A fair future?

March 14, 2014

Will consumer travel fairs – an important source of cashflow and a key marketing tool for travel agencies – come undone by competition from online portals?

The crowd at ASTINDO Travel Fair in Indonesia

A declining footfall at the two main consumer travel fairs in Singapore, Travel and Holiday, over the past three years has thrown a question mark on the future of fairs.

Attendance at Travel 2013 and Holiday 2013, both organised by the National Association of Travel Agents Singapore (NATAS), saw their deepest drops in the last three years of 15 per cent and five per cent respectively. Sales volumes at each show also declined by about S$10 million (US$7.9 million) in 2013, compared with 2012.

Tudor Coman, CEO of Flocations, a Singapore-based meta-search for travel packages, charged that the NATAS fairs are “no longer effective” and are not giving the ROI they used to. And while large players such as Chan Brothers and Dynasty Travel can still afford to participate, the small- and medium-sized agencies “just don’t see the value” and are finding new channels to acquire customers, he said.

He asked: “Why would a consumer go through the headache of a travel fair when he can search the same deals online?”

Coman may have vested interest in expounding the view that fairs are doomed, but he may also have a point. Flocations showcases some 9,000 package deals from Singapore agencies, many of the firms SMEs, and Coman claimed the site gets the same traffic as a NATAS fair every day. This traffic neither needs to go to the exhibition centre for the show nor pay its entrance fees.

Vikram Malhi, Expedia’s general manager, South-east Asia, India and Greater China, Expedia echoed the sentiment: “With online travel agents, consumers have access to deals year-round instead of having to wait twice a year for travel fairs.”

A regional director of an established outbound travel brand which targets a slightly more upmarket clientele said sales from travel fairs in Singapore are down, although the company’s overall sales are up. As a result, the firm is evaluating whether it is worth participating. Over in Indonesia, however, the source noted that sales at fairs are thriving (see box below), but in Malaysia, its GSA makes more sales at the office than at the main fair organised by the Malaysian Association of Tour & Travel Agents (MATTA).

That however is just one agency’s experience. Going by visitorship and booth numbers it provides, the twice-yearly MATTA Fair in Kuala Lumpur is still hugely popular. But the leading, eponymous Virtual Travel Fair (VTF) organised by Smart Online Travel Assistant (SOTA) and co-hosted by The Star Online, the digital unit of Star Publications, is making inroads into the market, thanks to growing awareness of the fair, consumer adoption of online technology and the introduction of mobile application for Android operating systems last year.

Like the MATTA Fair, VTF, which debuted in April 2011, runs twice-yearly, but unlike MATTA, SOTA does not charge members – hotels, licensed agencies and attractions – a fee to trade their deals during the fair to consumers, predominantly Malaysians but also Filipinos, Indonesians, Hong Kong residents and Middle Easterners, according to SOTA’s chief marketing officer, Joanna Liao. VTFs in the past ran from six to 14 days. The first, in April 2011, saw 6,108 unique visitors; by the fourth VTF in September 2012, this rose to 63,381 visitors, and 70,113 in March 2013, SOTA claimed.

This is closing in on MATTA Fair’s 100,000 visitors in March 2013, although VTF’s seller participation is paltry at 70 agencies and 153 hotels, compared with MATTA Fair’s 1,094 booths in March 2013.

Aside from being open 24/7 and hassle-free – going to Putra World Trade Centre for the MATTA Fair can be a nightmare because of heavy traffic – consumers are also offered gimmicks such as a Lowest Price Guarantee, online contests and e-auctions.

Nazarin Chik Abu Hassan, development manager, Honey Vacation Travel and Tours, said sales from MATTA Fair currently is much bigger, around RM500,000 (US$152,625) to RM1 million, than VTF’s RM50,000 to RM100,000. Consumers at MATTA Fair tend to buy full-board packages to medium and longhaul destinations, while VTF customers tend to be younger and have tighter budgets.

“Thus, we sell Europe, South Korea and Japan at MATTA Fair, and mainly domestic and regional tour packages at VTF.

