20 Oct, 2010

ITB Asia Recovers Big Time In A Global Crisis-Free Year

Imtiaz Muqbil

With plenty of commercial real estate waiting to be filled, Singapore piggybacked on a resurgent ITB Asia to launch a series of travel industry “mega-events” that expanded both the depth and breadth of participation and raised Singapore’s profile on the global travel stage.

SINGAPORE: With thousands of square metres worth of commercial real estate to be filled, both now and in the near future, Asia’s best planned city-state piggybacked on a resurgent ITB Asia 2010 to launch a series of travel industry “mega-events” that expanded both the depth and breadth of participation and raised Singapore’s profile on the global travel stage. While many of the events in the Lion City this past week were dominated by discussion of Asia’s travel industry boom, the entrance of Egypt as ITB Asia’s “partner country” has paved the way for stronger travel linkages between the Asia-Pacific and the other emerging global power bloc, the Middle East and North Africa, as well as Turkey and Iran. If the world remains at peace for at least two years, this year’s ITB Asia could prove the catalyst for a significant shift in both intra- and inter-regional travel patterns in the second decade of the 21st century.

Indeed, the mood at ITB Asia was upbeat purely because there has been no global crisis so far this year. After a tumultuous decade, the prevailing calm was the primary reason why ITB Asia itself could recoup the losses of last year. A visibly relieved Raimund Hosch, CEO of Messe Berlin, ever mindful of the shareholders he has to answer to back home, said the three-day B2B travel show had attracted 720 exhibitor organizations, up 6% over 679 exhibitors in 2009. He said the line-up of 62 national and regional government tourist organizations, up from 54 last year, had included new entrants such as the Moscow Exhibition and Convention Agency, the Korean National Tourism Organization, the Moroccan Government Tourist Office, the Nagasaki Prefecture Convention and Visitors Bureau, the Tourism Council of Bhutan, and the Tourism Administration of Guangdong Province in China. At the same time, the presence of a small Latin American contingent, including sellers from Guatemala, Argentina and Brazil, signalled that outbound Asians will soon be venturing into new territories.

Mr Hosch told the opening press conference that ITB Asia 2010 was characterized by five themes: exhibitor growth, better quality buyers, a much greater MICE (meetings) industry profile, Egypt as a partner country, and that ITB Asia, with its broad appeal to multiple sectors of the travel industry, was now attracting other travel events to start up alongside.

Having raised the costs of exhibiting, the recent global financial crisis notwithstanding, the ITB Asia organisers had to work overtime to ensure buyer quality. Mr Hosch said the 580 hosted buyers this year had undergone an even more stringent whetting system. Buyers had to be recommended either by exhibitors or by other established high quality buyers who could vouch for the professionalism and relevance of the proposed hosted buyer, he said. Buyers who performed well at ITB Asia in 2008 and 2009 were invited back. A staggered invitation process yielded a more balanced geographical market mix among buyers.

This year, the buyers breakdown was categorised into corporate travel, leisure and MICE. A check of the directory indicated that Indian buyers had the highest presence, with 71, followed by Singapore with 33. Australia had a sizeable MICE representation, with 27. Thailand, normally considered an inbound country, also had 26 buyers. In addition to a strong corps of buyers from Hong Kong, Indonesia and the Philippines, buyers from countries with future potential included Iran, Nigeria and Slovenia. Overall, the percentage of MICE (meetings, incentives, conventions and exhibitions) travel buyers increased from 32% to 37%, Mr Hosch said.

There was no doubting the buzz as both the booths and aisles hummed with heavy-duty discussions all through the show. With a few exceptions of sellers who complained about being put in poor locations, the high and ever-rising cost of exhibiting, and mix-up in appointment schedules, it was difficult to find anyone who expected to walk away disappointed. Even Bhutan’s tourism Director General said his contingent was happy and that they would be back next year.

The associated events certainly helped pull in the numbers. Referring to it as a week of “mega-events” under the title of TravelRave, the Singapore Tourism Board worked with ITB Asia and other industry partners to include an Asia Travel Leaders Summit, an Aviation Outlook Asia forum, a World Savers Congress, an Association Day, a Luxury Meeting Forum and a Responsible Tourism Forum. This was in addition to a forum for online travel, marketing, technology and social media enthusiasts which has been running since ITB Asia launched in 2008. A final event, the Singapore Experience Awards, will be held on 28 October.

The websites of each of these events listed an average attendance of about 100-150 each, ranging from the travel technology forum which attracted about 300 people to less than 50 at the World Savers Congress and the Responsible Tourism Forum. That in itself is a clear reflection of both the times and the prevailing mindset — responsibility in tourism and saving the world may be nice touchy-feely stuff but it’s the tech-toys that help prop up the next quarterly profit and loss statement.

In a foreword in the official catalogue, Singapore Tourism Board Chief Executive Ms Aw Kah Peng indicated that the TravelRave mega-event was simply an example of Singapore doing what it does best – capitalising on its geographic location, superb infrastructure, transportation and convention facilities to become a business bridge between East and West. “A global exchange capital where talent, technology and ideas converge, Singapore continues to attract business event organisers and travellers from all around the world,” she said.

Outlining Singapore’s product development, she made clear that millions of dollars worth of real estate is now waiting to be filled. This includes the recent opening of two Integrated Resorts, Marina Bay Sands and Resorts World Sentosa, plus Universal Studios theme park, new celebrity chef restaurants, plus a Broadway show and a circus. Coming up soon are an international cruise terminal, Gardens by the Bay and a River Safari. Added Ms. Melissa Ow, the STB’s Assistant Chief Executive, Industry Development II Group, “With the continued development of Asia Pacific as a destination and a thriving outbound market, much of the world’s travel and tourism growth is occurring in this region. This is an opportune time for the travel and tourism industry to seize the prospects offered by Asia’s vibrant economic growth.”

