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Newsletter - January 10, 2002

DO YOU KNOW WHERE YOUR HOTEL IS IN CYBERSPACE?

By Max Starkov and Jason Price

How can hoteliers deal successfully with today's challenges and emerge as winners from the present travel and economic downturn?  Smith Travel Research forecasts full-year 2001 U.S. hotel occupancy at 60.7%, down 4.7 percent from last year. RevPAR for the year is expected to be down 4.3 percent and ADR to be at 2000 level or lower. PricewaterhouseCoopers categorizes this as " the worst performance in 33 years".

The Internet can be your best ally--your eDistribution strategy can play a major role in softening the disastrous effects of the recent events and the economic slump and will, over longer-term, define the winners in these trying times.

Why eDistribution? And why right now? First of all, eDistribution is by far the lowest cost channel of distribution. Used properly it increases occupancy rates, improves the bottom line, opens new markets and attracts more affluent customers in these difficult times. The booking engine on the hotel website is a good starting point for any eDistribution strategy. But hoteliers should remember that this is only a small part of what eDistribution is all about.

Did you know? Over 162 million Americans are active Internet users (Nielsen) and 37 million of them have already purchased travel online. The online travel bookings exceeded $23B in 2001 and are expected to reach $63B by 2005

The average online traveler comes from a household that earns $72,000 (Forrester Research) and can afford to travel even in the current situation. All business travelers are savvy Internet users. Aren't these exactly the customers you would love to have at your hotel? Hoteliers are beginning to realize that online distribution is changing the "classic" distribution spectrum. Internet-based reservations will triple to 15.4% by 2004 from the current 5.4 percent (Andersen LLP). Five years from now there will be more Internet hotel sales than GDS hotel sales.

Here are just a few questions you should consider with utmost urgency, as part of your hotel's   resolutions for 2002:

Did you know that 85% of Internet users rely on search engines to locate information on the Web? (e.g. Yahoo, AltaVista, Google). Did you know most Internet users will not book a hotel that does not offer a real-time booking on its website?   Do you know where your hotel is in cyberspace? Is it among the top 40 hotels on the major search engines? Does your website produce more than 6% of your overall bookings? Do you have a real-time booking engine? And if you have a booking engine is it capable of booking in real-time transient, group, corporate rates, preferred rates, special accounts and promotional rates? Do you offer a full array of hotel packages, family packages, and weekend specials on your website? Is your website registered and positioned well on the top 400 search engines? Are you ready for the Mobile Internet and do you offer your savvy travelers a wireless booking service?

eDistribution and its components: hotel website optimization strategy, search engine strategy, online distribution channel strategy, online marketing strategy, etc can help you find answers to all of these important questions and can play a major role in softening the disastrous effects of the terrorist attacks and the economic slump and will, in the longer-term, define the winners in these trying times.

 

How well is your website working for you?  The attached “Internet Evaluation Form: Your 2002 Hotel Internet ID ” can tell you where you stand.

Internet Evaluation Form: Your 2002 Hotel Internet ID

 

Positioning of your hotel on major search engines: Earn points only if among top 30 listings when searching for "Hotels in …" (your destination)

  • Yahoo.com
  • Google.com
  • Looksmart.com
  • AltaVista.com
  • GoTo.com

 

Points

 

5

5

5

5

4

 

Your Score

 

Positioning of your hotel on online travel services: Earn points only if among top 30 listings when searching for "Hotels in …" (your destination)

  • Expedia.com
  • Travelocity.com
  • Orbitz.com
  • Trip.com

 

 

 

4

4

4

4

 

 

Hotel Website Functionality

  • Customer e-mail capture
  • Rich Media (360-degree tours, live Web cams, hotel videos)
  • CRM tools (e-mail, instant messaging, live agent, chat room)
  • Foreign language(s) hotel description
  • Online concierge (e.g. book Broadway shows, restaurants, etc)
  • Affiliate Program (links from other sites to your website)
  • Map of surrounding area, location, hotel description, hotel photos
  • Description of entertainment and restaurants in vicinity

 

 

5

4

4

3

3

5

3

2

 

 

Online reservations:

  • Do you offer a 24/7 real-time booking engine on your website?
  • If you have a 24/7 booking engine, does it offer bookings for:
    • Rack rates
    • Special packages
    • Corporate rates and special accounts
    • Groups and convention housing
    • Do you pay travel agent commissions

 

 

5

 

4

5

5

5

4

 

 

Do you have an online store?

  • Selling hotel gifts, spa replenishment products, etc
  • Selling local memorabilia

 

 

4

4

 

 

Hotel collaterals:

  • Do you feature your website on hotel fliers, brochures, confirmations?
  • Do you refer to your website on the hotel automated phone system?

