Get ready……

Happy New Year and welcome to 2017!

I’m not one for making resolutions, mostly because I change my mind so much! If you want to change something, better to just to get on with it than wait for some arbitrary date to start. That’s my excuse anyway. Similarly, looking backwards doesn’t help because we can’t change what has past – although as numerous people (apparently) are quoted as saying – if you don’t remember past mistakes, you’re doomed to repeat them!

So, in the interests of progress, let’s look forward.

I’ve read two articles over the end of the year break that I felt were right on point. I’ve attached links to these so you can read them yourself.

The first was by anti-aging & sports medicine pioneer, and futurist, Dr Robert Goldman (http://ow.ly/Akd9307C9Bt). Dr Goldman pointed out some of the changes that society will be subjected to over the next few years. What is most striking is the speed at which these changes will take place. I remember talking to a scientist with British Telcom back in the early ‘90s who said that they knew absolutely what developments would arrive within 5 years; they had a pretty good idea what would happen in the next 10 years but beyond that they were ‘wishing and hoping’! as Dr Goldman suggests we are now in the exponential age, where changes occur at an ever increasing rate. In many cases these changes happen faster than most businesses can adapt. If you read the article you’ll see that many developments will directly affect the Travel and Tourism Industry.

The second piece was by Christopher Elliott in the Washington Post (http://ow.ly/Hrvl307C9Ob). Chris is suggesting that 2017 is the year many people, especially Americans, won’t be traveling on vacation. He cites many reasons and offers suggestions of how as a tourist you can benefit (please go and read it!) but for those of us in the industry there are three main takeaways. That tourist will be looking for alternative accommodations, authenticity and satisfying their needs for instant gratification.

I’ve talked to many travel and tourism professionals over the past year and we’ve discussed the inevitable changes that are happening and I can’t think of anyone who has disagreed. After all, the signs are really clear – very ‘in your face’ as it were. However, many are not willing to accept the speed of changes.

Take ‘alternative accommodation’ – Airbnb in particular. Home sharing has expanded incredibly rapidly. Airbnb are now the largest accommodation provider in the world with over 2.5million homes (incidentally, they own no hotel rooms!) yet most of the vacation rental companies here in Northwest Florida’s Northern Gulf Coast seem to think think they are not a serious threat to their business model.

The past year the 1.5 million guest arrivals to Florida via Airbnb represent 114 percent year-over-year growth. This comes as Floridians increasingly embrace the home sharing platform as an opportunity to earn supplemental income and make ends meet. The Airbnb Florida host community grew 74 percent in 2016 to a total of 32,000 hosts.

Yes, the local industry says, but it’s in cities, not here.
This is the total supplemental income earned by Airbnb hosts in our local counties:

Bay County $4.9 million
Walton County $3.3 million
Okaloosa County $2.9 million
Escambia County $1.8 million
Santa Rosa County $683,000

That’s a total of nearly $13.6 million. True, it’s only 10% of the income from Miami-Dade alone, but its still remarkably significant.

People love the idea of either staying with a local host, or staying in the home of a host which they perceive differently than the relatively anonymous experience of a cookie cutter condo or a ‘standard’ hotel room.

This contributes to the ‘authenticity experience’ that comes from home sharing, boutique hotels and the like.

Chis Elliott also refers to ‘Instant Gratification’. I know I’m always talking about the attitudes of Millennials and younger Boomers but they do have have a seemingly out of proportion effect on our industry. Their behavior appears to affect the other sectors of our audience too. The ubiquity of smartphones and the ability to access information from wherever you are, makes the almost impulse decision to book a vacation all too easy.

You’ve bought things on Amazon. How many times have you been tempted by the ‘people who bought this also bought this’ suggestion?

Think what will happen when someone suggest “How about we go to The Gulf of Mexico next weekend?”. You look at your phone and up pops the local CVB websites – you see what events are happening, and guess what? You can book the Airbnb accommodation right there, and the concert tickets, and the Uber from the airport. Of course there was link to book flights too but you’ll probably want to do that with the airline because you get your miles there – and suddenly Delta Air Lines are offering 1 mile for every $1 you spend with Airbnb if booked through them – oh, and Uber credits too.

