French Market Trends 2011

Working in the tourism industry is definitively an interesting job! This keeps our eyes wide open on what’s going on in the world as every event, small or major, is impacting the travel industry.

On the French Market, the many events that impacted our planet these last years are profoundly changing the way the French are traveling and, therefore, the Tourism Industry in general. Several years ago most travelers were looking for the bargain that would be the trigger to choose one destination over another.  Those looking for a good package for less money made the choice of Morocco or Punta Cana, or the like. This mass tourism has decreased significantly.

Today people who have the wealth to travel internationally are mostly experienced travelers. They will travel to destinations that can easily be booked online (such as NYC or the theme parks in Orlando). A lot of them also make the choice to discover different and unique destinations. Many of them like to book with a specialized tour operator as the trip may be more complex to set up.

This trend negatively impacts the huge companies that were selling mass tourism products. Many of these companies are now reducing their staff and have moved to “out of Paris” offices. At the same time, middle sized and niche operators are showing growing success because they are providing genuine products added to real service. The product managers made a significant job to select the products and the sales persons are educated to pass on good programs to clients who want to travel to find “something special” and unique.

We see more and more niche tour operators developing significant good business. Who could imagine, even a few years ago, that we could have a tour operator in Paris who would offer only winter products? No one would have bet a dime on this project! We have this kind of company that is very successful as they provide a unique experience. And this is exactly what most potential travelers want: unique and genuine experiences! We see this trend for other niches like golf, motorcycle rides and horseback rides. In France we now have several successful tour operators that sell very well our ranch products.  One of the (many) beauties of the Rocky Mountain International program is that we anticipated this trend.

Having offices in Europe that help the actors of the Tourism Industry to discover our region for more than 20 years is just brilliant! Our fantastic region is packed with unique experiences that match perfectly the trendy motivation to travel: to discover genuine and off the beaten path destinations.

And this is now a reality. Thanks to our states’ long-term investment in this market our region is very successful in France! As a matter of fact, when we started to represent the Real America region in the French Market, only a few tour operators were selling our products. Since then we have had increasing numbers of new companies that sell the beauties of Idaho, Montana, South Dakota and Wyoming. We are noticing as well growing interest for our gateway cities and partners that are benefiting from the increasing visibility of the RMI region.

Thank you for your continuous interest in the French market. We look forward to keeping on whipping and spurring for the Real America!

Benelux Market Trends 2011

Covering the Belgium, Luxembourg and Netherlands markets.

The year 2010 will be remembered by the European tourism industry as the year of the Eyjafjallajökull volcano outburst in Iceland and the year of the World Cup soccer in South Africa. Also as a year in which the worldwide economical crisis slowly started to recover and in which both the Netherlands and Belgium held elections for a new government. At the beginning of 2011 the world was shocked by major natural calamities like the earthquake in Japan, the flooding in Australia and the tornados in the Midwest of the USA. In addition to this the world is also faced with political uproars in the Middle East. The financial position of Greece, Spain, Portugal, Ireland and even Italy is uncertain and puts an enormous pressure on the Euro. This might even be the start of a new financial crisis.

Although the economic situation seems uncertain, the Benelux market continues to be a solid and high quality source market for the US. Travel from the Benelux countries to the USA recovered in 2010 with a 4% increase.  With 842,819 Benelux visitors arriving in the USA, the Benelux retains its status as the fourth European market for the US.

The residents of the Netherlands receive on average 25 paid vacation days, plus national (bank) holidays. The Dutch have the highest travel participation in the world, with over 81% of the people taking at least one traveling holiday every year. The vacation frequency increased significantly from 1.84 in 1980 to 2.84 in 2010.  Also, the percentage of vacations abroad increased faster than the percentage of domestic holidays over the past 30 years. Domestic holidays increased by 55%, European holidays by 136% and holidays outside Europe increased by 460% since 1990. The average budget of the Dutch grew from € 2,270 in 2009 to € 2,375 in 2010.  The Belgians receive on average 20 paid vacation days, plus bank holidays. Research shows that 63% of all Belgians took at least one traveling holiday in 2010, the same percentage as 2009. Their average budget however grew from € 2,066 in 2009 to € 2,083 in 2010.