 

 

3

2

 

 

Total:

 

 

110

 

 

How to read your score:

85 points and above: You are ahead of the curve. Now it’s time to enhance your website and eDistribution strategies.

 

60 to 84 points: You are missing on significant opportunities to generate incremental revenues and lower costs. 

You need to implement a comprehensive Website Optimization Strategy and eDistribution Strategy to be able to stay competitive.

 

Below 59 points: Your future competitiveness is at stake and you are behind your peers. You should urgently adopt a comprehensive plan to embrace robust Website Optimization, eMarketing and eDistribution strategies.  

About the authors:

Max Starkov is Chief eBusiness Strategist at Hospitality eBusiness Strategies, Inc. in New York City. He advises companies in the Travel and Hospitality verticals on their eBusiness and eDistribution strategies. Max has 17 years experience in pioneering and building successful travel and hospitality businesses and eBusiness strategies for national and multinational leisure and hospitality companies. Max has an extensive eBusiness experience having co-founded and served as CEO and Director of two eBusiness companies. Under his leadership one of these companies won the prestigious 2001 Worldwide Microsoft RAD Award for Web-based  technology applications (CRS and booking systems) for hospitality.  He also teaches graduate courses on "Hospitality/Tourism eDistribution Systems" and "e-Travel" at New York University's prestigious Tisch Center for Hospitality, Tourism and Travel Administration. You can reach Max at max@hospitalityebusiness.com
website:  www.hospitalityebusiness.com

Jason Price is Vice President of Business Development and Strategic Marketing at Hospitality eBusiness Strategies, Inc. in New York City. Jason advises companies in the Travel and Hospitality verticals. Jason helped build and served as the Vice President of two eBusiness companies. Jason was in the leading team that won the prestigious 2001 Microsoft RAD Award. Jason has over five years experience in pioneering and building successful travel and hospitality Internet businesses and another six years building critical business units for major Madison Ave marketing companies. You can reach Jason at jason@hospitalityebusiness.com

NEW HOTEL MANAGEMENT COMPANY FORMED TO PROMOTE SIGNATURE CARMEL VALLEY RESORTS

The Hongkong and Shanghai Hotels, Limited (HSH) and Baylaurel LLC, announced today that they have formed Valley Resort Management LLC to promote and develop the owners' respective properties, Quail Lodge Resort and Golf Club and Bernardus Lodge.

The new company will oversee the operation, marketing and further development of both resorts, leveraging the strength of the two hotel brands and increasing their marketing reach. The opportunity also exists of future expansion by taking on similar properties.

Individual ownership of the resorts is unchanged, however, with both HSH and Baylaurel remaining committed to their respective hotels within their shared market niche.

James A. Cecil, currently general manager of Bernardus Lodge and chief operating officer of Baylaurel LLC, assumes the role of managing director of Valley Resort Management. In this position, he is responsible for developing all marketing and operations strategies for both the 97-room Quail Lodge Resort and the 57-room Bernardus Lodge.

"The hotels are recognized as two of the top destinations on the Monterey peninsula," said Cecil. "The establishment of Valley Resort Management provides fresh impetus for both resorts to capitalize on their respective strengths and to maximize their potential."

About The Hongkong and Shanghai Hotels, Limited

The principal business of The Hongkong and Shanghai Hotels, Limited is the ownership and management of prestigious hotel, commercial and residential properties in key destinations in Asia and the USA. Within its hotel management division, The Peninsula Group, properties in gateway cities include: The Peninsula Hong Kong; The Peninsula Bangkok; The Peninsula Manila; The Peninsula New York; The Peninsula Chicago; The Peninsula Beverly Hills; The Palace Hotel Beijing; The Kowloon Hotel, Hong Kong; and the 97-room Quail Lodge Resort and Golf Club, Carmel, California.

About Baylaurel LLC

Baylaurel LLC is the owner of Bernardus Lodge and the Bernardus Winery and Vineyard. Bernardus Lodge features 57 luxurious suites, the award-winning Marinus restaurant, a full-service spa, swimming pool and outdoor warming pool, two tennis courts and a croquet lawn. Bernardus Lodge is the recipient of Mobil's prestigious Four Star rating for both the Lodge and Marinus and is a member of the Small Luxury Hotels of the World(R). Bernardus Winery and Vineyard features 210 acres and currently produces several award-winning varietals, including the flagship Marinus blend, as well as Sauvignon Blanc and Chardonnay.

CLUB MED CLOSES SIX MORE VILLAGES UNDER SHADOW OF TERRORISM

 
Club Mediterranee has been hard hit by gloom in the tourist industry caused by the September 11 attacks in the United States and is to close six more villages, it said on Tuesday.

In the year to the end of October the holiday group made a net loss of 70 million euros from a profit of 59 million euros (62.3 million dollars) in the previous year, the company said in a statement.