We have a change to the whole vacation booking experience, which is not taking 5 or 10 years to develop but is happening as we speak.

Put a note in your calendar to contact me at the end of 2017 and tell me if there have been no changes to your tourism business during the year. To be frank, I don’t think you’d be able to do that by June!

Whatever happens is going to be exciting. The evolution of the world’s biggest industry has always been fascinating and the near future won’t disappoint I’m sure.

Please follow the Owen Organization blog on www.owenorganization.com, sign up for the newsletter and follow us on Facebook at www.facebook.com/OwenOrganization. Lastly, check out the weekly ‘Talking Tourism’ column in the Northwest Florida Daily News every Sunday.Flying to the Gulf

Generational disruption and other buzz words…..

An old joke in the ‘80s and ‘90s was “ I bought a video recorder that was ‘so simple, a 5 year-old could program it’. I ended up having to get my 5 year-old to program it as I couldn’t’.”

That five year old is now likely a Millennial generation adult and is having a major disruptive effect on the whole of the tourism industry.

The Millennial generation now comprises around 25% of the US population according to the US Census Bureau and they travel a great deal. PhoCusWright reports that 71% take at least one trip of three nights or less, 42% travel internationally (compared with 28% of older travelers), and they are twice as likely as older generations to take longer trips of 14 nights or more.

The Millennial generation also travel differently than previous generations in that they don’t always stay in hotels. They stay with friends and they use services like Airbnb. They don’t always use taxis, car services or rental cars – they use Uber and Lyft.

Unlike previous generations, they may take more trips but spend less. They are more connected, with 90% owning a smart phone – compared to 57% of older travelers – which 66% use to shop or buy travel. They use a wide variety of sources for their research and booking from OTAs, review sites like TripAdvisor and of course peer advice shared through a whole raft of social networking.

According to Samantha Worgull of ‘Hotel News Now’ and PhoCusWright, Millennials tend to book at the last minute with 23% booking less than one week before departure.

They seek experiences and want to share those with their peers and families through social networks. Experience is the whole raison d’etre for their traveling. No matter if this foodie, eco-tourism, adventure or pure excitement. The simple fact is that this group want to do more than lie on a beach.

To return to the old joke about video recorders, those same adults who sought advice from their children are now Boomers and are again seeking advice from their Millennial offspring. They want to where and how to buy their travel. They want reassurance that Airbnb or Uber are safe.

Marcello Gasdia, senior analyst of consumer research at PhoCusWright said during a recent conference “Millennials have been the trend setters, they are the ambassadors of technology.”

So, this is the disruptive influence the Millennial generation is having on the whole tourism industry:

They book late
They look for value
They seek experiences
They share their trips with others
They research intensively
They influence older travelers

How does this affect the traditional providers of tourism products?

For airlines and hotels the loyalty of the Millennial traveler cannot be guaranteed. Many fewer are members of loyalty programs, 22% compared with 41% of older travelers. The inference is that they may not trust the advertising and promotion of established companies blindly. They are more likely to take advice from friends and independent reviews, and change their booking habits accordingly.

Travel agents as we knew them are largely a thing of the past, particularly in the USA. In Europe and Canada the situation is slightly different but certainly the old style travel agent is dead. In their continuing quest for value, On-Line Travel Agents (OTAs like Expedia) are well in the mix to seek bargains and value. Anything that is not an ‘experience’ like a conventional hotel room or condo becomes a commodity, to be booked wherever the best deal can be found – preferably at the last moment.

The last minute tourist is still looking for the destination experience, the tour (hopefully not conventional but personally led by a local!) or activity will probably be left until arrival when the weather and local area has been checked out. Tour and activity booking specialist TripShock! confirm that most of their bookings are made after a guest arrives in the destination. Where does the Millennial tourist find the information? Again, peer advice or advice of a local. Local tourist boards (CVBs, Chambers of Commerce and similar organizations) are seemingly trustworthy sources, particularly in areas where the likes of TripAdvisor or Expedia do not have much content (Virtually everywhere except places like Orlando, New York or Las Vegas!).