Over the years, long haul travel has become more common, not only for individual travelers or couples, but also for families with children. USA, the Caribbean and Asia are the most popular far destinations. 25% of all Dutch indicated taking an intercontinental vacation in the past 5 years, 31% indicate planning on taking one in the next 5 years. Packaged tours are losing ground in favor of separate bookings for air transportation, car and accommodations. In 2010 only 15% of USA travelers booked a packaged tour.

The influence of internet and more specifically review websites, blogs and social media is still gaining importance. Approximately 60% use the internet as the main inspiration to decide on their travel plans, against 33% that use tour operator brochures as an inspiration.

These trends reflect on the Benelux travel market; the large tour operators that specialize in package tours are struggling; the demand for tailor made travel exceeds the demand for packaged tours. The tour operators specialized in long haul travel focus on “experience” by printing life style magazines instead of brochures or even opening travel shops.

The specialized web-based direct sellers, that gained market share over the last couple of years, still rely on their expertise but have improved their websites with more destination information and better booking engines.

Despite ongoing negativity in the economy and many natural and political disturbances, the people of the Benelux will continue to travel. The main question will be what destination they will choose. No one in the travel industry dares to predict the way the market will develop. The one thing everyone agrees on is that the “battle” will be fought on the internet and “inspiration” and “experience” are keywords for 2012.

German Market Trends 2011

Covering the Germany, Switzerland and Austria markets.

Germany lists the strongest recovery among the big Euro countries after the recession year of 2009. The strength of the German economy is a big plus for the business activities in the whole of Europe, as Germany could have a positive influence, says the EU commission. After the 3.7% increase in GDP this year in Germany, the EU commission holds onto a 2.2% plus for 2011 and a predicted 2.0% plus for 2012.

The Swiss market, for example, kept growing throughout 2010 by nearly 10%. Based upon all indications we are confident that 2011 Swiss arrivals in the U.S. will be crossing the “magic line“ of 400,000. The rate of exchange of now 0.87 Swiss Francs to the USD (down from 1.05 a year ago) makes the destination USA a “temptation“ which is hard to resist. For the year 2010 we can report a total of approximately 1.8 million arrivals to the US from Germany, which is a stable result.

Short-distance travel in Europe stagnated, whereas long-haul trips undertaken by Germans grew by 5%. The cruise market continued to boom. Both sea and river cruises grew by 10%, while air travel increased by only 2%. Car travel fell by 2%.

We registered many new tours into our region in 2011. A trend can be seen in topics such as authenticity, natural experience, etc. and RMI is an ideal destination for such themes. For example German Tour Operator Canusa invents “Taste of Travel” – special Fly Drive routings and typical accommodations combined with activities that are supposed to provide a deeper and authentic experience. Often these specials are additionally promoted online. Smaller and specialized operators tend to publish their product only online or use alternative sales and marketing tools such as direct mailings, consumer shows, flyers and online marketing. Big wholesalers such as Dertour, Meier’s and FTI, however, hold on to the classical brochure. For the 2011 summer season, FTI increased the number of catalogues offered from 20 to 28. New in all catalogues is a section ‘Urlaub Plus’, a product line for exacting clients with customized offers. Another example: In their 2011 catalogue, Thomas Cook expanded their North America program by 148 hotels, four tours, and one cruise.

The outlook for 2011-12 is generally positive, with a stable economy, a profitable Euro-USD exchange rate and people from the German speaking countries looking for authentic experiences.

With our German RMI Website we cater to a growing percentage of people, those who inform themselves online about their travel destination. We registered a huge increase in visitation especially during the winter and spring months when vacation planning traditionally is done. We hope to continue expanding our RMI website even more by adding more photos, more route suggestions and insider tips. In combination with the German Real America Guide and a strong presence at the German consumer shows we look forward to a bright and promising future - increasing the popularity of the RMI states even further.

UK Market Trends 2011

The last year has been a rather muddled one economically and politically in the United Kingdom. The country is still feeling the pains of the 2008/9 Recession. Britain felt the effects of that downturn, caused by the banking crisis of 2008, more than any of the other major western European economies because of her close links to the US economy and her dependence upon the financial services sector. In order to mitigate the worst effects of recession, the government of the day incurred enormous financial debts unprecedented in peacetime. When elected in May 2010, the current government set out to wipe-out those debts as quickly as possible, predominantly through massive across the board cuts to public expenditure of the order of a third or more in many instances. Although announced in 2010, many of these cuts did not come into effect until 2011, and it is only now that their full force is truly being felt.

