By Kathleen Cassedy

DESTINATION CASE STUDIES:
Aruba, Hong Kong, Maine, Branson

Crisis management was a prevalent theme at the conference following
perhaps the biggest crisis the U.S. travel industry has ever endured during
peacetime.

During the conference, tourism leaders from domestic destinations of
Maine and Branson, Missouri, and the international countries of Hong Kong and
Aruba presented their unique case studies of how the tragedy of September 11, 2001, impacted them. All initially lost business, except for Branson.

ARUBA

Horace Hord Jr., President and CEO of the Aruba Hotel & Tourism Association, points out that Aruba was struggling with its own set of problems in government and tourism several months before the terrible events of September 11. Although Aruba is part of The Netherlands Antilles, just off the coast of Venezuela, it has an autonomous government. The government had fallen in June 2001, causing the country to fall behind in paying its outstanding international debt, notes Hord, during his case study presentation on crisis management at the ATME conference last May.

That June it also became obvious that several of Aruba’s tourism markets
had softened, especially from Europe and Latin American, and the American
market was starting to slip. Tourist officials also noticed a strange
phenomenon: Aruba’s fastest growing travel segment was from households with annual incomes of only $30,000 to $35,000. Aruba targets households earning $75,000 or more, since that family can better afford an Aruban vacation, Hord notes.

When airlines in the U.S. were grounded on September 11, about 3,000
tourists were stranded on Aruba for four days. A crisis management team was
quickly assembled to put together and implement a crisis management plan. Its
immediate goal was to make tourists comfortable. The hotels, led by the Aruba
Hotel Association, provided complimentary rooms to their stranded guests for
the first two nights. Some hotels continued to offer free rooms for the next
nights, while others charged a discounted rate.

Tourists from the United States account for 65 percent of overnight visitors to the island. Return visitors account for 40 percent of Aruba’s tourism. Up to September 11, the island had done little advertising, depending on word-of-mouth referrals, Hord says.

KEEPING AIR SERVICE
Aruba enjoys nonstop service from Boston, New York City, Atlanta, and
Miami, on five U.S. carriers. When American Airlines considered dropping one
of its Miami flights, a delegation of Aruban government and tourist
officials, including Hord, personally visited American Airlines management,
and presented a financial incentive for American Airlines to keep the service
(and help to guarantee service from other airlines) by reducing its airport
landing and rental fees.

A Crisis Intervention Task Force was formed on September 18, 2001, with
included the president of the central bank, the managing director of the
Aruba Tourism Authority, and Hord as chairman.

The task force projected that if nothing was done to help tourism after
September 11, Aruba would lose 40 percent of its tourist business. Tourist
arrivals would drop by 7.3 percent in 2001 and 3.6 percent in 2002. About
1,200 people would also lose their jobs and the government’s financial
deficit would worsen. About 40 percent of Aruba’s hotel product are time
shares, whose occupancies were expected to remain high since they had already been purchased.

The Aruba Hotel Association and the telephone company, which is a public
utility, raised funds to pay the government’s outstanding bills. Finally a
new government was formed on September 28, 2001.

The government provided emergency funds to help address the lost of
tourism business after September 11.

STRENGTHEN MAJOR MARKETS
The task force’s developed both a short-term strategy to concentrate on
strengthening its major markets, which are the U.S.; Latin America,
particularly Venezuela; and the Netherlands.

"We wanted to increase the awareness of Aruba and maintain and reinforce
its brand image. This image sort of sells itself because Aruba is safe, it’s
out of the hurricane belt, and it’s easy to get to," Hord says. Aruba is
also a popular honeymoon destination, and on January 1, 2002, it became legal for Americans to be married in Aruba.

Marketing efforts involved:
• Use extensive databases to reach past visitors who might come again.
• Increase cooperative advertising with airline tour operators.
• Increase trade advertising to travel agents.
• Increase public relations efforts.
• Better promote aruba.com website.
• Raise money from the Aruba Hotel & Tourism Association to combine with
funds from the Aruba Tourist Authority to pay for the unique promotion,
"Aruba on Us," which targeted the U.S. market.

The "Aruba on Us" promotion, which ran from January through March 2001,
awarded 6,500 U.S. tourists to Aruba with $200 in American Express checks.
"Needless to say, it was a very successful promotion," Hord remarks.

The Aruba Tourist Authority invited its national sales people, and others
in the industry, to a conference designed to update them on what tourism
promotions and planning Aruba is doing, and to receive their feedback. From
this meeting, several initiatives were taken to build tourism to Aruba after
March 31, 2002.

WHAT’S AHEAD
A medium-term strategy, designed to be completed in 2002, includes the
following:

• Target new markets for growth, which include the United Kingdom, and the
southwest and western regions of the United States.
• Use inflight video advertising and more e-mail marketing.
• Market to cruise ship visitors by setting up a shop at the port of Aruba to
sell tour packages, and on-island packages that provide use of hotel and
beach facilities.
• Maintain the friendliness and multi-lingualism of the island.