The loss corresponds broadly to the cost of cutbacks although the company said that the effects of the attacks on September 11 amounted to 23 million euros. Operating profit was halved to 50 million euros

The net loss was in line with forecasts by analysts. The board said that it was recommending that no dividend by paid for 2001.

Club Med said that in 2002 it would close six of its "2-Tridents" range of villages which were insufficiently profitable. These closures were in addition to 17 firm or provisional closures already announced for the winter season.

Group president Philippe Bourguignon said: "The complexity and seriousness of the crisis affecting the tourism and travel industry, particularly since the attacks on September 11, have had a big effect on our results in 2001.

"They will have consequences for the winter season in 2001/2002 because consumers are still delaying decisions."

The board said that all measures taken by the company since September 11 would generate recurrent annual savings of 30 million to 40 million euros.

The company said that since the terrorist attacks in the United States on Septemebr 11, consumers had changed their booking habits, reserving late. Late booking had increased reservations at its European ski resorts by 13.1 percent.

But this meant that the company could not forecast its performance.

The figures for 2001 included an exceptional loss of 71 million euros, of which 60 million euros was in respect of the closure of villages and shedding of 243 jobs in response to the effects of the attacks in the United States.

But overall sales had risen by 5.0 percent to 1.985 billion euros.

However this increase was not enough to meet increased fixed costs arising from the creation of new holiday facilities in 2001.

Operating profit amounted to 50 million euros from 103 million euros in 2000, owing to "the negative impact of 23 million euros from the events of September 11".

In 2001 Club Med increased its holiday capacity by 5.8 percent. and the average rate of occupancy was 72.0 percent.



BERLIN TOURISM BUBBLE HAS BURST, BUT RECOVERY IN SIGHT


Berlin (dpa) "The boom in Berlin's tourism industry is over for now, but things will start to recover by the middle of 2002," predicts Peter Nerger, director of Berlin Tourismus Marketing GmbH.

Tourism to the German capital broke all records in 2000 after reunification and the German government's move to Berlin. But the city attracted fewer visitors in 2001, and the local tourism industry is not expecting any vast increases in 2002.

Berlin still has better chances than many other European tourist destinations, said Nerger. But it also has more potentially empty hotel beds.

"We face some hard times ahead," Nerger already warned last October. The economic slump had already dampened expectations, then came the September 11 terror attacks in the U.S. which abruptly turned the steady stream of visitors to a trickle. Overseas visitors stayed at home, some trade fairs scheduled to host up to 2,500 participants were cancelled. Hotels saw business drop by a heavy 20 per cent.

This was a shock for the German capital that had enjoyed a record year of 10 million overnight stays in 2000 and was hoping for two- figure growth rates in 2001.

The Reichstag, Brandenburg Gate, Potsdamer Platz and the Jewish Museum had been visitor magnets. Hoteliers and investors were seeing dollars signs. The city is building more hotels with congress facilities than anywhere else. The largest hotel in Europe with 2,500 beds is due to be completed in 2005. International chains such as Raffles, Marriott, Ritz-Carlton and Radisson are all investing in new hotels in the city.

Berlin currently offers 63,000 hotel beds, 25,000 of them in high- class categories. It has 12 five-star hotels, more than any other German city. By the year 2004 there will be a total of 80,000 hotel beds to be filled. Yet holiday and congress accommodation is more expensive here than many other European hotels at an average 103 euros (95 U.S. dollars) per night.

In spite of the slump, tourism leader Nerger denies there is a crisis. He is optimistic that business will pick up again by the second half of 2002, and predicts a modest single figure percent increase in visitors.

Berlin is still the top trade fair location in Germany and can still expect a steady flow of visitors because it is the seat of government.

Nerger considers it an opportunity rather than a disadvantage for the city that travel is becoming generally more expensive. "Good value room prices in Berlin mean that operators will not have to pass on higher prices to the customer," he said. This might make a visit to Berlin a bargain compared to other European cities.

But the number of foreign guests is not likely to rise in 2002 because of the economic situation and the after-effects of the U.S. terror attacks, Nerger believes. He said this will make domestic tourism all the more important to Berlin  -     dpa jbr mb ct

    


AFGHANISTAN SET TO BECOME TRENDY NEW TOURISM DESTINATION

Afghanistan will in a few months become a trendy new tourism destination for intrepid travellers, predicts Afghan Tourism Minister Abdul Rahman.

"The country is now open to tourism for the first time in 23 years," Rahman told AFP in an interview. "Many people will be curious to see it first-hand, especially since it has been on television so much lately."

He said he expected a tourist influx from Europe, Muslim countries and the United States "in three or four months".

"They will be genuine tourists, not aid workers or journalists," he said.

US citizens, in particular, would be keen to see places like Tora Bora, where alleged terrorist mastermind Osama bin Laden was holed up in December with his followers, he said.

