Fuel charges face industry challenge - Travel Industry Review

Fuel charges face industry challenge - Travel Industry Review

What the Four Seasons Hotel The Westcliff has lined up for Africa’s corporate elite. Page 6. More sales and earning opportunities in the Cruises feature, from page 8. New attractions for the Kids & Family Travel sector, from page 15. Published by TTG Southern Africa Travel Industry Review South African buyers attending VisitBritain’s ExploreGB workshops in Liverpool last month later visited Fowey in Cornwall as part of a post-meeting tour. Overlooking the estuary outside the Fowey Hotel (l to r): Susan Thesen, British TIPS, Cape Town; Kay Ellison, Thompsons Tours, Johannesburg; Felicia Carollus, United Europe, Johannesburg; Angela Thomas, Flight Centre, Johannesburg; and Noorjehan Vadachia, Avoca Travels, Durban.

Cruises International received accolades at the recent Royal Caribbean World Summit in London, including the RCL Meetings, Incentives, Conferences and Exhibitions award in the Europe, Middle East and Africa category. The company produced US$2.2-million of the region’s US$3-million revenue. It also took home its third award for Azamara, a division of Royal Caribbean. Pictured (above, from left): Lizaan Schnettler with Incentive Manager Dalene Oroni and Michelle Hermans. ASATA/SAT project aims to boost trade’s domestic sales BY SARAH CORNWELL THE ASSOCIATION of Southern African Travel Agents and South African Tourism will implement the first phase of their new domestic tourism growth strategy this month, initially targeting the corporate sector, with a mix of specially negotiated business-leisure travel deals and packaged itineraries.

It is a bid by ASATA to assist and encourage retailers to significantly grow their domestic business and channel more domestic travel through the trade. 20 ASATA-accredited corporate agencies or TMCs which have consultants at a corporate client were selected to pilot the project. “We start activation in member corporate customers in April,” said ASATA General Manager, Kim Koen. “All the papers are signed... We are working very closely with our members, [with] product that has been negotiated as part of the pilot.” The agreement could be expanded but in a phased roll-out, Ms. Koen said, depending on the success of the corporate campaign.

It could also be adopted for the leisure sector.

The campaign is a spin-off from SA Tourism’s national ‘A Million New Experiences are a Sho’t Left Away’ domestic tourism campaign and follows a high-level industry think tank involving SAT, ASATA and its members last year. “ASATA put together a member advisory forum involving members but also sister organisations, who brain stormed and put together a strategy that was presented to SAT,” Ms. Koen revealed. Fuel charges face industrychallenge BY RICHARD HOLMES THE retail travel industry is attempting to force airlines to ditch the fuel surcharges added to basic fares. The campaign is being led by the Association of Southern African Travel Agents.

ASATA said there would be immediate cost savings for passengers and called for government intervention to persuade airlines to scrap the carrier-imposed charges. The fuel surcharge has been one of the most contentious issues in the travel industry, with the widespread complaint that fuel prices were a cost of doing business and should be factored into fares. It has become even more controversial with the collapse of the price of oil. Airlines maintain that the separate surcharge is needed to allow airlines to manage their fluctuating fuel bill, commonly affected by hedging.

The fuel surcharge was introduced in 2004 when crude oil prices spiked, and continued to climb above US$100 a barrel. Since then, the price of crude oil has fallen to a 12- year low, although airlines globally have been quick to point out that fuel hedging means savings are not immediately felt in their bottomline. Compounding the issue is the fact that airlines do not buy crude oil; they require refined jet fuel that sells at a premium well above the crude oil price. “It is an oversimplification of the situation to expect jet fuel to be at the same low levels as the price of crude oil,” said South African Airways spokesperson Tlali Tlali.

Every airline works with the various cost elements in their business and they make the decisions on levies Enter to win with TIR and American Tourister! TIR readers have the chance of winning great prizes from leading luggage specialist, American Tourister, by entering the Spotted with TIR competition each month. Just send us photos of you reading TIR in interesting places... turn to page 6 to find out who this month’s lucky winner is... continued on page 4 continued on page 5

