Travel Industry

On Nov 19, 2009, DHS Secretary Janet Napolitano announced the publication of new proposed rule that would establish the Global Entry Program as a permanent program.

Global Entry kiosks

The Global Entry Program uses biometric identification and expedites clearance of pre-approved, low-risk travelers into the United States. 

It is currently available as a pilot program at 20 U.S. international airports. According to the CBP, entry wait times are reduced by up to 70% for Global Entry participants.

Global Entry is open to citizens of the United States and lawful permanent residents of the United States, and it’s 27,000 members have logged in around 100,000 entries.

They’re also said to be mulling bilateral registered traveler program agreements with other nations including the United Kingdom, Germany and Mexico, so as to allow secure foreign travelers to use Global Entry. The U.S. already has such an arrangement with the Netherlands, which uses a similar program called Privium in Amsterdam.

The move was applauded by Roger Dow, president and CEO of the U.S. Travel Association, who commented that  ”A continued commitment to implementing world-class travel technology, efficiency and customer service will help the United States to attract millions of new visitors.”

At Global Entry kiosks, members insert their passport or lawful permanent resident card into a document reader, provide digital fingerprints for comparison with fingerprints on file, answer customs declaration questions on the kiosk’s touch-screen, and then present a transaction receipt to U.S. Customs and Border Protection (CBP) officers before leaving the inspection area.

The proposed rule announced on Nov 19 would end the current pilot and make Global Entry permanent—allowing CBP to expand the program to additional U.S. international airports, and ramp up public relations and cooperative partnerships with private industry. CBP aims to enroll 50,000 additional participants for Global Entry in 2010.

For more information about this and CBP’s other Trusted Traveler programs, visit www.globalentry.gov/

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a few cracks are appearing in American Express

Talk about playing hardball.

The Associated Press is reporting that American Express will start stripping  the frequent mileage/frequent stay points any co-branded card users earned that month if they don’t pay the bill on time. The new rule will affect Delta, JetBlue, Hilton Hotels and Starwood Hotels accounts.

It is possible to get them back, of course — for a $29 reinstatement fee on top of your late fee and penalty interest rate.  That’s a steep price to pay for a mistake. (And what’s with the odd number? It looks like a retail psychology ploy to keep folks from getting pissed you charged them $30.)

“I think over the course of time, people miss a payment at least once because of unforeseen circumstances like something getting lost in the mail or a long vacation taking your focus off making your payments,” John Ulzheimer, president of educational services for Credit.com went on record saying.

American Express’ spokesperson is calling this a way of incentivizing good behavior by essentially spanking you for bad habits. Other credit card companies are simply calling it harsh  — although they don’t dare say it that bluntly. Even as they look to solidify profits in front of the February 2010 federal rules prohibiting certain fees and interest rate, that’s not on their radars, they point out.

• Citi: Pay late one month and the associated points might not be available for redemption until the traveler and credit card company settle the bill. But so far, American Airlines and Hilton cobranded card holders are safe from reinstatement fees.

• JP Morgan Chase: Blow off paying the account on your cobranded United card and you won’t earn new points until you settle the balance.

Delta is on record as being OK with this, and early feedback from consumers at blogs is a shrug. Not paying your bills on time still lands in “socially unacceptable” category in general … except when it’s your payment that’s on the wrong side of the deadline, of course. But is it a bluff? Selling airline miles to partners creates a $5 billion a year profit flow for that industry — and like Ulzeheimer says, everyone misses a payment now and then. Taking away their points could eventually wash back to hurt the travel companies themselves.

It certainly isn’t taking anything off the table for American Express, unless card members decide to throw in their plastic and move to a different dealer.

Photography: pheezy (Flickr.com)

Rome Mayor Gianni Alemanno and Cinecitta Entertainment made an announcement Wednesday that work was to begin next year on Cinecitta World - a movie theme park which aims to replicate the success of Universal Studios Hollywood.

Cinecitta World

The first section of the park will be opened in 2011, with the full park slated for completion by 2014.

Cinecitta World, which comes with a price tag of $800 million, is to be created on 400 acres in a location south of Rome, at Castel Romano, and has set an ambitious target of attracting 4 million annual visitors.

The theme park will prominently feature attractions and rides based on classics filmed at Cinecitta Studios, such as Ben-Hur and Federico Fellini’s films. 

According to Emanuel Gout, President & CEO of Cinecitta World, the first section of the park, an area of about 25 hectares, will feature high-tech attractions, roller coasters, with real and virtual spaces dedicated to aquatic shows and special effects in movies.

Cinecitta Entertainment is aiming to turn it into the biggest theme park zone in Europe, with plans for a ‘Village’ with resort hotels, shops and restaurants. There’s going to be a Cinecittà World 2, and then a Cinecittà Nature - an huge ecological reserve where walking tours will combine with visits to film sets, since the area is frequently used as a backdrop for films.

