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Hotelier Middle East May 2013 WTTC Summit report
Hotelier Middle East May 2013 WTTC Summit report
Hotelier Middle East May 2013 WTTC Summit report
Hotelier Middle East May 2013 WTTC Summit report
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Hotelier Middle East May 2013 WTTC Summit report


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Guy Wilkinson was fortunate enough to attend the WTTC Summit that took place in Abu Dhabi this year. He reports on the key trends discussed at this high-level global forum, and focuses on issues of …

Guy Wilkinson was fortunate enough to attend the WTTC Summit that took place in Abu Dhabi this year. He reports on the key trends discussed at this high-level global forum, and focuses on issues of importance to the Middle East hotel sector.

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  • 1. hotelier Middle East | May 2013 | Volume 12 Issue 05 WTTC GLOBAL SUMMIT 66 His Excellency Mubarak Al Muhairi, director general, Abu Dhabi Tourism & Culture Authority opened the summit. T he arrival of the 13th World Travel and Tourism Council Global Summit in Abu Dhabi was a momentous occasion for the capital, with Abu Dhabi Tourism & Culture Authority (TCA Abu Dhabi) and Etihad Airways joining forces to host the event at Jumeirah at Etihad Towers on April 9-10. The event theme was ‘A time for Leadership’, with David Scowsill, president and CEO of the World Travel & Tourism Council (WTTC) calling on the tourism industry “to grasp the mantle of leadership in order to influence”. In his opening speech, Scowsill urged the 1000-strong delegates to “not only influence at industry level but at world level, not only within government chambers, but in boardrooms, in the media, amongst employees and within supply chains”. “Leadership is about influence,” stated Scowsill. “How do we facilitate the growth of our industry responsibly and sustainably, without destroying our planet in the process? How do we manage the growth in demand for international travel from the two billion new middle class consumers emerging from burgeoning econo- mies of China and India? How do we prepare for the next one bil- lion international travellers crossing country borders each year?” While the first day of the conference provided a broad brush overview of these issues — with the keynote speech from president Bill Clinton challenging industry leaders to take the mantle of eco- nomic responsibility with tourism as the game changer — the second day tackled the specifics behind Scow- sill’s last question. UP IN THE AIR A tripartite session entitled ‘Get- ting ready for the next one billion’ was logically split between focuses on aviation, hotels and other sector players such as cruise lines, railways and travel companies. Moderator Peter Greenburg, travel editor of CBS News, introduced the session by commenting that global airlines achieved a margin of just 1.3% in 2012. Keynote speaker James Ho- gan, CEO of Etihad Airways, quoted IATA data showing that Middle East airlines’ passenger traffic was up 10.6% in 2012, compared to 3.7% worldwide. He referred in particular to the advantages enjoyed by young Gulf airlines such as Etihad, Emir- ates and Qatar Airways, compared to the ‘legacy’ airlines of the US, Eu- rope and the Far East. “We started [Etihad] with a clean sheetofpaper.Wewerenotburdened by the legacy handcuffs, whether they be union agreements, infrastructure agreements or multi hubs,” stated Hogan. Quoting impressive figures for Etihad (73 aircraft serving 83 di- rect destinations, 90 planes on order, 10million‘guests’servedin10years), he said the airline had codeshare partnerships with 42 airlines and minority equity investments in four other carriers. Of Etihad’s 14,500 staff, 1000 were Emiratis, including an all-female call centre in Al Ain. In the lively panel session that ensued, Willie Walsh, CEO of Inter- national Airlines Group (the parent company of British Airways, Iberia and bmi) admired the advance of Dubai from the world’s 99th hub air- port in 1999 to number two in 2012, characterising the Gulf as the oppo- site to Europe, thanks to its excellent infrastructure and absence of gov- ernment restrictions. He was par- ticularly critical of European airport taxes — especially the British ‘Air Passenger Duty’ — a view that was passionately reiterated by various speakers throughout the day. “Not a single penny goes to the industry or the environment,” he We have a million guests staying every night and they are mining data like it’s a candy store” Darren Richard Huston, special report TIMEFORTRAVEL Guy Wilkinson reports from the World Travel and Tourism Council Global Summit in Abu Dhabi, where leadership, taxation, sustainability and technology ranked high on the agenda
