Robert Broadfoot, Managing Director, Political & Economic Risk Consultancy Ltd. 

Asia in 2003 will be on a solid road to recovery, said Broadfoot.  It will still involve four main regions but Greater China will enjoy an enhanced position. As markets open, technology will play an increasing role and the Internet will develop a greater Asian dimension, overcoming its current English-based status. He forecast that some businesses, like computers and telecommunications, would move out of Asia. 

Infrastructure development, for which Asia was estimated to need US$1.3 trillion in the past but did not have the financial infrastructure to support, would resume but depend more on internal financial resources than foreign money. 

Mr Broadfoot forecast various scenarios for China. It could either be overcome by systemic deficiencies, or stay ahead of them. The external environment could become highly favourable, or highly unfavourable. At the moment, the systemic problems were becoming more acute. How it handles Hong Kong will also be important, because if it does not, China won't be able to raise capital on the global money markets. 

He classified Japan as another country that 'has to get it right.' At the moment, it faces the choice between making substantial or superficial reforms. He felt the government was not instituting enough substantive reforms. However, getting Asia right means getting China and Japan right. 

Three major signposts for the future were whether China would devalue the renminbi, the huge need to improve its housing situation, and Japanese banking reform which is so far inadequate. The Chinese decision on devaluation was crucial and would also be highly political. He figured that a devaluation was inevitable unless it was blocked by opponents of reform. As for China's housing, he said it was in a terrible state and that there was a huge need to improve it. 
 
 He noted the various big picture forces that were pushing and pulling within Asia, between internationalism and nationalism, and between taking a gradualist approach to economic reform or administering shock-therapy to asset values. Finally, sorting the winners from the losers would "depend largely on whether reforms are served as hot as they are cooked." He listed the various countries and graded them according to the level of confidence in their political and economic future. 
 

2. Changing Customers, Changing Srategies

Dr. Marvin Cetron, President, Forecasting International 

Marvin Cetron gave a fascinating futurist view of the global economy over the next four to five years with clear assessments of the impact on both the hotels and restaurants industry. On the economic front, he forecast that most of the economies, including those in trouble, would right themselves and that as a result, travel would remain buoyant. Multinational corporation mergers would continue, as would liberalisation and deregulation of the doing business atmosphere. Technology will continue to impact our lives. 

As a result of speed, however, time would become the world's most precious commodity. This would mean that shorter vacations spread throughout the year would become the norm. Lifelong learning will become essential. All our knowledge today will be just one per cent of the knowledge that will be available in the year 2050. Changes in values and lifestyles will also bring about a clash with the conservative cultures of Asia. Environmental concerns will continue to grow. 

He noted the sharply diverging values of the Baby-Boomer generation of the 40+ and the so-called ".COM" generation. Today, the under-30s represent about 22% of the European population. The age at which at least half of young Europeans either have a job or are seeking one has risen from 18 in 1987 to 20 in 1995. World-wide, the so-called Generation X young people are starting new businesses at an unprecedented rate. They have little or no loyalty to their employers, established political parties or even to branded products. 

The single most powerful trend in business for the last 20 years has been for the big to get bigger, thanks to economies of scale, for the small to prosper by providing high levels of service in niche-markets and for the middle-sized, lacking either advantage, to get either squeezed out or absorbed by larger competitors. This consolidation has yet to run its course and will be particularly strong in the hotel industry. 

Finally, Cetron said, service, service, service will replace location, location, location. Any product or service can easily be imitated. Increasingly, what distinguishes one provider from another is attention to detail. Eventually, the best-laid plans will require attentive management to implement them. 
 

3. The Revolution in Marketing Rules: From Mass Marketing to One - to - One

Dr Chekitan Dev, Associate Professor of Strategic Marketing, School of Hotel Administration, Cornell University 

Dr Dev gave a rundown of the new marketing paradigms emerging for the next millennium and the way the hospitality industry is changing across the board. He noted that the pace of change was so rapid that many of the changes he was outlining would be over-written by 1999. At the same time, companies have a tremendous opportunity to discard some of the old concepts of doing business and rethink what they need to do and how they do it. 

For example, he noted that companies no longer want to be market-driven but market drivers. Companies like Marriott want to be making the rules, not following them. Another buzzword, unique selling proposition, was being replaced by value-added proposition which required putting a value on time and the need to get more work done in the time available. Baby boomers are no longer looking for the meaning of life but a life of meaning. Companies like Virgin Atlantic are setting new standards in giving value added services. 

The message imparted to customers is also having to change. In previous sales training, the focus was on imparting the benefits of a product. Now, people want solutions. And the message from the customer is that the solution has to be the best, fastest, biggest and cheapest, or else he is going somewhere else. Companies are also rejigging their messages to focus on solutions, as IBM did recently with its new slogan, �Solutions for a small planet.� 

Companies are also delivering on new ways to sell products. Dr Dev cited the example of a bar in Munich that was located opposite the stock exchange and had configured, with the help of rows of vertical light-bulbs, the prices of its drinks. Depending on how many drinks are ordered, the prices go up and down, and are indicated on the lightbulbs. The bar is packed all the time and there is a queue at the door. 

