Tourism 2012 Consultation Project Team

Tourism Division

6th Floor

Department for Culture, Media and Sport

2-4 Cockspur Street

London SW1Y 5DH

17 November 2006

WELCOME>LEGACY CONSULTATION

Tourism Alliance Submission

Executive Summary

The 2012 Olympic Games represent a major opportunity to showcase Britain to the world. Success could generate a step-change in inbound tourism and a renaissance in domestic tourism.

To maximise the benefits of the Games requires Government to set a clear framework in which the tourism bodies and the tourism industry can develop and implement a coherent and well-resourced marketing, media and communications strategy. It is essential that:

  1. DCMS takes ownership of the strategy and its delivery against the target of £1.6bn in additional tourism expenditure over the period of the strategy.
  2. A Joint Olympics Tourism Co-ordination Unit is established to plan and deliver the marketing and communications strategy.
  3. An Advisory Council be established to provide regional and industry input into the Joint Unit’s activities.
  4. An Olympics Tourism Forum be established with members drawn from a wide range of tourism interests to co-ordinate activities and provide consistent and coherent marketing and communications across the wider tourism industry.
  5. Government provides adequate funding for the marketing and communications strategy via a public-private partnership.
  6. Core components of the marketing and communications strategy are to:
  1. Build inbound business and leisure tourism in the lead-up to and after the 2012 Olympics
  2. Sustain “normal” inbound and domestic tourism during 2012
  3. Use the Olympics to enhance London’s role as a gateway to the UK
  4. Maximise the opportunity for world-wide media coverage of Britain afforded by the 20,000 journalists expected to attend the Olympics
  5. Develop contingency and crisis plans in case of adverse events during the Olympics.
  1. Tourism statistics are improved so that challenging, yet realistic, quantitative and qualitative targets can be set and monitored in the lead-up to, during and after the Olympics.
  2. DCMS is focused on being the champion for tourism across Whitehall, enabling the tourism sector to concentrate on delivering high quality products and service to customers.
  3. Planning of the strategy commences immediately and implementation is a matter of great urgency if we are to achieve success.
  4. National tourism strategies and policies for the UK include the Olympics, but are not entirely subsumed by this single event.

1.Introduction

The Tourism Alliance was established in 2001 with the support of the Secretary of State for Culture, Media and Sport as the voice of the UK tourism industry and now comprises almost 50 Tourism Industry Associations that together represent almost 200,000 business of all sizes throughout the UK (See Appendix 1 for a full list of member organisations). The Tourism Alliance’s mandate is to work with Government on issues relevant to the growth and development of tourism and its contribution to the economy and it is therefore responding to this consultation in that capacity.

The Tourism Alliance was very supportive of the London 2012 bid, continues to be supportive of the staging of the Olympic Games (references in this document to the Olympic Games refer to both the Olympic and the Paralympic Games) and believes that the potential benefits that hosting the Games will have for the London and UK economy are considerable, especially for tourism.

As part of its support for the Games, the Alliance is a signatory to the tourism 2012 charter which aims to ensure that visitors to the Games, both overseas and domestic, receive a high quality experience.

The Alliance is committed to help making the 2012 Olympic and Paralympic Games a success both in terms of a large-scale one-off event and also as a means of providing a step-change in both inbound and domestic tourism. The opportunity for London and the UK to be showcased to a potential global audience of around 4bn people is truly a “once in a lifetime” opportunity and, as such, a focused, well-resourced tourism strategy that informs, inspires and pulls together industry and Government initiatives, is central to maximising the tourism benefit to the country.

While one of the Government’s major motivations for staging the Olympic Games is clearly the ability to undertake large-scale regeneration of one of the most deprived areas in London, it is clear that the regeneration benefits alone will not compensation for the £5bn cost. It is through the opportunity to generate additional tourism where there is the greatest possibility of recouping the funds expended on hosting the Games. Therefore, this is where the Government needs to focus its energy and resources in order to maximise the return to the country.

2.Context

While the Tourism Alliance is fully committed to making the 2012 Olympics a success and believes that it provides an unprecedented opportunity to improve the UK’s standing in the international tourism market, it should be noted that Olympics-related tourism numbers will be low in comparison with the number of people who already travel to London and the UK.

Although no official figures exist, we estimate that the total number of inbound tourists who will visit the UK in relation to the Olympic and Paralympic Games in 2012 (including competitors, officials, media and spectators) could be up to 300,000 (three times the number of people who visited the 2000 Olympics in Sydney). There will, of course, be a considerable number of domestic tourists as it is anticipated that around 90% of all tickets will be sold to UK residents. However, the actual number of domestic visitor and their length of stay profiles are not known.

