What is the general perception of our Chinese visitor? It is a group package visitor who stays in New Zealand 3 nights and predominantly visits Auckland and Rotorua. How could they possibly appreciate New Zealand in only 3 days you might ask? Well the reality is, New Zealand is not their holiday destination, only their stopover on the way back to China after visiting Australia. It’s similar to kiwis going to Europe and saying they have been to France when they only stayed in Paris for 3 nights. Hopefully, that ‘taste’ is enough to encourage them back again, and often it is.

The above mentioned visitors in the industry are known as the ADS Dual Destination Shopping Tour groups which up until the last few years were 75% of our Chinese visitors. ADS stands for “approved destination status” which is an agreement between the Chinese and New Zealand governments (1999) which lets’ holiday travellers visit a country in a tour group. In recent years NZ Chinese inbound tour operators have been working with Tourism New Zealand and trade to encourage more ‘mono’ (NZ only) destination tours and the percentage of FIT visitors coming to New Zealand on FIT/ADS and non ADS visas, is increasing. This is to the benefit of the industry as they generally stay longer and spend more. At December 2012, this percent had dropped to 65% and with the new PKP (preferred kiwi partnership) programme being initiated by Tourism New Zealand, we look forward to more independent Chinese visitors travelling further to the regions.

The new visitor is likely to well educated, younger and keen to self drive. Operators should be taking steps now to improve the satisfaction levels of these discerning consumers with translations and signage even though they are likely to be able to speak English. They are more interested in “feeling” the product and getting up close to nature and adventure activities. They are experienced travellers having already visited Asia, North America and Europe and big users of technology and social media.

Discussions between the private sector and government agencies demonstrate a common goal of delivering a world class experience to our valued Chinese visitors.  If private sector operators deliver the experience on the ground by learning more about their culture, language and protocols and government assists behind the scenes minimising barriers to travel, then together we are well on the way to exceeding the Chinese visitor travel experience and expectations.

The 2012/2013 season seems to have got off to a better start than expected. During the conference last year operators were ‘pretending’ to be cautiously optimistic. By the December Xmas Symposium the mood had changed to being ‘cautiously’ optimistic  and after a round of visiting operators in Queenstown and Rotorua, I’m pleased to report that for many operators, the season is going better than expected with many ‘optimistic’ that the season is better than last year.

One of the questions I have been asking operators is what is your group versus FIT (free independent traveller) percentage? This is answered quickly as a common breakdown statistic operators have being keeping for years. The next question of “what percentage of your FIT business is pure direct versus FIT business coming from an inbound tour operator?” This question caused some pause with some replies ‘not sure’. The reason I asked this is because, as the nature of how your visitors come to you has changed over the last few years with stronger internet, website and social media intelligence, there has been the perception that inbound tour operators are on their way out.

Not so. The traditional distribution channels have certainly had a shake up with a decline in group business and rise in FIT’s, but what some suppliers don’t realise is that inbound operators have changed their business models to accommodate this. Your FIT statistics should demonstrate those who are vouchred by an inbound operator, those who book online via your own website, those who book locally via the i-site or accommodation referral, and those who come to you via an online travel operator.

The short lead in time was another area of discussion. No real surprise there but considering only a few years ago we were talking about 18-24 months brochuring in advance with inbound tour operators, today’s ‘sales environment is quite instant and often geared by airline prices to New Zealand.

By the way, when discussing group business versus FIT, all operators said they prefer coach loads of visitors arriving at a pre determined time rather than not know how many FIT visitors per day ‘could arrive’. Supplier members strongly encourage our inbound operators to “keep getting the group business”. The western markets are our strongest FIT travellers so we need to perhaps look at new group business potentially coming from Eastern Europe (Russia), the UAE and Brazil in coming years.

Although none of the above are on Tourism New Zealand’s top tiers of marketing spend, be assured that the modern inbound tour operator are always thinking of ‘growth and how to make money”. If all decision across the industry – both private and public sectors (particularly policy) were made on this basis, then our economy would be in a better place.

All the best that the remainder of the season produces a better than expected result.

There has been some talk recently in the media about the 100% Pure New Zealand campaign – not as its effectiveness as a marketing campaign or how can we be 100% Middle Earth when we are at the bottom of the world (or the top depending on your perspective) but should we use a campaign slogan of 100% Pure in regards to our environmental status?

The 100% Pure New Zealand campaign was first delivered to the world in 1999 and I remember with excitement the range of opportunities the 100% Pure destination marketing campaign presented to different operators.

‘100% Pure New Zealand’ tells the story of how our landscape, people and activities combine to deliver a visitor experience that is unique to New Zealand. It is a tourism marketing campaign that has proven very adaptable across all markets and media. The statement is multidimensional – it has been used as 100% pure relaxation, 100% pure welcome, 100% pure adrenalin, 100% pure luxury, 100% pure you, etc. – all connected back to the core premise of 100% Pure New Zealand.

