CulturalTrends

Slide1 : (704) 677-4018 mobile byoung@youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Changing Trends Affecting Cultural & Heritage Travel Cultural & Heritage Tourism Alliance Conference Seattle, Washington December 1, 2007


Slide2 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Dynamic partnership Destination research and strategic planning Research for 100+ destinations in 26 states Small to mid sized communities Travel industry focused National research data and trends analysis Writing and speaking


Slide3 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 “It is not the strongest of the species that survives, nor the most intelligent, but the one that is most responsive to change.” - Charles Darwin 2007-08 = CHANGE


Slide4 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 2007 and Beyond Growth in 2007 and into 2008 finally outpacing 2000 levels- but it is a completely different world… …major traveler behavior change is forcing the travel industry to reinvent the experience!


Slide5 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Changing Consumer Behavior Twenty years of change (1986) CNN was new Compact Disc was new – cassettes going out Few households had a PC Internet??? Balsamic Vinegar and Sushi??? No frequent flyer miles Few luxury hotels Few fine dining restaurants No security…anywhere Videos were predicted to kill going to the movies


Slide6 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Ups and Downs Increase in leisure tourism, Lodging occupancies are up, BUT Decline in visitation to many historic sites Decline in attendance to many heritage attractions Increase at many theme parks Increase in retail shopping Increase in dining


Slide7 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 2007 and Beyond “If cultural and heritage tourism is so HOT? Why are my numbers NOT?”


Slide8 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 National Lodging Data Source: Smith Travel Research STR Report RTM 2007 projection = 63.7% (growth in inventory) ADR & RevPAR up! Less resort hotel building, more fractional ownership resort development


Slide9 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Airlines Source: Air Transport Association Prices below 2000 levels but going up 2005 Losses: $4.1 Billion 2006 Losses: $0.5 Billion U.S. Fleet 20% smaller 160,000 jobs cut since 2000 Fuel costs doubled over 2005 2007 projected profit = $5.1 Billion Airline Selection Criteria: Schedule/convenience-61% More leg room-11% Earning Flyer Miles-9% Price increases expected Source: Travelocity 12/06


Slide10 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Cruise Industry Cruise Lines (CLIA): Out-performed all travel segments since 2000 It’s easy! Formidable growth in 2007


Slide11 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Convention & Meeting U.S. Business/Convention Travel (domestic): Growth is driven by: Fun location (resorts, riverfronts, casinos, etc.) Convenience (walking scale once there) Unique experiences, events & great speakers/topics Cost containment


Slide12 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Domestic Leisure U.S. Leisure Travel (domestic person trips) (TIA): Increase has never faltered We all NEED to get away! Exploring UNIQUE places


Slide13 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Domestic Leisure Increases in Leisure travel “ Respite” Vacations demanded Growth in family travel Growth in affinity travel Attendance to many attractions is down Simplified planning, orientation & facilitation


Slide14 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Consumer Confidence Americans are cautiously optimistic FEB ‘07 – Oct ‘07 2000 - 2007


Slide15 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Sophisticated Travelers Trading Up Truckers drinking lattes Trends are changing at a faster rate Consumer is more demanding Providers of goods and services will have to stay on top of rapidly changing trends to survive Luxury experiences not for the rich alone Fine art/craft as souvenirs


Slide16 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Group Tour Great Potential for Rebound Affinity, affinity, affinity Last minute planning taking its toll Hard to sell-out per capita tour Custom designed for Baby Boomers or other age groups Freedom without the hassle, cruise ship on land Something you can’t get any other way Huge growth in student travel – now 25% of international travel (SYTA)


Slide17 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Attractions Challenges More to do…less time to do it Decline in attendance to many historic sites and museums 16,500 museums in U.S. 9,000 house museums in U.S. Boring vs. engaging Desire for less structure ½ price ticket & then sell food, beverage, retail “Store, Door & More” FUN


Slide18 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 House Museums New or through! Hearst Castle worst year in 20 years (USA Today) Biltmore Estate best year ever! It’s not the product… it’s the EXPERIENCE Requires constant reinvestment


Slide19 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Biltmore and more Major Business Units Destination Attraction Inn on Biltmore Estate Explore Biltmore Estate Biltmore Estate Wine Company Biltmore Estate Reproductions Inc. Key Statistics 1,000,000 visitors annually 140,000 cases of wine 42 licensees 66,000 room nights


Slide20 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Biltmore and more Key Statistics $117 million in revenue $350 million impact on community 10% – 12% return on sales 1,500 employees $12 million in taxes


Slide21 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Biltmore and more NEW TOURS, ATTRACTIONS, EVENTS… Downstairs Tour Behind the Scenes Christmas Festival of Flowers Winery Retail Dining Hotel


Slide22 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Biltmore and more


Slide23 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Biltmore and more William Amherst Vanderbilt Cecil “We don’t preserve Biltmore Estate to make money—we make money to preserve Biltmore Estate!”