If the buyers’ profile shifted to reflect the new realities of a rising Asia, the speakers’ profile at the mega-events did not. The events were dominated by non-Asian individuals and companies, many from western countries which are themselves in economic trouble today, facing labour strikes and a rise in right-wing political parties with clearly racist agendas. All this will impact the image of their countries and, ultimately, their tourism industries. Asia survived the recent global financial crisis in good shape because its leaders learnt the lessons of past mistakes – whereas western leaders have not. Hence, Asian travel industry leaders are well placed to turn the tables and demand accountability and transparency from the Western governments and national tourism organisations on everything from travel advisories to visa processing bureaucracies, racial profiling and security. The only event at which that may have been the case was the travel leaders summit which, unfortunately, was closed to the media and all non-invitees. If these mega-events are to avoid becoming mutual-admiration clubs of executives preaching to the converted, this issue will have to be addressed.

With ITB Asia having signed up to remain in Singapore until 2013, the mega-events will continue. As always, neither Messe Berlin nor the STB divulge financial details. Ms Ow indicated that while the STB had given both cash and kind support to the associated events, their costs had also been offset by some of their respective organising companies and the sponsors. The key question of how much Singapore is paying to help keep ITB Asia in Singapore remains unanswered. A partial answer comes from Thailand where a senior executive of the Thailand Convention & Exhibition Bureau confirmed that Messe Berlin had approached it to relocate the show to Bangkok, in exchange for a six-figure US dollar amount. Although the Thais declined, they have significantly expanded their exhibitor presence at ITB Asia.

As Asian travel grows, both within the region and abroad, this year’s presence of Egypt as a partner country will facilitate the next generation of inter-regional travel between the Asia-Pacific and the Middle East/North Africa region, as well as Iran and Turkey. Egypt received advanced and extensive branding and positioning before, during and after the show. Said the Egyptian delegation leader Mr Hisham Za’azou, First Assistant Minister, Ministry of Tourism, “Asian markets are among the most favoured tourism markets for Egypt and we are always looking for opportunities to attract more tourists to the jewels of Egypt.”

In addition to a gala Egypt Night hosted on 20 October, the country “where it all begins” got a slot on the opening press conference and later held its own media event. It was also prominently featured in the press releases, website and all the trade-show literature. Mr Za’azou noted that Egypt had a total hotel capacity of 215,000 rooms and another 200,000 rooms coming up in the next few years. It generated 12.5 million visitors in 2009 and has already recorded 10.5 million in Jan-Sept 2010, up 18% over the same period of 2009. Asia is a logical choice as Egypt diversifies its source-markets away from the traditional focus on Europe and North America, and pursues a goal of 25 million visitors by 2020.

The Egyptian presence is part of growing and long-overdue Arab world interest in enhancing the region’s profile in Asia. Qatar and its national airline Qatar Airways are making inroads too. The Qatar Tourism Authority sponsored the ITB Asia 2010 buyers lounge, and preceded its presence at the ITB Asia with a two-week roadshow through Seoul, Hong Kong and Kuala Lumpur. Qatar Airways has just announced the launch of its first flights to Phuket and Hanoi. To be served with a daily flight, the Thai beach resort island is Qatar Airways’ third island resort in Asia after Bali and Cebu. The UAE, too, had a strong presence of 39 seller organisations. Turkey had 7 and Egypt 6, both numbers that will grow in future. The UAE emirate of Sharjah had a press conference to raise its own product profile and position as yet another gateway to the UAE, via its airline Air Arabia, the first low-cost carrier in the Middle East. In time, these countries will have to step up their presence in Asia, with others such as Tunisia, Morocco, Jordan and Syria sure to follow.

ITB Asia and its package of side events will have a ripple effect on other shows industry-wide. With budgets due to remain tight and the impact of technology making itself felt, exhibitors will continue to carefully evaluate which show they attend. Hotel rates in Singapore will also rise proportionately, adding to the cost. The ITB Asia’s immediate competitor in the Asia-Pacific is the PATA Travel Mart, to be hosted in New Delhi next September, just a month before ITB Asia 2011 in October. The PTM will need to indulge in some soul-searching about how to position and distinguish itself from the onrushing competition. The warning signs for PTM were contained in the words penned by Mr Hosch in his foreword in the official catalogue: “Messe Berlin and ITB Asia will not take (Asia’s economic) growth for granted. We are constantly revaluating and improving our product to meet changing demands in this fast-growing market. Our strong network within the industry and our close ties with leading players generates great new ideas and platforms to do business at ITB Asia.”

Mr Hosch’s choice of words is apt, but what the industry can never take for granted is the belief that the coast is clear. Just as no tree can grow without adequate soil and climatic conditions, ITB will grow and Singapore become The Annual Meeting Place for the glitterati of the Asia Pacific travel industry only if there is global geopolitical peace and economic stability. Well under way today is a “Power Shift”, the title of a book written by futurist Alvin Toffler (and keynote speaker at this year’s Travel Industry Leaders Summit). Power shifts do not take place without tumult, and the rise of Asia will not always be peaceful. Fading powers do not make way gracefully for new ones to emerge, but often try to delay or disrupt the inevitable. That danger has not receded.

With only two months to go before the end of the first decade of the 21st century, the travel & tourism industry has learnt that its primary asset is indeed peace and stability. Protecting and preserving that asset by every possible means will have to become its topmost agenda and mantra in the second decade of the 21st century.