Wildlife at Yala has got a new birth due to the low traffic post-21 April
Whilst many are looking at the downturn in Sri Lanka tourism, in my view, we have got a third chance to make Sri Lanka Tourism a world-beater in the future. We can use the next year to re-position the brand, just like Bhutan and Rwanda Tourism, did to attract a more exclusive segment of customers. It worked for both countries, and we can do the same with some smart thinking, given the low equity of the country among potential travellers in the global market place.
First chance: 2009
If I track back, in 2009 we got the first chance after the cessation of hostilities with the LTTE. A fully-fledged advertising tender was rolled out, with professionals like us in the technical committee. After a rigorous process that lasted almost a year, we selected a global advertising agency, and for each market a specialised PR agency, that included a research agency to support the decision making. The process was headed by one of the top professionals in the industry, Dileep Mudadeniya. But alas, on the day of the launch, ‘Sri Lanka - the Small Miracle’, it was cancelled while the guests was gathered at the BMICH awaiting the arrival of the Chief Guest. The logic being, ‘Sri Lanka has beaten the LTTE and it is not a small miracle but a BIG miracle’. A very sad day for Sri Lanka Tourism, given that the whole process was managed very professionally, and decisions taken on merit with strong research backing.
Second chance: 2015
Then came the second chance in 2015, when the Yahapalanaya Government came, where we all believed that the hierarchy was professional in nature, and people like us decided to take responsibility to lead such key institutions like tourism. Just like a private sector entity, a professional, above-board, technical committee was appointed, consisting of eminent independent individuals like the President of the Sri Lanka Institute of Marketing, Chairman of the Export Development Board, Additional Secretary of the Ministry of Defence (who had worked in the Foreign Service for 20 years), the Additional Secretary of the Ministry of Tourism, the Marketing Director of the Tea Board, and a top procurement expert from the Government, whilst the Chairman of the entity was a marketer by profession.
To bring in absolute professionalism, the first tender floated was a ‘creative pitch’, so that with limited funds we could get the best from advertising agencies to develop a strong ‘positioning campaign’. The top seven global advertising agencies were shortlisted to submit proposals with a clear brief, which was done in just 3 months, with the team working past midnight, given the urgency of the campaign.
A month before proposals were submitted, the Board was dissolved in October 2015, whilst the tender was cancelled two days before the submission date of the proposals. All seven ad agencies were up in arms, as each of them may had spent Rs. 10-15 million with work done on strategy and creative. Even as we speak today, after four years there, the $4 billion generating private sector sees no progress.
Third chance - today?
If one takes an optimistic view, post the 21 April Easter attacks, Sri Lanka Tourism has got the third chance, to my view. We can use the downtime of the industry to put the house in order. Appoint a PR agency (not just a blanket agency, but a specialised localised agency for the markets of India, China, UK, Germany, France, Italy, and Russia). We must also have a dedicated global advertising agency for positioning the country in the changing global landscape of this $1.3 trillion business. This must be done via the tender process, like what we did in 2008, and not a single source basis approved from Cabinet. The hotels that need refurbishment can use this time to do the same, whilst we correct the issues related to the stipulations of tour guides and the processes in visiting key sites like Sigiriya and Yala on the theory ‘carrying capacity’.
By the way a point to note is that “over-tourism” is a theme that the World Tourism Organization (WTO) is focusing on this year, which means the science of carrying capacity, which includes supply chain development, can be studied and best practices adopted by Sri Lanka.
But sadly we see that the third chance is also slipping by, as now Sri Lanka has been challenged with a communal issue rather than focusing on tourism development.
SL Q2: recession?
It is said that for every tourist that visits a country, four people get employment in the value chain of tourism. Which is why it is said that in developed markets, one in every eleven people are employed in the tourism sector. Post the recent Easter Sunday attacks, what we see in Sri Lanka is the total economy collapsing, from tour guides to tourist vehicle owners, to people who are in the business of supplying food, vegetables, and meat products, almost on the verge of bankruptcy. Many hotels have closed down in different parts of the country.
Then we have also seen the laying-off of staff by tourist establishments, just to manage the costs. A point to note is that the industry was struggling financially, based on calculations like ROI, even before the Easter Sunday attacks. The latest calculations reported are that the impact will cost the country around $1.5 billion.
Post the development of the communal angle to the current issue, we see the total retail trade is affected, that will result in a contribution of almost 35% to the GDP taking a hit. Some speculate that the Q2-2019, will see the country moving to a recession with GDP at -1% to zero performance. Sadly the hierarchy is more interested of staying in power than giving economic leadership.
Global experience: terror attacks
If we do a deep dive on the terror attacks lately around the world, such as the attacks in Brussels and Paris, we saw many British tourists injured. The shooting down of a Russian airliner in Sharm-el-Sheikh sure shocked the world. But the attack on Sri Lanka on 21 April shook the world.
If we take the global pick-up from similar incidents around the world, France suffered a 10% fall, Kenya 25%, while Turkey faced a drop of almost 50%. Brussels are grappling to recover which created huge stress on local jobs but now after an 8-10 months window, we see all the above economies turning around. It is estimated the same time will be taken in Sri Lanka, but the issue is that the weak leadership in the Government is making the country lose faith on the policymakers.