It is also worth noting that London is a large city and a global tourism destination with a large tourism capacity. The resident population is about twice that of Sydney and ten times that of Athens and, on normal day at the time of year when the Games will be held, there would be 425,000 overseas tourists in London anyway. LOCOG and TfL have estimated that the maximum daytime traveller requirements during the Games will fall well within normal daily operating capacities, especially as the Games will be held during a school holiday period.

Nevertheless, at 300,000 visitors, the number of overseas tourists who may visit London for the Olympics represents just over 2% of the total number of overseas tourists who currently visit London each year and just 1% of the 30m who currently visit the UK. In fact, if UK inbound tourism grows at the world average of 4% between now and 2012, the 300,000 visitors will represent just 1.6% of all visitors to London and 0.8% of all visitors to the UK.

Most of these visitors will simply substitute for “normal” leisure and business tourism and will not be additional to it. The experience of previous Games is that many potential leisure and business visitors will perceive that London and the UK will be “overrun” with Olympic-related visitors in 2012 and will choose to visit another destination that year. Indeed, even domestic Olympics-related tourism is likely to be displacement from normal domestic tourism, rather than additional as, at the time of the Games, regular leisure visitors are deterred and many residents choose to go away.

If only 5% of “normal” visitors were to stay away in 2012, overall tourism expenditure in London and the UK would fall by, respectively, £300m and £800m (in 2005 terms). In addition, if a further 5% of UK domestic visitors decided to avoid a holiday in the UK that year, this would reduce tourism expenditure by a further £1.35bn (again in 2005 terms).

This means that, in addition to considering how the nations and regions of the UK can derive lasting benefit from staging the Games, the strategy should give consideration to ways of ensuring that, during 2012, the Olympics do not impact negatively upon “normal” tourism. Britain should be the first Olympic host to comprehensively plan to mitigate the potential undesirable effects on regular tourism.

Also, as Olympic-related tourism will be quite low, the main emphasis of the strategy should be on maximising Olympics-motivated tourism.

3.The Core Components of the Welcome>Legacy Strategy

The key aim of the Welcome>Legacy strategy must be to maximise the potential tourism benefits of hosting the 2012 Olympic Games. This involves many aspects that are not addressed by the questions posed in the consultation document. Therefore, we are responding to the invitation to highlight what we believe to be the core components of a successful strategy and have answered the consultation document questions in Appendix 2.

The Tourism Alliance believes that the resultant strategy should comprise two separate, though interrelated, components. These are;

  1. Olympics-Specific Tourism Arrangements
  2. Building a World Class Tourism Industry

For the strategy to maximise the benefits associated with the Games, it should predominately concentrate on resolving the essential Olympics-specific tourism arrangements for Olympics-related and Olympics-motivated tourism (as defined in the VisitBritain report on Optimising the potential Tourism benefits of the Olympic and Paralympic Games).

While it is also important to improve the UK’s performance as a world class tourism destination, this is something that must be done regardless of the Olympics and these aspects should be primarily resolved through either a national tourism strategy or through separate specialist strategies. Therefore, the focus of this submission is on ensuring that the Olympics-specific tourism arrangements are appropriate.

Olympics-Specific Tourism Arrangements

  1. Putting in Place the Arrangements for Co-ordination

The single key issue to be resolved as part of the Welcome>Legacy strategy is the development, implementation and appropriate resourcing of arrangements between the various tourism-related agencies and organisations required to maximise the opportunity afforded by hosting the Games.

The greatest part of this opportunity is to stimulate additional Olympics-motivated tourism through the unequalled global exposure that this event will generate. The main mechanism for doing this will be by undertaking marketing programmes in source markets around the world and working with the estimated 20,000 international journalists and broadcasters that will attend the Games.

The Olympics represents a truly once in a lifetime opportunity to showcase London and the UK to the world. The proper utilisation of overseas public and media interest in London and the UK during the period up to, and over, the Games provides a unique opportunity to generate a step-change in the perceptions of Britain as an international tourism destination, achieving extra growth in inbound tourism and longer term improvement in domestic tourism. If we are able to develop and implement a marketing strategy that successfully leverage this public and media interest, the long-term benefits to the UK tourism industry will be considerable.

Ownership and Delivery of the Strategy

To achieve this requires a strong degree of ownership and leadership. The difficulty of this task is exacerbated by the organisational aspects of the Olympics (ie., the IOC and LOCOG), its facilitation (ie., ODA, TfL, Mayor of London, DCMS and the BOA) and the complex and diffuse situation of devolved tourism responsibility across the home nations, London, the RDAs, RDPs and Local Authorities. Therefore, if the £2bn target is to be achieved, then DCMS needs to take overall ownership of the strategy and allocate sufficient resources towards its implementation.