In Tourism New Zealand’s 2012 international visitor survey, our landscapes and natural scenery got an overall rating of 9.5 out of 10 – the highest rating in the survey. 8 out of 10 international visitors say that the environmental practices of the New Zealand tourism industry are better than in other countries – and that overall the New Zealand environment is being managed sustainably.  In fact not only have we won the best destination marketing campaign for the 100% Middle Earth as per the World Travel Awards 2012, TNZ and the 100% campaign have won numerous other awards over the period of 13 years the campaign has been operating.

100% Pure is not an environmental or ‘clean and green’ claim.  Tourism operators in New Zealand are responsible caregivers of the environment and are proud to share with our visitors their commitment to being as sustainable as possible. More than 1,000 New Zealand tourism businesses have met the strict criteria and hold an Enviro Award status and on an international scale this represents one of the largest clusters of recognised sustainable tourism providers. Our partnership with DOC (Department of Conservation) is a great example of working between the private and public sectors both via the concession and the conservation programmes.

While the media and general public are at liberty to make comment re the 100% Pure New Zealand campaign, the literal translation of 100% pure has been taken too literally and the evidence produced less scientific and more of a ‘gestimate’. Can we do better with our sustainability and environmental position? Yes of course but for the media to portray the country as an environmental disaster is potentially more damaging to the future of our tourism export receipts than the high dollar.

While I appreciate there is a spectrum of opinion re the 100% Pure New Zealand campaign, let’s make sure the discussion is around its effectiveness in marketing New Zealand rather than an ad  hoc environmental score card.

Re the value of “the Hobbit” to New Zealand, Lesley endorses the commitment that Air New Zealand and Tourism New Zealand have demonstrated in supporting the films and believes that the Hobbit potentially can be our most valuable marketing promotion for the next decade. The film trailers in cinemas around the world will be complimented with 100% Pure New Zealand advertisements. This combined with the social media phenomena will keep New Zealand in the minds of potential visitors.

Fans are spending up to $20,000 per person to be here and travel the length and breadth of the country. Speaking to as group of six ladies from Portugal, Mexico, Adelaide and Perth, their trip to New Zealand was their ‘bucket list’ tour and while their families thought they were ‘crazy’, they were bringing back their families in the future whether they liked it or not. The repeat future business cannot be under estimated and should the Hobbit continue be part of the global ‘must read’ for young children, then we will be well served.

Is there a place for romance in business?  Absolutely, but with a few differences. Think of romance in a personal setting. Eyes meet across the room, a smile is exchanged and immediately your brain goes into overdrive wondering how you can arrange meeting or connecting without seeming too keen. You wait by the phone, check them out on Facebook and see who their friends are. If you are lucky the other person is doing exactly the same and before you know it, a relationship is formed.

In business the balance between the two parties is slightly different. One party (the seller or supplier) has access to information before the first ‘meet’ takes place so it is to their advantage to learn as much as possible about the other party (the buyer). The first meeting may be pre-organised, such as a trade workshop or consumer show, but often the seller is under-prepared and has higher expectations than the buyer, so could end up disappointed. The buyer is in the position of viewing several potential suppliers to have relationships with, so the seller initially needs to ‘woo’ the buyer. Once the buyer is hooked, both parties need to keep the business relationship working.  Regardless of what product or service you are selling, with all relationships, people are often investing in a ‘person they can trust’ ahead of the product.

Relationships that Tourism Export Council inbound tour operators have had with allied members have traditionally followed the process above. However, in recent years the balance has shifted with the supplier now in a position of selling their product direct via their own website, working with online travel agents (OTA’s) or having last minute FIT walk-ins. The relationship balance between inbound operator and supplier is more equal and both parties need to put the romance back into the relationship if they are to have a successful future.

The Tourism Export Council key networking events of the year are fantastic opportunities for these relationships to be kept alive and new ones forged. Having association memberships involves both sides of the relationship to keep working. The full advantages of being a member of the Tourism Export Council cannot be realised unless you participate in surveys, give feedback, ask questions and attend industry forums. Yes, sometimes this means further investment to sustain the relationship but the benefits are there if you choose to utilise all aspects of your association membership. We hope that it will certainly generate new business, but you also get to network with kindred industry professionals who are often facing the same challenges as yourself. And as if securing new business and learning from colleagues isn’t enough, you sustain lifelong professional friendships which in a country this size is very important.

So business and romance go hand in hand. Think about how you can keep the romance alive in your business relationships.

Cheaper from China: by President Martin Horgan

The 30 day Asia rate structure we have today was an initiative I expect New Zealand picked up a couple of decades ago from other destinations frequented by Chinese travellers.

The philosophy in New Zealand behind heavily discounting short lead hotel inventory was to “stimulate and unlock new business” from what was then the new and developing China (and other Asia) markets.  The industry was also turned on by the prospect of last minute ‘top-up’ business that for many busy hotels represented the icing on the cake.