Fuel charges face industry challenge - Travel Industry Review
  • 4 TIR Southern Africa
  • April 2016 News Digest 1 2 3 enews updates Most Read stories from the past month ___ 4
    5 Bidvest Car Rental aims to grow market share Travellers warned to book ahead of April fare hikes ASATA Diners Club Awards finalists posted Comair chief clarifies CAA criticism report AVIS to launch new brands, incentives, websites “This is a pilot project so we don’t know if it is going to work, but we are committed to making it a success. South African Tourism has already been successful in promoting its Sho’t Left campaign... And we are negotiating packages through basic market research. “There are customers that may or may not buy in... but this is a pilot, with a start date and an end date. Based on its success, there will be additional [campaigns]. A top 20 [intermediaries] will become top 70. We don’t ever want to lose momentum.” Participating agencies will be provided with brochures and there are plans to kickstart the programme with launch events and presentations to corporate SA. “One of the key tactics we will be employing... is a corporate roadshow addressing the benefits of leisure add-ons to business travel to promote staff wellness and retention,” commented Otto continued from page 1 ASATA/SAT project aims to boost trade’s domestic sales de Vries, ASATA’s Chief Executive Officer. Member travel agencies and consultants will be exposed to more local tourism product and destinations through online training as well as first-hand experiences, he said. Margie Whitehouse, Chief Marketing Officer at SAT, said the programme would immediately reach South Africa’s banking, telecommunications and government sectors and expose more South Africans to new, local experiences. “We know that worldwide there is a new breed of travellers who are called bleisure travellers because they put fun back into business travel by mixing business with leisure travel... this partnership presents the perfect opportunity to not only grow this new trend in our own country but to continue entrenching the culture of travel. We truly believe that partnering with the travel industry is the best way to do so. “The criteria for selection has been in-house or implant [consultants]... But phase one is just the beginning. Hopefully we will go from phase one to phase 50. It is a litmus test for SAT... to see if they will get the return they are looking for,” said Ms. Whitehouse. The latest product sales, marketing and training resources for travel professionals. Sales Resource the Agents to receive tailored offers through Smartpoint. Travelport has introduced new functionality to its Merchandising Suite that will enable airlines to make tailored or personalised offers to individual travel agencies and/or the corporations that a travel management company services. So far, Air India is providing UK-based agents with the option to add a limo service to business class bookings. TAM Airlines is making business class lounge access available to economy passengers booking in the UK and travelling via Heathrow. New Insight programme released. Insight has released its new Autumn, Winter and Spring programme three months ahead of schedule, with early booking discounts of 7.5 percent with payment ending August 29. Tours run November 2016 – March 2017 and include a new seven-day Iceland option, Scenic Iceland & Northern Lights (pictured right), from R41,700. Download the sales guide from: www.insightvacations.com/za/special-offers/2016-europe-aws Contiki relaxes change policy. Contiki Holidays has introduced FlexDeposits and done away with change fees when clients change their trip or departure. If the price of the new trip is more, the balance will be owed. However, if the new trip is less, the balance will be refunded. The FlexDeposit can be redeemed on any trip until the passenger’s 36th birthday. For those aged 36 and older, it can be used towards a trip with another of The Travel Corporation brands. The Travel Corporation recently launched a ‘use it, don’t lose it’ promotion, giving passengers who had cancelled their trips within the last three years a travel credit of the R1,000 deposit amount towards another trip. The Holiday Factory adds Mauritius sales guides. The Holiday Factory has launched its Mauritius brochure for 2016. To request a copy, email: brochures@theholidayfactory.co.za. Zanzibar and Seychelles sales guides are available from: www.theholidayfactory.co.za. > Email submissions to sarah@tir.co.za With check-in required three hours in advance of departure for international flights at Heathrow, passengers travelling in the back can have a relaxed pre-flight experience at Swissport’s lounge in Terminal 3. Book in advance or just turn up, pay £18 for three hours’ access and get complimentary food, drinks, Wi-Fi, power outlets, newspapers and magazines and unbusy washrooms. The cheapest lounge option and cheaper than buying food and drinks in the general terminal – and a lot more comfortable. ASATA Diners Club Awards to be presented at conference THE frontrunners for this year’s ASATA Diners Club Awards have been named. Winners will be announced at the awards evening on May 20, coinciding with this year’s ASATA conference. The finalists are: Exceptional Commitment George Argyropoulos, Cruises International Linda Benwell, XL Millennium Travel Lynn Howarth, HRG Rennies Travel Tomorrow’s Leader Irene Ferreira, Reynolds Travel Centre Robyn Daneel-Spicer, Sure Travel Stellenbosch Yolanda Barkhuizen, XL Boland Travel Corporate Travel Consultant Anria Kruger, Tourvest American Express Travel SA Tammy McFie, Reynolds Travel Centre Tarryn Classens, Sure 24-7 Travel Leisure Travel Consultant Evengeline September, Club Travel Algoa Bay Oriana Caldiera, Flight Specials Centurion Sharlene Galloway, Sure The Travel Agent ITC Charmaine McFarland, Travel Counsellors Gail Parker, Harvey World Travel Hayley Eberlein, Travel Icon eTravel Key Accounts Executive Chantelle du Plooy, HRG Rennies Travel Kristen Seeley, Reynolds Travel Centre Phumla Mjoni, Club Travel Algoa Bay Wholesale Consultant Jenny de Vries, Beachcomber Tours Ravi-Lee Loff, Thompsons Holidays Vanashree Moodley, Thompsons Holidays Wholesale Representative Deanne Allchurch, Travel Vision Debbie Georghio, Cruises International Lindsay Roberts, Cruises International The Bidvest Car Rental brand turned a year old in March and the administration team at OR Tambo (pictured left) marked the occasion in style. The company claimed 19 percent market share at the start of 2016. Bidvest currently has 120 locations in southern Africa, including Namibia and Botswana. Pictured: Tourism Minister Derek Hanekom (left) and Comair CEO Erik Venter in the cockpit of the new British Airways Boeing 737-800 aircraft, which joined the fleet at the end of February. It will operate the new Johannesburg - St Helena service, delayed while regulatory approval for the Atlantic Ocean island’s new airport is pending. Comair said last month it was expecting confirmation before the end of April. The new service will launch with one return flight a week on Saturdays. Mr. Venter said the aircraft acquisition was “a strong indicator of our confidence in leisure and business travel” and said, by November last year, African airlines had experienced five consecutive months of growth. “The new aircraft will help us embrace opportunities like the new Saint Helena route,” he added.
