Gary Sain, ATMEs Chairman and CMO & Partner of YPBR
and Mary Pat Sullivan, VP Marketing Communications, The Travel
Institute led a lively discussion with ATME Board Members and the attendees
on December 2nd. Here are the highlights from the discussion:
Bob Sharak, ATME Board Member and the EVP & CMO at CLIA
(Cruise Lines International Association representing 19 cruise lines
(95% of the industry) described 2004 as a banner year for the industry.
There were 10.5 million passengers. The industry added 12 ships in 2004
and 15 ships in 2003 (there will be 5 new ships added in 2005). Even
with all this new capacity occupancy was at 102%. Because of occupancy
rates prices are coming back up. And more importantly, yields are increasing.
There are 30,000,000 who say they would like to cruise who havent
yet. That pent up demand should increase yields even more.
The QM2s launch and massive public relations campaign raised the
bar for everyone in the industry.
When asked if there have been any shifts in the age of cruisers Bob
answered that they are slowly getting younger (no longer the nearly
dead). He also mentioned that the boomers are a big target for
the cruise industry.
Interesting Factoid: Sharak mentioned that cruises sold via travel
agents reaped the highest yields. The reason being that agents can easily
upsell a client to a higher price/level of service and the consumer
using a travel agent is less driven by bargain hunting than online consumers
tend to be.
Joel Chusid, ATME Board Member and Managing Director Sales &
Marketing, China Eastern Airlines gave a rundown on what the airlines
were doing from a marketing perspective.
Aer Lingus is becoming a low cost carrier across the Atlantic.
Virgin Atlantic, once marketed as a backpackers budget buy, is now
focusing on the redesign of its premium class and creating flat beds,
comic books for adults, massages in flight, limos to and from the airport,
etc. Their market is what theyve playfully coined the JetroSexual.
Singapore Airlines is going for the long haul with their new
18 hour non stop flight from New York to Singapore in the huge new Airbus.
Their challenge is to keep people occupied during such a long flight.
American Airlines which prefers the description network
carrier to legacy carrier is having a difficult time as are all the
legacy carriers managing rising fuel costs, labor unrest
(with possible strikes looming), high labor costs, and low fares, etc.
US Air, Delta, Continental, United, American and Northwest are all struggling
and at least one if not two will probably not survive. They all have
full planes but arent making any money because the yields are
so low and the expenses are so high.
Nevertheless, American is initiating a new touchy feely ad campaign
We know why you fly. To which someone in the audience muttered,
to be squeezed like a sardine and generally mistreated.)
And Song, Deltas in house budget high-style airline is
marketing to women reasoning that where the women go the men will follow.
Cheryl Scheideler, Director of Partner Marketing, Cendant TDS
announced that Cendant had just acquired another online company - EBookers
which adds to their market share with Orbitz, CheapTickets (Trip was
folded into CheapTickets). She mentioned that the brands will remain
separate. Cheryl sees the trend moving towards an expanded corporate
travel segment online and says the Group Meeting side will also expand
Scott Boone, ATME Board Member and CMO of TravelLeaders, sees
a trend toward one stop shopping for corporate travel. TravelLeaders
offers corporate accounts either a traditional agency experience or
a $15 per transaction solution. All corporate travel RFPs now
include Orbitz, Travelocity, Expedia, in the mix.
Chris Baum, ATME Board Member and Travel Marketing Director,
The New Yorker said that there is a higher spend committed to for 2005.
Theres more emphasis on branding, and many are going from 3 time
frequency to 6 and 9 times.
Jacqueline Johnson, ATME Board Member, and Executive Travel Director,
The Fairchild Bridal Group said that travel marketers overall budget
remains the same for 2005 but that they are going to other mediums and
cutting down on print programs in the process.
Joanne Nelson, Associate Publisher, Travel Professional mentioned
that trade advertising is coming back. Travel agents are stronger than
ever and marketers are realizing that they are important because the
yield on sales through travel agents is higher. She also mentioned that
electronic ad sales is now a profit center, no longer an add-on.
Joe Buhler, CEO, NetStrategic LLC said that as more clients are
seeing more profits they are interested in trying new things including
Hugh Riley, ATME Board Member and Director of Marketing, CTO
(Caribbean Tourism Organization) described what he considered a branding
dilemma. The Caribbean in general, versus each individual country. The
problem: How should countries spend their marketing dollars? For the
entire region or as an individual stand alone destination?
He continued by saying that there is a shift in the way destinations
market. The shift is from a primarily promotional organization to one
that must now close the sale as well. Now destinations have to have
booking engines on their websites or turn to the CTO to use its booking
engine. He concluded by saying that the region expects to end 2004 with
a 4-5% increase in visitors over the previous year.
One to One Marketing
Madigan Pratt, ATME Board Member and Managing Director, Madigan
Pratt & Associates, said that destinations and hotels are trying
to understand who their customers are. They are learning the importance
of database marketing.
Mary Pat Sullivan concurred by saying that The Travel Institute
used a one to one database driven message/marketing campaign over a
6 week period. In that 6 week period they achieved what would normally
have taken 9 months.