The forecast and outlook for inbound tourism is changing fast and arrival numbers from China are through the roof year on year.  At the same time some of our traditional markets are doing it tough.

This has to mean that we’re selling more rooms to Chinese visitors than ever before, and therefore a higher percentage of rooms are going out the door at Asia/30 day rates – often 30% below traditional wholesale rates.

Is this something the hotel industry is worried about?  As standalone room rates – are these short lead room rates sustainable for hotels?  If not, is there potential for this to be an issue for the greater industry as hotels can no longer afford to upgrade and re-invest, ultimately bringing quality down?

Increasing arrival numbers suggest we’ve been successful in stimulating the Chinese market and there is no doubt we love the late feed that China and other Asia markets offer.  But if we take a step back and look again at why we discount so heavily – is the Asia rate structure still relevant?

China is now the world’s second largest economy and gunning down the US quickly.  Wealth has increased significantly in China and so in 2012, in the middle of the ‘GFC’  (that’s messing up other economies all around the world) it would be very easy to argue that markets such as UK, USA and Europe need a hand up and some encouragement to visit to New Zealand more than China does.

As the balance of the world’s wealth creeps east we’ve seen visitor numbers from China rocket, but I wonder if during that time Asia discounting has simply become habitual for us?  What about when China becomes the world’s largest economy, will we still be discounting to this market?  Should we?  Right now that’s what it looks like.

We all know that China naturally has a late booking pattern.  What we’ve done over the years is create an industry where the market is aggressively driven by a 30 day rate structure, but I’d like to know…  is the bulk of the market  actually stimulated by it?

Does Asia discounting now just play into the hands of this market?  Would we do it again today?  Are we inadvertently supporting shopping tour operators who want cheap destinations to lure shoppers to rRather than positioning New Zealand as a desirable quality destination?

At what stage and under what circumstances should New Zealand consider weaning China off the 30 day rate card? It’s worth thinking about I reckon.

It was suggested recently that our industry was fragmented.  This isn’t the dairy industry with a uniform product and sell price. Tourism represents a few thousand operators, none of which offer the same product.  We’re all competing in the same market place and quite often for the same business – each trying to make a dollar.  While there is a degree of diversification or fragmentation in our industry, it doesn’t mean that we are broken – we’re not, and this is a message that we need to send to the policy makers and parliamentarians.

During a period of difficult trading, the Tourism Export Council membership has grown.  This is a strong indicator that the industry and our members recognise the value in solidarity and that as individual operators, we need to look at the bigger picture. We can learn from working with each other successfully and can certainly achieve more collectively that we can as individuals.  If we were truly a fragmented industry, representative organisations such as the Tourism Export Council would be dead in the water – and I’m glad to say, we’re not.

The NZ Herald quoted an industry leader recently as saying “the industry had to accept it had done a done a poor job of promoting New Zealand and needed to do something about that”.  This is tough talk and although we can always do more collectively, our marketing has been smart and for the most part cohesive.  Tourism New Zealand have lead this and have increased presence off-shore, are engaging in multiple channels and actively pursuing new market opportunities in Asia. Coordinated successful famil programs have continued to support our highest yielding markets and have led the New Zealand trade off-shore to participate in various trade and kiwilink road shows.  As operators, we back this up with our own marketing dollars and activities that take our members to all corners of the globe.  Promoting first, destination New Zealand and secondly our own products.

But there is still room for improvement.  The industry and ‘all its partners’ need to be sure we’re kicking goals for the same team and have the same objectives.  The wider industry needs more opportunity to communicate internally to understand and agree what the immediate and long term objectives, opportunities and risks are for New Zealand tourism. Then we can agree how best to manage that information.

I look forward to catching up with you all at Conference 2012 on the West Coast.

Martin Horgan – President

Two of New Zealand’s top operators have been recognised as the best in the business by their industry peers at an awards dinner held at Shantytown on the West Coast.

Pacific Destinationz was named as the Inbound Tour Operator of the Year, while the Scenic Hotel Group received the Operator of the Year Award, at the annual Tourism Export Council awards night. Inbound tour operators nominate allied supplier members and allied members nominate inbound tour operators. The groups are judged on their innovation, marketing, business operation, communications, accessibility and industry relationships. The Board then assesses those nominated based on a points system to choose three finalists and it goes back out to the respective member groups to vote for the winners.  

Pacific Destinationz– “Inbound Tour Operator of the Year” 2012

Pacific Destinationz Limited is a wholly New Zealand owned company operating as a wholesale inbound tour company in New Zealand and Fiji. Relationships and partnership with New Zealand accommodation, transport and sightseeing providers is critical to any successful operation. Pacific Destinationz has always highly valued these relationships and fully realise that without their support they would be unable to achieve standards of excellence.  Pacific Destinationz offers a full range of product to all markets but has tended to concentrate in developing markets such as Southern Europe and South America. With a stable committed team with multiple language skills, the company fully realise this award is true recognition of the outstanding work of the “PD family”. As a finalist for the past three consecutive years, the Management and staff are truly honoured and humble in accepting the award.