  • 2. WTTC GLOBAL SUMMIT Hotelier Middle East | May 2013 | Volume 12 Issue 05 67 Etihad Airways CEO James Hogan. Jumeirah’s Gerald Lawless, Robert Swade with Emirates Academy’s Ron Hilvert. BurgessMendola_HME_201x132.indd 1 17/04/2013 13:00 ning to hire 90,000 new staff over the next three years to support its global expansion, with China being its largest growth market. “Our job as a brand is to make sure we have the best location in the market,” Solomons added. “We have maps of Abu Dhabi and Dubai showing where we want to be.” Arthur de Haast, chairman, Ho- telsandHospitalityGroupofJones Lang LaSalle Hotels, suggested that hotel chains should focus their expansion strategies not only on locations where there was evident hotel demand, but also where hos- pitality represented a better invest- ment than other assets. “[The brands] should be think- ing of how they can deliver returns in certain locations. Virtually all the brands could do more in focus- ing on [the needs of investors].” Darren Richard Huston, CEO of, said technology was a key to brand penetration. He ex- plained that through online book- ing, guests are able to base their lodging choices on a plethora of details. “In the age of the internet, information is being democratised to such an extent…We have a mil- stated. “A recent Pricewaterhouse- Coopers report shows that if you scrap the tax, you actually boost the economy.” Martin Craigs, CEO of the Pacif- ic Asia Travel Association, added: “To you hoteliers who think this has nothing to do with you, I would politely suggest that it has a lot to do with your beloved development pipeline, (which) will be blocked if you do not allow passengers to get to your facilities.” ROOM FOR A NIGHT The focus then turned to hotels, with a session centred on the way brands and technology are helping hotel chains grow their markets. Keynote speaker Richard Solo- mons, CEO of InterContinental Hotels Group (IHG), said: “A ho- tel brand is about an experience and that experience is delivered by people. We spend an awful lot of time looking for talent and train- ing talent.” He said IHG was plan- How could we speed up the visa process without jeopard- ising security?” Desiree Bollier, Value Retail.
  • 3. HOTELIER MIDDLE EAST | May 2013 | Volume 12 Issue 05 WTTC GLOBAL SUMMIT 68 man and CEO, Mission Hills Group. He went on to say that China would open 100 new airports by 2015 and add 120,000 km of new railway lines serving 600 cities and 50 million people in the next eight years, in a bid to reduce carbon dioxide emissions. He told the audience there would also be six new cruise ship ports in Hainan Island alone — the venue for next year’s WTTC Global Summit. Desiree Bollier, CEO of Value Retail, confirmed that the Chi- nese were the top spenders on luxury duty free goods, followed by the Russians, the GCC and Brazil. These are the people you want booking your hotels — but it’s not that simple. The session revealed that the Chinese are facing major visa lion guests staying every night and they are mining data like it’s a candy store. People can now come to Abu Dhabi and Dubai and use all the filters. They can even live different lives, as a businessman and with the family (with different filtering profiles). Brands are completely relevant now, but they can’t afford to be average — they’ve got to be the best.” HustonaddedthatiPhoneandiPadusage in Dubai and the UAE was unusually high. THE CHINA DEBATE Another session ‘Common Problems, Common Solutions’ was discussed by a panel including senior representatives of the cruise-line industry, railways, trav- el companies and others — with China emerging as a key focus. China was the source of an astonishing 83 million outbound travellers in 2012, who spent $100 million on their travels and will increase in numbers to 200 mil- lion by 2020, according to Ken Chu, chair- “The conference was a great success. I enjoyed the networking and the sessions. Interesting development in integrating social media into the heart of the event – sets the standard for conferences.” Alex Kyriakidis, president and managing director, Middle East & Africa Continent, Marriott International, applauded the live Twitter feed on stage during the conference. “Visas and excessive taxation are major hurdles to growth. Martin Craigs, Willie Walsh and James Hogan all agreed and we, through Bench Events, will bang the drum, alongside our industry partners, to lobby governments to lighten regulation and reduce tax which will facilitate economic growth and employment.” Jonathan Worsley, chairman — Bench Events, pledged to continue to champion the messages raised at WTTC. “I think this is one of the finest tourism events that I’ve attended in my life, and I’ve attended several. The quality of the speeches… the content, the manner in which they communicate, I think it’s terrific. I feel there is just one lack — of speeches from the emerging economies — where is the guy from India, from Brazil?” Gautam Sen Gupta, partner, Market Vision Research & Consulting Ser- vices, sought more involvement from BRIC industry experts. “The conference has been an excellent gathering. What we see here is the movers,theshakersandthosethatareactuallygoingtoimplementthestrat- egy. And so from our perspective, it’s a perfect networking opportunity to talk about… our race of zeppelins and air ships around the earth. There is a confluence here of people who are very much pro-green… and at the same time