He also forecast that the current monologue model of market research would be replaced by a dialogue model that would allow constant feedback to be given on a regular basis, often on-line. Establishing dialogue is the critical component. Companies can save a lot of money by doing a lot less conventional research. 
 

4. Competing in a Changing Marketplace

Scott Andersen, Executive Vice-President, Sales & Marketing, Cendant Corporation 

Andersen charted the rotating fortunes of the Hospitality Golden Triangle, in which each corner represents Finance, Employees and Guest. He noted that in the early 1970s, it was the guest who was at the top corner, which turned in the 1980s to put the employees on top and has now turned again to put finance on top. 

However, he forecast that the guests would again be in the top corner in the age of one-to-one marketing and that all the new emerging yield management and distribution tools were designed to put more focus on loyalty and generation of customer satisfaction. He described one to one marketing as marketing the right thing to the right person at the right time with the right value. This will mean that hotels would have to create a data warehouse, design data mining systems and then decide which tactical communications tools they plan to use to reach the customer. 

Andersen gave a detailed analysis of the power of global distribution systems and concluded by noting that the hospitality golden triangle would soon turn into a hospitality golden circle under which no single corner would be on �top� but that guests, employees and finance would all benefit from providing dedicated customer service through one-to-one marketing. 
 

5. Webonomics: Better Business Through the Web

Peter O'Connor, Assistant Professor, Institut de Management Hôtelier International & 
Patrick Horan, Lecturer, Dublin Institute of Technology 

The World Wide Web has tremendous potential as a marketing, promotion and sales tool for the tourism sector. Messrs Connor and Horan focused on clarifying the match between the characteristics of the tourism product and the capabilities of the Web, and also provided very practical guidelines on how to plan, develop, publicise, promote and maintain an effective tourism Web site. 

The speakers showed exactly why the Internet was a perfect vehicle for distribution of travel products, overcoming problems of cost, currency and volume of information, even while bypassing traditional channels of distribution. They noted that the profile of Internet users also indicated the presence of consumers well-inclined towards buying travel products on the Net. Its also a major boon for marketers. �With newspaper advertising, your marketing efforts are sitting in a dustbin the next day. A web-page continues working for you until you remove it or change it.� 

Web pages can also be personalised, and responses monitored. Some hotel groups are designing Webpages such that they can monitor precisely which ones are being looked at more often than others. Internet bookings cost about 20% less than one processed through a Central Reservations Office. They noted the pitfalls and differences with traditional marketing approaches under which one size usually fits all, a concept that can be counterproductive for Web marketing. 

The professors took delegates through the entire process of developing a website. One of the most important aspects of this process was the first one, analysis, that involves gathering and comparing information about the web and especially the target audience that one is seeking to reach. 

"This can have a great deal of impact on what information should be provided to a user about a particular product or topic. Similarly, analysing the web's purpose in light of other new developments, such as the contents of a competitor's web, must be an ongoing process. This stage finds answers to the six main questions -- Who? What? Why? Where? How? When?"  From that point on, one moves on to planning the website and designing it, before `publishing' and promoting it. Thereafter, it needs to be improved and updated constantly. 
 
6. Winning with Your Best Customers

John Cahill, Senior Vice-President Information Technology, Inter-Continental Hotels & Resorts 

Of the all the major changes taking place in the marketplace, perhaps the most important is that the customer now knows the meaning of �lifetime� value. Not only is the customer king, but he knows his current value and also expects added value. Neither segment nor mass marketing can prove adequate to reach this type of customer. Competition is extensive, it is both local and global, information is ubiquitous, change is rapid, competitor response is rapid, new media channels are appearing, and marketing funds are both finite and fragmented.  In the face of this, Inter-Continental's approach to customer management is divided into three tiers: Alliance Databases, Global 2000 and the Six Continents Club. 
 
Alliance databases give Inter-Con access to more than 15 million potential customers in travel and non-travel areas, including financial, retail, telecommunications and media. Just from the airline alliances alone, Inter-Con had generated 677,600 room nights in global mileage awards, and there was considerable potential for exploiting those further. 

One tier up, Inter-Con had its database of Global 2000 guests, a total of about two million occasional guests with over 12 million stay records. Inter-Con had access to their reservation records, travel agent data, frequent flyer information and spend information, all of which could be used for data analysis and mining. Some of the information could also be shared with partners and alliances. 

The Six Continents Club of about 250,000 members constitute the top tier of the target market. These held considerable promise for further marketing efforts to maintain their loyalty through continued research even while maintaining the global integrity of the programme and the exclusivity of the membership. 

For them, the short-term object is to move from mass to tailored communication based on known travel patterns, known needs or past behaviour and, more importantly, incentivise further loyalty / spend levels. 

