Tag Archives: Bureau of Economic Research

Tourism industry enjoys good 1st quarter 2013!

Both the Bureau of Economic Research and the Tourism Business Council of South Africa (TBCSA) FNB Tourism Business Index reflect that the first three months of this year showed an improvement in the confidence level for the South African tourism industry. While Cape restaurants would agree, the confidence may not have been shared by the Cape accommodation industry, who still cannot see a significant improvement in their occupancy levels, and dread the early arrival of the winter season.

The Bureau of Market Research released its results for the first quarter of this year last week, and showed a 7% growth in the volume of Accommodation business, with a very positive expectation of an 11% growth rate in the second quarter – this contrasted strongly with the 16% decline reported for the last quarter of 2012. Since 2009 the Bureau had measured declining volumes of Accommodation business, the first sign of a turn around being measured in the first and third quarters of 2012, but with declines in the second and fourth quarters of the same year, demonstrating how variable the growth is and how susceptible it is to global recessionary influences.  Business confidence in the Accommodation sector increased to 52 (an index measured out of 100) in the first quarter of this year, a significant increase from 38 the quarter before. In contrast, the real estate and business services industries showed minimal business confidence growth in the same period.

The TBCSA FNB Tourism Index was introduced in 2010, and is based on a study of tourism confidence conducted quarterly by Grant Thornton. The Index is measured and compared against a score of 100 reflecting ‘normality’.  For the third consecutive reading the Tourism Business Index has exceeded the score of 100, a positive step given that most of the scores since 2010 lay below the 100 mark.  The latest index measurement is 111, just below that measured at the time our country hosted the World Cup, the highest score ever achieved, before the scores slid.  Respondents are asked to quantify their expectations for the quarter ahead, and the actual first quarter confidence score far exceeded the anticipated score of 102,5.

Grant Thornton’s Gillian Saunders said that the survey results were split, with 30% reporting strong demand and another 30% reporting it as weak. ‘Playing in different geographic markets may impact this; for instance in 2012, Asian markets saw a huge growth in tourist arrivals and businesses targeting those markets have no doubt benefited’. One hopes that Mrs Saunders is not referring to the SA Tourism statistics for China, which appear to include transit passengers!  More likely could be a geographical difference, in that Gauteng and Durban may have been more positive in the past quarter due to the AFCON Cup of Nations which took place in Johannesburg and Durban in January – February, while Cape Town missed out as a host city for the soccer event due to the City of Cape Town’s mismanagement of the bid process, and therefore Cape Town’s tourism industry may not have been as confident as a result!  Durban has hosted a number of top conferences and events, including a meeting of the BRICS country presidents, and an Indian tour operator conference.  Saunders emphasised that there is still concern about the impact of the recessionary problems of Europe.  While tourism confidence may have improved, the TBCSA CEO Mmatšatši Ramawela stated that the petrol price, cost of sales, electricity prices, municipal tariffs, and labour issues negated the confidence levels of tourism players.

Grant Thornton, the company that got the estimate of the World Cup 2010 attendance so badly wrong, is to conduct a three year study of the Cape Town tourism industry, to measure the value of its tourism industry. A 2009 survey had put a value of R17,3 billion on our City’s tourism industry, a 6% increase on the 2008 value of R16,3 billion.  The study results will become a benchmark to measure the economic value of Cape Town’s tourism industry, said Mayoral Committee member for Tourism, Events and Marketing Grant Pascoe. The study will use national data (read highly criticised) SA Tourism statistics and tourism surveys to measure the spend by tourists whilst in the city. Tourism businesses will be interviewed, to establish their turnover and employment figures.  One can be sceptical about the co-operation that the researchers will receive from the hospitality industry in extracting turnover figures!   Councillor Pascoe said that collecting the tourism industry information could be used to assess the infrastructure requirements for Cape Town, and could be used to motivate infrastructure upgrades to benefit the tourism industry!  One wonders how many millions the Grant Thornton Cape Town tourism study will cost, and how reliable its results will be, given the sensitive information sought!

Chris von Ulmenstein, Whale Cottage Portfolio:  www.whalecottage.com Twitter: WhaleCottage

Cape Town Tourism and Cape Town Routes Unlimited in PR war, signal divided tourism city in crisis!

If it weren’t about such a serious topic, one would be amused by Cape Town Tourism and Cape Town Routes Unlimited, two bodies ludicrously tasked with the marketing of Cape Town, fighting a PR war, with media releases coming from them in rapid succession, even on weekend evenings!

