Supplier and DMO Reveal Tips and Tricks for Working with RTOs
New York RTO Summit Panel Talks Business: If the consensus of a panel of long-time tour and travel industry veterans is any sign, 2018 should treat well both U.S. travel suppliers and the U.S.-based receptive tour operators they work with.
“We’ve had the best first quarter in five years,” Juan Sepulveda, director of international sales for The Roosevelt Hotel in New York City, told delegates at NAJ’s recently convened, day-long symposium that took place at the RTO Summit East in New York. “The airline business is coming back into cities because of the amount of new inventory,” added Sepulveda, who has been part of the hotel sales segment of the industry in New York for decades. “They want to be here.”
Sepulveda was part of a three-person panel of suppliers which also included Sheelagh Wylie, vice president, business development and head of sales, Midways Attractions, Merlin Entertainments; and Stefan Merkl, president of Explore Marketing, which represents a number of suppliers in international source markets. They discussed the state of the marketplace and other points of interest. Following is a synopsis of some of the points made by the three panelists.
—On working effectively through the receptive tour operator (RTO) channel: On the U.S. East Coast, she told an audience comprised heavily of supplier professionals from the U.S. Northeast, one will find their strength in two areas. RTOs in the Orlando are strong in Latin American markets, especially Brazil. RTOs based in the New York area are strong with European markets.
—In the past, “it used to be all about the airlines and all about hotels … now that the focus is more on the travel experience, and RTOs are selling more attractions.”
—Attractions have become anchors in regional promotions. A case in point: Travel South USA has a promotion that features the Merlin’s Madame Tussauds attraction in Nashville.
—The UK and China are Merlin USA’s top two overseas markets now. Increased non-stop lift capacity, including a new Delta Air Lines flight from China to Atlanta, is helping, as Merlin attractions are being included in itineraries that feature the South.
—San Francisco “has had a huge uptick in business which is due to increased traffic from China.”
—More than any other factor, the U.S. dollar and its strength vs. other currencies affects business. And the talk of a “trade war” with China might affect the New York and Los Angeles markets.
—Key country markets for his business are: Europe, with traffic from Spain, Portugal and France increasing; the UK, Germany and Brazil, with these markets generating more FIT traffic; and Mexico, which is “really starting” to increase.
—A problem of late, on that causes some friction with RTOs and their customers, are the additional fees now being tacked onto the cost of a hotel room. Taking a cue from Las Vegas and resort destinations, hotels are now beginning to charge a deposit or a facility fee. Others call it an “urban destination fee.”
—For his clientele, which are located in different parts of the country, the top markets are: Canada, Mexico, the UK, France, Germany, the Benelux countries, and Scandinavia. And, currently, “China is hot,” while India and South Korea, which is moving to FIT travel, are strong. Brazil and Japan are also performing well.
— While trade shows are a necessity, it is important to boutique operators to see them in their offices. “Ours is a relationship business … The tour operator gets to know you and you become the go-to person. It’s about maintaining the contact; it’s not good enough to go to a trade show once a year.”
Celebrating IPW at 50 Years: What Was Your Most Memorable Moment, Tilo Krause-Dünow and Sheelagh Wylie?
As we prepare to gather in Denver later this month (May 19-23) for the 50th edition of IPW—the most important event on the inbound tour and travel industry’s calendar—the INBOUND Report shares recollections of and about the event from those who have been a part of IPW (formerly Pow Wow) over the years. This week, we feature the recollections of two well known tour and travel industry leaders: tour operator Tilo Krause-Dünow, owner, Canusa Touristik; and Sheelagh Wylie, vice president, business development and head of sales, Midways Attractions, Merlin Entertainments.
Tilo Krause-Dünow: “It was in New Orleans when IPW was in September and all the participants started leaving Tuesday. I inquired as to what was happening and was told a hurricane was expected. I said why are they leaving, that’s an attraction … it’s incredible … why are people leaving. The next day I knew why. Wind whipped trees sideways and I was scared to death. I’ll never get near another hurricane again.”
