The Visitor Economy: The Next Frontier

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The Visitor Economy The Next Frontier Image (c):Planet for Kids Nova Scotia Innovation Days 29 April 2014 with Dr. Nancy Arsenault, Tourism Cafe Canada (c) Dr. Nancy Arsenault (2014). Thank-you Nova Scotia (ERDT & NSTA) for having me back! Louisbourg & Cape Breton Up With People GMIST Edgies!

description

My keynote address delivered at the Nova Scotia Innovation Days, 29 April 2014. The experience. It’s all a rage in marketing, product development, organizational change, but what does it really mean? For over a decade now we have heard that managing the experience is the next competitive battlefield and a choice for businesses to differentiate and add value. To succeed in the new Visitor Economy truly requires understanding your customers and potentially having the courage to change how you do business. Its an opportunity, a choice, and it applies to any type of business or organization.

Transcript of The Visitor Economy: The Next Frontier

Page 1: The Visitor Economy:  The Next Frontier

The Visitor Economy!

The

Nex

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ontie

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Image (c):Planet for Kids

Nova Scotia Innovation Days29 April 2014

with Dr. Nancy Arsenault, Tourism Cafe Canada

(c) Dr. Nancy Arsenault (2014).

Thank-you

Nova Scotia(ERDT & NSTA)

for having me back!

Louisbourg & Cape Breton

Up With People

GMISTEdgies!

Page 2: The Visitor Economy:  The Next Frontier

(c) Dr. Nancy Arsenault (2014).

Text

Image: www.idtec.com

We work in the best industry in the world!

(c) Dr. Nancy Arsenault (2014).

Full of Passionate People!

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(c) Dr. Nancy Arsenault (2014).

And it doesn’t hurt that ...

16 million visitors 1.8 million visitors

614,000 jobs 24,000 jobs

157,000 businesses $800M income to NS families

Enhances our reputation when visitors have an amazing experience!Enhances our reputation when visitors have an amazing experience!

(c) Dr. Nancy Arsenault (2014).

We are Revenue Positive to Government!

An investment in tourismis an investment in a healthy economy.

$84 Billion economic activity

21.3 B Tax benefits

$2 Billion industry!

$173M tax revenue

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(c) Dr. Nancy Arsenault (2014).

Not to mention the Community Pride

Text

Tourism Business of the Year 2013Widden Park Campground, Antigonish

Community Service Award 2013Delta Barrington & Halifax Hotel

Staff

Ambassador Award 2013Fortress of Louisbourg Association

(c) Dr. Nancy Arsenault (2014).

But We Have Some Challenges

... but perhaps influence

Those we can’t control

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(c) Dr. Nancy Arsenault (2014).

But there’s a lot we can do!

If we choose change!

Many Canadian companies choose to do business in the same markets they’ve operated in for years … Working with familiar clients and markets is a comfortable option, and in the short-term, it may reduce risk … but over the long term, playing it safe can cause companies to loose their edge.

Deloitte’s Passport To Growth (2013)

(c) Dr. Nancy Arsenault (2014).

Are We Our Biggest Enemy?

Image: success.com

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(c) Dr. Nancy Arsenault (2014).

Your Neighbor isn’t Your Competitor

3 to 5 words are!

Boutique, pet-friendly, accommodations, Halifax

18 Properties on Trip Advisor18 on Pet Friendly Digs

34 on Expedia...

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(c) Dr. Nancy Arsenault (2014).

Two Visitor Centres in One Small Town

• I don’t understand why?

• Do I have to visit both?

• Will they be different? Tell me something new?

Image: ishopeco.com

(c) Dr. Nancy Arsenault (2014).

Sorry I can’t help you right now

I’m filling out another grant application for funding.

Image: cdn.youthnet.org

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(c) Dr. Nancy Arsenault (2014).

The Race to the Bottom

Think discount rather than adding value

The Time is Now

The economic and population challenges we now face in Nova Scotia, and dramatically so

in our rural regions, demand new vision, innovative approaches, greater collaboration and a greater willingness to take on the risks associated with economic change and progress.

Ray Ivany (2014). Now or Never

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(c) Dr. Nancy Arsenault (2014).

Minister, Michael Samson

Tourism is:

• About people, the customer, their experience

• A major economic driver - $2 billion!

• Being recognized across all sectors of government as important

• Government and industry making the right investments needed to grow.

“Marketing will get them here, our hospitality and experience will bring them back.”