“In future, we believe online fairs will catch on in Malaysia.’

Michael Low, assistant manager business development, AF Travel, also believed online travel fairs will gain momentum in the future. But now, “MATTA Fair brings in better sales, and a spectrum of shoppers from budget to high-end”, he said.

Coman (above) asserts fairs are dying. Tan and Chan said – rubbish.

Not alarming

Consequently, the alarm bells aren’t ringing at either NATAS or MATTA.

National Association of Travel Agents Singapore (NATAS) COO, Anita Tan, said visitorship alone is not an accurate measure of a fair’s success. She said: “The travel fair dates may clash with the festive season or other consumer events that are happening during that period; an economic downturn may also cause consumers to be more prudent with their expenditure.

“Looking at sales volumes and visitor numbers, the average expenditure per visitor has grown over the years. This means that NATAS fairs are in fact attracting a growing number genuine buyers, and that consumers are spending more on their holidays to longhaul destinations.”

In a rebuttal to online players’ views that fairs are losing ground, Tan said: “They are assuming that our fairs are nothing more than deals and discounts. In fact travel consultants are on site to offer a great deal more services such as helping customers buy travel insurance and making recommendations on how to customise various aspects of a travel package.”

Hamzah Rahmat, president of MATTA, said MATTA Fair is like a carnival, where families enjoy performances and not just browse offerings and make purchases. At press time in February, there was a waiting list of 77 booths for the fair this month (March) due to space constraints. “For the September fair, we taking four halls at Putra World Trade Centre, instead of three as in the March fair,” said Hamzah.

MATTA is also looking to give participation priority to its members over non-members such as airlines and foreign national tourism organisations.

Anthony Chan, group managing director, Chan Brothers Travel, Singapore said: “While an online medium is handy for offering basic travel products such as flight, accommodation or vehicle rental, more complex travel products require detailed and lengthy elaboration from dedicated face-to-face personnel.

“Many customers also still want the more personal touch, reassurance of physical customer service staff, payment security and support in an emergency or after-sales service.”

Besides, the divide between online and offline is gray. “Up to 40 per cent of transactions at our retail offices and travel fairs are generated from online enquiries, eventually being closed over-the-counter due to complexity of the products,” he said.

Sheryl Lim, regional director of Asia, Insight Vacations, said travel fairs and roadshows account for 15-20 per cent of the company’s revenue and provide an avenue to create branding and to connect face-to-face with their target audience.

For consumers, it’s “a great platform” to discover various travel offerings and ideas for the next vacation, all under one roof, particularly for those who prefer a personal touch, are less tech-savvy and are time-short.

“A travel consultant is not just a middleman. He offers his expertise in managing complex itineraries and assists with visa submissions, change of travel plans, refunds, cancellations and rebooking,” she reminded.

Agreeing, Richard Yip, director of tour sales and product development, S Travel, said: “The NATAS fair may have lost some ground in terms of the number of visitors but it remains the number one choice for consumers who want to seek the best deals all under one roof. Travel fairs are essential for us as they help us to enhance our company’s branding, showcase our travel products to all consumers and, so far, we have managed to canvass a good portion of our annual revenue through them.”

Nevertheless, to ensure travel fairs continue to have a firm foothold, more value-add must be provided for the visitors.

Insight Vacations’ Lim said: “Travel fairs can be more than a place just for travel bargains; it can be a showcase of new destinations and new travel concepts. For instance, travel experts can be invited to the fairs to share their experiences and expertise.”

S Travel’s Yip added: “Prices (at travel fairs) must also be more transparent, showing customers the cancellation fees and service charges they incur.”

(Ed’s Note: This article was written before the NATAS Travel 2014. At press time, figures for the fair were not available.)

Source: National Association of Travel Agents Singapore

Fairs thrive in Indonesia

Indonesia has seen a growing number of fairs in the last five to seven years, organised by a consortium of tour companies, airlines or travel associations.

