Growing tourism in cyprus

© Mike McCormac 2011

GROWING TOURISM IN CYPRUS

TOURISM HAS CHANGED. SO MUST CYPRUS


• Summary

• The old days aren’t coming back

• A new approach is needed

• That’s based on today’s market

realities

• This is an analysis of:

• The facts

• The opportunity

• What needs to happen

• Contents

• Situation

• Opportunities

• Strategies

• Appendices

INTRODUCTION


SITUATION



• Actual tourist numbers to

Cyprus have fallen 33%

between 2000 and 20101

• Worldwide tourism has

grown c.25% in the same

period2

• That means in market terms

Cyprus tourism has fallen

47% in the last ten years

10 YEARS OF DECLINING TOURIST NUMBERS

0

500

1,000

1,500

2,000

2,500

3,000

Nu

mb

ers

of

visi

tors

on

ho

liday

(,0

00

)


• Actual tourist revenue in

Cyprus has fallen 24%


• In the same period inflation

in Cyprus has been 30%1

• That means in real terms

Cyprus tourist revenue has

fallen 44% in the last ten

years

10 YEARS OF DECLINING TOURISM REVENUE

0

500

1000

1500

2000

Tou

rism

Re

ven

ue

(€

m)


• In the period 2001 to 2010:

• Package holidays declined from

75% to 54% of the total

• Individual travel grew from 25%

to 46% of the total

PACKAGES DECLINE, INDIVIDUAL TRAVEL GROWS

0%

10%

20%

30%

40%

50%

60%

70%

80%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Pe

ren

tage

of

tota

l


• Self packaging has peaked

• Customers don’t have time

to organise it themselves

• They want their holiday to

be easy

• Factors:

• 30% increase in the importance

of comfort


of security (bonded tour

operator)


of destination knowledge

DECLINE IN SELF PACKAGING


• Between 2000 and 2010:

• UK visitors have declined from

64% to 58%

• German visitors have declined

from 11% to 8%

• Russian visitors have increased

from 6% to 13%

2000 2010

UK 64% 58%

Germany 11% 8%

Greece 5% 7%

Switzerland 4% 2%

Norway 3% 4%

Russia 6% 13%

Sweden 6% 6%

France 2% 2%

UK REMAINS THE PRIMARY SOURCE


• Negative

• Expensive

• Poor quality

• Downmarket

• Rip off Cyprus

• Untidy

• Positive

• Weather

• Sea

• Countryside

• English speaking

• Weddings

PERCEPTIONS OF CYPRUS


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”


• The web today is about

social networking

• Static websites are not good

enough

• People browsing the web

want to be involved

• User reviews like Tripadvisor

are trusted more than

commercial sites

• Google

• Facebook

• YouTube

• Yahoo

• Blogger

• Baidu

• Windows Live

• Wikipedia

• Twitter

• QQ.com

WORLD’S TOP 10 WEB SITES IN ORDER


• 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

WHY SOCIAL MEDIA CANNOT BE IGNORED


• 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’

IMPACT OF TRIPADVISOR


• Major tour operators

seeking to increase their

share of revenue

• Trend to all inclusive will

reduce revenue in Cyprus

and damage tertiary

businesses

IMPACT OF ALL INCLUSIVE


• 1 in 4 UK couples now marry

abroad

• 27% increase in British

couples marrying abroad


• Up from 45,000 in 2005 to

just over 57,000 in 2010

• Cyprus is in the top ten of

destinations for UK

weddings abroad

• But indications are Cyprus’

share is slipping

WEDDINGS HAVE BEEN A SUCCESS STORY


• 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

CYPRUS TOURISM ORGANISATION


• 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

IMPLEMENTATION MATTERS


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


OPPORTUNITIES



• What are Cyprus’ assets?

• Weather

• Sea

• Mountains

• Long season

• Open access to countryside

• What are Cyprus’ liabilities?

