Kuoni’s Divestiture of Tour Operator Units Nears Completion
The final chapter in the number one story of the year for the global tour operator industry—the divestiture by Zurich-based Kuoni of its tour operator businesses—is nearing completion with the just-announced selloff of Kuoni’s operations in India to Thomas Cook India. Two months ago, the Cologne-headquartered Rewe Group, which owns DER Touristik, acquired Kuoni UK together with Kuoni tour operations in Switzerland, Scandinavia and the Benelux region. (These actions follow the 2013 decision by Kuoni to sell off branded units, as well, in Italy, Spain, The Netherlands, Belgium and Russia.)
With the acquisition, Thomas Cook India is expanding its penetration in the travel business in the world’s second most populous country and the Number 9 overseas source market for the USA (it generated more than 960,000 USA visitors last year) by buying a 100 percent stake in one-time rival Kuoni group’s travel business in India and Hong Kong for 5.35 billion rupees ($84 million). Thomas Cook will take all the 1,800 employees of Kuoni’s travel business unit and run it as an “independent entity.” Already, Thomas Cook India is present in over 232 locations across India, Mauritius and Sri Lanka.
In an Aug. 7 notice to stock exchanges, Thomas Cook India said the deal would be financed through a mix of funds from earlier “equity infusion, internal accruals, debt funds (for Hong Kong) and or other permissible modes.” The expansion of Thomas Cook India is not exactly a surprise to those who have followed the travel trade in India in recent years. Fairfax Financial Holdings, the Toronto-based financial services holding company, is the controlling shareholder of the company, which had originally acquired 77 per cent in Thomas Cook India from its UK-based parent for $171 million in 2012. Prem Watsa, chairman and CEO of Fairfax Holdings, is the controlling shareholder of Thomas Cook India.
The year began with Kuoni’s announcement that, as part of a strategic review, it would focus on its core business as a service provider to the global travel industry and governments and exit the tour operating businesses in Hong Kong/China, India, Scandinavia, Finland, the Benelux and the UK.
Sören Hartmann, the chief executive of DER Touristik, has said that the full integration of the Kuoni units—it includes nearly 40 locations in the UK alone—will take two to three years.
New International Air Service This Month: A new feature of the INBOUND Report
| Carrier | From | To | Date | Comments/Aircraft/Frequency |
|---|---|---|---|---|
| Air Canada | Montreal, QC | Lyon, France | 6/16/2016 | Airbus A330-300; 5x weekly |
| Air Canada | Vancouver, BC | Brisbane, Australia | 6/17/2016 | Boeing 787-8; 3x weekly |
| American Airlines | Caracas, Venezuela | New York JFK | 12/17/2015 | Boeing 757-200; 5x weekly; subject to government approval |
| WestJet | Toronto, ON | Boston, MA | Spring 2016 | WestJet Encore; Dash8-Q400; 3x daily |
| WestJet | Halifax, NS | Boston, MA | Spring 2016 | WestJet Encore; Dash8-Q400; 1 flight daily |
Posted on Aug 10, 2015
Brand USA Announces its Priority Markets for FY 2016
While a more extensive discussion by, as well as a decision by, the full board of directors of Brand USA of its marketing program for Fiscal Year 2016 will come at next month’s board meeting on Sept. 18 in Washington, D.C., the board’s marketing committee† signed off at its recent meeting on the program, as committee members sought to put into place the steps that they hope will increase the number of international visitors by a little more than another million as it strives to reach an Obama Administration goal of 100 million international visitors by 2021.
(† Brand USA Marketing Committee: Barbara Richardson, chief of staff of the Washington Metropolitan Area Transit Authority, chair; Caroline Beteta, president and CEO, Visit California; John Edman, director, Explore Minnesota; George Fertitta, CEO, Bloomberg Associates; and Randy Garfield, retired, formerly executive vice president of worldwide sales and travel operations for Disney Destinations and president of Walt Disney Travel Company.)