The concept and creative side of the park is in the hands of Italian production designer Dante Ferretti – who has won Academy Awards for The Aviator and Sweeney Todd. Ferretti has designed seven of Martin Scorsese’s last eight movies.

The project has been ‘in the works’ for a long time now. The idea was first established in 1997, with the privatization of Cinecitta. In 2004, the plan was for an investment of 275 million euros, with a target of 2.5 million visitors. By March 2009, it had changed to 300 million euros, and now – the final figure is 500 million euros, with 4 million annual visitors.

Apparently the plan finally was set into motion after gaining the support of Gianni Alemanno – the Mayor of Rome. Mayor Alemanno explained his support (in Italian – translated) - ”The phenomenon of the theme parks has spread worldwide. But Italy and especially Rome has remained incredibly backward. It will become a synergy: who comes to visit the parks will stop to see the Roman Forum or the Colosseum and vice versa.”

A company – Cinecittà Parks, has been set up to operate the park, with an 80% ownership by Cinecittà Entertainment, and 20% by Generali Properties.

Cinecittà means ‘cinema city’ in Italian and it’s pronounced chee-nay chee-TAH. The studio has churned out more than 3000 productions, including recent productions like The Passion of The Christ, Gangs of New York, HBO’S Rome, The Life Aquatic, Miracle at St Anna and Dino de Laurentiis’ Decameron.

In the wake of falling prices and fewer fliers, airlines seem hellbent on irritating their customers as a fiscal strategy.

Apparently, the outcry against adding fees to flights on specific high-traffic days during the holidays wasn’t loud enough, because Delta, American and United announced yet more such because-we-can fees in 2010. Delta and United have carved out no less than 41 flying dates between January and May to slap an extra $30 onto the ticket as punishment for going on Spring Break when everyone else does. All three airlines announced $50 surcharges for select flights on February 8. Odd day? Not to those flying home from the Super Bowl in Miami.

Guess getting reamed $12 for a hot dog at Dolphin Stadium isn’t enough insult to loyal sports fans.

“This is becoming kind of a grab” for passengers’ cash, Robert W. Mann, president of consultant R.W. Mann & Co., told Bloomberg. “Nickel and diming in the form of $5 and $10 bills is really where it’s going.” But is it good business? Ask hotels, which are backing off from charging fees for every little service.

And it’s not as if they don’t have other revenue streams to explore. For starters, prices are steadying now, according to FareCompare. Similar travel-management companies are also predicting airfares will continue to rise in 2010, putting an end to the free fall drop in revenue.

American Airlines will dip its toe into retail sales on U.S. to London flights, peddling Heathrow Express train tickets. Its new inflight wi-fi service will promote online buying from SkyMall. After all, if you have the credit card reader on the back of the seat, they will buy. “We wouldn’t invest if we didn’t feel comfortable it would provide a fair rate of return,”  John Tiliacos, American Airlines’ managing director of onboard products, told a reporter from The New York Times. Reportedly, Broadway theaters and the Walt Disney Company want to elbow in on the action to sell their tickets on planes.

This direction fits right in with the snacks for sale, luggage charges and headset fees.

Then there are the behind-the-scenes moves, such as American Airlines and ARC’s partnership to develop an electronic tool that i.d.s duplicate bookings. The airline estimates these errors cost it “huge sums of money,” and considering the sums that pass through these companies in the first place, that figure must be large indeed to rate that kind of label from executives.

Yes, the recession is a bitch. Yes, the airlines weren’t in the black anyhow when the economy tanked. But at some point in your scramble to survive, you have to protect your future. At least these alternative ways of raising cash allow the customer a chance to decline and provide an extra service for their money. Tacking on fees for the heck of it is just tacky.

Photography: Mr. Usagi, jonathanb1989, psyberartist (Flickr.com)

At the premier online travel conference PhoCusWright 2009, 4 startups were selected by audience vote from a pool of 32 Travel Innovation Summit presenters to receive “Five Minutes of Fame” at the conference: EveryTrail, Gliider, Affinity Shopper from Amadeus IT Group, and Translations.com. Kevin May covered the entire Travel Innovation Summit event on Tnooz and wrote his quick reactions on each startup. Tim Hughes highlighted his 4 picks here (none of which won) and Stephen Joyce posted his 2 picks here and 1 here (none of which won).

Philip Wolf, CEO of PhoCusWright, has created a high-production value, entertaining, “American Idol” style event for travel startups. But after the sound and fury of the event is over, the morning after the parties are done, what really are the key travel technology trends that have been highlighted by these Innovation Summit presenters? I’ll focus on my take on that, and for the 6 readers who want to know my picks, you’ll have to read to the end of the post!

