HONG KONG is stepping up multi-destination development to attract the longhaul market and has inked joint promotion pacts for the first time with Yunnan and Shanxi.

Hong Kong Tourism Board (HKTB) chief Anthony Lau said: “Hong Kong, being a cosmopolitan city, complements well with the natural beauty and minority communities of these provinces and this will keep longhaul markets interested.” HKTB already does joint promotions with Guangdong.

Lau said longhaul arrivals grew 10 to 11 per cent last year, and shorthaul 17 to 18 per cent. “Yes, China remains the driver, with a 27 per cent increase, but we are seeing growth from all markets, with arrivals increasing 22.8 per cent last year to surpass 36 million,” he said.

“I expect this momentum to continue. If there is no volatility, we can do another 10 per cent growth this year.”

HKTB will also expand promotion in India to Bengaluru and Chennai, from only Mumbai and Delhi now. India arrivals rose 44 per cent last year to over 500,000.

It will also invest marketing dollars in Russia, the Netherlands, Vietnam and the Gulf markets. Lau said this was not a shift in dollars from existing markets, but a 10 per cent rise in funds and streamlining costs to achieve greater efficiency.

THAILAND’S ONYX Hospitality Group is on track to achieve its goal of 51 properties by 2018.

Ten per cent of its portfolio will comprise its new luxury brand Saffron and the rest split between the four- and four-and-a-half-star Amari and the three-star focused-service Ozo brand, according to CEO Peter Henley.

The group is also expanding into serviced residences, having bought Shama, a group of serviced apartments founded in 1996, which gives it an inroad into the North Asian market.

Henley is marking many firsts: The first Saffron, Oriental Residence Bangkok, is opening in October, while the first international Amari hotel, Amari Addu Maldives, will open in November. The first new-build, new-generation Amari will open in January next year in Hua Hin.

Construction of the first Ozo Resort, in Samui, will start in the third quarter and is expected to open in the first quarter of 2013.

ONYX has also launched a loyalty programme, Chorus Rewards, as part of its plan to build up loyalty for its brands.

– Full report in TTG Asia

MORE European tour operators are putting the Philippines in their brochures this season.

Kuoni UK is featuring the Philippines for the first time in its brochure out this November. Alexander Stutely, CEO of Blue Horizons Travel & Tours that won the account, said the UK operator will focus mainly on midscale to high-end beach resorts in Palawan, Boracay and Bohol, as well as northern Philippine roundtrips.

Stutely said: “With Kuoni UK selling the Philippines, more big UK players might feature the country. Right now, UK business comes mainly from smaller boutique-style operators.”

Blue Horizons is also the groundhandler for Transorient Touristik’s first ever programme on the Philippines. The Hamburg-based operator devoted 12 to 15 pages on the Philippines in its brochure that came out last November. Boracay resorts are the star attractions, though some properties in Bohol, Cebu and Palawan also made the cut.

Stutely expects Transorient’s production to reach half of Meier’s Weltreisen’s – Blue Horizon’s and the Philippines’ biggest producer for Germany – in the next two to three years.

Meanwhile, Marsman Drysdale Travel has convinced Paradise Reisen to run group series to the Philippines for the first time. Paradise was to start its programme last year but cancelled due to the European Union ban on Philippine carriers. Director of tourism services Pedro Young is expecting Paradise’s first group for the Manila-Banaue-Bohol programme this October.

By Ollie Quiniquini

MARCO POLO Reisen, which described last year as the “India year” for it, has warned the destination not to spoil the gains with a proposed bed and F&B tax which suppliers are starting to negotiate to pass on to tour operators.

“India is keeping its high volume, having recovered so well from the impact of the Mumbai attacks two years ago. But higher taxes, coming when the season has started and the brochures produced, won’t help. These higher taxes are also in addition to increases in room rates and currency exchange rates,” said managing director Holger Baldus.

India “for the first time in decades” became one of Marco Polo’s top three destinations last year, along with China and Indochina. “This is true of both us and (sister) Studiosus,” he said.

Thailand used to be stronger than India but is still “non-existent” due to Bangkok’s political protests.

The Studiosus Group roped in a nine per cent growth in passenger numbers last year, but Baldus expects this year to yield a smaller growth as a result of the Middle East restiveness, which is affecting bookings to destinations such as Egypt, Jordan and Israel. He expects Asia to gain some business from the Middle East political tensions.

EGYPT’S tourism authority is now considering subsidising charter flights to a larger number of destinations within the country as part of a concerted push to win back tourists—one that also has private operators embarking on their own promotional offers.

Egyptian Tourist Authority (ETA) chairman Amr Elezabi said discussions were underway for a “double-touch initiative”, which would see charter incentives extended to include a second airport.

Under the current scheme, Egypt subsidises anywhere between 65 to 85 per cent of empty seats globally, but only for one stop per flight.

Elezabi added that ETA was also now “ready to discuss with serious tour operators in Asia” the possibility of subsidising charters due to the growing importance of the region. There are currently no charters from Asia to Egypt.

In order to speed overall recovery, Egyptian Tourism Federation director general Ayman Altaranissi said there were also plans to reintroduce charter subsidies for the Red Sea destinations of Sharm el-Sheikh and Hurghada, where demand in recent years had been strong enough to not need such incentives anymore.

“All these strategies will require a new budget for charter flights, which is now over 100 million Egyptian pounds (US$16.9 million) a year. We are now calculating how much this will add up to and this will probably be finalised very soon after ITB,” said Altaranissi.

At press time, Elezabi said the ETA was still “building on the actual strategy”, and the overall budget had not been finalised yet. TTG Asia ITB Berlin Daily, however, understands that on the cards are increasing cooperation with agents by dishing out brochure subsidies among others, stepping up marketing efforts using online and social media platforms, and attending all international travel fairs this year.

