INBOUND INTERVIEW—A Chat with Rafael Villanueva
Following NAJ’s Eighth Annual Active America China summit in Las Vegas, INBOUND sat down with Rafael Villanueva, senior director of international sales for the Las Vegas Convention and Visitors Authority (LVCVA) and talked about the destination’s growing international profile, as well as its ambitious goals for bringing more than 13 million international visitors a year to Las Vegas by the 2020-21 Fiscal Year. Following are excerpts from our discussion.
INBOUND: You’ve told us before that the CVA’s goal is to increase its percentage of international visitors to 30 percent of total visitors by Fiscal Year 2020-21. That’s up from 12 percent in 2008—about 4.5 million visitors—and the nearly 20 percent it is now. That’s a pretty ambitious goal. What prompted this, and what steps are you taking in order to reach that goal?
VILLANUEVA: Before the recession hit, we had developed an “International Vision” plan. China, as well as the other BRIC countries, played a vital role in our international development. Once we got to late 2008, things changed slightly, and we realized that this focus international was even more important.
We revised our strategy to immediately deal with this situation, while still being able to develop key markets for the future growth to Las Vegas. Our research told us that international travelers—while they’re not immune to changes in the economy—are going to travel, and travel to the US and Vegas recession or not. They stay longer, they spend more money, and this makes them an ideal visitor.
Rossi Ralenkotter (LVCVA’s president and CEO) communicated to the executive team, that the new international visitation goal was 30 percent. When my boss, Michael Goldsmith (Vice President of International Marketing) shared this news, it set me back in my seat. He said “The destination is doing its part by transforming itself into an international destination. We need to tell the world about it—show them and invite them to see for themselves.”
We are doing exactly that. We’re showing visitors that we don’t just have entertainment … we have the world’s best entertainment. We don’t just have shopping … we have world class shopping. We are truly a world class, international destination.
How does this happen? Our resorts, for instance, look at everything they do as part of their entertainment factor and how their guests perceive them. For them, a restaurant is more than just a meal … it’s an experience (He pointed to the Picasso restaurant in the Bellagio hotel, which has a collection of Picasso works on permanent display). They also do this with their entertainment. Cirque du Soleil has expanded its product, and you don’t have to speak or understand English to enjoy any of their eight shows. There is a 20,000-seat arena currently being built, and we have the new entertainment, dining, and shopping complex that recently opened between the Flamingo and the Linq Hotel and a new complex between the Monte Carlo and New York New York.
INBOUND: You’ve definitely got the room inventory to host the visitors—it’s more than 150,000 now, isn’t it?
VILLANUEVA: Right now, it’s between 150 and 152 thousand. It fluctuates. They’re always taking some out of inventory to refurbish and refresh them, but no one else is close to our total…and we’ve got more coming online in 2017, 2018 and 2019. Last year, we experienced an annual average of 86.6 percent occupancy—that’s over 127,000 rooms full every day last year.
INBOUND: Wow! Back to what it is you’re doing to go after the international visitor. How important is the Chinese market in reaching your goal of 30 percent?
VILLANUEVA: Extremely important—for two reasons. Number one, it has had amazing growth over the past two years and it is projected to grow even more over the next five years. Two, the potential represented by the customers, their spending habits and what they want to do is enormous.
INBOUND: When did you first decide to go after the Chinese market? As I recall, you were the first U.S. destination to have in-country representation in China—in Shanghai. Is this right?
VILLANUEVA: We’ve been going after China aggressively since 2008 when we hired our PR and communications firm, Brand Story (based in Shanghai), which is operated by Peter and Reene Ho-Phang. They have good marketing sense and they work well with the Chinese trade. But before we had this presence in China, it was former Lieutenant Governor Lorraine Hunt and Bruce Bommarito (former executive director of the Nevada Commission on Tourism), who began their own outreach and made Nevada the first state in the U.S. to have an office in Beijing authorized to promote tourism in China.