To gain overall success a comprehensive customer management strategy had to be integrated with both the overall business and technological strategies, and have a strong belief in the value it generates vs. the cost it involves. Moreover, there has to be a long-term commitment as well as willingness to change. 

Michael Ferrier, VP Operations & Strategic Sales, Asia Pacific, Micros-Fidelio International 

Property management systems introduced in the late 80s and early 90s to capture guest history and marketing data have graduated into more sophisticated databases and are evolving further to incorporate data right across hotel groups. Even so, technology �is no longer the overriding issue; the level of success achieved when deploying (it) has largely come down to how effectively hotels or hotel groups utilise the technology." 

Mr Ferrier said this refers to the quality of the data that goes into the computer systems, management of the databases, selection of the correct profile during reservation, accuracy of reporting and effectiveness of mailings and other marketing programmes. �Hotels are still not fully appreciating the importance of these controls in their role in maximising return on investment� in the technology. 

He noted that as hotel groups focus on providing the same high standards of customer service right across their properties, two trends are evolving in the hospitality industry: 1) centralisation and deployment of marketing and guest-related data across the group; and 2) centralisation of hotel group operations in cities, regions or destinations. 

By centralising guest/marketing data, hotels can provide constant service levels and standard pricing across the group, higher levels of guest recognition, they can link in with membership schemes and awards, and automate the sales force and group-wide reporting and analysis. In turn, by centralising their hotel operations, they can reduce hardware/software and manpower costs, improve data security and operate a central guest and reservation database. 

 Micros-Fidelio is responding to both these trends with the development of appropriate products suited to both hotel groups under a single management structure or a group of non-aligned hotels wishing to share resources. Either way, the basic need is to provide customer service and generate guest loyalty. Based on this, the hotel database is arguably the most valuable asset the hotel has in building this loyalty and encouraging repeat business. 

Hans Lindh, Director, Lodging Industry, American Express Establishment Services 

How can independent hotels find new customers? Partner marketing offers them an option. Mr Lindh said that attracting customers means getting the database marketing right because it is an integral part of yield management. Despite the various technological means available to make better use of guest data, Mr Lindh said, �I would suggest that no (travel) industry gets a better opportunity to do database marketing and chooses to do so little about it, as the hotel industry.� 

He noted that while the hotel industry is otherwise so automated, the most strategic of all guest information (name, address, details and preferences, etc.,) are reliant on manual input. The greater the manual input, the greater the margin for error. Even if all these problems could be solved, the independent hotel would be able to market to its existing customers but have little opportunity to identify additional customers. 

Partner marketing would offer one way out. Here, he cited the Amex example, noting that in analysing, collecting and utilising this data, Amex �goes beyond the normal requirements of data protection legislation in each market so as to ensure that our Cardmembers privacy is respected in full.� He said that by examining their spending behaviour and doing market research, �we know what turns them on.� He added, �We have developed the technology that is capable of processing and interrogating the mountain of information we collect.� 

He said Amex members spend 13 nights on a hotel per quarter, of which four nights are spent for weekend/leisure, and five nights abroad. According to Amex hotel partners, Cardmembers spend 10-35% more than other guests. The company also runs its own rewards programme. He went on to outline some of the recent promotional marketing activities with European lodging partners. He concluded, �As valued business partners, hotels and restaurants of all sizes and characteristics have access to our most important asset -- our Cardmember database -- by way of numerous communication vehicles we have in place.� 
 
7. Navigating the Channels of Distribution

Daniel Connolly, Doctoral Candidate, Virginia Tech 

Global Distribution Systems are still very much in the running despite the growing array of distribution options available to the travel industry. They are still well placed to generate new revenues, reduce costs and overheads and drive customer, employee and shareholder satisfaction. 

Mr Connolly said GDS�s had been watching with considerable interest the projections for growth in on-line hotel bookings which are projected by the year 2001 to reach nearly 17 million trips totalling more than 2.8 billion dollars, according to Forrester Research. He described the GDS�s as the hotel�s �nervous system,� and as the potential initial point of guest contact as well as the primary vehicle for data collection, storage and dissemination. They can also acts as the keeper of the room inventory and the principal sales tool. 

The distribution processes were being affected by numerous issues, he said. Airline GDS�s had a �stranglehold on hotels,� travel agents are weakening as intermediaries, transaction costs are high and data inconsistencies are resulting in discrepancies in room availability and rates. Significantly, he said, there is a �defensive rather than pre-emptive use of Information Technology.� 

In response, GDS�s are reshaping themselves by bypassing airline GDS�s, reducing the role of travel agents and the commissions paid, taking advantage of emerging smart agents and capitalising on the rising popularity and capabilities of the Internet, complete with multimedia, voice capabilities and push technology. More change is yet to come as technology graduates on to internetworked environments, and the tendency for do-it-yourself bookings and voice-interactive commands increases. 

Eric Christensen, Chairman, WorldRes Inc. 

