Tag Archives: tourism industry

Tourism in the Cape: is it up, or is it down?!

Reports about the status of the tourism industry in Cape Town and the Western Cape in the last few days are enough to confuse anyone, as the view on how the industry is doing this summer, two months into the season, appear contradictory, some saying that it is better, and others saying that it is the worst ever!

Reports about a FEDHASA Cape media review held last week contradict each other.  The Cape Argus, using the headline ‘Hotels catch the scent of recovery’, reported that a ‘fair’ season is expected this summer. It stated that the industry had come through a ‘pretty bad year’.   Gotravel24 had a more realistic headline ‘Worst year yet for Cape Town tourism’, quoting FEDHASA Cape Chairman Dirk Elzinga admitting for the first time that the past year has been ‘one of the worst the Cape Town tourism industry has ever seen’.  When we wrote about the tourism crisis in winter, which was subsequently picked up by the Cape Argus, Elzinga did not seem perturbed, and said that Cape Town was just experiencing its annual seasonal dip!

In its review FEDHASA Cape indicated that average revenue per available room decreased by 10% this year, due to the ‘double dip recession’ in Europe as well as the 20% increase in accommodation rooms for the World Cup. The past winter was particularly tough, with four hotels and 10 restaurants that were FEDHASA Cape members closing their doors (many more non-FEDHASA restaurants closed their doors too). Elzinga is hopeful of a recovery, based on average revenue per available room increasing by 5 % in October, relative to the same month a year ago.  Occupancy was estimated to reach 60 – 80 % this summer, Elzinga said, and events such as the J&B Met, the Two Oceans Marathon, and Cape Town International Jazz Festival would attract more local tourists, the type of tourist Elzinga said Cape Town tourism businesses should encourage.  However, Eye Witness News’ report on the FEDHASA Cape  meeting was that ’70-80 percent hotel occupancy (could not be referred) ‘as a standard anymore’.  Elzinga sees positive spin-off from Cape Town being named the World Design Capital 2014, and a provisional New7Wonders of Nature. We have written before that none of the accolades that were heaped upon Cape Town so far this year have led to any significant increase in tourism to Cape Town, probably because tourism from the United Kingdom has all but dried up.

FEDHASA Cape also used the opportunity to share results of a 30-week pricing survey conducted not only for Cape Town hotels, but also for hotels in Barcelona, Melbourne, Vancouver, Boston, Nice, Hong Kong and Munich, chosen to be comparable to Cape Town in that they are not capital cities, and attract convention business.  The survey was instituted due to feedback levelled against the local accommodation industry for its high prices, which FEDHASA Cape wished to dispute.  Predictably it did so, stating that ‘….the Mother City is not out of line with its peers around the world’.  No hard statistics, such as average hotel prices, are provided from the survey. The FEDHASA Cape survey had found that Cape Town’s price and room offering is wider than that of the comparative cities, with the exception of Barcelona.  Five star hotel rates generally are on a par with the comparative international hotels.  Room rates for 4-star hotels were up to 20 % lower than the international hotels, the report states.  We too have checked Cape Town rates at the top-end hotels, and conducted three telephonic surveys, in May, August and November this year, finding a wide range of 5-star hotel rates, and that rates had been lowered in the harsh winter months.

Moneyweb also reported on the hotel pricing survey of FEDHASA Cape, writing that the finding about Cape Town’s hotel prices being on a par with those in other international cities was a ‘surprising result’.  The description about the worst winter is far more explicit, as being ‘one of the most dismal in recent memory”! Elzinga is quoted as saying that Cape Town is ‘not cheaper, but also not more expensive. People think that prices in Africa should be lower than in Munich or Singapore. But luxury costs the same; it doesn’t matter where you are’. An interesting observation by FEDHASA Cape was that those hotels that did not drop rates recovered more quickly than those hotels that cut rates. Our Whale Cottage hotel surveys demonstrated that all hotels decreased rates in winter, contradicting FEDHASA Cape’s observation!  What Elzinga did not appear to consider was that given the lower operational costs of running an accommodation establishment in Cape Town relative to the comparative cities, on labour costs alone, combined with the 20 % increase in accommodation supply since last year, accommodation prices should have decreased, based on the law of supply and demand.  A further negative impact on rates should be the cost of long haul air travel and airport taxes to Cape Town. Therefore there can be no justification for Cape Town’s hotel prices to be the same as those of its international counterparts.