The result at street level is that, although the recession officially ended in the fourth quarter of 2009, there has been no real recovery. Although the heavy borrowing of the last government did protect many people from what might have been some of its more damaging aspects, such debt levels were unsustainable.  Banks have been reluctant to lend to businesses that might otherwise have been able to speed the recovery, while the public sector (which employs 25% or so of the working population) is mired in uncertainty as to exactly how the cutbacks will be translated into job losses. The result has been that although the recession itself was not quite as bad as feared, its effects have been much longer lasting than was hoped, with no end yet in sight and a very real fear amongst the public at large of the “double-dip” recession that the media has been noisily speculating on since almost before the first “dip”.

In terms of consumer confidence, this time last year there was some brief guarded optimism - it had turned out to be a better than expected summer season and forward bookings were looking reasonably healthy. Even January performed well, but then a dawning realization that we were “not out of the woods yet” took hold in the marketplace and booking levels quickly fell away. Even non-economic events conspired against travel abroad, with record-breaking unseasonably good weather in March, April and May combined with a total of 5 public holidays (1 extra for the Royal Wedding) to lead many people to actively consider a “staycation” in the UK. In the event, many people changed their minds owing to the very wet summer that followed, but by then the damage was done. Summer holidays sold in March are usually sold at profit. Those sold in July are heavily discounted and usually make a loss. As a result, it is estimated that many travel agents and tour operators are only breaking even at best, particularly those (the majority) who depend upon the Mediterranean package market. Certainly, Thomas Cook, the largest and oldest UK travel group, has suffered badly leading to the recent resignation of its Chief Executive (who joined as a trainee aged 18) and other long serving members of its board. This company’s woes, it is probably safe to say, fairly reflect the state of the UK travel industry generally.

What of our own position within the UK market, therefore? Here, at last, we are able to inject some optimism into our report. One of the effects of the UK economic situation is that society has become significantly polarized. Not good news for Britain, perhaps, but it does mean that there is a significant segment of the population that has been cushioned from the worst effects of the downturn and remains reasonably affluent. In the main, UK travelers to our region are drawn from this sector of the population. Also, there continues to be high levels of interest in our region amongst discriminating UK travelers. This is currently on an upward spiral whereby that interest inspires media coverage which generates further interest, then additional coverage, etc. Certainly, the specialist operators that our region relies on heavily are reporting good business in bookings to our four states and are eagerly adding new itineraries. It is a moot point whether it is a good thing that this increase in interest has happened now to insulate us against the general downturn in UK travel bookings, or whether it would have been better coinciding with the boom times and generating even more business. It is what it is and when it is and it is a lot better than what is happening to UK bookings to just about any other part of the world. Hopefully, it will continue to grow and last into the good times whenever they may come along. Certainly we will do all in our power to ensure that that is precisely what happens!

Italian Market Trends 2011

The termination of business of some tour operators due to the spring 2011 Middle East and North African troubles, along with the crisis of the two main tour operator players Hotelplan Italia and Kuoni Worldwide, has re-shaped the tour operator segment outlook, allowing smaller-sized operators to emerge in a much clearer way and more aggressively, including a good number of web-based operators.

In 2011 there are still signs of the ongoing economic crisis, presenting a confused customer/consumer not knowing exactly how to behave during uncertain times. Obviously the medium high social / economic classes have suffered less and they are becoming the main target for the majority of the travel partners, as they get out of this demographic the most rewarding results.

The still strong Euro effect is very much helping Italians to afford travel to the USA, which continues to be the preferred long-haul destination among several international ones, especially in 2011. The purchasing capacity for vacations in Italy puts the country in 6th position in international rankings. Consumers/travelers in Italy still perceive a vacation as one of the most “durable” and valuable experiences in life.

The overall tourism offer is now focused on extra values, the so-called added values, the “plus” that local services in a destination are able to offer. Lodging quality is fundamental for Italians always looking for high standard levels; the same applies for gastronomy.