Scenic Hotel Group– “Tour Operator of the Year” 2012

Scenic Hotel Group is the largest New Zealand owned and operated hotel chain. Formerly Scenic Circle, the Group rebranded in 2009 and consists of the Qualmark 3-star Heartland Hotels, 4-star Scenic Hotels and the 5-star Te Waonui Forest Retreat.  Multi-million dollar annual investments in refurbishment, renovation and expansion, and a dedication to the best New Zealand suppliers and products keeps the Group at the forefront of domestic and international tourism. Family values driven by the entrepreneurial and philanthropic Hagaman family underpin the highest levels of service and commitment to the best in tourism and hospitality. The Scenic Hotel group and team are ‘delighted’ to be recognised by their industry peers and business partners in accepting this award.

The decision was announced at Thursday night’s theme night at Monteiths Brewery on the West Coast following the 2012 Tourism Export Council Conference.  Chief Executive, Lesley Immink says the conferences traditionally alternate between the North and South Islands.

“We are delighted to be staging the 2013 conference in the Wairarapa winning by three votes over Hamilton-Waikato. The 190 delegates at this year’s conference greeted the announcement with much enthusiasm so we know we’re going to get plenty of support,”   she says.

Destination WairarapaChief Executive David Hancock says the Wairarapa team who put in a joint bid to host the conference are rapt. These included representatives from the Copthorne Hotel & Resort Solway Park, Tranzit and Tui Brewery whose presentation showed a fun and personable side to the Wairarapa and highlighted the great time delegates will have at the conference.

“This is fantastic.  It will bring the top New Zealand inbound holiday destination decision makers to the Wairarapa and give us and every tour operator in the region a real vehicle to promote the region,” he says. “When the West Coast last hosted this conference at Franz Josef in the early 1990s the region saw a big rise in awareness and visitor numbers surged – we expect to see those benefits in the Wairarapa.”

Mr Hancock says being awarded the conference was the culmination of years of hard work by the regional tourism organisation of working closely with inbound operators and educating them about the region.

“We can’t underestimate how much value this conference means to us. It is an exciting opportunity to showcase the Wairarapa and over the coming months we will be calling on other tourism operators in the region to be involved.”

Mrs Immink says that getting tourism operators to different parts of the country is a key part in educating them on the attractions and activities on offer.

“The Wairarapa has a growing reputation as a visitor destination and we know that Destination Wairarapa will do a great job in ensuring that delegates from around New Zealand and overseas will see it at its very best.”

The dates for the August 2013 conference will be announced in the next few weeks.

Building on that held by the Bus and Coach Association (NZ), this new concession will allow TECNZ members to  accompany clients beyond parking areas and into public conservation areas as they tour around New Zealand. Revenue gathered through this concession will go toward DOC’s recreation and conservation work around the country.

The concession came into effect on April 1 2012 and, while primarily aimed at coach tour groups, can be used by TECNZ member-operated minivans and chauffeured vehicles if they meet the other criteria. Members wishing to spend more than an hour at any one site are still required to apply for a concession in the usual way.

This concession brings TECNZ into line with other tourism concessionaires who currently visit public conservation areas as part of their itineraries in terms of fees and group sizes. The first year will act as a trial process to identify anomalies and allow TECNZ members to cost fees into future itineraries. Being a DOC approved concessionaire in addition to inbound operator members having Qualmark endorsement will add further value to inbound tour operators marketing efforts as a strong point of difference going forward.

Speaking of going forward, registrations are now open for the Tourism Export Council ‘conference event of the year’ hosted on the West Coast 21-24 August. The Tourism West Coast team and Shantytown guaranteed at last year’s conference if chosen, to make this ‘the most memorable conference’ ever. Members voted the West Coast to host, so come and support them by registering for the conference. Part of the experience can begin with the process of getting there. Aside from flights in and out of Hokitika, KiwiRail is offering free TranzAlpine train travel to Greymouth return. Take the extra day and opportunity to join one of the most stunning train trips in the world! The theme for the final night is “kiwiana” so start thinking about your costume now. Come as a famous kiwi, an icon, a music band, politician or a bottle of tuimato sauce… Visit www.tourismexportcouncil.org.nz website to see the latest information and download registration forms.

Once in the red-zone it’s obvious the city’s modern day city planners have a blank canvas to work with.  I for one, hope they take advantage of this remarkable opportunity and think outside the box to create a blended city of historical and modern architecture – a low rise, vibrant city well defined into precincts.   A transport efficient,  sustainable, environmentally friendly city that is not only a positive, easy and fun to live in, but hugely attractive to visitors.

