Catalysing Travel and Tourism in Asia A TravelRave 2015 Report Catalysing Travel and Tourism in Asia Foreword

TravelRave Provides Key Insights of Asia Opportunities for Industry in Transition Into its 6th year, TravelRave 2015 saw some over 11,000 TTG Asia Media is proud and privileged to partner the travel industry leaders and professionals from around Singapore Tourism Board (STB) for a second year to the world descend in Singapore from 19-23 October. produce this report. The Asian Business Travellers Report, a Singapore TravelRave, spearheaded by STB, is regarded as Tourism Board (STB) commissioned research in Asia’s premier travel and tourism week. Once again, it partnership with McKinsey & Company, Amadeus and provided thought leadership on what is shaking up the Visa was also released during TravelRave. industry and how leisure, MICE, China and business STB, together with TTG Asia, are happy to share travel are being affected. the highlights of original research findings and key This year’s line-up of stellar speakers and insights featured across TravelRave 2015 events, that panellists spoke about an industry in transition, will help the industry hone strategies to tap into the the disruption to businesses and the different burgeoning opportunities in Asia. opportunities that have emerged. With Singapore’s international appeal, strategic They presented a landscape of how online travel location and access to key Asian markets, we are and technology, economic and social integration well-positioned to serve as a regional hub and and the growing power of business travel in Asia, thought leader for the region, providing synergies including China’s MICE market, and the crucial role of across content, markets and networks for business women in the workforce shaking things up. delegates. I hope this report provides invaluable insights to Come 2016, Singapore continues to host a year- you and your business. long line-up of exciting travel and tourism business events and we look forward to your participation.

Andrew Phua Michael Chow Director, Exhibitions and Conferences Travel Trade Publishing Group Publisher Singapore Tourism Board TTG Asia Media

CONTENTS

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Event Trending at Online Asian China Human TravelRave Highlights TravelRave Travel & Business MICE Capital & Partners Technology Travel Future Leaders

2 Catalysing Travel and Tourism in Asia E v e n t highlights

TravelRave 2015 Catalysing Travel and Tourism in Asia

TravelRave once again provided an invaluable platform for industry professionals to gain strategic knowledge, and for thought leaders to exchange insight into the region’s multi-faceted environment. Travel buyers were also able to explore and discover exciting products Asia has to offer and travel suppliers were able to introduce interesting new developments. Singapore’s role as a key MICE hub continues to expand. Spearheaded by the Singapore Asia Travel Leaders Summit Hotel Management Singapore Summit Tourism Board (STB) with the The annual Asia Travel Leaders Summit New at this year’s Hotel Management support of its many partners, (ATLS) continued to focus on three Singapore Summit were a productivity TravelRave’s concentration of key content pillars, namely consumer, technology showcase session, an owner’s business events also provides innovation and talent to culminate in tangible dialogue session and the introduction of a new ample opportunities for attendees collaborative initiatives for the region. For interactive Q&A webapp. 2015, a macroeconomics new pillar — The productivity technology showcase to connect with industry leaders, re- particularly on economic developments and featured practical case studies and solutions establish and expand their network greater economic cooperation in South-east to help hoteliers boost efficiency and of contacts. Asia — was included in light of the ASEAN overcome the manpower crunch, the owner’s Following are the week’s event Economic Community launch in 2016. dialogue focused on bridging the gap between highlights. Top Asian and international travel and hotel owners and general managers, and the tourism captains of industry gathered again at Q&A webapp empowered delegates to raise the sixth edition of ATLS to inspire purposeful sensitive questions anonymously. dialogue in response to key issues facing the Part of the Hotel Management Asia industry. Summit series, the Singapore event is aimed This by-invitation event is an intimate at sharing success stories, exchanging best discussion among 30 to 40 eminent business practices and resolving controversies in a leaders who have strong interests in the neutral, closed-door environment. development of the travel and tourism The year’s summit centered on major industry in Asia, and seeks to help lay the issues that would have a significant impact on foundation for collaboration and initiatives in profitability. response to the key issues discussed. STB continued its partnership with Visa Worldwide and Google on the consumer and innovation pillars, and forged a new partnership with Amadeus Asia Pacific, allowing the summit to generate original insights into Asian business travellers. The summit also featured a lunchtime dialogue with Christoph Mueller, CEO, Malaysia Airlines, about the airline’s future direction and plans.

3 Catalysing Travel and Tourism in Asia E v e n t highlights

TravelRave 2015: Catalysing Travel and Tourism in Asia

Hotel Technology Conference ITB Asia RaveOn! Tours

Billed as the Trade Show for the Asian Travel The 2015 Hotel Technology Conference (Hotel This year’s RaveOn! Tours presented an array Market and launched in 2008, the three-day Tech) incorporated more interactive features of authentic local offerings and experiences. event held at Sands Expo and Convention than ever before with roundtable discussions Whether guests were a museum fan or a Centre, Marina Bay Sands attracted close to and a real-time Q&A webapp. cultural junkie, there was something catered 10,300 attendees from 108 countries. By empowering the attendees to ask for everyone. There were 760 exhibitor organisations the questions that are important to them, they On the Arts & Architecture tour, from 73 countries, 880 buyers and more than were able to influence the direction of the delegates were taken to the new National 4,710 minutes of high-powered conference discussions and extract the insights they need Gallery Singapore and the newly refurbished content. from expert speakers, while the roundtable Victoria Theatre & Concert Hall. They enjoyed Reflecting the growing importance of discussions provided the opportunity to crowd a drive through of the museum precinct the online travel space, keynote panellists this source ideas and best practices from peers, and had cocktails at The South Beach­­ — a year included executives from Tuniu, Ctrip, on practical and controversial subject matters. luxury and lifestyle hotel of design. The Airbnb, Agoda, Expedia, TripAdvisor, Uber, In partnership with Savioke, Relay by tour showcased local architecture and Venture Republic Global and MakeMyTrip. Savioke – the acclaimed robot that delivers conservation, new developments and art/ ITB Asia’s comprehensive conference amenities efficiently – made its Asian debut. sculpture installations in the city. programme included presentations Delegates were able to interact with Relay and On the City in a Garden tour, delegates by GfK, STR Global, Google and other see the future of “frontline staff” in action. visited the Singapore Botanic Gardens and leading companies on current trends and By showcasing pioneering solutions Capitol Singapore. This was to highlight the opportunities, as well as a panel discussion such as Relay, highlighting local innovations recent UNESCO heritage title bestowed on with the Singapore Tourism Board (STB) and and discussing challenges with a problem- the former and the greening effort in the leading Chinese players to highlight China’s solving approach, hotel technology and city. The tour of the redeveloped and newly growing importance in the travel industry. operational leaders were able to candidly opened Capitol Singapore, a prime lifestyle In new partnerships, CAPA – Centre share their experiences and envision the conservation example, included dinner at for Aviation launched the inaugural CAPA future. local food outlet Palette, a site inspection of Aviation Outlook forum, while DestinationElite Capitol Theatre and a Deepavali Light Up drive organised the show’s first Luxury Travel & through at the nearby Little India precinct. Hospitality Forum. In furthering the MICE partnership with K.I.T Group, the focus this year was on Asia’s association landscape, while a dedicated Incentive, Conference and Event (IC&E) conference was held in partnership with the Incentive Conference and Event Society Asia Pacific (ICESAP) featuring buyers and intermediaries from the IC&E space as key speakers.

