Global Hospitality News: eHotelier Newsletter

Changing Travel Patterns Force Travel Suppliers To Re-Think Marketing Plans - TIA Reports

A survey of the Travel Industry Association of America's (TIA) 2,300 member organizations shows that changes in consumer travel patterns have greatly affected how they market their destinations and services. Three-fourths of TIA members see closer to home travel and more last minute travel among their customers. Nearly as many report fewer international visitors, more car travel, and lower travel expenditures. On the plus side, nearly half of TIA members are enjoying increased use of their web sites by potential customers. In the past year, most (87%) TIA member organizations have made changes to marketing and/or promotion programs. The study is a follow up of TIA's September, 2001 examination of the immediate impacts following September 11 and the economic downturn.

Seventy-seven percent have focused their marketing and promotion efforts on closer, drive-to markets in the past 12 months. And 66 percent have offered new discounted rates and packages. But while 68 percent of TIA members are optimistic that their businesses will improve in 2003, 40 percent report reductions in staff, salaries, or bonuses in the previous 12 months.

"The current economic situation, combined with a sluggish travel recovery and a decrease in traveler spending has forced the industry to employ a number of strategies, such as focusing on in-state or in-region markets," remarked Dr. Suzanne Cook, senior vice president of research for the Travel Industry Association of America. "And just as TIA is doing on a national level, about half of our members are involved in more partnerships as a way to leverage scarce resources and make more impact."

One-third of TIA members have increased their marketing and advertising budgets in 2002, and a similar percentage say that they will be increasing them also in 2003. While about one-quarte have cut those budgets in 2002, only 9 percent plan to do so next year.

In 2001, 64 percent of TIA members suffered declines in business. However, nearly one-third of respondents actually did better in 2001 than the year before. In 2002, travel industry recovery continues to be a mixed bag, with nearly half of respondents enjoying increases in business over last year. On the other hand, 41 percent continue to suffer declines.

The biggest declines in travel volume are reported by organizations that primarily serve international inbound visitors, by travel agencies and tour operators, and by larger businesses with 100 employees or more. However, travel businesses in the Midwest, as well as attractions and domestic marketing organizations operating in more rural areas of the country are doing better than others.

While the decline in air travel negatively affected two-thirds of TIA members, it was actually beneficial to about 16 percent. Specifically, places close to major population centers that were able to attract visitors who shifted to closer-to-home travel by car. Not surprisingly, the continuing decline in business travel and business travel spending has negatively affected 68 percent of TIA member businesses.

TIA is the national, non-profit organization representing all components of the $537 billion travel industry. TIA's mission is to represent the whole of the U.S. travel industry to promote and facilitate increased travel to and within the United States.

SAN JUAN, Puerto Rico (December 5, 2002) -- Gold Book Publishing (GBP), a division of the Caribbean Hotel Association (CHA), is pleased to announce the launching in April 2003 of a new meetings and events program – Caribbean Meetings & Events. “Caribbean Meetings & Events seeks to fill the need of a single, all-inclusive resource and reference guide to the meetings and events market in the Caribbean region. Our goal is to promote the Caribbean region as a primary destination for the Meetings & Events industry and to stimulate ‘group’ business for those Caribbean destinations and resorts with meetings, incentive and convention facilities,” said GBP Publisher Tim Grace. The program, which includes an annual meetings magazine and directory, an electronic newsletter, and a searchable website, is targeted to a highly-qualified database of approximately 12,500 meeting and incentive planners. “This new program in Gold Book Publishing’s portfolio supports the range of CHA marketing initiatives to increase the visitor market share to the Caribbean,” added Alec Sanguinetti, newly-appointed director general and CEO of the CHA.

The Caribbean Meetings & Events annual publication and website will include editorial coverage of the Caribbean and its unique benefits as a meetings, conventions, incentive and events destination, with factual data relative to meetings on all Caribbean destinations - maps, flight times, taxis, taxes, meetings capacity, etc. In addition, a comprehensive hotel directory and index by country will be presented, from the mega-resorts that can accommodate 1,000+ delegates to the small boutique hotels ideal for executive retreats. Country listings will also include on-island attractions, ground tour operators, other meeting facilities, group restaurants, etc.

