The Visit USA Market with a President Trump? Don’t Think Twice, It’s All Right
Key Receptive Tour Operators Foresee a Healthy 2017: It may be that, when it became clear in the early morning hours of Nov. 9 that Donald J. Trump was President-elect of the U.S., there was some weeping and gnashing of the teeth among the thousands of delegates at the last day of the World Travel Market in London where the news seemed dire. But, as a London cabbie told one U.S. supplier passenger when asked what he thought about the matter, the driver replied: “Why would anybody stay away from a holiday in the U.S. simply because there’s a whacko in the White House?”
And that, but for the brevity and bluntness of the London cabbie, is the essence of what most on a panel of receptive tour operators at the first day of the NAJ Group’s RTO Summit in Orlando seemed to believe. Expatriates all, the panel was comprised Uri Argov, CEO, Tourico Holidays, a company with global reach; Jay Santos, managing director USA for, Trend Travel USA, which focuses primarily on Brazil; Pabs Raghava, CEO, Tours Limited, which serves the Indian market; and Gisa Kusserow-Hanson, general manager, Florida, AlliedTPro.
The moderator for the session—the NAJ Group’s Florian Hermann, himself an expatriate from Germany—got the panel right to the point in a program segment titled, “How Will a Donald Trump Presidency Affect International Tourism Arrivals?” by asking each operator to rank, from zero to 10, with zero being a worst case scenario and 10 being the best possible situation, their outlook for the future of inbound tourism to the USA under a President Trump. Graphically, here is what the responses looked like.
Here are some of their comments:
—“I don’t think there will be any effect on business,” Argov declared. “The USA is the place to travel in terms of service and experiences.” Politics, he added, “is at the end of the day” in business considerations. Much of apprehension over a Trump presidency, he observed, came with the way the news was reported in the first two or three hours that the result of the election became apparent. “The media can be so one-sided,” he said, asserting that his company “will see an increase in traffic … we cannot let out political feelings into our business. It’s not about us. It’s about our client.”
—“I agree with Uri,” said Raghava. With her company in the midst of contracting for 2017, she indicated that “we do not see any impact” on business because of a prospective Trump presidency, adding, “It’s not going to be a negative or a difficulty … things look pretty good for us.”
—After acknowledging that the news of Trump’s election caused a number of WTM delegates to worry, Santos addressed the situation in quantitative terms, pointing out that the long-haul market to the U.S. is about one percent of the Brazilian population, emphasizing that “That one percent loves the U.S.” Santos suggested that talk of more restrictive U.S. visa policies could be a challenge and he expressed the hope that Trump, himself the owner of a number of hotels, would be sensitive to industry needs, closing with “I don’t see any problems.”
—“Guess I’m the party pooper here,” said Kusserow-Hanson with a trace of a smile. She suggested that for some markets (see next article on German trade reaction) a President Trump “will be a reason that some people will want to go to another place for a year or two … we’ll see a smaller volume from some markets (but) we’re not going to see a boycott or something like that.” She noted, however, “I do see an increase in business as well—not because of Trump—but because some markets are ready.”
NAJ’s RTO Summit in Orlando, Day One—International Digital Day: A Photo Log
Watch for more photos from the RTO Summit in the next issue of the Inbound Report.
Because of Trump, Will German Arrivals to USA Shrink?
It is now more than three weeks since America and the rest of the world woke up to the news that U.S. Electoral College math had made him the next president of the United States. Since then, the many tour and travel industry professionals who slipped into a Stage I condition of shock (no one, as far as we can tell, reached Stage II or the end point of Stage III—death) upon hearing of “President-elect” Trump seemed to have recouped and are back to focusing their energies on selling and marketing their product.
With few exceptions, overseas source markets seem to be moving along on a path toward sending increased numbers of visitors to the USA—except for one: Germany. There, particularly in its tour and travel industry sector, Trump’s rhetoric and public persona created such a turnoff that it could very well result in a downturn in German arrivals for the next year or so.
At the Inbound Report, we have noticed: the German travel trade news media has had published several articles to this effect; U.S. suppliers selling to Germany have told us that a fair number of buyers expect a fall-off in traffic to the U.S. next year; and, publicly, some industry insiders have said the same.
