service level agreement | WhaleTales Blog by Chris von Ulmenstein

Loved it or hated it, Cape Town Routes Unlimited tried its best to gain exposure for the tourism industry of the Western Cape province, even though it led to duplication with Cape Town Tourism in marketing Cape Town. Seven years after the Western Cape Tourism Act of 2004 was promulgated to establish a destination marketing organisation, later branded as Cape Town Routes Unlimited, it closed its doors yesterday. A new era starts, with its remaining staff and Board transferring across to Wesgro as of today – no, this is not an April Fools’ Day joke!

In a statement sent to the industry on Friday by Western Cape Minister of Finance, Economic Development and Tourism Alan Winde, he announced that ‘incorporating trade, investment and tourism marketing under one roof would bring greater efficiency in these strained economic times. It would also ensure coordination of the Western Cape Government’s outward facing marketing initiatives‘. From today, Wesgro is the ‘single economic development delivery agency of the Western Cape Government, and its official implementation agency’, said the Minister. He added that financial and human resources would be combined to drive ‘a far more aggressive international marketing campaign with a unified brand focused on business and tourism‘. Combined market research will also be beneficial to both parties, in providing information about the world economy, he added. While the industry knew about the amalgamation commencing today, it was not told that Peter Bacon, Chairman of Cape Town Routes Unlimited, had left Cape Town for Mauritius. We picked this up in the media conference during a tea break at the Cultural Tourism Conference earlier this week, which was jointly hosted by Cape Town Routes Unlimited and the Western Cape Economic Development and Tourism department. Another shock was reading the Minister’s announcement that Cape Town Routes Unlimited CEO Calvyn Gilfellan has left the organisation, not allowing one to say farewell to him at the Conference.

One could be concerned about the continuation of tourism marketing within Wesgro, given a new Chairman of the Cape Town Routes Unlimited Board (Deon Cloete from ACSA) until the organisation is wound down through the Western Cape Tourism Act being repealed, the departure of the CEO who also was the marketing driver for the organisation, and the departure of all the Marketing executives in the past year, leaving mainly administrative Cape Town Routes Unlimited staff moving to Wesgro. The Minister stated that a Service Level Agreement has been signed between the Cape Town Routes Unlimited Board and Wesgro, for the delivery of the tourism marketing organisation’s functions. The staff will remain in its current offices in the Waldorf Building, completing the compilation of the Annual Report, and staff receiving the same benefits as they did at Cape Town Routes Unlimited.

The Minister’s concluding paragraph is a subtle admission that all was not well with the marketing of the Western Cape by Cape Town Routes Unlimited: “I would like to assure all stakeholders and partners in the tourism industry that we are committed to ensuring even better tourism destination marketing programmes and support. Tourism accounts for 10% of this province’s GDP, making it very serious business. This move will allow us to give this industry the attention it deserves”.

In his last newsletter sent to the tourism industry on Friday, Mr Gilfellan nostalgically looked to the past as well as forward, and said goodbye without announcing his departure from the organisation. He joined Cape Town Routes Unlimited in 2004, handling Visitor and Membership Services, when Noki Dube was the organisation’s first CEO. After Sheryl Ozinsky was the CEO for a short stint, Mr Gilfellan was appointed as the CEO in 2008. He praised the work of his team in having created ‘a healthy, growing, universally recognised, admired tourism destination marketing organisation… in prime condition’, few in the industry agreeing with this over-exaggeration, and clearly Minister Winde also did not agree, in making such a radical organisational change. Mr Gilfellan wrote with sadness how the Cape Town Routes Unlimited budget reduced from R60 million at its inception to R 25 million in the past year, due to the withdrawal of the 50% funding of the organisation by the City of Cape Town, monies (R42 million in the current financial year) which were allocated to Cape Town Tourism, which led to duplication of activities in marketing Cape Town specifically, but also the rest of the Western Cape. He wrote that they found ‘strength, guts and determination to continue delivering work of the highest quality’, despite the financial impediment.

There were many aspects of Cape Town Routes Unlimited which we criticised over the past seven years, but it seemed as if the organisation had finally found its niche in the past twelve months, in its commendable industry communication via media releases, which we received almost daily (compared to the infrequent ones from Cape Town Tourism, which Tweets rather than taxing itself with the preparation of releases), and its marketing activities in Angola, Brazil and Argentina, and in China and India. The biggest criticism of the organisation was the development of a double brand name at its inception, which goes against the grain of all marketing wisdom, being ‘Cape Town & Western Cape’. The duplication of marketing action lies between Cape Town Tourism and Cape Town Routes Unlimited, and the Minister has not shared with the industry how this duplication will be addressed, other than by closing down Cape Town Routes Unlimited. One wonders what synergies there really are between Cape Town Routes Unlimited and Wesgro, with the latter body focusing on marketing our province as an investment and trade destination. We request the Minister to give the industry far more information as to the ‘route’ ahead in marketing the Western Cape, which is not dealt with in any depth in his letter to the industry.

It will take months for the two bodies to find each other, for the Western Cape Tourism Act of 2004 to be repealed, and for the marketing synergies to be developed, meaning that the marketing of Cape Town and the Western Cape will grind to a halt over the critical winter months, characterised by seasonality, and a time during which marketing is most needed, given the tourism crisis experienced last year.