Summary: 7 trends and observations

===========================

Here’s my biggest takeaways from the event:

1. Mobile will open up new opportunities for in-trip planning, shopping, and booking.
2. Sensors, system data, and geolocation-tagged data will be everywhere
3. An Epic Battle over the social web is ensuing between Facebook and Google, creating opportunities for all
4. Online search and discovery is still the biggest problem in travel planning and shopping (in other words plenty of need for the kind of stuff UpTake is doing)
5. The industry continues to focus on using data to drive better ad targeting and site conversion.
6. Social media is changing travel marketing, distribution, and customer service, and new tools are being created to help companies monitor and manage this new channel.
7. Many consumer-oriented startups still seem to be in the “build it and they will come” approach toward traffic acquisition. C’mon, don’t do that to yourself.  Stop it. Now.

1. Mobile Opening Up In-Trip Planning, Shopping, and Booking

In-trip planning, shopping, and buying via mobile is a clear opportunity. We believe that for every $1 spent on air, car, and hotel, there is another $2-3 spent on attractions, activities, restaurants, and other services at the destination. Mobile planning, shopping and booking will become a key tool for travelers to use when on their travels.

CarTrawler painted an intriguing scenario of last-minute comparison shopping for your rental car on your mobile phone. Currently, rental car reservations don’t carry a penalty for cancellation. CarTrawler allows you to access latest car rental rates so you can shop for a better deal while you’re waiting for your luggage at the baggage carousel!

The CarTrawler concept could be applied to any product that has expiring inventory and some kind of yield management. For example, travelers can make travel plans while they are on their trip on services like nightlife, entertainment, casinos, restaurants, tours, and attractions.

EveryTrail, one of the 4 winners, allows hikers to share waypoints and geolocation data as they hike and upload this to a trip plan or trail map. That data can then be used by others to do in-trip planning in the future. While the application and site is focused on hiking and trails, the same model could be applied toward other itineraries that would create maps useful for in-trip planning.

2. Sensors. System Data, and Geolocation-Tagged Data Everywhere

==================================================

Imagine a world filled with people uploading geolocation-tagged data from their mobile phones. EveryTrail founder Joost Schreve shared a quote from Google’s Eric Schmidt that mobile allows for magical things to happen:

The mobile platforms, Android and the others, are so powerful now that you can build client apps that do magical things that are connected with the cloud. This is I think the most visually obvious example of that…don’t limit your imagination to this set of problems. Anything where you can produce this phenomenal customer benefit when you have a mobile device broadly defined connected to the cloud….

(is  “Minority Report” advertising in our future?  Photo credit: PR via Guardian UK)

EveryTrail claims that 1000 trails are already being uploaded each day to EveryTrail. With increasing applications and increasing smartphone penetration, one can imagine a massive amount of geolocation-tagged data being uploaded by people on their mobile devices.

On top of that, imagine a world with sensors everywhere, that automatically publish data on objects in the physical world. In addition to user-uploaded photos, videos, reviews, and other content, sensors could publish the location and status of buses, trains and rental cars. Imagine other information, such as restaurant wait times by party size, tour/attraction availability and price, event ticket availability, and other travel services also publishing status information into the cloud to be accessed from mobile devices.

Processing all this data from sensors and from people in a way that creates useful applications will be a huge opportunity and challenge. Vanguard ID Systems tantalized us with some “vaporware” – RFID tags that could track the location of your bags at all points.

3. Epic battle between Facebook and Google for the one Web ID Ring that will Rule Them All.

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An epic battle is brewing between Facebook and Google to control the key standards and services of the social web. An example of that is Google Friend Connect and Facebook Connect, both of which want to provide a lightweight single-sign-on to all Websites. In other words, the One Ring To Rule Them All.  Jeremiah Owyang of Altimeter Group has written extensively about Google’s Stealth Social Network and how Facebook is having to open up to compete. At this point, it appears that Facebook has a commanding lead in driving adoption of a useful single-sign-on standard that also provides exciting direct marketing opportunities to travel Websites.

This epic battle will create opportunities for online travel companies in 2 ways.

First, access to Facebook and Google data will enable companies to run direct-marketing campaigns to drive customer acquisition and repeat purchase. Facebook just recently announced a policy change where sites integrating Facebook Connect can request users to authorize Facebook to provide the user’s email address to the site.

Second, travel companies will be able to use technology to participate in what I call “social discovery.” Social discovery means learning about something from watching what your friends do, or asking your friends for advice and recommendations. In the opening keynote, PhoCusWright’s Philip Wolf talked about social search, which implies integration of Twitter and Facebook into Google or Bing search results. The concept of social discovery includes social search in Google or Bing, but also a more serendipitous sharing of recommendations from inside of Facebook.

The companies that seem to have the biggest opportunity to insert themselves into the social discovery process is Localyte, EveryTrail, TourAbout, and Gliider. Localyte is a social network of local “experts” (basically anyone who wants to dispense advice) and travelers looking to connect with a local. Tips and advice could be posted to the Facebook news feed and thus drive new users to the Localyte site. EveryTrail allows the posting of trip status into the Facebook news feed, and Gliider allows you to ask your friends for advice, which could drive further application adoption.