FEDHASA Cape sees a positive impact of direct flights to Cape Town by Air France and Swiss-based Edelweiss, but which could be countered by the cancellation of Malaysian Airlines flights to Cape Town next year.  Elzinga has called for more marketing by Cape Town Tourism and Cape Town Routes Unlimited in India and China, given the problems with the USA and European economies.

At Whale Cottage we have compared Occupancy over the past five years, and we have seen a steady decline over this period, halving over the five year period.  Occupancy at Whale Cottage Camps Bay this month will be the second best this year after the record 88% in February, and an improvement on last November, but is far below the 88 – 96% occupancy experienced in November between 2007 -2009.

FEDHASA Cape only predicts a recovery for the Cape Town accommodation industry in 2013, with occupancy and room rates returning to a ‘normal level’.   The European and USA economies are in such disarray that one wonders how any tourism body can make any prediction about the future of tourism, especially given FEDHASA Cape’s poor interpretation of the industry in winter!  FEDHASA Cape also indicates that bookings are increasingly last-minute, which makes it even more difficult to predict future tourism performance. We urge FEDHASA Cape to be conservative in its estimates, and to not create hopes about the season for the industry, which led to disastrous results when Grant Thornton did the same about the soccer World Cup last year.

The Protea Hospitality Group has seen similar cause for optimism, its Danny Bryer, Director of Sales, Marketing and Revenue, writing a letter to the editor of Southern African Tourism Update that it saw occupancy increase by 3-4% in August and September. Against the background of the unstable USA and European economies, Bryer says that it is hard to make predictions for the hospitality industry, especially with the heavy discounting taking place (contradicting Elzinga too).  Bryer pleads for an end to discounting, even though his hotel group probably is the one to slash rates most severely, quoting day by day rates, and generally is at the bottom end of the rates scale in the comparative hotel rate surveys we have conducted: “Continued discounting devalues every hotel in South Africa, as the battle is fought on price rather than value”. Bryer says the proof of this is that the average daily rate has decreased and the costs are increasing, meaning a declining profit.  This can only be turned around with an increase in rates, he argues.  He deplores that developers, investors and owners added on new rooms, the accommodation oversupply resulting in hotel closures and local companies taking over the management of international hotel groups. Bryer warned against reducing one’s offering to justify a lower price.  Offering value for money is vital.  He also warned that 3, 4 and 5 star hotels are marketing their rooms at similar price points, which he believes to be ‘foolhardy and unnecessary‘.  The Protea Hospitality Group is focusing on offering value-added packages for the domestic market this summer.

Bryer was also quoted in Business Report, saying that their December bookings are up on a year ago, that 5-star guests are travelling again, but that ‘inbound business to South Africa is still quite tight and long haul flights are losing out to short haul’.  The South African Tourism Services Association (SATSA) CEO Michael Tatalias predicts a better ‘holiday’ season than last year, but says that the rates charged will be more realistic than in the past.

Western Cape Provincial Minister of Tourism Alan Winde warned that he will present a ‘bare-bones’ 2012 budget in March, and about ‘emptier’ provincial government coffers and budget cuts, which could impact on its funding of tourism too, reported the Cape Argus last week.  Winde said that the local economy had to be ‘buffered against current shocks in traditional markets’, and urged exporters in the province to find ‘high-growth emerging markets’.  The European growth outlook is poor too, the fourth quarter prediction being one of slipping back into recession, reports Business Report.

What is certain is that it is impossible to predict the summer season until Easter, given the continued economic woes of our tourism source markets, the UK market being sorely missed, and the forecast of Europe slipping back into recession.  Bookings for the summer ahead for Whale Cottage Camps Bay look good until 10 January. Domestic tourism will be the major source market for the medium term, until the global economy recovers.

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

Cape Town Tourism responds to criticism of its Australian “Strategetic” Consultant!

It took Cape Town Tourism two days to formulate a response to our blogpost “So who the ‘bloody hell’ is Cape Town Tourism’s Australian strategy consultant?”. The fact that they have responded to our questions regarding the six-month appointment of Australian ‘strategy consultant’ Ian Macfarlane, and dedicated a detailed reply on their website, and ‘advertised’ it on Twitter, shows that our blogpost has hit a sensitive spot!

