18 Apr, 2011

More Change Awaits Hotels In Managing Chinese Travel, Online Bookings

Imtiaz Muqbil

Two newly-published studies show how the hotel sector’s products and services will need to cater to the growing legions of Chinese travellers, even as they face the ongoing challenge of managing their distribution systems. These stories, and more in this dispatch..

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Chinese Tourist Millions Will Force Changes in Hotel Development

Cornell Study Claims Listings On Third-Party Sites Increase Bookings On A Hotel’s Own Website

Indian DGCA Launches A Drive to Examine Veracity of All Pilot Licences

ADB Annual Meeting to Discuss Key Issues for Asia

Business Leaders Attend UN-Backed Debate On Green Economy

Upcoming Summit To Focus On Sustainable Management Of Global Rainforests

Patents Issued Under UN Innovations Registration System Hit Two Million Mark

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Chinese Tourist Millions will Force Changes in Hotel Development

The design, style and services of global hotels is set to face a major change to cater to the growing legions of Chinese travellers, according to a study by consultancy company HVS.

Entitled “The 21st Century Game-Changer Up Close: China Outbound Tourism,” the study says that one of the world’s fastest growing source markets “creates new demand for many hotels in the region and beyond. Catering to the high-end segment can be lucrative for hoteliers, yet requires a property to communicate the right image to Chinese consumers.”

It says, “Beyond websites in Mandarin, hotels need to follow through and have Mandarin-speaking team members in the front of house.” A warm welcome from a Mandarin speaking executive and “ideally an introduction to the General Manager, or other senior manager, will certainly give face and recognition”, especially to high-end travellers.

Furthermore, upmarket hotels in China are generally of recent construction and in good condition with impressive lobbies. While hotels abroad may not be able to match the excessive room sizes, they will need to “provide a functional, quality room product with impeccable infrastructure.”

According to the study, the economic boom of the past decades has increased disposable incomes in China. After the basic material goods of housing and transportation, travel has become an increasingly important component of an individual’s self- realization and expression.

Data from the National Bureau of Statistics of China show that outbound travel increased at a compounded annual rate of 18.5% between 2000 and 2010, from roundly 10.5 million to 57.4 million. Clearly, the economic crisis had a negative impact on outbound travel demand, with a minimal gain of 4.0% registered in 2009.

Posting a more than 20% increase in 2010, outbound travel is back on track, and growing fast. Notably, the number of outbound trips in 2010 equates to only 4.1% of the total mainland Chinese population (compared to a ratio of 32.0% for Australia and 13.1% for Japan).

For the bulk of markets, visitation increased between 20% and 180%. Apart from Cambodia, markets registering the strongest increases include Laos (2009 data), Macau, Malaysia, Hong Kong, Vietnam, and Taiwan, all in excess of 100%. Markets like Bali, Japan, the Maldives, the Philippines, South Korea, and Thailand registered strong international visitation growth of 60% to 80% between 2000 and 2010.

Allan Yip, Chief Marketing Officer of Kosmopolito Hotels, is quoted as saying that although Chinese first-time travelers range over a wide spending power spectrum, from value oriented to high end, the overall sightseeing itinerary remains much the same, with differences rather in the type of hotels stayed at and shops visited.”

Chinese tour groups are predominantly made up of families or at times couples. Symon Bridle, Senior Vice President of Operations at New World Hospitality, sees select- or limited-service hotels well positioned to cater to the value-oriented tour groups as the itinerary for a hotel stay “may be in late in the evening and out early in the morning, and the only meal component may be breakfast.”

Yip identifies another visitor profile of free independent travelers (FIT) that are abroad more frequently. Especially safe, regional cities, such as Singapore, are becoming increasingly popular for family vacationing. Usually these destinations are first experienced on business trips and thus provide a more familiar setting, reducing uncertainties. FIT demand has signficant growth potential for these ‘easy access’ destinations.

Another group of travelers consists of high-net-worth individuals who travel frequently. They are generally a younger demographic of 30 to 45 years who converse freely in English and look for exotic destinations and the long-haul markets of Europe and the United States.