4 Catalysing Travel and Tourism in Asia E v e n t highlights

TravelRave 2015: Catalysing Travel and Tourism in Asia

2015 Singapore Experience Awards TravelRave Leaders Gala Web in Travel

TravelRave Leaders Gala – a gathering of the Web in Travel (WIT), launched in 2005, is There were 80 finalists across three award Who’s Who in travel – was held at the newly the longest-running event for executives categories of Customer Service, Experience revamped Capitol Theatre, after the historic discussing matters relating to technology in and Marketing & Media, and 27 outstanding individuals and organisations were building reopened its doors earlier this year. the travel space. The Singapore Tourism Board (STB) partnered Reboot was the 2015 WIT central recognised and honoured for their passion all the dining establishments at the Capitol theme and was aimed at promoting fresh and dedication in delivering extraordinary Piazza to serve each outlet’s specialty dishes thinking on changing customer behaviour and experiences. to more than 300 C-suite guests, providing the rapid pace of technology changes. Singapore Minister for Trade and them with a gastronomic experience for the Key speakers included senior regional Industry (Industry), S Iswaran was the guest- evening. executives from booking companies Agoda of-honour and he presented the awards at the The gala celebrates the extraordinary and Skyscanner, GDS companies including ceremony held at the Raffles City Convention achievements made by the Asian travel and Sabre and Amadeus, ground services Centre. tourism industry and serves as a platform operators Uber and GrabTaxi, hospitality Two individuals and two organisations to share the insights that were discussed companies Airbnb, InterContinental Hotels were conferred top honours under the during the Asia Travel Leaders Summit with a and HomeAway, companies that offer Outstanding Contribution and Special wider audience and to present CNBC’s Travel experiences such as Rakuten, TripAdvisor and Recognition award categories. Business Leader Award. MakeMyTrip and airline Scoot. The Lifetime Achievement for The gala also provides an opportunity for This year’s conference attracted 550 Outstanding Contribution to Tourism was industry leaders to expand their network and participants, 100 speakers from 33 countries presented to May Sng, former chairman of exchange insight on the leading trends of the and the opening keynote was delivered by the Orchard Road Business Association for travel and tourism industry. Vivian Balakrishnan, Singapore’s Minister for her significant contributions towards the During this celebratory evening, Foreign Affairs and Minister in-Charge of the development of the Orchard Road precinct. George Tanasijevich, President and CEO of Smart Nation initiative, coordinated by the Sing Mong Kee, former president of Marina Bay Sands, gave an exclusive interview Smart Nation Programme Office in the Prime the Intelligent Transportation Society of in the CNBC In Conversation session, and Minister’s Office. Singapore, was named Best Business Event Lee Seow Hiang, CEO, Changi Airport Group The pre-event 2015 WIT Boot Camp Champion for his role as a MICE ambassador was also presented with the CNBC Travel saw aspiring and current entrepreneurs, who championed and secured the rights for Business Leader Award. travel professionals and investors showcasing Singapore to host the Intelligent Transport This year’s gala also witnessed the book the latest trends redefining the digital travel Systems World Congress (ITSWC) 2019. launch of Planning for Tourism – Creating a space. In the Special Recognition category, Vibrant Singapore, jointly produced by STB Start-ups such as Rome2Rio and the Breakthrough Contribution to Tourism and the Centre for Liveable Cities. The book Travelstart shared their stories on how they award went to the BNP Paribas WTA Finals documents the development of Singapore’s built their businesses, while market experts Singapore presented by SC Global for tourism landscape, recounting major from Phocuswright provided key insights into augmenting Singapore’s reputation as a key challenges faced by the sector at each phase relevant travel markets and segments. sporting destination. of growth, and how key policies and decisions As the Best Healthcare Experience in urban development planning have provided recipient for three consecutive years since much needed boosts to tourism development. 2013, Mount Elizabeth Hospitals took home the Exceptional Achievement award.

5 Catalysing Travel and Tourism in Asia Trending

TravelRave 2015 Industry in Transition – Disruption and Opportunity This is a summary of the key online travel and technology trends which emerged from events this year

Mobile first or Outsiders are taking a bite OTAs are mobile only? Alitrip – the brainchild of online marketplace redefining what Industry stalwarts giant Alibaba – is creating an ecosystem that they do are now asking – is is envisioned to give online travel agents OTAs are starting it time to go mobile (OTAs) a big run for their money as they dig to look beyond their only or mobile first? their tentacles deeper into online travel. well-defined cache This is a question Rakuten Travel, an offshoot of Japanese of flights and hotels. many are pondering, online marketplace Rakuten, is looking to Holiday rentals, particularly when it complex data algorithms based on its customer tours, activities, comes to developing management systems to match users to hotels. restaurants and native apps, as their even B2B solutions share of the market for independent comes under siege. hotels are now being unveiled. Some observers fear that this might dilute the OTA’s core capabilities; but others are Extension Expansion more optimistic, citing that these developments are just a natural progression.

Meta search Evolution continues to crash in on the OTA party Meta search engines were built to cream the less lucrative top of the travel search funnel but they now see themselves as marketplaces, and Hotel brands The shared It is a whole Distribution of Loyalty through are going beyond are innovating economy new ballgame content big data their traditional Monetising the ecosystem Technology is The rise of user- On a broader function as price- webspace is The shared being used in generated content scale, established comparison sites becoming a reality economy – led ingenious ways (UGC) will not end players will have and are turning into for key brands. by Airbnb and to enhance the anytime soon. to relook how they quasi booking sites. A first has been Uber – is taking travel lifecycle. The There is a real can harness their achieved by Accor, on a life of its travel technology hunger for relevant big data to reward which is intent on own. Enterprising landscape is information, and their most loyal transforming its individuals are now embracing radical for authentic and customers. It is a online reservation creating a host new players while compelling stories game of giving the space into a of B2B spin-off established players that lets a brand right rewards to marketplace for businesses that are rebooting their speak of its values the right people, at independent as enhance the entire business. and goals. the right time. well as its own guest experience. properties.

6 Catalysing Travel and Tourism in Asia Trending

TravelRave 2015: Industry in Transition – Disruption and Opportunity

Frontiers in Focus

Asia becomes the world’s Business travel and MICE Human capital development largest travel region activity soar

Peace, urbanisation and open skies are A 2015 landmark survey4 shows China Gender parity in Asia has the opportunity to among the factors stimulating economic chalking up a whopping meetings spend of increase GDP by between 5% and 12% in a growth and the rise of secondary cities in India US$110 billion in 2014. “business-as-usual” scenario. and China – where the development of hi- The survey further adds that the Women’s contribution to GDP is 41% in speed rail networks is expanding – is opening meetings spend is 45% of all business travel China, and 34% in East and South-east Asia up new business opportunities. spend in China. compared to a global average of 37%3. India, with a US$2 trillion1 economy, is The hubs of MICE activity, concentrated This research by McKinsey & Company the “star child”, and it will be the fastest growing in three cities in China — Shanghai with a shows businesses stand to gain both economy in the world in the next five years. 27% share, Beijing 25% and Guangzhou 24% individually and collectively if the gender gap Business travel spend in Asia now — are responsible for generating 76% of the is narrowed and there is strong correlation makes up 38% of the global business travel country’s MICE activity. between the proportion of women on executive market, which is worth more than US$1 Manufacturing tops the MICE charts committees and a company’s financial trillion2. and based on total Chinese MICE spend by performance. Annual business travel spend in China sector, manufacturing – accounting for US$59 Meanwhile, a look into how companies since 2005 has increased 400%. In 2014, billion – blazes a trail. This compares to the prepare for succession has revealed that business travel spend of US$288 billion put spend by the utilities sector in second spot at many treat it as an abrupt event trigged by the US in top spot followed by China with only US$13 billion and agriculture, forestry the departure of the old CEO, rather than a US$262 billion. By 2019, China’s figure is and fishing in number three spot with US$5 structured process. forecast to jump to US$420 billion compared billion. Many companies, according to to US$349 billion for the US. McKinsey & Company, also focus on selecting In 2014, India with business travel spend a supposedly ideal CEO rather than asking of US$26 billion was ranked in 10th spot. It is what is the right CEO profile given the forecast to jump to sixth position by 2019 with priorities ahead. spend going up to US$45 billion. Lastly, TravelRave 2015 also provided Expectations of the Asian business students and industry leaders a platform to traveller for digital experiences are being discuss the career opportunities within the shaped and heightened by their everyday tourism and hospitality industry. consumer lives and online bookings and the use of self-booking tools are becoming dominant. Asians are also twice as likely to make a booking that includes a weekend, compared to Europeans, and 81% are willing to extend their business trip for leisure3.