The problem with local tourist organizations is that on the whole they further refer visitors to individual tour providers for follow up. Given the attention span of website visitors, they want to get advice and book there an then, not have to make lists and do even more research.

Experience from tourist organizations in New Orleans shows that if they offer advice and reviews and then enable on-site, immediate booking it results in more bookings for local businesses, happy tourists and a bonus of commission payments to the tourist board.

Disruption is a current buzz-word, but the Millennial generation has disrupted life in the tourism industry worldwide. Not only by their different travel habits and use of technology; their search for ‘experience’ and value, but also their influence on the other generations of traveler. Particularly the Boomer generation. The important factor with this group is that they have more opportunity to travel and have a higher disposable income. They also learn fast when it comes to technology.

The Boomers also learnt, back in the day, to listen to their offspring……

Not willing to just sit on the beach......
Not willing to just sit on the beach……

A free gift……

I recently celebrated yet another birthday. They appear to come alarmingly more frequent. As a kid I used to count the birthday cards but now count, with amazement, the number of good wishes I receive via social media. The greetings come from the world over as my friends and family get spread further and further.

In the old days of course, one had to make a great effort of keeping a birthday book, buying a card, the correct value in stamps and remembering to put the card in the mail. These days, thanks to technology, we’re reminded automatically and all it requires is to post ‘Happy Birthday’ and to add an emoji or an imaginative sticker, gif or what have you.

That’s not to deride the process as I for one really (no, honestly, REALLY) like to wish my friends the best on their birthdays and appreciate being able to do so easily and across the world. The technology is a huge help to my memory and I love (thank you Mr Zuckerberg) being able to maintain contact with contacts from school, various workplaces as well as family, wherever they may be.

However I digress from what I intended to write.

I also received messages from a number of businesses that want my business. Starbucks for example. I’m a gift card spending , app using, loyalty card carrying Starbucks follower and of course they have my birthdate. So I get the message offering a free coffee. I know that this is an automatic system that just pings off the email, and I know that the free coffee costs virtually nothing. I also recognize that I probably won’t even claim my gift. But it makes me feel good none the less. My ego thinks they really care, even if my marketing brain knows different.

So, tourism people, when that client registered on your website did you collect the birthday information? More to the point, when that traveler made a booking six months out from their travel date did you contact them during those months other than to send them a balance invoice?

Back in the 70s and 80s the travel agency I worked in used to make a calendar entry for all their clients bookings and regularly sent out postcards to the clients saying ‘only two months to your trip’, or ‘are you packing yet?’. We even considered sending postcards from their destination to keep the excitement going. It was a chore, delegated to the office junior, but mighty effective. We also sent out cards after the vacation asking how the trip had been, and later reminding them that as six months had past, they needed another break! The customers loved it and kept coming back.

These days all that information is easy to collect automatically (no need for the office junior!) and scheduling the emails, FB messages etc., requires little or no work. Cheap too – no postcards, stamps, addresses to look up or trips to the mail.

My free birthday gift to all of you in travel and tourism is to make use of your databases. Send out messages reminding people about their forthcoming vacation, thank them for their past trip (no, not the customer satisfaction survey, but a genuine ‘thanks for visiting and we want you back’ message), or even a ‘we’re missing you’ email.

For DMOs, when your collecting likes on Facebook, or addresses in your database, follow up with a message asking if they’ve booked? Send them Holiday Greetings – personalized of course – from The Sunshine State, The Red Fish Coast or wherever you are.

Yes, it’s corny. Yes, the customer knows it’s automatic. But they also, deep inside, appreciate it.

It’s like thanking them for their good review of TripAdvisor. It shows you’re listening and that, behind the technology, you do actually care.

Oh, and in case  missed it – Happy Birthday!Birthday Cards

Plus ça change…….

I read an article recently that prompted me to think about how the purchase of travel, and associated products, has changed over the years. More importantly it made me think about how things have stayed the same.

