MARKETING REPORT – UK EUROPE JUNE – OCTOBER 2010 Overview

MARKETING REPORT – UK EUROPE JUNE – OCTOBER 2010

Overview of the European Travel Industry

Global Tourism Trends The last quarter has been a challenging year for the travel industry globally; and although the ash cloud has gone from the skies above northern Europe, global tourism continues to see disruption from other causes, including industrial action, forest fires in Russia, the oil spill in the Gulf of Mexico and flooding in northwest Asia. 1

According to the latest European Travel Commission Quarterly Report on ‘Trends and Prospects for European Tourism’, European tourism is indeed improving from the declines seen a year ago, but recovery remains ‘modest’, and in part reflects strong domestic rather than cross-border travel.

The Ipsos survey results revealed that even if the economic crisis affects summer booking trends, Europeans travellers still have a strong desire to travel abroad2. The study also shows that 80 % of Europeans will remain in Europe for their vacations whilst 48 % will remain in their own country.

Destinations reporting healthy growth in international arrivals so far in 2010 include Singapore, Turkey, India, China and Australia. According to IATA, in June international air travel was 11.9% up on a year ago, though with sharp regional variations; traffic in Europe increased just 7.8% in comparison to 15.5% in Asia Pacific3.

IATA continues to note that the aviation sector is recovering faster than predicted, especially outside of Europe. Long-haul business class travel continues to outperform non-premium and short-haul traffic.

Within the UK market, the decline in outbound travel by UK residents that was a feature of 2009 appears to show no signs of abating. Figures for the first six

1 Visit Britain Tourism Trends Quarterly August 2010 ‐ http://www.visitbritain.org/Images/TTQ%20Aug10_tcm139‐ 194776.pdf 2 Summer trends Tourmag.com June 2010 3 Visit Britain Tourism Trends Quarterly August 2010 ‐ http://www.visitbritain.org/Images/TTQ%20Aug10_tcm139‐ 194776.pdf

months of 2010 reveal a 10% decline in outbound travel and 5% fall in spending on outbound trips4.

Other factors such as the rise in fuel cost and VAT are expected to contribute to further decline in the UK outbound market. According to a research done by Mintel the increase of VAT from January 2011 and higher fuel costs will make holidays more expensive from next year, which could cause a further dip in the market5.

"Higher holiday prices due to high VAT will hurt the market as the costs of low- cost flights are increased; and "changing exchange rates and higher fuel costs will play a major role in holiday prices in the coming years and higher prices will limit volume growth", says Mintel.

The Caribbean travel industry also faces its own challenges. Visitors from the UK will see a further increase in Air Passenger Duty in November this year. UK arrivals to the Caribbean this year are down by as much as 10%, and on one island by 25%, following the rise in Air Passenger Duty (APD) last November6. The decline is causing alarm as the next APD increase on November 1 will trigger a further dive in the number of UK tourists after a survey found almost one-third of British visitors said they would not return if fares rose too much.

Key Factors Impacting on Tourism • Demand for international air travel in July was 9.2% up on a year ago according to IATA; European carriers continue to lag those in other world regions with growth of 6.2%, by contrast Middle East carriers saw traffic 16.8% up on July 20097 • IATA report that in June business class airline travel increased globally at an annual rate of 16.6%, considerably faster than economy class travel at 9.5% • UK consumer confidence improves marginally during August • Euro zone inflation reaches its fastest rate for nearly two years • Euro zone unemployment remains at an average rate of 10.0% across the 16 country bloc • The European Central Bank ups its forecast for Euro zone economic growth in 2010 to between 1.4% and 1.8% and in 2011 to between 0.5% and 2.3%

4 Visit Britain Tourism Trends Quarterly August 2010: http://www.visitbritain.org/Images/TTQ%20Aug10_tcm139‐ 194776.pdf 5 TravelMole: “Holiday Market will take 5 years to Recover, says Mintel” http://www.travelmole.com/stories/1143890.php 6 Travel Weekly : “Alarm sounded over drop in UK visitors to Caribbean” http://www.travelweekly.co.uk/Articles/2010/09/09/34628/alarm‐sounded‐over‐drop‐in‐uk‐visitors‐to‐ caribbean.html 7 Visit Britain Trends Update 2 September 2010 http://www.visitbritain.org/insightsandstatistics/trendsandforecasts/trendsupdate/tu136.aspx