As illustrated in the following table, the marketing committee has opted to identify the top 14 markets (on the left) as targets for direct-to-consumer activities, while the 14 opportunity markets (on the right) will be a focus for trade-related activities. Most of the latter, explained David Whitaker, chief marketing officer, “have traditional distribution channels and active Visit USA Committees.” All totaled, the two groups comprise 39 country markets
| Established Markets | Opportunity Markets |
|---|---|
| Prioritization: Media mix may include broadcast, cinema, OOH, digital display, events, OTA media, paid search and paid social, sharing and ongoing trade emphasis | Market Prioritization: Trade Focus Visit USA programs, trade shows, road shows, missions, fam tours and/or training activities |
| Canada | Spain |
| Mexico | Hong Kong/Taiwan |
| China | Italy |
| United Kingdom | Benelux Countries |
| Brazil | South America* |
| Japan | Nordic Countries* |
| Australia | Austria |
| India | Switzerland |
| Germany | Southeast Asia* |
| South Korea | Central America* |
| France | Gulf Coast Countries |
| Sweden | South Africa |
| Colombia | Israel |
| Chile | Hungary |
Note: In left column, the first five markets generate 65 percent of international traffic to USA; the first 10 markets= 77 percent; and all 14 generate 81 percent of international traffic to USA.
* Selected countries in each region
Turnover Time: Committee members will be busy this month and next either reviewing applications from, or interviewing, agencies and firms that responded to Brand USA RFPs for a new ad agency of record (NYC-headquartered global agency, JWT, is the current agency of record); a marketing services agency; a digital agency; and a firm that will help with Brand USA’s corporate website.
The marketing committee will be meeting again next month (Sept. 9), just prior to the Sept. 18 meeting of the full Brand USA board of directors. At that time, there will be a presentation that explains in depth the marketing programs for each of the top 14 markets. All of this takes place in time for the beginning of the new fiscal year on Oct. 1, 2015.
Weirdest Item of the Week–San Francisco’s Pee Proof Paint
San Francisco Tests “Pee Proof” Paint to Curb Public Urination. Tired of the hundreds of requests its public works department receives to steam clean public areas besotted with urine deposits by those who take to relieving themselves publicly and irritated that increased fines for such activity have had no impact, San Francisco officials have begun using a “pee-proof” paint around the city to combat the problem of public urination. Crews have thus far painted 10 walls in the city with a special ultravolet-coated, urine-repellent paint. If an individual attempts to urinate on a wall coated with the super hydrophobic paint, the urine, rather than running down the wall, will spray back at the person relieving himself, potentially hitting his clothes or shoes. Public officials have made no pronouncement as to the effectiveness of the new pee-proofing campaign, which was only recently implemented.
Research—Japan Report: Visit USA Traffic Outperforms Overall Outbound
The projection of the latest report from JTB, Japan’s largest travel company, on the current summer travel season (July 15-Aug. 31) estimates that it will send 222,000 Japanese travelers to visit Mainland North America (USA)—an increase of a mere half-percent increase over 2014. Even so, this looks good compared to the most recent forecast of the U.S. National Travel and Tourism Office (NTTO), which has predicted a 3 percent decline in Japanese visitors to the USA in 2015 vs. 2014. The same NTTO forecast calls for a zero percent change in arrivals in 2016.
The half percent increase looks even better when one threads through the JTB report and sees estimates of large drop-offs in outbound travel to most global regions. The modest increase in traffic to North America is due to a weaker Yen vs. the U.S. dollar, additional lift capacity to North America and some holiday combinations that create “silver weeks” later this year. Some other projections:
Major Japanese Operators
Package Sales Targets for North America
First Half of 2016 (10/1/15 to 3/31/16)
& Estimated Results for 2nd Half of 2015 (4/1/15 to 9/30/15)
| Operator | Package Sales | Change vs. | Estimated Results | Change vs. |
|---|---|---|---|---|
| Target, First Half | Previous Year | 2nd Half 2015 | Previous Year | |
| 2016 | ||||
| Look JTB (JTB | 22,000 | 11% | 20,000 | 10% |
| World Vacations) | ||||
| JALPAK | 11,000 | 4% | 11,000 | 4% |
| ANA Sales | 3,500 | 15% | -- | -18% overall |
| (ANA Hallo) | ||||
| NTA | 6,500 | 25% | -- | -- |
Source: JTB
A May Snapshot: Overall, total sales volume for overseas travel purchased in May 2015 at 49 major travel companies was $1.293 billion; this was down 9.2 percent over the previous year, according to the Japan Tourism Agency, which indicated that the declining value of the Japanese Yen vs. the U.S. dollar and other currencies, along with the impact of the MERS epidemic in Korea were major causes. Other notes for May 2015
- The total amount of package sales was $409.53 million dollars (-9.3 percent vs. 2014)
- The total number of customers was 225,871 persons (down 9.6 percent vs. 2014)
- Share of JTB World Vacations, JTB Business Solutions, Travel Plaza Int’l, PTS was 36.83 percent
- Share of JTB customers in total overseas departures was in May 2015was 19.4 percent (down 0.6 percent vs. 2014)
- Share of the top ten companies (listed below) of the top 49 for May 2015 was 82.4 percent.