Specifically, in relation to this segment, Bridle explains, “A large part of the China market, while not necessarily booking online, uses the internet to do research and get social network feedback to help them make decisions.” It is thus critical to make a brand and property accessible and to communicate in the proper ways.

“Having a Chinese website is a definite plus to gain accessibility in overseas markets, certainly at the higher end,” Bridle continues, “to a degree the China market is looking more for the hotel’s image through visuals, not on heavy data or information content.”

The outbound Chinese visitor enjoys shopping. Motivations here are mainly quality, exclusivity, and ostentation, as certain products are not available or only introduced later in the home market. Heavy taxation in mainland China can also play a role for less-affluent travelers. A diverse mix of attractions to visit and casinos cater to two other popular activities,” the study says.

The full study is priced at US$1,500 but a detailed executive summary is available FREE OF CHARGE here.

Cornell Study Claims Listings On Third-Party Sites Increase Bookings On A Hotel’s Own Website

Ithaca, NY, April 11, 2011 – A new study issued by Cornell University claims to confirm the existence of the so-called “billboard effect” for hotels that are listed on third-party websites operated by online travel agents (OTAs). The study used publicly available data from comScore on brands operated by InterContinental Hotels Group to assess the impact of listing at OTAs upon bookings on the “hotelbrand.com” site.

The study, “Search, OTAs, and Online Booking: An Expanded Analysis of the Billboard Effect,” was conducted by Chris Anderson, an assistant professor at the Cornell School of Hotel Administration. He replicated and expanded an earlier study, which found that a hotel’s listing on Expedia increased total reservation volume—not including reservations processed through Expedia itself. This larger study looks at 1,720 transactions for InterContinental Hotels brands during the summer months of three years (2008, 2009, and 2010).

“It’s clear that there is increased reservation volume on the ‘brand.com’ site as a result of having the hotel appear on the online travel agent site,” said Anderson, “and it appears that the commissions paid to online travel agents actually should be considered a marketing expense.”

Anderson also tracked the surfing behavior of would-be hotel guests. He found that almost 75 percent of the consumers who booked at the brand’s site visited the OTA, with 83 percent performing a web search prior to the booking (and two-thirds doing both). “Some travelers spend enormous time researching hotels online,” he said. “On average, hotel consumers made twelve visits to an OTA’s website, requested 7.5 pages per visit, and spent almost five minutes on each page before booking.”

The study claims that it’s conclusion “confirms and quantifies the so-called billboard effect that occurs when online travel agents (OTAs) include a particular hotel in their listings. An earlier study, based on four JHM-owned hotels, found that a hotel’s listing on Expedia increased total reservation volume by 7.5 to 26 percent depending on the hotel.”

This number excluded reservations processed through the OTA itself. This larger and more exhaustive study analyzes the billboard effect based on booking behavior related to 1,720 reservations for InterContinental Hotel brands for the months of June, July, and August of three years (2008, 2009, and 2010). The analysis determined that for each reservation an IHG hotel receives at Expedia, the individual brand website receives between three and nine additional reservations.

The study is available FREE OF CHARGE from the Cornell Center for Hospitality Research (CHR) here. Registration required.

Indian DGCA Launches A Drive to Examine Veracity of All Pilot Licences

NEW DELHI, (Press Information Bureau) — During the course of investigation into an incident of a Captain from a private airline landing the aircraft on its nose wheel, it was noticed that the license was obtained by the said Captain by submitting forged marksheets of Airline Transport Pilot Licence (ATPL) Examination.

Subsequently, DGCA launched a drive to examine the veracity of all Pilot Licences issued in the past. While inspecting the records of ATPLs issued in the past, 5 (five) more cases of forged result cards came up and were reported to Crime Branch of Delhi Police. In respect of ATPL, almost all licences have already been examined and found to be genuine except in respect of the six detected.

The DGCA has commenced examination of all Commercial Pilot Licence (CPL) records issued during the past and till date, 7 (seven) cases of submission of forged result cards have been detected. FIRs have been lodged with Crime Branch of Delhi Police in respect of all 13 cases (6 ATPL and 7 CPL). Some accused have been arrested including 3 DGCA staff members.