Sheelagh Wylie: “One of my favorite memories of IPW was taking the last ferry over to Ellis Island with two of my favorite colleagues for the final night of Pow Wow 2005 in New York City. We were exhausted after days of meetings and networking and considered not going, but rallied at the last minute. Lady Liberty welcomed us in the harbor as we sailed to the island. The event was designed to promote New York as the world’s second home, featuring food and entertainment from around the world. The evening concluded with a spectacular fireworks display with the Statue of Liberty in the background.”
Faces from the RTO Summit East, New York City: Day Two
More than 50 tour operators met just over 100 travel suppliers and DMOs for a day of 10-minute, face-to-face appointments in an intense business appointment atmosphere, prefaced by a networking breakfast and with a luncheon at mid day. Following are some of the people who were a part of it all.
The Top Two Trends in the Chinese Inbound Market
They involve the young, rich and educated and those from second-tier cities., associate editor of Jing Travel, the travel news publication that focuses on Chinese travel trends—especially among the well-to-do or luxury travels—left little doubt when she spoke to delegates at NAJ’s RTO Summit East in New York on what she and Jing see as the top two trends for the world’s largest source country for outbound travel.
Trend Number 1—the Rise of FITs:
- A shift from group travel to independent travel is taking place/has taken place.
- There has been a shift from visiting o seeing the “most famous
sights and things to “authentic” experiences.
- There has been a shift from a reliance on travel agents and tour guides to digital tools.
- Customized itineraries are now de rigueur.¹
FIT travelers are: young (mostly millennials), well educated, affluent, have skills in languages other than Chinese, are digital and “live by WeChat.”
What kind of travel product are they looking for? Pan said that the new FITS have a growing appetite for holistic, experiential vacations. This could include:
- Experiencing local life
- Self-driving tours
- Sampling new cuisines
- Discovering cultural events like the museums, theatres and concerts
Pan pointed out that Key Opinion Leaders (KOLs) are extremely influential online, with scores of bloggers who have a million followers or more. Recently, a Chinese travel blogger with 69.3 million followers on Weibo posted a video documenting his latest safari trip to Dubai, creating a boomlet in interest in the destination.
Digitally, the behavior of the new FITs is reflected in the exponential growth of WeChat, the growth of Weibo (“China’s Facebook”) and the recent launch by Ctrip, China’s dominant online travel agency, of a “customized travel platform” and virtual tour manager.
Pan’s advice on what do in order to accommodate the rise of FITs:
—Use the right digital tools.
—Embrace the digitalization of the market and nurture new customers online.
—Understand the difference between digital platforms.
Trend Number 2—Travel from Lower-tier Cities:
“Don’t just focus on tier one cities,” Pan told delegates, predicting that China’s second- and third-tier cities will be the primary drivers of economic growth and demand for international goods and services in the future. This is due to the fact that per capita incomes are rising rapidly in many of these Chinese cities.
China has 15 cities that have metropolitan areas of more than 10 million people. The largest of these—Guangzhou, 44.3 million; Shanghai, 36 million; Chongqing 25.2 million and Beijing—have been the principal source of long-haul travel to date. But other cities, with populous metropolitan areas, further away from the country’s eastern arc, have been getting international airline service and are beginning to generate substantial numbers of outbound travelers. These include cities such as Jinan, Xi’an, Tianjin, Chengdu, Wuhan, Fuzhou, Hangzhou, Harbin, Shenyang, Qingdao and Nanjing.
Pan told her audience that those who are serious about cultivating business in tier two cities should have representation offices in those cities.
¹ At roughly the same time Pan was delivering her presentation; Ctrip Customized Travel and the China Outbound Tourism Research Institute (COTRI) issued a report, on the customized travel patterns of Chinese visitors to Europe, which showed that European travel saw a 130 percent year-on-year increase between 2016 and 2017.
Overall, the Chinese customized travel market in 2017 grew rapidly, and it already accounts for 10 percent of the whole outbound business.
Speaking at the Customized Travel Summit in Budapest, COTRI director Dr. Wolfgang Georg Arlt said: “The demand and consumption of customized travel by Chinese consumers is unique. Such travel patterns are not common in Western countries, where they are typically limited to middle-aged and older customer groups from high net worth backgrounds. Customized travel in the Chinese market, therefore, is unique in that it is characterized by its popularity, youthfulness, and high growth rates.”