The Cape Town Tourism reply (see the full response below) was to point out ‘inaccuracies’ in our blogpost, and to ‘contextualise the reasons for the appointment of Strategetic’, they wrote.  In summary:

*  The Request for Proposal for ‘Strategic Support to Cape Town Tourism for the development and implementation of a Cape Town Marketing and Brand Campaign‘  was announced on its website and on ‘Trade World’ (a digital procurement company, it would appear), and sent to consultants on its database, they write. Three proposals (the two other consultancy names not revealed) were short-listed. The bid by Strategetic Consultants was accepted on the basis of meeting the Request for Proposal the best, they had the ‘most appropriate global destination and brand campaign experience’, and the cost was the most competitive, they write.

*   Ian Macfarlane is knowledgeable about Cape Town, having lived and worked in the city for 18 years, they write.  However, the information about Macfarlane’s studies and appointments do not add up, as there is only a 12 year gap between his completed MBA and Tourism New Zealand starting date.  Also, no Cape Town employers are mentioned for the 1987 – 1998 period, but in our research we found his ‘Bios’ stating that he had worked at Engen (GM of Lubricants Division) and Young & Rubicam Cape Town, neither of these jobs making him an expert about Cape Town, or the tourism marketing of Cape Town.  He has not lived nor worked in Cape Town for 13 years, a vastly different city now!

*    Specific ‘inaccuracies’ in our blogpost are stated as being:

1.  the value of the ‘So where the bloody hell are you?’ campaign, its success (or lack of), and its banning is disputed.  Our information was based on Wikipedia, known to be a reliable source of information, quoting reports by the BBC and Australian media about this particular campaign.  However, should it have contained inaccurate information, reflecting so badly on Ian Macfarlane and Tourism Australia, they would have had the right to request Wikipedia to correct this information – four years or more since the termination of the campaign this has not been done!

2.   The effect of the exchange rate on tourism arrivals, or lack of, is justified through a tourism publication – it goes against the grain of experience of every South African ‘exporter’, which includes our tourism industry!

3.  The www.strategetic.co web address for Ian Macfarlane on his Strategetic Consultants’ business card may be a ‘legitimate address’, as Cape Town Tourism claims, but it does not open to the website of Strategetic Consultants. One wonders why Macfarlane would have such a nonsensical website address on his business card.  It takes one to a page with a heading “Welcome to your new Web Hosting Account”, but requests a password and log-in details!  The consultancy’s web address is www.strategetic.com.au, and one wonders why it is not on the business card correctly!

The last sentence of the last paragraph of the Cape Town Tourism response is a farce: ‘We are more than happy to answer questions to the best of our ability in furthering our commitment to transparency and accountability and we always appreciate constructive input’. It took Mariette Du Toit-Helmbold, CEO of Cape Town Tourism, four days to reply to our five questions, which are contained in our blogpost about Ian Macfarlane.  Subsequent questions relating to the appointment have been ignored, despite three reminders!  Last night, Mrs Helmbold finally responded, writing that she will only respond to our questions on the Cape Town Tourism website, and not by e-mail: “To the extent that your questions raise new issues which require a response on our website, we will update our website for the benefit of all our members and to ensure that facts are accurately presented. We will address any further queries from you in the same way”. The City of Cape Town Mayoral Committee member for Tourism, Grant Pascoe, has not replied to our e-mail, Tweet, and phone call either. The detailed Cape Town Tourism response follows below:

“Clarity on the appointment of International Tourism Consultant

Published: August 25 2011  By: Cape Town Tourism

In response to the Whale Cottage Blog post dated August 23, 2011, entitled “So who the ‘bloody hell’ is Cape Town Tourism’s new Australian strategy consultant?”, Cape Town Tourism would like to point out a number of inaccuracies in the blog post and contextualise the reasons for the appointment of Strategetic.

The Cape Town Tourism Board approved the appointment of Strategetic in July 2011 for a six month period (until the end of December, 2011) after a Request for Proposals (RFP) was released in June 2011 for “Strategic Support to Cape Town Tourism for the development and implementation of a Cape Town Marketing and Brand Campaign.”