1 Global Business Travel Association 4 Market Assessment of MICE Business Travel in China 2 GBTA BTI Outlook – Annual Global Report & Forecast: conducted by the GBTA Foundation and sponsored by Prospects for Global Business Travel, 2014-2018 Starwood Hotels and Resorts 3 McKinsey & Company

7 Catalysing Travel and Tourism in Asia ONline travel & technology

Travel Technology – Expansion, Extension and Evolution he travel industry is at a turning point. “Many companies are Technology is transforming lives at a Trapid pace and is opening up business focused on developing a opportunities as well as man-machine interactions that were virtually unthinkable in digital strategy when they the past. should instead focus on Within online travel distribution, stalwarts and newbies alike will have to look closely at integrating digital into all this ever-evolving sector and weigh up the aspects of the business, potential risks and rewards. It is a winner takes it all game and there is no respite from channels and from this race. It is important to stay on top of trends and to constantly innovate, while processes and data to the developing tangible long-term and short- mobile spheres. Voice of customer (VOC) term initiatives that bring value to customers programmes encompassing tools such operating model, incentives, and which also add value to the company – be as guest surveys, analysis of social media it in terms of financial revenue, credibility or postings, diving into user generated content and culture. Our analysis brand equity. (UGC) and email queries are gaining traction, enabling firms to evaluate and quantify their of how companies with a Having a digital strategy is a must for any service points, and to pinpoint opportunities high digital quotient (DQ) organisation bent on conquering the online to up-sell and cross-sell products as well as arena. Harnessing big data and using it as to create relevant content. operate shows that 90% of a basis for customer and business analytics to optimise content and marketing plans is In 2015, all technology trends point to the top performers have fully now imperative. Without a digital compass, streamlining of the guest experience from companies will inevitably be left behind. start to finish. Providing customers with a integrated digital initiatives Firms have to be agile and work with ever- seamless, convenient and intuitive service, changing variables, including the perception to inculcate loyalty and to carve a distinct into their strategic-planning of value by the consumer, user expectations, identity in an incredibly crowded market is process.” as well as online marketing technology, now paramount, and it is what separates an particularly those spanning the social and exceptional player from a mediocre one.

The world is becoming ever smaller with technology acting as a platform facilitating relationships in virtual spaces, in spite of geographic distances as Alex Dichter well as political and social barriers. Director McKinsey & Company

8 Catalysing Travel and Tourism in Asia O n L I n e tra v el & technology

The Sharing Economy

e now live in a world where the biggest accommodation provider Whas no real estate1, the world’s most UP CLOSE AND PERSONAL valuable retailer has no inventory, the world’s largest taxi company owns no vehicles and where the world’s most popular media owner An Interview with does not create any content. Julian Persaud Regional Director The sharing or peer-to-peer (P2P) economy Airbnb Asia-Pacific is here to stay, and it will continue to infiltrate the digital landscape, acting as a transactional What has the impact of Airbnb been on trip – discovering unique locations for buffer between individuals, connecting both the Asia-Pacific region in the last two to temporary housing and team offsites, the virtual and real world. three years? Do you see Airbnb evolving where a relaxed and friendly environment Relationships now extend beyond commercial into a different model in Asia? provides an opportunity to build closer suppliers. We can now tap into the resources We have been a global platform since working relationships. individuals own at the touch of a button. 2008 but Airbnb’s growth within Asia Pacific really took off in the last three There are now more than 1,000 The rise of innovative P2P online years. As our fastest growing region – a businesses from over 35 countries marketplaces will continue to disrupt leisure growth of 240% outbound and 380% around the world, including companies travel. Although it is still in its infancy inbound last year – Airbnb has certainly like Soundcloud and Google, which are stage, companies such as Uber and Airbnb found its footing here. formally making Airbnb part of their are expanding into business travel, giving corporate travel programmes. Within traditional corporate travel management Our expansion has certainly increased the first 24 hours of its global launch, companies a run for their money. conversations around the sharing more than 500 companies signed up for economy. One thing that stands out the Airbnb for Business programmme. However, in order to remain successful, firms is how governments in the region are This suite of travel management tools in the sharing economy will have to continue becoming increasingly progressive. They allow business travellers to book Airbnb to grow their credibility by focusing on the understand the model and are trying to accommodations directly and provide host-guest dynamic. learn more about how to create fair and travel managers visibility into employees’ progressive rules for home-sharing to travel itineraries, financial reporting data Younger people, who are more inclined to benefit their cities. and centralised billing for the optimum opt for shared economy alternatives, are business experience. savvy consumers. Hence, they prefer brands On our part, we are 100% committed that are authentic, honest and which provide to being constructive partners with As we expand our corporate travel a seamless experience at all stages of the regulatory agencies and policy makers. footprint in the region, it is important online funnel. In addition, having a seamless To best partner with governments, we for us to understand the Asian business mobile interface will continue to play a released the Airbnb Community Compact, traveller and how we can help them critical role in keeping people logged into which is based on our core principles, belong anywhere, even while travelling for P2P networks. with three commitments to help ensure work. On the back of this, our business home-sharing continues to make travel product is translated into 26 Most of the giants in the P2P sector are able communities stronger. This is one of the languages to support a global audience. to meet this premise. But can other online many ways we are evolving to suit each travel distributors match their technology and region’s needs as we ramp up supply What plans do you have for the near their tenacity? efforts in Asia-Pacific. future? We are gunning for growth on the mobile Airbnb has made the leap into corporate front as Asians are becoming increasingly travel, so what are your plans in Asia? mobile-savvy. The Asian region alone has What have been the main challenges in seen a 60-time growth in mobile bookings setting up this new initiative? over the last two years and one third of all Business travel is becoming less about bookings from Asia came in via localised being a road warrior and more about mobile platforms. On top of tablets and “b-leisure”, or “biz-cation”. People are mobile phones, we have also introduced combining business trips with weekend the Airbnb app for the Apple Watch. stays and Airbnb’s diverse offerings become a great fit for them. These travellers can also redefine their business 1 Airbnb now lists almost two million homes in 34,000 cities in over 190 countries as of December 2015.

9 Catalysing Travel and Tourism in Asia O n L I n e tra v el & technology

CASE STUDY Uber – The Transportation Game Changer “What we need to do as a

Photo: Uber Photo: disrupter is to define what our goals are, and how our goals align with that of government regulators.”

Chan Park General Manager, South-east Asia Uber sia has been an extraordinary success One of the biggest barriers to Uber’s ambitious story for Uber since its inception in expansion plans is governmental resistance, ASingapore back in 2012. Since its launch, due to a number of legal and taxation issues Uber has planted itself in 70 cities across its business model raises. Uber is currently in Asia, with the bulk of future growth forecast talks with various officials across Asia in the deriving from the economic giants of China hope that they would amend vehicle licensing and India. Uber appoints local operation teams regulations to allow it to carry out its strategies to manage and grow its driver base as part to fruition. of its plans to entrench itself in Asia-Pacific. These teams also work closely with US-based Uber has also dived headlong into corporate research and development engineers to travel with the introduction of its Uber for develop localised solutions. For instance in Business product. This solution allows travel Vietnam and India, Uber passengers can use managers to manage business travellers cash to pay drivers, which differs significantly remotely, enabling them to track expenditure from its original payment model that relies and to ascertain compliance. So far, small and solely on credit cards. medium-sized enterprises (SME) have been their earliest adopters according to Uber.

Infographic Top Countries Slovenia Bulgaria Open to the 86% 79% China Sharing % India 94 Economy Hong Kong in 2014 78% 78% Mexico Brazil % The 79 % Philippines 78 Thailand Indonesia Percentages represent consumers’ % % 85% willingness to participate in a 84 87 sharing economy. Source: Skift 2014

10 Catalysing Travel and Tourism in Asia O n L I n e tra v el & technology

Hyper-personalised Products

he power of technology is enabling CASE STUDY companies to personalise products and Tservices in real-time. Customers can Alitrip – A New Contender now be targeted more accurately with their behaviour and lifestyles. The standalone travel service platform of e-commerce giant Alibaba is actively pursuing the emerging wave of young, highly-educated, affluent and tech-savvy independent Chinese travellers. Analytics is now a big part of this picture and retailers, who have led the way in the application of this advanced matchmaking technology, are now leveraging their “We develop products that storehouse of in-depth customer details to give Chinese travellers a pivot into other spaces including travel and hospitality. seamless experience. As a Analytics is proving to be the primary catalyst consumer and data-driven for change in the travel industry today. Real-time analytics, predictive analytics and C2B platform, we have artificial intelligence (AI) can be integrated to give guests a hyper-personalised experience. created our own ecosystem, AI is uncanny as it has the ability to create structure from disparate bits of information as well as innovative making them well-suited for applications proprietary products which that address the initial stages of trip planning – research and inspiration. The analysis of Travel is a natural extension for the Alibaba are facilitated by strategic customer behaviours and profiles on the Group and in 2014, it served 50 million other hand leads to more adept marketing supplier partnerships with Chinese travellers. It currently offers two decisions. million products that cater to every stage hotels, airlines and travel of the trip lifecycle. Big data accumulated from the Alibaba Group’s activities is used agents.” to help partners tailor products to fulfil specific customer needs and to develop highly targeted marketing initiatives. In October 2015, Alitrip launched Local Expert, an advisory platform that links consumer queries to travel experts and providers. Earlier in the year it released Post Post Pay which allows guests to reserve rooms through Alitrip without paying a deposit and to enjoy express check-outs. Sherri Wu Chief Strategy Officer D I D Y O U K N O W ? Alitrip More than 70% of Alitrip’s bookings are derived from mobile devices. Source: Alitrip