Mush! Active America China Moves to Alaska in 2019
The 11th edition of NAJ’s Active America China Summit has been scheduled to take place March 24-27, 2019 at the Anchorage Hilton in Anchorage, Alaska, reports NAJ’s president, Sofia Williamsson. It will mark the first time, she added, that the event—which brings together U.S. travel suppliers and DMOs with Chinese tour operators and U.S. receptive tour operators—“will be held outside the ‘Lower 48.’”
“This boutique trade show has proved to be, arguably, the most cost-efficient marketplace for buyers and sellers of Visit USA product for international travelers from China,” Williamsson pointed out, explaining that, at the recent 10th Active America China Summit held in late March 2018 in Atlanta, there were 145 travel suppliers; 43 wholesalers and 21 U.S.-based receptive tour operators. This represents a supplier-buyer ratio of 1-to-2.1.
“Active America has sold out well in advance for four consecutive years,” she said, “and we expect that next year’s edition will do the same, especially because of the continued, growing increased interest in Anchorage and other travel experiences in Alaska on the part of Chinese tour operators, agents and travelers.
For more information, or to follow Active America China 2019, visit:
Trade Notes from the UK—New Operator Brands and Shuttered Stores
- Cosmos is going to introduce a new premium tour brand—Globus—to the UK market. It will offer four-star product, as well as a winter program. Like Cosmos, which promotes “affordable tours,” the brand is part of the Globus Travel Group. The new brand current operates in a number of markets, including the United States and Canada, but is now being introduced to the UK.
Giles Hawke, chief executive of Cosmos Tours and Cruises and Avalon Waterways UK, told the UK travel trade publication TTG that Cosmos would now only offer three-star product in hotels just outside city centers, while Globus would feature four-star properties “and a more inclusive offering” in centrally located areas. Globus will also offer winter product, entitled Escape by Globus, which will feature the same tours as in the summer, but with 30-40 percent lower prices.
- Getabed and roomsXML have launched a new brand: Stuba.com. Both existing brands will retain their identities for the foreseeable future while the Stuba brand is rolled out this year. Stuba will be headquartered in Dubai where both getabed and roomsXML are currently situated. The company will continue to have offices in the U.S., UK, India and Australia.
Said Stuba CEO Ruchir Bang, “Stuba will be significantly larger in scale to what roomsXML and getabed were individually, but we are very mindful of not losing any of the values and ethos that made both brands so popular.”
- According to research commissioned for the accounting firm PwC, There were 358 closures of high street travel agencies/stores in 2017, with just 32 new openings—for a net loss of 326 travel agents. Numbers from the survey, which was conducted by the Local Data Company (LDC) also show that the net loss of retail units was higher than banks and financial institutions, which were down 201 retail units; and estate agents, down 102 units, making travel agents the “biggest faller.”
LDC gathered data from 500 towns, which showed a total of 5,855 outlets closed on Great Britain’s high streets in 2017 at a rate of 16 a day, compared with 15 a day in 2016. The number of new openings fell from 4,534 in 2016 to 4,083 last year. The figures do not, however, estimate how many working-from-home businesses have been opened in travel or other sectors.
NYC & Company to Sell Department of Sanitation T-Shirts and other Apparel
There is no doubt that New York City is the USA’s most dominant tourism brand, and its reach is growing. Thanks to NYC & Company’s expanded international licensing program with CAA-GBG (the world’s largest brand management company and licensing agency), there are now 22 NYC licensees outside the US. Expansion within fashion includes a partnership with Heron Preston and DSNY (Department of Sanitation of New York) to release a global collection that was sold around in the world from Barneys in New York to Selfridges in London. Additionally, in partnership with Hanes, a pop-up shop was created in select Nordstroms around the country to display Parks and Recreation designs on T-shirts. NYC & Company continues to woo some of the top names within the licensing industry, recently signing domestic 11 contracts with New Era and Pintrill.