In his address to the provincial Visitor Servicing team 25 Apr 2014

(c) Dr. Nancy Arsenault (2014).

Yet the convincing others about the value of tourism is tough

Everyones a traveller but few understand how our industry works ... even some in our industry!

Image: latinbusiness.com

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(c) Dr. Nancy Arsenault (2014).

Your CEO, Patrick Sullivan

• We can’t keep doing the same as we have for the last 10 years

• No silver bullet

• Inspirational marketing

• “Discover, Freedom, Engagement”

• Increase the value, the revenue generated, the length of stay

In his address to the provincial Visitor Servicing team 25 Apr 2014

(c) Dr. Nancy Arsenault (2014).

Have we put ourselves in too many boxes?

Marketing

Visitor Services

Product Development

Training

Research

Stuff!

Federal

RegionalMunicipal

Associations

Provincial

Business

Tourism

HotelsRestaurantsAttractions

Transportation

DMOs

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(c) Dr. Nancy Arsenault (2014).

And lost sight of the customer?

Marketing

Visitor Services

Product Development

Training

Research

Stuff!

Federal

RegionalMunicipal

Provincial

Business

Tourism

HotelsRestaurants

Attractions

Transportation

DMOs

(c) Dr. Nancy Arsenault (2014).

Maybe it’s time to take a step back

Look at the bigger picture ... and dream

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(c) Dr. Nancy Arsenault (2014).

(c) Dr. Nancy Arsenault (2014).

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(c) Dr. Nancy Arsenault (2014).

Walk boldly

but carefully

(c) Dr. Nancy Arsenault (2014).

The E-Factor!

• Visitor Excitement

• Visitor Experience

• Visitor Engagement

• Visitor EconomyThe Visitor is in the

Drivers Seat!

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(c) Dr. Nancy Arsenault (2014).

An Opportunity to Truly Focus On

Customer

Experience

Competing on

ValueVisitor

Economy

Thenext

competitivebattleground.

1. The Customer Experience

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(c) Dr. Nancy Arsenault (2014).

A Great Customer Experience

The visitor’s experience is the cumulative impact of all physical, emotional and practical encounters guests & prospects have with companies and the destination.

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It’s travel that’s

• authentic, • memorable • engages the senses, • is inherently personal and• connects on physical,

emotional, spiritual, intellectual, or social level.

Source: Nancy Arsenault (2004)

Experiential Travel

Free Wheeling Adventures

“Seeing the sights is no longer enough.

More than ever people are travelling their

passions.”

Joe Diaz, Afar Magazine

Investing in stories over infrastructure is:

Everyone has a story to tell

... more engaging

... more personal

... authentically yours

... make connections

... flexible/dynamic

AND

... quicker to market

... attracts media

... can charge more

... builds HR capacity

... less expensive

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(c) Dr. Nancy Arsenault (2014).

But it begins with really knowing the VISITOR

Then focusing your thinking, investment approach and product development and promotional activities through the eyes of the traveller.

2. Compete on Value

Engagethe Senses

Local Flavor

Authentic

Connect with Chefs,

FarmersVintners

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(c) Dr. Nancy Arsenault (2014).

Canada MUST Compete on Value

“Value is the immunization factor. When there is no

difference in value people buy on price alone. ”

Competing on value allows you to create a ‘be different’ strategy that your competitors will have difficulty

copying.”Roy Osing (2009). Be Different or Be Dead.

(c) Dr. Nancy Arsenault (2014).

We’ve known this for a long time ...

Beggars Banquet, Louisbourg

Canada must develop niche products and services tailor-made to match the unique characteristics of its diverse regions.

Deloitte’s Destination Canada: Are We Doing Enough (2007)

Solider for a Day, Halifax Citadel

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www.ediblecanada.com

Edible Canada

Connecting with what people really want ... the chef & conversation!

Edible Canada, Vancouver, BCwww.ediblecanada.com

Food ingredients (Commodities)

Culinary Artisan Store(Goods)

Restaurant Dining (Service)

Market Price Premium Price

$40, $80, $120 & $750

Competitive Positioning

Pricing & Profits

Low VolumeHigh Yield

High VolumeLow Yield

Greater Differentiation,

Emotion, & Engagement

No to Low Differentiation,

Emotion, & Engagement

Experiences!

Mains $24 - $33

Most $3 - $50

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Group Size 2 to 8People

Cost $40 pp

Cultural Explorers

Foodies !

