Grow Tourism in Cyprus by Focusing on Quality, Value and Longer Seasons
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Cyprus' economy depends on tourism and holidays, but volumes and values are falling. This presentation summarises the problems with tourism and holidays in Cyprus and recommends strategies to get visitor numbers growing and grow the adventure and discovery holiday sectors.
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Grow Tourism in Cyprus by Focusing on Quality, Value and Longer Seasons
- 1. GROWING TOURISM IN CYPRUS TOURISM HAS CHANGED. SO MUST CYPRUS © Mike McCormac 2011
- 2. INTRODUCTION • Summary • Contents • The old days aren’t coming back • Situation • A new approach is needed • Opportunities • That’s based on today’s market • Strategies realities • Appendices • This is an analysis of: • The facts • The opportunity • What needs to happen © Mike McCormac 2011
- 3. TOURISM HAS CHANGED. SO MUST CYPRUS SITUATION © Mike McCormac 2011
- 4. 10 YEARS OF DECLINING TOURIST NUMBERS • Actual tourist numbers to 3,000 Cyprus have fallen 33% 2,500 between 2000 and 20101 Numbers of visitors on holiday (,000) 2,000 • Worldwide tourism has grown c.25% in the same 1,500 period2 1,000 • That means in market terms Cyprus tourism has fallen 500 47% in the last ten years 0 © Mike McCormac 2011
- 5. 10 YEARS OF DECLINING TOURISM REVENUE • Actual tourist revenue in 2000 Cyprus has fallen 24% between 2000 and 20101 1500 • In the same period inflation Tourism Revenue (€m) in Cyprus has been 30%1 1000 • That means in real terms Cyprus tourist revenue has 500 fallen 44% in the last ten years 0 © Mike McCormac 2011
- 6. PACKAGES DECLINE, INDIVIDUAL TRAVEL GROWS • In the period 2001 to 2010: 80% • Package holidays declined from 70% 75% to 54% of the total 60% • Individual travel grew from 25% 50% Perentage of total to 46% of the total 40% 30% 20% 10% 0% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 © Mike McCormac 2011
- 7. DECLINE IN SELF PACKAGING • Self packaging has peaked • Factors: • Customers don’t have time • 30% increase in the importance to organise it themselves of comfort • 40% increase in the importance • They want their holiday to of security (bonded tour be easy operator) • 40% increase in the importance of destination knowledge © Mike McCormac 2011
- 8. UK REMAINS THE PRIMARY SOURCE • Between 2000 and 2010: 2000 2010 • UK visitors have declined from UK 64% 58% 64% to 58% Germany 11% 8% • German visitors have declined Greece 5% 7% from 11% to 8% Switzerland 4% 2% • Russian visitors have increased Norway 3% 4% from 6% to 13% Russia 6% 13% Sweden 6% 6% France 2% 2% © Mike McCormac 2011
- 9. PERCEPTIONS OF CYPRUS • Negative • Positive • Expensive • Weather • Poor quality • Sea • Downmarket • Countryside • Rip off Cyprus • English speaking • Untidy • Weddings © Mike McCormac 2011
- 10. IMPACT OF SOCIAL MEDIA • Quotes from Total Media Social Travel Report: • “Almost 70% of consumers use the internet to book their holidays, compared to 23% by phone and just 8% with travel agents” • “Consumers aged 35-44 were found to be most likely (74%) to book online” • “Price (80%) was cited as the main reason for using the internet along with information (53%) and convenience (50%)” • “Online reviews from the likes of TripAdvisor are now more influential than brochures, advertising, travel supplements and agents” • “People trust complete strangers over recommendations from the travel industry” • “The holiday industry is facing a social media revolution” © Mike McCormac 2011
- 11. WORLD’S TOP 10 WEB SITES IN ORDER • The web today is about • Google social networking • Facebook • Static websites are not good • YouTube enough • Yahoo • People browsing the web • Blogger want to be involved • Baidu • User reviews like Tripadvisor • Windows Live are trusted more than • Wikipedia commercial sites • Twitter • QQ.com © Mike McCormac 2011
- 12. WHY SOCIAL MEDIA CANNOT BE IGNORED • Facebook • More than 500 million users. More popular than Google in USA • YouTube • Over 500 million visits every month. 92 billion page views each month • Twitter • 200 million users. 110 million tweets daily © Mike McCormac 2011
- 13. IMPACT OF TRIPADVISOR • One in three UK holidaymakers use Tripadvisor for information. • Of those, one third change their plans as a result • Tripadvisor consistent Cyprus themes: • ‘Expensive’ • ‘Rip off’ • ‘Scams’ • ‘Ghost town’ © Mike McCormac 2011
