Low-Cost Pejorative Or Imperative?

A pejorative is a word or term that carries negative connotations and is used to criticise, belittle and express a low opinion of an individual or a group of people. it can therefore be deployed, and is, to convey a lack of respect or hostility towards social classes or specific groups which share common characteristics. Depending on how they are expressed and on the context, certain words can assume the status of a pejorative. Expats is a good example.

A further one that is highly germane to Mallorca's socioeconomic circumstances is "low cost". Normally used as an adjective, it has become a substantive in its own right. Low cost as a concept is ipso facto a "bad thing", as it assumes a negative consequence by the very fact that cost is low.

We currently have a great deal of low cost to contend with, all of it business-related and, by implication, also associated with social class. Low Cost Travel Group is an obvious case in point. The name itself, which would have been looked upon in a pejorative manner by many even prior to its collapse, always had an inherent marketing conflict. Attractive to some, it would not have been to others. Because of the collapse, the naysayers will now claim that they were right all along. The business model, regardless of cover from bondholders or not, was flawed on account of the low-cost philosophy.

This isn't and shouldn't be the only conclusion to be drawn. Low cost doesn't have to mean an in-built business weakness. Indeed, the online travel agency would have been inspired by the very success of companies which have made a virtue (and lots of money) out of being low cost. Ryanair is one such.

Airlines like Ryanair have of course been condemned for a variety of reasons: sharp practice, not being as low cost as they might appear and rotten service. But the low-cost model for airlines has become so pervasive that it has overtaken regular airlines in terms of passenger numbers coming in and out of Palma's Son Sant Joan. To the ranks of Ryanair, easyJet, Norwegian, Vueling and others are to be added Air Europa Express, a belated attempt by Globalia to enter the low-cost market, and one which was met with the threat of pilot strike action.

It is informative that statistics are regularly released which indicate the level of this low-cost travel. This is informative not just because of the factual data but also because there is a sense that the data are presented with a pejorative in mind. There is a great deal of resistance to "low cost" in Mallorca of whatever kind it might be. It is a "bad thing".

The assumption, a totally false one, is that if a service is marketed as low cost it will automatically attract a class of traveller castigated by the unthinking pejorative of "low quality". We all know that some travellers are far from well-off, but the folly of this assumption was no better exposed than when the former president of the Majorca Tourist Board expressed it. The response was one of outrage from those who are perfectly well-off, thank you, but who still use low-cost airlines.

The assumption has been shot to pieces even more by an understanding of markets which reveals that consumers - filthy rich, better-off or on their uppers - are now so savvy that they seek out deals. The internet and social media have made this ever easier. Consumers, regardless of circumstance, aren't stupid. If they can spend less, if convenience is satisfied, then they'll make decisions based on these factors. There are naturally those whose aspirations and self-esteem (as well as money) would mean never willingly opting for the pejorative of low cost, but even they might have to if competition has made low cost the main or only option.

It's this word - competition - which says a lot about the antagonism towards low cost in Mallorca. For a tourist destination built on cost that wasn't just cheap as chips but cheaper, it is now payback time, and this comes in the form - it is hoped - of elevated hotel prices with improved quality attracting a tourism class which is the antithesis of what gave the island its wealth in the first place.

But while hoteliers might attempt to sew things up to their RevPar and bottom-line advantage, there is a whole other economy where the competitive forces of low cost are having field days. Airlines are just one example. There are also coach transfer services, car-hire agencies, shops. The list can go on. Hairdressers are another.

Defending local business and economic interests is valid enough, but it is a defence too often predicated on a demonising of operations which have disrupted one-time uncompetitive markets. Low cost is no pejorative, it has become an imperative.

The Giant Pumpkin Of Tourism

"The biggest fruit in the world." This was a headline on the BBC website's home page. The fruit was a pumpkin, a fruit in which I do not for one moment pretend to be an expert but which holds an affection because of the annual pumpkin-growing contest that is judged at Muro's autumn fair. In the US, pumpkins are as much as three or four times the size of anything a Mallorcan grower can aspire to: the giants pumpkins of America dwarf the giants of Muro.

No one would claim that giant pumpkins at a fair in a small rural town are in themselves going to make a difference to Mallorca's tourism, but the BBC's pumpkin article had a very clear touristic element. This wasn't contained in the article itself. It was the banner at the top of the article. "Visit Croatia. Share Croatia," it read. It had been placed on behalf of the Croatian National Tourist Board. These banners can be somewhat hit or miss in respect of where they might appear and so therefore who might see them, but this randomness notwithstanding, the banner spoke volumes. The difference between Croatia's tourism promotion and Mallorca's was stark. Croatia is active in a way that Mallorca most definitely isn't. Were Mallorca active, there might have been some appeal in a banner for the island featuring at the top of the pumpkin article. Not, as I say, because the pumpkin fair would have thousands of tourists beating a path to Muro but because it is indicative of an often batty, alternative Mallorca the regional government would so love the world to know about and yet which it fails so abjectly in informing.

