Cruise passengers could bring US$90 million in retail spend to Penang
Having joined forces with the Malaysian Association of Tour and Travel Agents in November 2018, Cruise Lines International Association (CLIA) Asia is stepping up its efforts to drive cruise education and awareness in Malaysia with its latest MoU signing with Malaysia Cruise Industry Association (MCIA).
“CLIA Asia’s mandate is to provide essential training, resources and support to travel agents in the region. Globally, we see that cruise markets with the highest market penetration have the most “cruise educated” travel agents,” Joel Katz, CLIA Australasia & Asia managing director said.
Cruise docking in Penang
The partnership with MCIA with provide CLIA with the opportunity to better equip members with better skills to promote and sell cruise holidays.
Meanwhile, MCIA will leverage CLIA’s expertise to educate their travel agent members and raise the profile of cruise tourism.
“(Cruising) has seen tremendous growth and interest in Malaysia, and our members are keen to market and sell more cruise holidays,” Rashid Khan, president, MCIA said in a statement.
According to CLIA’s Asia Cruise Trends 2018 report, Malaysia cruise source passenger count saw a 88 per cent year on year growth in 2017, but cruise penetration rate in the country is still comparatively low at less than 0.6 per cent.
TUI Blue Sarigerme Park is the first hotel under the TUI Blue brand, opened in 2016
Tui Group will make Tui Blue its global flagship hotel brand, targeting portfolio growth from 10 to around 100 hotels by 2020.
From summer 2020, the group will cluster the tailored offerings of its hotel brands Tui Blue, Tui Sensimar and Tui Family Life under the Tui Blue flagship brand.
TUI Blue Sarigerme Park in Turkey is the first hotel under the TUI Blue brand, opened in 2016
Tui’s other hotel brands and concepts will not be affected. Alongside Tui Blue, Tui Group’s growth strategy will continue to focus on its traditional Riu brand, its two club brands Robinson and Tui Magic Life, and the five-star resorts run under the Tui Sensatori brand.
The expanded portfolio of Tui Blue hotels will enhance the visibility and relevance of the brand, the group said in a statement.
Apart from its already strong footprint in southern Europe and the Caribbean, Tui Group and its Hotels & Resorts segment will also focus on other growth regions including South-east Asia and the Indian Ocean, regions it has identified as having high potential for Tui Blue.
The strategy to further expand the group’s market presence is not only being implemented by Tui’s own hotel companies but also supported and driven ahead by partnerships with joint venture partners, including Atlantica and Grupotel, and third-party hoteliers, according to the group.
“Hotels remain a strong and attractive growth segment… What we were lacking was a hotel brand with a global presence incorporating Tui in its name,” said Fritz Joussen, CEO of Tui Group.
“Since the development and launch of Tui Blue three years ago, the Tui brand name has become part of the hotel experience. After the successful launch phase of the first 10 hotels, building the brand as our global flagship hotel brand is the consistent next step for us to significantly expand our hotel segment, go even more global with the brand and increase the target audience.“
The flagship brand will target particular segments, with Tui Blue For Two an adults-only concept in line with the previous Tui Sensimar hotel brand, whereas Tui Blue For Families has specifically been tailored to meet the needs of large and small families.
Meanwhile, individual services such as Select Your Room will be available to an even larger number of guests. The technology concept relating to the Blue app will also be launched in all hotels.
Indonesian unicorn and OTA Traveloka has expanded to Australia as it partners the tourism ministry on a campaign to boost arrivals into the country.
The online booking provider started operations in Australia last week, allowing Australians to access its five products; flight ticketing and hotel booking services, flight ticket and hotel packages, airport accommodation, entertainment and utility services through its website and application.
Traveloka global partnership head Yady Guitana as saying that Australia is relatively ahead of South-east Asian countries in terms of internet connection and penetration as well as payment infrastructure.
He said: “We hope that our digital presence in Australia can further enrich lives of our users by empowering them to discover the world around them by offering a various travel and lifestyle products in one platform.”
Traveloka has also partnered the Indonesian Tourism Ministry on the Wonderful Indonesia campaign, which is aimed at helping the government reach the target of 20 million foreign tourist arrivals this year, Yady said.
Edy Wardoyo, deputy of marketing development 1 at the Indonesia Ministry of Tourism said: “The government’s target to attract 20 million foreign tourists will not be achieved if it does not synergise with players in the industry. Together with Traveloka, we hoped this synergy can help our mission, and we will continue to support Traveloka to exist in this new market.