Shows such as Indonesia Travel and Holiday Fair (ITHF), ASTINDO Travel Fair, Garuda Indonesia Travel Fair and ASITA (Association of the Indonesian Tours and Travel Agencies) Travel Fair came up in Jakarta in the last few years, some of them held annually, others twice-yearly.

In the early days, outbound travel fairs were designed to grab a bigger piece of the high season pie, but Indonesia’s economic instability in the late 1990s and early 2000s had inspired tour companies and airlines to come up with cheap low-season packages to attract travellers. This worked so well that now “there is a market for every season”, said RajaMICE CEO, Panca Sarungu.

Rising disposable incomes and the entry of financial institutions that allow travellers to pay by instalment with their credit cards further boost the business.

ASTINDO Travel Fair last year attracted 63,000 visitors with a total transaction of Rp73 billion (US$5.3 million) over three days. Of the total sales, 70 per cent was outbound. This year, the fair’s organising committee chairman Anto Haditono targets 65,000 visitors and Rp85 billion in sales.

Garuda’s fair last year attracted some 60,000 visitors with a total transaction of Rp60 billion.

Panorama Group’s managing director, Rama Tirtawisata, said: “Travel fairs change travel behaviours. In the past travellers determine holiday dates and look for available packages, now they plan their holidays (especially short breaks) based on the best deals, which are usually found in travel fairs. In fact, they may not even plan to travel but the deal is so good they buy the package and work on a leave.”

Bernard Akili, vice president marketing and product development, Smailing Tour, said: “Indonesians love deals, so promotional packages, instalment payments with zero interest from banks, plus cashback offers during the show really work.

“On top of that, BCA Bank now offers a zero interest instalment (plan) on overseas shopping to its credit card holders.” About 70 per cent of Smailing’s total sales last year were for the low season period.

Panorama Group’s own travel fair, World of Panorama, which primarily targets year-end holidays, last year contributed a third of group tour business for December last year, said Panorama Tours managing director of Leisure Travel Management, Meity Monica Lukito.

Travel fairs now do not only take place in Jakarta but in other big cities around the country, thanks to the growing middle-class society and improved accessibility to these places.

ITHF has branched out to cities such as Bandung and Makassar; Garuda’s fair is now held in nine cities including Sumatra, Java, Bali and Nusa Tenggara; and ASTINDO’s fair this year will be held in Jakarta and Surabaya.

ASITA Travel Fair, launched in Jakarta in 2012, was held in four cities last year. This year, it will be held in nine cities including Pekanbaru, Palembang, Semarang and Balikpapan. The events are organised by RajaMICE.

Said RajaMICE’s Sarungu: “People with buying power are no longer centralised in cities like Jakarta and Surabaya. More people in the various regions now can travel, thanks to improved accessibility in the country.”

Additional reporting from Paige Lee, Mimi Hudoyo and S Puvaneswary

This article was first published in TTG Asia, March 14, 2014 on page 1 to 3. To read more, please view our digital edition or click here to subscribe.

Patrick Teng joins Aonia Singapore

By TTG Asia

March 13, 2014

SINGPOARE-BASED PCO, Aonia, has appointed Patrick Teng as director of meetings & incentives.

Bringing with him more than 10 years of experience in the industry, Teng’s responsibilities include business development, events management and strategic planning.

Prior to joining Aonia, Teng was vice president of a Singapore-based MNC insurance company, where he played the role of a strategic business developer, corporate events designer and overseer of personnel performance.

More knights in shiny armour for Malaysia’s MICE industry

By TTG Asia

March 13, 2014

MALAYSIA Convention & Exhibition Bureau (MyCEB) has appointed seven new Kesatria – industry leaders who are tasked to elevate Malaysia’s business tourism by helping to identify and encourage peers to bid for and stage international congresses in the destination.

This is the third batch of Kesatria – or knights in the Malay language – appointed under the Kesatria 1Malaysia programme, bringing the total ambassador count to 33.

Zulkefli Sharif, CEO of MyCEB, said: “Our Kesatria 1Malaysia programme has generated 37 successful international business event leads with an economic impact of RM625 million (US$190.5 million) and an estimated attendance of more than 50,000 delegates.