May 2015 Total Sales
Top 20 Travel Companies in Japan
| Company & Rank | Sales Volume (in millions) | Growth ratio |
|---|---|---|
| 1. JTB Group 15 companies | $269.63 | -6.60% |
| 2. H. I. S. | $208.19 | 1.50% |
| 3. Hankyu Express 3 companies | $143.98 | -27.30% |
| 4. JTB World Vacations | $133.91 | -8.70% |
| 5. KNT Holdings 8 companies | $94.43 | -12.40% |
| 6. Nippon Travel Agency | $84.41 | -15.80% |
| 7. JTB Business Solutions | $38.29 | -2.40% |
| 8. JALPAK | $36.25 | -10.80% |
| 9. Travel Plaza Intl (JTB) | $28.39 | -8.80% |
| 10. Nissin Air Service | $27.96 | -7.20% |
| 11. Air Link | $27.56 | 35.20% |
| 12. Nippon Express | $27.20 | -1.40% |
| 13. M. O. Tourist | $24.65 | -12.00% |
| 14. Tobu Toptours | $23.58 | -3.40% |
| 15. Yusen Travel | $20.08 | 1.80% |
| 16. NOE | $18.11 | -3.80% |
| 17. ANA Sales | $14.15 | -20.70% |
| 18. Hitachi Travel | $12.72 | -5.40% |
| 19. Nishitetsu Travel | $10.35 | -14.70% |
| 20. Rakuten Travel | $10.12 | 0.50% |
Source: Japan Tourism Agency
Summary provided courtesy of Ko Ueno, Chairman of the Japan Tour Operators Association
USA Has 14 Of World’s Top 25 Attractions: (Orlando has 8)
Online travel site TripAdvisor has released its list of top attractions as part of its Travelers’ Choice 2015 awards, drawing from 533 major attractions in Asia, Canada, Europe, India, South America, the South Pacific and the United States. Orlando-based attractions/theme parks took five of the first six places on the list. Universal Islands of Adventure placed first, with Discovery Cove and Magic Kingdom taking the second and third places respectively.The annual awards are based on millions of traveler comments and opinions from the TripAdvisor website, which uses an algorithm to decipher the best amusement and water parks, zoos and aquariums.
World’s Top 25 Theme Park Attractions
| Theme Park and Rank | Location |
|---|---|
| 1. Universals Islands of Adventure | Orlando, Fla. |
| 2.(SeaWorld) Discovery Cove | Orlando, Fla. |
| 2. (Disneys) Magic Kingdom | Orlando, Fla. |
| 4. Universal Studios Hollywood | Los Angeles, Calif. |
| 5. Disneys Hollywood Studios | Orlando, Fla. |
| 6. Universal Studios Florida | Orlando, Fla. |
| 7. Europa-Park | Rust, Germany |
| 8. Disneyland Park | Anaheim, Calif. |
| 9. Beto Carrero World | Penha Brazil |
| 10. Port Aventura Park | Salou, Spain |
| 11. Disneys Animal Kingdom | Orlando, Fla. |
| 12. Tivoli Gardens | Copenhagen, Denmark |
| 13. Disneyland Park | Marne-la-Vallee, France |
| 14. Cedar Park Amusement Park | Sandusky, Ohio |
| 15. SeaWorld Orlando | Orlando, Fla. |
| 16. Epcot | Orlando, Fla. |
| 17. Busch Gardens | Tampa, Fla. |
| 18. Universal StudiosSingapore | Sentosa Island, Singapore |
| 19. Dollywood | Pigeon Forge, Tenn. |
| 20. Gardaland Park | Castelnuovo del Garda, Italy |
| 21. Disney California Adventure Park | Anaheim, Calif. |
| 22. Six Flags Magic Mountain | Los Angeles, Calif. |
| 23. Ocean Park | Hong Kong, China |
| 24. Silver Dollar City | Branson, Mo. |
| 25. Walt Disney Studios Park | Marne-la-Vallee, France |
Source: TripAdvisor
How I Got My Start in the Travel Trade
“How I Got My Start” is a regular segment in which we cull a couple of selections from our interviews with international operators, domestic operators, receptive operators, destinations, hotels and attractions to explore the path that led one to a career in the travel trade industry. One thing we have learned: the road to where they are is almost never the same. In this issue, we feature: Dan Gleason, director of sales/agritours Illinois, Quad Cities Convention & Visitors Bureau; and Donna Marcou-Stafford, vice president of leisure sales, Tropicana Las Vegas.\
Dan Gleason: The way I got my start in the travel trade industry is that I kind of just fell into it. For my Bachelor’s Degree I had to have an internship and the Quad Cities CVB had one open. Eight years later, I am still there and loving every minute of it. Falling into the travel trade industry was the best fall I have ever taken. And it didn’t even hurt!