“The Australian market itself is one of the promising tourism markets, where foreign tourist visits from Australia to Indonesia continue to increase year on year. Traveloka’s decision to open in the Australian market is very important to help in facilitating travel access and answer the diverse travel needs of users,” added Edy.
Indonesia was the second-top travel destination for Australians after New Zealand in 2018, according to market research and business intelligence portal Statista.
Statistics Indonesia recorded 1.3 million Australian tourist arrivals in the country in 2018. The tourism ministry expects to see the number increase 15 per cent this year to reach 1.5 million.
The Ritz-Carlton, Pune is expected expected to open in September 2019 as the brand’s second property in India and one of three Ritz-Carltons in the pipeline for the country.
The hotel is the outcome of a long-term management agreement between the brand and Panchshil Corporate Park Private.
Rendering of Ritz-Carlton, Pune
With 198 rooms, The Ritz-Carlton, Pune will house an Indian, Japanese and all-day dining restaurant, a lounge, fitness facilities and a spa with eight treatment rooms. Additionally, there will be 3,344m2 of indoor and outdoor banqueting venues, and guests staying on the Club Floor will have access to a rooftop Club Lounge where five F&B presentations will be served daily.
Commenting on the city’s potentials, Paul Foskey, chief development officer, Asia Pacific, Marriott International, said: “Pune attracts a mix of business and leisure travellers and shows potential for continued growth in the luxury segment.”
The Ritz-Carlton, Pune is expected expected to open in September 2019 as the brand’s second property in India and one of three Ritz-Carltons in the pipeline for the country.
The hotel is the outcome of a long-term management agreement between the brand and Panchshil Corporate Park Private.
Rendering of Ritz-Carlton, Pune
With 198 rooms, The Ritz-Carlton, Pune will house an Indian, Japanese and all-day dining restaurant, a lounge, fitness facilities and a spa with eight treatment rooms. Additionally, there will be 3,344m2 of indoor and outdoor banqueting venues, and guests staying on the Club Floor will have access to a rooftop Club Lounge where five F&B presentations will be served daily.
Commenting on the city’s potentials, Paul Foskey, chief development officer, Asia Pacific, Marriott International, said: “Pune attracts a mix of business and leisure travellers and shows potential for continued growth in the luxury segment.”
Wyndham Acmar Klang will open in 3Q2019 as the first international upscale hotel in the Malaysian city of Klang.
Housing KLIA, Malaysia’s main international air gateway, and Port Klang, one of the world’s busiest container ports and Kuala Lumpur’s main cruise hub, Klang is an integral part of Malaysia’s national economy.
Rendering of the upcoming property
“As the commercial gateway to Malaysia and a highly connected urban centre, Klang is at the core of Malaysia’s economic success. The entire Klang Valley area is enjoying tremendous growth making this an (opportune time) to introduce a world-class hotel,” said Joon Aun Ooi, president and managing director, Wyndham Hotels & Resorts, South-east Asia and Pacific Rim.
Wyndham Acmar Klang will offer 488 guestrooms across two wings – from Deluxe Rooms to 188 suites. Guests staying in the suites can also make use of the Executive Lounge which provides private check-in, daily breakfast and all-day drinks and snacks.
For meetings and events, the hotel has a Grand Ballroom seating up to 2,200 guests. A selection of 11 other flexible spaces provides options for every type of event.
Facilities include an outdoor pool, spa, fitness centre, retail outlets and a selection of dining venues including Japanese and Chinese restaurants and an all-day dining outlet serving Malaysian favourites and Western cuisine. Also available are a lobby lounge; pool bar; and a sky lounge.
At present, Wyndham Hotels & Resorts has a portfolio of four hotels and resorts across Malaysia, including a Days Hotel & Suites property in Kuala Lumpur and Ramada-branded hotels in Kuala Lumpur, Melaka and Johor Bahru.
Gone are the days where travel agents are needed to plan and book simple beach vacations or run-of-the-mill packages, a trend that DMCs and tour operators are only too keenly aware of.
But the earlier prediction of travel agents going obsolete with the rise of the Internet and OTAs did not entirely come true. While some agents died out, quite a few remain in business and offer a stronger value proposition than before.
The growing demand for immersive, authentic experiences tailor-made to individual liking and preferences actually bodes well for travel expert, driving many tour operators to carve our clearer positionings and niche segments for themselves, anything from VIP services and expert-led itineraries to bona fide, once-in-a-lifetime voyages of discovery.