POSTSCRIPT 4/4: In a harsh letter to Southern African Tourism Update, former co-head of marketing at Cape Town Routes Unlimited and now Director of Sales and Marketing for the Durban International Conference Centre, David Frandsen, said that ‘Wesgro is taking tourism into the wrong direction’. He called for an autonomous convention bureau for Cape Town, which he describes as being ‘emasculated’ now, given the closure of Cape Town Routes Unlimited. Even more sharp is his attack against who must be assumed is Western Cape Tourism Minister Alan Winde: ‘It would seem that every decision taken by the politicians seems to retard the proper functioning of tourism marketing in the province, particularly with regard to business tourism. So much potential is bedevilled by those who do not understand how the business tourism industry works!’

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

The tourism industry in Hermanus is delighted that the stormy reign of tourism on the Cape Whale Coast has finally come to an end, with the Mayor of the Overstrand Municipality, Mrs Nicolette Botha-Guthrie, cancelling the Service Level Agreement between her municipality and the Cape Whale Coast Destination Marketing Organisation (DMO) two days ago.

The demise of the DMO brings to an end the controversial attempts by the Lerm family to control tourism in Hermanus and the Overstrand area, and to benefit from it for their own businesses. Clinton Lerm was the Chairman of the DMO and of the Hermanus Tourism Bureau, and stepped down to become Vice Chairman of the Hermanus Tourism Bureau when allegations of conflict of interest were first raised. His mother Maxie Lerm also served on the executive of both tourism bodies, and many tourism-related meetings were held at the Lerm’s Misty Waves Hotel, felt by many to be inappropriate. Many fingers were pointed at Clinton Lerm’s management, or lack of, of the DMO, and the politicking that took place. In the end it was the DMO’s attempt to make a Tourism Bureau of the DMO, in competition with the Hermanus Tourism Bureau, that was the beginning of the end of the DMO. Lerm promised to call a Special General Meeting, at which he would consolidate the membership of the DMO and the Hermanus Tourism Bureau, but after a year he had not managed to call such a meeting.

The Lerm family have had a nightmare week, both mother and son having been members of the Hermanus Tourism Bureau committee that resigned, to prevent being voted out in a ‘No Confidence’ motion at the Special General Meeting called by its members last Monday. Now both Lerms have lost their powerful DMO positions, especially given that Maxie Lerm was handling PR and publicity for the DMO, allowing the family the advantage of media contacts for their own business interests, it is alleged! Maxie Lerm is now a DA member of the Overstrand Municipality, and fortunately has not been given the Tourism portfolio, given that the family has overplayed its hand in dominating all tourism bodies in the region.

Ironically, Clinton Lerm a month ago called an Annual General Meeting of the DMO for next week, at which he wished to table two constitutional changes:

* a change in the definition of a ‘member’, it being proposed that it become ‘any citizen registered in the voting districts of the Overstrand and/or a tax contributor not in arrears on any municipal services’ – this would have meant that every resident of Hermanus, including occasional users of their holiday homes in the region, would become a voting member of the region’s most powerful tourism body, without necessarily having an interest in tourism! It was never the intention that the DMO have members – Cape Town Routes Unlimited is also a DMO, but does not have any members!

* a confusing ‘additional constitutional point’ concerned voting procedures and rules, the DMO wanting the current constitutional requirement of only allowing members of 60 days or longer standing to vote at the meeting to be overturned, but no resolution was defined for this for the meeting.

The Chairman also announced that the AGM would not include an election, normally an agenda item of an AGM, stating that an election date would be set a month after the AGM, in consultation with the Overstrand municipality. Now the AGM will no longer be held, and instead the DMO ‘as a seperate legal entity (still) has to be wound up’.

In a media release issued by the Overstrand Municipality yesterday, it uses the Municipal Finance Management Act as the reason for disbanding the DMO, in writing that ‘a greater degree of direct control by the Municipality over the distribution and use of the funds allocated, is required’. Interesting is the sentence which politely points a finger at the upheaval caused by Clinton Lerm and his Board in running the DMO: ‘The envisaged new system will facilitate such control whilst at the same time ensuring that there is a greater degree of cohesion and synergy within the whole Municipality as a tourist destination.’

The Municipality also announced that a ‘dedicated tourism officer’ is needed, reporting to its Directorate of Economic Development, and co-ordinating the ‘activities of the various Tourism Bureaux and to establish a single tourism marketing strategy for the whole of the Overstrand.‘ When the DMO was established, its Constitution stated that a Marketing Manager be appointed, but this never happened in the four year existence of the DMO! The Municipality intends to form an ‘advisory committee from the community to advise the Municipality on all tourism related matters’. The committee would consist of Cape Whale Coast tourism bureaux representatives, and tourism players, to allow the ‘voice of all role players and stakeholders will be best heard and effect given to the advice received’. The Municipality intends to implement its new tourism dispensation from 1 September, the start of the summer season in the area, and leading up to the Whale Festival at the end of September.

While it is fantastic news that the Cape Whale Coast DMO is no more, and that a brand new Hermanus Tourism Bureau committee was elected last week, it will take time to appoint the municipal Marketing Manager, at a time when the region desperately needs to attract tourists after a terrible winter and a poor summer lying ahead. One hopes that the municipal Marketing Manager will not be bogged down by municipal red tape, and will be strong enough to focus on doing what is best for the Cape Whale Coast, and not for personal interests – it will make a refreshing change. With the stormy politics now at an end, the Cape Whale Coast can now focus on marketing its wonderful assets!

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