Hotel associations have very valuable roles to play in helping their members harness the distribution and reservation power of the Internet, said Eric Christensen. He cited the examples of the Hong Kong Hotel Association which is using the Internet to efficiently process reservations for their members at Hong Kong airport, and the California Hotel and Motel Association that has formed a partnership with the California Travel Industry Association to form Golden State Reservations. The California department of tourism refers to the reservation programme throughout the State�s US$12 million advertising programme. 

Mr Christensen said that in five to 10 years, the Internet will be THE dominant distribution channel as consumers and intermediaries move to the Web for better rates, searching options, email promotions and database comparison shopping, including customer feedback. Bookings over the Internet will grow from less than one per cent today to 35% of the total in that period. 

He cited several examples of how email promotions are being used to deliver results, such as by America Online, the Tahoe Seasons Resort and the San Diego Hyatt. It�s not just more people getting on-line, more people are BUYING on-line, he said. Of the estimated 150 million public users of the Internet in 1998, 30 million made purchases over the Internet, of which 2 million made on-line hotel reservations. These figures are projected to rise respectively to 300 million, 80 million and eight million by the year 2000. 

He also discussed how WorldRes was moving in line with the times as it had been built specifically to serve accommodation providers, not airlines, and designed to take advantage of the Internet�s low cost, graphical capabilities and interactivity. In addition, WorldRes could also market and sell hotels directly to consumers and businesses via the Web. Hotels join for free, work with WorldRes directly over the Internet, and only pay for transactions received through the network. 
 
8. Closing the Look to Book Cycle

Jack Geddes, Managing Director Sales & Marketing Asia, Radisson Hotels Worldwide 

Today, customers using the Web for travel planning are looking for deals. They understand that suppliers are cutting costs through this channel and expect savings to be passed on to them, as well as being rewarded for making the booking themselves. With that, Mr Geddes outlined Radisson Hotels' strategy for receiving 100% of bookings electronically as against the current status: 62% through the GDS, 37% over the phone and one per cent over the Internet. 

He pointed out that the first effort to move travel agents from telephone to electronic channels by using reward incentives was launched in 1992. So far, over 190,000 travel agents from 94 countries have enrolled and redeemed US$13 million in awards. 
Now, he said, it was time to move guests from telephone to electronic channels, mainly over the Radisson website which now has real-time reservation capability and a direct interface to the Radisson central reservation system. To attract more bookings, weekly hot deals are offered, bookable only on the website. This helps incentivise customer to book on-line through the Radisson website and also generates incremental business for hotels by selling �distressed� inventory. 

Mr Geddes said today 40% of total monthly bookings over the website are Hot Deals Rates and that bookings are up 323% over 1997. User visits are up 31%, customer profiles are up 248%, net room nights are up 262%, room revenue is up 297% and ADR is up 8% . The conversion rate from lookers to bookers was only .006% in 1997 but rose to more than 2% in 1998. 

Radisson�s latest move is to promote the Hot Deals to 21,000 email subscribers and do cross-promotions with partners that take in more than 600,000 weekly email shots. These are combined by offering triple mileage points. In June 1998, Radisson launched E-scapes, the hotel industry�s first-ever email service offering notification of vacation packages that match a customer�s stated travel preferences. The result: on-line bookings shot up by 1,000 to about 6,000 in July 1998. 

Pete Brady, Managing Director, BusinessMeetings.com 

In explaining the concept and creation of his website, BusinessMeetings.com, Pete Brady highlighted its simplicity and said, �We did not set out to create a service in which the technology is so clever that it defies understanding by its user....We simply respect the need of the customer for relevant and useful information, that way they will be ready to make their choice and their business decision.� 

BusinessMeetings.com is a website for meeting planners, with over 34,000 venues onsite today. Brady developed it to be �not only the first port of call for the meeting planner but also the inevitable one.� In doing so, he took the simple and easy approach, not allowing technology to dominate the process but adapting technology to meet the fundamental needs of people seeking information. 

These fundamental needs are: Where they can find out about a product or service, What information they need to gather about that product and its competitors, then deciding Whether they are going to go ahead and make that purchase, moving on to How they can action the information and complete the transaction and finally, How Often will they stay loyal after they have tried the product once. 

Using his website as an example, Brady went on to describe how he designed and structured it to meet those criteria. The idea was to make technology the servant of the human, not the other way around. �For those businesses that recognise this simple fact, the future is bright.� 

He noted that while this has been a century of amazing technological change, �what is fascinating is not the technology itself, but the ability of human beings to absorb and adapt (it) to their own needs and to the needs of society. This society is now seeking �choice� in all things, especially information-based choice.� 
 
 9. Workshop for Independent Hotel Operators

Andrew McBurnie, General Manager, Pan Pacific Hotel, Manila 

Mr McBurnie unveiled what he called the concept of the future in Asian hotel management, a flat, efficient, economically astute structure that allows the Pan Pacific, Manila, a 250-room hotel with 30 F&B outlets to operate with 170 employees.  Not only does this translate into good business sense for the owners, it creates a corps of multi-skilled employees who never contest the politics of promotions, because there aren�t any, but rather devote their full energies to generating guest satisfaction. 