So, we were exposed to the customers before a lot of the other destinations. However, much of our success is due to the non-gaming element of what we have to offer. If you ever travel with us while promoting Las Vegas, you will never hear gaming mentioned during our presentations. There’s no need to. We now emphasize the variety of attractions, aside from gaming, that appeal to Chinese visitors, such as Las Vegas being the gateway to the Grand Canyon and the scenic Southwest.
I have to stress, though, that the market is still at the infancy stage for us. We still don’t have a non-stop direct flight from China, we’re very fortunate that we have great connections—and yes, we’re dependent on that.
INBOUND: How did hosting Active America China help you?
VILLANUEVA: It helped us several years ago, in 2011, when we hosted it for the first time. We did it for two purposes: First, for the delegates that Active America China brings us. It gives us the opportunity to showcase Las Vegas to the tour operators who come here. And second, it puts the market in front of our community … it places these Chinese operators in front of the people who want the Chinese business. And that is as valuable as conducting a sales mission to China.
INBOUND: Rossi Ralenkotter once said, “Everything we do is research-driven.”† Does this apply to the pursuit of the Chinese market as well? If so, in what ways?
VILLANUEVA: Indeed, we have a research department that looks at everything and we are proud to say we are a research-driven marketing organization. Unfortunately, as we start growing and developing new markets, including international, we are dependent on many other factors and outside sources. So when we have an opportunity to attend an event, such as the Asia Pacific Business Outlook, which we attended last week in Los Angeles, we take it. This helps us with learn more about countries that are important for Las Vegas. For me, it was one of those occasions when I felt like the least educated person in the room. In order to understand the travel picture, you need to understand all parts of the country and the total business outlook for the country—not just who the operators are—and our research department knows how to do that. They are able to put the travel outlook in context.
INBOUND: Speaking of operators—to what extent is the receptive tour operator community in the USA important to your international visitor growth? And what do receptives have to do to be a part of the strategy for LVCVA’s growth targets?
VILLANUEVA: U.S. receptive tour operators and tour operators are extremely important to us. In the past several years, the OTAs have been successful in bringing more traffic to Las Vegas. But, the further out the business is, the more that clients and customers need help. And receptives are not just selling the room, they’re selling the attractions, the guides, the services. They add value to what the client buys.
Also, it’s slightly complicated for an international operator to get a large portfolio of Las Vegas product on its own. Whether it is deposits, LOCs or contracted room block quantities, many times it is easier for the international operator and for the hotel in that case, to have a receptive operator handle the business. Plus, the receptive is selling, not buying the Las Vegas experience. And the success of Las Vegas is the experience. To put it another way, you can make more money selling attractions like the Grand Canyon as part of your Las Vegas package rather than just the hotel.
For us, it’s finding the right receptive operators for whom Las Vegas fits with their business model… and making it a success. And, when it comes to new or emerging markets, it means knowing which receptive out there are finding new operators that drive incremental visitation and not just taking away customers from their competitors.
INBOUND: Anything I’ve missed that you want to point out?
VILLANUEVA: Only that we’re still in our infancy in the world marketplace. We’re still new at this stuff. European nations have been working international markets, for decades. Can you imagine how this is going to be years from now?
Ctrip—China’s 800 Pound Gorilla Speaks Out
At nearly every NAJ RTO Summit and Active America China Summit for the past five years, every leading China market expert has spoken of the power and presence of Ctrip.com, the world’s third largest and China’s largest online travel agency (OTA). At NAJ’s recently convened Eighth Annual Active America China Summit held at the Bellagio hotel in Las Vegas, Ctrip itself made the point.
In a report that opened the conference, Rose Wu, manager, American Tour Department for Ctrip, went through a series of numbers—their size, in reference to a single overseas source market, had never been seen by the U.S. travel suppliers attending the summit as delegates—that were, at the very least, daunting. INBOUND culled its way through Wu’s report and arranged the figures so as to give justice to their statistical dimension. But first, a chart that best illustrates importance in the market to the USA.