“The success of this programme is reflected in the number of large-scale specialised conferences that have taken place since we started this programme.”

Some of the prestigious events won by the ambassadors include Women Deliver Conference 2013 which generated an estimated RM47.4 million in economic impact to the country, 12th International Congress on Obesity 2014 which is estimated to draw some 3,000 delegates, and XXV International Federation of Surveyors Congress which is also expected to attract some 3,000 delegates in June.

Zulkefli said some of the benefits of serving as a Kesatria include the eligibility for travel assistance for bid activities, invitations to attend networking and special events hosted by MyCEB throughout the year, and being provided with promotional materials to pass on to their international professional contacts that have the potential to stage business events in Malaysia.

Inaugural Asia Cruise Fund calls out to cruise lines

By TTG Asia

March 13, 2014

HONG Kong Tourism Board (HKTB) and Taiwan Tourism Bureau (TTB) yesterday announced they would be jointly setting up the world’s first Asia Cruise Fund.

Effective April 1 and running for three years, the regional co-operation fund will comprise contributions from participating ports and be used to subsidise cruise companies for developing and marketing cruise products.

A major requirement is that cruise lines must deploy vessels to at least two participating ports or territories in a single itinerary.

HKTB executive director, Anthony Lau, said: “The launch of the fund marks a significant step towards regional cruise cooperation, which is vital if the industry is to successfully tap the potential created by the growing population of Asia’s middle class and booming outbound travel over the next decade.

“We believe the fund will show our dedication and commitment to cruise tourism development and reinforce cruise operators’ confidence in deploying more ships to Asia, benefiting not only the participating ports but also cruise lines and other industry stakeholders.”

Commissioner for tourism of the Hong Kong SAR Government, Philip Yung, said: “The Guangzhou-Shenzhen-Hong Kong Express Rail Link and the Hong Kong-Zhuhai-Macau Bridge, which are targeted for completion in the coming few years, will significantly improve connectivity between Hong Kong and southern China.

“By working with neighbouring ports in the region, we believe we can make Asia an opportunity too good to miss for international cruise companies – both as a destination and a rich source of potential passengers.”

Asia holds huge potential for the cruise industry as by 2030, around two-thirds of the world’s middle class will be based in this region, according to a recent report by the UN Development Program.

Northern Territory’ new ambassador programme brings good leads

By Karen Yue

March 13, 2014

SIXTEEN active business event bids have resulted since the launch of the NT (Northern Territory) Business Events Ambassador Program last September.

A joint initiative between Tourism NT, Darwin Convention Centres and Alice Springs Convention Centre, the programme was established to increase new business event opportunities for the destination by maximising the extensive networks and marketplace intelligence of selected business and industry professionals.

Scott Lovett, director business events of Tourism NT, told TTGmice e-Weekly that the NT’s ambassador programme “is very different from others in the country which are often focused on medicine”.

“Ours is aligned with the NT’s forte, which is in areas such as economics and social and community development,” Lovett said.

The 16 founding members of the programme hail from the NT’s key industry sectors such as renewable energy, health, tourism, oil and gas, primary industry, finance and business.

Besides helping to promote the NT’s business events capability, Lovett said the ambassador programme is also crucial in the destination’s pursuit of investments.

“Whenever a destination wants to promote investments in specific areas, it is done through dialogue and exchange of ideas at events and conferences. Thus, we encourage our ambassadors to look at their area of work to attract events to the NT,” he added.

When asked for an example of an ambassador who had opened doors for the NT, Lovett said: “Chen Min (chief representative, China Council for Promotions of International Trade) is big on investment and trade, and is our key to China’s trade ministries and government.”

The NT Business Events Ambassador Program runs alongside Tourism NT’s industry familiarisation programmes, which take trade event buyers to industrial facilities that matter to their business.

“We have a very high conversion rate (for event enquiries) when we take people on such familiarisation trips. The destination is important (in the planner’s selection process) but content and learning opportunities (for delegates) are far more crucial,” he said.