Connie Goldstein has signed on as Editor of the Caribbean Meetings & Events program. “We are thrilled to have Connie onboard. She is a well known, respected authority in the meetings market,” added Tim Grace. Goldstein founded Corporate Meetings & Incentive Magazine in 1982 and is a former Executive Editor of Successful Meetings magazine. For the past five years, she has been a monthly columnist, as well as editor and associate publisher, for the Sales Marketing Network.

Caribbean hotels will receive a free hotel listing in the publication and website, in order to ensure a comprehensive database of meeting facilities in the region. Each listing will cover details such as the total number of meeting rooms, the capacity of the largest meeting room (in terms of the number of people the room can hold), the total amount of meeting space in square feet, and the total amount of exhibition space in square feet. The deadline to submit hotel information for the inaugural April 2003 edition is January 31st, 2003.

/PRNewswire/ -- National award-winning hospitality executive John P. Langley today announces the formation of American Hotel Management, Inc., to provide a full range of hotel management services, specializing in asset management and consultancy.

AHM concentrates on creating a balanced scorecard, that is, maximum investment value for our client partners, reports Langley, Chief Executive Officer and President of the new Boca Raton, Florida-based corporation. We accomplish that by increasing sales revenue, maximizing profit and providing quality service.

An important service component is AHM's unique Quality Service Training program. Designed for both management and hourly staff, this program focuses on quality-service techniques and customer retention. Team members learn how to hold themselves and their staff more accountable to create increased operations and sales efficiencies. The improved quality and service, in turn, grows team spirit, leads to improved profits and gives ownership a competitive edge.

AHM offers hotel owners experience in every hotel discipline, offering sales and marketing, revenue management, human resources, accounting, front office technology, food and beverage, maintenance and housekeeping expertise. Personalized business plans include operating and capital improvement budgets as well as sales and marketing plans.

CEO Langley brings more than 20 years of executive hospitality management experience to AHM. Most recently, he was Senior Vice President and Director of Operations for Innkeepers Hospitality, Inc, the hotel management company for Innkeepers USA, a real estate investment trust. He was responsible for more than 40 hotels, including brands like Residence Inn by Marriott, Hampton Inn by Hilton, and Holiday Inn Express.

Key accomplishments include developing the company's first Quality Service Program; participating in its successful IPO, which raised $60 million dollars; and spearheading six years contiguous annual Gross Operating Profit and Net Operating Income growth. In 2000, he surpassed industry Revpar growth by 150% leading to $105 million in annual sales.

Many hotels under Langley's direction achieved top hospitality quality, service and sales awards, such as the Residence Inn Gold and Silver Quest for Quality Awards. Langley has been recognized and awarded by associates and ownership with Partnership Awards and V.P. of Operations of the Year for outstanding service. He is a former member of the prestigious Residence Inn by Marriott System Standards and Technology Committees.

China - Inbound tourists up 11% in Jan.-Oct.

China Online - Some 81.575 million overseas tourists visited China during the first 10 months of the year, an increase of 11.19 percent over the same period last year.

The visitors included 11.4588 million foreign citizens, up 22.18 percent; 51.4136 million Hong Kongresidents, up 6.32 percent; 15.5112 million Macauresidents, up 22.12 percent; and 3.1914 million Taiwanresidents, up 9.01 percent, according to the latest statistics from the China National Tourism Administration (CNTA).

In October, China received 8.6957 million overseas visitors, an increase of 14.75 percent year on year. Tourists from 13 out of the 15 major source countries recorded over 20-percent growth, with those from Thailand up 69.79 percent, those from Malaysia up 49.28 percent and those from Japan up 46.14 percent.

During the January-October period, visitors from all the 15 major source countries recorded two-digit growth, with those from Indonesia up 33.31 percent, those from South Korea up 32.16 percent and those from the Philippines up 31.85 percent.

The CNTA statistics also show that foreign exchange revenues from the tourism industry expanded by 23.65 percent year on year to US$ 1.975 billion in October and 16.02 percent to US$ 17,196 billion in the first 10 months.

For more information on China's tourism industry, see the tourism & recreation sectionof ChinaOnline's eBookstore. ChinaOnline, 2002. All Rights Reserved. For more information, visit http://www.chinaonline.com.