The article was published by organization Tnooz, which is a global provider of news, analysis, commentary, education, data and business services to the travel, tourism and hospitality industry. A sort of Owen Organization on steroids! It was pointing out how travel marketing has become more frustrating than ever because the cost of acquiring customers in the digital age has become very high. The article can be found here http://ow.ly/swbP304mz1e

Back in the ‘80s and ‘90s I was involved in a company selling long haul travel to people in the United Kingdom. The customers wanted to buy air tickets, accommodation and tours that would allow them to travel to Australia and New Zealand. Naturally this wasn’t an impulse purchase, and certainly in those days, it would be termed ‘a trip of a lifetime’. We found that although the customers would phone our offices and have long, long conversations about their proposed trip, many of them wanted to actually visit us in person. I’m assuming they wanted to make sure that we weren’t going to take their money and disappear into the night! These folks would travel a great distance to see us, often half way across the country. They’d arrive with great folders of information that they had gathered over a period. By the dates of the ads they’d torn out of newspapers, we could tell that they had been collecting info often for some years.

It wasn’t just one or two travelers who behaved like this, it was the majority. I guess that if you’re about to have the ‘trip of a lifetime’ then you would be tempted to take a long time in putting it together. The trouble was, that this was’t in general, a one off trip.These customers were ‘frequent fliers’ with us, although frequent meant once every two or five years.

That didn’t mean that they only travel to our destinations, but went on other excursions in the intervening periods, and presumably they put as much research into those trips as they did with the flights ‘down-under’.

That process all happened in the pre-internet days, when research meant reading magazines and newspaper articles. It required the tearing out and keeping of numerous ads from the travel sections of the national press. Watching every travel documentary they could find was almost compulsory. These customers knew more about ‘our’ destinations than we did.

The internet and the World Wide Web changed all that of course. Instant access to information, price comparison sites, peer reviews and OTAs – on line travel agents, have consigned all that to the dim and distant past. Or has it?

More recently I’ve worked with travel companies and destination marketing organizations who have been grappling with how to best spend their money to acquire customers. A great deal of thought has gone into when and where to place ads. Given the ability to track responses to digital ads and to measure the open rates of newsletters it’s understandable that those in charge of the budgets want to know, definitively, what is working and what isn’t. This is all well and good if we assume that all travel decisions are made on the fly and travelers do the same thing year after year.

Making those assumptions – impulse buys and repeating past decisions – encourages the marketeer to place trackable ads and then cease making ad buys that don’t result in immediate bookings, or at least bookings that can’t be linked to a particular campaign. However we must look at the the way people actually book.

A customer sees a print ad in a glossy magazine that prompts their interest. They ‘file’ that away in their memory either consciously or more likely unconsciously. They don’t remember the phone number in the ad, or the ‘trackable’ URL. While driving they hear a radio ad about the same destination. To be honest it’s unlikely they will stop and write down the phone number or URL and so, that’s just another memory. By some miracle the potential traveler either sees something on-line or maybe even searches for info on their iPad or phone. They may bookmark the info for later or perhaps even respond to the ad for more information. Enter the dreaded cookie that tracks their every on-line move, and suddenly every on-line ad they see is about that particular destination, hotel, airline or cruise. Magic! The DMO, or advertiser now knows everything about them and sends out teasers and newsletters. The success of those original print ads and radio spots is called into question. They did not, as far as the digital marketeer knows, result in a booking so it makes sense to stop that particular channel spend.

Our potential traveler now responds to the email they have received. They may forward the email to a fellow traveler or they may just click on a link. More likely, they’ll just remember the general email rather than the full link to the page they viewed. They’ll then go another device – the work based PC, or a phone or other screen to get more info. Of course there’s no cookie following that move, and they may even be using different email address for each inquiry.

Although as marketeers we may rewarded with the trackable booking, it’s more than likely that the ‘thread’ of the booking is lost numerous times.

Another distraction is the length of time it takes to make a decision. I can’t remember the number of times we’ve seen a destination on a movie or in a magazine and said we must go there – this year’s out of the question because we already have plans but next year’s a possibility or the year after…..