While DCMS must retain overall ownership of the strategy, it is not in a position to ensure delivery. Therefore, there needs to be a cohesive arrangement between the main entities that can ensure the optimum co-ordination of marketing programmes and clarity of communications both in the domestic and overseas markets. The evidence from past Games is that the hype associated with this exceptional event engenders mounting confusion and competition between national and regional tourism organisations, where cohesion is required. This is potentially even more likely given the devolved nature of tourism responsibilities in the UK.

Co-ordination of the Marketing and Communication Strategy

The Tourism Alliance view is that, the two main players, Visit London and VisitBritain should form a joint “Olympics Tourism Co-ordination Unit” to take ownership of the marketing and communications aspects of the Welcome>Legacy strategy. As the media coverage will be the core tourism-related benefit from the Games, one of the key requirements of the Co-ordination Unit would be to develop a co-ordinated media strategy to ensure that the benefits associated with the media coverage are spread across the country.

The formation of a joint unit would also avoid the creation of a new NDPB with the partner organisations retaining autonomy over their own programmes and activities, except to the extent that co-operative activities are agreed between them. While there are issues relating to the ultimate direction and accountability of a joint unit, we believe that these issues can be resolved by agreement between the parties, DCMS and the other main players.

In taking ownership of the marketing and communications aspects of the strategy, the other key functions of the Co-ordination Unit will be to link to the UK’s national and regional tourism bodies in order to provide national consistency, to maximise industry participation in marketing activities and to provide the industry with clear guidance on marketing and branding issues and assistance with approved campaigns.

To gain the necessary input of the home nations, English regions and the industry associations (such as the Tourism Alliance) in the formulation and implementation of marketing and communications activities, we believe that an Advisory Committee to the joint unit is required. This will help ensure that the tourism-related benefits are spread as widely as possible.

Developing a Tourism Network

Alongside the establishment of a Co-ordination Unit for developing and implementing the marketing, media and communication components of the Welcome>Legacy strategy, there also needs to be a network through which the work of the Unit can be disseminated and agreed cooperative programmes between the national, regional and local tourism delivery partners, trade associations and the industry developed and implemented.

This could be done through the establishment of an Olympic Tourism Forum connected to the Joint Unit and with members drawn from a wide range of tourism interests. This function of the Forum would be to help unify the understanding and effort of the wider tourism industry so as to co-ordinate activities and provide consistent and coherent marketing and communications.

Importantly, if the Welcome>Legacy strategy is to be successful, this structure, with the appropriate funding, needs to be in place with a clear and agreed marketing strategy and materials before the Beijing Games finish. There is already an immense amount of strategic planning going on all around the country in a vacuum, with no clarity of key facts, methods or outcomes. The sooner this effort is better informed and channelled, the better the outcome will be for all.

Funding the Strategy

On the issue of funding, the Tourism Alliance believes that funding for the implementation of the marketing, communication and other essential components of the strategy must combine public funding for critical elements that cannot be achieved through commercial activity, with maximum private sector participation. Government commitment to adequate funding for the non-commercial essential elements must be confirmed at the launch of the Strategy.

This funding should follow the model successfully developed and implemented as the “Only in Britain, Only in 2002” campaign in the wake of the Foot and Mouth Outbreak and the terrorist attacks of 9/11. Under this model, the Government committed £20m of funding from the Treasury Reserve, which was match-funded by the tourism industry to create a total of £40m in cash and support-in-kind.

This funding model encouraged industry participation and led to a very effective campaign that was proven to have generated an additional 1 million overseas visitors who contributed £500m to the UK economy. Using the same model for funding the marketing of the Olympic Games would provide an incentive for the industry to participate and thereby galvanise the industry support and involvement necessary to achieve the £2bn target. Government funding and authority is essential to this.

  1. Tourism Industry Participation

In addition to the industry involvement through match-funding of marketing activities through the Co-ordination Unit, there are other mechanisms whereby the industry will be able to contribute to the success of the Olympic Games. Paramount here is the development and implementation of more specific versions of the Olympic Tourism Charter that was launched last year.

Having key industry groups signing up to specific guarantees will build confidence within both the domestic and international markets that these Games will be accessible and deliver assured value and quality rather than being used for short-term gain by the industry (ie., allay fears of price ramping, overcrowding and exclusivity). This will be an important component of a strategy to minimise the expected downturn in “normal” domestic tourism and inbound tourism numbers during 2012.