The Vancouver 2010 Bid Corporation welcomes the announcement by the Governments of Canada and British Columbia confirming the expansion of the Vancouver Convention and Exhibition Center. "The new convention center will provide top facilities to house the world's media during the 2010 Olympic and Paralympic Games," said Jack Poole, chairman and chief executive officer of the Vancouver 2010 Bid Corporation. "Today's announcement shows how bidding for the Winter Games can be a catalyst for much- needed infrastructure projects to benefit our communities over the long term. Having Prime Minister Jean Chretien, BC Premier Gordon Campbell and Vancouver's new Mayor, Larry Campbell confirm that the expansion will be completed before the Games begin is a tremendous boost for Canada's Bid."

The Vancouver Convention and Exhibition Center project is targeted at $495 million. The Tourism sector will contribute $90 million. The federal and provincial governments will contribute the remainder on a matching cost-shared basis. "The waterfront setting of Vancouver's convention center will provide a stunning backdrop for the estimated 10,000 media members who would cover the 2010 Winter Games," added Poole. "Located in the heart of Downtown Vancouver, within walking distance to major competition and ceremony venues and with spectacular mountain views, the new Convention Center will add to the unique experience of Canada's Sea to Sky Games."

The Vancouver Convention and Exhibition Center project includes the construction of new facilities west of the existing centre at Canada Place and the linking of the two sites to form an integrated convention and exhibition centre.

Vancouver is Canada's Candidate City for the 2010 Olympic Winter Games and Paralympic Winter Games. Member partners of the Vancouver 2010 Bid Corporation are the Government of Canada, the Province of British Columbia, the City of Vancouver, the Resort Municipality of Whistler and the Canadian Olympic Committee. The Bid Corporation's board of directors is drawn from a variety of community interests, including all levels of government, First Nations, and the business and sport communities. The Bid Corporation is supported by more than 100 companies, corporations and organizations. The IOC will select the host of the 2010 Winter Games in July 2003.

Times News Network - It's now official. The year gone by has been the worst one for the Indian hospitality industry. The extent of damage has been calculated by a survey conducted by Pannell Kerr Forster (PKF), leading consultant, accountant and business advisors in the UK.

In the last financial year (2001-02), the Indian hotel industry saw a decline of 23.7 per cent in income before fixed charges (IBFC) on a per available room basis, the report says. IBFC for the industry now stands at 31.2 per cent of total revenue.

The survey tracks the performance and profitability of quality chain and independent hotels in India and is based on the audited profit and loss accounts of over 100 chain and independent hotels across the country. This is the third profit and loss survey of the Indian hotel industry done by PKF in the last four years.

The survey points out that as compared to other geographies, India was the worst hit, pummelled both by global events following 9/11 and terrorist incidents and panic about war with Pakistan. The industry IBFC last year was at 36.9 per cent.

“These results show just how dependent quality hotels in India are on the international traveller and how susceptible Indian tourism is to the global, regional and national security environment. Being part of a region that is troubled on the whole, and with over 95 per cent of our international arrivals by air, we need to act resolutely to remove all persisting constraints on increased international travel to India. The industry also needs to focus much more on the domestic traveller,” says Uttam Dave, CEO, PKF Consultants.

Along with earnings, hotel occupancy also fell from 61.1 per cent in 2000-01 to 56.4 per cent in 2001-02. And that’s not the end of the bad news.

Average achieved room rates fell by a further 6.8 per cent, resulting in a decline of 16 per cent in rooms yield or revenue per available room.

In addition, the industry is actually incurring more costs to obtain business -- rooms division costs went up by 5.6 per cent, probably due to the variety of freebies now being offered.

The declining occupancy rate took its toll on food and beverage revenues as well. While food sales mostly held up, declining only 3 per cent, thanks to non-resident sales, beverage revenues declined 12 per cent.

Meanwhile, revenues from telecom are increasingly marginally in hotels, with declining call charges and increasing use of mobile phones. In fact, telephone revenues on a per available room basis declined 24 per cent last financial year.

The survey says that the overall operated departments’ revenues for hotels in India declined by 14.1 per cent. While the industry appears to have responded by cost-saving measures, these have been inadequate to compensate for the significant loss in revenue. In fact, operating costs declined just 1 per cent while undistributed expenses declined by a mere 2.3 per cent.