I also truly hope however, the assigned visionaries respect the past, our history and the cornerstones of the city’s famous architecture.  It astounds me that the city’s Anglican Bishop is vigorously pounding the streets demanding that the Christchurch Cathedral be torn down to only 3 metres in height.  The Cathedral is so much more than an Anglican Church; it is undoubtedly the heart of the city.  Christchurch without its Cathedral would be like Sydney without the Opera House, New York without the Statue of Liberty or Paris without the Eiffel Tower.  More than 80% of visitors to Christchurch visit Cathedral Square.  It is our most prized possession and yet its fate may well rest in the hands of the Anglican Church. I know they own it but the Cathedral is more than a place of worship, more than stone & mortar – it’s the heart of the city.

I reckon, if we let the Cathedral tumble, we’ve well and truly given in to Mother Nature and her earthquakes – and that’s not what we’re about.

During WW2, more than 70% of Berlin was flattened – about the same as Christchurch CBD.  Today Berlin rivals Paris as a must visit European destination.  During the cities 70 year rebuild (so far…) it’s obvious the Germans hugely respect their heritage and history.  Modern Berlin is a vibrant mix of the old and ultra-modern. It is amazing, awesome in fact.

We’ve already seen so many remarkable buildings in Christchurch crumble, I’d rather see some of our most prized structures (such as the Cathedral) left in ruins for 10-20-50 years until somebody has the money and inclination to do something positive with them, rather than the wrecking ball.

If tourism is to return to pre-quake levels by 2017 as suggested, we also need to get a serious rattle on.  Key projects need to be defined and work commence.  A Conference centre, a long term events, sporting arena and stadium will encourage new hotels, which in turn will encourage permanent restaurant and shopping precincts.

A USA travel wholesaler who recently visited Christchurch, told me for the meantime at least, she won’t be selling Christchurch to her clients.  She said her recent visit to the city had made her cry, she was sad and went on to tell me that her client’s limited time in New Zealand was too valuable to spend in this compromised city – especially when the South Island and rest of New Zealand has so much to offer.

I’ve got high expectations that the 27 July announcement from the CCDU will give me and my clients, confidence that the city is moving forward, becoming something very special and a must visit destination in any New Zealand itinerary.

Martin Horgan – President Tourism Export Council of New Zealand

Email: info@tourismexportcouncil.org.nz

Auckland is the first regional branch to launch with the hope of other regions getting underway in the next month before the Tourism Export Council conference on the West Coast.Social media will form a major part of the Young TEC communication strategy as most young members of the tourism industry have Facebook and Twitter accounts. Young TEC aims to use this medium to keep its members up to date with regional and national happenings. The official Facebook page can be found at www.facebook.com/youngtourismexportcouncil whilst you can follow updates on Twitter by following @YoungTEC NZ. Photos from the official launch in Queenstown and Auckland Branch launch can be found on the Facebook page. The winner of the SkyWalk vouchers donated by SKYCITY Auckland will also be announced via the Facebook page this Thursday, so if you were at the Auckland launch, go to the Facebook page and like it to be into win.

Based purely on the drive of its membership, Young TEC and its regional branches are keen to hear from anyone keen on becoming part of the organisation. If you would like to get in touch and become a member or offer you services, please contact the regional coordinators at young@tourismexportcouncil.org.nz or checkout the Facebook page for more information. The first annual workshop will be planned to coincide with this year’s Tourism Export Council conference on the West Coast.  ENDS

About Young TEC – Young TEC (Tourism Export Council) is a sub group of the Tourism Export Council of New Zealand, formerly known as ITOC (Inbound Tour Operators Council) of New Zealand. The intent of Young TEC is to create an environment for the future leaders of the tourism industry to network and share their thoughts and ideas with one another. Young TEC is free to join for Tourism Export Council members and can help younger staff further their career in the tourism industry. Membership is available for non Tourism Export Council members but an application fee will apply.

For further information please contact: Dylan Rushbrook – Regional coordinator, Auckland                             dylan.rushbrook@skycity.co.nz 021 505638

Building on that held by the Bus and Coach Association (NZ), this new concession will allow TECNZ members to  accompany clients beyond parking areas and into public conservation areas as they tour around New Zealand. Revenue gathered through this concession will go toward DOC’s recreation and conservation work around the country.

The concession came into effect on April 1 and, while primarily aimed at coach tour groups, can be used by TECNZ member-operated minivans and chauffeured vehicles if they meet the other criteria. Members wishing to spend more than an hour at any one site are still required to apply for a concession in the usual way.

This concession brings TECNZ into line with other tourism concessionaires who currently visit public conservation areas as part of their itineraries in terms of fees and group sizes. The first year will act as a trial process to identify anomalies and allow TECNZ members to cost fees into future itineraries.

TECNZ Chief Executive Lesley Immink says that being a DOC approved concessionaire will add value to inbound tour operators marketing efforts as a strong point of difference going forward. TECNZ members will receive a detailed information pack over the next few weeks outlining process and documentation required.