Gliider, one of the 4 winners, is a browser plug-in that allows you to bookmark the information you get from across the Web into a trip portfolio that can be used for pre-trip decision making. They seek to make money by having users discover targeted deals and offers without their application. Honestly, I’m not sure if this really a company—it feels more like a product or even a feature of a product. But they have already integrated Facebook Connect so you can ask your friends for advice, and that’s a smart way to use Facebook.

TourAbout seeks to build a “social marketplace” of local tour and attraction providers which combines aggregated content on those travel products with the social recommendations you get from friends. Stephen Joyce wrote extensively about this company and appears to have a Internet crush on this company:

The concept is simple, and one that I have been advocating for some time; engage with potential customers by building social equity through the sharing of expertise.

The opportunity for operators is two fold: firstly, the operator gets to create a profile page that allows them to showcase their tours, their areas of expertise, and humanizes them.

Secondly, the operators get to answer questions posted by travelers that fit their areas of expertise and build relationships both passively and actively.

The social marketplace allows independent operators to overcome a major hurdle with marketing, primarily the question of credibility. By answering questions in the marketplace, the operator builds social equity and credibility.

I want to learn more.  I’ll update this post after I talk to the company.  I wasn’t paying attention during their demo.  I talked to the company.  Now I understand.  They are creating a database of tour operators, activity providers, and destination specialists and helping them play in the social space.  The way they intend to do that is by creating a Q&A community for travelers where suppliers are welcome to provide answers and information to consumers, including travel “insights” which are basically tips and advice.  They do sentiment analysis and automatic tagging of all the content to make it easy to find, and to organize similar questions together.  This “social marketplace” will include the “social” features, like Q&A on the site and via Facebook and Twitter, but also a “marketplace” where leads can be sent to activity providers and operators.

4. Search and Discovery Still The Biggest Problem/Opportunity for Travel

======================================================

UpTake’s perspective has always been that “Web search is broken” for travel and needs to be fixed. At PhoCusWright, I heard Google reaffirm their research that people conduct 12 searches and visit 22 sites before booking. After watching a number of Travel Innovation presenters, I’m convinced there are still big opportunities to improve in search and discovery in all areas of travel.

Amadeus IT Group, one of the 4 winners, highlighted a new map based search called “Affinity Shopper” for the 18-30% of people (I heard various stats) who start the planning process without knowing exactly where they want to go. This is a big problem that needs to be solved, and it is relatively less rewarding to solve it because those customers may be further up the purchase decision funnel and less likely to convert. Amadeus’ “Affinity Shopper” also seemed to include additional filters and information to serve the customer who is just starting the travel planning process. Their launch customer is Lufthansa, who showed how a map-based, and interest-based search might work.

Voyij is focusing on aggregating and organizing deal content. They highlighted Twitter as a real-time channel where deals are being pushed by suppliers and intermediaries. In reality, whether or not Twitter becomes a dominant channel for deals, the social web is likely to become more fragmented over time and the need for a specialized aggregator to bring content together in a searchable way is likely to increase.

Goby had one of the most compelling demos of the day. They are also addressing a need that UpTake has focused on, helping Web searchers figure out what to do and where to go. Goby has a very nice map-based, proximity search feature that helps you decide what activities to do based on proximity to your starting point. TripAdvisor has a similar feature but it is buried and hard to find. Is this proximity search a signature feature that will differentiate Goby from the pack of other aggregators (including UpTake)?

Other startups that are also addressing search and discovery include search engine service provider Exalead. the complex itinerary optimization engine YourTour (from the unfortunately named company deciZium, probably the worst company name I have ever come into contact with), and even Limo aggregator site CheapLimoRates.com.

Looks like a few other startups, and the PhoCusWright selection committee, concur with our position that “search is still broken.” Of course, these companies still need to have a traffic strategy, which in my opinion needs to be focused on Google, Facebook, or both.

5. The industry continues to focus on using data to drive better ad targeting and site conversion

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Several startups are helping advertisers do better contextual targeting on publisher sites, and better merchandising to improve site conversion. Tim Hughes at BOOT and Tnooz already wrote extensively about this in his post about his 4 top picks and how this trend relates to what he calls “EveryYou” concept.  EveryYou goes beyond the concept of the Long Tail:

The Long Tail is based on matching the unconstrained supply of the Internet to niche demand. What is missing is that the niche demand in Long Tail theory is constrained because it depends on knowledge. That is, someone can only demand a niche product if they know about it and believe that they like it (or could like it). For unconstrained niche demand you need to have a systematic and automated means of making trusted and targeted recommendations to someone. This is the EveryYou principle. Using the four dimensions of data we now have on people interacting with our sites (breadth), the different things an individual does on a site (depth), the interrelation between the data we have one person and others (context) and the freely provided data we have unrelated to transactions (community) we can develop a specific and targeted recommendation of one based on the unique combination of desires, needs and interests of each individual at any moment in time.