The outsourcing of the F&B outlets is critical. Mr McBurnie noted that while F&B outlets generate only 20% of an average hotel�s profit, managements focus 70% of their energy on F&B management. In the Pan Pacific Manila, all 30 F&B outlets are outsourced while remaining in the same complex as the hotel building, creating a huge food court patronised by both locals and hotel guests. The room service menus reflect this diversity. 

The Hotel does not lose control when it outsources because it chooses its suppliers carefully and maintains quality control by retaining the right to revoke guest signing privileges, banqueting business, co-branding and co-marketing privileges. Overall, outsourcing generates 60-65% of the Pan Pacific�s Gross Operating Profit, as against 35-40% in other hotels. 

The same revolutionary concept applies to operations. In traditional hotels, the management structure is hierarchical starting from the GM downwards to the resident managers, assistant managers, department heads, supervisors, etc. In the Pan Pacific, there is only a steering committee of five people. Operations managers and the rest are butlers who do everything from cleaning the rooms to providing concierge and business-centre services. 

The hotel�s management philosophy is to hire the best and brightest, tell them clearly what is expected of them, give them the tools and authority required and then get out of their way. The Butlers operate under a self-directed work team ethic with no supervisors. The Steering Committee identifies the What, and the Butlers take care of the How-to. When guests want anything, they just contact their floor butler, rather than housekeeping, room service, the concierge or the front desk. 

The butlers are rewarded on the basis of their competency, with each new skill they acquire earning them more money. The decide their own pace of learning. This allows the entire hotel concept and resources to be centred around the guest, not around the administration or operation. �Our people will grow more quickly than in a traditional environment and would become the pre-opening task-force in any future development,� he said. 
 
10. Workshop on Forces Driving Change in the Casual Theme Restaurant Industry

Michael Olsen, Director of Research, IH&RA and Professor of Strategic Management, Virginia Polytechnic institute and State University. 

The casual theme restaurant industry is facing a number of growing challenges, said Dr Olsen. These include restless, demanding consumers, growing complexity of the human resource environment, a declining natural resource base and the drive of technology into the work and home environment. 

Under each, Dr Olsen listed the evolving psychographic changes, noting especially the arrival of a 'reflective consumer' who is turning increasingly to spirituality to come to terms with the world and growing conservatism to address the paradoxes of life. He noticed the trend towards a less macho world, growing demands for safety and security and growing expectations for higher levels of just about everything. 

Tracking the human resource environment, Dr Olsen mentioned the long problem of balancing skill level vs. employability, the changing nature of work that is making things more demanding, more intellectual and more expensive per unit of labour input. He cited job stress and even violence in the workplace. Moreover, the industry faced the challenge of preserving the natural resource base, including air and water supply, land use and the entire question of sustainable development. 

The Scale & Structure of the Global Restaurant Industry 

Dr Olsen and Ph.D. candidate Jeong-Gil Choi then gave a detailed statistical rundown of the global restaurant industry, noting that among the 11 regions they had divided the globe into, the average size of the restaurant industry ranged from 4,723 restaurants in the Caribbean to 698,040 in Northeast Asia. The number of restaurants in Northeast Asia represents 43% of total restaurants world-wide. China is the largest market in terms of number of units. 

Average employment in restaurants ranges from 38,620 in Central America to nearly 3.8 million in North America. The average revenue for the industry ranges from US$183.42 million in Central America to US$118.6 billion in North America (which represents 51% of total global restaurant revenue). 

China Restaurant Industry -- Jinlin Zhao, Coordinator of Hospitality Management, Western Carolina University 

Dr Zhao noted that political and economic reform in China had now led to over 90% of the restaurants being in private hands. Against this, Chinese lifestyle and eating habits are changing. Among the major macro forces driving change, Dr Zhao mentioned the 1995 enactment of the food safety and sanitation law, guiding principles of Chinese fast-food development and the classification of restaurants and 
hotels. 

He cited the fact that food is cheap and affordable in China and that as eating habits change, there is a growing adoption of foreign food. The restaurant industry itself is broken up into two major markets: domestic and overseas. In 1996, the domestic market generated 202 billion yuan, up 28% over 1995, and employed 7.75 million people. Of the overseas market, the total of 5,201 hotels in 1997 reported total revenues of 81.2 billion yuan of which F&B generated 32% of the total. Hotels employed 1.36 million people in 1997, up from 876,700 in 1993. 

As for future opportunities in the Chinese restaurant industry, Dr Zhao identified the potential for brand-name development, mergers and buyouts amongst chain establishments, management training, standardisation and application of new technologies. 

Focus on Korea - Jeong-Gil Choi, Doctoral Candidate, Virginia Polytechnic & State University 

Dr Choi gave a broad overview of the economic and financial changes taking place in Korea. Up until 1996, before the economic crisis started, growth in the Korean restaurant industry had been constant. In 1997, the country had 560,000 restaurants, 52 of which were in Seoul and Koyonggi province. They chalked up total sales of US$28.75 billion and employed about one million people. Eating out constituted about 7% of disposable income. The industry is also extremely labour intensive; sales per employee were US$28,750, much lower than the US which had a corresponding figure of US$50,718 in 1998. 