This year at TRENZ the Tourism Export Council had a trade booth which allows us to maintain an industry presence and network with delegates, but have no appointments with buyers. This in itself is not unusual but because of our recent name change, there were a core of buyers who popped by to say hello. Actually they weren’t popping by to say hello, they were visiting to see if we had a database of all accommodation, attraction and activity suppliers that they could use for ‘research’. When I explained that we were previously called the Inbound Tour Operators Council of New Zealand there were some who recognised what our role in the industry was and others that didn’t have a clue. However, they were keen to sell me the benefits of working with their online travel portal or agency. For those who knew of ITOC, they quickly realised that I was not going to give them access to our database and moved on. For others, it surprised me they did not ask any leading questions about what we do, who we service etc. Instead, they rabbited on about how we can save money by using their portal or service. I asked several, “What do you do to promote New Zealand internationally?” One reply was, “Well, we list the largest range of accommodation providers in the Southern Hemisphere” and another said, “We have the best commissionable listing rates.” I’m not sure if the question was too difficult but these examples demonstrate the value, or lack of, of using an online travel booking service. It appeared there wasn’t a strong knowledge or care factor about your business, more that the purpose was to secure a listing or sale.

A number of Allied Members shared a few horror stories of working with OTA’s and Daily Deal Operators (DDO). The horror may have begun with a disagreement about a rate listed and time frame but finished with poor customer service skills and frustration for the operator. One operator was told to pay up or we will sue you! Although this may be an isolated incident, it could illustrate that while OTA’s and Daily Deal Operators can assist businesses with off loading distressed inventory at the right time and right place, we need to be assured that when dealing with independent visitors, they and suppliers are handled professionally and with respect. The last thing we want is for our visitors expecting a ‘world class experience’ to be negatively affected before they put a foot on the ground.

I also overheard buyers standing in front of me looking at a neighbouring booth wondering why Daily Deal Operators were at an international trade show. Buyers (trade wholesalers) invest a lot of money promoting New Zealand in print and online activities and there is clear merit in their attendance as they make bookings for product suppliers for the upcoming summer season. In contrast, DDO’s help suppliers to sell their product quickly but they don’t invest actively with promoting the country on a long-term advance booking basis. A short-term inventory sale mechanism (like a DDO) versus long-term advance booking channel (buyers) attendance criteria at TRENZ may require more thought in the future.

OTA’s and Daily Deal Operators have a place in the industry but we need to get smarter about how we use them and when we use them. For businesses trying to plan with budgets, staff rostering and purchasing daily produce needed (e.g. hotels, restaurants, cruise vessels etc.), it is very difficult when bookings have a much shorter lead time (7-21 days) in today’s environment, compared to confirmed bookings that come from offshore and inbound tour wholesalers. Booking patterns are changing rapidly and businesses today need to adapt and innovate quickly to ensure they take advantage of opportunities in the market.

Should OTAs and DDOs attend TRENZ alongside product suppliers and offshore/inbound wholesalers? They have different booking patterns, different commission structures and perhaps fundamentally, a different philosophy about the added value they bring to support the growth of the New Zealand visitor industry. Perhaps a survey of sellers and buyers could help with providing this answer.

Experience is a great teacher because you take the test first and learn the lesson after…unknown

Inaugural Young TEC meeting in Queenstown a success!

The first meeting of Young TEC founding members hosted by the Novotel, Queenstown last week during Trenz was hailed as a success by those who attended. Initiated by AOT (NZ) Stephen Marshall and Nelson Tasman Tourism, Loren Heaphy, it was hoped up to 30 pax may attend so they were delighted with the 45-50 who turned up during a very busy week. Chief Executive Lesley Immink began the proceedings with an outline of how the Australian YATEC programme works, followed by an enthusiastic tag team presentation by Stephen and Loren. Designed to be a younger networking forum for tourism industry members age 18-36 years or in the first 5 years of tourism experience, the aim is to progress the organisation further with a professional development programme and matching members with a team of industry mentors.

The evening meeting was to gauge the level of interest and to appoint regional coordinators  who between now and the Tourism Export Council Conference on the West Coast 21-24 August, will host one networking breakfast and an ‘after 5’ function. At Conference, a Young TEC workshop will be set aside to formalise a young TEC committee and goals for 2013. Membership to Young TEC is free if you are a member of the Tourism Export Council, with a fee of $75 incl for non members. More information will be listed on the website and upcoming newsletters. http://www.tourismexportcouncil.org.nz/ytec/

A database of member is currently being developed so register your interest now!

They promote your company off-shore and buy your product on-shore – why wouldn’t you love your relationship with an inbound tour operator? And yet, there are sectors of the industry who fail to recognise that the relationship you have with an inbound tour operator is only about money.

