Jersey Tourism PPP – Economic Development release final proposals

The creation of a new marketing organisation for Jersey, based on a private public partnership, is possibly the single biggest change in the tourism industry for over two decades. It’s surprising therefore that the release of the final proposal document has taken place without so far a word to the industry from either of the two sponsors. You can download a copy by clicking here.

Locum Consulting were commissioned by the States of Jersey to produce a paper outlining the form that the new organisation could take and how it would function and be resourced. The process has taken a couple of years and has resulted in the production of this final report which has been endorsed by both Mike King, chief executive at Economic Development and Gerald Fletcher, chief executive of the Jersey Hospitality Association.

The new organisation will be called ‘Marketing Jersey’ and will be a non profit-making limited company, controlled by an independent board of directors and funded through the combination of a States grant and private sector finance, raised through membership fees.

Overall, I support the proposals, although I have concerns on three issues:

1) It is proposed that the Board will be made up of 11 individuals – this looks too big to me and could become turgid and incapable of taking effective decisions. A maximum of 8 board members should be the target.

2) The structure of the executive groups – why split prestige and traditional holiday markets into separate groups? The skills required to market these products are the same. Combine the two into one group otherwise the marketing manager is going to be pulled in different directions by separate group chairmen.

3) The biggest concern is funding. According to the document, the JHA have been tasked with bringing forward membership fee proposals – members need to see these proposals before agreeing to go ahead. Moreover what guarantees are there on States funding? Whilst there is a 3 year rolling deal, Treasury will presumably be looking to achieve a phased reduction in the grant provided and there will need to be safeguards in place to ensure that the total pot does not keep falling. There seems to be no guarantee of this within the proposal.

I would urge everyone directly involved or associated with our industry to download the document, digest it and give your feedback to Economic Development and the JHA – which I am sure they would be keen to receive. You can also vote in the poll to the right of this post.

Economic Development want to see the new organisation in place in time to take on 2009 marketing. But in my opinion the industry needs to make sure we have the right organisation with a secure funding structure in place before we commit to such a fundamental change.

Promiscuous online travel consumers - how do we retain their loyalty?

Comscore and Google have recently announced the results of a survey into 20,000 UK online consumers and their behaviour in purchasing travel online. The research revealed that on average:

• 20 million people in the UK used the internet to research their holiday in the first quarter of 2007
• Consumers visited 22 (yes that’s right – 22!) websites before purchasing.
• Made 12 travel related searches using a search engine.
• Took 29 days from the time of the first search to make a purchase.
• Visited the site they eventually purchased from 2.5 times, rising to 3.9 times for tour operator sites.
• 54% of shoppers started the research process with a generic term (e.g. ‘flights to jersey’) rather than a branded search term such as ‘Easyjet flights to jersey’

For me, the key issue that comes out of this research is how fickle the online shopper has become when it comes to brand. The real challenge is trying to keep consumers loyal to your brand/website during the 4 week shopping process.

For repeat customers it’s fairly straight forward. If your data capturing systems are good enough then you should be able to communicate directly via e-mail and develop your relationship on a one-to-one basis. Encouraging first time visitors to book through your site is a much tougher challenge. Google predictably responded to the survey by suggesting the key is to improve your rankings on search engines and spend more on online advertising.

The other big development in this area is the growth of meta-search sites such as travelsupermarket.com and cheapflights.co.uk. These sites operate by taking a consumer search enquiry and going off to individual travel company websites & providing a comparison of price and availability, thereby reducing the workload of the online shopper. These sites are likely to provide a greater challenge to Google as they provide a one-stop shop.

Sadly, it looks likely that brand-equity, which has never been that great in our industry, is going to become even less relevant.

October visitors down - is it a blip or a sign of harder times ahead?

A Happy New Year to everyone who follows this blog. It's good to be back after the festive season.

Now if you were to come up with a list of days of the year to bury bad news, then Christmas Eve would come pretty near the top of the list. That may be why Jersey Tourism chose that day to release October's staying visitor statistics.

After a year of generally positive figures, October saw a significant drop on the previous year. Leisure visitor volumes dropped by 7% to below 30,000 and the average length of stay also fell by 3%. As a result the increase for the year dropped to just over 1%, or 4000 additional people.

More worryingly, business visitors also fell for the first time this year (by 6%). Business visitors' revenue makes an important contribution to the tourism pot in the winter months, when leisure visitors are less inclined to travel.

So what should we read into these figures? Did the credit crunch and Northern Rock publicity affect people's willingness to take a short break in the autumn? It would appear so. The loss of low cost services operated by Thomsonfly may also have had an effect.

Is it a blip, or should we be worried about the impact of UK economic difficulties for 2008? It's impossible to predict, but my guess is that it is going to be a tough start to the year. I expect peak season sales to be sluggish until the spring and the remainder of this winter to be tough with both leisure & business visitors thinner on the ground than last year.

Jersey Tourism's TV commercial started airing on Boxing Day. Let's hope it is having the desired impact. If it is, we'll probably hear about it. If not, then the spinners will probably wait until another good day for bad-news burying comes along.