry Sternlicht’s Starwood Capital and the Blackstone Group, a private equity firm with extensive hotel assets. The acquisition of IHG by American investors would bring the international hotel industry full circle, reestablishing North American dominance in the global lodging sector.

The American withdrawal from international hotel markets began in 1981 when Pan American Airways sold its InterContinental division to Grand Metropolitan, a British food and hotel group. The sale sparked a prolonged sell-off of North American hotel companies to foreign investors. Most notably, Holiday Inn, the world’s largest hotel company at the time, was sold to England’s Bass Brewing Company in 1987.

The InterContinental sale sparked another trend that would radically transform the travel industry over the coming years. Airlines began to shed their hotel assets to focus on core transportation activities. Within a period of a few months in 1987, Chicago-based United Airlines sold its Hilton International, Westin and Camino Real hotel subsidiaries to British and Japanese investors. In the following years, all of the world’s major airlines liquidated their lodging divisions. Travel industry executives came to reject the conventional wisdom that airlines and hotels, operated by the same company, were strategically complimentary business units.

Asian investors were particularly eager to acquire American hotel groups. Hong Kong-based New World Development purchased the Ramada International, Renaissance and Stouffer’s hotel companies. Regal, another Hong Kong group, acquired Richfield, one of North America’s largest management companies with a vast portfolio of hotels flying Sheraton, Hilton, Choice and Holiday Inn flags, among others. Dubai’s Kingdom Hotel Investments went on a Canadian shopping spree, picking up Delta and CP Hotels, as well as taking significant positions in Four Seasons and Fairmont.

While Asians were focusing on the luxury segment, French investors turned their attention to the US budget sector. With its purchases of Motel Six and Red Roof Inns, Groupe Accor acquired more than 1000 lodging establishments in the US and Canada.

As one hotel company after another was sold to foreigners, North American investors were accused of an obsessive focus on short-term profits. Analysts claimed that Asian and European investors with longer planning horizons would reap handsome returns further down the road. American impatience, it was argued, was allowing foreign investors to purchase the crown jewels of the global hotel industry at prices that were likely to appreciate at supernormal rates of growth.

Coming Home

Just as the American sell-off appeared to have reached the tipping point, a curious thing happened. In 1994, a group led by little-known Starwood Capital and Goldman Sachs purchased Westin from the Japanese Aoki group, returning the company to US ownership. While Aoki had liquidated some non-strategic assets, the $537 million selling price was approximately a third of what the Japanese had paid United Airlines for the company in 1988. Analysts claimed the Westin takeover was an opportunistic acquisition that did not portend a trend in hotel asset repatriation. It did not take long, however, to prove them wrong.

In 1997, Marriott purchased Renaissance, Ramada International and New World Hotels from their Hong Kong-based proprietors. More recently, Hilton Corporation bought Hilton International, its British based namesake, for $5.7 billion. The Hilton acquisition reunited the company 42 years after the international division had been spun off to Trans World Airlines and nearly 20 years after it moved its headquarters to the UK.

American investors are not known for tiptoeing into business markets any more discreetly than the US Army tiptoed into Baghdad. Such was case with their return to international hotel investment. Not satisfied with merely reclaiming « American » hotel companies, US investors went on a shopping binge, acquiring a vast array of international lodging firms. Sheraton purchased CIGA, the Rome-based company that maintained a virtual monopoly on Italy’s upscale hotel market. The Carlson Companies, parent of Radisson Hotels, purchased Regent International, the Hong Kong-based hotel group that had established Asia’s reputation for luxury hotel keeping. Starwood picked up Le Meridien Hotels, a chain founded by Air France and sold to British interests in 1994. Starwood also acquired Hotels du Louvre, Europe’s 2nd largest hotel company which included the upscale Concorde brand.

Shorter Investment Planning Horizons

Have American capital markets given up short-term investing to concentrate on long-term asset appreciation? Nothing could be further from reality. The return of US dominance to hotel equity markets manifests the economic globalization of international investment activity in general. Investors of all nationalities are calculating risk and return for increasingly shorter planning horizons. In uncertain times, why would Hong Kong investors wait several years for investment returns when the Shanghai Composite Index was up 122% in 2006? Bourses in Peru, Vietnam and Venezuela appreciated at168%, 144% and 156% respectively last year. In the interconnected and interdependent world of the 21st century, investors from Albania to Zambia are using the same investment criteria to identify the most lucrative opportunities in global markets. Calculations no longer focus on the net present value of expected cash flow for decades to come. The key is to assess appreciation of asset values (real estate or management contracts) next year or even next month.