Historically Cape Town Routes Unlimited was given the mandate to market Cape Town and the Western Cape as a tourism and business destination, but the marketing funds for Cape Town were withdrawn by the City of Cape Town by its then Tourism Councillor Simon Grindrod, due to the unsatisfactory marketing performance by Cape Town Routes Unlimited.  The City’s R15 million was then allocated to Cape Town Tourism, which body originally only had the mandate to run Visitor Information Services in Cape Town and in Somerset West.   Cape Town Routes Unlimited did not stop marketing Cape Town, and now we see both bodies market Cape Town, and appearing to compete against each other for column centimetres in the local newspapers.  Strangely, Cape Town Tourism did not issue a media release about the volcano ash cloud disrupting air traffic on Saturday, as Cape Town Routes Unlimited, with the provincial Tourism Minister Alan Winde, had sent a media release that same evening, unheard of for a public body to be so proactive in providing news.  However, The Finalist status of Cape Town for World Design Capital 2014 has not been acknowledged by Cape Town Routes Unlimited, as Cape Town Tourism was involved in the bid preparation, and announced the news via its media releases and member newsflash on Tuesday.

Cape Town Tourism had not reacted to the tourism industry’s perilous current state.  While it did write that the city’s tourism industry would only pick up by 2014, it focused more on brand Cape Town, and how it needs to be re-positioned, Cape Town Tourism having been responsible for its current (unknown) positioning in the first place, having led the marketing of the city for three years already.   Last week we criticised Cape Town Tourism’s  lack of reaction to the tourism crisis in our city, to which no response was received from its CEO Mariette du Toit-Helmbold.  Yesterday the Cape Times  screamed in its headline: “City’s tourism sector in crisis”, having picked up Cape Town Tourism’s 2014 recovery release, and linking it to the Bureau of Economic Research findings of the worst ever accommodation confidence level of 25%, which we referred to as well, which the journalist mistakenly called ‘occupancy levels’ (occupancy of 25 % would have been most welcome now!).  Incidentally, the article also stated that the City of Cape Town was meeting yesterday to decide whether a grant of an astounding R40 million will go to Cape Town Tourism to market the city.  No outcome of this meeting decision has been made public. We have been vocal about our dissatisfaction with the apparent lack of visible marketing of Cape Town, other than the CEO and PR Manager’s Twitter presence.

Cape Town Tourism reacted to the Cape Times  with a media release today, trying to downplay the severity of the situation and denying the ‘crisis’ in the tourism industry, and incorrectly deducing that it is seasonality that is to blame.  It refers to the good publicity that Cape Town has received recently (which has not brought any enquiries at all), and that the FIFA World Cup was never meant to be a quick fix for the marketing of the city.  It blames ‘out-of-date’ marketing of the city, for which Cape Town Tourism is to blame!  The media release demonstrates how out of touch the organisation is, in that it is the forward bookings that are not coming in at all, for many accommodation establishments, up to 50 % of their bookings having come from the UK in the past, and this enquiry level will not be repeated this summer.  Interestingly, the release uses the ‘silo’ terminology of Marthinus van Schalkwyk, Minister of Tourism, which he used in a speech at FEDHASA Cape last week, but in a different context!  Here is a section of the Cape Town Tourism Media release:

“Cape Town Tourism cautions against alarmist statements about a tourism crisis. “We are in the middle of winter, traditionally a very tough time for the tourism sector in Cape Town.  This is reflected in the low occupancy levels currently experienced by the majority of the industry. The increased supply, decreased demand and lingering recession add to the challenges the tourism sector faces,” says Cape Town Tourism CEO, Mariëtte du-Toit Helmbold. There are signs of recovery, albeit at a slow rate of 3-4%, which will mean that recovery could take significantly longer than initially anticipated unless we change tactics.”

“We cannot ignore the real danger the tourism sector faces by reverting to tried, tested and out-dated marketing methods and continuously operating in silo’s as tourism, business, investment and government. Neither should we stop investing in our traditional markets, which we depend on for the lion’s share of our visitors and revenue, to focus all our attention on growing domestic and business tourism. Tourism remains one of the biggest business sectors and employers for our region. It needs continued investment and a more balanced approach that will see tourism working together with business, investment and other sectors under the powerful and consolidated brand positioning of inspiration and within a single minded economic strategy for our region.  The World Cup taught us much about communicating better with visitors, alternative source markets and about focusing on the customer when developing our brand and marketing messages. Cape Town has a long way to go before the majority of our citizens can call it a great place to live, but the World Cup was a good launch pad for the future. We are a better, brighter, more world-friendly city than before and we have to credit the World Cup with this legacy. Let us build upon this platform created.”