- 14. IMPACT OF ALL INCLUSIVE • Major tour operators seeking to increase their share of revenue • Trend to all inclusive will reduce revenue in Cyprus and damage tertiary businesses © Mike McCormac 2011
- 15. WEDDINGS HAVE BEEN A SUCCESS STORY • 1 in 4 UK couples now marry • Cyprus is in the top ten of abroad destinations for UK • 27% increase in British weddings abroad couples marrying abroad • But indications are Cyprus’ between 2005 and 20102 share is slipping • Up from 45,000 in 2005 to just over 57,000 in 2010 © Mike McCormac 2011
- 16. CYPRUS TOURISM ORGANISATION • Underfunded • 20% budget reduction in 2011 • High costs • High administration costs as a percentage of budget • Cost base growing • Needs • Budget growth • Administration and operating cost reduction © Mike McCormac 2011
- 17. IMPLEMENTATION MATTERS • Example – golf • Why do Elea and Secret Valley work? • Focus on quality activity product • Why do Secret Valley and Minthis Hills/Tsada fail? • Focus on property development • Activity product secondary © Mike McCormac 2011
- 18. CONCLUSIONS • Radical action needs to be taken to reposition and promote the Cyprus’ tourism product because: • Today’s customers want more than sun, sea and sand • Volumes and revenues will continue to decline • Traditional packaged holidays will decline faster • Despite optimism about Russia, the UK remains the primary market • Cyprus’ current tourism product is expensive and sub-standard • The internet is the primary means to research and book holidays • ‘All inclusive’ will further damage local businesses • Weddings have been a success story but quality needs to improve • Independent travel is a growing opportunity © Mike McCormac 2011
- 19. TOURISM HAS CHANGED. SO MUST CYPRUS OPPORTUNITIES © Mike McCormac 2011
- 20. BACK TO BASICS • What are Cyprus’ assets? • What are Cyprus’ liabilities? • Weather • Perceptions: • Sea • High cost • Mountains • ‘Rip off’ • Long season • Down market • Open access to countryside • Beaches not as good as competing destinations • Long flight • Untidy © Mike McCormac 2011
- 21. LENGTHEN THE SEASON • Cyprus’ climate makes a long Visitors by Month (%) season possible 16% 14% • Shoulder months are a 12% growth opportunity 10% • March, April 8% • October, November 6% 4% 2% 0% Feb Nov Dec Apr Sep Aug Mar May Oct Jul Jun Jan 2009 2010 © Mike McCormac 2011
- 22. FASTEST GROWING SECTORS • Top five growth sectors. Environmentally friendly Three fit Cyprus’ strengths • Environmentally friendly holiday Adventure holiday • Adventure holiday • Nature and wildlife holiday Nature and wildlife holiday • Discovery holiday • Special interest holiday Discovery holiday Special interest holiday 0% 100% 200% 300% © Mike McCormac 2011
- 23. ADVENTURE HOLIDAYS • The Adventure Travel Trade Association defines adventure travel as: • Any tourist activity including two of the following three components: • A physical activity • A cultural exchange • Interaction or engagement with nature © Mike McCormac 2011
- 24. ADVENTURE TRAVEL INCLUDES • Special interest • Active adventure • Culture • Mountaineering • Nature • Off road cycling • Wildlife – especially bird watching • Sailing • Walking and hiking • Water sports • Cycling • Diving • Mind, body, spirit – and health • Off road driving • Photography • Horse riding • Wine/vineyard • Pottery © Mike McCormac 2011
- 25. UK OVERSEAS ADVENTURE TRAVEL MARKET4 • Statistics • Largest operators • 400,000 passengers a year • Tour operators take 50% of the • £180m per annum market • The Adventure Company (TUI) • Forecast to grow 70% over next three years • Explore • Average spend increased 21% • Exodus (TUI) from £987 in 2006 to £1,198 in • Geckos 2009 • Headwater • … © Mike McCormac 2011
- 26. WHO TAKES ADVENTURE HOLIDAYS? • Demographic groups: • Typical customer profile: • Younger people in the 16-34 age • Confident, well travelled group consumers wanting more than • Single professionals, especially sun, sea and sand females • Demanding an authentic ‘off the • Affluent active families beaten track’ experience • Inquisitive 50+ males and • Active females © Mike McCormac 2011
- 27. CTO SPECIAL INTEREST TOURISM INCLUDES… • Rural tourism • Religious tourism • Agrotourism • Nature tourism • Nautical tourism • Nature trails • Marinas, beaches, cruises • Sports tourism • Casinos • Football, cycling, golf • Cultural tourism • Health • Cultural and artistic events • Conference and incentive • Wine Routes • Weddings and honeymoons © Mike McCormac 2011
