Waldorf Building | WhaleTales Blog by Chris von Ulmenstein

After having met Wesgro CEO Nils Flaatten two months ago, a week after he had taken over the responsibility for marketing the Western Cape from Cape Town Routes Unlimited, which organisation was incorporated into the trade and investment promotion agency on 2 April this year, we requested feedback about the progress made in marketing the region. Mr Flaatten had asked the industry to give him a month to get the organisational integration completed. An e-mail request for feedback on the marketing progress earlier this month led to an invitation by Mr Flaatten to meet with him on Tuesday.

The most exciting news for the local tourism industry, and Mr Flaatten’s first major challenge, is the 5 July meeting called with SAA’s General Manager Theuns Potgieter by Wesgro with 15 players in the Western Cape, including local and city government, an Eastern Cape tourism marketing body representative, and larger tourism companies, to discuss SAA’s decision to cut its Cape Town-London route as of 15 August. The airline will be asked to motivate its decision in culling the route. Joint destination marketing between the Western Cape and SAA in bringing in tourists from destinations such as Beijing, Sao Paulo, Mumbai, Melbourne, various African destinations, and Buenos Aires will be discussed too. Subsequent meetings will be held with the airlines which will continue to serve the Cape Town-London route, including BA, Virgin, and Emirates, to discuss bringing in more flights to Cape Town.

The parking organisation was perfect, and Mr Flaatten chose for us to go to Doppio Zero on St George’s Mall for the meeting. He had copies of the slides which he used for his recent presentation at FEDHASA Cape’s AGM, which I had requested via his secretary, but the wait was worthwhile, as Mr Flaatten was able to explain his points in greater detail. Mr Flaatten is a very precise person, and he referred repeatedly and proudly to the progress that he and his new team have made in the ‘two months and 19 days’ since their integration. In the past 80 days Wesgro has undertaken the following Marketing activities:

* Mr Flaatten and Solly Fourie, Head of the Western Cape Department of Economic Development and Tourism, accompanied an (unnamed) Chairman of a JSE-listed hotel company to Buenos Aires, to meet six outbound tour operators. Mr Flaatten praised their product knowledge of the Western Cape. He said that the withdrawal of the Cape Town-Buenos Aires Air Malaysia route is a serious blow to tourism from Argentina. His journey from Cape Town to Buenos Aires via Johannesburg took 24 hours, previously a direct flight of 7 hours flying west.

* Bjorn Hufkie from Wesgro’s Conventions Bureau accompanied the (unnamed) Managing Director of a JSE-listed hotel company to Saudi Arabia and Kuwait

* Participated in exhibitions: Arabian Travel Market in Dubai, IMEX 2012 in Frankfurt (incentive travel, meetings and events); and Indaba in Durban. Mr Flaatten said that all six the RTOs were represented on the Western Cape stand, and that they will ‘raise the bar’ for 2013.

* Debbie Damant has been part of SA Tourism’s marketing mission to China and Japan

* Met with Cape Town Tourism, the largest RTO (regional tourism organisation) of the six in the Western Cape, asking some ‘tough questions’ of them

* Met with Eden RTO, and some of its LTO’s (local tourism bureaus)

* Met with SAA at Indaba (prior to SAA’s bombshell announcement about the Cape Town-London route)

* The Western Cape Tourism Barometer for the fourth quarter of 2011 was released.

* The Wesgro website has been updated, incorporating its new additional Destination Marketing role, clicking through to the tourism information previously on the Cape Town Routes Unlimited website

* One of the greatest achievements is the detailed listing of over 100 events in the province in the next six months, with detailed information about each event

* Organisationally, the activities and marketing focus of the six RTOs (Cape Town, West Coast, Eden, Cape Winelands, Central Karoo, and Overberg), and its tourism bureaus within the municipalities within the RTOs have been captured, within a Customer Relationship Management program. An intensive Facebook campaign to interlink and like the LTOs and RTOs is underway.

Looking ahead for the next 10 months the focus will be to deliver on the Annual Performance Plan in respect of destination marketing; create operational efficiency, effectiveness and cost savings, which savings will go into the Events budget, Mr Flaatten said; fill staff vacancies; strengthening relationships with the RTO’s and LTO’s, international airlines operating from Cape Town International, tourism trade bodies, SA Tourism, and other national tourism bodies; ‘impactful marketing and advertising of the destination’, website integration and marketing strikes in respect of tour operators, to keep up the ‘share of mind’; aggressively market the Conventions Bureau, pushing conferences into the provincial towns and villages too; stimulate Events and fund smaller events; and SMME development. Wesgro is pitching to host SIAL Cape Town, which would become a fantastic new food event creating a ‘Global Food Marketplace’, already held in Paris and China, and is planned to be hosted in our winter months, to address Seasonality. The Western Cape Tourism Marketing Plan is expected to be ready by September. Inter-provincial travel within the Western Cape will be an important focus. Mr Flaatten was requested to provide feedback on what Wesgro is doing for the tourism industry as frequently as possible, all media communication to ourselves having been terminated since Wesgro took over. We fed back that the Tourism Bureaus are not passing on Wesgro’s information to its members, which seemed to surprise him.

Mr Flaatten provided a copy of the latest Tourism Barometer, surprisingly signed off by Calvyn Gilfellan, former CEO of the ex-Cape Town Routes Unlimited. In the last quarter of last year 216000 international tourists arrived in Cape Town, a welcome increase of 15% over the same period a year before. Domestic arrival growth was far lower in the same period, at 4%, with just under 1 million visitors. A large part of the report contains statistics of visitor numbers to the province’s key tourism attractions, and to the RTO’s local tourism bureaus, a very unreliable tourism barometer, given that fewer visitors require the information or booking services of tourism bureaus, doing most of their bookings at home via the internet before their departure.

Organisationally, the integration between the ex-Cape Town Routes Unlimited staff is complete, section 197 of the Labour Relations Act having been followed, in that all staff (also the Wesgro staff) were offered staff benefits at the higher level of those offered by Wesgro and Cape Town Routes Unlimited, so that all Wesgro staff now receive the same benefits. A Memorandum of Understanding, a Memorandum of Agreement, and a budget have been signed by the Joint Working Committee guiding the integration. The Annual Performance Plan of Cape Town Routes Unlimited has been transferred to Wesgro. For the financial year April 2012/March 2013, Wesgro now has a total budget of just more than R51 million, 45% being for Cape Town Routes Unlimited funding. All ex-Cape Town Routes Unlimited staff now have Wesgro contracts, e-mail addresses, and business cards. Staff have been grouped by functionality and accommodated on the 7th and 12th floors of the Waldorf building. Provincial Tourism Minister Alan Winde’s department is working on repealing the Tourism Act of 2004, which will close down the Board of the ex-Cape Town Routes Unlimited, which currently has to remain operative as long as the current Act is in place.

Wesgro needs to start from the beginning in gaining the confidence of its Western Cape tourism constituency, which had little faith in its predecessor Cape Town Routes Unlimited. The outcome of the 5 July SAA meeting will be a crucial test of its negotiating skills. In addition, it will be judged on its ability to communicate with the tourism industry on a regular basis, via traditional media channels as well as Social Media marketing.

Wesgro, Waldorf Arcade, 80 St George’s Mall, Cape Town. Tel (021) 487-8600. www.wesgro.co.za Twitter: @Wesgro

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

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