Traditional tourism faces pressure from new type of visitor

In a post-pandemic era with more tourists wanting unique “off the beaten path offerings,” experiential tourism, therefore, requires not a resetting, but rather a reimagining of the entire tourism experience, Jamaican Tourism Minister Edmund Bartlett is advising.

And while he acknowledged this mode is a threat to the traditional tourism models like all inclusives, it is, however, an impetus to push the region’s tourism product further.

Speaking with the Business Guardian on the sidelines of the recently concluded World Free Zones conference, held at Montego Bay, Jamaica, Bartlett noted that all inclusive hotels could now discover that there’s need for new economic and business measures and even innovative ways of providing accommodation.

“The traditional feeling of going to a large hotel is disappearing fast as people are going to smaller and more exclusive engagements,” he explained.

Bartlett predicted the Airbnb sector will be a stronger player in the global accommodation sector.

The effect of this he added, is also significant as it means that more people can now enjoy experiences which will therefore, also help build the industry in several ways, including financially.

“So what we are going to see is there will be a diversification of ownership within the tourism space.

“That may not be a terrible thing as it may enable more ordinary citizens into the tourism value chain,” Bartlett added.

And T&T’s Tourism Minister Randall Mitchell also shared similar views to Bartlett that the traditional model of tourism should not be threatened by experiential tourism as they both strive to accomplish the same goal—to ensure a memorable visitor experience. Hence, he said both must find a way to operate in cognisance.

And as far as T&T goes, the minister said this country, by its very definition is largely “experiential” so it already presents an extremely unique opportunity to tap into that type of tourism.

“Because of what we have to offer in terms of community tourism; small scale cocoa and chocolate production, indigenous music and dance and culinary tourism experiences, Trinidad and Tobago is now more attractive,” Mitchell told BG.

He added, “In addition, a number of their guests are no longer drawn to the typical sun, sea and sand vacations because they have become mundane and passé.”

Additionally, he said as tourism returns to normal and whilst there’s a pent up demand for travel, visitors are looking for those intimate experiences that will help them create a connection they lost for the last two years during the pandemic.

T&T already has this advantage he argued.

“Because of our culture, heritage and historical connections we are well placed to provide visitors with tailor made experiences,” Mitchell reiterated, adding that this country has been promoting this aspect of tourism for quite some time with its many tours showcasing different aspects of T&T including culinary, heritage and nature.

According to Mitchell, these sentiments were also echoed during the recent Florida Caribbean Cruise Association Summit attended by the Ministry of Tourism, Tourism Trinidad Ltd and cruise executives. But how can local larger hotels integrate experiential tourism into their product?

Mitchell recommended that guests can have access to locally made items at retail shops in the hotels, proceeds of which are then reinvested into local community groups.

“This gives travellers the opportunity to take home a piece of the region and supports local artisans,” he said.

Also, the tourism minister said there should be engagement with local tour guides into crafting personalised or discounted tours which can be sold directly at hotels. Mitchell detailed that there are opportunities for all, directly or indirectly.

“Our economy would experience a much needed boost with the multiplier effect when tourists spend on unique, immersive experiences.

“There is also the advantage of the income staying and circulating within our local economy,” Mitchell explained.

Further, he noted that experiential tourism also raises awareness of local experiences and exposes visitors to a side of T&T that they are not readily exposed to.

This type of tourism also provides jobs for local communities and widens the stakeholder base because the non-traditional stakeholders now begin to benefit from those tourism receipts, Mitchell said.

“Communities such as Paramin, Moruga and Toco have welcomed visitors to their homes and lives and exposed them to their customs and heritage. “This is why the ministry, through its State agency, has invested in training and capacity building initiatives for these stakeholders to ensure improved service delivery and a more refined but still rustic tourism product,” Mitchell added.

He further noted that because experiential travel ties into the concept of bespoke experiences the Airbnb industry is also a part of this intimacy as it too provides that personal need for escape.

But given its popularity and attractiveness with lower rates, is Airbnb a threat to traditional hotels?

Noting that the tourism industry is very segmented, Mitchell said because of this, there are different elements of the tourism product which will appeal to various tourists.

However, he explained that what Airbnb has done is cater to a different demographic and offers a more personalized and customized experience. “As a result of the pandemic, visitors are more desirous of a more intimate experience due to the perception that such properties may be safer because of less potential of interacting with COVID-19,” Mitchell also noted.

He said even though hotels may experience reduced bookings, lower occupancy and reduced revenues because of increased destination room stock and competitive room rates offered by Airbnb properties, the overall impact is minimal as the volume of visitors diverted from traditional hotels with voluminous room stock may not be significant.

Additionally, Mitchell said Airbnb serves a very specific niche rather than competing with large branded hotels.

For example, he referenced that within the Caribbean, North America travellers, in particular those from the US, opt for longer stays while outperforming the traditional accommodation sector and even recovering faster in 2021 than traditional hotels.

On whether Government should regulate the Airbnb sector, Mitchell advised that the new revenue authority should have systems in place to ensure owners remit their fair share of income and or corporation tax where applicable, as well as property tax.

“This, of course it not to gain an unfair advantage over the more traditional accommodation properties whose room prices are impacted by the collection of hotel room tax,” the minister emphasised.

Additionally, Mitchell said there are concerns that the quality at some properties are not in keeping with international standards.

Lisa Shandilya General Manager of boutique property, The Chancellor Hotel located in St Ann’s also noted that Airbnb has marketed extensively over the years to be one of the formidable B2B platforms in the world.

Noting that the dynamics of this platform has changed, Shandilya explained this has aligned itself to other major online travel agency platforms, such as Booking or Expedia.

“Likewise other Apps have been developed over the past few years within destinations or regions. Airbnb and other shared property Apps tend to trigger lower rate offered to consumers as opposed to the more conventional platforms.Consumers seeking budget properties , or apartments will go to these sites,” Shandilya said.

Hence, she added that all platforms which offer inventory for commission, has threatened both travel agencies- which are almost extinct- and Government’s tax collection.

Shandilya also agreed that Airbnb and other shared platforms should be regulated, reiterating that they need to pay taxes and insurance for the safety of customers.

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