The Hotel Washington in the US capital provides an illustrative case study of this trend. Gal-Tex, which owned the hotel for 65 years, sold it to Westbrook Partners for $120 million in the spring of 2006. Barely six months later, Westbrook turned the property over to Istithmar Hotels for $150 million, reaping more than $1 million profit for each week it had owned the hotel.

The Savoy Group in London provides an even more astonishing example of such rapid-fire turnover of trophy assets. The Savoy Hotel and its three sister properties with a total of 772 rooms were purchased by the Irish investment group Quinlan Private in May 2004 for $1.36 billion. The 226-room Savoy Hotel was valued at approximately $380 million at the time of sale. Within a few months, Quinlan sold the Savoy to Kingdom Hotel Investments for a reported price of $475 million. Measured by the $1.8 million per room price tag, the sale represents one of the highest prices ever paid for a hotel. While Quinlan had been widely criticized for overpaying for the Savoy Group, the acquisition provided a $95 million profit on the sale of just one hotel that it owned for less than a year.

From Real Estate to Brand Management

The plethora of hotel transactions also manifests the value of non-tangible assets in the hotel industry. As lodging companies divest of real estate, the value of management contracts, franchise agreements and internationally recognized brands has become increasingly easier to assess. When Hutchinson Whampoa, the proprietor of the Hong Kong Hilton, demolished the hotel in 1995 to build a commercial office complex, it was obliged to pay Hilton $125 million to buyout the remaining 20 years of its management contract. In a bizarre paradox, the sum was not being paid to manage the hotel but rather to not manage the hotel. In testament to the potential value of a management contract, Hilton made clear that it did not want a payment of $125 million. The company preferred a continuation of the management contract. In the end, Hilton was legally obligated to vacate the premises and accept the settlement. The case illustrates, however, the radical changes that have turned the hotel sector upside down.

The growth of franchising has further altered the basic structure of the industry. While franchising of lodging establishments was pioneered by Holiday Inn’s standardized motels in the 1960s, only recently have upscale international groups been willing to permit owners to manage their hotels under a prestigious corporate banner. Almost all of the major international hotel companies now engage in franchising as a capital-free vehicle for rapidly growing their brands. The Carlson Companies have taken the concept to the extreme, having sold all of their hotels and given up most management contracts. The group now focuses almost exclusively on franchising its Regent, Radisson, Park Plaza and other hotel brands.

As hotel franchisers and management companies put increasing emphasis on international product recognition, brand management is becoming the critical skill for competitive advantage. This revolution has been manifested in recent years by the selection of brand management professionals (rather than hoteliers) to head the world’s largest lodging companies. Ian Carter, President of Black & Decker EMEA was appointed Chief Executive of Hilton International in 2005. When Hilton Corporation acquired the company the following year, Carter was the only top executive retained by the parent company, where he now serves as Chief Executive Officer for international operations.

Andrew Cosslett, President of Cadbury Schweppes EMEA, was named head of InterContinental Hotels about the same time Carter joined Hilton. The following year, the logic for hiring an executive from the confectionary industry to head a hotel company was explained in a CNBC broadcast. Interviewer Ross Westgate asked Cosslett, « Because you manage hotels now rather than own them – you’ve sold a lot of the assets off, so is it now brand management – is that essentially what you do? » The new chief executive replied, « That’s really our focus. »

When Starwood Hotels founder Barry Sternlicht decided to step down as Chief Executive Officer, none of the short-listed candidates to replace him were from the hotel industry. Steven Heyer, President of Coca-Cola was eventually recruited to assume the CEO position at Starwood, primarily for his branding prowess. Shortly thereafter, Starwood recruited Javier Benito, President of Coke’s US retail division to serve as the company’s Executive Vice President.

While peddling Coca-Cola in supermarkets may appear greatly removed from selling St. Regis suites on the web, the success of both depends on the effectiveness of brand management. The fact that executives with no hotel experience are increasingly recruited to manage the world’s largest lodging companies has significant implications for hoteliers, investors and educators. If branding skills are the most important qualifications for heading a global hotel company, what is the future of the industry? Where is the value in a hotel company?

Traditional hotel executives may scoff at such trends but stockholders are euphoric. The recent 60% rise in IHG share price has persuaded investors that hotel companies need a new breed of leader to maximize return on investment. If the IHG takeover bid is successful, providing stockholders an 80% share appreciation in less than a year, it will be difficult to argue with them.

Conclusions

The increasing divergence of hotel ownership (real estate), operations (management) and marketing (brand distribution) will intensify in the coming years. « Hotel management » will refer only to those activities that directly impact above-GOP (Gross Operation Profits) controllable expenses. Private equity funds, REITs and institutional investors are dominating the hotel real estate markets. Franchisers are achieving competitive advantage in sales and distribution. Increasingly, companies once considered at the core of the lodging industry are getting out of the hotel business and into the business of hotels.