Slide24 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Top Ten Trends for 2007-08 1. 2007 Continued growth in overall travel & tourism revenues Americans predicted to take 1,254.6 million domestic person trips in 2007, up 2.3% over 2006 (Source: IbisWorld) Americans view vacations as an essential part of contemporary life (Source: YPB&R/Y) We must learn the new behavior patterns


Slide25 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 2. Time Poverty – drives all trends More to do…less time to do it Expedia survey – 1/3 respondents didn’t take all of their vacation days Nearly 50% of all Americans report “time poverty” - report desire for all-inclusive to save time (Source: YPB&R/Y) Top Ten Trends for 2007-08


Slide26 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Last Minute Travel Who has time to plan anymore? Internet Visitor centers Signage Front-line training “MUST-SEES” Seeking unique experiences


Slide27 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Fragile consumer confidence will affect travel decisions Gas prices frustrate but don’t slow us down…yet! Real Estate downturn causes anxiety. Despite increasing costs, seven in 10 U.S. adults plan to take a summer vacation this year…. Even though airline ticket prices are increasing, 60% of respondents say they'll fly as much as they did last summer. (Source: Expedia.com) Top Ten Trends for 2007-08


Slide28 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 4. Traveler frustration Too many hassles No time to plan Airline complaints up up up Taxis and car rental Hotel check-in, room quality Attractions Dining Top Ten Trends for 2007-08


Slide29 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 5. Internet: #1 Travel is #1 in Internet use & sales Expedia survey (April 2007) summer vacation planning: Online travel agency (52%) Friend/family recommendation (45%) Travel guide books (25%) Travel community sites (19%) Magazines & newspapers (19%) Traditional travel agents (17%) Convention and Visitor Bureaus (16%) Top Ten Trends for 2007-08


Slide30 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 6. Geotourism -Increased traveler DEMAND for destinations that: > PROTECT THE AUTHENTICITY > AND GEOGRAPHIC CHARACTER OF PLACE > it’s environment, culture, aesthetics, heritage and the well being of residents. 55.1 Million Americans > sustainable tourists (source: TIA & National Geographic) GEOMAPPING – maps that are user friendly and provide geotourism information in the context of a scaled road map. Center for Sustainable Destinations – National Geographic Society Top Ten Trends for 2007-08


Slide31 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 7. Business Travel: Reluctant Growth Costs up, desire to travel down Service complaints up up up Unhappy business travelers Younger & more female Cost-contained travel On-line deal searching Top Ten Trends for 2007-08


Slide32 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 8. Generational Shifts Retiring Boomers GenX entering peak spending years GenY & MGeneration coming of age Develop “age-appeal” products Baby Boomers spending Affinity groups Family groups Top Ten Trends for 2007-08


Slide33 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Top Ten Trends for 2007-08


Slide34 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Embrace Change Baby Boomers 15 more good $$ years GenX is entering its peak spending years Younger Generations… …Are “deciders” “Technophilia”


Slide35 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Orientation & Facilitation are critical Travelers arriving with no plans Time Poverty drives the need CRITICAL COMPONENTS: - Gateways - Directional Signage - Visitor Centers (Thurs – Sun critical) - Kiosks - Front-line training - Padded maps everywhere Top Ten Trends for 2007-08


Slide36 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Orientation & Facilitation Gateways that create a sense of place A unique destination Visitors Centers = Sales Centers


Slide37 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 A New Travel Era Changing Generation groups = NEW traveler expectations “Transumers” consumers in transition - airports with shopping malls - retail in lodging rooms - Visitor centers as heritage centers - overnights at historic sites Top Ten Trends for 2007-08


Slide38 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Destination Challenge The definition of “vacation” has changed (Go/See/Do vs. Chill & Immerse) Travelers looking to escape Short getaways Year round travel Search for meaning


Slide39 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Other Trends Traveling with pets – (14% of all Americans) Safety & Security always an issue Team sports – huge growth – long term Diverse family – grandparents & more Nature travel Family reunion growth Huge Growth in RV Travel


Slide40 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Thriving amidst Change Research is the answer to grow with the new behavior patterns! Research as a foundation MUST know your customer! Market segmentation approach A focused plan for the community BE a unique destination


Slide41 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Walt Disney said: “You don’t build it for yourself. You ask the customer, and you build it for them.”


Slide42 : 704.677.4018 www.youngstrategies.com PO Box 12600, Charlotte, North Carolina 28220-2600 Want to know more? Berkeley Young byoung@youngstrategies.com 704-677-4018