Why business travel matters more than ever in Asia  

The second day of ITB Asia’s conference panel kicked off with the Business Travel Plenary session. Adam Sacks, Managing Director of Tourism Economics, presented key research findings commissioned by the World Travel & Tourism Council (WTTC) on the economic impact of business travel (BT) in Asia Pacific.

The research sought answers to two main issues: what role business travel plays in driving corporate performance in the development of the global economy and if this is more or less true in Asia than the rest of the world.

BT was covered in five areas: generating sales, keeping customers, developing partnerships, spurring innovation and driving exports. Among the interesting findings are:

·         On average, executives report that 29% of their company’s new sales depend on BT (38% in China)

·         Over two thirds of executive travellers (70%) believe that BT is “extremely” or “very” important to innovation and to “added productivity/efficiency”

·         One additional dollar invested in international BT would, on average, generate 17 dollars in trade

·         A 10% increase in international BT would increase world trade on average by 3%

·         BT improves global corporate productivity, yielding an overall return on investment of 10:1

The main conclusions to draw from the study are:

·         BT and economic performance are interlinked

·         Sales, customer retention, partnerships, and innovation all benefit from investments in BT

·         BT is particularly effective at driving international trade, which yields broad economic benefits

·         Among world regions, Asian companies and economies generate the highest ROI per dollar invested in BT

·         Asia is most susceptible to reductions in BT

The corporate, trade and association panellists then shared their views and experience with BT policies and their practical implementation.

Lena Khoo, Vice President, Global Travel Department, Credit Suisse, said that the bank had reviewed its choice of airlines in each country from home carrier to first-tier carriers and changing accommodation from five-star to four-star hotels, as well as eliminating non-essential travel and mandating pre-trip approval.

“With some 4,000 people travelling, we won’t hesitate to look at cheaper options, such as special deals from hotels,” said Khoo.

However, while some global companies had switched to virtual meetings through telepresence, she said it was not always the best solution because of high installation cost in each office and sometimes, it just made more sense to travel instead.

Jack Morgan, Vice President Asia Pacific, Sabre Travel Network, said telepresence would not replace BT, but give companies more options. “We find corporations using their travel budgets for face-to-face meetings, but moving training and some customer meetings to alternative platforms, such as video- and tele-conferencing (VTC).”

He added: “Face-to-face meetings establish credibility and comfort in business dealings in Asia.”

Andy Tan, Vice President, Sales, Pan Pacific Hotels Group, cited their own experience as a case to support retaining BT. Their annual roadshow visits 16 cities across the region, and each visit generates between 45 to 55 sales leads, generating about US$200,000 in revenue.

Tan added: “In fact, it is possible to measure ROI. For instance, one should be able to assess most sales leads within two months; 20-25% ROI is quite common.”

Sim Beng Khoon, Regional Director, Asia Pacific for the Association of Corporate Travel Executives (ACTE), commented that the stage of a country’s development should be considered. For instance, face-to-face meetings are important in China not just to establish connections and build relationships but also reflected one’s status and rank in the organisation.

“There is prestige and ‘face’ to be gained in attending corporate meetings,” he said.

He added that companies also look at the total cost of travel in relation to executive time, and other issues such as safety. In an emergency or precarious situation, can you get real-time information on where your people are, and if they are affected, he asked.

Overview of association management in APAC

The second edition of Association Day took place today and started with a presentation by Greta Kotler, Chief Knowledge Officer of the American Society of Association Executives (ASAE). She summarised research done by Frost and Sullivan for a joint study by ASAE and the Singapore Exhibition and Convention Bureau which sought to build a database of association management professionals and associations and assesses the size and scope of associations in selected markets in Asia-Pacific.

The research covered professional, trade and philanthropic associations in six Asian countries – Australia, China, Hong Kong, India, Korea and Singapore.

Kotler said the overall findings showed that the Asia Pacific associations market is poised for continuous growth, and this will be supported by economic, industry and sector growth within each respective country and region. 

Associations identified a whole list of functions and their top current priorities. However, the most desired functions were:

•       Creating and disseminating standards of practice – Australia, Hong Kong, Singapore

•       Providing certification opportunities – India, Singapore

•       Providing training/professional development to members – Korea, Singapore

•       Catalyst to increase business opportunities for members            Singapore

•     Continued timely information to members and the public and connecting practitioners – China

Steven Yeo, Vice President, Healthcare Information and Management Systems Society (HIMSS) Asia & Middle East, spoke on Membership Recruitment and Retention.

Yeo described how HIMSS builds communities, what works well and the challenges the association faces, such as resources, geography, diverse cultures and local languages and international and in-country issues.

Dr Ajay Kakar, Secretary of the Indian Academy of Aesthetic & Cosmetic Dentistry and Vice President of the International Academy of Periodontology, then shared with delegates on Communicating the Value.

Kakar said that communicating value is not just delivering a standard message; it is about identifying what one perceives as valuable. “It is tailoring a specific, targeted message to a targeted audience member,” he said.

He suggested personalising and customising communication and to provide members with real information on specific deliverables.

Grooving to the content beat

Content is king and the king is far from dead. That was the message from the Web in Travel conference, ’Putting The Groove Back Into Content’. The panel agreed that online travel content went beyond user generated sites and there was demand for essential customised information.

“We have information available online that comes from all sources and most of these is available at low or no cost,” said Bikram S. Sohal, Vice President & General Manager of CNNGo, Turner International Asia Pacific. “However there is a need for content that is well-written and with authority that generates trust.”