These would hopefully offer some respite to hotels and tour operators who have noted that demand had dropped by as much as half for this winter season and the upcoming summer season.

Sunrise Resorts & Cruises regional director of sales and marketing Ramy Darwish said prices had dropped by 25 to 35 per cent, and there were even talks that tour operators from the UK and Russia – top markets for Egypt – were planning to slash capacity for charters by half for summer. “We’re trying to persuade them to just reduce it by 10 to 20 per cent.”

Domina Coral Bay Sharm el-Sheikh regional director of revenue and reservation Abdel Atty Ragab said instead of dropping rates, the hotel was trying to dangle deals such as “pay six, get seven nights”.

African Express Travel president Nasr El Din Fadl said: “We cannot destroy the market price, but we’re offering promotions such as free dinners on night cruises.” He added he was planning to make personal visits to France and Russia to convince partners that Egypt was safe.

Egypt’s new tourism minister Mounir Fakhry Abdel Nour makes his first international appearance at the country’s press conference today.

EGYPT is expected to bounce back quickly with the UK market, even causing a small percentage of clients to switch from Asia, but there still is opportunity for Asia to position itself as an alternative destination to the restive Middle East in the coming months, say tour operators.

“Sri Lanka is taking some good share from Egypt, still coming in that bit less expensive than Thailand,” observed Tamara Diethelm, Kuoni UK vice president market management & pricing, who said this could be the perfect opportunity for hoteliers in Asia with empty beds to field strong tacticals, with key partners who could promote them as good alternatives to Egypt.

“We have seen the UK traveller getting more and more resilient to destination challenges around the world. However, if alternatives are available within budget, many will choose what they perceive a ‘safer’ option and any real bounce back for Egypt is unlikely to occur in full force for some months.”

Operators said they were already seeing strong offers from hotels in Egypt and charter companies being forced to cut prices to fill their planes, which are perking the interest of bargain hunters to book. This, coupled with rising flight costs as a result of increased APD and fuel costs, will be a challenge for Asia to match in due course.

Said Diethelm: “Asia does have a genuinely unique offering, but I think it is essential to bear in mind that clients are not as loyal to destinations anymore, so it really must consider its competition on a global scale if it wants to position itself correctly for the UK market. Good tour operator partners can guide their friends in Asia on flight costs, taxes, hotel offerings in other parts of the world to help them make these comparisons.”

Chic Locations UK director David Kevan said the UK market had become “a nation of opportunist vultures” descending on troubled spots to pick on a carcass of bargains.

“Those looking for a cheap two-week beach holiday are more likely to find it in Egypt than Thailand, but for us it is a totally different client. However, where I do see an impact for us is availability issues on direct flights to the Far East. Many budget-conscious travellers to the Far East choose a carrier like Qatar Airways or Gulf Air because they’re cheaper than direct flights. These clients are now scared of even a transit in the region, so that is causing sudden availability issues on direct flights. If this continues, it will have an impact on sales.”

THE SHIFT of business into dynamic sales and sourcing will not stop and will change the way traditional tour operators source and distribute in the future, according to Hotelplan CEO, Thomas Stirnimann.

Interviewed yesterday on the impact of Kuoni’s GTA acquisition on Hotelplan, Stirnimann foresees that traditional tour operators in the future will not work with as many suppliers and retail agents as they do today. Rather, it will be about building up tighter relationships and true partnerships to win loyalty.

“Twenty years ago, you’d work with everybody, now you downsize the sheer volume of agents you work with, but you try and establish true relationships with the remaining ones by, for example, educating, training and outsourcing services to these agents. The same would apply to the relationship with suppliers.”

He said there was space for relatively smaller companies such as Hotelplan, which can build on strengths such as nimbleness and leanness—“the fast boat among the big oil tankers that are building up these days”.

However he also does not rule out going into B:B e-business by buying “probably some other candidates”.

KUONI Travel Holding has made the market sit up with its announcement last Monday that it was buying Gullivers Travel Associates (GTA) for US$705 million (TTG Asia e-Daily, March 7, 2011), with industry players interviewed at ITB – Kuoni competitors included – admiring it as a smart move by a company generally seen as conservative.

Hotelplan Suisse CEO, Thomas Stirnimann, said: “It’s not a done deal yet, they have to raise the capital and it looks a bit expensive to me, but from a strategic point of view, it’s a smart move and will give Kuoni a more balanced portfolio, with less dependency on the traditional tour operating business, which is under pressure these days. With all due respect, it is a good move.”

With the deal being subject to Travelport lenders’ consent and Kuoni shareholders approval at the AGM April 20, Rolf Schafroth, the man who will take over the responsibility of GTA once the deal goes through (Ken Esterow is understood to be going back to Travelport), in an interview with TTG Asia ITB Daily declined to discuss future expectations and earnings.

However, Schafroth stressed that this was not a story about a competitor buying another to consolidate the business and cut jobs, but about bringing two successful businesses, GTA and Kuoni Destination Management (KDM), which are still growing, to new heights.

GTA, which has been in the market for sale, “has found a good home in Kuoni because it is a business we know and have been doing ourselves, and we believe in the growth of this business and intend to further develop it”, said the CEO Destination Management and EVP Procurement & Production.

“It’s not just a change of ownership. We buy and integrate, but we don’t Kuoni-nise companies—look at the companies we bought like Asian Trails or Desert Adventures. They have their culture and values and we want to preserve them.”

He said GTA added content and skilled people. The immediate synergies would be buying power and creating a stronger value proposition to suppliers with a bigger client base and distribution.

He said the GTA brand and the Kuoni brand would remain but it was too premature to say how other brands of GTA and Kuoni, such as Kuoni Connect, would fall in line following the integration.