Honeymoon Travel is in a constant positive growing trend in 2011, and the US is in the lead of preferred destinations by Italians. 78% of Italian retailers sell honeymoon travel with prices from 5,000 to 10,000 Euro, and only 18% of agencies sell for lower budgets. For those agencies – actually 45% of them – the honeymoon travels affect their income between 20 and 40%, while for 49% of agencies honeymoon business accounts for at least 20% of their total revenue. The remaining 6% count on a share far higher than 40% in honeymoon travels.

The entire RMI region is perceived as a genuine, wild and uniquely different US destination able to offer unconventional “once in a lifetime” vacations. Touring on self drive itineraries by car or motorbike is the preferred way, followed by the escorted in-country language guidance for those who do not feel comfortable with the English language. Overall there is a good range of itineraries promoted by travel professionals in the market place: National Parks are leading the product range, followed by western heritage (rodeos are highly requested) and Native American experiences. Ranches are considered the most “exotic” ingredient during an RMI holiday. Among the outdoor activities for the region, horse riding remains the main attraction, followed by hiking, and winter season is peaking up nicely with snowmobiling on top, followed by dog sledding and all skiing challenges, including eli-ski.

The internet remains very important for consumers and trade partners as the first source of information and inspiration to plan vacations. The Italian websites are visited the most, while the still huge quantity of English ones are pretty much disregarded. Tour itineraries are the most beloved, giving practical and geographical examples of available itineraries.

Australian Market Trends 2011

Australia enjoys one of the highest standards of living in the G7. Australia's economic standing in the world is a result of a commitment to best-practice macroeconomic policy settings, including the delegation of the conduct of monetary policy to the independent Reserve Bank of Australia, and a broad acceptance of prudent fiscal policy where the government aims for fiscal balance over the economic cycle. Economic recovery is strengthening, with GDP forecast to grow by 3.25% in 2010‑2011 and 4% in 2011-2012, leading to further reductions in the unemployment rate. The success of monetary and fiscal stimulus will help the budget return to surplus in 2012-2013, 3 years ahead of schedule. Net debt is expected to peak at 6.1% of GDP in 2011-2012, considerably below the previous forecast of 9.6% of GDP.  The unemployment rate is expected to fall from its early-2010 level of 5.3%, down to 5% in late 2010-2011, and 4.75% in late 2011-2012, around levels consistent with full employment.

Travel to the US is at its highest level ever.  In 2010 904,240 Australians traveled to the US and in 2011 numbers are expected to increase to over 1 million.  The US has always been a dream vacation for the average Australian.  With Australia’s strong economy and the US dollar currently trading at 90 cents to the Australian dollar, many feel that there will never be a better time to travel to the US.  Australians have one of the most active lifestyles in the world and are looking for active vacation experiences.  Hiking, white water rafting, bike-riding, horseback riding and water sports of any kind are very popular with Australian of all ages.  Camping and RV travel are one of the fastest growing travel segments in Australia and our region is becoming popular for that type of travel. 

Developing awareness of our region has been ongoing.  Although Australians travel to the US each year (over 800,000 flying to the West Coast which offers great gateway locations for travel to our area) the majority of Aussies still know little or nothing about US destinations outside of CA, NY, FL and NV (specifically Las Vegas). This is a real challenge for our region, which has limited promotional dollars.  Strong media support has been key to our success in Australia.  The recent announcement by Qantas that they will be opening new non-stop flights from Melbourne to Dallas/Ft Worth and Sydney to Dallas/Ft Worth will bode well if Cheyenne continues its daily service to that airport.  We have been working very aggressively with the “niche” tour operators in Australia.  John Cruwys from Elite Travel Event Tours has added two tours to our region since attending the Roundup in Rapid City in 2011.  Adventure World is one of the largest travel wholesalers/tour operators in Australia and is recognized as a leader in “non mainstream’ travel.  In Australia they are the leading supplier of niche travel product to Canada and US.  We were very surprised to learn that the only US product they were offering was in Alaska.  Adventure World has decided to expand their product offering to our region.  We have worked very closely with Heidi Bullough, US product manager for Adventure World, and we will be featured in the Canada/US Catalog for 2012 as well as on their website. 