Group Size 8 to 12People

Cost $750 pp

Targeting Niche market foodies who want to

experience the west coast by

kayak

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3. The Visitor Economy

Broader than the Tourism

Economy

Tourism(Economy

What’s(the(Difference?

Value Creation

Visitor(Economy

Tourism(as(one(element(of(sustainable(communi:es

For businesses

For Visitors

For communities

Sustainable(Tourism

For businesses

For Visitors

For destinations

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What’s(the(Difference?

Value Creation

Visitor(Economy Tourism(as(one(element(of(sustainable(communi:es

For businesses

For Visitors

For communities/government

For destinations

WOW guests, earn a living, successful business

Memorable Experiences

Healthy Economy

Deliver on the brand promise

Encompasses everything that attracts visitors to a destination and

makes a place special, distinctive and is capable of

engendering pride and interest in a place worth experiencing.

The(Visitor(Economy

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Partner(Differently!

Visitor(Economy

Stimulus Investment

Pot

Tourism(as(one(element(of(sustainable(communi:es

Municipal Affairs

Tourism

Environment

Fisheries and Oceans

Product / Experience/ Industry/Community

Development

Marketing

Research

Managing&the&Visitor&Ecomony

It&is&a&con3nuous&process&of&researching,&inves3ng&in&product&&&people&development,&and&marke3ng&the&tourism&poten3al&of&an&area&in&ways&that&provides&value&to&visitors,&businesses&and&communi2es.

Value Creation

For businesses

For Visitors

For communities

For destinations

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Truly Customer Centric

(c) Nancy Arsenault (2011). Inspired by Chris Voss (2003)

Continual Innovation & Investment

The Visitor Investment CycleLead with the Visitor not the Function

Change Management

Manage the Visitor Lifecycle

Generate a desire to return or

recommend

Design memorable, engaging

visitor experiences

Value Creation

Research

Increased visitation, spend, length of stay, profit, brand strength

Establish relationships

Know your customer &

markets

Product & People Development

Deliver on the product and

destination experience

Invest in the destination

experience

Promote, advertise, drive sales

Is Tourism at Risk?

Yes

If we don’t

embracethe

opportunityto invest

differently.

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A Tale of Change

Driven by Reality

SynergyLouisbourg

CHOOSING to

Raise the Bar on Valueand

Collaborating to Compete

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1. Know their Visitor

1. Research

• Knowing Louisbourg’s visitor AND Cape Breton’s

• Canadian Tourism Commission

Authentic Experiencer

Cultural Explorer

Cultural History Buff

EngagingLearning

Connecting

Unique Differentiator

2. Invest Strategically

1.Collaboration: Synergy Louisbourg, DCBA, ECBC

2.People: GMIST Experiential Travel Training (Multi Partners)

3.Community: STEP Program (ACOA)

4.Product Development by Businesses:

• Layering engagement• Personalizing the offers• Collaborating to compete as a community

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3. Marketing - broader than just promotions

• Place - Louisbourg, not just the Fortress

• Product - Layer the Community Experiences

• Price - Differentiated options

• People - Build community capacity

• Promotions - Individual, partnered, destination marketing

Growing Steadily

Cannonier for a Day

Playing Hookey

Louisbourg Rocks

etc.

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“It’s kind of exciting . We didn’t realize that people would respond to this so positively and like these intimate ways of experiencing the Fortress rather than just walking around and bumping into costumed stuff and watching a demonstration.”

• Provided focus for reorganizing the time without increasing human resources

• Improved shoulder season experience for guests

•New model for revenue generating programs.

•More choice and opportunities for visitors to experience the site.

Lester MarchandVisitor Experience Manager

Fortress of LouisbourgKey Benefits of Making the Shift

FOCUS ON:

$39.95/pp1/2 hour dressing

2 hours dining

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(c) Tourism Cafe Canada & Earth Rhythms (2014).

Market Price Premium Price

Greater Differentiation,

Emotion, & Engagement

No to Low Differentiation,

Emotion, & Engagement

Land, Building, Tent(Commodities)

Restaurant Dining (Service)

Rooms, RV site(Goods)

Low VolumeHigh Yield

High VolumeLow Yield

Competitive Position

Pricing & ProfitsPoint of View Suites, NS

http://www.louisbourgpointofview.com/ &

Beggars Banquet(Experience)

Aligning with the Primary Demand Generator ... Becoming a Primary Demand Generator

www.thisfish.info

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Page 31: The Visitor Economy:  The Next Frontier

(c) Dr. Nancy Arsenault (2014).