I’d like to remind us one of the core reasons why the distribution channel and working with an inbound tour operator deserves more respect from industry. Yes, tour operators across the industry can receive their customers from a variety of booking mediums and channels. We know, you know it, and the ‘e-get rid of distressed inventory’ agents know it. However an online wholesaler or e-agent, cannot deliver pastoral care, health & safety of customers while they are visiting New Zealand which is fundamental to every customers ‘quality’ experience.

Working with an inbound tour operator does have a commission/referral structure but many forget that you don’t pay the commission until the customer has been delivered to your door. And whether they deliver 10 -50% of your customers, they actually do much more than the obvious. They are for loved ones off-shore, the people they most likely rely on when things go wrong. I’d like to share a story with you that highlight’s the benefit of working with an inbound tour operator.

ATS Pacific, one of our members had 1000 customers in Christchurch during the 22 February 2011 earthquake.  After a few days the member had to report to Red Cross that “51” were missing. Can you imagine the sinking feeling you would have as the owner or CEO of that company in reporting to Red Cross missing people and also having to communicate via thousands of phone calls and enquiries from overseas family members? The staff  and family members of ATS worked tirelessly over the next few weeks with more than 1200 hours of overtime (700 unpaid) – searching high and low, and after two weeks they were able to take everyone reported missing ‘off’ the Red Cross list. What a huge achievement and illustrates the enormous responsibility inbound operators have when people entrust their lives into our care. 

While the earthquake situation was chronic, this is not an isolated or special case – it’s just what we do when we need to do it. Inbound tour operators know what to do and how to find their people on the ground during times like these and that is one of the many benefits booking travel with an inbound tour operator provides. We are constantly faced with a crisis of some description – whether it is road closures, flooding, snow, clients unwell or urgently needing to get home, accidents and earthquakes.

On the new website we have a section on ‘benefits of using an inbound tour operator’.  http://www.tourismexportcouncil.org.nz/distribution-system/reasons-for-using-an-inbound-tour-operator/ . The traditional distribution channel has changed but one thing that remains unchanged is that in case of an emergency,  it is a person that ‘looks’ for another person – not an ‘e-booking service.

Happy autumn to you all and we look forward to having you join us later in the year on the West Coast for the Tourism Export Council Conference 21-24 August 2012. Regards Lesley

I’ve read a bunch of stuff on the project over the last few months and scratched my head each time.  MDL are obviously very serious about this shortcut to Milford, but is it something the industry actually wants? Needs? or would support to the degree they have suggested?  Who’s answered those questions for MDL?

My questions pertain to safety and viability. On the safety issue, I’m not a big fan of earthquakes… and you guessed it, I’d take quite some convincing that a super long Fiordland tunnel is a safe place to be when you hear the earth rolling.

What about an accident? a breakdown? or a fire?  Ensuring adequate systems to cope with emergencies will be expensive to maintain and in a real emergency, walking back out of such a tunnel to safety is a decent and timely haul – which many of our passengers just couldn’t cope with. What systems would be in place to mitigate and deal with this risk?

The estimated cost of the Dart Passage Tunnel has been quoted at around $170 million.  A good deal given the 2km shorter Manapouri Tail Race tunnel cost $212 million in 2002 & a new 1.3km second Homer tunnel (for safety reasons) was recently quoted at between $100 and $160. A NZ Listener article suggests that 60 buses will use the tunnel a day.  Sounds like a lot. A more realistic view could be that total coach traffic to Milford would likely average 55 to 60 peak season, 30 to 35 shoulder & maybe 15 to 20 in winter.  On that basis, about 36 coaches per day on average.

I’m also confused about what vehicles can drive through the tunnel?  Many of the articles I’ve read assume that touring coaches can travel the tunnel for a toll.  However, I’ve also been told that’s not the case and that a coach shuttle connection would operate through the tunnel itself? For our touring groups does this mean another free day in Queenstown for our coach and drivers? Or maybe we’ll need to transfer our groups to and from Glenorchy? Oh god. Imagine the chaos on that Glenorchy Rd if that be the case, coaches up and back to Glenorchy for morning drop off and then up and back for afternoon pickup?

If in fact Milford see’s 36 coaches per day on average throughout the year, consider of that how many coaches would be originating or terminating in Te Ana), how many of these group’s might derive from risk adverse, or worse, markets or sectors that are price adverse, insist on sole vehicle use or just traditionalists who are happy with the current road scenario and see the journey to Milford just as enthralling as the destination.  And what about the existing seat on coach daily operators from Queenstown? Will they use the proposed tunnel?  If not, I can’t see these companies rolling over without a fight.  We’ve also forged strong relationships with these operators over many years working together.

So yeah, I’ve watched this with interest and at this point I still have more questions than answers.  Simple questions like – what would the total Queenstown to Milford and return experience actually look like? what’s the per coach or per person cost likely to be? And based on answers to those questions – will the numbers truly stack up for Milford Dart Ltd? I’d like to know more.