VOA - China took a step toward getting its first international-class theme park on Saturday. If the preliminary deal with Universal Studios succeeds, the park will entertain millions and employ thousands in Shanghai.

The Universal Studios theme park is expected to cost hundreds of millions of dollars and be built around thrill rides based on popular movies like Jurassic Park and Spider Man. The park will also mix Hollywood with traditional Chinese themes.

The first phase of construction may begin next year and would fill 80 hectares in Shanghai's Pudong development area. Shanghai is China's largest and richest city and considered a lucrative market for the country's fast-growing domestic tourism industry.

U.S.-based Universal Studios is working with two Chinese companies on the project. The deal still needs approval from the central government in Beijing, but the agreement was signed by a ranking member of the Shanghai Communist Party, indicating it enjoys high-level support.

The deal comes as rival Walt Disney Company is building a $1.8 billion theme park in Hong Kong, due to open in 2005 or 2006. Disney has also reportedly been discussing a theme park in the Shanghai area, but Universal seems to have beat Disney to the punch.

The News Network - The Hong Kong-based premium chain, Mandarin Oriental has entered the fray for a strategic tie up with Umesh Saraf’s The Grand in Delhi (earlier Grand Hyatt).

Mandarin Oriental had earlier ended its tie up with the spa, Ananda in the Himalayas citing breach of contract as the main reason.

When contacted, officials at The Grand confirmed being in talks with the Mandarin group and said that after a mutual parting of ways with Hyatt, it is looking at a premium positioning in terms of a tie-up. The group is also in talks with the Marriott and Raffles chains.

The 390-room hotel, The Grand is a part of Unison hotels controlled by Mr Saraf. Interestingly, Unison had also won the privatisation bid for Hotel Ranjit in a tie up with the Reliance group.

Mandarin Oriental owns or operates 18 high-end hotels in Asia, Europe, and North America. The company has equity stakes in about 80% of its properties, which include flagship and founding property the Mandarin Oriental (Hong Kong), as well as the Mandarin Oriental Hyde Park (London), Hotel Majapahit (Surabaya), and the Kahala Mandarin Oriental (Hawaii).

Mandarin is looking at establishing the Mandarin name as a global brand through organic growth and acquisitions; the company currently has hotels under development in New York City, Tokyo, and Washington, DC. Hong Kong-based trading conglomerate Jardine Matheson owns about 66% of Mandarin Oriental International.

The deal between Hyatt and the Sarafs did not last too long and it is learnt that both of them reasons for disengaging. Sources said that the advantages in signing up with an Asian chain is that there is greater cultural affinity and understanding.

Also, the Asian chains are looking at expanding rapidly into other large overseas travel markets like India and are committed to growing here.

Sources said Mr Saraf is primarily looking for a tieup with a company with better business commitments. He, however, is not interested in entering into an equity partnership for the

Mena Report - The slight slowdown in tourism to the Middle East in 2002 is to be followed by a recovery in 2003, reported hospitality market valuator, HVS International. Historically, economic contractions in the Middle East have lasted for one or two years with a subsequent recovery in the following year.

The 2002 edition of HVS International’s report on Trends and Opportunities for Hotels in the Middle East confirms a significant decline in the performance of hotels throughout the region in 2001. However, the authors commented that the decline in performance is likely to result in some investment opportunities for hotel investors.

The survey reports on a sample of 108, mostly branded, first-class hotels. These hotels represent more than 32,000 rooms in ten countries throughout the Middle East. Whilst the events of September 11 made their mark across the globe, the Middle East and North African regions were the worst affected by the aftermath. The number of tourist arrivals in the Middle East decreased by 8.7 percent in 2001, compared to 2000.

However, some countries like the United Arab Emirates (UAE), Lebanon and Syria were still able to experience growth in tourism arrivals for the full year 2001, which was mainly driven by increased regional Arab visitation.

The report confirms that region wide hotel occupancy was down by four percentage points in 2001 to 64 percent, largely due to the global economic slowdown, which was exacerbated by the events of September 11. Similarly, average rates fell by approximately five percent, to $84. This was caused by the decline in demand, combined with the increased hotel supply in the region, and more aggressive pricing, in an attempt to stimulate demand. Many tourism projects are already planned in the Middle East and their development is not likely to be delayed by the current political instability.