Apart from this, as complaints have arisen about bogus logging of flying hours in some Flying Schools, 3 Special Audit Teams have been constituted consisting of DGCA officers as well as outside experts in order to conduct detailed audit of these schools to detect malpractices if any. Cross verification has been introduced to ensure that the Directorate of Examination and the Directorate of Licencing work in close collaboration.

The Central Examination Organisation (CEO) of DGCA, which is vested with the responsibility of conducting Pilot and AME Licence written examination has multi layer security and foolproof computerised system to maintain secrecy and integrity of the process. There are well defined procedures and the evaluation of answer sheets and result declaration is entirely computerised.

These facts are made known to the public in order to ensure that there is no panic as a result of media reports hinting at huge numbers of fake pilots flying civilian aircraft in the country. This is far from the truth. Strongest possible action has been initiated against persons who have resorted to unfair methods and several systematic changes are being undertaken to see that such instances do not recur in future.

ADB Annual Meeting to Discuss Key Issues for Asia

MANILA, PHILIPPINES, 14 April 2011 – Asia and the Pacific is facing rocketing food and fuel prices, further hurting the nearly 2 billion people in the region struggling on less than $2 a day and complicating economic and monetary policymaking. Floods and earthquakes in the region have added to the pressure.

Meanwhile, environmental degradation and climate change, growing and ageing populations, and global economic rebalancing are among the myriad of other challenges as Asia seeks to cement the foundations for a prosperous future.

The Asian Development Bank’s (ADB) upcoming Annual Meeting of its Board of Governors in Ha Noi, Viet Nam will assess these immediate and long-term hurdles with ministers and senior government officials, business leaders, fellow international financial institutions, and civil society representatives.

The 44th Annual Meeting starts on 3 May, alongside a gathering of finance ministers of the Association of Southeast Asian Nations, the People’s Republic of China (PRC), Japan, and Republic of Korea, or ASEAN+3. ADB’s Annual Meeting will end on 6 May.

Initial findings of a key study which looks at what the region must do to secure sustainable growth over the next four decades will be discussed at a seminar on 4th May. A panel of top policy makers, including the finance ministers of Bangladesh, France, India, and Japan, plus the Viet Nam central bank governor and the Parliamentary State Secretary of Germany are expected to participate.

Asia and the Pacific now accounts for around a quarter of global economic output but this could soar to around 50% by 2050. By then, the region will account for over half the world’s population, increasingly flooding into the region’s cities, using an ever-larger portion of the world’s finite resources, and generate a bigger carbon footprint.

But these are not just issues for Asia; the world needs to rethink too. A special seminar organized by the ADB, the G20 group of leading emerging and advanced economies, the International Monetary Fund (IMF), and the Japanese Finance Ministry will discuss the reform of the international monetary system against the backdrop of slow growth in G7 economies, high government debt in Europe and an economically muscular Asia.

In total, the meeting will gather around 3,000 leaders, experts and officials from governments, the private sector, academia, media and civil society.

Business Leaders Attend UN-Backed Debate On Green Economy

United Nations, Apr 14 2011 — Some 200 representatives from business and industry, governments and civil society have concluded United Nations-supported discussions in Paris on the role of the private sector in the global transition towards a low carbon, resource-efficient green economy.

The two-day “Business and Industry Global Dialogue” was organized by the UN Environment Programme (UNEP), in collaboration with the International Chamber of Commerce and the French postal service Le Groupe La Poste, which hosted the event at its Paris headquarters.

Sylvie Lemmet, Director of UNEP’s Paris-based Division of Technology, Industry and Economics, delivered a keynote presentation on UNEP’s Green Economy Report and stressed how engagement from the private sector is crucial for the scaling-up of a green economy on the road to next year’s UN Conference on Sustainable Development (Rio 2012).

A high-level panel followed with representatives from the UN Global Compact, the Organisation for Economic Co-operation and Development (OECD), the Danish foreign ministry and Hungary’s Deputy State Secretary for Green Economy and Climate Change.

Members of the private sector later discussed the opportunities and challenges outlined in the report with a panel that included the International Chamber of Commerce Task Force on Green Economy and the World Business Council for Sustainable Development.

