Pilar Carbonell is the director-general of Balearic tourism. She's the one who gets things done rather than talk about getting things done, which is minister Barceló's job. But she did talk recently. In a wide-ranging interview, she spoke about the tourist tax, all-inclusives, holiday lets, Aena and lower tariffs at the airport in winter. Hers is a wide brief.
I met her recently when she came to Alcudia to talk to local businesses who were wanting something done about all-inclusives. She seemed eminently charming. Highly attentive and respectful to what was being said at the meeting, there was nevertheless an impression that she was somewhat divorced from the day-to-day realities of life in the resorts. In a way this was surprising. She is steeped in the industry from the point of view of non-hotel businesses, having run restaurants and having been the president of the restaurants' association. In Alcudia, she seemed not to know of the sheer scale of the massive Bellevue complex and the enormous influence this has on the local tourism economy. She seemed surprised when told of the practice of wristbands being sold on the beach to tourists who can get day rates to drink as much as they want inside an all-inclusive.
Perhaps it's too much to ask that any politician with a tourism brief can be familiar with issues in each and every resort on the island, but if so, one wonders about what she said in this recent interview about the application of rules regarding holiday lets.
The law on this, or at least a process for deciding the regulation of accommodation, will be coming in some time in January, she intimated. And as part of this regulation, properties (apartments for the most part, therefore) will be subject to regulated and legal commercialisation as holiday accommodation in defined areas of resorts. The town halls, she said, would be the ones to decide on which areas.
This breaking down by area has already been given some discussion in Palma. But Palma is a big place. It has discernible areas, be they the old centre, the resort areas and other seaside parts which are less of a resort nature. Other resorts aren't anything like as big, and there is a clue in how they are referred to. They are resorts, full stop. Puerto Alcudia is, and this covers the port area and the main tourism centre a couple of kilometres away and stretches to the border with another resort - Playa de Muro: one continuous resort. There are various other such examples in Majorca.
Will this selection by town halls mean, for instance, that the "pueblos" are excluded? And if so, why? In Alcudia old town's case, as is the same with certain other old towns, it is part of the overall tourist offer in the municipality. Why should it not be included?
A concern may be that town halls end up being guided by the current land regulation known as POOT, which basically refers to a quota system of municipal territory dedicated to touristic development. But POOT doesn't presuppose a continuity of territory: it is broken up into parts. Hopefully, this will not be adopted as the guideline, but even under an alternative system, will the plan for town halls to decide not simply add to the confusion which exists regarding private accommodation for holiday let rather than lessen it? And what of municipalities not currently considered to be tourist centres, those in the interior? There is no current tourist development quota in most of them, while if they have ambitions to develop tourism - Sa Pobla is a case in point - they need flexibility where private properties are concerned because of an absence of hotels. Pilar Carbonell has her work cut out getting all this right.
Showing posts with label Private accommodation. Show all posts
Showing posts with label Private accommodation. Show all posts
Saturday, November 28, 2015
Saturday, September 05, 2015
Perfect Propaganda: Holiday lets
The recent horror story in the "Majorca Daily Bulletin" of sisters Emily and Daisy Wolton and their nightmare with a holiday apartment in Palma would make perfect propaganda for the Mallorcan hoteliers and the Exceltur alliance. Prime opponents of the private accommodation sector, the story had it all: no control of standard of accommodation; misleading representation; no comeback. It would also make perfect propaganda for others, including Aptur, the association which represents owners of private accommodation for tourist rental, and Biel Barceló, the minister of tourism. If none of these organisations or individuals have seen the article, they should all be sent a copy.
For the hoteliers and for Exceltur, it was confirmation of all that they have said about the poor quality of accommodation that is on the market, about an unregulated sector that does not abide by any rules, about properties which give Mallorca a bad name. One example it may be, but one example can often be sufficient to deter other visitors, once the information enters the public domain either through established media channels or social media. The Wolton sisters made the point that they have previously had good experiences with renting accommodation, but one bad experience can be enough to make regular visitors wonder about returning.
For Aptur, the case only harms its own objective, which is to obtain a system of regulation which is more permissive in allowing the proper commercialisation of tourist accommodation. It is as against poor standard properties as the hoteliers, even if it is coming at the issue from a different angle. For Barceló, it would be likely to add to his concerns about tourist saturation, the consequence not only of Mallorca having been this summer's refuge for visitors put off by events elsewhere. The saturation is not a product of the hotels with their finite number of places, it is one of a market which, while also finite, gives an impression of growing infinitely. Mallorca and the Balearics are said to have the most private properties for tourist rental of Spain's regions, with Palma the most popular specific destination. And this despite the law. (42% of all visitors to Spain who book apartments do so in Mallorca, according to research by the Esade business school.)
The Wolton sisters wondered who they could complain to. The tourism ministry would be the first port of call. But how do they denounce what has happened? With regulated establishments there are complaints' books and information as to how complaints can be registered. Unregulated, and there is none. A review on Trip Advisor can be a response, but where on Trip Advisor? And who would take any real notice? Users look at hotel reviews, but some individual apartment in Palma? And a review doesn't, in any event, undo the damage.