11 Catalysing Travel and Tourism in Asia O n L I n e tra v el & technology

Online Travel Market – Reboot uppliers – airlines, hotels, global distribution systems (GDS), ground transportation providers and travel agents – are not keeping still. They know that travellers want to be empowered and are keen to have more choice and control over all aspects of the travel process. Technology is letting Scompanies meet and even exceed this need. Here are the four key trends1 that are reshaping the entire online travel market:

trend 1 trend 2 trend 3 trend 4 Placement and positioning Data analytics Product diversification Aggregation • More companies are developing • Data and market intelligence now • Online travel agents are looking • Larger travel and hospitality products and services targeted power business strategies and to generate revenue from firms are assimilating smaller, at each stage of the trip lifecycle decisions. alternative sources such as nimble technology-based – from planning to booking, to table reservations, activities and companies, leveraging their • Ultimately, this creates unique, travelling and after the trip. vacation rentals instead of relying expertise to attain market localised ecosystems that solely on traditional revenue leadership. • This strategy enables firms to customers can tap into and firms streams such as bookings and monitor and monetise each can use to secure loyalty and advertising. step of the (online) funnel, long-term sustainability. augmenting the bottom line.

Search and Social CASE STUDY AccorHotels – Search engines and social media are Online Travel now well-established tools employed by Bookings A Daring Digital Strategy consumers for inspiration and information in China via during the trip planning stage. Word-of-mouth In September 2015, AccorHotels took the unusual step to feature recommendations still play an influential role Mobile Source: PhoCusWright2 select independent hotels alongside its own portfolio powered by in travel decisions. However, more and more Fastbooking, a B2B hotel tools provider it acquired in April 2015. individuals are relying on social media channels Hotels in France, Italy and Spain have signed up to this new online for recommendations, instead of having one-on- marketplace, alongside properties in Singapore and Bangkok, with a one conversations with friends and family. Once pipeline of 500 hotels from these five markets expected to be added people receive passive inspiration and cues from by year-end. AccorHotels intends to expand this scheme to 10,000 social media sources, they go back to search independent properties worldwide by 2018, thrice the number of its engines such as Google and Baidu to actively current inventory. hunt for in-depth information. Video content is becoming increasingly 75% 56% “Online travel agencies act as important, giving consumers a feel of a 2017 2015 destination while permitting brands to carve a distributors; we are hoteliers first and clear, distinctive message and to stand out in a crowded marketplace. Share of Mobile foremost and our value preposition (Smartphones Facebook’s Simrat Sawhney, Head of Client and Tablets) for our new (digital) strategy is that Partnerships, South-east Asia, emphasised that Bookings the (independent) hotels we select are organisations are using videos more creatively to Globally share their brand story. At the same time, they Source: Skift3 vetted by us.” are integrating other interactive page elements such as gif.images which do not take up much 27% data bandwidth into their social media content.

More importantly, social media has become a rich and pliant source of data for companies, providing managers with invaluable insights into consumer interests and behaviour.

Romain Roulleau Senior Vice President, Digital & E-Commerce AccorHotels 1 Web In Travel conference at TravelRave 2015 2 China Online Travel Overview, Eighth Edition, July 2015 3 Charts That Show Mobile Booking’s Gain on Desktop Around the World, September 2015

12 Catalysing Travel and Tourism in Asia O n L I n e tra v el & technology

CASE STUDY Local Measure – Enhancing the Chinese Visitor Experience Making Sense of Social Media Australian-based start up Local with Digital Tools Measure has ambitious plans to shake up how hotel companies harness social As part of its wider strategy to draw more “Mobile technology has enabled media data. Their solution scans social Chinese visitors to Singapore, the Singapore media conversations on platforms Tourism Board (STB) has devised a digital us to bundle compelling offers, including Facebook, Twitter, Instagram, marketing framework aimed at delivering an user-generated stories and new Weibo and Foursquare at a specific enhanced online experience for both potential location, instantly identifying what and actual Chinese visitors to Singapore. This developments, and to bring people are saying about a property new integrated suite of digital and mobile them to emerging markets or brand. services was developed in partnership with in China. Essentially, this four prominent players in the Chinese online “Our technology allows travel sphere — Alitrip, Tuniu, Dianping and new alliance delivers a better hospitality and tourism clients Mafengwo — and is targeted chiefly at free, experience for Chinese visitors – independent travellers. These partnerships to get real time guest feedback will enable STB to engage these digital- pre, during and post-trip.” and drive loyalty and savvy visitors at various points, from the trip guest advocacy.” planning stage, right to the point where they share their post-trip stories.

At the same time, STB also launched a new YourSingapore WeChat Service Account and Baidu Connect service that will provide Chinese visitors with real-time location-based mobile services. Attractions such as Gardens By the Bay and River Safari will be featured in Edward Chew the YourSingapore WeChat account, which is Regional Director, Greater China Singapore Tourism Board Gary Spero equipped with audioguides and maps. Vice President Local Measure

CASE STUDY Savioke – Relay the Robot “Our robot provides a consistent — and what we term as a Photo: Savioke Photo: stress-free — experience. For example, if there is a female guest travelling solo, she will feel more comfortable opening the door to a robot rather than a person.”

Savioke’s robot takes the pain out of mundane Relay currently operates in five hotels in tasks for busy hoteliers, particularly for Silicon Valley and one in Los Angeles with two Steve Cousins the Housekeeping and Room Service more hotels in the pipeline. It was very well CEO Departments. The robot acts as a silent received at the Hotel Technology Conference Savioke bellhop, delivering food, toiletries, towels, at 2015 where it made its Asia debut. the request of guests and staff.

13 Catalysing Travel and Tourism in Asia O n L I n e tra v el & technology

Mobile Continues to be a Catalyst for Strategic Change

obile continues to be the biggest disrupter for the travel and hospitality Mindustry. Indeed, it is imperative that companies invest in mobile channels as the Japan importance of the mobile experience has long China surpassed that of the desktop experience. 52 Design, functionality and real-time responses 526 63 S. Korea all play crucial roles in delivering a mobile 688 34 experience that fosters brand loyalty and India evangelism. 37 168 Vietnam Discussions among industry experts at the 317 21 Web In Travel conference at TravelRave 2015 suggest that a significant number of 35 Thailand travel and hospitality companies in Asia are still coming to grips with the burgeoning 18 Philippines number of consumers migrating to mobile. 25 26 Anecdotal evidence also shows that there 39 is some inertia to creating native apps that Malaysia feed into integrated customer relationship 10 management systems owing to both time and cost constraints. 14 Singapore Mobile first Designing for mobile is a hard, arduous task. country in Mobile consumers want the essentials of 4 Indonesia 3Q2015, in terms whatever they are looking for instantly. Things 5 Australia of travel-related 55 queries on that prolong their search or give them extra 15 Google Search hassles will quickly lead to them ditching a 92 mobile service or app, undermining a brand’s 17 value. On a brighter note, if companies get Smartphone users (Millions) it right, consumers are generally quick to spread the word around. Simplicity and 2015 consistency are key. In the last 12 months, 2019 forecast the phrase “mobile first” has become the new mantra for digital channel design. For the Source: Global Mobile Landscape 2015, eMarketer, Google data travel industry, given current mobile growth rates, it is not too far from “mobile only” becoming a reality. O n the hori z o n Going mobile is a long-term investment, and some key players such as MakeMyTrip have Wearables swallowed up smaller mobile technology Apple Watches and other similar devices with specialists to enhance their own mobile DNA. apps provide real-time travel information. Others have gone mobile first, especially those targeting China and Indonesia. Augmented/virtual reality With this technology, users can observe a Mobile Use Comparison (2014) scene through a phone camera or on devices, Use of Smartphone When Booking a Hotel or Flight such as Oculus Rift, that are facilitated by relevant facts from the Internet.

China USA Brazil Beacons When installed, beacons can detect the location of nearby beacon-capable 53% 18% 27% smartphones, collect location data, and send personalised travel information.