Catégories
Around the world Customer segments

Loyal customers spend less than new customers

Spanish researchers have analyzed the expenditures of travellers in relation to how many times they have visited a destination. According to their findings, returning travellers spend less than first‑time visitors, primarily because of their increased knowledge of the destination. Destinations may want to consider the true economic benefits of new visitors versus loyal customers in relation to the money spent to attract them.

The advantages of loyal customers

In the tourism industry, regular customers are generally desirable for a number of reasons, in particular:

  • Marketing costs for attracting loyal customers are lower than those required to solicit new business.
  • A repeat customer usually indicates satisfaction with the product or service.
  • Customers who regularly return to a destination tend to encourage those around them to do the same.

In economic terms, destinations appreciate repeat visitors because they help stabilize market share, require lower promotional costs, and are less sensitive to price variations and potential service problems. However, another factor comes into play: returning travellers are more familiar with the destination and able to make more informed decisions when it comes to most travel expenses.

The Balearic Islands: A case study

Researchers Joaquin Alegre and Catalina Juaneda, from the University of the Balearic Islands, have attempted to analyze the relationship between consumer behaviour and repeat visits. The study looked at a sampling of German and British tourists vacationing in Spain’s Balearic Islands; many variables were analyzed, such as the number of visits to the destination and motivations like delivery quality.

In particular, the study examined the fact that first-time visitors are initially influenced by external factors, primarily the cost of the trip. Once destination quality proves to be a critical factor, high price is often seen as the best indicator of quality. As for repeat visitors, they are more motivated by factors linked directly to the destination, for example, hotel and service quality.

Not all tourists can be loyal

To clearly understand the context of repeat visits, it is important to realize that some tourism motivations run counter to destination loyalty. For example, for those who see travel as a break from routine (an opportunity for unique experiences and the discovery of new places, new people and other cultures) destination loyalty is not appealing. Travellers fitting this description would generally not be interested in revisiting a destination.

On the other hand, individuals with little tolerance for risk would feel comforted and relieved to return to the same place. This type of traveller usually seeks relaxation, comfort, a familiar environment, and a minimum of uncertainty and risk. Moreover, it takes time and effort to find and research a new destination, and money to set up new routines.

Differences observed

Why do first-time visitors spend more? Even if they have managed to compile a lot of information from travel guides or Web searches, it is very difficult to acquire intimate knowledge of local pricing realities. Given this lack of information (and more importantly, lack of first-hand experience), first-time visitors readily accept prices that may, in fact, not be considered competitive.

The study’s findings show that repeat visits to a destination have an influence on tourist expenditure patterns. The share of expenditures made in the home country of travellers who are visiting for the second or third time is 28% lower when compared to expenditures by new visitors. The difference is even more significant (32%) among tourists who are on their fourth or higher visit.

The impact of customer loyalty on consumer behaviour is even more remarkable when one looks at the amounts spent at the destination itself, during the vacation. Repeat visitors, regardless of how many times they have been, spend 40% less than first-timers.

Other motivating factors

Tourists who attach a great deal of importance to hotel quality tend to spend more on their vacations, both at home before the trip (+49%) and at the destination (+44%). People who consider the quality of their surroundings to be important also spend more, especially at the destination itself (+28%). A similar observation can be made about tourists who return to the same region, with expenditures of 17% more in the destination country.

The study findings also demonstrated the following:

  • Repeat visitors are more likely to opt for half-board lodgings, in other words, accommodations that include one or more meals.
  • Loyal tourists have a longer length of stay.
  • The more times tourists visit a destination, the more they tend to visit the same region.

Lessons learned?

A destination’s positioning should consider the proportion of new to return visitors. When a large percentage of one’s customers are not first-timers, it may be risky to promote services with a large mark-up. According to the study’s authors, increased profitability from unit sales will not be enough to compensate for an eventual decline in the number of visitors from a well-informed customer base.

Obviously, the example presented by the researchers covers only the case of the Balearic Islands (a sun destination) and is based on a restricted clientele, that of British and German tourists. However, the study’s authors conclude that their findings still apply to many destinations.

Sources:
– Alegre, Joaquin and Catalina Juaneda. « Destination Loyalty: Consumers’ Economic Behaviour, » Annals of Tourism Research, Vol. 33, No. 3, p. 684-706, 2006.
– Um, Seoho, Kaye Chon and YoungHee Ro. « Antecedents of Revisit Intention, » Annals of Tourism Research, Vol. 33, No. 4, p. 1141-1158, 2006.

Catégories
Accommodation Around the world

Luxury hotels now include… camping?