David Kevan of UK-based Chic Locations believes that “there is still good scope for tour operators but (they) cannot be all things to everybody”.
“For Chic Locations, independent experience-led touring holidays is the way to go, combining at least three different places and maybe using three different airlines – things that clients have neither the confidence or expertise to arrange themselves,” said Kevan.
The ability to curate and “find gems that (clients) can’t find on the Internet” is precisely how Asie Voyages’ Philippe Roussel sees his strengths as a French tour operator specialising in the Far East.
Particularly in South-east Asia, it’s “not easy to find gems” without guidance from a travel expert, he is quick to point out.
That is where the local destination knowledge and expertise of DMCs come in, said Stephan Roemer, CEO of Diethelm Travel Group.
“We cannot sell (standardised tours) anymore,” he said. “But what I can sell is a simple noodle shop, where locals sit on stools for lunch. It’s an authentic experience and (our clients) love it. It’s our job to find the best noodle shop (in a destination)… and that’s how we make a difference and create added value.”
Personalisation: harder work, but greater profitability
Travel players speak of the greater dividends found in customising tours, an area where many companies have devoted attention and efforts to.
Even though classic tours still make up business “volume” for Go Vacation Thailand, the demand for classic group series and SIT tours have declined over the years, shared business development director Tobias Fischer.
Growing demand for personalised travel has put a spotlight on the expertise of travel agents
In place, Fischer sees a clear pivot towards private group tours as traveller can better dictate what they want in their itineraries and elements adjusted to their liking.
Along with “bigger profit margins” that tour customisation has brought is “more work”, admitted Fischer, who added that Go Vacation has a tailor-made department to cater to such requests.
“But that’s precisely where the future of DMCs and travel agents lie. It’s the future of what the market wants, especially for repeaters,” he emphasised.
Likewise, Nicola Scaramuzzino, country manager of Panorama Destination (Thailand) noted that the tailor-made market, which is characterised by organic growth, has yet to deliver volume for the company. In the mean time, he asserted DMCs still need both segments to stay viable, with group series generating quicker cashflow while tailor-made tours offer bigger opportunities in profitability.
Complexity in ‘fitting puzzles’
The growing demand for customised travel has opened up several concerns for travel experts, including greater time, effort and knowledge needed to draw up a value proposition for their clients.
Creating a customised programme requires strong industry knowledge as well as interpersonal skills, pointed out Scaramuzzino, as travel designers “need to know the psychology of customers and ask a lot of questions in order to provide correct products”. “It’s like putting pieces of a puzzle together,” he opined.
At the same time, the growing tailor-made wave has opened up a more “interesting” career path for reservations staff, noted Scaramuzzino. As reservations staff acquire industry knowledge and hone their skills by “learning tricks to create the right package for the right people”, they can eventually rise up to become travel designers.
“You cannot be a chef without learning to chop onions,” he added, drawing the analogy to a professional kitchen.
Travel experts also spoke of constraints in delivering quotations for a customised itinerary within a short turnaround time, the result of consumers having constant access to information and their mobile devices in a hyperconnected world.
Said Scaramuzzino: “(In an age) when booking flights take longer than five seconds, replying (to clients) within 24 hours is considered a long time.”
The ever-shortening response time expected of travel agents is something Roussel is all too familiar with. “But a la carte tours don’t happen with clicks, it would take more time (for us) to get back (to requests),” he stressed. “(Furthermore), it takes about 10-15 requests to translate into one booking.”
That said, travel experts told TTG Asia said that totally fresh demands that require conceptualisation from scratch are far and in between, with most customised requests falling in an area where existing itineraries can be used and adjusted to customers’ preferences.
Scaramuzzino shared: “Anyone requesting for something entirely new are very few. You can classify customers into a few broad profiles – nature, beach and culinary – and from there send them sample standard programmes (according to their profile types) to gauge interest.
“There’s usually a 50-50 chance of acceptance,” he said.
Wither the DMC-tour operator relationship?
As more tourism players get into the personalisation game, the supplier-DMC-tour operator-retail agent-travel customer chain also comes under greater scrutiny.
Kevan argues that the need for a DMC is now lesser in a mainstream destination like Thailand, which has a high repeat visit factor and where clients’ itineraries are generally less complex – characterised by longer average length of stay, fewer stops and local sightseeing booked on the spur of the moment – than ‘newer’ destinations the likes of Vietnam and Sri Lanka.