Donna Marcou-Stafford: I used to travel a lot with my family when I was a little girl—Orlando, California, Hawaii and even Las Vegas for family vacations….so I picked up the travel bug at a young age. I also said I wanted to be that friendly pretty girl that checked us into the hotel when I grew up! Hence, I became a desk clerk” in my first job! I also was a Concierge, worked in Food & Beverage and Catering Special Events. I then discovered the job of a Sales person and worked my way up to that job. I still love it for over 25 years now!
HODGE PODGE—Shifts, Shakeups and Occasional Shaftings in the Tour and Travel Industry
Sue Arko, the now semi-retired founder of Free Spirit Vacations and Events, which is based in Gilbert, Ariz., has announced the hiring of a new general manager for the company: Tish Losure. A 30-year veteran of the tour and travel industry, Losure began her career in the hotel sector, working as a national director of tour and travel for major hotel chains, including Baymont Inns, La Quinta and Red Lion. Losure later moved to the tour operator side of the industry, serving at New Horizons Tour and Travel and LEAD USA. (Photos: Arko, top, and Losure)
Long-time hospitality industry veteran Tony Chawla has been let go as a result of a restructuring within IHG. Chawla had been with IHG for more than 15 years, first as a regional director of international sales for several years in San Francisco and, since September 2003, as a key account director in Los Angeles. Prior to his tenure with IHG, Chawla had served as director of sales for the Holiday Inn in Hollywood and, later, as general manager of the Holiday Inn Hollywood Walk of Fame. He began his career in 1976 with the Hotelfschule brand in Europe.
The UK group tour specialist On The Go Tours has appointed Carl Cross as managing director of its global operations. He joins from Flight Centre UK where he was general manager retail product, marketing and consumer experience. Cross will split his time between offices in Australia and the UK, as well as in Canada, South Africa and New Zealand. His appointment follows the departure of general manager Pru Goudie, who has left after two tours of duty with the operator totaling 12 years.
Online booking service HotelPlanner is moving to larger headquarters within West Palm Beach, Fla., say co-founder and CEO is Tim Hentschel—he is the son of Noel Irwin-Hentschel, founder and chair of AmericanTours International—and fellow co founder and CIO John Prince. The move to larger facilities is intended to accommodate a 167 percent increase in the number of its staff, from 45 to 120, over the next five years. All totaled, the company has about 90 workers across its offices in Florida, Las Vegas, London and Hong Kong. The move to the new 15,000-square foot space at the PNC Bank Building on Datura Street in West Palm Beach is expected to take place Dec. 1. (Photos: Hentschel, top, and Prince)
Ben Roseveare has joined London-based Mark Warner Holidays as the company’s new head of sales and marketing. Roseverare joins Mark Warner from his previous role as marketing director at Intrepid Group. He was also previously sales and marketing director at Exodus Travels. He brings with him 15 years’ experience running sales and marketing teams in the active and adventure holiday sector.
The Springfield [Illinois] CVB has named Gina Gemberling executive director after she had served in the post in an acting role for the past 16 months. In addition to acting director, Gemberling—she has been with the CVB bureau since 1992—has served as a sales manager, a services manager and the director of sales and marketing for the bureau. She succeeds Fred Puglia, who retired from the position in early 2014.
Cori Day, director of tourism for the city of Independence, Mo. is leaving the post after four years to join Visit KC, where she has been named vice president of sales and services for the organization. Her first day at her new assignment will be Aug. 31. Before her tenure at Independence, Day served for four years as convention sales manager for the Columbia (Mo.) CVB.