Cape Town Routes Unlimited jumped the gun on Cape Town Tourism last week, in its media release which urged hoteliers to slash their rates, but also demonstrated that the organisation’s CEO, Calvyn Gilfillan, is also not in touch with the industry, in knowing that most accommodation establishments reduce their winter rates by up to 50 %!

We would urge Cape Town Tourism, Cape Town Routes Unlimited, Alan Winde, the provincial Minister of Tourism, and Grant Pascoe, the City of Cape Town’s new Councillor responsible for Tourism, to meet, to find a solution out of the tourism crisis, and to sing off the same song-sheet!

POSTSCRIPT 23/6: The Cape Argus  today reports that Cape Town Tourism’s grant of R40 million was approved yesterday, and that Cape Town Tourism will use the monies to stage off-peak season events as well as a ‘technological campaign to target potential tourists’.   The sad reality is that the Marketing Plan was written before Cape Town Tourism realised that the tourism industry is in crisis – one hopes that they have the flexibility to adapt their plan to cater for the poor summer season lying ahead!  “Cape Town Tourism is committed to playing a leadership role in ensuring that our tourism industry embraces technology.  We will continue to invest significantly in this area, building upon the solid foundation laid in the run-up to the World Cup, and keeping up with global trends, with the focus on mobile and smart phone travel applications for Cape Town”, Cape Town Tourism’s CEO is quoted as saying.  This is hardly the solution to the crisis in the tourism industry in Cape Town!

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com  Twitter:@WhaleCottage

Open letter to Minister of Tourism Marthinus van Schalkwyk

Dear Minister

We have been very happy to have you as our Minister of Tourism, especially when your portfolio became a dedicated one. Since May, however, I sense that our tourism authorities in cities, SA Tourism, and your department are seeing the development of a crisis in our tourism industry, but that nothing is being done about it.   I remember a song Jeremy Taylor once sang about the Ministers that ‘minis’ – I feel that you and your department are ‘minis-ing’, not playing open book with us, and that you are deserting us in our time of need.   Here is why:

1.  You appointed tourism consultancy Grant Thornton, who created fantastic forecasts of how many tourists would come to South Africa for the World Cup.  The recession hit the world in 2008, and at no stage did Grant Thornton revise its forecast for the event attendance.  On the basis of their projections, Cape Town alone saw the addition of 9 new hotels and 1500 beds, not to talk about the numbers of apartments that were hastily vacated and renovated, for letting purposes.  We all painted and polished our guest houses, yet the soccer fans that came to stay were just like all our other tourists in the end.  Home and flat owners, taken by Seeff’s campaign with Gary Bailey as a spokesperson, sat with empty accommodation when they cancelled leases with their existing tenants to make a quick buck.

2.  You allowed us to be ripped off by MATCH, a FIFA affiliate hospitality company, who milked us with unheard-of commissions of 30%, with your blessing!  And then they cancelled the largest part of the booked stock, on their own favourable cancellation terms, just eight weeks or less prior to 11 June 2010. 

3.  You sent the Mickey Mouse team from Disney  to quickly spruce up our service excellence, at a cost to taxpayers of R9 million or so, a waste of time for all that attended.  Our nation is one known for Ubuntu, and we were recognised for it as one of our success factors – we did not need Disney to teach us that!

4.  But it is the current post-World Cup crisis, which Cape Town Tourism confidently tells us a year down the line was predictable, given the 2000 Sydney Olympic Games example, that is getting to all of us.  The Bureau of Economic Research survey results released earlier this week shows us that confidence in the Accommodation sector is at its lowest ever, at 25 % (even estate agents are more confident at 41%, and they are not having a great time!). There has been no growth in confidence since 2007, even though we knew that the World Cup was coming in 2010.