For instance, during a session at the International Digital Day session during NAJ’s recent RTO Summit in Orlando, while other panelists expected little to no impact on traffic to the USA from their key markets in Europe, Asia and South America, German expatriate Gisa Kusserow-Hansen, general manager, Florida, for AlliedTPro, told delegates, “tourism will be affected … and Donald Trump will be a reason that some people will go to another place for a year or two.”
It may be difficult to quantify such a Trump factor, as German arrivals to the U.S. were already off to a bad start for this year. Through April 2016—this is the last month for which office numbers are available from the U.S. National Travel and Tourism Office—German arrivals to the USA were down 7 percent for the year vs. the same period in 2015. We prepared the following table to put the arrivals picture into a larger context.
So, how would one measure a Trump impact? The answer lies, perhaps, in what one U.S. supplier, fluent in German and with a long history of working the market, suggested to us. Just as the people in the industry who supported Trump were quiet up to, and after, election day, there are many people who still oppose him, but are remaining quiet.
Our source, who asked to remain anonymous, suggested that German operators will simply stop buying Visit USA product and start selling other destinations. Travel agents will do the same, he explained, and consumers will buy elsewhere. And some will cancel existing reservations and shift their resources to purchasing a holiday package at another destination.
This is what happened, he told us, upon the election of George W. Bush as U.S. President in 2000. With Bush extremely unpopular in Germany, many people simply cancelled travel plans and changed them. Or those who were thinking of coming to the USA booked their vacation elsewhere. While it is difficult to gauge causality, we took at closer look at German arrivals to the U.S. from the time Bush claimed victory (the election was on Nov. 7 in 2000) for the next 10 months—into the month of September, which gave us the Sept. 11 terrorist attacks on the U.S. Keep in mind that 2000 was already a bad year. The first 10 months of the Bush Administration coincided with (or caused, our source suggested) an even worse drop-off in U.S. arrivals.
Tui Might Tell Us: While hard numbers on this subject will be hard to come by, it just might be that Tui, the largest tour operator in Europe, will be in a position to tell us when it stages its May 2017 half-year financial advisory. Tui is now, it has proclaimed, the largest provider of U.S. product to German travelers. The operator recently announced its summer 2017 program, which includes around 200 new hotels and 30 new round trips itineraries. And in New York City, there is now a dedicated Tui service center right on Times Square, where guests are cared for two days a week.
What has been the Impact of Brexit on UK Outbound Travel to North America?
Looks like Nothing: The latest data released by the UK’s Office for National Statistics (ONS) show that there was little change in the steady upward increase in the number of visitors to the USA by residents of the UK since the June 23rd vote by UK citizens to leave the European Union (EU). In fact, the just-released numbers show that, in the peak travel months of July, August and September, UK departures for the quarter increased by 8 percent over the same period in 2015. And, year-to-date, departures for North America increased by 4 percent vs. 2015.
For the German Travel Trade, It’s been a “Lost Year”
“The travel agency sector has effectively lost a year of growth,” said the Nuremberg-based marketing research firm GfK as it released the latest monthly data on travel agency sales for the year ending Oct. 31st. The report is based on an analysis of bookings by 1,500 travel agencies.
The Bad News:
—According to GfK’s latest market survey, German travel agency vacation sales have declined by 5 percent this year; the worse news is that winter bookings are still weak so far. Other sobering points noted in the GfK report including the following:
—The numbers mean that the German organized travel market has recorded its first revenue in years.
—Summer revenues dropped by 7 percent.
—The main reason for the drop-off was an overall 29 percent decline in sales of holidays in the Eastern Mediterranean, which outweighed growth in Western European and other destinations.
—Demand for winter holidays is also weak at present, with an 11 percent drop in bookings compared to October 2015, leaving accumulated bookings so far for winter 2016/17 down by 8 percent.
The Good News on the Horizon:
—Early bookings for summer 2017 are 1 percent ahead of the same period last year, and they accounted for nearly 47 percent of total revenues last month, 10 percentage points higher than in October 2015.
—Meanwhile, Germans are continuing to book more cruise holidays than ever before; there was a 43 percent rise in bookings last month compared to October 2015, according to the monthly sales survey of some 2,500 travel agencies by IT services company TATS. They are now running at an overall 12% increase.