Answering the critical question of how the economic crisis is impacting on the restaurant sales, Dr Choi quoted the president of the Korea weekly restaurant business newspaper as citing three reasons for declining sales: fewer customers using restaurants to entertain; reduction of the average cheque due to lower disposable income; and decreasing group dining. He said the bankruptcy rate is 30-40%. 

As changes sweep through the industry, restaurant operators will have to deal with the shortage of qualified management, hygiene and low demand for advanced technology. Investment opportunities will open in the supply of hospitality equipment, mergers and acquisitions and the hotel-restaurant market. Many of these will leave restaurateurs to forge stronger relationships with local developers, joint ventures, 'arms-length' franchise-agreements and trademarks and licensing. 

Indian Restaurant Industry - Amit Sharma, Doctoral Candidate, Virginia Polytechnic & State University 

The Indian restaurant industry is also undergoing major changes in line with the growing population and economic development. It is classified as high-growth, even though highly-fragmented. There was some tremendous dynamism in the industry as epitomised by the push and pull forces at work between five-star hotel vs. non-hotel eating outlets and between MNCs vs. local chains and operators. Dr Sharma noted that home food consumption takes up to half of total food expenditure, with vegetarians accounting for over 60%. 

A major industry force driving change was the expanding scope of operations towards shopping malls, recreational complexes and food courts, delivery services and institutional catering. He also referred to the diversity of the workplace in terms of gender, caste, religious and social values. In view of limited financial resources, there was a high dependence on personal resources or external financing. 

Mr Sharma noted that future opportunities would lie in the channels for mass consumption for people with limited disposable income, such as catering services among the world's biggest railway network and movie houses. 
 
11. Food Safety - An International Issue

Yoshinaga Doi, Advisor to Kentucky Fried Chicken Japan 

Pointing to the increasing number of food poisoning cases in Japan, Mr Doi called for the establishment of global standards and a common certification system among global food-service professionals. He noted that in Japan and around the world, there was growing popularity of ethnic foods such as Thai, Vietnamese and Chinese because they are inexpensive and represent different cultural flavour. 

�Considering the fact that a variety of ingredients are imported from many different countries, it is desirable for us to establish global standards for handling food materials in a safe and sanitary fashion in various stages from distribution to cooking and serving. For this purpose, I would like to propose that the restaurants association of each country or each territory should actively exchange more information with each other....and discuss how to establish a common certification system for safe food materials, based on the HAACP concept or other reliable standards for food safety.� 

Mr Doi said that in 1997 alone, there had been 1,700 cases of food poisoning in Japan of which vibrios parahaemolyticus and salmonellae accounted for about 60% and E:Coli O157:H7 for an additional 8%. He noted that foodservice providers are having to become more alert in serving safe and sanitary food to their customers. �If we correctly recognise our responsibilities and properly respond to our customers, we will be able to obtain more trust from them and our business opportunities may increase.� 

Mr Doi also noted that because the government, in view of the current economic problems, could not be expected to field more foodservice inspectors, it was important for the industry itself to become more self-regulatory. The Japan Foodservice Association has been holding a series of workshops and seminars and undertaking a number of other communication activities to keep its members informed about food safety. Extending this co-operation and communications internationally would be welcome, he said. 
 
12. Fish Where the Fish Are....and Use the Right Fly 

Grahame Senior, Chief Executive, Senior King Ltd., and President, Independent Network of Agencies. 

Describing the tourism market as being "fickle, ruthless, promiscuous and hopelessly over-indulged," Mr Senior said that business travel, the hospitality industry, society and economies were all in a state of radical, dynamic flux world-wide. With travel, tourism and leisure marketing being all about communicating the right message to the right people at the right time, it was important to fish where the fish are and use the right fly. "Remember...it is the fish which DECIDES to take the fly" and the seller has to do everything to make it possible for that decision to be made. 

He noted the various socio-economic changes taking place, including fragmenting families, the emergence of a new generation of buyers known as the 'limbo generation" who are too old to be young and too young to be old. In the UK, not only are fewer people marrying but the divorce rate is the second highest in the EU. 

How is this impacting on marketing? Mr Senior cited the example of the car which is driven by passion, marketed with flair and yet proscribed by society as 'irresponsible, reckless, wasteful and selfish.' Car journeys over the weekend are marked by awesome congestion so much so that people now plan less stressful journeys, minimise use of the car for longer journeys and use it only on a discretionary basis. 

He also cited the emerging competition from home entertainment in the field of cable and pay-per-view TV channels, even gardening. He forecast a big move by retail giants like Walmart and Intermarché into leisure travel, seeing the possibility of future leisure attractions that have no entrance fees, involve precious little travel distance and satisfy all needs. 
 