Matching demand to supply using data is the trend illustrated by several companies:  Dapper and X+1.  Here’s how these companies are described:

Dapper:  “Travel advertisers have a constantly changing inventory, and Dapper Ads allow them to connect their travel offers in real-time to their display ad campaigns. Dapper Ads’ intent engine uses a combination of real-time bidding and geo, behavioural, semantic and contextual cues to decide exactly which impressions to buy, and then which offer from your website inventory to show in the ad creative, each time the ad loads.”

X+1: “x+1 makes online media and marketing more effective by identifying highly valuable customers and prospects and serving up relevant content on ad units, sites and landing pages. x+1 products enable online marketers to reach their target audience anywhere on the web. Site+1 is an audience management solution that automatically assembles data about customers and chooses the statistically optimal messaging to show each visitor in order to drive more profitable site visits.”

I’m not smart enough to figure out exactly what they are saying, but there you have it.  Contact Tim Hughes for more on this topic!

6. Social media is changing travel marketing, distribution, and customer service, and new tools are being created to help companies monitor and manage this new channel

==============================================================

Another aspect of data is Three companies showed travel-industry oriented social media monitoring tools. I’ll again quote Kevin’s post:

10Best / VinePulse – “10Best’s knowledge about the travel and hospitality industry is reflected in VinePulse, an industry-unique social media reputation monitoring and response tool. VinePulse offers a user-friendly, flexible, comprehensive dashboard that allows all the stakeholders – from corporate managers, to regional managers, down to individual property managers – to listen and interact.”

iPerceptions – “The unique integration of Voice of Cusotmer survey data with corresponding behavioural/clickstream data, delivered through an advanced interactive dashboard. The most innovative version of this integration is made possible by matching relevant session-level Google Analytics raw data with matching individual VoC survey responses, as opposed to the commonly available aggregated data.”

eBuzzConnect – “EBuzz Connect is a online social media management system for hotels, restaurants and businesses to monitor and manage their online reputation and social media channels from an integrated single interface. The system enables hotels to respond to reviews and comments from the tool whenever the channels offer capabilities for hotels to respond. In addition to social media channels, eBuzz Connect also monitors online travel agency channels such as Expedia and Travelocity.”

This is an important trend that is not confined to the travel industry. From a business model standpoint, I am much less excited about this but I’m sure there is plenty of opportunity for lots of vendors in this space.  It doesn’t feel like a winner-take-all opportunity and I expect this space to be very fragmented and very professional-services oriented.  Also, I think travel industry focused solutions will compete with more generalized tools and services.

7. Pet Peeve: many consumer-oriented travel startups still have “Field of Dreams” approach toward traffic

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Travel Innovators are either keeping their consumer acquisition strategy very close to the vest or there is a bit of “field of dreams” inherent in these plans. I think it is a bit of both.  Traffic acquisition is the most important driver of success and that strategy should be clearly evident.

Take CheapLimoRates.com. They claim to be the first aggregator of the fragmented, $10 billion limo industry. But how are they going to be found?

What about Goby.com? Extremely appealing but I didn’t hear about how they were going to drive traffic, other than the core appeal of their respective concepts. Other than SEO-friendly URLs, I didn’t see any new acquisition tactics built into their product concept. Voyij is another product where I didn’t immediately see new and different acquisition tactics. Headed by online travel veterans from SideStep, I’m confident they will come up with something. Twitter deal aggregation is very interesting as a core product concept, but I also would like to see how Voyij could publish tweets to a user’s Twitter feed that would result in Followers seeing a viral message that would get more people to come to Voyij.

(Disclosure: UpTake is in discussions on or have established a co-marketing relationship with both Goby and Voyij, so we know a little more than I’m writing here.)

I was befuddled by how Gliider could get traffic so I asked Jordan Stolper, CEO and Co-Founder of Gliider. He responded that OTA and publisher partnerships was the key way he would drive adoption of his tool…a key dependency to their model. Partnerships are also central to TripIt’s consumer acquisition strategy, according to Gregg Brockway, founder and President of TripIt.  Gliider will need to execute on the same strategy as TripIt with a planning widget as compared to TripIt’s itinerary management widget.

Only EveryTrail talked about Facebook integration and how publishing information into the Facebook news feed. By streaming EveryTrail uploads into the news feed, consumer can share what they are doing with their friends and make people aware of EveryTrail. Facebook to iPhone conversion rate is limited to the incidence of iPhone.

Localyte does seem to have built in acquisition into their product. Their signup process has an aggressive “invite your friends” to drive adoption. Unfortunately, you cannot connect your Facebook account until you set up a Localyte account.

The company also claims some incredible adoption numbers: 40,000 local experts producing 20 million new words a month, equivalent to 80,000 250-word articles per month. That seems hard to believe, and is amazing if true. Localyte’s SEO metrics (page rank, backlinks, indexed pages) and Compete.com traffic seem low relative to this kind of content creation.