Fuel charges face industry challenge - Travel Industry Review
and surcharges to the best of their customer’s interests. We will continue to evaluate our cost elements, including the cost of fuel and, when we have reached the level of a compelling outcome, then we will revise the levies and or surcharges accordingly.” Compounding the issue for local airlines is the rand exchange rate. “Unfortunately, as the fuel is priced in US dollars, the current exchange rate is working against us. As the fuel price comes down the deteriorating rand counters any possible saving,” said Carlos Luis, Flight Centre’s Air Warehouse Leader. “There cannot be a timeline as to when the surcharge will be reduced or removed. There are far too many external factors that impact on these costs for us to be able to predict such occurrences,” added Mr. Tlali. ASATA has revealed that a fuel surcharge study it undertook last year had been shared with the World Travel Agents Association Alliance, of which ASATA is a memcontinued from page 1 Fuel charges face industry challenge On Sundays, from 20 March 2016, Airlink will be flying directly from Johannesburg to Nosy Be, Madagascar – A tropicial paradise offering a range of surprises. From rainforests, volcanic lakes, troupes of lemurs, yacht charters, a largely untouched coral reef for scuba drivers and snorkelers alike and so much more. Its ten-month tourist season, from mid-March until mid-January, means that you can visit almost any time... but why wait if you can book today? Visit flyairlink.com Spread your wings, fly Airlink – freedom of the African sky Nosy Be, Madagascar Unique African Island Getaway Freedomof theAfricanSky 33536 ber, and was being adopted as a global study “to be used to lobby airlines to incorporate the fuel surcharge component in their base fares”. “ASATA’s view is that it is no longer acceptable for airlines to levy a fuel surcharge given the many changes to consumer laws, inclusive pricing and oil prices’ fall,” said Otto de Vries, Chief Executive Officer of ASATA. “Fuel is a cost of doing business for airlines and should be presented in the base fare so that South African consumers can see up front and in a transparent manner what they are paying towards airfare. “Consumers are also often not aware that the fuel surcharge or carrier-imposed surcharges are not a government-levied tax and would perhaps be less content to pay these if they knew that it was an attempt by the airline to recover what essentially is a direct cost to them doing business,” he said. Nevertheless, the landscape is slowly starting to change. British Airways no longer has a fuel surcharge on flights departing the UK and Europe and Qantas has bundled its fuel surcharge into the base fare. Recently, the Hong Kong Civil Aviation Authority ruled that airlines flying into the city would not be allowed to levy fuel surcharges. In response, Cathay Pacific has adjusted its base fare levels to incorporate the fuel costs. This is good news for the retail trade, as the increased base fare will be subject to the standard 1.01 percent commission. SAA has also adjusted its base fare for the route. “Self-regulation is the ideal situation for any business,” said Mr. Tlali. “However we also have to appreciate that, with the vast number of airlines and airports, as well as service providers worldwide, the business environment is so dynamic that at times the authorities have to take some decisions on the basis of their territorial circumstances. It should not be viewed as a punitive regulation, but as an administrative decision.” News Digest Cost of jet fuel in Africa hits airlines hard WHILE the falling rand/US dollar exchange rate has had an impact on local airlines forced to pay a number of input costs in foreign currency, it also affects local carriers which are forced to refuel in other parts of the continent. Although the oil price has fallen to a 12-year low, in many parts of Africa aviation fuel continues to be priced at a significant premium. “If you are buying a ticket for a flight that takes you out of the country, depending on the length of that flight, the aircraft may have to refuel and then the airline is paying in US dollars,” said aviation analyst Linden Birns. “Obviously one would like to have a consistent approach across the whole industry, but fuel is not sold at a standard price across all destinations.” That variation in the price of jet fuel can have a significant impact on the cost of a flight. For instance: on March 15, the average price for jet fuel at Cape Town International Airport was US$1.04 per gallon. In Harare, the cost was US$2.91 a gallon. At Lilongwe, it had climbed to US$3.75. Richard Bodin, fastjet Chief Commercial Officer said fluctuations are also often a result of extra transportation costs. “For one of our most popular destinations, all of that fuel comes by road from Dar es Salaam. It is a fairly long journey and there is a cost associated with that.” By comparison, he said, fuel in Johannesburg would cost considerably less. “Johannesburg is a very cheap place to buy fuel. The further away from the ports and refineries, it gets higher. And there are still certain governments that will see it as an opportunity to add taxes because they see air travel as a luxury...” “It (a fuel surcharge) is a stealth tax... They (airlines) are right in saying that the cost savings don’t always flow down to the consumer, that you don’t always get a straight line adjustment, but it should be included in the cost [of the product],” said Mr. Bodin.
  • As it stands, the fuel surcharge is here to stay, at least for local carriers. Whether it is bundled into the base airfare or listed as a separate charge is, so far, up to individual airlines. “The question of pricing, fares and surcharges in the airline business is what determines the competitive nature of the airline industry,” noted Chris Zweigenthal, Chief Executive of the Airlines Association of Southern Africa. “When passengers are considering travel options, they must look at the final fare and make their decision accordingly. The breakdown should always be provided, but ultimately the final amount payable is the comparison that the passenger should use to make their decision,” said Mr. Zweigenthal. TIR Southern Africa
  • April 2016 5 MARCO Ciocchetti, former Managing Director of Sandown Travel, has been appointed Chief Executive Officer of the XL Travel group, taking over from Chief Operating Officer, Rod Rutter, who is to retire after more than 10 years in the position. Mr. Ciocchetti was previously the president of the then Association of South African Travel Agents. He also played a role in the foundation of the XL Travel Group.