- 28. EACH ACTIVITY IS A SMALL MARKET OPPORTUNITY • Some solutions • For example • Group similar activities • A week’s activities including • Run activities to a calendar mountain biking, climbing and hiking • A week’s activities staying in an Agrotourism location and exploring vineyards © Mike McCormac 2011
- 29. SUMMARY OF OPPORTUNITIES • Cyprus is potentially a year round destination – for the right sort of holidays • Cyprus can be positioned for: • Adventure holidays • Nature and wildlife holidays • Special interest holidays • The market for these opportunities is growing © Mike McCormac 2011
- 30. TOURISM HAS CHANGED. SO MUST CYPRUS STRATEGIES © Mike McCormac 2011
- 31. TWO CORE STRATEGIES FOR CHANGE • Communication • Update communication and promotion channels to fully capitalise on the internet/social media opportunity • Focus on the growth adventure sectors • Reposition from ‘Love Cyprus’ to ‘Fun Cyprus’ • Review the infrastructure • Active promotion © Mike McCormac 2011
- 32. PLUG THE HOLE IN THE ADVERTISING BUCKET • Customers believe social media • Advertising investment is being negated by the social media effect • It’s like a big hole in the bottom of the promotion bucket © Mike McCormac 2011
- 33. COMMUNICATION IS THE FIRST THING TO CHANGE • Communicate differently: • With better information: • The target market is highly • Customers want lively, engaging internet aware information • Facebook • Create a virtual ‘try before you • Twitter buy’ using: • Forums • Videos • Live chat • Google Earth • Decrease conference spend, • Customer testimonials and increase internet spend photos © Mike McCormac 2011
- 34. ADVENTURE HOLIDAY REQUIREMENTS • Access to the countryside or coastline • Facilities for the activity • Activity providers such as accredited activity operators, outdoor education centres, schools and freelance instructors • Accommodation catering for the needs of participants • Simple, visible booking services for lessons, courses and taster sessions © Mike McCormac 2011
- 35. INFORMATION REQUIREMENTS • The Internet is the primary source of information for adventure activity takers • Participants want pre-visit activity information • Some people can be influenced by at-destination information on local activity providers • Sports governing bodies and associations are a key source of information for participants • Some activities will require pre-visit and at-destination information including: • Access and parking arrangements • Equipment hire, repair and sales • Times, charges, contact information © Mike McCormac 2011
- 36. DESTINATION MANAGEMENT OPPORTUNITIES • Development of specific activity focussed marketing • Coverage of adventure activities on websites with specific information • Key marketing messages: trying out, learning, or pursuing an adventure sport • Encouraging and supporting the development of: • Local networks of operators to provide a basis for networking and business referrals • Collaborative marketing initiatives • Promotion of environmental and quality messages to operators • Business support and training into the sector • Facilitating local adventure activities information services • Creating local booking services for adventure activity courses and sessions • Promotion of appropriate adventure sports events and competitions © Mike McCormac 2011
- 37. ACCOMMODATION OPPORTUNITIES • Development of activity specific accommodation • Differentiation by providing activity specific facilities • Providing local information • Target individuals looking for activities in specialist magazines • Develop working relationships with local activity operators © Mike McCormac 2011
- 38. SUMMARY OF STRATEGIES REQUIRED • Move the message from ‘sun’ to ‘sun and fun’ • Need a big focus on the internet –content and social media • Analyse the special interest sub-sectors to get best fit between: • Current volume • Potential, growth • Cyprus’ attributes • Work on improving product quality in the target sub-sectors © Mike McCormac 2011
- 39. ABOUT THE AUTHOR • Mike McCormac is a sales and marketing consultant specialising in the travel and tourism sector and living in Cyprus. • Contact Mike at: • +357 99 860725 • mike.mccormac@hotmail.co.uk • www.salessuccessandmore.com © Mike McCormac 2011
- 40. APPENDICES © Mike McCormac 2011
- 41. SOURCES • 1: Republic of Cyprus Statistical Service • 2: Mintel • 3: Total Media Social Travel Report • 4: YouGov © Mike McCormac 2011