Source: PhoCusWright

1 Search, Shop, Buy: The New Digital Funnel, PhoCusWright, Special Project, June 2015

14 Catalysing Travel and Tourism in Asia Asian Business Travel

Asia Becomes the World’s Largest Business Travel Region usiness travel spend in Asia now makes Business Travel Spend and Global Ranking of Key Asian Countries up 38% of the global business travel (Billion US$) Bmarket, which is worth more than US$1 $420 trillion, according to the GBTA BTI Outlook – 2014 2019 Global ranking Annual Global Report & Forecast: Prospects for Global Business Travel, 2015-2019. $262 Shared at ITB 2015, the report found that the business travel market is being led by China, where annual business travel spend has increased 400% since 2005. In 2014 China’s business travel spend of US$262 billion put 2 1 3 4 7 8 10 6 16 12 it as the world’s second biggest behind the $62 $69 $32 $39 $26 $45 $16 $27 US with US$288 billion. But by 2019, China’s figure is forecast to jump to US$420 billion compared to US$349 billion for the US. China Japan South India Indonesia Korea With the Chinese government’s policies centred on maintaining moderate economic Source: Global Business Travel Association (GBTA) growth, reducing local government debt and rebalancing the sources of growth away from investment and exports toward consumption, 2016 Business Travel Demand Growth Forecast China’s soft landing is expected to continue.

The other Asian country to watch is India. In 2014, India’s business travel spend was US$26 North America Europe billion, which put it in 10th spot and the Global % Global % +4.7 Asia-Pacific Business Travel Association (GBTA) forecasts % +5.4 that India will jump to sixth position by 2019 +6.5 % with spend going up to US$45 billion. Latin America Middle East +9.4 +6% & Africa +5.3%

Source: Global Business Travel Association (GBTA) Why the industry should pay attention to India’s potential The Global Business Travel Association India’s economic growth can be attributed to aggregator Redbus, which offers real-time (GBTA) says India will be the fastest growing the continuing Modi “dividend” which refers to booking of bus routes across bus operators economy in the world in the next five years Prime Minister Narendra Modi sweeping into and is now expanding into Singapore and and it is now valued at US$2 trillion. office in May 2014 promising jobs, prosperity Malaysia – can for example tap India’s and international renown. burgeoning business travel sector and create Based on its BTI OutlookTM study of the BRIC products and services targeted at business (Brazil, Russia, India, China) economies, Factors that will drive India’s businesses travellers. India leads and delivered a year-on-year and demand for business travel include 1Q2015 growth of 7.5% and a quarter-on- infrastructure development projects, steady Total Business Travel Growth – India quarter 1Q2015 growth of 7.5% as well. job creation and the advancing middle % Year-on-Year (Billion US$) class demanding more goods and services GBTA calls India the “star child” because and lower oil prices energising household +9.2% +10.8% +11.1% +11.1% business travel spend in India will jump from consumption. US$26 billion in 2014 to US$45 billion in 2019 and India will move from 10th spot in the The entire travel supply chain targeting global ranking of key Asian countries to business travellers can reap new business $24.1 $26.7 $29.7 $32.9 sixth spot. opportunities.

GBTA adds that the current economic Travel and technology Indian start-ups – such 2013 2014 2015 2016 conditions in India provide a favourable as MakeMyTrip, which is India’s leading online Forecast Forecast outlook for business travel spend for the travel company, Guiddo, which is a mobile following reasons: travel guide and tour planning app, and bus- Source: Global Business Travel Association (GBTA)

15 Catalysing Travel and Tourism in Asia A s ia n B u s i n e s s Travel

Focus on the Asian Business Traveller he report – Asian Business Travellers: Five Things You Need to Know1 – was commissioned by the Singapore Tourism Board The 5 Things T(STB). you need to know STB’s knowledge partner McKinsey & Company undertook research Employee empowerment among on China, India, Indonesia, Japan and Singapore, with booking Asian business travellers (ABTs) pattern analysis from Amadeus data and spending pattern analysis is high and rising from Visa data. Business travel is just as The report was a highlight at the 2015 Asia Travel Leaders Summit. susceptible to the disruptive forces affecting leisure travel The research provides a better understanding of Asian business travellers (ABTs). For instance, Asians are twice as likely to make a ABTs exhibit some clear, universal preferences booking that includes a weekend compared to Europeans and 81% are willing to extend their business trip for leisure. ABTs are not homogenous ABTs – Essential Takeaways for There are four ABT archetypes See page 17 for a better understanding Travel Companies of the Asian business traveller and page 18 for a snapshot of what is important to First, know your end users the different traveller types ABTs have much more freedom and flexibility over their travel Source: Asian Business Travellers: Five Things decisions than expected. With this decision-making power tipping You Need to Know, McKinsey & Company away from the company towards the employee, travel companies cannot rely solely on their corporate travel desk and must also know and target their end user directly. The Promise of the ASEAN Economic Community Second, personalisation is essential Also lighting up the scene in the region is the ASEAN Economic Travel companies already collect a wealth of data on their Community (AEC) becoming a reality in 2016. The ratification of customers. However, there is a significant opportunity to get a AEC policies is still a work-in-progress, but the agreement to lot smarter about how they use it – particularly in tailoring their streamline visa, VAT and other business rules means the removal offerings to meet individual needs. of economic obstacles and a freer flow of goods, services and people in South-east Asia. It is good news for businesses and an Dynamic bundling is an example of this, where travel companies use increase in international and intra-regional business travel can data on travellers’ prior experiences to create packages tailored to be expected. their preferences. Amazon-like anticipatory selling and using “next product to buy” logic, is another example where customers are offered what they want before they know they want it, whether it is wi-fi, meal upgrade, etc. “The immediate impact (of the ASEAN

Third, when it comes to ABTs, recognise that you are in the Economic Community) we foresee business of selling time is the increase in business travel. We Convenience is king and it is a clear priority for Asian business travellers across all demographic backgrounds. Therefore, to also foresee more (travel industry) be competitive, travel companies must prioritise and mobilise resources focused on delivering efficient and timely journeys. cooperation among the destinations under the ASEAN brand.” While factors such as availability of direct flight routes and convenient hotel locations are difficult to address, travel companies can improve their operational performance to meet the needs of ABTs.

Tran Trong Kien Chairman & General Director Thien Minh Travel, Vietnam 1 Data sources to support the research comprised online consumer surveys of business travellers, interviews with travel managers, booking pattern analysis from Amadeus data and spending pattern analysis from Visa data

16 Catalysing Travel and Tourism in Asia A s ia n B u s i n e s s Travel

UP CLOSE AND PERSONAL

An Interview with Cheryl Lim Associate Partner McKinsey & Company

Lim, who presented the findings of the study based on a sample size of 2,565 respondents from SMEs and MNCs, shares some of the highlights

Were there significant similarities What type of companies are more open to and/or differences between Asian giving ABTs more autonomy and why? “We were expecting Business Travellers (ABTs) in Small and Based on our qualitative interviews ABTs to have some Medium sized Enterprises (SMEs) and with travel managers, it appears that MultiNational Companies (MNCs)? technology companies are at the forefront level of freedom over The survey responses were controlled of providing ABTs with the highest degree to ensure a representative spread of autonomy. their business travel across company type within each of the five countries studied. Overall, 37% of The main reason cited by travel managers arrangements, but not to respondents were from SMEs, 42% from was the in-house capabilities these the degree we uncovered large local companies (LLC) and 21% from companies possess to design and deliver MNCs. technology solutions that allow self- in our research – that 69% bookings. Gamification, where employees Travel behaviour varied by company type, are rewarded for choosing lower-cost of travellers are able to but mostly along expected lines and travel options, is one tool emerging in differences between respondents from technology companies. choose their preferred different types of companies were mostly along predictable lines. The online survey we conducted did not airline ... and 74% enjoy distinguish respondents based on their SME respondents expectedly ranked industry type. this flexibility with their “value for money” much higher, a factor choice of hotels as well.” that likely contributed to their higher Is cost saving still the top priority or tendency to fly LCCs or stay at shared something else? accommodation. Cost is indeed a key decision-making Based on the study, what do travel factor for travel managers in choosing companies need to pay the most attention Another key difference is that a significant travel partners. However, they also to and why? proportion of SME respondents were reported that ancillary services, which Travel companies must target and unaware or unsure of their corporate travel ensure convenience and efficiency for their engage end-users directly, learn from policy – 40% – compared to 18% across employees – such as priority check-in and the disruptors, differentiate from them, LLC and MNC respondents. lounge access – were key differentiating make friends with the competitor and form factors when establishing partnerships partnerships. For MNCs, loyalty for instance was a bigger with travel providers. factor and respondents were twice as likely In owning the end-to-end journey and to bend policy for loyalty points compared In the five things to know about ABTs, trying to extend it, personalisation is key. with SME travellers. what is the most surprising finding? We were expecting ABTs to have some As for the next wave of segmentation being They also appeared to be the biggest level of freedom over their business travel about preference not demographics, and spenders, consistently being the group arrangements, but not to the degree we the use of data analytics as the engine most likely to spend personally on uncovered in our research – that 69% needed to support this type of evidence- extras, fly full-service carriers and stay of travellers are able to choose their based decision-making, many of these in international chains. Even in these preferred airline, either from a pre- implications are interdependent and cases, however, country differences approved list of carriers or with no policy mutually reinforcing. mattered more than company differences. restrictions on carriers at all, and 74% For example, 97% of MNC respondents enjoy this flexibility with their choice of from India were willing to purchase add- hotels as well. Significantly, these figures ons, compared with only 69% of MNC did not vary materially by company type or respondents from Singapore. level of seniority.