Ctrip by the Numbers: Here is a breakdown of some of the key data points as they refer to Ctrip.
- 250 million: The number of Crtip members to whom Ctrip provides travel services in China—both online and through traditional travel service (this number would just about tie the agency’s client base with Indonesia for the fourth largest population in the world—behind that of China, India and the USA)
- 60: Percentage of the quarter billion Ctrip members that are classified as middle and high-end consumers
- More than 50: Ctrip’s percentage share of the online travel service market in China
- 7: The only small number in the presentation, it represents the OTA percentage share of total online penetration in China is small—compared to 31 percent globally—which means that there is considerable room for growth.
- 350 million: This is the number, so far, of downloads of Ctrip’s app, which has been used primarily for hotel bookings (45 percent) and flight tickets (35 percent)
- 10,000 (almost): The number of customer services representatives available 24/7.
- 1,026: Number of Ctrip packages to USA, including Group tours, FIT, cruises, day tour, transportation, ticket, etc
- About 48,000: Number of USA packages booked by Ctrip in 2014 (in 2012 it was 20,000).
Working with Brand USA: Wu made it a point to note the mega-agency’s partnership with Brand USA in promoting the U.S. both as a national destination and as a mega-brand backing up individual destinations, such as Chicago (below, right) within the U.S. She wanted to illustrate, particularly to DMO delegates to Active America, a channel open to them in order to promote their products through the Ctrip channel.
UK Traffic Gains Continued Growth Pattern through Winter Trough
The latest data from the UK Office for National Statistics (ONS) show that, while winter holiday departures to Canada and the USA do not mean much until they are seasonally adjusted (February, on its own, is usually the weakest month of the year for travel from the UK to North America), the trends suggested by the numbers shows that a steady recovery continues. Key numbers indicated the following:
- For the three-month period ending with February 2015, visitation to North America by UK residents is down 2 percent (down 1 percent overall);
- For the year-to-date period ending with February 2015, visitation to North America by UK residents was down 2 percent (down 1 percent overall);
- For the 12-month period ending with February 2015, visitation to North America by UK residents was up 8 percent (up 3 percent overall).
Outbound Visitation by UK Residents
|Outbound to North America
Outbound Visitation by UK Residents
|Outbound to North America
Is the Summer Travel Season Looking Up or Down for German Trade?
As March closed out with the Euro remaining stubbornly stuck at less than $1.10 on the currency exchange markets—this is down more than 20 percent what it was trading at the close of March 2014—at least one major travel marketing research firm released numbers showing that German travelers are growing reluctant to make bookings for this year’s peak travel season.
The Nuremberg-based market research firm GfK reported that, in March, based on its monthly survey of 1,200 leisure travel-focused agencies:
- Bookings for winter and summer holidays increased by just 1.7 percent,
- Summer 2015 sales were slightly better with a 2.8 percent rise; and
- The resulting cumulative increase was 5.9 percent.
The German travel trade publication, FVW, had its own take on the numbers calling the 1.7 percent monthly increase “surprisingly low” in contrast to a 10 percent increase for February and 6.4 percent cumulative increase, and taking into account the weak comparative month of March 2014, which marked the start of a weak bookings period through until last summer. For individual months, summer 2015 sales trends were relatively stable in March, said FVW. According to GfK:
- May now has a cumulative 20 increase rise in bookings;
- June is down by 4.6 percent; and
- Demand was also strong for August, which registered a 1.3 percent increase over last year, even though sales were 20 percent higher for the same month last year.