Down here on the coast of the Gulf of Mexico we had the tragedy of the Deepwater Horizon oil spill in 2010. The resultant exposure that region the received was the silver lining in that particular cloud. BP were forced to spend millions in the following years. CVBs along the coast worked together to promote the area but more importantly the media (bless ’em!) flooded the airwaves with images of our pristine sugar white sand and emerald green waters. Whatever their apocalyptic message was at the time, the names of Destin, Panama City Beach, 30A, and Pensacola became embedded in the psyche of people who had never heard of us before. Since then, tourism numbers to the Gulf Coast have continued to rise aided by the activities of CVBs (often in spite of the efforts of CVBs!). The area has even attracted groups of visitors who would never have thought of coming previously and now remember that the Gulf is a place to go, even if if they can’t remember what lead them to that thought.

So, have things changed? Maybe. The ability to track the source of bookings is there but definitive answers to what works is absent in the vast majority of cases. Although tourists make last moment buying decisions, those are usually based on ‘bucket lists’ formed over a long time.

To go back to original thought, that it’s becoming more difficult to know where to spend your marketing dollars, yes it probably is. There are many more channels, more opportunities and higher costs. However, people behave in much the same way as they always have.

The more things change, the more they stay the same.

Twickenham Travel's corporate travel department in the late 1970s. Not a computer in sight!
Twickenham Travel’s corporate travel department in the late 1970s. Not a computer in sight!

Can you tell me the way…..

A tourist was driving through the beautiful Irish countryside and obviously lost. He he saw a local sitting by the side of the road and stopped to ask directions. ‘Excuse me’ said the tourist. ‘Can you give me directions of how to get to Dublin?’. The local considered for a while, and said ‘Well, I wouldn’t start from here’.

That probably is exactly the situation many destination marketing organizations (DMOs) find themselves in today.

In the USA and probably many other countries, DMOs grew out of the the local chamber of commerce – the result of concerned local businesses wanting to grow tourist visitation. Eventually, they decided that the skills needed were beyond the chamber and local government were persuaded to take over the role and formed a Convention and Visitor’s Bureau or local tourist board. To fund this they either committed an element of their budget derived from local taxation, or they collected a tourist or bed tax from visitors. Either way, the DMO is now normally administered by a group of interested and knowledgable local citizens, and ultimately controlled by local politicians – City Councilors, County Commissioners or a whole host of other titles, depending on where you’re located.

In an ideal world, you’d set up this organization before any tourists arrived, and before any infrastructure had been built. Your group of advisors and Councilors would all have significant knowledge of tourism, marketing, commercial and environmental issues – and common sense (the least common element in the Universe!) Then you could influence decisions like ‘no buildings to exceed the height of a palm tree’, ‘visitors must not leave items on the beach overnight’, ‘create sufficient car parking to anticipate demand in 20 years’ – you know the sort of thing.

But it’s not an ideal world.

For a start the infrastructure wasn’t planned. Like Topsy it just ‘grewed’. No one really planned much further ahead than next season. The one big hotel in town became the dominant commercial interest and was then bought out by a Chain.

In the ski resort, the lift system was already 30 years old.

To cap it all, the city elected representatives are all retired hydraulic engineers (I have nothing but admiration for hydraulic engineers, the occupation just randomly flew into my mind!) or lawyers. No knowledge of tourism, commercial imperatives, associated technology or marketing, no matter what their other undoubted qualifications may be.

Add to this toxic mix the speed of change in travel technology, emergence of social media, the rise of peer reviews, changing tourist demographics and worldwide political changes and you have, to over cliché this particular pudding, a perfect storm.

In our part of the world (Northwest Florida) this has been highlighted by a couple of recent events.
One is the emergence of Airbnb which has put a strain on how and if Tourist Development Tax (Bed Tax for want of a better name) is collected. This article (http://ow.ly/7QMp302ESAv) demonstrates how Santa Rosa and Escambia Counties are trying to cope. It’s almost as if the Airbnb concept has suddenly appeared. Uber has had the same effect on taxi regulation around the world.
The other issue revolved around the running of a country music event in Okaloosa County. The idea was suggested that the county should run the event as a trial to provide business for the local convention center. If nothing else, they would break-even and learn lessons for future events.

The lessons learned were that the county were hamstrung by their (possibly understandable) complex and long winded purchasing and contract writing system; that having to refer everything to two committees including the Board of County Commissioners slowed the whole system to a snails pace; and that really they should leave such things to people who knew what they were doing.