As the most senior official driving tourism in our country, we would have expected that you would guide and lead us, that you would tell us what drastic steps your department and SA Tourism are taking to help us to get international tourists to our country, and local ones to our cities and provinces.  All we hear from you is how successful South Africa has been, and how the World Cup has contributed to this success. For the first time you have acknowledged that things are not going so well, and that “growth in the tourism sector is expected to slow down towards the end of 2011“, reports Eye Witness News about your address to FEDHASA Cape earlier this week.  You are reported to have said at that same meeting that ‘visitor number (sic) still look good following the country’s successful hosting of the soccer showpiece.  The minister replied by stating some establishments invested too much in catering for an influx of tourists prior to the tournament”!  Sir, with respect, it was your consultants that guided us on visitor numbers.  Now the proverbial has hit the fan, and there will be none of us left in this industry if you are saying that it will get even worse towards the end of this year! 

5.  I feel for you, being reliant on those on the ground to feed back to you how bad things really are, and that you are misinformed and misled by some.  I cringed when I read that FEDHASA Cape Chairman Dirk Elzinga put the poor booking situation down to the usual Cape winter seasonality, demonstrating that he is not a hotelier, and does not have a clue about the hospitality industry, having headed up the Cape Town International Convention Centre previously.   I was depressed by Cape Town Tourism’s long-winded acknowledgement that something mustbe done about changing how Cape Town is marketed, as if we have months and years to do so.  Cape Town Routes Unlimited has been the most proactive in talking to our industry via the media, in asking us to slash our rates, but clearly they do not know that we charge rates of up to 50 % less in winter, and have done so for the past 15 years or more.  Many ofus have not increased our summer rates since 2007, yet costs are rising continuously.

6.   Your own consultants Grant Thornton are saying that not enough local and international marketing is being done, especially in the newly opened markets of China, India, Brazil, Mexico and Argentina.  I like that you have addressed the ‘silo’ mentality of the tourism industry, as reported in the Cape Argus, and even see this at our local level.  Cape Town Tourism and Cape Town Routes Unlimited are operating independently, and without apparent collaboration.  High airfares are one of the reasons for the poor tourism performance – please help us to get SAA to price flights realistically, so that we can get the tourists to our country.  Help us to get direct flights to Cape Town, instead of via Johannesburg.  It is interesting that you identified that the power of tourism is in the hands of a small number of powerful operators. Share the tourism pie with all of us.  Please open the doors, and create dialogue between the different sectors that feed and sustain the tourism industry. I was shocked to hear that the Board of Directors of Cape Town Routes Unlimited is now hand-picked by provincial Minister of Tourism Alan Winde- what happened to getting privatesector input, via nominated Board candidates?  All we are getting is the same perpetuation of provincial-friendly players and their thinking, and most Board members that were newly elected in April are unknown to us! 

We are receiving no guidance from your Department, SA Tourism and our local tourism authorities about how we keep our businesses afloat, and how we prevent a bloodbath of restaurant, hotel and guest house closures in the next few months, which has already started.  It does not help to hear that your CEO of SA Tourism, Ms Thandiwe January-McLean, has just resigned, and will leave at the end of August, in a time that we need SA Tourism desperately. 

Sir, we need your help.  Help us with negotiating extensions of bond repayments at the banks; help us by not allowing the Reserve Bank to increase interest rates; help us with better tax breaks; help us by getting electricity increases suspended; help us with loan facilities to help us survive and to continue to offer employment to our staff; help us with an urgent campaign to encourage locals to travel – it has been talked about but we are not seeing its impact; help us by pushing PR internationally, to not allow South Africa, and the Cape in particular, to lose visibility when New Zealand hosts the Rugby World Cup in September and October; and lastly, be honest with us – do not give us false hope by telling us how fantastic our industry is right now.  We are bleeding Sir, and we need your help!

POSTSCRIPT 16/6:  Business Report today quotes the Minister as saying: “Although tourism had continued to grow since the World Cup ended last July, the industry was slowing down worldwide.”  He is also quoted as saying that international tourism growth to South Africa will continue but that we must “be more competitive than our opposition”.   He added: “Our prices and products must remain competitive, and unnecessary cost drivers must be identified.”  He would not be issuing price guidelines, and he confirmed that the traditional source markets remain Europe, the UK and the USA, due to their longer holiday period, but recognises the longer-term value of the Asian market.  He urged that visa applications for tourists be made easier, and even become electronic.   The Minister’s Department of Tourism is to set up a conventions bureau, to spread the business ‘beyond the three main cities’, and he indicated that benefits could flow from the expiry this year of the current system of granting air traffic rights to fly into South Africa. 