In contrast to the GfK report, another monthly survey—this one by Frankfurt-based Travel Agency Technology & Service (TATS)—had strikingly upbeat numbers. TATS, which evaluates figures from 2,400 flight-oriented travel agencies, reported that:
- The number of leisure travel advance bookings in March was 14.3 percent higher than a year ago;,
- Revenues for departures in March were 10.7 percent higher than the previous year;
- Leisure travel sales had a cumulative 6.2 percent rise for the first three months of 2015.
In China, F.I.T. is the New King, but Will Group Travel Never Go Away ?
Leading China expert Evan Saunders, who keynoted the recent Active America China Summit in Las Vegas, said that nothing should come as a surprise when it comes to measuring and analyzing the statistical dynamics of the market, which has changed utterly in its composition in just a decade. What used to be a predictable sample of group vs. independent traveler segments has changed to the point at which some two-thirds of outbound travelers are FIT. And, noted Saunders, the founder and CEO of Attract China, a firm that helps U.S. travel suppliers navigate the China market, as the market has evolved to a primarily FIT market, it has evolved in other ways as well.
In trying to put the dynamics of change in the travel industry into context, Saunders illustrated his point by showing how the skyline of Shanghai has changed from 1987 to present day.
Despite the dominant position of the FIT market segment, Saunders cautioned summit delegates on two points: first, “group travel will never go away” and, second, “the independent Chinese travelers has different needs … remember, they were actually group travelers just a few years ago.” He emphasized the uniqueness factor by noting that the Chinese travelers “are not the American tourists, they are not South Korean tourists … they are Chinese travelers.”
Key Differences: Saunders quickly went through some of the key differences between group and independent travelers.
- Group travelers want to see as much as they can within their limited budget, while independent travelers are not that concerned with price, they focus more on experiences.
- For ground transportation, group travelers still take the bus, while independent travelers look for options– rental automobiles, or event bicycles
- Groups go to Chinese restaurants to eat, to find familiar dishes, while independent travelers want to experience American cuisine.
- For translation needs, groups generally depend on their tour guide, while independent travelers: hires an English speaking tour guide; install translation apps on mobile devices; show pictures to natives; use body language; and make a detailed travel plan that makes them less reliant on strangers for help.
Things in Common: All Chinese tend to travel most during the same periods, avoiding departures in November and December, while clustering their departures during familiar holidays and vacation times. Last year, 17 percent of independent travelers departed on their holidays in January and February, with another 60 percent traveling from May through October. Major holiday periods are illustrated here.
Also, despite the group-FIT differences, most Chinese are looking for the same amenities when they travel abroad. That is, they want: free WiFi at hotels; tea kettles and slippers in their hotel rooms; Chinese cuisine served in their hotels; designated smoking areas (China is largest smoking country in the world); and merchants and vendors that honor the China UnionPay credit or debit card (the largest bank card I the world, Union Pay has a greater market share than Amex, Visa and Mastercard combined).
LGBT Travel Tidbit—Top Gay Bars in LA
Thanks to an item in the L.A. Times, we have a listing of the city’s top gay bars, prepared by Sharon Raiford Bush and Alan R. Carter. We’ve reformatted the list into the following table, which also contains excerpts from the article.
Top Gay Bars in Los Angeles
Bar and Location
8948 Santa Monica Boulevard
West Hollywood, CA 90069
|“The brainchild of restaurateur Lisa Vanderpump and her husband Ken Todd, PUMP Restaurant is technically a restaurant/bar, but nonetheless the local crowds come out to play at this beautiful eatery and hangout.”
7994 Santa Monica Boulevard
West Hollywood, CA 90046
|“Fubar gets a decidedly young crowd…do these boys have jobs? Don’t they have to get up in the morning? Monday night the young crowd dances to 80s music…”
692 N. Robertson Boulevard
West Hollywood, CA 90069
|“…has since been hailed ‘the best gay bar in the world’ by Logo TV. The now 16,000-square-foot food and drinking establishment has been featured prominently in a number of television projects”
8911 Santa Monica Boulevard
West Hollywood, CA 90069
|“…one of West Hollywood’s hottest places to see (and be seen) does not disappoint. Be warned: if you’re over 30, you will get looked at like you’re ready for your AARP card.”