More and more travellers are turning to nature tourism, e.g. trips to unique sites, package tours and outdoor activities. However, these same consumers also want to enjoy comfort, safety and relaxation. Although these needs may seem incompatible, some hotels have successfully combined them by offering camping as part of their latest deluxe products!

A desire for nature and a simpler time

According to French sociologist Jean-Didier Urbain, the desire for nature is one of the primary « needs » generated by city life; the yearning for a natural environment is a reaction to an everyday life of streets and pavement. Furthermore, this phenomenon is likely to increase: it is estimated that by the year 2015, over half the world’s population will be living in cities, especially in the West. For tourism professionals, this nascent trend offers incredible potential.

For his part, sociologist Michel Maffesoli highlights the emergence of a « post-modern paradox »: the prevailing search for luxury, combined with a desire to return to the past. In other words, a desire to get back to the basics. Therefore, those who develop products cleverly combining luxury and nature seem destined for success.

Nature tourism

Defined by the World Tourism Organization (UNWTO) as a « form of tourism in which the main motivation of the tourist is the observation and appreciation of nature », nature tourism responds to the desire for nature by organizing access to exceptional natural environments. To complete the nature tourism experience, the tourism industry has had to develop accommodation solutions that provide a level of comfort to meet customer needs without « de-naturing » the natural environment of the host location. The creation of ecolodges is part of this trend.

Luxury meets nature

Having picked up on this trend – and not wanting to miss out on this market segment – the luxury hotel trade has drawn its inspiration from the tent, a type of lodging traditionally associated with the great outdoors. To attract urban travellers, luxury establishments are designing innovative accommodations that recreate the spirit of adventure so often associated with camping.

First Four Seasons camping site

To help travellers slake their thirst for direct contact with nature, the latest resort from the prestigious Four Seasons hotel chain offers 15 tent accommodations in the Golden Triangle of Northern Thailand. Each spacious tent features a unique décor, zippered doors and windows, a large bed, recycled teak floor, oversized copper bathtub, outdoor shower, high-speed internet access, a safe, and more. A « first » for the hotel group, this pilot project will be used as a benchmark for developing new camps in the future.

Interest on every continent

In 2005, the luxury Resort at Paws Up in Montana added « Tent City » to its product line, offering the American plan (all meals) for US$595 per night. Each tent includes a comfortable bed (fine linen and feather duvet) and artwork on the walls, while the nearby spa provides outdoor massages on the banks of the Blackfoot River, with essential oils from the surrounding region. The concept has been so successful that 6 tents and a new spa will be added in 2006.

In Australia, the Voyages Hotels and Resorts group, which manages 23 luxury resorts, opened Longitude 131°, a 5-star wilderness camp, on July 1, 2004. Located in the heart of a national park, this site -affiliated with the Small Luxury Hotels of the

World group, offers 15 elegant tents mounted on pilings, equipped with air conditioning and satellite television.

Not surprisingly, similar camps can also be found in Dubai (where the Al Maha Desert Resort is located in a 225 square km desert wildlife preserve) and in the Tunisian Sahara, a national park in Namibia as well as some natural sites in Bolivia.

The myth of the adventurer

Amused by the behaviour of city-dwellers wanting to re-experience the past while incorporating the comforts of the city, Jean-Didier Urbain notes that large tourism-based businesses are justified in using the terms « camp » and « camping », because they are referring to the consumer fantasy of being an adventurer. That being said, hoteliers nonetheless seem to have successfully created a promising new market niche by cleverly combining the desire for nature with a taste for luxury.

Sources:
– Hamam, Nadia. « Palais de toile sous les étoiles, » Madame Figaro [www.madamefigaro.fr], February 14, 2006.
– Maffesoli, Michel. ?Un désir de retour à l’archaïque,? Madame Figaro [www.madamefigaro.fr], February 14, 2006.

Catégories
Around the world Marketing @en Transportation

Adopting a leisure-orientated marketing mix: some challenges and opportunities for airports

This article aims to discuss some of the challenges and opportunities that are faced by airports when adopting a leisure-orientated marketing mix in order to attract leisure carriers (e.g. charter, low-cost or niche regional carriers) for tourism.

The format of the article is structured in a way that considers each of the four elements of the product marketing mix; the 4P's (product, promotion, price and place). Airports obviously offer a service (as opposed to a product) and so the three elements of the services marketing mix (processes, physical evidence and people) will also be considered but this will be done within the context of the 4P's as quite often, elements such as processes and people can be discussed within the context of the product. The main points of the article and areas for future research will be summarised in the conclusion.

The airport product

Airports wishing to compete in leisure markets need to be aware of the facilitation requirements of leisure carriers. Runway length, terminal capacity and landing systems will all contribute to the decision of whether or not to operate to a particular airport however; this applies to all types of carrier, not just those that offer opportunities for the development of tourism.