POSTSCRIPT 17/6: Southern African Tourism Update  reports that the Minister is to have also said at the FEDHASA Cape AGM that local tourism authorities should not market internationally, as SA Tourism is doing so already, and that they should focus on local marketing instead.  He quoted the example of KZN Tourism, which has a marketing office in Gauteng.  Was he addressing Cape Town Tourism and Cape Town Routes Unlimited? 

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com Twitter:@WhaleCottage

Cape Town tourism recovery only in 2014, says Cape Town Tourism!

It was depressing to read the article”The Business Case for Tourism and a strong brand for Cape Town” by Cape Town Tourism CEO Mariette du Toit-Helmbold, and published on the Cape Town Tourism Blog.  Oddly it has not been sent to its members.  The most disturbing prediction it contains is that the R14 billion Cape Town tourism industry, which employs just short of 300000 staff, will only recover in 2014, in getting back to the 2007 level, the last good year for tourism in Cape Town.  What is disappointing is that Mrs Helmbold does not provide any guidelines to her Cape Town Tourism members as to how businesses should survive the next three years of poor business, nor does she spell out what she and her organisation are doing to market Cape Town more visibly!

To set the scene, Mrs Helmbold writes that international arrivals to Cape Town as well as domestic arrivals have stagnated due to the ‘Global Financial Crisis’, as she calls it, and she estimates a total loss of R 1,5 billion for the Cape Town tourism industry between 2008 – 2014, with zero job creation as a result.  Unlike other provinces, Cape Town and the Western Cape has little Africa-business, with more than 80 % of its business coming from Europe (including the UK, one assumes) and the USA.  Cape Town is a small fish in a massive global tourism pond, with our city’s market share being 0,2 % of world tourism.  She blames SA Tourism by implication for doing too much marketing of wildlife, and too little of the cities in our country :”…many national campaigns are of a tactical nature, which do not necessarily build knowledge and esteem values of our cities”.  The marketing of Cape Town, which is the responsibility of Cape Town Tourism, does “not allow for Cape Town to be compellingly and relevantly portrayed to potential visitors”.  This sounds odd, as Mrs Helmbold is pointing at her own organisation, but she does not explain what constraints there are to marketing the city. She also states that Cape Town’s attributes of being “iconic, complex and multi-faceted” are not evident to tourists.

The rest of the five page document becomes a long and theoretical ramble about how Cape Town should be positioned and at whom it should be aimed: in summary, the marketing of Cape Town no longer should be focused on leisure tourism alone, by highlighting the beauty of Cape Town, but it should incorporate business, investment, academia, and the creative sectors too. All of this appears to have been written to justify to its funders, the City of Cape Town, that unnamed ‘partnerships’ (probably the writers of the document, given its theoretical nature and unusual style for Mrs Helmbold’s writing) are “waiting in the wings for public sector endorsement of Cape Town Tourism’s new 2011/2012 marketing strategy and for the brand execution plan”. 

Sydney is used as an example, in how the 2000 Olympic Games caused a five-year tourism slump to that city, mainly because they stopped marketing themselves, thinking that they had world exposure.  The key learning points for Cape Town Tourism are that cities do not market themselves, they need to be marketed; investment in infrastructure and hosting events create growth and ‘livability’, but may not be relevant to tourists: “lack of marketing induces invisibility and irrelevance, which in itself reduces demand”.

The conclusion of the article seems far too obvious, and one must question why Cape Town Tourism, custodians of brand Cape Town, have not been able to identify the poor tourism and resultant poor industry performance trends, and have not acted proactively to address these problems.  Mrs Helmbold concludes: “If we do not act decisively now our industry and the economic well being of our city and people are at great risk.  If we don’t proactively engage in a new marketing and branding strategy we run the risk of being positioned nonetheless by our competitors, our critics and the media, and most likely to our disadvantage”. The last sentence does not make sense in its wording, nor can one understand why Cape Town Tourism has not changed its marketing strategy to date, having been responsible for the city’s marketing for the past three years already.

As we have pointed out on this Blog, the recent TripAdvisor accolade of Cape Town being ranked in first place as its Travellers’ Choice Top Destination, has seen no tourism benefit at all, and this is echoed by Ms Helmbold: “Although we are considered as one of the new cities to watch for 2020 and continue to rake in travel accolades, it is no guarantee for success or economic growth”.