"We are still facing external and economic climate that we can’t predict,
but in Aruba we have a very unique public-private partnership," which
includes a coalition of six major organizations, Hord says. "So when we go
to the government, we can speak with one voice."

HONG KONG

"The consumer is key," says Lily Shum, Regional Director-The Americas,
Hong Kong Tourist Board (HKTB), about how Hong Kong linked its marketing and public relations programs closely to consumer sentiment following the
September 11 tragedy.

Hotels supported HKTB by arranging extended stays for stranded guests
from the United States. After HKTB pulled all its advertising for the U.S.
market, its next step in crisis management was to assess the marketplace.
Information was sought from Hong Kong’s travel partners and by conducting
online consumer surveys for three months to determine why people had stopped international travel from October to January. Hong Kong learned that
consumers were worried about becoming stranded and the safety of long-haul
destinations.

With this information, Hong Kong created its action plan, says Shum.
Since the destination had suspended advertising, it concentrated on public
relations and a sales promotion that built a rapport with consumers. Shum
calls it a "soft" public relations approach which stressed that Hong Kong is
a safe destination.

Air travel from the United States, which is a major inbound market to
Hong Kong, accounts for 80,000 to 100,000 visitors, had declined by 30
percent after September 11. Shum points out that when international fares
drop to a certain price point, people will begin to travel again. "They
still may have reservations about flying, but they still will travel," she
notes.

HOT DEALS CAMPAIGN
A "Hot Deals" campaign was developed to attract business for the
short-term. Prices were dropped significantly to about one-third of the
normal price of a $1,700 round trip air fare from the United States to Hong
Kong. "We knew this price would not last forever, but we had to do something
to get the momentum to put travel [to Hong Kong] onto its normal travel
pattern," Shum says.

"Hot Deals" was marketed on Hong Kong’s website, through e-mails, and a
campaign with Travelocity. Hong Kong got help from its magazine partners who
provided email addresses, and a jump page appeared on Travelocity's website
to visit Hong Kong’s website.

By January 2002, people’s fears about travel had subsided, and they were
booking international travel again, Shum notes. Hong Kong decided to restart
advertising. An advertising campaign was launched on the Internet and on
direct TV in January and February to coincide with peoples’ booking patterns.
The ad’s message was "This price will not last forever."

By the time of the ATME conference in May 2002, travel patterns to Hong
Kong were still not back to previous figures, Shum says. Consumers are also
booking closer to their travel dates.

Hong Kong’s goal is to bring travel back to its pre-September 11 levels
and prices. The number of people traveling to Hong Kong by April was almost
par with the year before, but the fares were still heavily discounted (about
$900 round trip ticket in April).

Shum is pleased that Hong Kong’s crisis management helped to bring back
travelers in only six months, rather than the year turnaround that had been
projected. The second half of 2002 is predicted to grow faster than the
first half.

MAINE

On the afternoon of September 11, 2001, employees of the Maine government
office building were sent home as a precaution about rumors of more terrorist
attacks. The next day, Dann Lewis, Director, Maine Office of Tourism, met
with his staff to evaluate what impact the tragedy might have on Maine’s fall
tourist season. Advertising was halted, and the tourism office started to
collect information on group cancellations, including from United Kingdom and
German markets.

More than 90 percent of Maine’s visitors drive, of which the majority
arrive from eastern Massachusetts and the Boston-New York corridor.
"We hoped to salvage some of the fall season if we could act quickly
enough to contact those customers," Lewis recalls. The tourism office
partnered with the Maine Innkeepers Association, the Maine Tourism
Association, and the Maine Campground Operators Association to developed
value-added packages to promote on the state’s tourism website,
visitmaine.com.

"This was an unprecedented program since few Maine properties have
offered packages to either the travel trade or directly to consumers," Lewis
explains. "They suddenly had an incentive to do so."

HOT DEALS FALL GETAWAY
More than 120 packages were created and posted on Maine’s website as Hot
Deals Fall Getaways. On Monday, October 21, Maine’s Hot Deals were launched
with e-mails to 35,000 unique addresses that the tourism office had collected
recently for a different program. Within the first few days of the initial
delivery, more than 13,500 unique addressees opened their Hot Deals emails in HTML format, and 5,500 took action by clicking through the listings for a 39
percent clip-through rate.

E-MARKETING
The e-marketing campaign was initially planned as a short-term, one-time
program in an attempt to stimulate travel during October and November, Lewis
notes. "We could not track the actual sales, but response from the
participants and the properties themselves was so overwhelmingly positive
that our partners asked us to repeat the promotion for our winter season,"
Lewis says.

