Approach tourism from an entrepreneurial perspective: Suman Billa
BW HOTELIER got in touch with Suman Billa, Director, United Nations World Tourism Organisation (UNWTO), Madrid to pick his brain on the ultimate gameplan to revive the worst affected sectors due to the pandemic.
At UNWTO, you have a larger world view and global play to witness firsthand in this space, do share with us your experiences that would be good for us all in India to internalise and put to best use?
Tourism sector the World over is in turmoil because of the COVID-19 pandemic and experience has been varied depending upon the severity of infection, size and nature of the tourism industry, reliance on overseas markets etc., but we can safely say that all the countries and destinations have been affected severely. We can also deduce that the world and especially the tourism sector would be very different from the one that we knew before the pandemic. The sector would fundamentally reinvent itself with focus on creating meaningful and authentic experiences with a renewed focus on sustainability and responsibility. It provides an opportunity for us to hit the reset button and the markets would reward those who are fast off the starting blocks.
Given the unprecedented times, in what ways has the pandemic changed the travel, tourism and hospitality industry? How do you see the sector evolving moving forward?
In the immediate sense, the pandemic has caused unprecedented devastation to the industry. UNWTO has stated that 2020 has been the worst year in the history of tourism with International Tourist Arrivals dropping by a record 74 per cent resulting in a drop in International Tourist Arrivals by 1 billion, reduction in Tourism Export Revenues to the tune of USD 1.3 trillion and loss of Direct Jobs in the sector estimated to be between a 100 to 120 million globally. But beyond the immediate concern of survival, we should also be cognizant of the fact that tourism in the post pandemic era would be fundamentally different as consumer preferences the world over are seeing an accelerated change. We are likely to see a pronounced shift away from mass tourism towards more meaningful and authentic travel giving rise to new product offerings. Also, the accelerated shift towards zero carbon destinations, zero food miles, factoring environmental costs beyond economic costs would redefine the industry. It is time for businesses to reinvent themselves to stay relevant.
The travel & tourism and hospitality industry has been the hardest hit sector due to the on-going crisis. Now with vaccination drive in process, how do you think the industry is going to kick start to regain lost ground and be counted as one of the biggest contributor to our GDP while providing a truly global experience?
Vaccine passports could well be the silver bullet that could restart international travel, but there are some elements that are yet to be clarified before we can assume it to be so. At this point of time we are not yet clear about the duration for which the vaccines would be effective, whether those vaccinated could be potential carriers even if they do not fall sick and there is the complication of different vaccine candidates having a differential rate of success. There is also the moral and ethical prospect of the vaccine haves and the have nots which is being discussed animatedly. The vaccination programme itself is running a little behind schedule on account of difficulties in ramping up production globally. The prospects of International Tourist Arrivals would largely be dependent upon these outcomes.
What, in your considered view, should be the ultimate game-plan to revive the worst affected segments (travel, tourism and hospitality) in India?
As the pandemic lasts longer than expected several governments are eager to see the light at the end of the tunnel before they commit large outlays for the revival of the sector. This has also meant that several businesses have been forced out of business in the interim. Essentially, the support from the Governments could be spread across interventions like enhanced credit access at favourable terms, tax instrumentalities to ease the cost of doing business as well as to kick start demand and aggressive campaigns to reclaim the market. In India, we have the advantage of having a large domestic market. We receive 11 million international tourists but send out 25 million outbound tourists who cumulatively spend USD 26 billion a year. If we are able to tap into this purchasing power, we should be able to reasonably negotiate the challenge. Apart from the LTC incentive which the Government has announced to kick start demand, we also need to look at tax incentives to retain the spending power within the country. After all, in this case every dollar saved is a dollar earned. To facilitate the revival of domestic demand, we should have a harmonised set of health protocols across the states to yield to predictable planning. States should prepare the destinations to receive tourists by ensuring safety protocols. Tourism businesses should put on their thinking cap and reinvent their business with a laser sharp focus on what makes commercial sense in the changing circumstances. For example, most of the tourists now come from a younger demography and therefore products need to be created or repackaged to make it attractive for this age group.
During these unprecedented times, how do you propose all stakeholders (private and public) should prepare the roadmap for the industry’s recovery?