—Travel agents are currently more optimistic than in recent months after writing off this year and looking ahead to 2017. The latest FVW “sales climate index” conducted in early November showed.
—About one quarter of German travel agents now expect rising sales in the coming months and about half expect stable revenues, which is higher than the comparable figures one month earlier.
eTourism International to Launch at RTO Summit in February
The two-day RTO Summit West will launch on February 8-9, 2017 with a day-long program on Feb. 8th in Los Angeles designed to provide international sales professionals with digital skills to complement their relationship marketing activity. The objectives are:
—Explaining digital tactics for the tour and travel industry’s international sales professionals; and
—Providing one-on-one executive coaching from experts who will help them to better understand international strategy, WeChat and other platforms effectively.
“The re-branding of the first day of the RTO Summits as eTourism International is designed to level up the value of the event by equipping travel industry sales people with digital tactics that can help advance their careers.” explained Jake Steinman, CEO of the NAJ Group, which stages the RTO Summits. “Of course, day two will feature business appointments that bring together travel suppliers in face-to-face meetings with receptive operators.”
The program will include presentations that cover a range of subjects, including the following:
—The Best Performing Digital Channels that drive International Sales in the leading source markets of UK, Mexico, Brazil, Japan, Germany, China and India.
—Five Key Things You Need to Know about Google.
—Five Things You Need to Know about International Facebook Marketing.
SMARKETING: How SMARKETING (Sales & Marketing) can support one another in developing a cohesive international sales strategy.
—How to evaluate digital marketing campaigns proposed by in-country reps
—“Yes, Even You Can Afford it!” Examples of low cost Digital Marketing Campaigns that have proven successful.
—Utah’s Cafeteria Coop program … How the state of Utah created an international off season coop program that worked for suppliers at different budget levels
—Visit Houston’s Influencer campaign in Mexico … How Houston built a content marketing program around two influencers in Mexico that yielded over 1.5 views and impressions.
—National Park DMO’s influencer campaigns in Germany … Posts, Translations, Videos.
—Examples of International Digital marketing Campaigns at different budget levels:
—Key Travel Trends from UK, Germany and France … TripAdvisor will be releasing the most recent version of its European Travel Monitor research including how inbound hotel bookings have been affected by Brexit and decline in the Euro, and Donald Trump’s presidency
—Five Things You Need to Know about Digital Marketing to reach Chinese FITs:
—Power Panel No.1: Find the Best Online Media Channel that will Boost Activity in Low Season. Learn from key company officials how Expedia Media, Travelzoo, and TripAdvisor can be used for coop programs to that target international visitors before they arrive.
—Power Panel No. 2: A prestigious panel of leading receptive tour operators discuss their outlook on 2017 bookings, where they see opportunities and challenges. Companies participating are: AlliedTPro; New World Travel; American Tours International; DTE; and the Japanese Tour Operator Association.
To register for the RTO Summit, and for other information, visit:
For the 6th Consecutive year, NAJ will host the Japanese Tour Operator Association luncheon during the RTO Summit.
And the Worst Airport in the USA is …
Released just in time for the holiday season in the U.S. is the list of the Top 100 Airports in the country. According to the report’s creator, TravelPulse, its editors spend a good part of the year traveling the globe and have experienced the glaring disparities between international and domestic airports.
More than 300 respondents, both consumers and aviation experts, were asked via Google Survey to rank airports in seven categories – ease of access, amenities, airline volume, terminal modernity, terminal comfort, family friendly and business friendly.
Attention to detail is largely missing in U.S. airports, as countries around the world have trumped statewide airports on the innovation and design creativity fronts.
Highlights from the survey results:
—Atlanta Hartsfield-Jackson was voted best airport in the country for its ability to handle high volume of airlines, passengers, and get them in and out. But in large part, Atlanta finished so high because it also finished first for the number of amenities it offered and for being business friendly.
—Size matters! Many respondents said the ability to choose from among numerous airlines, at differing times, offering better fares, was important to them and that can only be found at big airlines. The top six in airlines volume satisfaction among those surveyed were LAX, JFK, O’Hare, SFO, Orlando and Vegas. In the business friendly category, all of the top five were also the biggest airports in the country.