In line with Cape Town Tourism’s procurement policy, the value of the contract did not necessitate a public tender process, but rather a public request for quotations. For the sake of transparency, Cape Town Tourism published an RFP on Cape Town Tourism’s website, on Trade World, and circulated the RFP to consultants on Cape Town Tourism’s database.

Three proposals that met the key criteria with quotations were short-listed and evaluated by the Cape Town Tourism Board. The Board was satisfied that due process was followed, that Strategetic’s proposal best addressed the RFP criteria and that they presented the most appropriate global destination marketing and brand campaign experience – a specific requirement for Cape Town Tourism in light of the need to grow demand in global markets. The business model and fee structure proposed was the most competitive and allows for a risk-share scenario, which ensures greater accountability and will allow for the generation of additional income.

The lead consultant put forward by Strategetic was Ian Macfarlane who has extensive global tourism marketing experience complemented by a good local knowledge and understanding of Cape Town and South Africa, having lived in Cape Town for 18 years and worked in various corporate senior management positions whilst based in the city. To be relevant in the international arena in which Cape Town competes, access to international best practice and expertise, coupled with local knowledge, is very important.

Macfarlane’s verified qualifications and experience include:

  • B. Com., UNISA 1980 – 1984
  • MBA, UCT, GSB, 1985 – 1986
  • M. Phil (applied environmental ethics). U. Stellenbosch) (1996 – 1997)
  • Adjunct Professor: Victoria University Melbourne, Tourism and Hospitality Research Centre
  • Previous Board Member Ehrenberg-Bass Marketing Institute, University of South Australia, Adelaide (2007 – 2010)
  • Previous Board member Tourism Research Council New Zealand
  • GM Marketing Tourism New Zealand (1998 – December 2003)
  • CEO Gold Coast Tourism, Queensland. Australia (2004)
  • Director Marketing, Tourism Australia, Sydney (2005 – 2007)
  • Strategetic Consultants (2007 to date)

Macfarlane has also consulted on a number of tourism projects, including:

  • Brand and marketing strategy for Abu Dhabi (Abu Dhabi Tourism Authority)
  • Product and experiences development for Alpine regions for Victoria
  • Adelaide: Brand strategy (City of Adelaide)
  • Sydney: Tourism brand and strategy development (Tourism New South Wales)
  • Evaluation of the impact of major events on city brand equity (CRC for Sustainable Tourism)
  • Brand strategy for Sydney Olympic Park (Sydney Olympic Park authority)

It is noteworthy that the entire marketing strategy and subsequent execution of 100% Pure New Zealand was Macfarlane’s work. The campaign is often quoted as the most successful tourism campaign ever, and resulted in market share and visitor increases for its entire duration. It still is being executed some 13 years post-launch, which is testament to its solid strategic foundations.

Regarding the inaccuracies presented in the blog, the following warrant a response:

  • The blog’s remark that the campaign cost was $180 million is incorrect. This was possibly confused either with the gross operating budget for Tourism Australia, after overhead deductions) or the unsubstantiated political spin, of the time. The budget for the So Where the Bloody Hell Are You campaign was $18m in year 1 (2006) and $10m in year two (2007).
  • The campaign was not banned in the UK and was flighted there for about 12 months.
  • Research on the campaign, undertaken by highly credible companies, show that the campaign was positioned perfectly on-brand and had good audience responsiveness.
  • Given that the campaign was developed largely to achieve publicity for Australia as a top tourist destination, it substantively achieved its goals. In fact, it is still recalled even after Tourism Australia has run a further three campaigns.
  • With reference the suggestion in the blog of visitor declines to Australia as a direct result of the campaign, it must be pointed out that, given the multi-dimensional array of factors affecting arrivals, the suggestion that the campaign alone dampened visitor arrivals is incorrect and without substantiation.
  • Since it was a global campaign, and was used in all markets, the arrivals (which were not one of the defined measures of the campaign) actually increased during and after the campaign (Tourism Research Australia, IVS Annual Reports – 2007 and 2008).
  • With regards to Macfarlane’s proposition that the exchange rate has little to no bearing on tourism arrivals, research on this matter has been conducted by both Strategetic and also by Tourism Research Australia, who published a report substantiating this; Factors Affecting Inbound Tourism; Tourism Research Australia, (June 2011 – ISBN: 798-9218121-43-9). We will be hosting a seminar dealing with, amongst other things, this topic later this year, for those who are interested.
  • .co is a legitimate address; this can be verified by Melbourne IT (either in Australia or US).

