People are drawn to the Cayman Islands for any number of reasons; the sand, sea and sun, events such as Pirates Week, family vacation, culinary month, sporting events and more. But in order to attract visitors, the public at large has to first find out about what Cayman has to offer.
Three key personalities in the Cayman Islands tourism equation are the country managers. All three are charged with keeping the name of Cayman in the forefront of people’s minds when choosing a destination for pleasure or work, and thus helping the tourism money filter through the Cayman economy. They are Don McDougall, Thomas Ludington, and Paul Minich.
What are the specific issues at the moment in economic terms in driving visitors to Cayman?
Don McDougall (Europe): Challenges include increasing visitor numbers with no likely short/mid term growth in airlift capacity. Also, current air service operates as a monopoly driving non-competitive airfares and combined package rates and lack of European favoured accommodation brands. In economic terms this means that airlines are not likely to increase route capacity.
Opportunities: while the current economic climate negatively impacts on global outbound tourism, the target market for the Cayman Islands has proven to be much more resilient and demand is still high in comparative terms.
Paul Minich (Canada): From a Canadian perspective, despite global economic issues, some of our indicators are favourable to driving visitation. A strong Canadian dollar adds value for Canadians travelling south, with the Canadian dollar holding at a premium to the US dollar. (Contrast that to a few years back when the Canadian dollar was at .67 against its US counterpart.)
Although Canada is certainly impacted by global uncertainty, it was one of the last countries to slide into recession, and one of the first to show signs of recovery. Consumer confidence levels are not where they should be, but they currently trend much higher than the US.
These economic factors, combined with focussed marketing and competitive air fares have allowed us to engineer a 35 per cent year to date lift in visitation.
The one economic challenge we face is the flip side of a strong Canadian dollar-marketing funds available to promote the destination shrink in currency conversion-so while consumers enjoy more buying power heading southbound, our buying power for advertising and promotion needs to be stretched. Our lift in visitation suggests we have found the right balance.
Thomas Ludington (US): Consumer confidence is the underlying factor that has a significant impact on the US consumers’ comfort level when they are considering leisure travel. It’s at a very low point now and even with the affluent consumer, we are finding that they are buying closer in to their departure dates and may be staying shorter periods of time.
How has this changed over the last couple of years?
Don McDougall (Europe): The above conditions have been prevalent for more than two years. Such investment is a long term decision.
Paul Minich (Canada): The Canadian dollar is at a 30 per cent premium to the US dollar from a few years back which has really changed the landscape. But having said that, our target market is an affluent and discerning traveller, who keeps an eye on currency, but is not consumed by it. From this perspective I would suggest our work on properly positioning our brand, and our brand position as a cosmopolitan, aspirational destination here in Canada has paid solid dividends.
Thomas Ludington (US): With the more affluent consumer, travel is part of their DNA. However, today they are expecting much more for their dollar, which in turn is applying pressure to the average daily rates at hotel properties.
They are also looking at product such as the new higher end all inclusive resorts in destinations that were not normally considered in our competitive set. The Department of Tourism therefore works closely with the private sector to develop promotions that can add value to the vacation, and we also aim to combine this with any air fare promotions that may be in the market.
What particular country/territory-specific considerations are there in your day to day work?
Don McDougall (Europe): Languages are a huge challenge when the region of 40-plus countries has such cultural diversity.
The cost of running a business to consumer advertising campaign is almost the same no matter what country one is focusing on, so with the limited budgets available (in relative terms compared to major consumer goods/service brands,) the department can only afford paid for activity in one source market and only for approximately three to four months of the year.
Cayman is a small destination among many of our travel industry distributors, therefore getting a share of voice from their marketers and/or getting time to train their sales and reservation staff is constantly a challenge.
Tour operators will typically spend their own marketing budget promoting mass market destinations, rather than small islands like Cayman and without private sector tourism advertising in our core European markets, the only visibility of the destination is 100 per cent initiated and funded by the Department of Tourism.
Paul Minich (Canada): The key specific is understanding the mindset of Canadian travellers and identifying a brand proposition that appeals to our target market based on what the Cayman Islands can deliver. Each region internationally must talk to different consumer trends and desires.
Thomas Ludington (USA): The US represents almost 80 per cent of the air arrivals to Cayman, which means we’re constantly working on advertising creative, online media optimisation, planning adjusting and making sure we maximise our return on our investment.
For this reason, there are more wholesale partners, more airline partners, travel agents and more promotional opportunities that present themselves to us and I need to monitor them to ensure we’re doing everything possible to maximise our investment, while looking for synergies and ways we can compliment the tactics that are in place.
We are involved in more consumer and trade shows than our private sector partners so we try to maximise these opportunities by working closely with the show organisers, our sales team, and the trade to ensure we’re buying efficiently, engaging the trade and getting the most exposure for our dollar.
We also make sure we’re on top of the online agencies, the wholesalers as well as building demand for the consumers that book directly as the US consumer tends to use a wider variety of channels to shop for and to book their vacation.
As the year progresses, how does your job change?
Don McDougall (Europe): June – August: Strategy planning, preparation for Autumn/Winter events/exhibitions and sales blitzes, advertising planning and media purchasing; September – May: Events/exhibitions and sales blitzes; October – March: Advertising activity.
Year round: PR programme, affinity marketing activity and trade training. But in all honesty, traditional activity timelines have blurred and opportunities can arise at any time.
Paul Minich (Canada): In a sense we are niche marketers. We develop individual strategies for certain market segments. Our current segments are dive, romance, family and extended family travel, culinary and incentive travel.
Each one of these segments has a seasonality to them and define when it is the right time to communicate with Canadians. An emerging niche market is sports tourism, and that too will have seasonality to it as it tends to be geared toward low season activity.
Thomas Ludington (USA): There are budget planning, media and strategy sessions, prep work for the collateral, partner marketing programming, and the show schedules.
Naturally, we try to get ahead of the promotional periods and plan accordingly, but with the close booking cycles that we’re seeing, it’s difficult for the private sector to forecast far enough out to see some softness develop until it’s upon us so we seem to have to be somewhat reactive. That certainly is not unique to Cayman.
Next month: engaging the press, trade shows, social media and Cayman’s attractions.