Maine’s 2001-2002 Winter Getaway promotion was launched on December 7,
2001, with 175 packages, which was one-third more packages than in the fall
promotion. Of the new packages, 90 were commissionable to travel agents, with a validity date through March 2002.

From the experience gained from the fall promotion, Maine tourism
officials could advise tourism and hospitality businesses on how to create
more effective package content. The tourism department also had acquired
more sophisticated tracking software that showed how many unique views each individual operator received. A blast email was sent to the tourism office’s
list, which had grown to over 36,000 addresses, and to an additional 2,500
addresses gathered by Maine’s travel partners.

The Winter Getaway program was also promoted on a free half-page ad in
the Sunday Boston Globe on December 9; and on free banner and skyscrapers ads displayed on the Globe’s Boston.com website, receiving 681,000 impressions.

Emails were sent to 10,000 state employees on December 10. And a public
relations campaign helped to expose the promotion to multiple media outlets
nationwide.

FROMMER PICKS UP PROMOTION
After the Maine Winter Getaway promotion was picked up by Arthur
Frommer’s website and its budget travel guide, the response was huge. "It
nearly blew out the server for the bed & breakfast [Frommer had
recommended]," Lewis says.

All of the publicity and marketing resulted in a complete sellout for the
packages in late December through January.

Capitalizing on the commissionable packages, Maine activated a "trade
only" website on January 4, 2002, which was promoted through a blast e-mail
to 41,000 travel agents in the United State and Canada, in small ads in
Travel Agent magazine in January and February 2002, and other public
relations activities.

By March 6, more than 120,000 individual packages had been sold. "Our
industry partners have asked us to make this an ongoing program," Lewis says.

"After a 9 percent drop in business in September, and a 16 percent
decline in October, we recorded an overall increase of 20 percent in
November, and finished 2001 several points ahead of the year 2000," Lewis
says.

In 2002, Maine’s tourism business was running three to five percentage
points ahead of last year. "Again, the entire market is certainly very
recent in terms of Maine, and we have noticed a very definite increase in
visitors coming from major metropolitan areas of the East Coast," Lewis says.
"We are currently exploring ways to improving our data capture and return on
investments measurements."

BRANSON

Not all tourist destinations suffered a loss of visitors as a result of the tragedy on September 11. Branson, Missouri, actually showed an increase over the year before. Perhaps the increase can be attributed to Branson’s location in America’s heartland appealing to a drive market (88 percent come by highway), when many Americans were afraid to fly. But another reason could be that Branson bills itself as a place that celebrates the American spirit, and in post-September 11, Americans felt renewed patriotism, and what better place to rediscover American values than in Branson.

EIGHT MILLION ANNUAL VISITORS
As a tourist destination, Branson is at the peak of its success, attracting 8 million visitors in 2001, and generating $1.7 billion in travel tourism revenues. This destination’s challenge lays ahead as its consumer base ages, notes Gary Noble, Vice President of Marketing for the Branson/Lake Area Chamber of Commerce. A third of Branson’s visitors are 65 or older.

Branson started attracting visitors a century ago as a popular camping and fishing destination, known for its scenic beauty. "The real Branson
explosion began in the 1980s when nationally known music acts concluded that they could be successful in Branson, and not have to endure the expense and pain of touring," Noble says. Today Branson not only offers outdoor
recreation activities, but is a huge entertainment and shopping venue,
featuring 49 theaters with 61,714 seats, 209 lodging facilities, 389
restaurants, two outlet malls, and dozens of other attractions and arcades.
Silver Dollar City theme park is Branson’s most popular attraction, receiving
2.2 million visitors a year.

In Missouri, one in 14 residents work in tourism, but in Branson, nine
out of 10 people work in the tourism industry.

In 2000, Branson experienced its first year of declining attendance. This
may be attributed to two ice storms, which resulted in a four percent decline
in visitation during its most popular season, the Ozark Mountain Christmas.
The next year in 2001, Branson attracted more than 7 million visitors. For
the three months following September 11, visitation was up more than the year before, and the overall visitation for the fourth quarter was up 10 percent
from 2000 numbers.

AGING VISITOR BASE
"It is nonstop middle-American fun for all," Noble explains. "…a thriving
and complete tourist destination. But there are many concerns over the
horizon," he confides. The average age of Branson’s visitors is 57 years
old, and 80 percent of visitors come 5.2 times. If Branson is to sustain
high visitation, it needs to attract larger numbers of younger people to
replace the older visitors who will be leaving. (Typically, few people over
age 75 travel.) According to Noble, a third of Branson’s visitors will stop
coming in the next decade. The challenge to marketers is to communicate the
benefits of Branson to more "boomers" and younger generations.

"Evolution, not revolution, is the theme for the marketing of Branson,"
Noble says. "It also appears that the audience may be evolving in our
direction."