Mr. Rutter’s long-running career in travel included a term as Sales and Marketing Director and then Managing Director of American Express Travel. He will still play a supporting role at XL. “It has come to the stage where I want to take my foot off the accelerator... I am not riding off into the sunset. I will support Marco and be there for the agents... “XL is 15 percent of the market now. It has been a good journey – and I have had a lot of fun doing it. The market is changing... but I can still help the rest of the group,” Mr. Rutter said. XL appoints new CEO Pictured above right: Thompsons Holidays treated travel agents to a Sho’t Left experience last month on the Johannesburg City Sightseeing Bus and an afternoon at Gold Reef City to highlight domestic packaged experiences in the Thompsons portfolio.

Pictured below, enjoying the view from Africa’s highest building, Johannesburg’s Carlton Centre, during last month’s event (l to r): Melanie Leloup of South African Tourism; Henno Olivier, Cullinan Outbound Tourism; Sandra Cassim, Avis and Angela Wood from Thompsons Holidays.

Photos: Kate Els

Fuel charges face industry challenge - Travel Industry Review
  • www.tir.co.za THE GOOD Comment twitter.com/TIR_SA follow us on twitter EDITORIAL DIRECTOR John Wardall MANAGING EDITOR Sarah Cornwell Tel: 021 789 0053 Mob: 072 772 2189 sarah@tir.co.za ASSOCIATE EDITOR Dominic Wardall CONTRIBUTORS Richard Holmes Sarah Whiteside Kate Els PUBLISHER John Wardall ADVERTISING Dominic Wardall Tel: 021 789 0053 Mob: 082 620 6425 dominic@tir.co.za Andrew Watson Tel: 021 447 1724 Mob: 071 677 3858 andrew@tir.co.za CIRCULATION dominic@tir.co.za ACCOUNTS Beverley Gough Brenda Smith accounts@tir.co.za ADMINISTRATION Nerina Nicholson HEAD OFFICE 9 Ruby Terrace Noordhoek Cape Town PO Box 745 Noordhoek, 7979 Tel: 021 789 0053 REPRESENTATION UK: MW Media info@mwmedia.uk.com Europe: Colin Murdoch Thailand: World Media Co. Malaysia: Raffles Int. Media PRINTING Formeset Printers ©TTG Southern Africa 2016 Published by: TTG Southern Africa CC Reg no: 1995/030913/23 6 TIR Southern Africa
  • April 2016 THE BAD THE UGLY For a stockist near you, visit www.americantourister.co.za or call 031 266 0620 CONGRATULATIONS to Yolanda Barkhuizen, from Boland Travel in Paarl, who was spotted reading TIR in Junfraujoch, Switzerland. Yolanda is the lucky winner of a Lightway 55cm spinner suitcase by American Tourister, valued at R2,499! Introducting Lightway, the lightest softside collection by American Tourister. It doesn’t get any lighter than this! The Upright 48cm weighs only 1.2 kg and is ideal for a weekend getaway, while the full range features a contemporary, refreshing design, high durability and large volume. Thanks to its futuristic boxy shape and functional front pockets, the volume is up to its full potential. The TSA-approved key padlock ensures complete security. Lightway is bright, light and ready to roll! Choose from Anthracite, blue/light blue or Lava Red.

Industry View CORPORATE road warriors are becoming more and more conscious about their wellbeing and how much personal time is available when they travel for work, says Sebastien Carre, GM of the Four Seasons Hotel The Westcliff, who highlights the city hotel’s experiences and facilities for pleasure and leisure as the property’s competitive edge. Seasoned corporates seek better out-of-town experiences The move by ASATA to have fuel surcharges incorporated into basic air fares is in the interest of transparency. Fuel is a cost of doing business and lumping costs other than tax into the tax box is disingenuous.

Few passengers realise “tax” contains other charges.

The claim that SAA will make a profit in 2017 was dutifully reported in the media, with barely a tongue in cheek. It seems as ludicrous as Pravin Gordhan requesting yet another delay in reporting the airline’s 2015 financials. The umpteenth deadline was missed again last month. Tourism Minister Derek Hanekom is probably going to bite the dust after coming to the defence of Mcebisi Jonas in his allegations that the Guptas offered him the Finance Minister’s job saying: “There is no reason to doubt his version of events.” @AmTouristerSA Cruises and family holidays continue to grow THIS year is not a year when unsolicited business is going to be queuing around the block.

But neither was last year, and yet the cruise industry, a topic in this issue, had a remarkably good 2015, and not just at the lower end of the market.

Family holidays, another feature in this issue, is also a category of business which holds up well in tough economic times. The family holiday is sacrosanct and is above other discretionary spend and priorities, including a new car or television. Cruises and family holidays both provide the benefits of significant inclusions, free benefits for children and many available discounted sailings and packages. Globally, the cruise industry is expected to have grown nearly seven percent a year between 1990 and 2019. But there is still enormous potential for greater growth, as Cruise Market Watch points out that all of the cruise ships operating in the world at full capacity year-round would still only account for less than half the number of visitors to Las Vegas each year.