—Small airports did very well – Fort Myers, Manchester, Columbus, Savannah, and Greenville were all in the top 50.
—For such a big airport (14th in the nation in passenger volume) respondents found Orlando the easiest to access both getting to (and with parking being $17/day to self-park compared to $33 at JFK) and once inside (its famous tram system).
—Honorable Up-and-Comers: A lot of earned kudos from readers were for newer airports; Phoenix, Portland, Ore., and Nashville.
—Two airports that had undergone massive renovations and makeovers in the last 20 years, Detroit and Denver, also came out on top.
—Of all the categories, readers were most passionate about terminal comfort. Detroit “won,” but most said it’s almost impossible to be comfortable in an airport terminal.
Top 10 Best Airports
- San Franciso
Oh … last on the list in New York City’s La Guardia Airport. Here is the complete list.
A Note on Methodology: TravelPulse asked respondents to rank as many airports as they could among 115 that qualified under its criteria – the facility either processed 700,000 or more passengers in 2015 per Federal Aviation Administration rankings, or are the top-ranking representative of their state.
The methodology including asking respondents to rate airports based on these seven categories:
* Ease Of Access. How is getting to the airport via car or public transportation? Is there sufficient parking, moving walkways, trams and other amenities that makes access easy?
* Terminal Modernity. Is it older or newer? Has the airport embraced newer technologies with Wi-Fi, modern signage and device chargers?
* Terminal Comfort. Is it clean? Easy to navigate? Plenty of seating?
* Amenities. Are there numerous food options, including healthy choices? What about shopping and entertainment options, massages and sleep lounges?
* Business Friendly. Does the airport offer good commuter flights and nonstop? What is its proximity to the nearest city? What about airport lounges and business centers?
* Family Friendly. Are there ample changing stations, kid-friendly food options and clean play areas?
* Airline Volume. Does the airport serve a high number of airlines? If it is dominated by one carrier and being used as a hub, are there enough strong destinations and nonstop flights?
A Quick Dissection – – the Brazilian Slump Points to Recovery:
Tour and travel industry professionals have been nearly unanimous in their belief that the Brazilian market is ready for a rebound—for instance, Orlando-based Jay Santos, managing director USA for the Brazilian operator Grupo Trend, told an industry conference two weeks ago that he was “bullish” on Brazil for 2017—for several reasons:
First, while arrivals to the USA from Brazil are expected to decline significantly this year, many observers point to the decline as a result of the political trauma the nation has experienced this year—due to the impeachment and removal of a president and scandals involving Petrobras, the nation’s semi-public, multination energy corporation.
Second, a downward spiral in the currency exchange rate, which hit a low point last February when the Brazilian real sunk to $0.25 against the dollar, seems to have been checked, and the real is back at about $0.30—a 16 percent recovery from its low point. (See chart below)
Third, a major challenge to travel abroad has disappeared. Part of the problem for Brazilian operators in the first quarter of the year was an increase, at the beginning of 2016, in the tax on remittances abroad from 6 percent (an effective 6.38 percent by the time other charges are incorporated) to 25 percent (a de facto 33 percent). By March, the Brazilian Congress and then-President
Fourth, Brazilians have kept traveling and kept spending when they have traveled, but they have spent less. Confirmation of this came with the recent release from Visa Performance Solutions, a consulting firm of the global financial institution, which conducted a study on the consumption profile of Brazilians in their international purchases.
In the survey, which collected transactional data from the company’s payment network between 2013 and 2015, Visa noted that, despite continuing to consume, travelers have changed their purchasing priorities. “Consumer behavior has changed. He/she did not stop spending, what changed was his/her profile of purchase.” Said Rodrigo Santoro, director of Visa Performance Solutions in Brazil. The study also revealed that, in addition to changing their priorities in spending, they’ve also changed their destination priorities.
Most significant is the change in spending on clothing by Brazilians. When the Inbound Report interviewed shopping center executives in the Orlando area in the summer of 2015, we learned that Brazilians were shopping less for clothing—which used to be their number one purchase while on vacation. No more. The new top five categories of spending are in the following table.