17 Catalysing Travel and Tourism in Asia A s ia n B u s i n e s s Travel

The 4 Asian Business Traveller Archetypes

ccording to the Asian Business Travellers: Five Things You Need to AKnow report, the Service Seeker, Belt Tightener, Stereotypical Suit and Points Service Seeker Belt Tightener Maximiser are the four archetypes that emerge among Asian business travellers The Service As the name polled and they represent 34%, 32%, 17% and Seeker values suggests, the 17% respectively of the respondents. service, brand Belt Tightener and facilities is acutely price While the characteristics of each archetype and the defining sensitive and can vary by age, position, country, size of preferences are value seeking, company, nature and frequency of travel, one award-winning and the defining thing stands out for each of the archetypes. services, work and leisure facilities preferences are lowest fare and and feeling valued as a customer. value for money. When it comes to the traits of Asian business travellers by country, unique traveller profiles emerge. Characteristics Characteristics

The report describes Singaporean business travellers as “budget luxe” and when % % % selecting flights ranked in-flight comfort 59% 94 55 73 as their most-valued attribute even above convenience. Are Are willing to Are in Predominantly Indonesian pay for ancillary junior travel Digital savvy and willing to spend describe or Chinese services on positions domestically Indian business travellers who have the flight/hotel strongest appetite for digital processes and are most willing to use online and mobile booking tools. Stereotypical Suit Points Maximiser Chinese business travellers are heavily service oriented and concerned about For the The Points prestige. They are the only ones who ranked Stereotypical Maximiser award-winning service among the top three Suit, convenience prioritises factors for selecting either a flight or a hotel. is of the utmost loyalty points importance and and comfort Indonesians have the most positive the defining and the defining experience as business travellers and agree preferences are preferences are it is a perk of their job. They place clear direct flights, convenient arrival/ loyalty and reward programmes, emphasis on feel-good brand and service departure times and convenient hotel comfortable seats and luxurious factors and tend to combine a business trip location. rooms. with a leisure trip.

With the policy- and price-conscious Characteristics Characteristics Japanese business traveller, work and leisure do not mix. They were the least likely Found across % % % to consider business travel a perk of the job 61 all countries, 67 65 companies and and the least likely to deviate from travel positions in policy. roughly equal Are over proportions Are Are frequent the age Singaporean travellers of 35 or Japanese (more than three times a year)

Source: Asian Business Travellers: Five Things You Need to Know, McKinsey & Company

18 Catalysing Travel and Tourism in Asia China MICE

Mighty MICE Action in China n 2015, a landmark study titled Market According to the study, China’s domestic corporate conferences, which take up a 54% Assessment of MICE Business Travel in MICE spend in 2014 was US$110 billion or share, followed by institution conferences at IChina – involving more than 1,500 business 45% of total business travel spend that 23%, government agency conferences at 14% travellers – was conducted by the GBTA year with volume of 138.5 million or 42% of and association conferences at 9%. Foundation and sponsored by Starwood Hotels business travellers. and Resorts, which operates 150 hotels in In China, MICE spend is dominated by the China and where more than 150 more are in MICE travel industry suppliers should take manufacturing sector which contributed a total the pipeline. note that three Chinese gateway cities spend of US$59 billion in 2014, far ahead of dominate the hosting of MICE events and they utilities in second place with US$13 billion and The study, first released at ITB Asia 2015, account for 76% of China’s domestic MICE agriculture, forestry and fishing in third place focuses on China’s domestic MICE market, and activities. Shanghai has the largest share with with US$5 billion. is based on the GBTA Business Travel Index 27% share, Beijing with 25% and Guangzhou (GBTA BTI™), the survey of business travellers with 24%. Future MICE spend between 2014 and 2019, in China and macroeconomic data. This is the based on the compound annual growth rate first in-depth look at China’s domestic MICE In choosing accommodation for MICE events of projected gross output by sector, shows spend. in China, the top three reasons are location the top three as health and social work taking (62%), hotel services and amenities (51%) and up 12% – due to China’s ageing population – The objectives of the study were to determine hotel brand (37%). Most China domestic MICE followed by sectors catering to a rising middle the size of China’s domestic MICE sector, travellers (59%) stay an average of two to class with water supply and sewage taking up develop a delegate profile for MICE activity in four nights. 10.5% and financial and insurance activities at China and assess the opportunities for travel 10%, which tied with education. companies that provide products and services The latest China Conferences Statistics for MICE events held in China. Report shows the majority of MICE events are

Infographic Percentage of Total MICE Events Hosted by City in China Average Length of Stay of China’s Domestic MICE Travellers in 2014 Day trip 8%

1 night % 25 Average 2.9 % 2-4 % Nights 25 nights 59 Beijing 5-7 % nights 8 % 27 > 8 % Shanghai nights 1 Source: Global Business Travel Association (GBTA) 24% Guangzhou Top MICE Spend by Sector in China (Billion US$)

% % 6 6 % Other Macau 11 destinations Hong Kong $59 $13 $5 $5 $5

Manufacturing Utilities Agriculture, Wholesale & Construction Forestry & Retail Fishing

Source: Global Business Travel Association (GBTA) Source: Global Business Travel Association (GBTA)

19 Catalysing Travel and Tourism in Asia China MICE

Characteristics of Chinese MICE delegates

The 2015 landmark study titled Market Assessment of MICE Business Travel in China revealed:

Of the business travellers surveyed, As for the type of venue the MICE 1 86% said they had attended a MICE 6 event was held in, 38% took place in a meeting with 10 or more people where conference or convention centre, 33% they had to travel 80km or more in the on site at company offices and 21% in last 12 months. training centres.

The average length of stay was 2.9 Airlines also benefit greatly with 64% 2 nights, with 59% staying between two 7 of attendees flying to the MICE event, and four nights and 25% one night. The compared to 18% taking the train and average spend per trip was US$829, 14% going by a rental or personal car. with air transportation taking up 32%, lodging 20% and F&B 15%. “In China, there is a rapid take-up of IC&E projects The “typical” MICE event had between The most common reason for taking 3 50 and 100 people attending a 8 the trip for 53% of business travellers by many business sectors convention or conference, a training is to attend a training course or to course or seminar or some other group attend a seminar from international fast- meeting. moving consumer goods companies to many local 4 Hotels reap a large benefit and when 9 There are different reasons for a meeting is held at a hotel with attending different MICE events but companies learning from a designated room block, 88% of the most important is for business delegates stay at the hotel. development, followed by training. international companies operating in The median age of the MICE delegate 5 The top reason for choosing a hotel is 10 the location (62%), followed by hotel is 37, with the majority, 48%, between the country. The rise of service and amenities (51%) and the the age of 35 and 44. Overwhelmingly, brand (37%). 72% of meeting attendees are male. China’s large middle class and the demand for a more GBTA expects China’s domestic MICE sector to Meanwhile, luxury incentive trips are emerging sophisticated marketplace continue to grow with a potential net increase in China and it is not uncommon for incentive of 20% based on respondents forecasting the delegates to fly first class. It is also not unheard will fuel rapid growth of number of meetings they expect to attend in of for top automotive industry dealers on the next 12 months compared to the previous incentive trips to travel on private jets. the industry.” 12 months. Top achievers are looking for deluxe The study concludes that China’s MICE growth experiences money cannot buy such as a is expected to continue and the Incentive, surprise meeting with the former President of Conference & Event Society Asia Pacific South Africa, the late Nelson Mandela. (ICESAP) shares the same view. As for China MICE and the demand for ICESAP sees technology, automotive, ecotourism, ICESAP sees a rising trend pharmaceutical and other sectors in China where corporate social responsibility (CSR) embracing IC&E in order to retain staff as programmes incorporate teambuilding Nigel Gaunt employers struggle with manpower issues and activities with tree planting, animal rescue President also need to retain the loyalty of distributors, among others. There is also increasing use of Incentive, Conference & Event Society Asia Pacific sales channels, etc. locally sourced produce.