Katrina Destrée Cochran, Director of Corporate Social Responsibility at telecommunications company Alcatel-Lucent, stressed the importance of measuring the environmental and economic effects of “business as usual” practices.

There were also calls from business leaders to encourage greater investment in sustainable practices. UNEP’s Green Economy Report, released in February, challenges the myth that investing in the environment comes at the expense of economic growth.

The report shows how redirecting 2 per cent of global gross domestic product into 10 key sectors – from forests and energy to fisheries and transport – can boost green growth and create more jobs than a “business as usual” model, while using the planet’s resources in a more sustainable way.

Upcoming Summit To Focus On Sustainable Management Of Rainforests

United Nations, Apr 13 2011 — Top officials from more than 35 nations covering the world’s three major rainforest regions will gather at a United Nations-backed conference in May to discuss the common challenges faced by these vital ecosystems that support more than a billion people.

The aim of the Summit of Heads of State and Government of the Amazon, Congo, and Borneo-Mekong Forest Basins is to achieve a plan for the sustainable management of forest ecosystems in the three basins.

The four-day meeting, which will be held in Brazzaville, the capital of the Republic of Congo, beginning on 31 May, is also part of celebrations of the International Year of Forests (2011). The Amazon Basin of South America, the Congo Basis in Central Africa, and the Borneo-Mekong Basin in South-East Asia make up 80 per cent of the world’s rainforests and contain two thirds of its biodiversity.

“Every one of us, all 7 billion people on Earth, has our physical, economic and spiritual health tied to the health of our forest ecosystems,” said Jan McAlpine, Director of the UN Forum on Forests Secretariat. “Throughout Forests 2011, we will celebrate this intricate, interdependent relationship between forests and people.”

Forest loss is accelerating at a rapid pace across much of the three basins, and forest degradation and destruction now account for 20 per cent of the greenhouse gases released into the atmosphere.

Ms. McAlpine noted at a news conference in New York that the discussions and outcomes of the summit will also feed into the preparations for the UN Conference on Sustainable Development, to be held in Rio de Janeiro in June 2012.

Also addressing the briefing, Henri Djombo, Minister of Sustainable Development, Forestry and Environment of the Republic of the Congo, said it was hoped that the summit will achieve “a treaty or an agreement” for the sustainable management of the ecosystems of the three regions.

Patents Issued Under UN Innovations Registration System Hit Two Million Mark

United Nations, Apr 14 2011 — The number of multiple States patents issued under a United Nations-backed treaty on intellectual property has hit the two million mark since the international innovations registration system was launched in 1978, the UN reported today.

An application by the United States-based mobile technology company Qualcomm2 has become the two millionth one under the UN World Intellectual Property Organization’s (WIPO) Patent Cooperation Treaty (PCT), which makes it easier for companies and inventors to seek patent rights in multiple countries.

A single international patent application under the PCT has legal effect in all 142 countries bound by the treaty. PCT applicants receive valuable information about the potential patentability of their inventions and have more time than under the traditional patent system to decide in which of the PCT countries to continue pursuing patent protection.

The PCT system consolidates and streamlines patenting procedures, postponing the payment of sizeable costs and providing applicants with a sound basis for important decision-making.

“Rapidly growing use of the PCT over the past six years – the time it took to go from one to two million international patent applications – reflects continuously increasing investments in innovation and the growing importance of protecting innovation outputs in international markets,” said Francis Gurry, the WIPO Director-General.

It took 26 years to receive the first one million PCT applications, he said adding that “significant growth in PCT membership has increased the attractiveness of the system and thereby contributed to healthy filing growth.”

Paul E. Jacobs, chairman and chief executive officer of Qualcomm, congratulated WIPO on this historic milestone. “Our growth and success as a company would not have been possible without the strong protection of our inventions around the world. We look forward to contributing to the next million applications.”

Until a few years ago, the largest users of the PCT system originated mostly in the United States or Europe, but there have been a significant change in the geography of innovation with East Asia emerging as the region that currently accounts for the largest number of international patent applications.

Last year, the use of the PCT increased by over 56 per cent in China, now the fourth largest country of origin of PCT applications in the world, while it rose by 20.5 per cent in the Republic of Korea and almost 8 per cent in Japan.