8857 Santa Monica Blvd.
West Hollywood, CA 90069
|“For more than two decades, this oft-raucous nightspot has been one of L.A.’s hottest neighborhood bars. Guests are entertained by male go-go dancers, drag queens and provocative live shows on select evenings.”
8228 Santa Monica Boulevard
West Hollywood, CA 90046
|“Established in 1981, the joke around WeHo is that some of the original patrons haven’t left since they opened. And, yes, some affectionately call the place “Mold Coast” because the patrons tend to be older.”
8851 Santa Monica Blvd.
West Hollywood, CA 90069
|“A neighborhood favorite, this venue is a cross between a traditional gay lounge and go-go club. It’s become quite a hit among those looking for 80s and 90s dance music, popular videos and a delightful environment …”
4216 Melrose Avenue
Silverlake, CA 90029
|“This bar’s Facebook page boasts 1,121 friends and just about all of them are big, tattooed, hulking servings of macho … No worries. The guys might be bear-like, but they are quite friendly.”
8809 Santa Monica Blvd.
West Hollywood, CA 90069
|“A landmark in West Hollywood for more than 25 years, this genial venue remains a traditional gay sports bar that offers a bank of television monitors and strong cocktails at low costs. A toy train adds nostalgia to the pub’s décor …”
8944 Santa Monica Boulevard
West Hollywood, CA 90069
|“It’s not trendy or pretty or even fancy. But the neighborhood bar (it’s ‘Cheers’ without Carla or Cliff) is where men go to play pool or avoid the hair-flippers at some of the trendier joints.”
Source: L.A. Times
Kuoni Group Travel Experts Adds Team to drive Asian Group Tours USA
A new, dedicated sourcing and reservation team for Kuoni Group Travel Experts has been created to work with hotels and accommodation providers to bring more Asian travelers to key U.S. cities and national parks. Led by area sourcing and reservation manager, Matteo Provasnik, the team will be based in New York and on the West Coast but spend much of its time on the road searching and contracting for new product.
According to Kuoni Group Travel Experts, leading Asian source markets to the USA last year were Japan and Indonesia, although Brazil overtook China in the top five thanks to record economic expansion and job creation in the region. Both Japan and South Korea have enjoyed double digit growth.
Although key cities like New York, Boston, Los Angeles, San Francisco and Las Vegas remain the most popular American destinations for Kuoni Group Travel Experts, booking data reveals some surprising information:
- Virginia is the second most popular state after New York, serving as a base for visitors to explore the sights of Washington DC as well as its own attractions.
- China’s group travelers are drawn to Las Vegas.
- California is most popular for South Koreans.
NEW ATTRACTIONS—A Sampler of New Places and Experiences for the Visitor to the USA
- National Ag Center & Hall of Fame Reopens: After financial issues forced its closure for most of 2014, the National Agricultural Center & Hall of Fame in Bonner Springs, Kansas—it is near Kansas City—has reopened to the public with a new lease on life following the sale of some of its land that generated an infusion of cash designed to keep open the site, which has been especially popular with school groups ever since it opened in 1965. In addition to the extensive holdings at its 160-acre site, the attraction plans to host more special events and encourage more tourism. Some of the elements within the Ag Center-Hall of Fame complex include: the Gallery of Rural Art; National Agricultural Hall of Fame; Hall of Rural Living; National Farm Broadcasters Hall of Fame; Rural Electric Conference Theater; National Farmer’s Memorial; Museum of Farming; National Poultry Museum; and Farm Town U.S.A., a full-size recreation of a rural village. For more information, visit www.aghalloffame.com, or call 01.913.721.1075.