Still reading? Wow. I’m honored by the 3-4 people that are reading this sentence. As a thank you, my treat on breakfast or lunch in Palo Alto! (must register for this promotion by Dec 1 by emailing Elliott at ngventures dot com)

OK, here’s my picks

==============

EveryTrail is by far the most interesting new play, that combines mobile sharing of geolocation-tagged content (photos, waypoints), mobile trip planning, and Facebook Connect viral marketing. Goby, Voyij, and Amadeus IT’s “Affinity Shopper” are my other picks because they are part of the same good cause that UpTake is on to improve search and discovery in travel! Congrats to all the new travel startups!

On Tuesday, SPI – the Plastics Industry Trade Association, announced that it is dumping Chicago, and shifting NPE – their plastics industry trade show, to the Orange County Convention Center in Orlando, Florida for 2012 and 2015.  

McCormick Place, Chicago

Founded by SPI in 1946, NPE has taken place at Chicago’s McCormick Place since 1971.

The organizers justified the move to abandon Chicago by citing savings of over $20 million for both exhibitors and attendees, with more than half of that coming from lower travel related expenses in Orlando, including for hotel rooms, restaurant meals and parking.

SPI conducted a study this year by comparing costs of the 2009 show in Chicago – which was held in June with 44,000 attendees and total spending on the local economy worth over $95 million, against projected costs for NPE2012 in Orlando. Turns out they would end up saving 23% on lodging and 11% for travel.

SPI’s announcement comes on the heels of a similar backout by the Healthcare Information & Management Systems Society, which shifted its 2012 venue from Chicago to Las Vegas.

Orlando and Las Vegas, which have seen their own share of lost conventions and corporate events over the last year due to the AIG Effect, will no doubt be happy to be at the recieving end for once – and hopefully, this will serve as an example to other corporate groups, and put an end to the AIG Effect.

As for Chicago (and other labor strongholds), this signals the start of a ‘Reverse AIG Effect.’ At a time when destinations and travel companies are offering heavy discounts and deals to attract Conventions and kick-start the Meetings & Events sector, labor strong-holds are being left behind due to the inability to cut costs and reduce workforce.

Chicago Mayor Daley called the loss of the NPE and HIMSS trade shows “a very serious loss” and called for changes at McCormick Place – Chicago’s Convention Center. In response, officials from McPier – which operates the convention center, and ChooseChicago – Chicago’s Convention Bureau, are meeting on Wednesday with Labor and representatives for the city’s restaurant and hotel owners.

This joint taskforce is expected to set aside their differences and come up with a plan to make McCormick Place and Chicago a more competitive destination for Conventions and trade shows.

For the workers, it looks like a no-win situation – They’ll have to give up hard-fought ground on a host of issues – from work rule changes to benefits, layoffs and unionization - if they agree to cooperate. And if they don’t – they’ll likely end up losing  more jobs in the future and having to make even bigger concessions, as other trade shows and conventions follow suit and give up on Chicago.

Photo by Rob Jacob

At 10.00 am on Nov 19, 2009, the U.S. House Committee on Foreign Affairs is going to hold a hearing titled ‘Is it Time to Lift the Ban on Travel to Cuba? This is the first hearing on this matter since after the Democrats took over Congress. And even before the hearing commences, the battle has already begun in the media.

US Congress Hearing - Cuba Travel Ban

House Foreign Affairs Committee Chairman Howard Berman (D-CA) penned a joint piece with Senator Richard Lugar (R-IN) in the Miami Herald.

In the article, Rep. Berman & Sen. Lugar say that “U.S. travelers’ dollars could aid the underground economy and the small self-employed sector permitted by the state, strengthening an important foundation of independence from Cuba’s authoritarian system.”

They close with the statement that “Sometimes a travel ban may be necessary, but nothing about the Cuba situation today justifies such an infringement on our basic liberties.”

Orbitz Worldwide, which launched the OpenCuba.org petition in May 2009 in support of removing travel restrictions to Cuba, chipped in with the announcement that the petition drive had collected over 100,000 signatures.

Barney Harford, president and CEO of Orbitz Worldwide is quoted in the Havana Times as saying that ”Never before in the history of the U.S. ban on travel to Cuba has there been such an upwelling of popular support for change.”

On the other side, Bloomberg News came up with a piece which claims that a repeal of the travel ban without scrapping the overall trade embargo would end up putting the money spent by US travelers to Cuba into the hands of non-US travel companies like Spain based Sol Media, which manages 24 hotels in Cuba. 

The article claims that, on the contrary, opening up Cuba for US travelers would drain tourists and revenue from US providers on other Caribbean resorts.

Legislation to repeal the travel ban on Cuba – The Freedom to Travel to Cuba Act – has been introduced in both the U.S. House (H.R. 874) and Senate (S. 428).