• Perceptions:

• High cost

• ‘Rip off’

• Down market

• Beaches not as good as

competing destinations

• Long flight

• Untidy

BACK TO BASICS


• Cyprus’ climate makes a long

season possible

• Shoulder months are a

growth opportunity

• March, April

• October, November

LENGTHEN THE SEASON

0%

2%

4%

6%

8%

10%

12%

14%

16%

Jan

Feb

Mar

Ap

r

May Jun

Jul

Au

g

Sep

Oct

No

v

De

c

Visitors by Month (%)

2009 2010


• Top five growth sectors.

Three fit Cyprus’ strengths

• Environmentally friendly holiday

• Adventure holiday

• Nature and wildlife holiday

• Discovery holiday

• Special interest holiday

FASTEST GROWING SECTORS

0% 100% 200% 300%

Special interest holiday

Discovery holiday

Nature and wildlife holiday

Adventure holiday

Environmentally friendly


• 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

ADVENTURE HOLIDAYS


• Special interest

• Culture

• Nature

• Wildlife – especially bird watching

• Walking and hiking

• Cycling

• Mind, body, spirit – and health

• Photography

• Wine/vineyard

• Pottery

• Active adventure

• Mountaineering

• Off road cycling

• Sailing

• Water sports

• Diving

• Off road driving

• Horse riding

ADVENTURE TRAVEL INCLUDES


• Statistics

• 400,000 passengers a year

• £180m per annum

• Forecast to grow 70% over next

three years

• Average spend increased 21%

from £987 in 2006 to £1,198 in

2009

• Largest operators

• Tour operators take 50% of the

market

• The Adventure Company (TUI)

• Explore

• Exodus (TUI)

• Geckos

• Headwater

• …

UK OVERSEAS ADVENTURE TRAVEL MARKET4


• Demographic groups:

• Younger people in the 16-34 age

group

• Single professionals, especially

females

• Affluent active families

• Inquisitive 50+ males and

females

• Typical customer profile:

• Confident, well travelled

consumers wanting more than

sun, sea and sand

• Demanding an authentic ‘off the

beaten track’ experience

• Active

WHO TAKES ADVENTURE HOLIDAYS?


• Rural tourism

• Agrotourism

• Nautical tourism

• Marinas, beaches, cruises

• Casinos

• Cultural tourism

• Cultural and artistic events

• Wine Routes

• Religious tourism

• Nature tourism

• Nature trails

• Sports tourism

• Football, cycling, golf

• Health

• Conference and incentive

• Weddings and honeymoons

CTO SPECIAL INTEREST TOURISM INCLUDES…


• Some solutions

• Group similar activities

• Run activities to a calendar

• For example

• A week’s activities including

mountain biking, climbing and

hiking

• A week’s activities staying in an

Agrotourism location and

exploring vineyards

EACH ACTIVITY IS A SMALL MARKET OPPORTUNITY


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


STRATEGIES



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


• 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

PLUG THE HOLE IN THE ADVERTISING BUCKET


• Communicate differently:

• The target market is highly

internet aware

• Facebook

• Twitter

• Forums

• Live chat

• Decrease conference spend,

increase internet spend

• With better information:

• Customers want lively, engaging

information

• Create a virtual ‘try before you

buy’ using:

• Videos

• Google Earth

• Customer testimonials and

photos

COMMUNICATION IS THE FIRST THING TO CHANGE


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


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


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


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


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 is a sales

and marketing consultant

specialising in the travel and

tourism sector and living in

Cyprus.

• Contact Mike at:

• +357 99 860725

• [email protected]

• www.salessuccessandmore.com

ABOUT THE AUTHOR

mailto:[email protected]

http://www.salessuccessandmore.com/


APPENDICES


SOURCES

• 1: Republic of Cyprus Statistical Service

• 2: Mintel

• 3: Total Media Social Travel Report

• 4: YouGov

Date post:	29-Nov-2014
Category:	Travel
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