Even the city’s sanitation department has a t-shirt.
Meet Jeenie at IPW: A Live Interpreter in your phone—Part II
Last week, INBOUND introduced you to Jeenie™, the first “live interpreter in your pocket” App. Jeenie is the brainchild of Kirsten Brecht Baker, who will be sharing a booth (#343) with TourOperatorLand.com, a division of the NAJ Group, which publishes INBOUND. In our last issues Baker explained how Jeenie works. Essentially, she told us, “it’s three swipes with your thumb and you’re talking to a real person through facetime of simply audio.”
This week, we posed the question, “Why would anyone use Jeenie when there are auto-translate apps like Google Translate or ‘Speak and Translate’?” She answered: “When talking about language on a cellphone, it’s not actually about interpreting. We’re talking about people who speak the local language—in real time—to help you solve a problem. When you have 10 people behind you in line with 40 percent of them typing something into a phone, or with some of them turning the phone around to view, it’s a challenge. It’s not real time. Google language is great. I use it. But when they’re can’t handle speed, nuance or context … Jeenie works. It’s live. It’s real time.”
In the next issue of INBOUND, Kirsten Brecht Baker explains who Jeenie recruits as interpreters. For more on Baker’s professional background, visit: https://www.linkedin.com/in/kirsten-brecht-baker-7b866/.
At a Glance: Lake Charles, Louisiana
For the full Lake Charles, Louisiana: A perfect blend of gaming, the great outdoors & cuisine itinerary, click here.
HODGE PODGE: Shifts, Shakeups and Occasional Shaftings in the Tour and Travel Industry
Trudy Singh has been named regional vice president of sales, mid-Atlantic for New York City and Company. Previously, she was director of sales for the organization. Singh has been with NYC & Co. since 2000.
Leslie Dance, vice president of marketing and product development for the Hawaiian Tourism Authority (HTA), has resigned from her position effective May 15. The agency hired Dance on Jan. 5, 2016 after launching an executive search to fill the void left by the departure of David Uchiyama, HTA’s former vice president of brand management. Dance, 62, said she was leaving to return to the mainland to be closer to her family and plans to assist in formulating a transition plan before her departure
Jon Grutzner has been named by Insight Vacations and its affiliated Luxury Gold brand, both owned by The Travel Corporation (TTC), as USA president, replacing Phil Cappelli, who has been president for the past five years. Capelli decided to step down in order to spend more time with his family after a busy travel schedule supporting the brands’ travel agent partners. A tour and travel industry veteran with more than 25 years experience, Grutzner has served for the past six years he served as director of sales at Azamara Club Cruises. He has also held executive posts with Collette Vacations, Reader’s Digest and Carlson Leisure Group.
Linda Horowitz has been named tour and travel national and international sales manager for Visit Fairfax in northern Virginia. Horowitz replaces Melissa McClure, who is moving to Switzerland where she hopes to be a part of the tourism industry there. Previously, Horowitz was tourism services manager at Destination DC; prior to that, she was a research assistant at the U.S. Travel Association.
Travelport northern Europe managing director Simon Ferguson has been promoted to managing director, agency commerce for the Americas. He will relocate to Atlanta July 1st. He takes over from Bret Kidd who will be taking an alternative role within the company. Ferguson has led commercial, marketing and operational business in the UK, Ireland, the Nordics, Germany, Austria, Switzerland and the Benelux region for the last six years. He has previously held senior roles at Travelzoo and the Travel Weekly Group.
Eduard Bogatyr has been named the new general director of TUI Spain. Bogatyr, who has been with the company for two years, replaces Stefan Dapper, who leaves the organization after 20 years to become CEO of Expertia Travel (Condor Travel and Nuevo Mundo Viajes) in Lima, Peru. Before joining TUI Spain, Bogatyr had served as chief financial officer for companies such as the Compass Group, Rentokil Initial, Hertz and Tele2.
Ali Brewer has joined the National Law Enforcement Museum, a new attraction that opens in October in Washington D.C. where she’ll be a part of its group sales department. Previously, Brewer had worked for more than eight years at the American Bus Association.