looking to promote their cultures, their destinations, so this is a perfect context for this kind of conversation. Don Hartsell, commissioner and MD, World Air League, looks to balance the conflict of airlift and sustainability. “The World Travel & Tourism Council has done a magnificent job in staging a major event like this in a place like Abu Dhabi, above all because it is a new global destination that embodies what the future holds, today. The event has caused us all to reflect on the possible consequences of this rapid growth of tourism worldwide for the earth, and for the survival and sustainability of its humanity itself. The forum has set out a path for the tourism industry in terms of raising consumers’ consciousness about the need to change certain con- sumption patterns in order to conserve the earth. This seemed to me to be a very good outcome.” Francisco Alonso, Mexican Ambassador in the UAE. What the delegates said 4.4%Growth of travel and tourism GDP on average per year US$10.5 trillion dollars Total economic contribu- tion of travel and tourism to GDP by 2023 1000Delegatesattended WTTCAbuDhabi 70million Jobs to be in tourism by 2023 STATATTACK 10.3mnPassengerscarried byEtihadAirways in2012 Jobstobeintraveland tourismby2023 1in10 Number1WTTC forecasts that China will overtake the United States as the world’s largest travel and tourism economy by 2023 WTTC’s David Scowsill speaking at the event. Former US president Bill Clinton at the summit. Weareinacrisison everylevel–aneco- nomiccrisis,aclimatecrisis, anoverpopulationcrisis,an extinctioncrisis,awatercrisis, anoceanacidificationcrisis” Darryl Hannah, actress and activist.
  • 4. HOTELIER MIDDLE EAST | May 2013 | Volume 12 Issue 05 WTTC GLOBAL SUMMIT 70 Everything that’s good for your coffee business Schaerer has the world’s largest selection of fully automatic coffee machines and technologies for milk preparation. Along with numerous optional accessories and systems, they are the foundation for truly individual coffee machine configurations, Schaerer Coffee ArtSchaerer Coffee VitoSchaerer Coffee PrimeSchaerer Coffee Joy The first choice for connoisseurs and accountants Schaerer Coffee Prime be it for restaurants, vending facilities, takeaways, coffee shops, quick-service restaurants, hotels, chain restaurants, convenience stores, offices, cafés, universities, bistros, hospitals, bars, sports centres, cultural events ... Schaerer Ltd. for India, Middle East and Africa: Please contact our regional office in Dubai on +971 50 5512266 or’sDarrenRichardHuston discussedtheroleoftechnologyintourism. Martin Craigs, chief executive officer at Pacific Asia Travel Association. out the event. Again, it linked the overall theme of leadership, with the industry urged to work togeth- er to drive change. Finally, no travel industry confer- ence would be complete without addressing the increasingly signifi- cant impact of technology on the tourism industry. Carroll Rheem, senior director, research of PhoCusWright, said in a panel on the topic that 80% of US and European travellers use the in- ternet to shop for travel. Lee McCabe, global head of travel from Facebook, said that 10% of online travel spend in 2014 will come from mobile devices, and that already 25% of mobile usage is on Facebook and Instagram. “[The Facebook] platform is built on the influence of friends and we’re finding that in travel, that’s always been the most power- ful influence.” McCabe showed a video about how the MGM hotels in Las Vegas were using Facebook to turn guests into ‘our ambassa- dors, our marketers’, with returns of between three and 15 times on their advertising spend through the website. Other panelists demonstrated impressive new mobile technology for a language ‘phrase book’ plat- form and virtual tours of hotels. Charles Armstrong, CEO of Tour- Wrist, showed how he could use his iPad to give a ‘next generation’ virtual hotel tour, moving it up and down as though it were truly a win- dow onto a hotel lobby, and also demonstrating how his software can allow such images to be shot by guests from an iPhone. He commented: “We’re sharing photos, words, experiences, tweets on Facebook, Instagram, Twitter and Youtube. This is marketing gold, this is the best endorsement a travel brand could have.” restrictions, with just 6% of last year’s outbound total able to visit Europe and just 1.25% the US, ac- cording to Chu. Bollier echoed the sentiments of many in the forum when she complained that govern- ment visa restrictions for many nationalities was impacting tourist flows around the world. “The cost of the visa… the length it takes, you are almost saying ‘you are not welcome to come.’ On the one hand, you are saying that the tourism industry is an economic saviour of the planet, and on the other, there is no joined-up think- ing by the government bodies to say, well, let’s do something about it collectively,” said Bollier. “How could we speed up the process without jeopardising security?” TECH IT FURTHER Sustainability was a major focus for the conference, not only in the session entitled ‘Scarce Resources: Numerous Answers,’ but through-