10 things we learnt at WTTC’s Europe Leaders Forum
Over 150 CEOs, Ministers and Travel & Tourism leaders gathered in Lisbon, Portugal, on 11 September for WTTC’s first Europe Leaders Forum, hosted by Turismo de Portugal.
Here are ten highlights from the discussions:
1. Portugal is the rising star of European tourism.
Travel & Tourism accounts for 17.3% of Portugal’s GDP and 1 in 5 jobs, and in 2017 the sector grew by 10.3%. Travel & Tourism has been prioritised by the government, which has set out an ambitious tourism development plan. Meanwhile, Portuguese strategy to spread visitors both across the territory and the calendar year have seen its visitor growth double, and 200 new air routes have opened up in the last two years.
2. Hotel demand in Europe is outgrowing supply.
Hotels are 10% busier now than before the global financial crisis, according to latest STR data. Europe tops world charts in terms of growth in revenue per available hotel room (5.6%) in 2017, with only the Middle East outperforming the region.
3. Transparency is key to dealing with a crisis.
Thomas Cook Group CEO, Peter Fankhauser, stated that transparency and openness is the single most important thing when dealing with a crisis. Talking about the recent death of two customers in Egypt, he highlighted the necessity to be bold, decisive and stick to the facts, with the underlying ethos of putting the customer at the centre.
4. Travel & Tourism companies need to plan for a ‘no deal’ Brexit.
Mark Tanzer, CEO of ABTA, told delegates that he is advising members on contingency planning in the event of a ‘no deal’ Brexit. The most critical element, according to Tanzer, is that the UK maintains access to the European Single Aviation market, but of significant concern is how borders will be handled. The UK is one of the most important inbound markets for EU countries, who are already seeing a slowing of growth from the UK and reduced spend due to the weakened pound.
5. 70% of MSC Cruises customers book their next holiday in a destination they visited on a cruise.
With the impact of tourism overcrowding a key concern for Europe’s Travel & Tourism sector, and cruise often at the centre of the discussion, Gianni Onorato, CEO, MSC Cruises, highlighted the important role the region’s growing cruise sector plays in opening up destinations to new markers and the often overlooked link between cruise and longer stay business.
6. Consumer demand is driving the sector to be more sustainable.
90% of Thomas Cook customers reported that they care about sustainability and animal welfare while travelling. Talking from an investor perspective, James Hogan, Executive Chairman, Knighthood Capital Partners, said:
“What we’re seeing in a changing society is that the consumer is demanding change; demanding respect … It’s not so much regulation and government, there’s a mindset of change where people are aware … You have to have green credentials.”
7. Off-peak visitors are key to sustainable growth.
Dr Tim Moonen provided a toolkit for success in sustainably growing travel sectors, which included diversifying the locations in which tourists visit, spreading visitors across seasons, and reinvesting in destinations. This method has a track record; Manuel Caldeira Cabral shared that Portuguese strategy to correct seasonal problems in visitation saw their number of off-season visitors double.
8. Adoption of biometrics across EU will require changing mindsets.
While there is widespread industry support for increasing the use of biometrics for travel security, MEP Claudia Monteiro de Aguiar cautioned delegates that some colleagues in the European Parliament would be resistant based on civil liberties and data protection concerns, and that it would take a change in mindset for legislation to be passed in this area.
9. Plastics are being phased out of use, and water re-used.
MSC Cruises discussed their goals of recycling 100% of grey water used on their ships, and of their replacement of plastic straws with pasta straws. Mystic Invest outlined plans for their new expedition vessel, on which no plastics will be used. Thomas Cook Group are also looking to launch a new plastic policy in the near future.
10. We were told that there are three key drivers of investments in hotels:
Strength of economy, strength of political environment, and supporting infrastructure, and Europe is currently well placed in all of these.