Martin Horgan – President

In regards to the logo, the map of New Zealand remains the constant feature with the colour green representing “pounamu green” and all its variations and striations. The stylised map of New Zealand includes the ‘hook’ and ‘koru’, representing being the provider, the traveller and new beginnings to grow and prosper. The new look website will have further details on the brand change and also outline the process for the Young Tourism Export Council – a voluntary organisation for new ‘younger’ entrants to the industry to develop their own networks and to participate in a mentoring and professional development programme.

The Tourism Export Council also welcomes 01 April 2012 being the start date of our new ‘guiding concession’ agreement with the Department of Conservation. The guiding concession enables inbound operators and tour coach staff access onto the DOC estate with their passengers. This has been a work in progress for several years and inbound operators who do not belong to the Tourism Export Council will be disadvantaged by having to negotiate singularly with DOC and likely to pay significantly higher fees.

Qualmark and the Tourism Export Council have been in discussion re the ‘inbound tour operator’ endorsement category and are pleased to announce to the industry that from 01 April, the category name will change to make the inbound tour operator endorsement exclusive to our members. This gives our members a great marketing advantage when attending offshore trade shows as other inbound operators will not be able to attend and promote themselves as Qualmark inbound tour operators.

While the Tourism Export Council recognises that many operators belong to multiple organisations at considerable cost, the Board has decided that going forward, the Tourism Export Council conference and functions, will be available only to Tourism Export Council members.

I do hope the season is working well for you and all the best for 2012!

For many tourism operators working long haul markets, the high value of the NZD is like a poker hot enema. Over the weekend I watched Bernard Hickey from Interest.co.nz reporting on TV1 where he suggested that Standard & Poor’s mass ratings downgrade of euro zone members is not good news for Kiwi exporters and that the news had already sent the Kiwi dollar soaring against all its major trading partners, heading for an unprecedented 63 cents against the euro.

Predicting Kiwi exporters ‘could be facing a miserable start to 2012’ and commenting that ‘those exporting into Europe will really struggle at those sorts of rates’. He was suggesting also the silver lining was that the price of that German sports car will be tumbling in New Zealand. Ironically however, obtaining one is actually looking less likely for tourism entrepreneurs who rely on European markets. Mr Hickey goes on to remind us though, that less than 10% of our exports go to Euro zone countries. Made me wonder, has Mr Hickey factored Tourism into this calculation? Does that 10% include tourism revenue from the Eurozone? So I called him. And no it didn’t, – based on Export merchandising statistics only.Mr Hickey was a nice bloke to talk to, very interested in my comments, but like many commentators who talk business and export, including tourism in his export commentary clearly wasn’t a natural instinct.

This is the perfect example of why after 40 years (01 March 2012), ITOC is changing it name to ‘Tourism Export Council of New Zealand’.  We’re exporters! Just like any other exporter, the Tourism sector promotes and sell’s New Zealand product off-shore to off-shore buyers, we’re paid from off shore and bring new money into the New Zealand economy.  In fact our marketing message actually promotes indirectly all New Zealand products and exporters.

As major players in that camp, we need to be painted into Mr Hickeys ‘those exporting into Europe will really struggle at those sorts of rates’ picture – because we’ll be hurting too, feeling it now in fact. Depending on who you listen to, over the last few years we’ve duelled it out with the cockies to be New Zealand’s biggest export sector. Right now I understand we’re back in second place – but regardless of our position on the podium, tourism is invaluable to the success of our export driven economy -  and it all starts with recognition.

In 2 years from January 2011, the NZD has grown in strength by 21% against the euro, add to that the cost of oil (crude increased 65% in that time) and flying here, New Zealand is a significantly more expensive proposition for the Europeans than it was 24 months ago – and that’s not good for the Tourism Export community. Stay night figures from Tourism New Zealand, year end at 30 September show 50.7 million visitor stay nights in New Zealand, 6.1 million (12%) from Eurozone and a thumping 14.5 million (28.6%) from EU members.  All that from only 18% of visitor arrivals – yip, nobody disperses throughout New Zealand or stays longer than the EU member visitors.  We love em.

These traditional markets remain critically important to tourism in New Zealand, for many are our bread and butter.  We simply cannot afford to say ‘too hard’ and not invest.  I realise the targets across the orient will be easier to see and hit, but even in what is a very challenging period in wider Europe – we need continued investment, now maybe even more than ever. The rattily pockets housing our marketing dollars are only so deep. I can’t help but think China growth is going to happen even with less expenditure, and maybe some of the money being spent in that market should be targeted back to the long stay, high spending market that is Europe – Eurozone and also non Eurozone Europe.  It won’t be easy – but declining arrivals from Europe will affect every corner of New Zealand.

TNZ continue to support Europe trade shows, have invested further in there UK office and have signalled a trade mission to Eastern Europe for 2012 – that’s all good.  But I reckon, we need more. 

ENDS

For more information, please contact:

Martin Horgan, ITOC President

DDI: 03 358 6886        Mob: 027 6644 836