One must question whether Cape Town Tourism is capable of driving such an important campaign, influencing the revenue of almost all the city’s businesses, all directly or indirectly influenced by tourism, and of its population, dependent on jobs.  Cape Town Tourism’s Marketing Manager until recently was Lianne Burton, a journalist, and not a marketer.  Her departure from the organisation has been kept low-key.  Ms Burton has not been replaced to date.  Mrs Helmbold and her PR Manager Skye Grove are very active on Twitter, but this is rarely about tourism, and far more about their social life. We must question why their time during working hours is not focused on their work and the marketing challenges of our city !  A further concern is the information that we have received that the highly respected PR company that Cape Town Tourism had appointed in Germany, KPRN, no longer does the PR for Cape Town.  There appears to be no visible benefit to tourism in Cape Town of the appointment by Cape Town Tourism of PR agencies in Holland, Germany and the UK.

We wrote to Mrs Helmbold, and asked her some questionsaboutthemarketing of Cape Town.  The first question related to the replacement of Ms Burton.  It appears that Ms Burton left some time ago, but is assisting Cape Town Tourism in a “consultative role” until the end of this month.  A new Executive Manager: Marketing should start on 1 July, she wrote.  Of concern is that Cape Town Tourism also does not appear to have an eMarketing Manager, with a job advertisement posted on Careers24 yesterday, and requiring the person to start on 1 July, not giving anyone time to work out their notice!   We asked about the international PR companies that had been appointed, but Mrs Helmbold was only detailed in respect of the non-renewal of the contract with Kleber Public Relations Network, which has worked with SA Tourism for years.  The company has been replaced by Akomasa Creative Connection in Germany.  Mrs Helmbold did not provide information about the success of the PR campaigns overseas, other than to say that information about it has been presented at workshops, which not all Cape Town Tourism members can attend.  One hopes that Cape Town Tourism can justify its international spend by sending members a detailed report of their international activities to obtain exposure for Cape Town. 

In reply to our question:”What is Cape Town Tourism doing to prevent a bloodbath of restaurant, hotel and other accommodation closures due to poor forward bookings?”, Mrs Helmbold was generalist and vague, and she does not appear to understand that a solution must be found NOW, and not in months to come! This was her disappointing response:

“As I explained in the Paper done on the Business Case for Tourism, the global financial crisis and the subsequent consumer behavioural change has had a significant adverse effect on the tourism industry; demand has diminished, visitor spends have steadied and costs have increased. Our over-reliance on traditional source markets, worse hit by the GFC, places us at further risk. There is not a quick-fix for this problem and no one could anticipate the extend (sic) of the impact of the GFC, of which we are really only now experiencing the magnitude of the impact. This is of course exaggerated by seasonality and as I said before our over-reliance on international leisure visitors from mainly Europe and the US.  

Investing in a strong, multi-dimensional brand is critical. We are pursuing private partners for a few significant brand platforms like international TV productions (BBC, National Geographic), events and campaigns, focusing on our unique strengths as a destination i.e. food and wine. We are focusing our efforts and resources on the “dream” and “conversion” part of the customer journey – assuming that the choice to come to Cape Town is not an obvious one and expensive to get here. We have to reinforce the awareness created during the World Cup, but move to conversion with good value for money offers. From an eMarketing perspective we are adding bookabilitytoourweb-platforms by July this year, starting with accommodation and then introducing it for tours and activities as soon as the new module is built. Through the new marketing alliance with Joburg and Durban we should be able to leverage some of SAT’s marketing spend, this will be a key focus for us in the next 4 months.

Whilst we continue our investment and reinforce our presence in traditional international leisure markets, we are investing in domestic tourism, using mainly some key events as draw-cards and working with the business sector to start changing negative perceptions around our business brand. Both the domestic and business markets are complex issues and will take a long-term approach to turn the tide against seasonality.

We are hosting a series of product workshops within the next few months on value, price, packaging and marketing alignment aimed to assist the industry to become more competitive and mitigate some of the risks faced within these tough economic times.

We will all have to work very hard together, under a powerful and united destination brand, to change the current trends and grow tourism into a more sustainable, year-round industry with a more healthy balance between international leisure, business and domestic tourism.

We are making a few significant changes to our marketing strategy and as soon as the plan is finalised and partners confirmed we will share it with the industry.”