22,247,000 passengers took a cruise last year. There will be an estimated 24-million this year and more than 25-million by 2019. Statistics for South Africa are not as easy to come by but input from the cruise lines and cruise marketing organisations indicates this market is at least keeping pace with international growth, despite the rand.

The monitoring organisation said 15 more major new ships will be added to fleets during this year and next year, with 39,637 additional berths. There will be 521,000 berths by 2018. And ships added in 2015 and 2016 are forecast to increase annual revenues by US$3.6-billion and US$4- billion by 2018. That is an industry on the march. Family holidays are a major and growing segment in the travel market worldwide. They are recognised by all credible research organisations as forming the fastestgrowing segment of all types of travel.

Family groups commonly look for packages providing relaxation, outdoor activities and interesting sights.

Interestingly, the key for Chinese families is shopping. Globally, family travel accounts for about 30 percent of total leisure tourism. And increased longevity has boosted inter-generational holidays, with three generations travelling together, a phenomenon virtually unheard of as little as 25 years ago. Many of these holidays are centred around family events such as anniversaries, birthdays, weddings and reunions. Not only is the family market more resilient and determined to implement its travel aspirations and plans than other of travel group but it creates a growing future market, as children exposed to travel experiences from an early age form a key segment of growth by having the strong potential to become future customers.

An important consideration in communicating with older generations is what has become known as helicopter parents and grandparents, because they hover over their offspring, ready to contribute to their well-being and life experiences through shared activities, including travel. Despite everything, travel growth is unstoppable. Hotel management and meetings planners are giving more thought to the way corporate and leisure travel is overlapping to improve customer service levels and repeat business. At the Four Seasons Hotel The Westcliff, there is a growing trend to host business meetings on site.

Known internationally for a high standard of service and luxury, Four Seasons resorts and city hotels are each unique and generally designed to mirror their environment. The Four Seasons Hotel The Westcliff occupies a leafy hillside in one of Johannesburg’s traditionally affluent residential areas, while Mr. Carre talks positively about Johannesburg’s “urban revival”. Whereas the original Westcliff hotel was predominantly a leisure hotel for an older age group, the Four Seasons transformation, restaurants, spa and various meetings spaces are positioned as part an urban, mixed-use resort, which is open to the community.

80 percent of restaurant and spa goers are day/night-time visitors. “... Corporate and business travel is an affluent market... very conscious about their personal wellbeing and how much of their personal time is being invested... [and] generally people come to meet them. From the moment they arrive until the moment that they leave, they can combine their leisure and corporate needs... We also make sure that we diversify our experiences.” Four Seasons Hotel The Westcliff is the brand’s first hotel in South Africa. Mr. Carre has been with the company for almost 14 years and worked in various countries before transferring to Johannesburg and leading the redevelopment.

Between 10 an 12 other locations in and around South Africa are being considered for new properties, including Cape Town. “Half of our hotels are luxury resorts in exclusive resort locations,” Mr. Carre commented.

Johannesburg was an ideal launch site due to positive market conditions, he said, but also “the emergence of a strong, affluent upper-middle-class and luxury traveller that did not exist 15 to 20 years ago”. OR Tambo meant “from the onset, a very diversified clientele, business and leisure, not only long-haul international travel [but] also intra-African and domestic”. Foreign consular offices have provided another important stream of business. “We are in established markets but always look for new [areas] that are compatible with our brand... I have met representatives from a number of luxury brands...

who feel similar about the sub-continent and, for the same reasons, have a development strategy for southern Africa.” Here and abroad the high end of the market is still travelling, Mr. Carre maintained.

The very nature of the market is that people might change their spending patterns but, generally, they are more resilient to a downturn. “What you may see is someone who was staying in a very large suite may downscale slightly but they won’t stop travelling altogether. Lower down... they decide whether they will travel or not. Luxury is more sheltered. It is not that they aren’t

Fuel charges face industry challenge - Travel Industry Review
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Fuel charges face industry challenge - Travel Industry Review
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Fuel charges face industry challenge - Travel Industry Review
  • 10 TIR Southern Africa
  • April 2016 Pictured above: the M/S Dalmatia, one of the category A-plus motor sailing boats in Austria Connection’s line-up. All cabins have private facilities and air-conditioning. Retailersconvertmoreenquiries as product awareness improves BY RICHARD HOLMES & SARAH CORNWELL SPECIALIST GSAs continue to develop training, marketing and selling tools to grow the cruise business in this market. They maintain understanding the aspirations and concerns of a first-time cruise customer are key to closing a sale.

Austria Connection’s Dalmatian island-hopper itineraries are “extremely, extremely” popular, said company director, Inge Dobihal, who said availability was sometimes a challenge but that a varied product lineup was catering for a mix of budgets. For the South African market in particular, Croatia cruises are regarded as particularly good value. There are luxury boats for the high end, discerning traveller, Ms. Dobihal advised. Baby boomers are a major source of cruise business and Austria Connection’s Amadeus river cruise product is especially popular with this market. Ms. Dobihal reported 30 percent sales growth for Amadeus river cruises in 2015.