• Kiss Flights becomes the latest UK based budget outbound tour operator to collapse during the peak summer trading period • The German government has approved an air departure tax that passengers will need to pay from 1 January 2011; the fee will be €8 on short-haul flights, €25 on medium-haul and €45 on long-haul flights

CTO UK ACTIVITIES CTO UK operates a vibrant chapter which currently stands at 98 members. In order to ensure that members are provided with continuous marketing and networking opportunities a comprehensive programme of activities is coordinated annually.

June-September 2010

Dive Guide The 2011 Dive Guide is currently in circulation. It is a 24 page, full colour, glossy guide with information on all 34 member destinations. The cost of the publication was covered through the sale of advertising.

Caribbean Ball The UK Chapter hosted its successful and ever popular annual summer ball, at the five-star Dorchester Hotel, on London’s Park Lane, on Thursday 17 June 2010. Attended by 350 guests, the black tie event began with a Champagne reception, with a steel band. There were four key sponsors this year: Travel Weekly, British Airways, Virgin Atlantic Airways and exposure4. Proceeds from the raffle on the night raised will be shared between The CTO Scholarship Foundation and CTO’s Relief Fund for Haiti.

Online Marketing Seminar The CTO hosted two free one-day online marketing seminars facilitated by Leadgenerators, one of the UK’s leading online marketing agencies, on 15 June and 8 July 2010. The seminars were designed to help members develop stronger and more effective online campaigns.

CTO Charity Golf Day On 14 July the CTO organised its annual golf tournament at the Silvermere Golf Club in Cobham, Surrey, welcoming 60 golf enthusiasts. This year a donation on each ticket sold went to the CTO Haiti Relief fund. Sponsors for the day included Virgin Atlantic and Fotoseeker.

Guide to the Caribbean The CTO UK worked with BMI Publications for the fifth year, to produce the 2011 Guide to the Caribbean. This is a full colour, glossy publication, which

39 was previously 52 pages, but for the 2011 edition, it was increased to 60 pages of information, targeting the UK market, with a circulation of 50,000. The cost of the publication was covered through advertising.

Special Offers Brochure The CTO worked with its members to highlight available special offers for the winter months. An 8 page brochure was produced and distributed to 20,000 consumers and trade, to highlight and promote the Caribbean destinations.

Northern Ball In an effort to promote membership of the CTO UK, the Chapter will have a presence at the Northern Ball. This event, organised by leading trade publication Travel Weekly, will be held at the DeVere Whites Hotel in Bolton and is a key travel trade networking event for the North of England.

CTO UK Chapter Networking Meeting CTO UK Chapter Members will celebrate Caribbean Month at the Commonwealth Club, London on Tuesday 28th September.

Membership update 2010/2011 The CTO UK Chapter has finalised the renewal subscriptions for the 2010- 2011 Membership period. There are currently 98 Chapter members – with 4 new members joining recently.

Courses in the Caribbean – new for 2010 The CTO will move its regular agent training events to the region; it will begin a series of ‘Courses in the Caribbean’ familiarisation trips, which will include a 7 night twin-centre trip to showcase 2 or more of the member countries. The first of these trips will take place at the end of September 2010, travelling to Saint Lucia and Trinidad & Tobago. The group will consist of 14 travel agents with escorts from the CTO and Saint Lucia and Trinidad & Tobago. There are also plans for a Trade Journalist to accompany the group.

Caribbean Training Programme UK travel agents continue to support the Caribbean Training Programme by working their way through the modules to achieve their certificates. The Caribbean Training Programme was revised to coincide with the new and updated TravelFax.

Upcoming Activities October - December 2010

Wedding Shows The CTO will participate in the National Wedding Show, London and the Scottish Wedding Show, Glasgow, in October this year. The CTO will once again launch its annual Wedding & Honeymoon Guide 2011 at the London Show. The Guide will be distributed at all UK Wedding Shows, within goody

bags and from the CTO stand in 2010 and 2011, and also at other upcoming trade and consumer shows.