In terms of research, it is true that much money is being wasted by tourism organisations undertaking spurious research; obtaining precise measures to support ‘researched based marketing decisions’.  Much of this research is wasteful as it is predicated on product decision-making models. Criticisms of these approaches have been uncovered and substantiated by many esteemed academics. Cape Town Tourism does believe in research, but preference must be given to customer-centric research rather than purely academic research. Macfarlane has extensive experience in the field of research having graduated with a Distinction in Marketing Research (MBA 85/86) and having worked with many research agencies designing research projects and executing them throughout the world.

The fact that Macfarlane has worked extensively with global media companies is an asset to Cape Town’s tourism establishment.

Macfarlane remains contracted to Cape Town Tourism and as an independent consultant, as agreed in his contract schedule, he is able to travel between projects and clients. He returns to Cape Town on September 5, 2011.

The industry entrusts the strategic leadership of Cape Town Tourism to an industry elected Board who has the fiduciary duty to ensure compliance, good governance and the appointment of a management team with the ability to implement and manage the organisation’s operational plans and activities. Cape Town Tourism welcomes the right of any member to know more about our procedures and motivations behind our appointments, strategies and activities. We are more than happy to answer questions to the best of our ability in furthering our commitment to transparency and accountability and we always appreciate constructive input”.

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

UK tourists looking for tailor-made holiday packages and adventure!

I missed the Cape Town Tourism member presentation by Mary Tebje, Cape Town Tourism’s Trade and Press representative in London, in Cape Town in April, and was alerted to it by Commenters to our blogpost about Cape Town Tourism’s depressing forecast for the tourism industry for the next three years.

The reality is that the UK market, the largest source market for Cape Town, is severely depressed, and this is already making itself felt in extremely poor forward bookings from that country.  The high unemployment, increased air passenger duty, fuel price increases, a VAT increase, and an unheard of inflation rate at 4,5 % have created ‘a pessimism not seen since the 1940’s’, Ms Tebje said.  This has led to the ‘staycation’, with the British being forced to holiday at home. 

The Cape Town Tourism summary of Ms Tebje’s talk is thin, but the bottom-line is that Ms Tebje recommended that tourist packages should be put together for the UK market, and should certainly include cultural experiences.  Guests would want to book a number of activities in all-inclusive packages, so that they did not have to worry about extras to pay for whilst on holiday.  This requires a collaborative approach between accommodation providers and tour guides.  In a discussion at the meeting, the ‘township tour and gum-boot dancing routine’ were felt to not be a worthy representation of Cape Town’s culture. 

Miss Tebje profiled the typical UK traveller as being the ‘over 50s market’, a booming one, which has money, and is largely interested in cultural experiences.  Day trips are popular, and should include food and wine. “Teach them to braai”, she recommended, as the UK visitors love to bring home their newly acquired culinary skills, and to talk about their cuisine experiences.  In 2010, 450000 tourists visited Cape Town from the UK, and a quarter of these came to visit friends and family. Yet Ms Tebje painted a contradictory picture of the UK visitor, saying that they spend three hours per day in the sun, and an hour and a half in the bar, according to a survey undertaken by TripAdvisor!  “In fact, we are so busy boozing and bathing that Brits often neglect cultural pursuits, rating the worst in Europe for museum visits and other cultural activities”, she said.  Ms Tebje said that the UK tourists are looking for more adventure from their holidays these days, and therefore they are now travelling to Borneo and Bolivia.

Ms Tebje said that Cape Town was competing with destinations such as Orlando and Spain too, and that the Cape Town accommodation prices were not inexpensive.  Added to this was the feedback that Ms Tebje had received from tour operators selling the Cape in the UK, feeding back to her the negative effect of the strong Rand, the high cost of flights to our country, shorter booking lead times, poor perception of value for money, and price sensitivity.

The Cape tourism industry will have to look for tourists from Germany and particularly South Africa, to survive the poor coming summer season.  It won’t include too many visitors from the UK!

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