- New Textile Museum Opens in DC: A new museum has just is opened in downtown Washington D.C., showcasing a wide variety of art, history and culture through ancient textiles and a significant collection of maps and documents on the history of the nation’s capital. George Washington University is opening/reopening the $33 million Textile Museum, with its collection of artifacts that were gathered and displayed during the attraction’s nearly 90-year run at two other buildings another site in the nation’s capital before it closed down as the huge collection was transferred to a six-story site at GWU’s downtown campus. The opening of the new Textile Museum comes just months after George Washington University also acquired one of the nation’s oldest art museums, the Corcoran Gallery of Art, and its art school, demonstrating a major commitment to build a much larger profile as a school for the arts. For more information, visit www.museum.gwu.edu, or call 01.202.994.5200.
- John Wayne’s Iowa Birthplace to Open Museum in His Honor: On May 23rd, the small community of Winterset, Iowa is having the grand opening celebration for the John Wayne Birthplace Museum. Local officials, noting that more than a million people have visited the area to tour the four-room home to see where the legendary movie star of the 1930s, 40s, 50s and 60s who died in 1979, hope that the new 6,100-square-foot (566-square-meter) facility will be an attraction that will appeal to the millions who still remember the actor who specialized in roles that offered him up as a tall, strong hero. The only museum in the world dedicated to John Wayne, it will feature the largest diversified exhibit of John Wayne artifacts in existence, including movie posters, film wardrobe, scripts, letters, artwork and sculpture, one of his customized automobiles and a movie theater. For more information, visit http://johnwaynebirthplace.museum/, or call 01.515.462.1044.
HODGE PODGE—Shifting, Shakeups and Occasional Shaftings in the Tour and Travel Industry
Massachusetts Gov. Charlie Baker has named Rich Doucette as the state’s new executive director of travel & tourism. He reports to Jay Ash, secretary of Housing & Economic Development. Doucette replaces Betsy Wall, who held the position for the last seven years. Doucette has an extensive marketing background, having organized The Boston Cup Classic Car Show on the Boston Common and headed Shoppers Marketing, which helped companies in the downtown Boston area.
In Chicago, the Metropolitan Pier and Exposition Authority, also known as McPier—it operates the Navy Pier, the city’s most visited attraction, which draws more than 9 million visitors annually—has hired Chicagoan Lori Healey as its new chief executive. Healey, who previously served as chief of staff to former Mayor Richard M. Daley, took over from veteran Jim Reilly, who retired after three years in the position. Reilly had also served as McPier’s CEO from 1989 to 1999, and was also president and CEO of the Chicago CVB for several years. Before her appointment, Healey was CEO of Chicago-based investment firm Tur Partners, founded by Daley and his son Patrick; she also served as executive director of the NATO summit host committee.
Mike Waterman has been named president of the Greater Houston CVB and executive vice-president of Houston First Corporation (HFC). Last year, the CVB and HFC boards approved a strategic alignment between the two organizations. As part of that agreement, CVB employees became employees of HFC while the bureau maintained its own board of directors and gained seats on the HFC board. Waterman comes to the position from Marriott International where he most recently served as vice-president of sales for the Southwest region.
Abta (formerly the Association of British Travel Agents) has appointed Victoria Bacon as its new head of brand and business development. Bacon, who left Abta just months ago, will focus on the development of the “Abta Travel with Confidence” brand, and on Abta’s commercial activities as well as directing the communications function
Sunwing Travel Group has announced the appointment of Stuart Morris as general manager, Morris will responsible for the group’s retail division which comprises the full service travel agency, SellOffVacations.com and specialist wedding planners, Luxe Destination Weddings.
Amanda Wills, described by Sir Richard Branson as “a legend within the travel industry” has joined the board of travel-themed social network talkholiday. Wills was the managing director of Virgin Holidays for 13 years until her departure in 2014. She joins talkholiday in a non-executive role with a brief to increase brand awareness through commercial partnerships and as the principal strategist in the travel sector.