Having just returned from Puerto Rico, where I attended the Caribbean Hotel & Tourism Assosication (CHTA) – the second annual Caribbean Hotel Industry Exchange Forum (CHIEF for short) – I am moved to share my concerns about the region, its people, who are dear to my heart, and dealing with some real challenges.
The conference appeared to be in jeopardy as Tropical Storm Matthew was forming in the Atlantic and moving west. In just 24 hours it went from a depression to a full-blown hurricane. Thankfully it moved south and skirted past Puerto Rico, but not before a glancing blow at the islands of Barbados and St. Lucia, a feint jab at the Netherland Antilles, then a hard right-hand turn towards Jamaica, Haiti, Cuba, Turks & Caicos and the Bahamas. By the time you read this, you will know how well each country fared and, crossing our collective fingers, that all will be well.
A major topic during the conference was about marketing the region as a whole. The Caribbean as a destination is a collection of over 30 different, wonderfully unique islands and countries. According to MMGY’s Portrait of American Travelers® study, the Caribbean as a destination is second only to Europe as a place where Americans are “very or extremely interested” in visiting in the next two years. More than 44 percent are interested in going, which is great news.
However, according to the CHTA, due to the Zika virus, the outcome of Brexit, fear of global terrorism, high airfares, and ineffective marketing initiatives, key metrics surrounding ADR, RevPAR and occupancy are all projected to decrease. The Caribbean is the number one most tourism-dependent region in the world, yet it has seen its market share continue to decline from a high of 5 percent in the ‘80s and ‘90s, to a projected 1.7 percent in 2020.
Travelers have a strong desire to visit the region, and the tourism infrastructure is first rate. But destination marketers have to do a better job of turning desire into action.There are over 30 countries that make up the Caribbean, and despite rhetoric to the contrary, most of them pursue their own self-interest when it comes to marketing. “The countries need to come together and promote, as a whole, what the region has to offer. Whether that is through a bed or arrivals tax, or another revenue-generating instrument.”
But here’s the rub: most of the countries are saddled with high unemployment, high debt, and low credit ratings. Consequently, the politicians on each island – who all have to face re-election at some point – are loath to tax their own guests and visitors, and then see those funds distributed to some collective marketing fund rather than using it to improve their own situation.
Organizations like CHTA and CTO (Caribbean Tourism Organization) must convince private sector stakeholders – hospitality companies, OTAs, airlines, cruise lines, etc. – to contribute dollars to an evergreen marketing fund to launch and sustain a well-conceived marketing campaign. It has worked before. In 1993 CTO launched the Beach Boys “Kokomo” campaign, and then again in 2003 the “Life Needs the Caribbean” campaign resulted in significant lift in share of international American travelers. But these were short-term initiatives that were fueled primarily by capital injections from suppliers such as American Airlines, American Express, Visa and others, all of which seem to have different priorities now. And while those spikes in arrivals are good, they are unsustainable without an ongoing campaign to raise awareness, drive demand and conversions.
The tools we have now are infinitely more sophisticated and accurate than were available in the earlier campaigns. Digital targeting, retargeting, programmatic media buying, social media and conversion attribution modeling allows us to reach the right people, at the right time in the right context. And the evolution of technology surrounding crowdfunding, digital forms of payment and online banking make it possible to allow private sector suppliers to contribute in real time to a regional marketing fund based on real ROI.
This won’t just magically happen on its own. I applaud the efforts of visionaries like Frank Comito, Karolin Troubetzkoy, Matt Cooper, Richard Doumeng and Hugh Riley who are working to develop the strategic direction to bring all the players together to make this a reality.