Top Resa

CTO will be participating in the 32nd edition of Top Resa on 21-24 September and will be sharing a Caribbean stand with Barbados, Cayman Islands, AM Resorts, and Superclubs. Other exhibitors in the Caribbean area include Cuba, Dominican Republic, Martinique, Guadeloupe, Jamaica, Bahamas and Saint Lucia.

Rum & Rhythms The CTO will host its second consumer event showcasing Caribbean cuisine, rum and music at London’s Vinopolis. The event will give visitors the chance to sample a wide selection of Caribbean rums plus a range of gastronomic specialities from 20 exhibiting partners.

The Caribbean renowned Chef Barrington Douglas who has appeared in Gordon Ramsey's 'F-Word', cooked alongside Gary Rhodes in 'Rhodes Across the Caribbean', and has also appeared on Channel Four’s Iron Chef, will be preparing some of the famous dishes served at Discovery Bay, his Caribbean restaurant in Huddersfield.

Ian Burrell, known as the UK’s rum ambassador will coordinate mixology competitions and familiarise attendees on the rums in the Caribbean. Drivetime Presenter, Angie Greaves of Magic 105.4, will MC the evening.

World Travel Market This year at World Travel Market the exhibition centre has increased in floor space and services however, the Caribbean area has been reduced with several member countries not exhibiting this year due to budgetary constraints. 18 Caribbean countries and 8 private sector partners will be exhibiting in the Caribbean area this year.

Dive 2010, Birmingham, UK

The CTO is coordinating a Caribbean Village area at Dive 2010. The Caribbean Dive Guide will be distributed from the CTO Stand.

International Luxury Travel Market (ILTM), France The CTO is currently coordinating a Caribbean Pavilion at ILTM, which it will share with 5 Caribbean industry partners. The exhibitors will meet with key international buyers to showcase their unique travel experiences and luxurious properties.

UK PR Highlights Within the last quarter, BGB has secured British press and helped host press at the CTO sustainable tourism conference in Bridgetown, Barbados. Throughout the year they offer media relations-based support of the CTO's anti-APD campaign, arranging media interviews for Hugh Riley in June and September.

They have secured high profile media for the CTO summer ball; provided support and generated press coverage for the CTO leadership strategy conference with Willie Walsh. BGB has now started preparations for the fifth Caribbean journalism awards (collecting entries and inviting media and assisting with venue suggestions); and also for press coverage of the CTO “Rum and Rhythm” event. They have also provided ongoing press communications support in news releases on the CTO's reaction to the UK budget, the CTO golf day, the race for life and the Rum & Rhythm event.

EUROPEAN ACTIVITIES 2010

The UK office co-ordinates and facilitates activities throughout Europe. The Dutch chapter is managed by Aviareps; INEX Communications handle PR in Germany and representation is provided in France, Italy and Spain by Interface Tourism.

CTO KEY ACTIVITIES IN SOUTH EUROPEAN MARKETS

CTO Roadshows June 2nd and 10th CTO hosted roadshows in Moscow and Oslo in June 2010. The Bahamas Tourist Office, Puerto Rico Tourism Company, Jamaica Tourist Board, Elegant Hotels, Cayman Islands Department of Tourism, Dominican Republic Tourist Board and Virgin Atlantic participated.

Facebook page for French market Interface Tourism France has recently launch a Facebook page to bring the Caribbean front of mind in the French market. The page consists of pictures, news, articles, special offers and videos on Caribbean destinations. Visitors can access the page via the CTO French website.

Newsletter on the French and Italian markets Interface tourism produces a monthly newsletter for the French and Italian markets. The newsletter covers general information, events, special offers on the Caribbean region and features three Caribbean destinations per month. The newsletter is circulated to 6500 tour operators, travel agencies and consumers.

TTG Show, Italy TTG Incontri is the leading trade show in Italy; it provides the opportunity to establish new trade contacts in the Italian market. For the 2010 show, the CTO will have a stand at the show, which it will share with the Saint Martin Tourism Office. The CTO will also coordinate and conduct seminar sessions. Seminars will be coordinated for Martinique, Guadeloupe and Aruba.