“If you are established in (a destination), you probably have a direct rapport with your main hotel partners, so from a financial and operational view you have more control of the booking, which in turn leads to a better (and more seamless) experience for the clients,” said Kevan.
He added: “Most DMCs work to set office hours and (outside of that are) contactable via an emergency number, but that would not include booking tours. By contrast, the hotel concierge is available at least 18 hours a day and can arrange something totally personalised within 30 minutes.”
But hotels’ encroachment into offering personalised travel services could pose existential concerns to tour operators too, Kevan acknowledged, while stressing that competition is not new in the travel sector.
“The days of tour operators working in tight collaboration with airlines and hotels are gone; in many ways we are competing against each other,” he remarked.
While tour operators worth their salt would have built up personal relations with hotels and have some kind of data protection agreements in place to limit the scope that hotels can approach clients directly” the reality is that many of the hotels want direct bookings, he opined.
Ultimately, the best form of insurance for business survival will be “added value”, stressed Roemer.
“Any link in the value chain has to provide visible additional value, and that goes from the travel agent to the DMC and the provider. The client can nowadays book his hotel and transportation directly without travel agent. The added value however makes the difference and has to prove its value for money.”
How did the merger of Diethelm and Tourasia come about?
The owners (Keller family) of Diethelm and I met from time to time; they saw what Tourasia did and I knew what they did. It was late 2016 when they approached me and asked ‘why not bring our ideas together?’
At that time Diethelm had a different focus and we had a different focus. I don’t need to be a big player but I need to be a special player. Tourasia was like a handicraft – we offered small details which others probably would not go that far for. That were the niches of our companies, and we were very successful with that.
When Diethelm offered me an opportunity to merge with each other, I was quite quickly convinced because (Tourasia’s) model was such a small-scale niche that we couldn’t scale up or develop further; and for Diethelm I didn’t see at the time much chances for them to grow with their model (otherwise).
The business (of travel) has changed completely and that made me decide (to take) Diethelm and our smaller companies into the 21st century with a clear strategy.
What were the first things you did following the merger?
The first thing after I came here was to start a clear positioning turnaround at Diethelm – what do we want and where do we stand? Diethelm didn’t have a clear positioning at that time, they were doing everything. I was convinced you cannot do everything.
Number two was Diethelm’s organisation structure – it was not a modern organisation any more and nobody changed that. If you want to steer forward, you need to have the vehicle to steer forward, not with a huge truck behind, which was the case with Diethelm.
After the repositioning I started to work on the organisation. Our organisation is now much faster, much leaner and much more accurate. We underwent a complete change and had considerably less executives.
What are the results of this flatter organisation structure?
We have considerably less management positions, but the positions we have are now entrepreneurs; they are not just managers any more. I have to change the mindset of the company and management. It’s a process; it’s not done from today to tomorrow.
We changed the organisation completely by giving competences to the front. I knew from the beginning it’s a risk because mistakes would happen and mistakes have happened but there will be less and less with time. If I do my calculations, it certainly costs me less at the end of the day to have a smaller (reporting) chain than a bigger one, and in the future there will be less mistakes.
Can you imagine if you’re close to the client and you (want to) make a decision in favour of them, but if you have to refer the decision (upwards), most likely the (outcome) will (not) be made in favour of the client. Staff closer to the clients think, act and decide for them – this is what we see already. We are much, much more client driven.
So the recent changes were more about introducing a clearer positioning for Diethelm.
Yes, very much so. Actually it was more a consolidation. We let certain clients go and we gained a number of new clients – and quite a big number of new clients and even some former clients of Diethelm came back. Because they see what we do and we can show them where our position is nowadays – it’s a hard fact.
And within a year at the driver’s seat, you managed to steer the company of the doldrums.
Yes, we did. The two quarters (1Q and 2Q in 2018) were the best over the past 10 years in terms of profitability. I expect to come close to a balance out in the fiscal year, and we’re aiming for profitability, which was not the past case. 2019 will be profitable. 2018 will certainly be on a solid, balance out level, considering the losses that were written out before.
What about the recent merger with Travel Center Asia (TCA)? Has that brought any synergy?
There are synergies, yes. TCA is exactly following an added value philosophy, which fits ours. TCA also has a succession question – owner Thomas Maurer is of retirement age – but their clients are not willing to move somewhere and are looking for someone who can provide what they had in the past. Maurer has a high responsibility and would certainly not just let his clients go, and he approached us with the idea if we could provide what he’s doing.