A heavy bombardment by US warplanes and a ground assault by Afghan forces eventually sent them fleeing towards year's end, apparently into neighbouring Pakistan.

Bin Laden is wanted in the US for the September 11 terrorist attacks on New York and Washington, which killed at least 3,300 people.

The southern city of Kandahar, where Taliban leader Mullah Mohammad Omar -- wanted by the US for given bin Laden shelter -- had lived, will also become a tourist stop, Rahman added.

"Of course right now I wouldn't send tourists to Kandahar or to Tora Bora but in some months the situation will be very different."

The minister has a difficult job on his hands.

Bin Laden and Omar are still both on the run, and US warplanes are continuing their bombing campaigns in some areas of Afghanistan as they attempt to wipe out fanatical supporters of the two Islamic hardliners.

Kandahar is reported by aid agencies to be extremely unstable, while roads linking main centres are populated by ruthless bandits.

Apart from the lack of security, most cities have been badly damaged by more than two decades of fighting linked to the 1979-1989 Soviet invasion of the country, the subsequent civil war and, since 1996, warfare between opposition forces and Omar's now-ousted Taliban regime.

Infrastructure barely exists, all centers suffer frequent power outages and the Afghan version of "luxury hotel" falls far short of international standards.

And then there's the question of landmines -- all 10 million of them scattered across the country.

Rahman, of course, is aware of all these problems but believes nevertheless the authorities can secure some key tourist destinations, such as the capital, Kabul, the breathtaking Panjshir valley just to the north, the ancient western city of Herat, and large tracts of the north.

He's also taking steps to find an international partner to help upgrade Kabul's main hotel, the Intercontinental.

"We will also improve restaurants and the transport system for tourists," he said.

A school to train tourist guides is currently being set up and in a few weeks the first students will start their classes.

Even though many previous tourist sites have been destroyed -- such as the giant Buddha statues in Bamiyan province which were blown up by the hardline Taliban -- they remain a curiosity, he said.

"Bamiyan is beautiful with or without the Buddhas," he said. "Afghanistan offers nature parks, historical sites and wonderful landscapes.

"Of course there are problems, but if peace continues to exist, we will be able to create a very safe environment for tourists."

Travel agents from Egypt, Spain and Greece had already made inquiries about marketing the country, he added.

Once commercial flights resume into and out of the country in a few weeks, foreigners -- led by traders -- would start arriving in droves, he predicted.

"After that word of mouth will ensure that Afghanistan becomes the new place in the world to visit."

The current saturation television coverage of the US bombing campaign and the hunt for Bin Laden and Mullah Omar might not be a deterrent, he said.

"It may be negative publicity right now, but at least it is publicity. For more than 20 years we were totally ignored by the world."

-         Agence France Presse

HSMAI TRAVEL INDUSTRY AWARDS WILL INCLUDE HOTEL PROPERTY SELECTED AS E-MARKETER OF THE YEAR

CHICAGO (January 2, 2002) - TravelCLICK has developed a new award category and debuts the E-Marketer of the Year Award in conjunction with the Hotel Sales & Marketing Association International's (HSMAI) Annual Travel Industry Awards program. The premiere award will be presented at the HSMAI Gala Awards Dinner on January 29, 2002.

The winning hotel property will be selected on the basis of their e-marketing effectiveness as judged by analysis of TravelCLICK's exclusive Hotelligence database, the industry's information source on the $15 billion electronic marketplace of hotel bookings made via the GDS and the Internet.  In addition, booking performance from the individual property's Web sites will be analyzed to select a winner. The nominees for the award include hotels from around the globe.

"The winning hotel will be recognized as a leading-edge adopter of e-marketing practices," said Bruce W. Mainzer, senior vice president of marketing for TravelCLICK in announcing this new award. "Thousands of hotels are proactively using electronic marketing to increase revenues and profitability, so it is only natural that this award category has been established."

The E-Marketer of the Year will be announced at the January 29th Annual HSMAI Travel Industry Awards Night Dinner at the New York Marriott Marquis honoring the winners of HSMAI's 45th Adrian Advertising awards, 15th Golden Bell Public Relations awards, and 2nd Golden Click Web International Awards. HSMAI will also present the 2001 Albert E. Koehl Award, established in 1975 to recognize individuals who have made significant contributions to advertising and marketing in the hospitality industry, and the 2001 Winthrop W. Grice Award, established in 1989 to recognize individuals who have made significant contributions to public relations in the hospitality industry.

This year's HSMAI Travel Industry Awards contest attracted more than 1,500 entries from 46 countries and destinations around the world, with entries judged by teams of experts from all sectors of the industry. Those attending the awards dinner are a virtual "who's who" of the hospitality, travel and tourism industry.