Surveyors congress sharpens content to combat loss of audience to meeting technologies

By S Puvaneswary

March 13, 2014

THE upcoming International Federation of Surveyors Congress in Kuala Lumpur in June will feature more networking opportunities and see collaboration with multilateral bodies such as the UN Habitat on programme content to raise the event’s appeal among delegates.

Explaining the need for strong programme content, Teo Chee Hai, president of the International Federation of Surveyors, said the average size of conferences today has shrunk compared to five years ago, a direct result of an increased number of conferences around the world and the use of technology to replace face-to-face meetings.

Speaking at the 9th Association Seminar 2014 on Tuesday at Kuala Lumpur Convention Centre, Teo stressed that organisers must give a compelling proposition for delegates to attend the conference by having a very strong content.

He said it was about “delivering value and desired outcomes to constituents”.

Networking opportunities at the International Federation of Surveyors Congress were expanded, for instance, after taking into account that such sessions were important to delegates and a key factor in building attendance. Coffee breaks at the congress will be lengthened to 45 minutes.

The congress will be held at Kuala Lumpur Convention Centre from June 16 to 21 this year. It is expected to welcome 3,000 delegates

Corporate travel managers relook risk policies following MH370 incident

By Caroline Boey

March 13, 2014

REGIONAL corporate travel managers say the disappearance of Malaysia Airlines flight MH370 from Kuala Lumpur to Beijing last Saturday is a “wake-up call” to review and implement measures to mitigate corporate travel risk, and put in place better “duty of care”.

Texas-based semiconductor company Freescale confirmed in a statement 20 of its employees were on the ill-fated flight. Twelve were Malaysian nationals and eight were from China.

Michelle Tan, manager, Asia-Pacific Travel Operations, Oracle Global Travel, said review of corporate travel risk and security was being stepped up. On why so many employees were on the same flight, Tan said it was possible the travellers made their own bookings and the company did not know they were travelling together.

“It’s a good wake-up call to review and improve what we currently have in place,” Tan said, adding that only companies with mature and structured corporate travel policies would have limits on how many employees are permitted to travel on the same flight.

Oracle, she said, was monitoring the situation and would be advising its travellers accordingly.

McDermott, which provides offshore field development services worldwide, has in place a corporate travel policy forbidding senior executives to travel on the same flight.

“We also limit the number of travellers on the same fight to 10,” Serene Chua, McDermott Asia-Pacific travel manager, told TTGmice e-Weekly.

She added McDermott had in place an internal authorisation system that would trigger an alert if more than 10 of its employees were travelling together, and has had to stop some bookings.

On the MH370 case, Chua said it could have been a case of more than one agent making the bookings and the data was not shared with the company.

“In some companies, bookings are not be centralised. Some travellers may also make their own bookings using a self-booking tool, or insist on a particular flight when booking with the TMC (travel management company) for convenience or if they want to travel with other colleagues. The TMC may also only alert the company if there is an ‘exception’ about the booking,” said Chua. “As part of improving our duty of care, we will be reviewing what is in place, and if we need to introduce other measures.”

Cathay Pacific ups direct Delhi service

By Rohit Kaul

March 13, 2014

CATHAY Pacific yesterday announced it is making changes to its New Delhi schedule and will offer double daily non-stop flights to Hong Kong starting March 31.

The airline that is at present operating a daily non-stop flight on the sector, will convert its other Delhi-Bangkok-Hong Kong flight to a direct service.

Utilising A330 aircraft for both non-stop flights, the first flight from Delhi will arrive at Hong Kong International Airport at 07.00 and the second flight at 09.25, directly connecting passengers to destinations such as Australia, North America, Korea, Japan, China and the Philippines offered by the airline and its sister Dragonair.

The airline is also planning to enhance the frequency of its Kolkata-Hong Kong service, operated through Dragonair, by adding two more flights by end-2014.

