Investing emotionally in the age of travelby Stuart Pallister, EHL Hospitality Insights
Tourism is set to grow exponentially, with some 1.8 billion people expected to travel by 2030. Last year that figure was 1.18 billion and nowadays some eight million people fly each day. The United Nations has already declared 2017 the international year of sustainable tourism for development. So what does that all mean for the industry?
In an at times emotional presentation to EHL students in the Distinguished Speaker Series, Anita Mendiratta, the Managing Director of Cachet Consulting and special advisor to the UN’s World Tourism Organization (UNWTO), spoke about her experiences in places as far flung as Rwanda (to view gorillas close-up), Tacloban in the Philippines (to witness for herself the destruction caused by the super-typhoon), and Cuba (for a regional UNWTO meeting as the first U.S cruise ships arrived after the travel ban and embargo were lifted).
Citing the Secretary-General of UNWTO, she says this is the age of travel: “We’ve moved past the industrial revolution to the electronic and digital revolution. Now we’re in the travel revolution. It’s staggering. It’s because of travel and tourism that the world is losing its boundaries. People are caring more, and more often, about people they didn’t even know before. People want to see what’s happening in the world. They want to understand it and they want to understand the implications.”
Although the world is a ‘scarier’ place’ due to media coverage of wars, political upheaval, viruses and natural disasters, “it’s our industry that has really made the human connection the finest that it has ever been in the world.”
“People are not just travelling for the sake of going from A to B,” she says, “they’re travelling for understanding, opportunity and worth.”
“What I love about this industry though, the beauty of travel and tourism is actually not about the tourists. The tourist is the catalyst, the vehicle. But the magic of why this industry matters is actually not about the tourists … It’s about the ripple effect. The impact the industry has in terms of truly building nations.”
Tourism creates jobs and livelihoods, she says, giving the example of the number of people in the supply chain needed just to get a simple egg from the farm to the hotel breakfast table.
“That’s what this industry is all about. It is the third biggest economic sector in the world behind automotive and banking. Importantly it’s the only economic sector in the world that did not receive a bailout when the downturn happened.”
Some 280 million people are employed in the tourism and travel industry. “Our industry allows one in 11 people to go to bed and know that tomorrow’s going to be a good day. It’s responsible for 10% of global GDP, 9% of global investments; and the great thing about investments, whether it’s mega events, structures, infrastructure for roads and airports, it’s the locals who get to keep the infrastructure once all the tourists have gone so it’s the citizens that are able to benefit.”
“Our industry that you are all part of, has become part of the solution to some of the most profound problems that we have ever seen.”
The Cubans “were pariahs. Suddenly Cuba is the hottest ticket for Americans wanting to travel … For 40 years the world didn’t care and suddenly the Cubans felt their worth. That’s amazing.”
Tourism globally is expected to grow by around four percent. For individual countries the numbers are staggering. Some 102 million Chinese tourists travelled internationally last year (37% growth year-on-year), Russian tourist numbers were up 37.5% but that growth is pulling back because of the economy.
“It’s not the number of tourists, it’s the value that they bring - how much they inject into the economy. China itself was at $137 billion in terms of value and is going to increase in 10 years to quarter of a trillion. That’s 86% growth in 10 years.”
Tourism can have its downsides, as in the numbers of tourists flocking to Bali or the cultural insensitivity shown by some travellers in sacred places such as Angkor Wat in Cambodia, Mendiratta says. But on the whole tourism brings major benefits.
“It’s our industry that allows people to be true to who they are ... The future opportunity is recognising that the growth of our industry, whatever part we’re in, is about staying truly connected to what matters … It’s because of what they can get in their hearts by staying connected to what matters to them, whether it’s someone, somewhere, something.”
“The emotional investment in travel far exceeds the financial investment and the day we forget that is the day we must leave our jobs … It is absolutely the time to make the most of the world - for so many reasons, because ultimately what brings people back to hotels, restaurants, countries, is loyalty.”
“What’s loyalty all about? It’s the simple premise of I’ve seen you and I know what matters, whether it’s 1.18 billion people travelling or just one.”
Anita Mendiratta is the Founder and Managing Director of Cachet Consulting and Special Advisor to the Secretary-General of the UNWTO. In addition, she is also a Strategic Advisor to CNN International on tourism and economic development. She spoke at EHL on October 19, 2016 in the school’s Distinguished Speaker Series (DSS).
Stuart Pallister is Associate Director of the Lausanne Hospitality Research Center and editor-in-chief of EHL Hospitality Insights.