Oh, and they made a staggering loss on the event.

The latter example resulted in the sensible decision that in future, such events should be outsourced to the private sector. A good lesson learned and kudos to the people involved for acknowledging this.

So, how do we move forward?

Speed and agility are the watchwords for tourism today. DMOs must be able to turn on a dime (or sixpence, depending on your location) to react to changes, developments and opportunities.

The nature of government is that it’s unlikely (though not impossible) to have the knowledge, awareness and nimbleness to recognize and react in a timely manner.

A local government agency that I know has taken a year to create a new website, and it hasn’t been implemented yet. They’re in tourism and have lost a whole season, possibly two. At the same time a private company has created a state of the art website, with different versions for smartphones and tablets; included video, web cams and on-line booking; acquired partners; and all in two months from pulling the trigger. The site will go live on schedule and on budget.

True, some private companies are as slow as government (An accommodation provider has taken 4 years to change a website and no mobile version. Hello?), and not all local government is unresponsive. But you get my point.

The suggestion is that government run DMOs should at least partner with private companies if not outsource the whole business. Visit Florida is a great example of a public/private partnership, although some politicians do want to be more involved which is a questionable move.

It’s a conversation well worth having between the politicos and private enterprise. Locals need to get involved too.

We probably shouldn’t have started the journey here, but that’s the where we are. We just need to get our directions, decide on our route and follow it – fast.Well.......

I’m not a Grockle*, I live here!

I live in a tourist town. It’s a great feeling actually living somewhere that people save up their cash and time to visit on vacation. Well most of the time! I do sympathize with other locals who find their lives disrupted during ‘the season’ by what they perceive as traffic gridlock, full restaurants, and sometimes inflated prices, but I have a slightly different view, brought on by my lifetime obsession with tourism and the fact that my income is directly dependent on it.

Growing up, I lived near London and just ten miles from Windsor Castle and a host of other tourist centers. At one time it was common for residents to wear button badges saying ‘I’m not a tourist – I live here’. I must confess that when you’re trying to get to a business appointment, or just grabbing a lunchtime sandwich and you’re held up by a bunch of visitors with no perception of time, personal space or local customs it can get a mite, shall we say, irritating!

Having it pointed out to me that if it wasn’t for the tourists, I probably wouldn’t have a job, or the local amenities I enjoyed, didn’t initially help, but gradually I got the message and came to be tolerant and then respect (I think love may be going too far!) the visitors.

So, living in a tourist area has its challenges but what can those of us in the industry do to convince our fellow residents, who may have no immediate connection to tourism, that it’s a good thing to be in a place that others want to visit?

Destination Marketing Organizations have a duty to promote their areas to tourists. It’s their whole raison d’etre, but it’s my feeling that education of the locals is also a duty. DMOs do need to firstly let their residents know how they are promoting, what they’re promoting and importantly, why. Many residents think that visitors know an area exists and therefore promotion isn’t needed. It’s a fair point, but obviously incorrect to those of us involved.

It’s pretty pointless running ads in local media if you’re trying to attract visitors into a market, but you should at least share the ads you’re running out of market so that your locals know and understand what’s happening.

It’s also no bad thing to tell your locals why tourism is so important. Here in Florida there is no state income tax. That’s because 24% of sales tax is paid by tourists, so for locals that’s a very good thing and something of which they should be aware and not forget. It also matters that for someone who doesn’t think they work in tourism, that they see how their income is invariably linked to the success of local tourism, however indirectly. Nobody but the DMO is in a position to share that information.

A wise hospitality professional once referred to a line of visitors cars clogging a road as ‘every one being a credit card on wheels’

Lastly, there’s room to involve the locals in helping tourists. Who but a resident knows the best restaurants, or best attractions? Who else would know the history of a place, or indeed where to avoid!

Perhaps the DMO should issue button badges that say ‘I’m a local – ask me’!

*’Grockle’ is an informal and often slightly derogatory term for a tourist. It was first popularized because of its use by the characters in the film The System (1964), which is set in the Devon resort of Torquay during the summer season. Some older dictionaries suggested that it might be an English West Country dialect word.