Time for a new Tourism Minister
A few months ago the Premier fired his Education Minister, apparently for not making good progress in reforming the education system.
It was a rare example of a Progressive Labour Party Minister being held to account for his performance in office.
Accountability is basic to our system of responsible government. When practiced, it keeps a government honest, on its toes, in touch with the people and doing the job it was elected to do. When it is not, politicians tend to forget they are elected to serve – things don't get done or they get done poorly; sometimes dishonestly.
We believe the Premier should apply the same measure of accountability to himself as Tourism Minister that he applied to his Education Minister and handoff his responsibilities to a new minister.
Here's why:
The numbers don't lie
The Premier has been Tourism Minister since 2004. During these years, with his joint responsibilities as Transport Minister and later Premier, he has exercised total control – some say dictatorial control – over the tourism ministry, whose mandate is to "increase tourism". He has set himself up as the man to take all the accolades – no one is quicker to the microphone – while neatly steering clear of the cameras when the results are poor.
In his time as Minister, Bermuda tourism has continued to flounder – stuck in a multi-year trough of historically poor results. The most recent year, 2008, ranks among the worst since the start of mass tourism in the 1960s, particularly so for hotel-staying leisure air visitors – long the bread and butter of the industry. In 2008, the number of air visitors to the Island was 34 percent below the 1998 result. More pointedly for the Minister, the number of air visitors in 2008 was down nearly 14 percent from 2007. Factor out business travellers and visiting friends and relatives – more than 35 percent of all incoming visitors – and the decline in leisure air arrivals is stunning and, by any measure, unacceptable.
Fewer arrivals means less money earned by the people of Bermuda – less money spent in our shops, hotels, restaurants, taxis and on-island activities. In 2008, visitors spent $111.4 million less than they did in 2007 – a drop of more than 20 percent.
To put these results into even sharper focus, Bermuda's air visitor performance in 2008 finished near the bottom of all 30 Caribbean island destinations.
Our disappearing vacation image
In 2008, a Yankelovich survey found just ten percent of our potential customers across the United States knew of Bermuda as a vacation destination. This compares with the profiles of Jamaica, Bahamas and Barbados in the 50-60 percent range.
This finding is arguably the most damning indictment of the Minister's leadership. Bermuda Tourism's main job is to promote the island to potential vacationers, yet this shocking statistic says that Bermuda's brand awareness has virtually disappeared in our most vital market.
This is not the fault of men and women who toil in the trenches of Bermuda Tourism, but of their minister who has directed the spending of more than $100 million marketing Bermuda over the past five years.
No strategy, bad marketing
One of our chief concerns has been the lack of a clear strategy for Bermuda tourism success. There has been no overriding vision with underlying plans to make it happen. The industry no longer works to a roadmap that coordinates activities and messaging to meet visitor targets in specific markets.
The Minister has spoken about a Platinum Period, but this is an empty slogan that defies clear definition, with no traction in the marketplace. If it is about building new hotels, then the results speak for themselves.
In the absence of a strategy, the Minister has presided over a hodgepodge of marketing ventures that have simply failed to get visitors here. In the process, Bermuda Tourism lost touch with core markets and traditional customers; spread spending too thinly while stepping away from its partnership with the hotel industry that, when working, created joint spending that boosted the island's market profile.
The failure to adhere to basic marketing disciplines indicates that Bermuda Tourism has not been guided by professional expertise.
Two calendar events – the Music Festival and the PGA Grand Slam – illustrate the rise of amateur leadership at Tourism. These have become the Minister's signature events, accounting for 20 percent of his Ministry's total budget. Yet last year they attracted less than 3,500 visitors. The Minister is quick to say that they generate "millions" in collateral advertising but there is no getting away from the fact that these events have failed to put "heads into beds".
The gap between the amount of money Bermuda spends to attract visitors and the numbers that actually end up in our hotel beds – our return on investment – has widened dramatically under this minister. It must be closed. The dabbling must end. Professional leadership is needed.
Sales disarray
The Minister has continued Bermuda's Tourism's physical retreat from key North American markets through the closure of sales offices – an initiative we disagree with because of the need for human connections in the business, particularly with travel agents. The retreat reached its nadir last year when the Minister shut down the New York tourism office – throwing Bermudians out of work – in favour of an American sales company that he recently decided was not up to the job.
The Minister's destruction of the New York office did not have to happen. The Minister justified the closure because "the sales model for Bermuda Tourism was outdated". But we believe that any improvement in the performance of the office, whether through the adoption of a new sales model or the replacement of underperforming staff, was a straightforward management challenge; something to be solved by hands-on professional leadership. That the Minister chucked the whole operation and its people for an unproven and, ultimately, ineffective American sales force represents the dangers of unchecked one-man rule.
The upshot is that Bermuda Tourism's marketing organisation is in a shambles; with the Minister supervising the meltdown of our North American operations. In the midst of a worldwide economic crisis, when Bermuda needs its strongest sales effort against intense competition, we are without a dedicated sales force in our most important market. It is unacceptable. We are, however, encouraged by the appointment of a director of global marketing who may be able to bring professional leadership to the situation.
Cruise ship failure
For the first time since the start of the modern cruise ship era, Hamilton does not have a dedicated ship, leaving retailers with fewer customers at a time when they need all the support they can get. The Minister's spokesmen have said this was done by plan; part of the industry shift to mega ships that left no callers for Bermuda. When businesses protested, the Minister landed a dedicated ship for Hamilton in 2010. With a determined effort, Hamilton could have had a dedicated ship this year. Whether he was disconnected or indifferent, the Minister could have done better.
Operational paralysis
The Minister has failed over the past year to adjust to market conditions. Prior to the 2008 summer, following a severe springtime drop in arrivals, the Minister ignored our calls for emergency spending to boost arrivals from core markets. That was a mistake.
This winter, in the face of an even more difficult market, his Ministry did not initiate any special promotions. The failure to respond may have been due to the upheavals the Minister created in our North American sales operations, but they also speak to a failure to appreciate what needs to be done to generate business in the midst of recession. Our competitors to the south apparently did with Jamaica, Barbados and Bahamas voting extra money to promote their destinations.
We need a minister in place who is focused solely on the business of selling Bermuda, who has the presence to work the market and react to its vagaries. The past year has shown that we don't have that.
If our tourism industry is to have a chance at new life, we need a new direction, and fresh energy. It is time for someone new, someone with the time, the enthusiasm and the ability to bring together people to do what needs to be done to get the industry back on its feet.
Here are some recommendations to help the new minister:
¦ "Fish where the fish are." Develop a marketing plan that brings the focus back to our traditional markets and invests in promotions targeting demographic groups least affected by the recession.
n Restore Bermuda's brand awareness. If the money can't be found in the current budget, we would support a supplementary spending bill.
¦ Help our beleaguered hotels. They need it. Grant them and their employees payroll tax relief. Eliminate the hotel occupancy tax to reduce the cost of a Bermuda vacation.
¦ Stop the spin. Be straight with the people. Repeated claims of tourism success have undermined the collective understanding Bermuda needs to make the right decisions for a better tourism product.
¦ Launch a fully funded on-island tourism appreciation programme that restores the value of tourism in the hearts and minds of our people.
¦ Start the transition to a Tourism Authority. We need to get the management of tourism into the hands of hospitality professionals and out of the hands of politicians. The authority's primary goal will be to make Bermuda competitive again as a tourism destination.