20 Catalysing Travel and Tourism in Asia H u ma n Capital

The Economic Power of Gender Parity he McKinsey Global Institute (MGI) in According to McKinsey, what is at stake is that Other reports highlight a gender gap at the a report1 published in September 2015 higher female representation correlates with a leadership level among women in Asia. Tstates that advancing women’s equality 47% increase in return on equity and 56% higher can add US$12 trillion to global GDP growth in earnings before interest and taxes margins. While the industry employs a large number 2025, equal to the combined GDP of Germany, of women, the White Paper on Women in the UK and Japan combined. The UN World Tourism Organization (UNWTO), Tourism and Hospitality: Unlocking the which produced the Global Report on Potential in the Talent Pool by the University of If women in the labour force participated Women in Tourism, revealed that the overall Strathclyde in Glasgow, says the large talent identically to men, as much as US$28 representation of women in Asia is 56%. pool is currently under-utilised in Asia-Pacific. trillion could be added to global GDP in 2025, equivalent to the current US and China UNWTO also states the industry can offer Of the nearly 75,000 associates working in one economies combined. significant opportunities to narrow the gender international hotel chain in Asia-Pacific, for gap in employment and entrepreneurship example, 42 per cent are women, 38 per cent These figures demonstrate that women and women are nearly twice as likely to be are women executives, and only 12 per cent matter and more can be done to capitalise employers in tourism as compared to other are at general manager level. on the contribution of the female population sectors. The report shows that women are The aim of the White Paper is to raise – which accounts for 50% of the working-age well represented in service and clerical- awareness of the potential of women and workforce but only 37% of global GDP now. level jobs, but are poorly represented at to promote workplace gender equality professional levels and earn 10% to 15% less At the Asia Travel Leaders Summit, McKinsey in the hospitality sector. The authors than their male counterparts. & Company said in Asia, women’s contribution recommend collaborative efforts from private to GDP is 41%2 in China, and 34% in East and organisations, government and employees Research by the World Travel & Tourism South-east Asia. Within East and South-east and say stakeholders need to invest and Council (WTTC) and Oxford Economics adds Asia, women contribute between 28% and “get involved”. the industry offers women prospects for 42% to GDP – with 28% in Indonesia, 32% in self-employment, which is less accessible in Malaysia and 40% in Singapore. other sectors.

1 McKinsey Global Institute The Power of Parity: How Advancing Women’s Equality can Add $12 Trillion to Global Growth, September 2015

Women in Travel and Tourism “There is strong correlation Where They Stand between the proportion of women Pay of women on executive committees and in hotels and company financial performance. restaurants is McKinsey’s Women Matter closer to that of research found that companies men than in in the top quartile for women’s other sectors.2 representation in their sector saw a 47% increase in RoE (return 70% on equity) and 56% higher EBIT of employees (earnings before interests and taxes) % in the hospitality margins, compared to companies Women in Asia hold 56 sector are that had no women.’ of jobs in the travel and tourism industry.1 women.3

Women hold less than 40% of Only 20% of hospitality management positions hospitality management positions.4 held by women are at general manager level.5

Source: 1. UN World Tourism Organization (UNWTO) Cecilia Ma Zecha 2. World Travel & Tourism Council Head of External Relations, South-east Asia 3-5 White Paper on Women in Tourism and Hospitality: Unlocking the Potential in the Talent Pool by the University of McKinsey & Company Strathclyde in Glasgow

21 Catalysing Travel and Tourism in Asia H u M A n Capital

The C-suite Transition look into how companies prepare for At TUI, HR development is not just a tool to “Travel and tourism is a very succession has revealed that many treat it close the skills gap, but is a strategy – with a Aas an abrupt event trigged by the departure wide range of programmes and methods – to dynamic industry highly of the old CEO, rather than a structured process. identify and develop potential executives and to prepare them for the expectations they dependent on external Many companies, according to McKinsey & will face. Company, also focus on selecting a supposedly factors. Exceptional ideal CEO rather than asking what is the right TUI has implemented an International CEO profile given the priorities ahead. Graduate Leadership Programme which occurrences such as natural allows university graduates to gain experience With a “lack of structure”, many C-suite in different departments of the organisation disasters can have a massive successions are reactive and divorced from the and assume responsibility from the very impact. High employee wider system of leadership development and beginning. talent management, and this approach has turnover, especially in the significant risks. Another of its programmes targets high- potential managers and possible successors C-suite, is fairly common. For example, potentially good candidates may for executive positions, and the candidates are not have sufficient time or encouragement to challenged to identify solutions to a corporate Due to demographic develop. Unpolished talent could be overlooked. initiative while at the same time developing Companies may gain a damaging reputation for their own personal leadership style. changes, many countries not developing their management ranks. Additionally, young hopefuls receive training are going to face a serious Headquartered in Hannover, Germany, TUI – focused on self-management and staff skill shortage in the future. the largest leisure, travel and tourism company management skills, while experienced in the world, whose portfolio includes travel managers can discover options for further Therefore, fostering young agencies, hotels, airlines, cruise ships and career development in a rapidly changing retail stores – has in place an integral and corporate environment. talent is most valuable.” future-oriented strategy that is aligned with its corporate goals. 3 Biases that Jeopardise Successful Transition of C-Suites

The “more of me” bias The sabotage bias is where The herding bias is where Michael Frenzel is where CEOs look for there is the tendency to transition committee Chairman or try to develop a copy promote a weak candidate members may adjust World Travel & Tourism Council of themselves. who therefore seems likely their views to match the and Chairman Emeritus, TUI AG to prolong the current incumbent CEO or the CEO’s tenure. chairman of the board. Source: McKinsey & Company

The Situation for Women Managers in Asia According to McKinsey & Company’s Women The third most-cited reason in Asia is a lack of Michael Frenzel, Chairman, World Travel & Matter research in Asia, women face the pro-family public policies or support services, Tourism Council, and Chairman Emeritus, TUI double-burden syndrome of balancing work for example, quality childcare and parental care. AG, says the industry can tap the full potential and home responsibilities. of C-suite female candidates by fostering the Nowadays, the majority of the students coordination of holding a job and looking after Among business leaders surveyed, 40% ranked taking tourism management courses at a family. the “double burden” of holding a job while universities are female and TUI says equal looking after their families as the greatest employment opportunities have to be created “The travel and tourism industry employs obstacle preventing women from moving into to allow any suitable candidate to move up the many highly qualified women who have senior roles. career ladder. the potential to take on a C-suite position… possible options in this regard could be (the The second most-cited reason in Asia is the The travel and tourism industry employs provision of) childcare, flexible working hours “anytime, anywhere” performance model, many women with university degrees but the and a home office,” he noted. making it more difficult for women who want to majority of the C-level positions are held balance work with family responsibilities. by men.