River cruising is totally different... These trips appeal to the market because of the only having to check in once because of the similarly aged passengers on board and also because passengers have access to all of the ship’s amenities at any time rather than having to travel in a confined space such as a plane or a bus.” Cruises on the Rhine, the Danube and Dutch and Belgian waterways during tulip season are Austria Connection’s top sellers when it comes to the seniors market. “Key to a successful sale would be a full assessment of the client’s needs,” suggested Gaynor Neill, Cruise Vacations General Manager.

For honeymooners or young-athearts with a slightly higher budget, Star Clippers offers a very special cruising experience. Luxury and highBut I’m going to get seasick! MODERN cruise ships are equipped with stabilisers that ensure a very smooth ride, even in rough seas. Forecasting and radar technology also allows ships to avoid areas of stormy weather. If your client is still concerned about seasickness, advise them to ask their pharmacist for motion sickness tablets.

budget guests love the intimacy of Silversea, with low passenger numbers and fully inclusive amenities, and the ultimate for adventure-seekers is Silversea Expeditions.” “Cruising is very diverse and appeals to various tastes and budgets... the key to a successful cruise sale is always in selling the right lifestyle and brand to the consumer,” said Thaybz Khan, Cruises International Brand Manager. “Once the agent has identified the client and the lifestyle the client prefers, it will be easy to then match the cruise line to them.” Convincing a client to opt for a cruise is also about calming any fears of the unknown.

Travellers who have never set foot onboard a cruise ship are often concerned about the crowds on board, easily allayed by explaining the size of modern vessels and variety of entertainment and relaxation spaces.

The truth of the matter is the ships are built to cater for these numbers and have multiple venues, attractions and options available to spread the crowd,” said Allan Foggitt, Director of Sales and Marketing for MSC Cruises. “Even on the busiest departure you will always be able to find a quiet private place to relax and read your book if you want to escape the party crowd.” Dress code and life on board can be a worry for first-time cruise travellers and “most cruise lines provide detailed FAQ’s which answer all these questions,” said Ms. Neill.

Some clients may raise an eyebrow at the initial cost of the cruise, but “at the moment cruising is the best-value holiday proposition travel agents can offer to their clients,” said Ms.

Khan. “One cannot do a seven-night land package in Europe, visiting more than just one destination, for the cost of a cruise.” Choosing the right destination is also important. The Mediterranean, Caribbean and cruises out of Dubai are a popular option for novice travellers, but the key is “to recommend a cruise that suits the client’s requirements and budget”, said Ms. Neill.

While beach-lovers may thrive in the Caribbean or the Balearic Islands, Ms. Neill said: “Mediterranean itineraries are ideal for guests looking for a balance of history, art and places of interest, with daily ports of call.” “The Mediterranean is always a popular destination with the Greek Isles being a popular choice,” agreed Ian Mathews, Sales and Marketing Manager, Triton Cape Sea Travel. “But, some passengers have a bucket list, including destinations like Alaska with a helicopter trip up to the glaciers.” If that sounds exotic for a first-time cruise client, MSC Cruises local sailings are a good introduction, as the cost of travelling to the embarkation point is low.

It is also important to remember that the ship is often a destination in itself. “For first time cruisers, the immense size of the ships is usually such a surprise that the ship becomes the destination and the itinerary secondary,” added Mr. Foggitt. “We regularly find that there are about 30 percent of the passengers who don’t disembark at all in a port of call.” Crystal Cruises’ new polar expedition megayacht, Crystal Endeavour (rendering left) will enter service in 2018, configured with 100 suites. It will be able to operate in Arctic, Antarctic and Fred. Olsen has updated the look of its fleet, painting the hull of each ship black (pictured below).

also tropical conditions and will be fitted with two helicopters for flightseeing expeditions, two seven-person submarines, electric amphibious zodiacs and other watersport equipment such as wave runner kayaks, scuba gear and its own decompression chamber. Amadeus River Cruises is adding a new premium vessel to its fleet this month, the MS Amadeus Silver III. The new vessel has 12 large suites with external balconies and 72 standard cabins, which, for the most part, feature panoramic windows which can be lowered. Austria Connection has a selection of excursion packages for Amadeus itineraries.

Photo: Crystal Cruises

  • TIR Southern Africa
  • April 2016 11 Agents should explain how gratuities work when booking BY RICHARD HOLMES GRATUITIES are often a cause of confusion and awkwardness for cruise travellers, with cruise lines one of the few sectors of the travel industry where a mandatory tip for good service is often paid before departure. It is an issue which should be clearly addressed by agents with their customers in advance. Adding to the confusion is a lack of consistency; some cruise lines levy a surcharge for gratuities ahead of departure, while others charge for them onboard. In some cases, gratuities are discretionary, although expected, and paid directly to onboard staff, with amounts recommended by the cruise lines. If service has been particularly poor, some lines may allow travellers to dispute paying them altogether.