In addition, Asian operators such as Dusit, Shangri-La Hotels and GHM Hotels are planning to expand in the Middle East, which will hopefully contribute to boosting Asian visitation to the region. According to the authors, while hotel development is likely to slow down somewhat in the short term, opportunities may arise for financially strong and liquid local investors to benefit from a delayed presence of international capital. Due to the turbulent environment in some countries, several independent hotels are likely to face periods of financial hardship and cash liquidity.

This is likely to result in opportunities for cash holders either to acquire the properties at depressed prices or to act as a third party and buy the loans associated with these properties at low ratios.

As for new hotel development opportunities, the authors note that the main hotel developments in the region generally have been, and still are, geared towards the construction of full service properties in the Middle Eastern capitals.

However, opportunities are most likely to arise for the development of branded mid-market hotels, serviced apartments, time-share units, and other leisure facilities either in the main cities or in some secondary locations, which are currently not identified for potential hotel investments.

HVS International is the trading name of SG&R Valuation Services Company, an American partnership formed by S R London Corporation and HEI International. — (menareport.com)

The Advertiser - One of Australia’s most historic hotels was saved from bushfires last night – but only after desperate efforts by firefighters and waterbombing helicopters.

Fanned by strong winds, the flames roared up steep valleys and came within metres of the 122-year-old Hydro Majestic Hotel, 115km west of Sydney in the Blue Mountains.

About 50 guests and staff who elected to stay inside could only watch in disbelief as the blaze raced towards them.

The fire engulfed a fibro cottage adjoining the opulent main building, destroyed another house in the area, and injured a firefighter.

NSW Fire Brigades spokesman Ian Krimmer said it was a "miracle" the building had survived.

"The hotel itself has escaped without any damage apart from a little bit of singeing around the edges," he said.

However, by 7pm winds had eased and firefighters had managed to stave off flames.

The focus of firefighters then switched to homes at Berowra on Sydney's northern fringe.

However, for the first time, Rural Fire Service Commissioner Phil Koperberg said the end of the five-day crisis was in sight.

Cold and rainy conditions are forecast for tomorrow and containment lines established over the weekend have halted the worst fire fronts.

"We are nearing the end of this particular fire crisis. All of the containment lines held today, except for the Blue Mountains," he said.

"But if we get cold and moist conditions on Tuesday, then it's fair to say that by Tuesday or Wednesday all of this will be mopped up. It's been a superhuman effort."

Prime Minister John Howard toured devastated regions yesterday and paid tribute to the 4500 firefighters – including volunteers from South Australia and Victoria – who have been fighting the Sydney blazes.

A second contingent of SA firefighters will head to Sydney tomorrow to replace 80 who arrived on Saturday.

"On behalf of all Australians, can I say how proud I am of the magnificent work of the men and women volunteers and firefighters," Mr Howard said.

He pledged Commonwealth financial assistance to help NSW pay the spiralling relief costs.

NSW Premier Bob Carr said the fires would cost the state more than $100 million.

Meanwhile, the helitanker dubbed Elvis – capable of dumping 9000 litres of water at a time – will arrive today to join two other tankers, Georgia Peach and The Incredible Hulk, on the firefront today.

TTG Asia - Thailand and Indonesia, the South-east Asian countries whose popular beach resorts were subject of many security warnings recently, are taking fresh steps to protect visitors.

The Tourism Authority of Thailand (TAT) is mounting a nation-wide security training programme to raise levels of vigilance among hotel staff in major tourist destinations.

Bomb disposal experts attached to police and army units will conduct the courses, which have been designed to explain to participants how terrorists operate and what to look for to prevent their activities.

TAT training services division director, Ms Arunsee Sataniti, said she expected some 4,000 people to attend the courses and each would be asked to teach at least 10 others in their respective properties.

Meanwhile, the Indonesian government will lobby Indonesian insurance companies to enhance their services for tourism-related categories.

Indonesia Minister for Culture and Tourism, Mr I Gede Ardika, said: “We are going to talk to the national insurance companies to create programmes they have not covered, for example, to cover meetings, conference speakers, etc.” The other area is insurance policies related to terrorism for travellers.

Newsletter - December 10, 2002