The marketing revolution, Mr Senior said, was going in two directions: 1) Markets are focusing on one-to-one efforts; while 2) brands are focusing on one-to-everyone. After citing the basic service requirements of a hotel in terms of attracting and maintaining customers, he stated, "The future for serviced accommodation and hospitality products within the leisure and business travel markets lies in accurate one-to-one marketing beneath an effective brand umbrella." 

He then gave a detailed outline of how his company re-engineered the marketing of Champney's -- "It is not a place, it is an experience." The new marketing slogan is "Nowhere else makes you feel this good." His discussion took the audience through the whole process of making the change, from researching and identifying the market, to empowering the staff, to the investment and marketing plans that went into it. 
 

13. The Value of Brand Marketing Strategies

Eric Pfeffer, Chairman & CEO, Hotel Division, Cendant Corporation 

The fact that less than 25% of hotels outside the US and Europe are branded is indicative of the expansion opportunities available for branded hotel groups. Defining a `brand' as `a predisposition to use a product/service', Mr Pfeffer asked delegates to think about their last business trip and identify what airline they flew, the car rental company they used, the car they drove, where they stayed and what kind of laptop they took along. Invariably, their choice was influenced by the brand they were familiar with. 

Mr Pfeffer cited research figures showing that branded chains enjoyed both higher occupancies and average room rates than independent hotels. They also had a higher growth in room revenue, room availability and rooms sold. Independents were reported to have suffered declines in both available and sold rooms in January-July 1998 over 1997. 

Mr Pfeffer said the atmosphere for international expansion was also ripe as countries embrace free market technologies, the economic centre of gravity shifts from developed to developing countries, technology helps improve communications and borders open to trade, investment and technology transfers. 

The same scenario applied to the growth prospects for international franchising which Mr Pfeffer said was well known in the US and Canada and catching on in Asia while "Europe is still learning." In expanding franchises, he said the franchisee relied very much on local partners to use his experience to develop the brand in the country or the region. Hence, it is important to identify the right partner. 

He gave a rundown of Cendant's current global position and noted that after forging strategic alliances across the 1990s, the new move was to develop cross-marketing synergies among the brands. This meant links between say, RCI and Days Inn, Avis and Travelodge and Entertainment and Howard Johnson. With the variety of brands available under the Cendant banner, this should considerably strengthen its marketing muscle. 

Danai Wansom, Senior VP Marketing and Sales, Century Hotels and Resorts 

If there's one solution to the range of challenges in getting a name out into the market, it is to `build a famous brand.' Mr Danai outlined the various ways this could be done, for example, by aiming high, thinking big, demonstrating value, owning a unique position, establishing stature and reputation and recruiting and inspiring the best staff. 

He noted that Century's philosophy was to be the leading mid-market hotel operator in Asia, one that delivered value for money, had a consistent management, high standards and, importantly, an identifiable brand. Mr Danai then outlined the various marketing and promotional strategies to do exactly that. 

Stressing the importance of branding in creating customer loyalty, he forecast that mergers, buyouts and take-overs in the hotel industry will continue as established brands increase market share. Successful companies will migrate from an asset focus to a customer focus. "We need to ensure that all activities relating to the brand reflect, build and stay true to the core values and spirit of the brand." 

In conclusion: The development of a brand name is a key element in developing the identity of the brand. The brand should suggest something about the product's benefits and qualities, it should be easy to pronounce, recognise and remember. It should be distinctive and easily translatable into foreign languages without negative meanings. It should be capable of registration and legal protection. 
 

14. Asia Pacific in a New Light

Claas Elze, Vice-President of International Hotel Development Planning, Marriott International 

The Asian economic crisis is likely to result in less ego-driven hotel development and more market-oriented products. The existing oversupply of hotel rooms in many markets will result in the survival of the fittest, with the older hotels - often overstaffed and lacking capital investment - suffering most. 

Noting that the crisis has halted work on many non-viable projects, Mr Elze forecast that budget and economy segments of the hotel market will gain in importance. Independent hotels and small and regional chains will face increased difficulties, opening up the possibility that they may have to tie-up with international chains to survive. 

Marriott sees the need for an association grouping tour operators, hotels and airlines, to speak with one voice and launch joint marketing strategies. Mr Elze cited the Bali Promo, Amazing Thailand and Singapore Promotion campaigns as examples of the kind of joint marketing efforts that would work. �One hotel or even one chain cannot make a difference,� he said. 

Other forecasts: 1) Presently, virtually the entire Asian region is an emerging market. In particular, Kuala Lumpur and Bangkok will require substantial increases in demand to fill the newly-built rooms; and 2) Among the resort destinations, only Bali and Phuket have the critical mass of hotels and air access to provide a truly international profile. 

Mr Elze noted that foreign investors are interested in picking up many of the for-sale assets around the region but have been disappointed by continued legal uncertainty and the gap in the perception of asset values. �What�s for sale is often just a mortgage which can�t be foreclosed on easily,� he said. As more hotels come on to the market, it remains to be seen if owners have more realistic price and value expectations. 