Croatia is arguably the European champion of tourism promotion. It gets web promotion in a way that Mallorca mystifyingly doesn't, or as yet hasn't seen fit to genuinely embrace. The word "share" in the banner says much. Croatia's social-media presence is enormous, while Mallorca's is not; it is a giant pumpkin-sized approach versus a seedling. I have railed often enough against Mallorca's poor social-media activity and so wonder if the baffling lack of presence is indicative of a wider issue.

One senses that Mallorca's tourism is at a crossroads. A strategic desire is for the up-market, but is there truly an acceptance of such an exclusive market to the exclusion of others? Is, therefore, an incoherent approach to web promotion a manifestation of this uncertainty? Technology and marketing are combined in ways they never have been before, yet neither appears to have a clearly defined role. What does Mallorca want from web technology and what does it really want by way of its tourism market?

Neither the government nor the tourism industry can neglect the past. Despite an aloofness (a misguided one) that has been shown by some in Mallorca towards the current-day concept of low cost, it was precisely this - low cost - on which the island's modern-era tourism was based. The term is an invention from the 1990s, but Mallorca grew as a consequence of cheap-as-chips tourism for the masses and spawned some of the resort hideousness that the government would also so love to get to grips with. This was tourism of the giant-pumpkin variety. The larger the pumpkin, the less taste it has. Mallorca reaped what it had sown: a massive fruit comprising 98% water, little substance and little taste. 

This has of course changed over the years, but Mallorca is still faced with the giant-pumpkin conundrum. How does it add vastly more starch and sugar of a quality, up-market style while year after year still planting the seeds for massive-sized  production? How can it, when vertically integrated tour operators have to sell on volume to meet airline, airport and hotel obligations or when far too many hotels (which would need a miracle of investment) will remain for the high percentage of tourists who represent the water content or when too many jobs rely on the island's benevolence in providing a form of tourism social services for visitors whose actual contribution to the economy is otherwise negligible or often negative?

Croatia has grasped the promotional nettle because its government has taken the lead. In Mallorca the government does not lead. It trusts in the private sector to do its thinking and doing. President Bauzá said a year ago that his government had spent nothing on its tourism policy because it was in the hands of the private sector, which is all well and good, but while there is a giant pumpkin to be filled, the private sector of hotels and tour operators will do so in whichever way suits it, the result being, in the absence of clear leadership, strategy and web promotion, a fruit of a different variety - a lemon.

The Day Of The Low-Cost Hotel?

There is a fallacy that low-cost air travel equates to low-rent customers. It is a mistake made without an appreciation as to the way in which air travel has become essential and functional. It provides a function not only for the tourist but also for the business traveller and the second-residence owner. It is essential in that the horizons of mobility have stretched ever further into distances from home, and in having become functional and essential, low-cost air travel has become a commodity.

Air travel is a service which, because of a marketing ethos which has sought to stress differentiation, theoretically should never have undergone a process of commoditization. Nevertheless, for the short-haul traveller in particular, be he or she a regular or irregular flyer or be he or she low or high rent, the commodity of the flight (at as low a price as possible) is all that really matters.

Because of the fallacy of low-rent association, low cost means cheap, and cheap as a pejorative. Again, because of a failure to appreciate how air travel has undergone ifs commoditization process, it doesn't mean this. Low cost equals value for money. This may mean cheap in price terms but not otherwise.

Antagonism expressed towards the proliferation of low-cost flights coming into Palma (and it has been expressed) fails to take account of visitors' total spending behaviour. Sure, there are visitors who spend little, but there are plenty who are not tight. Save on flights and there is more cash for in-resort purchases.

Mallorca, thanks to the desires of government and some hoteliers as well as to legislation, is pushing itself ever more towards a higher-priced holiday. Upgrading hotel stock from the bog-standard three-star to at least four-star is an excuse for putting prices up, irrespective of whether the quality rises accordingly. The perceived wisdom is that, because tourist-consumers are nowadays that much more demanding and discerning, they expect four-star provision along with its accompanying spas and what have you and are also willing to pay for it. Yet curiously there is a trend which runs counter to this stellar augmentation. I say "curiously" but it isn't curious at all. The airline low-cost philosophy is catching on in the hospitality business as well.

The low-cost hotel has always been with us, though it hasn't always been called a hotel. It may also be a hostel. Whatever its name, there has been a marked increase in the provision of low-cost accommodation for urban tourism, i.e. that to major cities. One reason for this increase is the same as the demand for low-cost airlines - price and value for money - but there are others, such as a lack of investment credit over the past few years, which has caused hotel owners to focus on projects that are far more manageable financially. But crucially, the demand side, that of the traveller, is showing itself not to have totally bought in to what much of the Mallorcan hotel industry considers to be a need to up the star rating. 