We call for a heavyweight Marketing professional to be appointed, to drive Cape Town Tourism’s marketing of Cape Town. Ms Helmboldhasbeen running “Brand Cape Town” workshops for the past three years, and she is still asking workshops what Cape Town stands for.  Surely by now she and her team should have decided on a unique positioning for Cape Town that would be universally applicable in communication with all the sectors it wishes to attract to Cape Town.  Ms Helmbold’s article sounds like a city marketing organisation that is overwhelmed by the problems its tourism industry is facing, and that does not know the way forward – a very scary situation indeed!

POSTSCRIPT 10/6:  The only response from Cape Town Tourism is this sarcastic Tweet from its PR Manager Skye Grove:  @MariettedTHons le, sit, loop, rol rond op twitter.. tsk tsk.. mar (sic) ek belowe ek sal more bietjie werk.. @SoniaCabano1

POSTSCRIPT 10/6:  Yesterday Cape Town Routes Unlimited CEO Calvyn Gilfellan was reported on Eye Witness News to have urged ‘hotels and industry suppliers to reduce their rates to make travel more affordable for locals’.  He said “I think the industry must really wake up and make themselves more affordable if they want to remain competitive in a very cut-throat industry”. 

POSTSCRIPT 12/6: A business tourism event with a difference was the hosting of the global Playboy editors’ conference, which took place at the Mount Nelson Hotel earlier this week, reports the Weekend Argus .  The group of fifty met for three days.

POSTSCRIPT 13/6: The Bureau of Economic Research sent its results for the confidence in the Services industry today.  Of the service sectors surveyed, Accommodation has by far the lowest Business Confidence Index at only 25% (the next lowest is Real Estate at 41%).  Accommodation bookings are expected to decrease by 56% in the second quarter of 2011, relative to 2010, which was out of the ordinary for bookings due to the World Cup.  For the third quarter of this year, bookings are expected to be down by 23 %.  Trend information supplied showed that the last period of growth for the Accommodation industry was the fourth quarter of 2007.

POSTSCRIPT 13/6:  The provincial Minister of Tourism, Alan Winde, has announced that his plans to consolidate a number of marketing agencies for Western Cape businesses into an Economic Development Agency are back on track, and the Agency is expected to be launched in November, reports the Cape Argus today.  Perhaps this is the agency that can do the business marketing of Cape Town.  However, Cape Town Tourism is no longer on the Minister’s list of agencies which he wants to consolidate, his plans to do so originally causing a huge outcry.  The agencies to be consolidated include Wesgro, Cape Town Routes Unlimited, the Cape Craft and Design Institute, the Cape Film Commission, Calling the Cape, the Cape Town Boatbuilding and Technology Initiative, the Cape Music Industry Commission, the Cape Town Fashion Council, and ten others.    

POSTSCRIPT 14/6:  One company that is benefiting from the tourism slump is the Protea Hospitality Group, which is leasing and buying hotels that have ‘over-extended themselves and are now struggling to survive due to the current slump in the local hotel industry’, reports Southern African Tourism Update.  Protea’s CEO Arthur Gillis predicts that ‘many of South Africa’s 80 hotel brands will disappear’.  Gillissaid that he doubted whether there will be a tourism boom ‘unless it gets more bums on airline seats’. He suggests that SAA should fly routes in the interest of tourism, whether profitable or not.

POSTSCRIPT 14/6: Gillian Saunders of tourism consultancy Grant Thornton said about the tourism industry recently: “It’s really tough out there”.  She blamed this on the recession, the strong Rand, increased costs such as electricity and labour, and an oversupply of accommodation, reported the Cape Times.  City Lodge Hotels CEO Clifford Ross said: “It’s probably the worst I have known for 32 years”.  He added that no one “expected the drop-off after the World Cup to be so severe. There will be casualties in the market. Quite a few (hotels) are teetering on the brink”. 

POSTSCRIPT 17/6: Southern African Tourism Update  reports that the Minister is to have also said at the FEDHASA Cape AGM that local tourism authorities should not market internationally, as SA Tourism is doing so already, and that they should focus on local marketing instead.  He quoted the example of KZN Tourism, which has a marketing office in Gauteng.  Was he addressing Cape Town Tourism and Cape Town Routes Unlimited? 

Chris von Ulmenstein, Whale Cottage Portfolio: www.whalecottage.com  Twitter: @WhaleCottage