We must not forget that over 200 million people globally rely on tourism – one in 11 global jobs, as mentioned before. The importance of protecting the sector from external shocks, especially in more fragile developing economies, is very important, but we see that politics is taking over disasters rather than the economic reality. Which is sad.
Maldives: an example to us
In this background, the Maldives Government is strategically looking at the bigger picture in its tourism agenda, though the industry is challenged with a similar situation, due to the ISIS threat-related implication on tourism arrivals.
The policymakers in Maldives are focusing on the opportunities in education, health, gender parity, and environmental protection, which all feeds into a robust and resilient tourist sector. The country is increasing its appetite for younger middle income Maldivians to launch their own entrepreneurial projects in the tourism industry, on the ethos of the shared economy. Jobs are blossoming out in the fields of infrastructure, health tourism, and technology, which is an interesting insight for an island nation.
I yet remember during my UN days, whenever we met the Maldives public sector, they would be proud about the nation been the best MDG+ country in South Asia. Literacy rate at 98% and extreme poverty being non-existent in the Maldives has resulted in a vibrant tourism sector – with improved offerings and a better-educated, diverse, and engaged workforce, which ideally fits the strategic development of the industry, which is a fact. Let me do a deep dive to their strategic direction that Maldives is taking, and Sri Lanka can also pursue a similar direction. I am calling this the third chance.
The competitor landscape is very similar to Sri Lanka. Mauritius, Bahamas, Dominican Republic, Sri Lanka, Seychelles and Madagascar to be specific.
Maldives Tourism invests heavily in research for decision making – a point that Sri Lanka can learn. For instance, the reason for visiting Maldives, based on the research, is rest and relaxation - mentioned by 63%, whilst the internet is the most important source of information to discover the Maldives. To be exact, the pre-arrival behaviours are 26% via internet, 22% through word-of-mouth, and 14% through travel agents move through the purchasing process.
Incidentally, one out of ten international visitors to the Maldives use ‘Visit Maldives’ as their travel guide to Maldives, which tells us the power of a strong cutting edge-communication campaign while Sri Lanka is yet trying to get its act together. A point to note is that without a strong ‘creative’, it is foolish to build a tourism story, which what experts say. The Maldivian Tourism Campaign ‘Sunny Side of Life’ beautifully captures the essence of the brand. Maybe it’s a point to deliberate.
Maldives Tourism master plans: four in 35 years
This is the key pickup that Sri Lanka policymakers need to think about. Maldives has had only four tourism master plans in a 35-year time span. If I may track back, the first was in 1982, the second tourism master plan was in 1995, the third was in 2007 and the fourth tourism master plan, which came to the market in 2013, is said to hold ground up to 2017.
To me, what this implies is that the best brains get together and develop a plan, and then the policymakers make space for it to be rolled out to the market. The other day, when I met the Maldives Tourism marketing team, what they shared was that many adjustments had to be made to the plans on the run, but strictly speaking, the strategy was allowed kick in for a minimum of six to eight years so that the results can be analysed, before it was once again taken back to the drawing boards. This is where Sri Lanka differs. I know for a fact the tea industry of Sri Lanka has had as many as 69 reports and plans by different stakeholders, and none have been implemented.
Maldives Tourism: focused vision
If one digs deeper, the strategic direction of Maldives Tourism what we see is that it is driven on an architecture that strictly ensures brand consistency, in contrast to the runaway informal sector that accounts for 60% of Sri Lanka tourism revenue, which is not even registered in the relevant Government authority.
Maldives Tourism is very clear that they want to be the best tropical island destination in the world, the most exclusive destination in South Asia, the top tourism earner in South Asia, and be an example of sustainable tourism development in small island nations.
In contrast, in Sri Lanka, if we examine the new properties coming up in Sri Lanka, over three-quarters happen to be in the three-star category, which inevitably tells us the type of tourists that will visit Sri Lanka in the next couple of years. The question is, given the limited resources we have, and the carrying capacity that the island holds, is it the three-star visitor that Sri Lanka must give space for?
Maldives: cutting edge objectives
In the case of Maldives, what we see is that a ruthless decision has been taken to enhance the exclusive image of the destination in the source markets, and position Maldives as a ‘premium’ destination worldwide, and based on the strategic positioning, the authority will ensure the new products maintain this architecture, so that sustainability of the marketing campaign is insured. This, to my mind, is the brilliance of the marketing strategy of Tourism Maldives, which Sri Lanka needs to take a lead from.
Implications to Sri Lanka
I guess we need to just go back to practicing the basics; just like my guru the late Prof Uditha Liyanage once said, ‘be brilliant in the basics’. This is exactly what Maldives is doing in driving the tourism sector. Segment, target, position. Thereafter, derive the marketing objectives and key actions, that must be scaled down to a powerful creative, that then can be hosted on traditional media or emerging media like digital platforms. Sri Lanka has got the third chance. Will we blow this opportunity too, is the million dollar question.
(Dr. Athukorala in an alumni of Harvard Executive Education and accounts for over 20 years’ experience in top Multinationals that include the UN and heading 3 key industries in the public sector like Tourism and Exports
can be contacted on firstname.lastname@example.org)