The easiest and most comfortable for passengers is when there is a no-tipping policy, which is becoming more the norm with highend cruise lines, although the fares will reflect that policy. “On MSC Cruises tipping is a mandatory charge built into your cruise fare along with insurance,” explained Allan Foggitt, Director of Sales and Marketing. “It is paid upfront when you book your ticket, so [there are] no surprises on your bill when you check out.” Regent Seven Seas, Silversea, Scenic Cruises and Emerald Waterways all include gratuities in the cruise fare. “Gratuities on Carnival Cruise Lines are added and pre-paid,” said Gaynor Neill, General Manager of Cruise Vacations.

On Star Clippers [gratuities] are paid onboard, but a guideline amount per person is given.” Azamara, Crystal Cruises, Seabourn and Seadream all include gratuities in the cruise fare while Royal Caribbean and Celebrity Cruises charge a minimum gratuity over and above the cruise fare. The minimum gratuity for both is US$12.95 per person per day.

The cruise lines stipulate a minimum amount, which is a compulsory charge. If the client wishes to reward over and above this, they obviously can do so,” said Thaybz Khan, Brand Manager, Cruises International. It is also important to remember that the surcharge and conditions for gratuities may vary according to the individual cruise lines and the cabin reserved. On Carnival Cruise Lines infants under two years of age do not pay gratuities, while “with some cruise lines, the highest grades of cabins are charged a higher rate of gratuity”, noted Ian Mathews, Sales and Marketing Manager, Triton Cape Sea Travel.

But these grades get more service, such as butlers and concierge service.” Others, like MSC, charge a standard gratuity across all cabins, although this amount varies “from country to country, depending on where the ship is operating”, explained Mr. Foggitt.

Clients may ask why they cannot simply tip the crew members that deliver exceptional service onboard. The important thing to explain to clients here is that for every staff member serving your table, there could be three or four working hard behind closed doors. “There are so many crew on board performing important functions which are fundamental to one’s holiday, but without ever coming in contact with passengers,” explained Mr. Foggitt. On MSC, pre-paid gratuities are pooled and divided amongst all crew. However, if individual members of the crew deliver superlative service passengers are free to tip an additional amount, directly in cash or through the ship’s payment desk.

In cases where passengers feel they would like to reward a staff member who has impressed them, they should tip that individual directly whatever they feel appropriate,” suggested Mr. Foggitt. On the contrary, poor service could mean gratuities will be refunded or waived. Where cruise lines levy gratuities as an extra charge, “passengers are able to go to the reception and have the gratuities cancelled should they have a valid reason such as extremely bad service,” added Mr. Mathews. “But this does not happen much at all.” Rather than battling the gratuity charge, guests should rather remedy any service issues as soon as they Pictured (l to r): Samira Salih, Silversea Cruises Marketing Manager, Europe, Middle East and Africa, joined Annie-Claude Bergonzoli, Relais & Châteaux Africa & Indian Ocean Island Director and Gaynor Neill, GM of Cruise Vacations, Silversea’s GSA, onboard the Silver Cloud when the vessel docked in Cape Town last month.

The partners hosted a lunch and presentation in the only Relais & Châteaux restaurant at sea, Le-Champagne. The smallest of Silversea’s eight ships, Silver Cloud is to be refurbished in the second half of 2017 and converted for the expedition fleet.

Thaybz Khan, Cruises International Marketing Manager: Contemporary Brands is pictured (right) with the cruise agency’s sales award for Azamara, presented at the recent Royal Caribbean International Representative Conference in London. This was despite tough competition from competitor markets. Azamara’s two ships are small enough to berth at more ports and the line has introduced new ports and voyages for 2016, 2017 and 2018. occur, suggested Ms. Neill: “If a guest experiences poor service onboard for any reason, then this should be addressed by them onboard, giving the ship the opportunity to make right, as opposed to opting to hold back on gratuities.” Tipping is not compulsory on Amadeus’ river cruises.

  • 14 TIR Southern Africa
  • April 2016 affected or that spending patterns don’t change; they do... “The needs of the affluent traveller is in a constant flux... The reality is, we work with billionaires who are getting off private jets with holes in their jeans... A lot of it is about style and remaining relevant. “We cater to a much broader spectrum of clientele... families with kids, travellers of very different age groups. Being relevant to all these customers is a strength of the Four Seasons brand.

The city was not benefiting from the best reputation... It is very gratifying to see [hotel guests say] they should have stayed a little bit longer,” said Mr.

Carre. “People assume because it is a Johannesburg hotel that it is corporate but [guests are] connecting with a city that has an amazing revival to share... It is very obvious that our guests are connecting with those experiences and sharing them creates more word of mouth exposure for destinations. That is something we are very focused on.” Industry View Seasoned corporates seek better out-of-town experiences continued from page 6 An 18-month, US$56-million redevelopment of the Westcliff hotel was completed at the end of 2014. Work included a redecoration of all 117 guest rooms and suites, public spaces and the addition of new restaurants, lounges and a newly-built spa complex.

New government travel policy threatens agents CHANGES to government travel policies are expected to deal a major blow to travel agents’ bottom line, when they are revealed in detail BY SARAH CORNWELL and implemented later this month.