22 Catalysing Travel and Tourism in Asia H u M A n Capital

Attracting and Retaining Future Talent ITB Asia Future Leaders Students and industry leaders gathered for UP CLOSE AND PERSONAL this annual event at ITB Asia, eager to discuss the opportunities in the tourism and hospitality industry. Three presenters shared their views An Interview with on how they managed to grow their careers in Neeta Lachmandas this diverse and exciting sector. Executive Director, Institute of Service Excellence (ISES) at Singapore Management University (SMU) Mr Melvin Lim, Area General Manager, Far East Hospitality, shared how going abroad gave him experiences that enabled him to progress Although the tourism and hospitality industry here in Singapore is flourishing, it up the career leader; Ms Gabrielle Choy, Area continues to be crippled by a shortage of qualified manpower. Lachmandas believes Director of Human Resources – Singapore, that there are possible solutions, but there needs to be a radical shift in the mindset of InterContinental Singapore, explained how she both employees and consumers in recognising the value of service staff. leaped from an operational to marketing role; and Elaine Heng, Assistant Director, Group How severe is the manpower problem? What is the best recourse for Marketing & Communications, Park Hotel I would say it is pretty immense. There are the industry? Group explained how students can leverage gaping shortfalls in talent. A fair number The upshot is that there has to be their training to take on managerial roles. graduate from tourism and hospitality more recognition of service employees courses at tertiary institutions but we tend from both employers and customers. Students were also given a sneak peek of to lose a large proportion of the cohort. Businesses in the tourism and hospitality the Singapore Skills framework for the hotel These students are highly intelligent, and sphere need to change. They need industry which aims to provide in-depth they are passionate about the industry. to alter their perspective to see good information on the industry and employment But in the course of four years, they lose service and delivering good service outlook, career progression pathways, their passion and love for the industry. Why adds value to the top line. Service is occupations, skill descriptions, as well as skill does this happen? It is because there is a a huge differentiator. Frankly, serving training programmes. lack of structured training and feedback. people demands a defined set of skills. Companies need to inspire students from Therefore, it is imperative to treat service Students’ Say the outset, by giving them a clear pathway staff as professionals and to recognise in terms of career progression, and this the tourism and hospitality sectors as a Which area most appeals to you in a career in the hotel does not always happen. highly skilled industry, and to compensate industry? and empower its members. There needs 39% 21% 36% Why is there ambivalence to investing to be a shift in the work culture and in people? mindsets within organisations and there Enjoyed working in Potential More opportunities When I speak to companies about is a dire need for better managers, who a people-oriented for career for industry perks investing in their staff, many claim are adept and flexible enough to balance industry advancement (eg travel) they cannot afford the time to train. the different needs of employees with Some others do not want to train their operational requirements. employees as there is an unfounded How many in the audience are keen in a career in hotels after our speakers have shared their views? fear that they would be poached by However, we should not be too hard on rivals. Hence, by and large, in Singapore, ourselves. There is definitely a greater 56% 11% 33% delivering good service is seen as a cost awareness among industry leaders for the rather than a potential revenue generator. need for quality service. Yes No Undecided

Source: ITB Asia Future Leaders 2015

Tips from the Experts at ITB Asia Future Leaders 2015 How to Carve a Long and Fruitful Career in Tourism and Hospitality

Earn your stripes – do not be afraid of pulling up your sleeves to get a job done. Know that there is no shortcut to success – be prepared to do some hard graft. Always do everything with integrity – be authentic and honest. Uphold your values. Work together – teamwork is a key aspect of providing good service. Do not blame others when things go belly up; co-operate and find solutions.

23 Catalysing Travel and Tourism in Asia

TravelRave 2015 Partner Acknowledgement The Singapore Tourism Board wishes to thank all the partners who provided generous support to make TravelRave 2015 a success.

McKinsey & Company CNBC Asia Travel Leaders Summit Knowledge Partner Asia Travel Leaders Summit and TravelRave Leaders McKinsey & Company is a global management Gala Broadcast Partner consulting firm, deeply committed to helping institutions CNBC is the leading global broadcaster of live busi- in the private, public and social sectors achieve lasting ness and financial news and information, reporting success. For over eight decades, the firm’s primary directly from the major financial markets around the objective has been to serve as its clients’ most trusted globe with three regional networks including CNBC in external advisor. With consultants in more than 100 Asia, CNBC in EMEA and CNBC in the US. CNBC.com offices in 60 countries, across industries and functions, is the pre-eminent financial news source on the web, the firm brings unparalleled expertise to clients featuring an unprecedented amount of video, real-time anywhere in the world. The firm works closely with market analysis, web-exclusive live video and analytical teams at all levels of an organisation to shape winning financial tools. strategies, mobilise for change, build capabilities and drive successful execution. TTG Travel Trade Publishing TravelRave 2015 Report Partner The St. Regis Singapore TTG Travel Trade Publishing was commissioned by the Asia Travel Leaders Summit Venue and Hotel Singapore Tourism Board (STB) to develop this report, The St. Regis Singapore is positioned at the top of the which highlights key insights regarding trends and market, offering timeless elegance and peerless ser- issues affecting the travel and tourism industry in Asia vice synonymous with the St. Regis name. Situated at raised and discussed during TravelRave 2015. The main the crossroads of world-class shopping belt, Orchard sources of research used in the compilation of this Road and the embassy enclave at Tanglin Road, The St. report were: Regis Singapore is also within walking distance to the • Attendance at various TravelRave 2015 conferences city’s first UNESCO World Heritage Site, the Singapore and events. Botanic Gardens. Since its opening in April 2008, The • Interviews with various selected delegates and key St. Regis Singapore has earned numerous prestigious speakers at TravelRave 2015. accolades as one of the best hotels regionally and • Desk research encompassing both offline and online internationally, offering the signature St. Regis Butler resources including PhoCusWright, STB, Skift, Service to every guest, ensuring a tailored experi- McKinsey & Company, the Global Business Travel ence of exemplary comfort and indulgence beyond Association (GBTA), the Incentive, Conference & expectation. Event Society Asia Pacific (ICESAP). TTG Travel Trade Publishing has been connecting Capitol Theatre Asia-Pacific’s travel industry with its leading trade pub- TravelRave Leaders Gala Venue lications since 1974. Widely acclaimed as the industry’s Capitol Theatre is an architectural and lifestyle gem, preferred read and advertisers’ choice of marketing revived from being a historical, neo-classical icon to a platform, the one-stop integrated portfolio of print and vibrant destination at the heart of Singapore’s civic and online titles spans across the leisure trade, corporate cultural district. Furnished with the latest state-of-the- travel, MICE and luxury travel domains, reaching art audio and visual system and South-east Asia’s first key decision makers and trade professionals across rotational floor system that allows customised seating Asia-Pacific and beyond. Core titles includeTTG Asia, configuration for every occasion – from performances, TTG China, TTG India, TTGmice, TTG-BTmice China, seminars and conferences to movie screenings, the TTGassociations, TTG Asia Luxury and TTG Show Daily. restored Capitol Theatre is Singapore’s first venue with direct ground level access to the 900-seat theatre, providing a grand and glamorous entrance for any Red Carpet event.

About TravelRave 2015

TravelRave Singapore Exhibition & Convention Bureau TravelRave, Asia’s premier travel and tourism week, The Singapore Exhibition and Convention Bureau™ took place from October 19 to 23, 2015 with an exciting (SECB) is a group within STB tasked specifically to line-up of quality events featuring thought-provoking champion business travel and business events as key content, influential speakers and the chance to net- drivers of the tourism sector and enablers for industry work with some of the leading names in the travel and growth in Singapore. It aims to establish Singapore as tourism industry. Leveraging Asia’s growing potential, a dynamic business events destination where people, TravelRave 2015 provided a dynamic platform for busi- technology and ideas converge to create great value ness leaders and industry professionals to convene, for customers. As the leading government unit for the share knowledge and insights, network and discover business events sector in Singapore, the Bureau works new business opportunities and celebrate Asian tour- with stakeholders to create, attract, and grow business ism at its best. Find out more at www.travelrave.sg. events, as well as ensuring exceptional experiences in the delivery of these events. The Bureau also develops Singapore Tourism Board partnerships with international organisations and alli- The Singapore Tourism Board (STB) is a leading ances. For more information, please visit www.stb.gov. economic development agency in tourism, one of Sin- sg or mice.yoursingapore.com. gapore’s key service sectors. Known for partnership, innovation and excellence, STB champions tourism, BestCities Global Alliance making it a key economic driver for Singapore. The The Singapore Exhibition & Convention Bureau™ board aims to differentiate and market Singapore as (SECB) is a member of the BestCities Global Alliance. a must-visit destination offering a concentration of BestCities is the first global alliance to put in place user-centric and enriching experiences through the a certification programme – with standards certified YourSingapore brand. For more information, please by Lloyd’s Register Quality Assurance (LRQA) – to visit www.yoursingapore.com ensure a consistent level of convention bureaau service excellence from all partner cities. BestCities Partners are Berlin, Bogotá, Cape Town, Copenhagen, Dubai, Edinburgh, Houston, Melbourne, Tokyo, Chicago, Singapore and Vancouver. For more information, please visit www.BestCities.net.

For information on the travel business events happening in Singapore, please contact: Michelle Chah, Manager, Exhibitions & Conferences, Singapore Tourism Board Email: [email protected] DID: +65-6831 3728

© 2016 Singapore Tourism Board. All editorial content, graphics, images, and logos in the report (the Content) are protected by copyright, other laws and/or international treaties, and are owned by, licensed to or controlled by the Singapore Tourism Board (STB), unless otherwise stated. The Content shall not be copied, reproduced, republished, uploaded, posted, transmitted, imitated or otherwise distributed, whether in whole or in part, without the written permission of STB or the respective copyright owners if otherwise stated.

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