“We have utilised all our traffic rights to India except Kolkata, where we can operate two more flights. We are hoping to operate daily flights to the city by year-end,” said Rakesh Raicar, regional sales and marketing manager, South Asia, Cathay Pacific.

India is among the top 10 markets for Cathay Pacific. The airline saw growth of 25 per cent last year with the addition of Kolkata and Hyderabad to its network.

The airline recorded an average load factor of 82 per cent in India in 2013. It currently operates 47 weekly flights from New Delhi, Mumbai, Chennai, Hyderabad, Kolkata and Bengaluru.

Indian travellers to Thailand on the rise

By Rohit Kaul

March 13, 2014

THAILAND last year welcomed more Indian travellers than the year before, with the kingdom recording about 1.1 million Indian arrivals, growth of four per cent over 2012.

The tourism board is expecting growth of seven to eight per cent in tourist arrivals this year over 2013.

Said Runjuan Tongrut, director, Tourism Authority of Thailand (TAT), New Delhi office: “Cities like Bangkok and Pattaya remained hugely popular with Indians and there was a noticeable rise in demand for the regional destinations of Phuket, Koh Samui, Chiang Mai, Hua Hin, and Krabi.

“Favourite activities for Indians in Thailand continued to be shopping and sightseeing, but there was also significant growth in the number of Indian weddings in the country, golf tours, spa and wellness trips, student travel, eco-tourism and MICE.”

“We will focus on non-metro Indian cities and on creating awareness of our festivals like Songkran and Loi Krathong to fuel growth in the Indian market.”

TAT New Delhi office will also organise a three-city road show In August covering Delhi, Jaipur and Amritsar respectively.

Meanwhile, Thailand is witnessing an increase in demand from women group travellers from India in 2014, despite its political unrest.

“We are noticing a new trend this year with many all-women groups travelling to Thailand for experiential trips. These groups are particularly interested in spas, wellness centres and Thai cooking classes besides exploring new destinations,” shared Runjuan.

Apart from budget and young travellers, TAT is looking to draw more Indian luxury travellers and well-travelled tourists to the country, engaging travel consultants in the promotion of yacht excursions, high-end hotels, exclusive dining and entertainment activities.

Yangon’s hotel room supply to double in short term

By Sid Dhartha

March 13, 2014

THE supply of hotel rooms in Yangon will nearly double in the coming year in an effort to ease the city’s shortage, according to Myanmar’s Ministry of Hotels and Tourism.

Minister of Hotels and Tourism, Htay Aung, said: “More hotels will be granted (licences) to develop to meet increasing demand, especially in Yangon. Numerous hotels are already in construction around the city and a few more are slated to open in 2016 and later.”

The ministry has also issued 166 hotel licences in the past year – on average three new hotel licences per week (TTG Asia e-Daily March 11, 2014).

Figures from the ministry as of December 2013 showed that Myanmar had 923 licensed hotels and approximately 34,834 rooms throughout the country.

Yangon had 232 hotels with 10,175 rooms, followed by Mandalay with 104 hotels (4,439 rooms), Bagan-Nyaung U with 77 hotels (2,386 rooms), Taunggyi-Inle with 70 hotels (1,939 rooms) and Naypyidaw with 50 hotels (4,030 rooms).

Among the 923 licensed hotels, only six were rated as five-star, 17 as four-star, 83 as three-star, 116 as two-star and the rest as one-star/certified.
Htay Aung said the ministry would like to encourage both local and foreign investors to invest in hotel and other tourism-related business which are “very promising” for the investor.

The Myanmar Investment Commission has so far granted permission worth up to US$2 billion of investment into 39 hotels and tourism-related projects.

“We look at the foreign investment hotels and commercial complexes; there are 39 projects with the availability of 8,029 rooms. Only 30 projects with 5,207 rooms have been completed and the other six projects are under constructions,” said Htay Aung.

In 2013, the number of tourists visiting Myanmar surged to over two million compared to one million in 2012, indicating a significant two-fold increase from last year.

The ministry forecasts that in 2014 the number of international tourists will increase to three million.