Interest in our region is exploding and we have been inundated with requests for both media and trade fams.  We hosted 5 media/trade fams in FY 2011 and expect to more than double that number for FY12.

Nordic Region Market Trends 2011

Covering the Norway, Sweden, Denmark and Finland markets.

2010 was a very good year for the Nordic Countries.  The Scandinavian countries of Norway, Sweden, Denmark and Finland are among the leaders in holiday long haul travel to the US.  Posting over 950,000 visitors to the US in 2010, the market is on track to exceed 1 million in 2011.  With a total population of over 25 million and consistently strong economies, Scandinavia has the highest quality of life in all of the free world and these are avid travelers.  In 2009 BBC World Media and the International Economist Magazine ranked Norway #1 and Sweden #2 in overall quality of life in the world.  With a minimum 6 weeks paid vacation most Scandinavians plan at least one long haul vacation every year.

We continue to make real progress in Scandinavia.  We are featured in all of the key Scandinavian Tour Operators’ printed catalogs and/or websites.  We are hosting more and more media and trade fams to our region.  Our popularity as a holiday destination continues to grow as we utilize both traditional and non-traditional methods to promote the Real America to the Scandinavians.

Norway: Norwegians are among the savviest users of the internet in the world.  The travel industry is seeing a real shift in the way Norwegian travel customers book their travel.  More and more travelers are booking air, rental car and accommodations directly over the internet.  Two new tour operators/wholesalers entered the market in 2009 and both are solely internet based (American Holidays and American Tours).  We are working closely with them to insure that packages to our region are offered through their websites.  We are also working closely with Nordmann-Reisen and America Specialisten (two of the biggest US product specialists in Norway) to insure that product from our region offered in their catalogs and on their websites continues to increase. 

Sweden: The Discover America Committee has become one of the most aggressive in Europe.  They hosted over a dozen travel agent seminars throughout Sweden in 20010, their website is first rate and we are very well presented.  They are currently working on a “training program” for travel agents that will be internet based and allow agents to become certified “experts” on US travel product.  The board has officially recognized our efforts in Sweden and their support continues to grow as our region gains popularity as a USA travel destination.  Tommy Swanson (Swanson’s Travel) continues to give us his full support and we are seeing healthy growth in the packages he is currently offering.  Tommy Swanson is the major US product specialist in Sweden (90% of ALL tours from Sweden to the US are booked through Swanson’s).  Swanson’s recently finalized an agreement with ETickets (the largest internet based air discounter in Norway) to start offering their huge inventory of travel packages.  Swanson’s will use their marketing and promotion expertise (and dollars) to stimulate interest in their products in Norway and ETicket will be the internet-based booking agent.  This should be very successful and subsequently good for us. 

We are working closely with TEMA travel (a specialty travel agent/tour operator/wholesaler based in Stockholm) to develop packages for their clients.  Pamela Clark, their Senior Product Manager for USA (and the President of Discover America Sweden), and Lars Bjorkmann, USA Sales Director, have both been on fams to our region and continue to expand our product in their catalog and website. 

Denmark: This market showed the most potential new growth for us in FY2011.  Two of the most popular US travel product companies (FIT, group tours and wholesalers) Marco Polo/My Planet and Team Benns announced that they are taking a new approach to travel products in 2010.  Realizing that most of their traditional travel clients are purchasing air, rental car and accommodations over the internet, they feel that a shift in product mix and business models is essential to sustain viability.  We are working with them on new products and programs that feature our region and have committed to participating in Staff trainings and clients events in October of 2011.  They are particularly interested in non-traditional vacation packages that include “active activities” (rafting, hiking, biking, horseback riding, etc.) as well as non-traditional travel opportunities (RV and motorcycle travel in particular).  They have both identified our region as a very strong area of growth for their businesses and are committing substantial dollars to develop it.

Finland: Our plans for Finland will continue to include distribution of our materials at MATKA.  This year the “Real America” has been asked to be the feature region in the USA Pavilion and we have agreed to provide a framed print to be featured and raffled on the final day of the show.  The Discover America Committee in Finland is working on developing a training program through their website.  We have provided photos and copy as they develop the site and hope they will have their program up and running by later this year.