Imtiaz Muqbil, Executive Editor, Travel Impact Newswire 

Mr Muqbil offered a socio-cultural perspective on the Asian crisis, noting that it had emanated partly because Asians lost sight of Mahatma Gandhi�s most memorable saying: �There is enough in this world for everyone�s need, but not for everyone�s greed.� 

He said blaming the crisis entirely on nepotism, cronyism and corruption in Asia was inaccurate. Currency speculators were equally responsible and needed to be reined in to prevent them from attacking Asian currencies in the future. Now, the crisis is forcing a great asset sell-off as well as calls for restructuring and reforming economies. 

He pointed to the culturally abrasive language that is being used to force Asian economies to make the changes. At the same time, he admitted that Asians became greedy, proud and arrogant and began believing their own propaganda about unending growth. 

He warned of the stirrings of nationalism, fanaticism and racism emerging in Asia and the potential impact this would have on Travel & Tourism as a promoter of cultural understanding, friendship and peace. He forecast that religious faith would make a comeback in Asia, and that the Travel & Tourism industry was well-placed to build bridges between people�s beliefs and their economic livelihoods. 

Mr Muqbil also forecast a resurgence of Asian creativity, more emphasis on character-building and greater questioning of canned solutions that may have worked well outside Asia but may not prove appropriate for Asia in the long-term. Right now, he noted that Asian intelligentsia were maintaining a silence in order not to upset those holding the purse-strings. This silence would be lifted once the economies are set right. 

Asia has fought off too many attempts at colonialism and imperialism over the years and is not about to tread down that path again, albeit in an economic guise, he argued. 

15. Closing Remarks

His Excellency, Joseph Ejercito Estrada, President of the Republic of the Philippines (speech delivered on his behalf by Secretary of Tourism, Gemma Cruz-Araneta) 

President Estrada noted that this was the first international tourism gathering to be held in Manila since he assumed the presidency and the second time that the Philippines was hosting the IH&RA congress. Referring to the economic crisis in the country, he quoted a local journalist as noting that the Filipino was no stranger to crisis. �From one administration to the other, there was always some political upheaval, economic downturn or natural calamity that imperilled the unity of the country and the Filipinos� resolve to survive. It is our belief that from difficulties shall emerge opportunities and successes.� 

President Estrada pointed to various projections that the Philippines will be among the first to snap out of the Asian economic turmoil. He pledged that his administration would provide the needed policy adjustments to keep the structure of the Philippines economy fundamentally sound and ensure that the path to recovery is gradual but generally smooth. 

The President gave a broad account of the country�s tourism industry, especially the healthy growth projected in the hotels, resorts, inns and pension houses. In the first quarter of 1998 alone, the Board of Investment had approved tourism projects worth 12.26 billion pesos, accounting for another 2,204 rooms beyond the existing 17,000 rooms nation-wide. Hotels employ 48.90% of the people working in tourism. 

He outlined the �covenant� concluded recently between the DoT and 30 private sector tourism-related organisations covering 11 objectives for the development of tourism, including image, marketing, budgets, infrastructure, transport, destination development, legislation, investment, labour relations and manpower, peace and order, environmental concerns and consultative mechanisms. �These objectives are aimed at making our industry more responsive to the relatives both here and abroad. 

�Tourism shall be a major vehicle for the pursuit of economic progress,� the President said. �It shall be a tool to restore confidence in the Philippines. And it shall help relieve poverty and will boost the administration of social equity through community-based tourism initiatives.� 

The president also listed the various investment privileges and tax holidays given to foreigners to invest in the Philippines and make it conducive, user-friendly and financially viable for them. 

Larry Cruz, President, Hotel & Restaurant Association of the Philippines 

Mr Cruz thanked the IH&RA for choosing Manila as the venue for its 36th annual congress, as well as members of his host committee and Philippines President Joseph Estrada for sending a special representative to officiate at the opening. He noted that despite the economic crisis, the Filipino people would never flag in being their �charming best to visitors, welcoming friends and guests and offering everything there is on the table.� 

Mr Cruz thanked Singapore Airlines for coming to the rescue of the congress and flying in many of the delegates who would have missed out due to the temporary shutdown of Philippines Airlines. He also thanked the Department of Tourism for its logistical and funding support. 

Regardless of all the difficulties being faced by the Philippines and its tourism industry, Mr Cruz said that the Filipinos' eagerness to please, �an eagerness not commonly encountered in other parts of the world,� will help the country�s hospitality industry survive and flourish well into the next century and into the next millennium. 

�We hold the optimistic view that all these Asian woes...will come to pass sooner rather than later, with us at the forefront of the recovery. Our people have the skills and the competence to face the challenges of the future, and what�s more, the products to sell. We have a political environment that ensures the stability vital for investment and economic growth.� 

He noted the Philippines government�s commitment to alleviating poverty through pragmatic economic and business policies. �It is not surprising that in spite of the difficulties, the country remains upbeat on the future. We in the hospitality industry share that opti