We saw an opportunity in TCA. One, we can take over the business aspect. Two, we can give a future for their staff and we needed professional staff. Third, Diethelm has been in this building* for 30 years, and we questioned being in such a prestigious but expensive location in Bangkok, (when the office) did not have more modern facilities. I need an office that’s 21st century compatible with daylight and modern air-conditioning system, so we reconstructed our office there (at TCA premises).
What do you see in the future of tour operating?
One, we have to be much closer to the clients, and two, our jobs have changed with digitalisation; if you don’t add value you’re out of the chain and not needed anymore. You have to consider that every client can book a hotel directly – whether they book it with me or the hotel they get the same bed. So I need to put added value to every service or entire package. The 21st century business is added value, otherwise we don’t need to exist anymore, and that is what I’ve been changing (at DTG).
We make holidays the way clients want it. What I’m giving (to clients) is the complete package on an added value. He exactly tells me what he likes to do and we do it the way he wants, we provide him all the facilities that we have and he benefits from that, he actually enjoys his holiday much more than he would had he done it by himself.
*Editor’s note: DTG was still based in its old office at Kian Gwan II Building on Bangkok’s Wireless Road at the time of interview. The company has since relocated to its new premises at ITF Tower on Silom Road.
Authorities and MSC Cruises in talks to dock MSC Lirica (pictured) in Tokyo during the event
Concerned about a significant shortage of hotel accommodation when Tokyo hosts the 2020 Olympic Games, the Tokyo Metropolitan Government is working with travel agencies and cruise ship operators to use luxury liners as floating hotels for the duration of the event.
Just 16 months ahead of the opening ceremony for 2020 Tokyo Olympics, Mizuho Research Institute has released a study suggesting that there will be a shortfall of 14,000 hotel rooms each night during the Games.
Authorities and MSC Cruises in talks to dock MSC Lirica (pictured) in Tokyo during the event
The Tokyo government is in discussions with Switzerland-based MSC Cruises over docking the 65,000-ton MSC Lirica at Tokyo’s No 15 pier for the duration of the event. The cruise liner has 992 guest rooms.
“Our cruise ship has all the facilities of a hotel and would be suitable, but the discussions with the city authorities are ongoing and no final decision has been reached yet,” said Hiromi Tomioka, head of the the cruise operator’s marketing department.
Using cruise ships as moored hotels is “complicated,” she admitted, as a ship needs to meet the city’s regulations on conventional hotels, such as the removal of waste and the provision of water.
Domestic travel giant JTB Corp has overcome those problems and started to market rooms aboard the Sun Princess, which will be docked in Yokohama during the games. Rooms aboard the 1,011-cabin vessel start at 30,000 yen (US$271) per night, but rise to 600,000 yen (US$5,411) for the ship’s best suites.
“We knew there was going to be a shortage of accommodation in Tokyo during the games and that it was important for us to be able to secure rooms for our clients, so we believe this is an innovative and relatively easy solution,” said Kaori Mori, head of branding for JTB Corp.
She added that the travel agencies that have started offering packages aboard the vessel during the Olympics have been receiving “a lot of inquiries, in part because it is going to be totally different from staying in a hotel.
“A lot of people like the idea because they’re getting the experience of a cruise at the same time as being able to attend the Olympics.”
Cruise ships were also used to provide additional accommodation at the last two Olympic Games, in Rio de Janeiro and London.
A record 31.2 million foreign tourists arrived in Japan in 2018, up 8.7 per cent on the previous year to mark a new record high. Tourism authorities here expect to hit the government’s target of 40 million arrivals in 2020.
Thai Airways reports loss, but RPK was up from previous year
After routes from South-east Asia to Europe were disrupted due to the closure of Pakistani airspace, airlines have gradually resumed operations.
Singapore Airlines rerouted all flights over the affected airspace on Wednesday and Thursday.
Thai Airways reports loss, but RPK was up from previous year
Thai Airways International (THAI), which was seeking approvals from the relevant authorities to divert its flights, has resumed normal operations to Europe, having received permission to operate through China’s airspace.
THAI’s flights from Bangkok to Europe today (March 1) will operate as follow:
Meanwhile, budget carrier Scoot cancelled its Singapore-Amritsar return service on Wednesday, following the closure of the airport in north India, according to the Straits Times.
The LCC has since resumed operations. Its relief flight left Changi Airport at 17.00 on Thursday.
Traveloka global partnership head Yady Guitana as saying that Australia is relatively ahead of South-east Asian countries in terms of internet connection and penetration as well as payment infrastructure.