Other points of interest from the Visa survey include the following:
—Brazilian spending abroad is concentrated in the United States and Canada (46 percent), despite a high drop in transaction volume.
—The top four destinations, all in the United States—Orlando, Miami, New York and Las Vegas—alone accumulate an incredible 20 percent of total spending.
—Orlando, Miami, New York and Las Vegas are the leading cities which, Santoro says, are “very stable” and that changes in ranking are not expected in future surveys.
—Santiago, the capital of Chile, emerges as the fifth city with the largest flow of expenses of Brazilians around the world, surpassing Fort Lauderdale, Florida.
HODGE PODGE: Shifts, Shakeups and Occasional Shaftings in the Tour and Travel Industry
Carolann Ouellette is leaving her post as head of the Maine Office of Tourism to become executive director of Maine Huts & Trails, a nonprofit that operates a system of backcountry trails and lodges in Maine’s western mountains. Ouellette joined the state tourism office in 2011. Previously, in her career, Ouellette was chef/owner of an award-winning Maine restaurant in Jackman and, for a period, managed the Sugarloaf Inn. In 2015, she was named by Maine Magazine as one of “50 Mainers Boldly Leading Our State.” She will start her new job on Jan. 1, 2017.
Gregg Gant has returned to his old post as business development manager for Travelzoo following an interregnum of nearly a year-and-a-half as senior trade manager, North America, for Tourism New Zealand. Gant first joined Travelzoo in 2012. Previously, he had served as a sales rep and account executive with Miles.
Holger Taubmann (left) is stepping down from as senior vice president of distribution for the Amadeus IT Group after a little more than five years in the position and nearly 20 years with Amadeus. His retirement is for personal reasons, but he remains in the company and is to assume a new position in the foreseeable future. As of Jan. 1, 2017, Laurens Leurink (right) becomes vice president of distribution and a member of the executive committee of Amadeus IT Group. Leurink is currently president, lodging partner services, for Expedia, Inc.
The latest word from Omaha is that John Ricks, a former state tourism director in Colorado, has been offered the same post in Nebraska by the state’s Tourism Commission. Ricks, a long-time veteran of the tour and travel industry, would replace previous director Kathy McKillip, who was fired last May after an audit revealed that the agency had overspent its contract with ad agency Bailey Lauerman by $4.4 million over three years.
Bruce McNamara has been named production manager for Beachcomber Tours. He comes to the company from Austral Lagon. McNamara, who takes over from Françoise Maymou, has served in senior positions at Jet Tours, Transat, Look Voyages and Thomas Cook.
John de Denghy has joined Gentravel Solutions as a new partner/managing partner. He joins the company from Hotel Connections, where he was international vice president of business development and hotel relations. De Denghy also served for 20 years with the InterContinental Hotels Group, lastly as director, leisure & transportation global sales.
In Brazil, TBO Holidays has announced the appointment of Ana Vainstein as its new commercial director for the Americas, a new position created by the company in order to expand its operations in the region. A veteran of more than 20 years in the tour and travel industry, Vainstein will use Brazil as the base for operations in the rest of the Americas as well.
Jürgen Witte (left) has given up the management of operations for the GDS Group Travelport in Germany and Switzerland after almost seven years. He wants to assume a new task at the beginning of 2017 in another company. Witte has been with Travelport since the beginning of 2010 and joined Travel-IT’s management in 2015, after Travelport took over the majority of shares there. Dieter Rumpel (right) is leaving his job as country manager of Travelport in Switzerland to take over the post vacated by Witte.
Guy Young, the new chief engagement officer and president, CostSaver for The Travel Corporation (TTC), is moving from Los Angeles to New York as the company is establishing a larger office—it has a small office in Rye, N.Y.—to increase the company’s presence on the U.S. East Coast. TTC’s brands include Trafalgar, Insight Vacations and Contiki. A long-time veteran with the company, Young had previously served as president of TTG’s Uniworld brand.
Gary Orfield has been promoted to Director of Travel Industry sales at the Greater Palm Springs CVB. He replaces Ashlee Ciora, who accepted a position as Senior Director, Los Angeles Tourism and Convention Board. Orfield joined the Palm Springs bureau two years ago after serving for more than a decade at several Westin hotel properties.