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The panel discussion held by the ESADE Alumni Tourism Management Club about the challenges facing the tourism industry, a key sector in Spain’s economy, addressed subjects including online agencies, big data, new types of tourist accommodation and business travel.
In the last year, Spain has notched up record-breaking numbers of visitors and hotel occupancy. Some of the data presented by Mónica Muñoz left no doubt: ''Tourism is one of the most important industries in Spain and according to the latest INE data, from 2015, it accounts for 11.1% of Spain’s GDP and almost two and a half million jobs. In recent years, it has grown more than the economy as a whole.''
The discussion was chaired by Juli Burriel, the director of Travel Manager journal, director of the Iberian Business Travel Association and general secretary of Spain’s AEGFA (association of car fleet managers).
The panel members alongside Burriel were Luis Javier Gadea, manager at SEGITTUR (Spain’s tourism innovation and technology association); Carlos Ortiz, co-founder and CEO of Worktel, a platform offering managers and freelancers places to work in hotels, and a board member of several start-ups; Hugo Rovira, general manager in Spain and Portugal of the NH Hotel Group and vice-president of the Madrid Tourist Association; and Jennifer Zhang, managing director of Ctrip Spain, CEO of AsialinkSpain and president of China Club Spain.
On-line travel agents
The discussion began by considering on-line travel agents (OTAs). Jennifer Zhang talked about Ctrip, the biggest OTA in China and the second largest in the world, which is currently immersed in global expansion and has already garnered almost 300 million registered customers. Zhang described how Chinese tourism has changed in the last ten years from being tightly controlled and difficult to obtain a visa, to a free and fully digitised market. ''In China, all services are paid for by NFC mobile payments. This is a revolution, and any markets that want to attract Chinese tourists must accept mobile payments.''
Hugo Rovira says that OTAs are unstoppable and have responded to customer needs: ''OTAs are global and offer content that others do not. They are great for some services, but not for others. Depending on the level of complexity and relevance of what we are looking for, we might need advice or something very specialized, in which case, OTAs are not ideal.''
Carlos Ortiz believes that OTAs and tour operators are all important. Users have different profiles depending on what they want to do, for example, whether they are business travellers or taking a family holiday. ''So you need them all. I think there is room for them all, it’s a matter of considering how to make them most of them,'' he said.
''The tendency is to look for cheap solutions. If I use an OTA it’s because it’s cheaper.'' Luis Javier Gadea had no doubt that the major trend is the success of low cost – not only in tourism.
Social media and big data
An important aspect of OTAs is that internet browsing and social media activities create data that make it possible to identify customer profiles and create a whole system of recommendations, i.e. personalized marketing. Jennifer Zhang emphasised how important big data are for knowing travellers, whilst Hugo Rovira mentioned how useful they are for improving the customer experience and providing highly personalised services that ensure the best possible stay.
Luis Javier Gadea outlined the example of destination analysis and recognition systems. Social media make it possible to gather all sorts of information about each destination. OTAs, for example, reveal what users think about a hotel, its cleanliness and services, etc., and all the information gathered is used to create predictive models.
Another subject aired in the discussion was the sharing economy and platforms like Airbnb offering accommodation and Cabify for passenger transport. Rovira said that companies such as Airbnb don’t share anything and are simply big business. ''Free competition is great but it must be legal, the law and its requirements must be the same.'' Luis Javier Gadea agreed that the law cannot prohibit what consumers want, but that the same rules must apply to the competition.
Carlos Ortiz also believes that these platforms are unstoppable and will continue to grow because ''they offer customers something they did not have before and customers are in charge.''
During the discussion, the panel members differentiated between two types of business travel: individual business trips versus conventions and corporate events. Zhang explained that Ctrip provides services of this type for companies because it is not only an OTA but also a tourism group with a high-street agency that offers advice. ''For individual trips, Ctrip has an app available to anyone in a company who needs to organize business trips.''
Hugo Rovira mentioned that large companies do not use OTAs for their business trips but SMEs do, and in Spain SMEs account for more than 90% of all businesses. He also commented that OTAs have very good strategies and personalized services that work very well.
One of issues of most concern that emerged during Q&A was the tourist phobia happening in some cities due to the impact of mass tourism on their residents. Both Gadea and Rovira stressed the need to consider what sort of tourism and cities are wanted, remembering that Spain is a foremost tourist destination.
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