The House also has pending legislation (H.R. 188 – Cuba Reconciliation Act) to scrap the entire trade embargo. Most US based travel companies, inspite of being denied access to the market, favor repeal of the travel ban as a first step in the battle to end the trade embargo.

A middle way would be for Congress to throw in an amendment exempting US based travel and hospitality companies from the trade embargo, so that they can set up operations in Cuba and cash in on the rush of US travelers heading for a vacation in Havana.

In September, the US Govt. amended the laws to allow US telecom companies to offer their services in Cuba. Something similar could possibly be worked out for selected travel companies. They would, of course, need similar approval from Cuba.

Witnesses providing testimony at the hearing on Thursday include Retired General Barry R. McCaffrey, of BR McCaffrey Associates, LLC; Ambassador James Cason – former Chief of Mission in Havana; and Ms. Berta Antunez – Sister of former political prisoner Jorge Luis Garcia.

US Capitol photo by cliff1066; T-shirt photo by FutureAtlas.com via flickr (creative commons)

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I like it when a business doesn’t define itself too narrowly. So it’s a round of applause this morning for Starwood Hotels and Resorts and Marriott International as they get into the teleconferencing game.

Yes, you read that right. Hotels, which traditionally have made their money by luring executives to meet face to face in their conference rooms, and thus stay overnight in their rooms, are now saying it’s OK to stay home. Instead, the profit stream comes from renting a high-tech telepresence room to talk to colleagues around the world.

Telepresence: face-to-face while miles apart

Executives get a break twice: first in the obvious travel costs and second by sidestepping the need to purchase the telepresence equipment themselves. According to reports, it costs roughly $500 an hour to rent a technology room at these hotel chains, which is a far cry richer than the $259 per night with less labor. Of course, they’re missing the chance to grab an extra $12 for Internet connection and $30 on parking.

Starwood and Marriott are eyeing a shot at events like job interviews, legal depositions and smaller meetings. Starwood has targeted its properties in New York, Sydney (Australia), Toronto, Los Angeles and Chicago for the telepresence capabilities; Marriott, too, will launch the service in New York with 24 more to follow in San Francisco, Washington, Hong Kong, Shanghai, Frankfurt and London. They are both working with Cisco on the sophisticated conference rooms.

“As the 24/7 world economy becomes more interconnected, the need to hold small global meetings that cross continents and oceans will only grow,” says Arne Sorenson, president and COO, Marriott International. “We believe telepresence will create more business meetings because people can travel shorter distances and easily connect with colleagues and clients around the world. The addition of telepresence meeting suites in our hotels will give Marriott a leg up on its competition.”

Starwoods’ response: “Because of the decentralized nature of business today, without public room deployments, telepresence can never achieve the critical mass needed to realize the full potential of this exciting video technology.”

Meanwhile, according to the New York Times, American Express and Carlson Wagonlit Travel want to jump in by offering consulting services to help business clients decide when to rent a telepresence suite and when to take the old-fashioned “get a room” approach.

I guess thinking outside the box is contagious.

Photography: edans (Flickr)

When a botched tourism promotion campaign goes viral, it’s not a pretty sight. Listed below are the top 5 roadkills, in terms of destination tourism promotion campaigns, where the media message quickly spiralled out of control once the campaign was launched.

Kalona, Iowa - Arrest a Traveler

Kalona, Iowa – Arrest a Traveler campaign – The Kalona Chamber of Commerce teamed up with the Washington County Sherriff’s office to cook up a tourism campaign (see video) where the police would wave down and ‘arrest’ an out-of-state traveler passing through on Highway 218. 

The arrested traveler would then be offered a free overnight stay in Kalona, along with free gas, t-shirts and a bucketload of other freebies contributed by local merchants. Once news about the campaign broke in the media, it quickly turned into a civil rights controversy, with allegations of abuse of power and fourth amendment violations. 

End result: Instead of positive media buzz about the surprise free stay in Kalona, the image the town has acquired now is one of police excess. Safe to say that Kalona won’t be arresting any more travelers.

VisitDenmark - 1 night stand video

VisitDenmark – One Night Stand Video - Denmark’s tourism agency put up a video on youtube, along with a website, featuring a woman with a baby begging for help, in which she says that the baby was a result of a drunken one night stand, and she doesn’t know who the father is.

The woman, called Karen in the video, is actually an actress named Ditte Arnth Jorgensen and the baby wasn’t hers.  According to VisitDenmark manager Dorte Kiilerich, the intent had been to tell “a nice and sweet story about a grown-up woman who lives in a free society and accepts the consequences of her actions.”

End result: A storm of criticism – with the media accusing VisitDenmark of portraying Danish women as having loose morals. The video has since been removed from youtube and the website no longer exists. You can still see the video here.

New Mexico - Alien ads

New Mexico – Alien Tourism Ads - New Mexico aired state sponsored 30 second ads featuring reptilian aliens talking about visiting New Mexico, apparently in a bid to position New Mexico as the ‘Best Place in the Universe.’