The level of infrastructure available at an airport will to a large extent determine the types of markets or carriers that can be targeted. For instance, only airports with a runway length of over 1600 meters can realistically target low-cost and charter carriers operating dense routes with a Boeing 737 or Airbus 319. Many of the airports in Europe's northern periphery have fairly long runways that were built for military purposes and can therefore accommodate the typical range of aircraft used by low-cost and charter carriers. Airports with smaller runways will need to target niche regional carriers operating thin routes with smaller aircraft.

The harsh operating conditions that are typically associated with Europe's northern periphery (e.g. frequent adverse weather and permanent obstacles such as mountains) may provide further constraints to some airports, especially those that are not equipped with modern landing systems and accurate real time weather monitoring, both of which have the capacity to improve airport safety and the reliability of flight operations.

Tangible infrastructure is a basic need of the airline and does not really provide much of a competitive advantage to airports, especially when competing airports offer a similar level of infrastructure. In such instances, airports should look to compete at the augmented level (where additional benefits can be offered).

Leisure carriers are especially focused on achieving low operating costs and an efficiency of operations. Therefore, they will want to see how airports can facilitate cost savings (e.g. by providing simple terminals and minimal services), speed (e.g. by providing fast aircraft turnarounds and an efficient positioning of aircraft), flexibility (e.g. by providing multi-functional and flexible staffing), and access (e.g. by providing longer opening hours and surface transport to the destination). Prestwick Airport in Scotland was able to adapt its augmented product in order to attract low-cost and charter carriers. The airport developed a multi-skilled workforce that is able to provide all airport services and a quick turnaround of aircraft. In addition, the airport made a conscious effort to reduce costs and to pass these savings onto their airlines and tour operators. In the first year of implementing such initiatives, Airtours (a leading tour operator) added seven new routes from the airport and the airports total number of annual passengers increased by over 30% (Lang, 1999).

For airports that target multiple carriers (e.g. traditional full-service or business charters in addition to leisure carriers), increasing consideration is given to whether or not to segment the product offering (e.g. by offering separate terminal facilities that offer different service levels to different types of carrier). Although not located in Europe's northern periphery, Marseille Airport in southern France is one of the first airports in Europe to offer and actively promote separate facilities for different markets. At Marseille Airport, airlines can choose whether to use a full-service terminal that offers airbridge access to the aircraft or a low-cost terminal that offers remote stand access to the aircraft. The principle here is that the user pays for a superior product.

Associated with the airport product is the idea of the airport brand. Branding has been widely used by airports in Europe's northern periphery and especially by those seeking to attract charter carriers. In this instance, the brand that is developed may be based upon natural or man-made attractions or aspects of historical importance. A few examples include Lakselv Banak Airport in Norway (now known as North Cape Airport), Kemi-Torino Airport in Finland (uses the logo 'For Golf in the Midnight Sun'), and Keflavik International Airport Terminal in Iceland (inaugurated in 1987 under the name of Leifur Eiriksson Air Terminal after the Norwegian navigator who, according to Norse sagas, was the first to discover North America). Airports have also been branded in a way that demonstrates their size or scope of services. For example, Prestwick Airport in Scotland is now called Glasgow Prestwick International Airport in order to create awareness of the fact that the airport offers international services.

Branding creates distinctiveness and adds tangible cues to what is essentially an intangible service. In addition, branding can promote recognition, preference and loyalty amongst target markets. However, branding can have a potentially negative impact by being too distinctive and encouraging aspects such as seasonality. Rovaniemi Airport in Finland was branded as Santa Claus Airport in 1984 in order to contribute to the development of 'Santa-based' tourism in Finnish Lapland. The airport has become a major tourism gateway to the region and during Christmas 2003, the airport attracted over 200 foreign charter flights and nearly 80,000 international tourists (Rovaniemi Tourist Board, 2004). The problem is that traffic at the airport is concentrated in the winter months and at certain times of the day and week, leading to seasonal and inefficient airport operations. In addition, the dominance of charter traffic, which provided 92% of the airports international passengers in 2003 (Finnish Civil Aviation Authority, 2004) may be a deterrent to the attraction of scheduled low-cost carriers that offer higher frequencies and a year-round service.

Promoting the airport

Advertising is a basic form of marketing that airports do to create awareness and communicate certain messages to target markets. However, advertising tends to communicate general messages to a general audience and can be very costly. For example, it costs an airport ?10,000 to place a one page colour advertisement in the publication Airline Business.