It isn't the case that this traveller is low rent. While one has to be cautious and not be seduced by the generalisations of marketers and sociologists, the Millennial generation is said to largely eschew the trappings of the luxury or quasi-luxus hotel (typically one which is also now all-inclusive). This is a generation more in tune with the need for experiences as opposed to all-laid-on, all-inclusive exclusivity. In less grandiose terms there is also a whole tourism sector (one which is seemingly conveniently ignored by many in the Mallorcan industry) which craves nothing more than the cheap (value for money, aka low cost) and the cheerful (bright and modernised decor), embellished by added quality through that manageable financing. This is the style of the new low-cost hotel, one that combines being essential and functional in becoming a commodity product but with some important add-ons, namely personal service, facilities such as free wifi and an agility to market itself through social media in ways that large hotels seem less able to.

In Alcúdia an owner of two standard tourist apartment buildings/complexes has secured the SICTED quality certification for both. Investment has been put into both. Social media are used wisely, while there is also a highly effective relationship with the Palma-based Lowcostholidays. Both are booked solid right through the season. The profile of the customer (the word guest should never be used nowadays) will vary, but, and here is the good news, he or she goes out and spends. The onward march towards the hell of hotel hegemony in the form of the all-inclusive may just be encountering a low-cost obstacle in its path.

Why Low And Cost Are Not Dirty Words

Low cost is a dirty word in Mallorca. Two dirty words. Dirty because it implies cheap. And cheap is something Mallorca would rather not have. Cheap tourists.

Does anyone recall the former president of the Majorca Tourist Board placing the blame on low-cost airlines for the low-cost tourists coming from Britain? This was one example of the dirtiness of the low-cost word or term. He might not have meant it in quite the way it came out or was reported, but come out it did. Fan met brown stuff, albeit for a short time while those who recoiling in horror at being categorised as low cost asserted their high net worth.

Low cost is misunderstood. It is certainly misunderstood where airlines are concerned. Low cost may mean low-cost air tickets, but they can mean regular users of such tickets. Place a price incentive in front of someone, even someone with a bulging wallet and some platinum credit cards, and he or she will snap it up. Over and over again in the case of business travellers. Or only now and then in the case of others. The low cost matters as a means of transporting people. It doesn't follow that, once they have been transported, they display cheap tendencies. Quite the opposite can be the case. What you save on the swings through the air, you gain on the roundabouts of the destination terraces. You save, you gain. And they gain; they being businesses, such as Mallorca's restaurants.

There is an obvious problem with anything that is marketed as or named low cost. Well, two problems. One is that it might not meet with the aspirational style of the traveller. If so, that's the traveller's problem. Go high cost, if it bolsters your self-esteem. The other is that it is automatically seen as equating to cheap, which was just the mistake the ex-president of the tourist board made.

Mallorca has a good deal which is low cost. Some of it is cheap, in the sense that it brings with it a visitor class that does not have high disposable income. Is this wrong? Some would argue that it is. But wasn't tourism after the Second World War predicated on a belief that travel, and foreign travel in particular, didn't have to be for an elite? There is a potentially moral issue with the low-net-worth traveller, one of his exploiting Mallorca's resources and giving little or nothing back in return. But the other moral issue is whether a form of apartheid should exist, one that bars tourists simply on socioeconomic grounds or through some form of means testing.

Other examples of low cost in Mallorca are businesses which trade on the concept of low cost. You can't get much more obvious than Lowcostholidays. Now in a third year of a joint venture with EasyJet, the original low-cost provider for the contemporary travel market, its low cost is such that it has a major call and customer service centre in Palma. It was moved from India. And why was it moved? Because it was lower cost? I don't think so. It was moved in order to give improved service, and it is employing people in ever-increasing numbers. Moreover, its name doesn't have to mean cheap. In fact, it doesn't, when you consider that five-star accommodation can be booked. Ideally, its name would be Goodpriceholidays.

Then there is the accommodation which isn't five star. That which is well down the accommodation food chain, such as the hostels. These may be low cost, but it doesn't mean they are low standard. There is a trend towards quality improvement in hostels, and they are attracting more than a traditional backpacker, youth market. They are attracting families. And why shouldn't they? And why should there be any resistance to there being ever more hostels or lower-cost accommodation? Again, it simply doesn't follow that, because people opt for cheaper bedrooms, they don't have value. They most certainly do. And the more they save on accommodation, the more they have to spend.

Mallorca has got itself stuck into a way of thinking which sees four and five star as the ideal and everything else as catering for the idle classes with nary a euro to their name. And it suits parts of the island's tourism industry for such a mentality to prevail - the hoteliers. They may also offer lower-star accommodation but now they are gearing up to a minimum of four star in the belief that they will reap riches. They probably will. And they will gate their guests ever more behind walls of all-inclusivity. The hoteliers care little, or appear to care little, of what goes on beyond those walls. They did once. But not now.

Low cost may have become a pejorative. It may have become a catch-all for implying cheapness, but this is certainly not how it has to be or how it is. Affordable accommodation means spend elsewhere, but there are those in Mallorca's tourism industry who would rather that spend was not made elsewhere.


Any comments to andrew@thealcudiaguide.com please.