 The creators of the ad – M&C Saatchi (Santa Monica office), forgot to mention one thing in the ad - the Roswell UFO landing - New Mexico’s one and only connection to aliens from outer space, and the most famous UFO themed site in the US.

End result:  It appeared as if New Mexico was portraying visitors as ugly aliens. It didn’t do one bit of good for N.M. tourism, and instead ended up confusing a lot of people who saw the ads, and didn’t know about Roswell.

Australia 'Bloody Hell' ad

Australia – So Where the Bloody Hell are You? Ad Campaign – This ad, also created by M&C Saatchi (Sydney office), starts with a barkeeper saying “we’ve poured you a beer” and ends with model Lara Bingle in a bikini on the beach at Fingal Spit asking “So where the bloody hell are you?”

The U.K. banned the ad for the use of the word ‘bloody.’ The ban was revoked after a personal intervention by Australia’s tourism minister, but it was then banned from being displayed on billboards. Canada banned the ad for the unbranded alcohol in the beginning, and also for the use of the word ‘hell.’ In some countries, it was run without the words ‘bloody hell’  – Simple ‘So where are you?’

End result: An international disaster – The Bingle ad branded Australia as a land of profanity, and in countries where the profanity was removed from the ad, it just didn’t make much sense. Either way, the campaign was declared a massive failure, and pulled.

Maxim - Women of the Israeli Defense Forces

Israel – Women of the Israeli Defense Forces Maxim photo spread - In an effort to divert attention away from all the negative imagery of war and fighting, the Israeli consulate in New York and the tourism ministry combined to cook up a plan to sponsor a Maxim photog’s visit to Israel.

The photographer was put together with beautiful women who at one time or other had served in Israel’s military, and were willing to be photographed for Maxim.

End result: Outrage in Israel’s Knesset at the objectification of Israeli  servicewomen, a loss of image as the Holy Land for religious tourists, and more fuel for resentment between Israel and its neighbours.

Oh beautiful for spacious skies

Tracking organizations say the rate of decreases in international tourism is slowing  — or, put another way,  fewer folks are not globetrotting lately, which lends hope these numbers could climb out of the red and into the black in the near future.

According to the United Nations World Tourism Organization’s World Tourism Barometer report, the number of international tourists declined 7 percent in the first 8 months of 2009. But because the bleeding is beginning to taper off to the tune of only 3 percent in the hold during July and August, UNWTO is guessing the final decrease for this year will be 5 percent.

We’re still talking big numbers of course — 600 million visitors worldwide compared to the 643 international visitors countries usually welcome. And it’s understandable, given the poor economic conditions in previously strong countries and a  flu pandemic. It’s just not acceptable to countries that rely on these visitors’ dollars (which shrank 10 percent during those same 8 months, making it an even more dismal story than the head count)  to keep their own employment bases strong.

How hard were countries hit? Stats from the World Tourism Barometer:

In Europe (-8 percent), destinations in Central and Eastern Europe were the most affected, but results for all other subregions were close to the average.
o        Asia and the Pacific (-5 percent) shows the clearest signs of improvement with growth already positive in August driven by the encouraging results of North-East Asia.
o        In the Americas (-7 percent) there are still no clear signs of a reversal in the current decline trend. Growth continued to be fairly negative during the second quarter as well as in the months of July and August. South America has shown the best performance so far (-1 percent).
o        The Middle East (-8 percent), though still well down on the growth levels of previous years, already saw a shift to positive growth between June and September (data for the region is fairly volatile due to the influence of major religious events in tourism flows).
o        Africa’s growth (+4 percent) was very positive given the current difficult environment.

$10 to see

So, since its travel industry seems to be suffering the most on this list, what is the United States government doing to improve the situation? If you ask the European Parliment, that would be pissing off the foreign tourists it needs. EU lawmakers are requesting that Secretary of Homeland Security Janet Napolitano  lead the charge against a likely $10 visa waiver registration fee passed by Congress but not yet signed into law by President Obama. Oh, they’re upset with the online visa waiver, too, but slapping a $10 charge to the process has apparently rubbed salt in the wound.

According to MSNBC, Napolitano is willing to discuss this airline passenger paperwork thing, but, uh … we need that $10. “Unlike many of your countries, the United States does not have a separate agency to promote tourism and travel, and so the goal of this is to use that to actually fund and help tourists and travelers who wish to come to the United States,” Napolitano reportedly responded. “In that respect I think that it is not only reasonable but in these days of reduced government budgets, it’s the way to fund that.”

MSNBC says that EU lawmakers are angry because we American’s don’t have to pay these fees and jump through these hoops on their end. No, we just have to justify a  dollar sinking against the Euro with our personal budgets.

How sure is UNWTO that these numbers will improve?

Photography: Julie Sturgeon