HOLLAND

Press lunch in Strand Zuid in Amsterdam. CTO hosted a press lunch in Amsterdam on 27 May. The press lunch allowed CTO members to network with members of the press and discuss ways to increase the publicity of the Caribbean. Following the press lunch, a members meeting was organised, by the CTO Dutch Chapter, to discuss plans for the remainder of the year and how to achieve more economies of scale in the current economic climate.

Bruid & Bruidegom Magazine CTO Holland participated in a Bruid & Bruidegom Magazine feature. This magazine has a circulation of 39,600 and is distributed four times per year. The magazine has promoted tropical destinations and some of our members were included.

Caribbean Village at the 50Plus fair in Utrecht Following the previous success of the annual Holiday Fair Vakantiebeurs, CTO Chapter Holland is organising a Caribbean Village on the 50 Plus Fair. The Fair is aimed at seniors over 50 years of age and will take place at the Jaarbeurs Utrecht from 15 -19 September 2010.

CTO Caribbean Trade & Press Event: ‘Discover the Caribbean feeling’ This event is scheduled for October 6 2010, and will include training sessions for travel agents and a workshop for press. The Caribbean Travel Writers Award 2010 will also be announced at this event.

GERMANY

Management of CTO’s German website INEX Communications content manage the CTO German Website www.Karibik-Info.de. Regular content management activities are: updating of press releases, travel trade news, TV-programme, special offers as well as sending updates on Facebook and Twitter. Additionally INEX has been producing and mailing a monthly consumer newsletter to 2,300 subscribers.

Banner Advertisements and Affiliate Programme In April/May INEX sold the first banner advertisement on the website to Puerto Rico TB. We also joined the Zanox affiliate programme (www.zanox.de) giving us the opportunity to generate additional revenue. As a result we implemented several affiliate links (Condor, Air Berlin, Amazon) on the website in June.

Booking Engine In co-operation with online travel broker Opodo, INEX implemented a booking option on landing page and navigation of secondary pages that is exclusively focusing on the Caribbean. While choosing a preferred destination the user gets several offers from various tour operators.

Consumer competition In June INEX launched a new consumer orientated competition in co-operation with tour operator Meier’s Weltreisen (REWE Group) running until November 2010. As of August 20 2010, 1,742 participants have subscribed including 595 that have requested the monthly CTO newsletter and 535 that asked for additional information on the Caribbean product of Meier’s Weltreisen.

B2B email-marketing-project INEX Communications launched an email campaign to 38,000 travel agents and tourism professionals. In co-operation with the leading German information broker for travel trade (www.touristikernet.de), INEX prepared and sent an html newsletter with the aim of increasing traffic on karibik-info.de. The newsletter included information on flight and ferry schedules, tour operators and a trade news section. The trade news section included a link to a holiday competition for travel agents only. The price (1 week for 2) was sponsored by Condor and Almond Resorts, Barbados.

Print publication Caribbean Magazine The annual edition of “Karibik Magazine” is to be published in November 2010. The new 48-page magazine will have a print run of 192,000 copies, and will be distributed as a supplement in two German and one Austrian travel magazine .

German PR Meeting In July CTO and INEX invited all partners (tourist boards, PR agencies, hotel, airline and tour operator representatives) to a German PR meeting in Frankfurt. A presentation was given on marketing activities in the German market.

HIGHLIGHTS FOR 2011 WORK PLAN These are the main programmes proposed for 2011:

UK and Ireland Holiday and Travel Show Manchester The Holiday World Show Dublin Destinations London London International Dive Show The Wedding Show Ireland National Wedding Show London DIVE 2011 World Travel Market

Europe Vakantiebeurs Holland FITUR Spain Matka Finland Brussels Holiday show BIT Milano ACTS Europe ITB Germany TUR Sweden European Roadshow TTG Italy ILTM France

UK Chapter New Members Drive Northern England Networking Event AGM Summer Ball Charity Golf Day Media Networking

Special Events Caribbean Wedding and Honeymoon Showcase

Travel Agents Courses in the Caribbean Destination Master Classes

APD Lobbying

Publications 2012 Guide to the Caribbean 2012 Wedding and Honeymoon Guide

2012 Dive Guide

Caribbean Month Special Offers Flyer Radio / TV Promotion Rum and Rhythm