There has never been a more compelling time than the present to warrant a strong Public – Private partnership. As both the Governments and the Industry are severely challenged for resources, it is essential that they come together and work to optimise the spend of the limited amount of money. The Government and Industry should work together to develop harmonised health protocols across states and put in place robust safety protocols across all key destinations to reassure travellers. As the domestic market opens up, State Governments should actively work with their industry to undertake compelling campaigns and marketing activities in order to attract tourists to their states.
As many as 11 million foreign tourists visit India annually and with the slow restart of international travel, what are your suggestions for the aviation sector to create consumer confidence for safe travel, especially when all countries are putting their best efforts?
Aviation as a sector has been as badly affected as Tourism. If Tourism has to move beyond the immediate comfort zone of driving holidays, it would need to rely upon aviation to move the critical mass of people within a safe and controlled environment. On the other hand since business travel is depleted, the Airlines also need to shore up demand through leisure travel. Mutual consultation on emerging demand and bundling together the cost of aviation and hospitality to remove the uncertainty of the final cost to the consumer would serve both the sectors extremely well.
The infrastructure in India has developed drastically in the past two decades. Do you agree that the country is now moving towards a futuristic vision? Your suggestions and views.
Tourism rides on the existing infrastructure and is its primary enabler. India has built up some very impressive infrastructure over the past two decades and the pace has picked up considerably over the past few years. We have best in class assets like airports and metro rails and our National Highways are enabling the ease of travel. The focus on Smart Cities would help open the market for the $100 a night budget international travellers whose numbers are predominant. When such travellers travel to a destination, they prefer to use public transportation like metro trains, buses, cabs etc much like the local population. We need to be able to make land available for the 3- and 4-star hotels in key destinations through a conscious policy in the land use plans. High speed train connections would also enhance the India offering considerably. We need to give a big push to our water transportation and enable sea plane services wherever feasible.
MICE tourism is one of the huge revenue driver and has been on a long halt from past year. When do you expect the true revival of the MICE industry?
MICE has been the worst affected along with cruises amongst the asset classes within the tourism space and it appears that its revival will trail that of the other asset classes. We are also likely to see the phenomenon of hybrid conventions continue firmly in to the future which means that future conventions are likely to be smaller than they were before. But most of the MICE infrastructure in India is in the medium to small category and they would be able to host some of the big conventions in their hybrid avatar. We can turn this to our advantage. We also need to reinvent our approach towards MICE activities to take full advantage of technology, utilising open areas more effectively and designing protocols for staggered entry and exit to ensure a safe and orderly conduct of the proceedings.
Having been confined to their homes for the past few months, the travellers are keen on moving out. How do you propose one should promote their inherent culture keeping the new norms in mind?
It is true that people are chafing at the bit to travel once the restrictions are lifted what is now termed as revenge tourism. We also tend to overestimate the potential of revenge tourism. Most people would be wary of travelling out of their comfort zones and only the determined tourists are likely to step out until the virus containment becomes a reality. In the interim Governments would do well to ensure safe and predictable travel between states, the governments and the industry should come together to ensure that there are robust safety and hygiene protocols in place to reassure the traveller and most importantly the industry should earn the trust and confidence of the traveller through fair trade practices like allowing for postponements and cancellations without punitive costs.
Talking beyond the hard-points of this pandemic, what learnings and opportunities would you list for our readers to sail out of the current crisis?
We all know that eventually, we would overcome the pandemic, in the interim it is essential for businesses to hunker down, cut costs, reinvent their product offering and more importantly retain the trust of the consumers. For employees, the focus is going to be about multi-tasking, skill upgradation and more importantly to have a can do attitude to stay relevant. For the Governments, the game is about creating the right conditions for their tourism businesses to thrive.
Anything you would want to share with your readers which we have not covered, and which would be of interest for the fraternity and outside to read, know and take home as a best practice from a learning standpoint.
The Post Corona world would be vastly different from the one before and it would change the sector fundamentally. Technological change has accelerated to warp speed and we need to be ready to adapt it. Governments need to approach the Tourism Sector from an entrepreneurial perspective and the successful ones are going to be marked by bold, nimble and business first leadership. Tourism business would be required to reimagine the product offering from a fresh perspective. This would disrupt the old order and open up an array of exciting opportunities for innovative disruptors. Lastly, this gives us an opportunity to get the tourism sector on a sustainable footing by ensuring that we are environmentally, economically and socially responsible and place the benefits to the local communities at the front and centre of all our endeavours.
This article was published in BW hotelier issue dated '' with cover story titled '6TH ANNIVERSARY SPECIAL ISSUE VOL 7, ISSUE 1'
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