Your Nova Scotia Tourism Strategy

“The creative challenge is to connect emotionally with potential first-time visitors.”

“With government and the tourism industry working together to focus on the visitor, and Nova Scotians as our

ambassadors, we have the elements of tourism

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It Takes Courage

Cuz’ same ol

justisn’t

cutting it

(c) Dr. Nancy Arsenault (2014).

What if to get more visitors and $$

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(c) Dr. Nancy Arsenault (2014).

All of us!

Government + Private Sector + Not-for Profits

(c) Dr. Nancy Arsenault (2014).

Revisit Your Business Model

Business Model Generation

by

Osterwalder & Pigneur

2009

Page 34: The Visitor Economy:  The Next Frontier

(c) Dr. Nancy Arsenault (2014).

What if we challenged how we currently do business

Supply Approach

8 Provincial VICs

Call Centres

57 Regional VICs

Provide Info

Only 20 - 43% stop at a VICStill A lot of people! 360,000 to 774,000 people!

(c) Dr. Nancy Arsenault (2014).

What if we put the Customer First How would it change the conversation about Visitor Servicing?

A Customer Centric Approach

Who is the customer

What type of SERVICES do they need?

Where could they get it?

Enhanced research needed

General Information

Locals Know Insights

Make a Reservation

Website, Print, Facebook, TripAdvisor, YouTube,

Travel Agent ...

VIC, Tourism Business, Gas Station, Kiosk,

Travelling Van, Community

Ambassadors ...

How can we add to the visitor

experience? Physical & Emotional?

Direct, Booking Engine, Bookmark a URL

Washroom, Charging Station,

Print Info ...

What do we stop doing so

we can do new things =

Conversation Spaces!

How will we measure theROI & ROE?

Page 35: The Visitor Economy:  The Next Frontier

(c) Dr. Nancy Arsenault (2014).

Invest in Desired Outcomes Not Just Project

Goal:

New Revenue

Generating Visitor

Experiences Operator A = $10K+ Operator B = $10K+ Operator C = $10K

(c) Dr. Nancy Arsenault (2014).

Shift from Funding to Investing

ROI & ROE

Set NEW metrics of SuccessAmend Program Criteria

Eliminate March Madness

Page 36: The Visitor Economy:  The Next Frontier

(c) Dr. Nancy Arsenault (2014).

Prioritize Infrastructure $

Truly Unique InfrastructureOr Prioritize funding for those those that have:

Infrastructure + Activity + People/Programs

with multiple revenue streams

Direct or PartneredNewark Ohio

(c) Dr. Nancy Arsenault (2014).

Visitor Services to Visitor Concierges

... trained and hired to be an active, sales force

... create info feedback loops WITH industry

... plan itineraries AND direct book with operators

Woodlands Texas

Boise Idaho

Tofino, BC

Page 37: The Visitor Economy:  The Next Frontier

(c) Dr. Nancy Arsenault (2014).

Let Go of Control: Collaboration to Compete

Co-InnovateCo-CreateCo-AuthorCo-Design

Revenue ShareStaff ShareShared Risk

(c) Dr. Nancy Arsenault (2014).

Helping Businesses Use Research

KNOW YOUR VISITORS!

Graphic: tourismcafe.org

Page 38: The Visitor Economy:  The Next Frontier

(c) Dr. Nancy Arsenault (2014).

And Understand ALL Sales Channels

#1: Direct to Consumer (No commissions)

#2: Indirect to Consumer (Commissions or net rates)

Tour Operator (Travel Trade)

Intermediary(Expedia,

booking.com ...)

Customer Bookings

Packaged Independent

Travel Bookings

Group Tour Bookings

Packaging PartnerTravel Agent

Invest in the 7 Ps! They are all Important!

Image: 2.bp.blogspot.com

You can’t drive new business with old products

and services!

Page 39: The Visitor Economy:  The Next Frontier

$2 billion

$$ 3 billion

2 million happy visitors

3 million happy visitors

Nancy ArsenaultManaging Partner & “Experience Gal”

[email protected]: 250.589.2087

Thank-you!

tourismcafe.ca linkedin.com/in/nancyarsenault

twitter.com/NancyArsenault

facebook.com/tourismcafe

slideshare.net/nancyarsenault scribed.com/TourismCafe