Attending exhibitions is another basic form of marketing that airports do to create awareness amongst target groups. For example, Highlands and Islands Airports Limited (HIAL), operators of the 10 airports in the Scottish Highlands and Islands targeted tour operators at VisitScotland Expo 2004 to promote its airports to around 1,000 buyers from the international travel trade (HIAL, 2005). However, it should be noted that scheduled carriers, especially low-cost carriers increasingly reduce links with the travel trade in order to reduce costs so the effectiveness of attending exhibitions may only be restricted to airports competing in charter markets.

Increasingly, airports adopt a more direct and aggressive means of communicating with target markets. One recent development that has supported this type of direct selling is the World Route Development Forum called « Routes ». Routes is a type of speed dating for airports and airlines as it provides networking opportunities through one-to-one meetings (e.g. see www.routesonline.com). However, airlines increasingly expect to be presented with market research on new route potential and will be particularly interested to know about the tourist appeal of the catchment area for inbound passengers and the purchasing power of residents in the outbound market(s) (Favotto, 1998).

Many smaller airports may not have the financial or human resources to carry out detailed market research and therefore, may find it difficult to target carriers in this way. One way of overcoming this constraint is to develop strategic partnerships with local stakeholders such as tourism and regional development agencies. This enables airports and local stakeholders to pool resources, develop an integrated approach to regional tourism development, and provide airlines or tour operators with a wider overview of the area and its potential. Aberdeen Airport in Scotland has tried to achieve this through the creation of an Airport Business Development Forum; a group of airport stakeholders that meets every two months to discuss route development opportunities and provides potential airlines or tour operators with a one-stop shop for data on the airport, the local catchment area and on potential demand.

Pricing the airport product

Offering price incentives has become particularly important at airports wanting to attract scheduled low-cost carriers (Francis et al., 2004). Such incentives vary greatly between airports but have traditionally included the offer of reduced or discounted airport user charges and/or the provision of marketing support.

One of the constraints faced by airports that belong to national or regional airport systems is the inability to offer flexibility in airport user charges. Quite often at these airports, charges are levied in the same way throughout the entire airport system and may be set and controlled by the State. This relinquishes the opportunity for airports to compete on pricing and is one of the reasons why low-cost carrier concentration is higher at privately or locally owned airports where there is more opportunity for them to offer flexible and discounted airport user charges.

Another way in which airports are known to offer price incentives is through the provision of marketing support. This is in recognition of the fact that airports are a derived demand and that instead of conducting their own advertising and promotional campaigns, it may be more effective for them to support campaigns via intermediaries such as airlines or tour operators. These intermediaries have a much greater level of brand recognition amongst end users (i.e. passengers) and are able to penetrate markets more effectively than airports, through aggressive marketing campaigns.

Price incentives such as reduced or discounted airport user charges and/or marketing support have traditionally been offered by airports as one off payments or discounts, or on a scale that diminishes over time. The assumption here is that the start up risk is shared until the route becomes more established and commercially viable however, airlines have often argued that such discounts should always be available and this has been a source of friction between airports and their airlines in the past (Graham, 2003).

On 3rd February 2004, the European Commission ruled that the incentives granted to Ryanair by the Walloon government for the use of Brussels South Charleroi Airport (BSCA) breached EC State aid rules. The ruling means that state-owned airports in Europe can only offer incentives that meet strict criteria. For instance, they will only be accepted by the Commission if: they are necessary to the opening of new routes and granted in a transparent and non-discriminatory manner; their duration is limited (5 years for direct flights); they do not represent more than 50% of the costs incurred to start the new route; and, they are available to any airline established at the airport. he ruling will have profound implications on the ability for airports to offer incentives and the arrangements at a number of airports, especially those that are locally owned, will have to be reassessed.

The Commission ruling does not apply to privately owned airports and because of this; we may see an increasing level of private investment at state-owned airports, especially those seeking to attract low-cost carriers through incentives.

Placing the airport product

Airports sell direct to airlines or tour operators for rights to use the airport. They then rely on intermediaries such as airlines, tour operators, travel agents or travel planning portals to reach end-users. Despite this, airports are increasingly involved in providing online travel planning support to passengers and also to their airlines or tour operators. This is particularly important considering that online travel sales in Europe increased by as much as 41% between 2003 and 2004 (Marcussen, 2005).

The provision of online timetable services (as provided by companies such as OAG and Innovata) is a basic level of online support but surprisingly, less than 10% of world airports currently buy into online timetable services (Compton, 2005). In addition, whilst most airports have an online presence, their support for airlines or tour operators is fairly limited and especially at airports that belong to large national airport systems where websites tend to be fairly plain and simple. HIAL maintains a fairly good level of online presence and support. The company provides online timetable services and links to the tourism industry, airline websites, and Expedia (a travel planning portal) (e.g. see www.hial.co.uk).