The government is looking to cut R1-billion per year in travel spend through the changes. Together with the anticipated changes, this could cost the retail industry as much as R2-billion in bookings, based on an industry estimate of the size of the market. It is understood that a standard remuneration model Briefly. Regent Seven Seas’ Seven Seas Navigator will operate a round-trip cruise from Cape Town to Mossel Bay on November 16 and on to Richard’s Bay, Maputo, Durban, East London, Port Elizabeth and Walvis Bay before returning to Cape Town on December 1. Fares are from US$8,799. Contact Encore Cruises.

and centrally negotiated supplier rate are being considered. President Jacob Zuma ordered a reduction in government travel during his State of the Nation Address in February. He said officials would have to “motivate strongly and prove the benefits to the country” when making travel arrangements and the size of delegations would also be “greatly reduced and standardised”. The Association of Southern African Travel Agents said last month it was in touch with the government and its members regarding the implications of the new plans. A new government contracting system was implemented in the second half of last year, with only ASATA members eligible to register on the country’s online central supplier database.

ASATA had also worked with the Treasury to develop a sourcing strategy for travel and accommodation, includNews Digest KWAZULU-NATAL is on a quest to increase the number of cruise ships calling at Durban. Industry leaders gathered onboard the MSC Sinfonia last month for the first local conference dedicated to growing cruise business, particularly in Durban. Thato Tsautse, Managing Director of eThekwini Municipality, said the cruise summit was intended to deliver specific goals and actions to ensure that Durban becomes “a far larger point on the world cruise tourism map”.

Durban’sfirstcruisesummittargetsgrowth BY SARAH CORNWELL MSC Cruises opened its 2016/17 South African programme with launch fares discounted by 50 percent. NCL opens its new resort-style port of call, Harvest Caye, in Belize this November. Shore excursions feature river rafting, nature walks and exploring Mayan ruins. Passengers can rent one of 11 air-conditioned private beach villas for the day, which will feature dedicated lounge and dining areas, indoor and outdoor showers, concierge service and exclusive dining and beverage options.

ing travel agents or TMCs, domestic accommodation, domestic car rental and domestic transport.

ASATA worked with Treasury for two years on a national framework and ASATA members were instrumental in putting that together,” said Otto de Vries, Chief Executive Officer, but declined to comment further. “This is a very serious situation,” cautioned Rod Rutter, XL Travel Chief Operating Officer, as it would “definitely affect the revenue streams of those agencies currently servicing government accounts. He said the group was waiting for direction from the government and feedback from its supply chain, including the national carrier (South African Airways) which is “currently government’s largest airline service provider”.

The need for clarity will also centre on many administrative variables that may affect service delivery and TMC income streams, he said.

Government accounts for approximately R4.6-billion of a total BSP (airline ticket sales) of around R18-billion. The travel and hospitality industry is a significant creator of jobs in South Africa, and contributes around six percent of GDP. We are hoping that this momentum of job creation continues and it would be in government’s interest to ensure that the industry maintains and grows its support for the national carrier through proper engagement with the various key role players,” Mr. Rutter maintained.

The Treasury did not respond to questions on the issue. Cunard to boost SA business with special local fares CUNARD is working with local GSA, White Star Cruise and Travel, on its future lineup with new special rand fares to strengthen the cruise line’s growing business from this market.

The fares have already been applied for Queen Victoria's Hong Kong ‒ Cape Town and Cape Town ‒ Fremantle sector cruises. The Queen Elizabeth made maiden calls to Cape Town and Port Elizabeth, en route to Fremantle, in February. With capacity for 2,000 passengers and 1,000 crew, Cunard’s agent said the ship left South Africa fully occupied.

Another significant development is the refurbishment of Queen Mary 2, getting underway next month, said White Star General Manager Shaun McCarthy. The ship is scheduled to arrive in South Africa on January 27, 2017, with the Queen Elizabeth to follow in April. To request a 2017 sales brochure, email: info@whitestar.co.za The Princess Grill suites and restaurants will be restyled. Grills benefits will provide access to two restaurants, which are both being reconfigured to offer more tables for two. Cunard plans to make it easier to differentiate between Queens Grill and Princess Grill restaurants through different designs.

More single staterooms are being added and there will be a new colour scheme, Mr. McCarthy revealed. “The Queen Mary 2 has been to South Africa a couple of times and was the favourite. And with Queen Elizabeth and Victoria having sold so well, the rates we have been given for the South African market are fantastic. [Cunard] also understands our rate of exchange but wants to keep growing our business.” Approximately 160 passengers were due to join Queen Victoria in Hong Kong for the vessel’s voyage to Cape Town arriving April 21, said Mr. McCarthy. Pictured right: (top) the enhanced Queens Grill suite design; (bottom) the Queen Mary 2 and Queen Elizabeth visit Sydney.

Alain St. Ange, Seychelles Minister of Tourism and Culture, was in South Africa recently to open a new tourism office in Johannesburg. “Passenger numbers from South Africa to the Seychelles were up in 2015 despite the difficult economic conditions and our forecasts for 2016 remain positive,” reported Sherin Naiken, STB Chief Executive Officer, pictured (above) alongside Mr. St. Ange. “Our purpose in opening a Johannesburgbased office is to further increase visibility and awareness about Seychelles in South Africa... we have identified strategic opportunities to connect with the rest of Africa from this location,” Ms.

Naiken added. The office is located in Ferndale, Johannesburg and will be run by Manager Lena Hoareau.

Fuel charges face industry challenge - Travel Industry Review Fuel charges face industry challenge - Travel Industry Review Fuel charges face industry challenge - Travel Industry Review
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