“We have to customise information for web, application and mobile platforms and that requires considerable amount of input and cross platform engineering,” he explained.   

Echoing the sentiment, Giles Longhurst, Director, Frommer’s Unlimited, UK, explained that online content was not just about blog and review sites. “The connected traveller today wants to know more of what the destination has to offer than is physically possible to cover.”

“There is a gap between the ability to curate information versus ground sourcing. Travellers want content not just when they are planning their travel. They also want to know what is available in the city they’re in. If you’re in London and you step out the tube, you want to know what to do in the area around the station you’re at.”

Coming from a print background, one need not look upon the online media as a threat, said Daniel Quadt, Founder & CEO, GuideGecko, Singapore. “It is the mixture of thematic and the need to contextualise and give it a narration. The plan is to organise information in chunks so it can be pushed out the right way. For example, hotel property notes have to be done carefully as it is selling a product,” he explained.

However, the forum pointed out the proliferation of online media did not mean the demise of traditional media. An example of a crossover from the broadcast medium to print is the Discovery Channel Magazine.

Luke Clark, Launch Editor of Discovery Channel Magazine, Novus Media Solutions Asia explained that the channel commissioned approximately a billion dollars of content a year and there was a need to distribute advertising.

“Print will never fade away and the advent of online media has made the creative people more aware of the business. It is easier and more cost effective to integrate and produce quality content,” he clarified.

“All travel products have the potential to tell a story and the aim is to tell a good story. Don’t try to corporatize everything,” he said.

Hotels: boutique, unique, designed

Boutique hotels have been the preserve of small, independent properties, often at the upper end of the spectrum in terms of quality and service, or so they – and many people – believed. But now, the global hotel chains are joining the fray, and using their vast resources to get a piece of the pie.

Against this backdrop, the lively panel discussion saw a variety of opinions expressed, with comments from the audience adding spice to the proceedings.

The debate started with what defined a boutique hotel. Each member of the panel had different views: size, design, style, service, price...

Henry Maillet, General Manager of The Scarlet, Singapore stuck to the notion of a small property – “about 40 to 80 rooms, but not more than a hundred”.

However, David Lama, Area Director of Sales and Marketing Asia Pacific, Design Hotels Singapore, said a boutique hotel could be bigger but it must “integrate with the neighbourhood”.

This was probably good news to Arnaud Champenois, Brand Director, W Hotels and Le Méridien, Asia-Pacific, because many see Starwood’s entry (and other global chains in that league) as upsetting the little players’ turf.

Champenois said W hotels range from 300 to 500 rooms, with the focus being on design and theme, such as music or fashion that is unique to each location. “Each hotel provides quality service and a fantastic brand experience,” he said.

However, to Paul Kerr, President & CEO of Small Luxury Hotels of the World (SLH), boutique hotels are unique in that they are owned by individuals. “The owner stamps his or her personality, has a certain status in the locality and is able to open doors.”

He said larger hotels wanted to get into the space occupied by small hotels.

In terms of guest mix, Kerr estimated that among SLH’s 520 member hotels, it is 80% leisure. For W, it is a mix of both business and leisure, although when W Singapore opens in 2012, it is likely to be mostly leisure, due to its Sentosa Cove location.

Customer loyalty was another hot topic. While the Scarlet may be limited by the size of its property, it is able to leverage on its SLH membership. And although W has the Starwood Preferred Guest (SPG) programme as a powerful loyalty tool, Champenois said only 40% of W guests are SPG members.

He acknowledged, too, an attendee’s comment that hotels within the Starwood group may be competing for customers. “But each brand is distinct,” he said, “so one may stay at Sheraton for business during the week and at W for a weekend getaway.”

Lama commented that location is important, and boutique hotels are able to “target the mood of the person at the moment”.

Visitors from Asia encouraged to see more of Germany

A sophisticated and extensive network of high speed rail connections provides visitors the opportunity to see more of Germany and its varied and distinctive cities. Peter Blemengstengel, Regional Manager Asia and Australia, Deutsche Zentrale fur Tourismus e.V., gave buyers and delegates of ITB Asia an overview of lesser known cities of Germany such as Baden Baden, Neuschwanstein and Rothenburg ob der Tauber.

Travellers can fly to any of Germany’s gateway cities and link to other cities with German national rail operator Deutsche Bahn's 320 km/h high-speed Intercity Express (ICE) network. The service connects to major centres in Germany such as Frankfurt, Düsseldorf and Munich. It offers comfortable seating with on-board restaurant or bistro facilities. Trains depart and arrive in the middle of cities, saving valuable time of travelling from outlying airports.

"Asia is a huge important source market for inbound travel to Germany and I’m particularly pleased to see an increase of visitors from Japan despite all the problems that country faced," said Mr Blemengstengel.

Arrivals from Asia have been encouraging for Germany this year. More than 3.4 million overnight stays were recorded by visitors from the region in the first seven months of 2011. This was an increase of 15% over the same period last year.

Destination Germany scored particularly well with tourists from China and India. From January to July, visitor figures from mainland China recorded growth of about 27.5 per cent in overnight stays, while visitors from India rose by almost 25 per cent over the same period last year. 

Positive growth in overnight stays was also seen from Taiwan (25.7 per cent), South Korea (19.3 per cent) and Japan (12.4 per cent). 

The boom in visitors gives fresh impetus to German National Tourist Board (GNTB) to promote Destination Germany for the fourth time at ITB Asia this year. GNTB has partnered with seven industry partners to build on its marketing activities in the key source market of Asia.