Concluding remarks

This article has provided a preliminary discussion on the challenges and opportunities for airports in Europe's northern periphery that aim to adopt a leisure-orientated marketing mix in order to facilitate the development of tourism. Greater debate on this subject is required before a more balanced and informative analysis can be conducted however, initial discussions have identified the following issues and considerations.

Firstly, airports need to understand the facilitation requirements of target markets and the ability for airports to compete at the augmented level is especially strong. Branding can also be used to gain a competitive advantage. The challenge is in deciding whether or not to specialise or to develop multiple product offerings that offer a range of service levels. This does not only apply to the infrastructure and services available but also to the airport brand.

Secondly, airports should adopt more direct and aggressive means of communication and events such as « Routes » offer tremendous opportunities however, this means of communication needs to be supported with detailed market research. For those airports that do not have the resources to conduct such research, strategic partnerships with local stakeholders are vital and enable the pooling of resources. Strategic partnerships also facilitate a more integrated approach to the development of tourism and are therefore of importance to all airports, not just those with resource constraints.

Thirdly, airports can offer incentives to encourage routes that may otherwise not have been considered however, the European Commission ruling has affected the way in which these may be applied. Airports may subsequently seek private investment in order to overcome the effects of the ruling.

Finally, airports should do more to support the distribution channels of their airlines or tour operators and the travel planning needs of end users. Airports that belong to large national airport systems tend to offer plain and simple support in this area and should consider developing a more advanced and personal approach.

Perhaps it is the nature of airport ownership or the style of airport management that facilitates the ability of airports to adopt such marketing principles. In addition, it is unclear as to whether or not such marketing principles affect the performance of airports. These are some of the issues that I hope to address in future studies?..

References:
-Compton, P. (2005). « Timetable for success, » Airport World, 10(2), April-May, 56-57.
– Favotto, I. (1998). « Not all airports are equal, » Airport World, December, 17-18.
– Finnish Civil Aviation Authority. (2004). « CAA's Air Traffic Statistics, Ilmailulaitos A 5/03, » Vantaa.
-Francis, G., Humphreys, I. and Ison, S. (2004). « Airports' perspectives on the growth of low-cost airlines and the remodelling of the airport – airline relationship, » Tourism Management, 25, 507-514.
-Graham, A. (2003). « Managing airports: an international perspective, » 2nd ed. Butterworth-Heinemann, Oxford.
– HIAL (Highland and Islands Airports Limited). (2005). « HIAL targets tour operators at VisitScotland Expo 2004, » HIAL Press, Inverness.
– Lang, H. (1999). « Attracting business to Prestwick airport. In: 1st Forum on Air Transport in Remoter Regions, » 2-4 April, Nairn.
– Marcussen, C.H. (2005). « Trends in European Internet distribution – of travel and tourism services. » [http://www.crt.dk/uk/staff/chm/trends.htm] (accessed 26th October 2005).
– Rovaniemi Tourist Board. (2004). « Rovaniemi Region Marketing Strategy 2005, » Rovaniemi Tourist Board, Rovaniemi.

Catégories
Around the world Transportation

Airports in the marketing era (Conference summary)

Northern Europe has a large number of secondary airports, many of which were built for military or regional development purposes. Until recently, the primary role of these airports was to provide a public service to small communities located far from big centres, by linking them to the main transportation networks. In a more open, less regulated environment that is increasingly influenced by new economic realities, airport management approaches must change. Nigel Halpern, a researcher at the Centre for Civil Aviation, London Metropolitan University, is interested in these changes and calls into question the traditional marketing practices of airports. He presented his thoughts at the 14th Nordic Symposium in Tourism and Hospitality Research, held in Iceland. Several interesting parallels can be drawn between the situation he describes and Québec's network of airports.

A limited, regional role

As a general rule, smaller airports are confined to playing a limited role, overshadowed by the hub used by major carriers. The connections offered are often provided by small aircraft and quasi-monopolistic situations lead to particularly high prices. This type of situation is certainly not unique to Québec.

Secondary airports are usually public entities owned by municipal or governmental authorities. Under-utilized, most of them operate at a loss and require subsidies to keep afloat. A monopolistic environment, as we experienced here with Air Canada, can create an unusual situation of minimal competition between airports and a lack of incentive for airports to reduce costs and improve efficiency. The result is that these airports have virtually nonexistent marketing practices, limited primarily to passive approaches such as publishing an airline timetable.

A changing environment

According to Nigel Halpern, airport marketing is evolving rapidly to adapt to a new business environment characterized by changes in travel behaviour and structural changes in the airline industry. In Northern Europe, several airports have embraced these new business realities and adopted more market-driven management practices. Competition is now global, both for all-inclusive packages and independent travellers. Furthermore, in several regions, the presence of low-cost or discount carriers is making the market extremely dynamic.

