Two headlines from the recently held Caribbean Tourism Organisation’s Leadership Strategy Conference leapt out and grabbed my attention; the first – You Have To Chase Money, Not Arrivals – attributed to David Redekop of the Conference Board of Canada, the second from an unnamed “specialist” who advised “the region should therefore focus-shift marketing from the all-inclusive traveller to the higher-revenue independent traveller”.
Both, in my opinion, make absolute sense from a Barbadian tourism perspective.
Just over ten years ago, I sat on a Ministry of Tourism-convened committee made up of private and public sector persons looking at ways that the small hotel sector on Barbados could be improved.
During that time, one of the ideas I conceptualised was a project entitled 10/10.
We then had around 120 registered small properties. We used the Caribbean Hotel and Tourism Association definition of a small hotel as being 75 rooms or less.
But from a Barbadian perspective, if you add the total room stock of this sub-sector and then divide by the number of properties, the typical size is just 22 rooms.
Our hotels generally achieve an average overall annual occupancy rate of around 50 per cent.
The plan behind 10/10 was to increase that to 60 per cent and to raise every occupied room rate by US$10 per night.
This would have been achieved by the use of creative marketing together with systematic reduction of bookings generated by tour operators and to a lesser extent, travel agents.
This would not have been a dramatic change because, typically, small hotels are not a high priority for these travel-distribution channels for all sorts of reasons.
If the objective was met, it would increase, across the board, every participating property’s yearly turnover by 32 per cent and clearly impact on profitability, allowing at least some of those hotels to upgrade and reposition.
Even based on an average room rate of US$100, the US$10 increase would have generated another $30 million annually into the economy and $2.25 million in VAT for Government.
That was, of course, just the accommodation revenue. Based on an average seven-night stay, it would also produce another 27 000-plus long-stay visitors each year with all the spending they would bring to our restaurants, car-rental agencies, attractions, activities and shopping.
Bear in mind that this concept was conceived prior to the explosion in the use of social media, so if anything, the plan now has a higher probability of success.
Sadly, the 10/10 plan was never adopted or implemented nationally.
Our little hotel did apply the concept, enabling us to achieve way beyond the projected occupancy level for ten consecutive years.
The additional revenue has allowed us to plough proportionately significant sums annually into improving the quality of the plant even during the worst global recession in 80 years.
Currently, no portion of the Barbados Tourism Authority budget is dedicated to marketing the majority of our small hotels. The Intimate Hotel group, which does receive a Government grant, represents slightly less than half of all our registered smaller properties.
The remainder are left to flounder or succeed, almost entirely by their own efforts.