In an increasingly open business environment, airport managers have to deal with often unpredictable airline decisions that are increasingly based upon market forces. Airports wishing to strengthen their position as a tourist destination must adapt their management practices accordingly and become much more pro-active in their approach to marketing.

More and more airports, like Oslo's Gardermoen Airport, for example, are using advertising campaigns to target specific markets (see photo). However, due to the high cost, such initiatives are usually available only to larger airports or, at the very least, to airports that have developed joint campaigns with other partners. Some groups also make a point of attending tourism trade shows to stimulate the development of new markets.

A clientele that now includes more than just airlines

Airports are increasingly called upon to offer services directly to tourists, notably by providing travel planning tools such as online timetables and links to online agencies. Surprisingly, only 10% of the world's airports provide timetables on their websites. The service provided by Highlands and Islands Airports Limited is an interesting example because the website offers advanced search options (see photo. In comparison, the Aéroports de Montréal website only posts information on the day's flights.

Working to develop business

Airports can use a number of practices to take advantage of market trends and meet the needs of their clientele, the airlines. To successfully compete and attract new destinations, airports must become aware of the incentives that can enhance their market position.

If an airport wants to attract new business, key factors are the rates charged and the existence of promotional campaigns developed with strategic partners. For example, carriers who select Cork Airport in Ireland for a new scheduled route benefit from substantial savings on airport charges. The five-year business model offers the following incentives:

  • 100% discount for the first year
  • 80% for the second year
  • 60% for the third year
  • 40% for the fourth
  • 20% for the fifth

The strategy appears to have worked because traffic at the Cork Airport nearly tripled in the 10 years from 1994 and 2003. This is all the more impressive considering Cork essentially shares its market with Shannon Airport, the Irish hub of low-cost carrier Ryanair. Competition between the two airports is limited, however, by the fact that both are owned by Aer Rianta. In fact, since 2005, Cork Airport has employed a different incentive program, based instead on fare reductions per passenger.

Obviously, a carrier could terminate a new route once the lease has expired. But with financial incentives, airlines can take a risk on a connection that is more of a gamble. And a five-year time frame is usually long enough to generate a sufficient client pool to ensure profitability. The first few years following the introduction of a new route is when a carrier truly needs support from the airport.

Another interesting development is the World Route Development Forum called « Routes ». This annual event facilitates meetings between airports and air service providers and encourages airports to pursue new options. A type of « speed dating », Routes provides airports with multiple opportunities to forge new business relations with various tourism industry stakeholders.

Avenues for specialization

Airports wishing to target the tourist market can choose to specialize and focus primarily on the following areas:

  • Costs (e.g. by operating a very simple terminal and offering a minimum of services)
  • Flexibility (e.g. by employing a multi-skilled workforce and outsourcing handling)
  • Speed (e.g. by offering fast turnarounds and advantageous positioning for aircraft)
  • Access (e.g. by offering longer opening hours and emphasizing its proximity to the destination)
  • Infrastructure (e.g. by having a longer runway and enhanced terminal capacity)

Airports wishing to grow their market are, nevertheless, dependent upon demand. Marketing efforts cannot, in themselves, guarantee success. However, airports can certainly benefit from gathering market intelligence and collaborating closely with local tourism stakeholders and regional development agencies.

See also

Highlands and Islands Airports Limited 
World Route Development Forum

Catégories
Accommodation Around the world

Commentary from Michael Nowlis on the hotel classification

Michael Nowlis is Managing Director of Tourism Control Intelligence. He has rated hospitality establishments for various guides and trained AAA inspectors.

Why make things simple when you can make them complicated?  Such a rhetorical question summarizes the obfuscation created by tourism authorities, intergovernmental organizations, travel companies and trade associations in their discombobulated initiatives to classify hotels. Many European countries categorize hotels using a system of one to five stars. However, that's just the beginning.  The French government awards a maximum of four stars but has an alternative category called « four-star luxe » and another, termed « HT ». In Dubai, a major destination for European vacationers, there is a seven-star hotel. Spanish lodging establishments are graded using a star scale with additional qualifiers such as « R », « H » and « Hs ». A modest Madrid hostel, for example, could have a rating of « ** R Hs ». European hotel classification is a jumbled litter of incomprehensible stars, diamonds, letters and numbers.

While hospitality industry has long resisted Brussels' initiatives to harmonize hotel categorization in the name of consumer protection, national tourism authorities are also losing the battle to standardize hotel ratings. Devolution and decentralization have resulted in classification standards becoming increasingly diverse rather than more uniform. In Spain, each of the seventeen regional authorities has its own approach to grading lodging facilities.