We know that Barceló is looking at changing the law in order to facilitate proper commercialisation rather than there being merely the loophole (often itself abused) of the tenancy act. But he is as alarmed as anyone at the flood of accommodation being made available and at the poor quality of some of it and so the harm it does to Mallorca's image. He wants regulation in place for next year's summer season, in which case he will have to get his skates on. Even with regulation in place, though, there will still be the non-regulated supply. Catalonia, which has a system of property standards and of registration, has found that this doesn't prevent a flouting of the law. But Barceló needs to act. The supply of accommodation is out of control.
For the hoteliers and for Exceltur, it was confirmation of all that they have said about the poor quality of accommodation that is on the market, about an unregulated sector that does not abide by any rules, about properties which give Mallorca a bad name. One example it may be, but one example can often be sufficient to deter other visitors, once the information enters the public domain either through established media channels or social media. The Wolton sisters made the point that they have previously had good experiences with renting accommodation, but one bad experience can be enough to make regular visitors wonder about returning.
For Aptur, the case only harms its own objective, which is to obtain a system of regulation which is more permissive in allowing the proper commercialisation of tourist accommodation. It is as against poor standard properties as the hoteliers, even if it is coming at the issue from a different angle. For Barceló, it would be likely to add to his concerns about tourist saturation, the consequence not only of Mallorca having been this summer's refuge for visitors put off by events elsewhere. The saturation is not a product of the hotels with their finite number of places, it is one of a market which, while also finite, gives an impression of growing infinitely. Mallorca and the Balearics are said to have the most private properties for tourist rental of Spain's regions, with Palma the most popular specific destination. And this despite the law. (42% of all visitors to Spain who book apartments do so in Mallorca, according to research by the Esade business school.)
The Wolton sisters wondered who they could complain to. The tourism ministry would be the first port of call. But how do they denounce what has happened? With regulated establishments there are complaints' books and information as to how complaints can be registered. Unregulated, and there is none. A review on Trip Advisor can be a response, but where on Trip Advisor? And who would take any real notice? Users look at hotel reviews, but some individual apartment in Palma? And a review doesn't, in any event, undo the damage.
We know that Barceló is looking at changing the law in order to facilitate proper commercialisation rather than there being merely the loophole (often itself abused) of the tenancy act. But he is as alarmed as anyone at the flood of accommodation being made available and at the poor quality of some of it and so the harm it does to Mallorca's image. He wants regulation in place for next year's summer season, in which case he will have to get his skates on. Even with regulation in place, though, there will still be the non-regulated supply. Catalonia, which has a system of property standards and of registration, has found that this doesn't prevent a flouting of the law. But Barceló needs to act. The supply of accommodation is out of control.
Monday, April 20, 2015
The "New" New Tourism Law
The past three years I have spent time - above and beyond the call of duty - trawling through pages upon pages of Balearic tourism legislation. It had seemed, in June 2012, that further time would be unnecessary, but no. Remarkable though it is, the law of 2012 was not the finished article. How strange the legislative process is here that three years later, this very law can be presented as the "new" law, though there is in fact quite a bit that is new and that has been added.
These differences have chiefly been integrated in the pursuit of "consensus", one that tourism minister Jaime Martínez says has been achieved. He is right up to a point in that even those sectors of the tourism industry which might still have disagreements with him have put them to one side in displaying a show of unity for the Partido Popular; they have all broken out in a cold sweat at the very mention of Podemos or a pact of the left.
We will find out how real this consensus is, but in the meantime we have to come to terms with what is the definitive tourism law document, signed by President Bauzá and minister Martínez and posted on the Official Bulletin on 17 April. For media and PR purposes, a highlight of this "new" new law is the provision for dealing with party boats, a matter - in the scheme of things - of relative inconsequence. But it is one that makes for a good headline and is far less dull than, for example, all the appendices showing the sizes and colours of establishment classification.
While there will doubtless be those who consider party boats to be of utmost importance, my principal interests - as they have been over these three years - concern private holiday accommodation, all-inclusives and resort development. True to form, private apartments remain excluded from regulation and so "illegal" unless they are rented out under the tenancy act. Terraced houses, i.e. ones with houses to both sides, which had also been excluded, are no longer. Otherwise, it is as you were.
When the law was introduced (sort of) in 2012, hotels were to be required to come up with quality plans. It was these which appeared to form the basis of possibly tighter regulation of all-inclusives, and the new version of the law does give some detail as to how these plans are to be submitted. However, they apply to all hotels and not just those which offer all-inclusive and they require self-evaluation, which would then be subject to verification from inspection. But crucially, there is nothing specific to the all-inclusive offer in this; it is a quality system geared towards star categorisation.
What the law does include is a requirement for all hotels to register their offer of "pensión completa integral" - which means all-inclusive - be this offer optional or unique. It also demands that this offer is explained in publicity material. But then, many hotels already do this. As for registering all-inclusive offer, what is the purpose of this information? If it is for quality purposes, then star categorisation is not how this has to be ensured. All-inclusives, the large, cheaper ones, offer regimes of service and room quality and overcrowding that need to be dealt with, and the star system only partially addresses these. Will inspection lead to improvements? This would be very doubtful. A recent report showed that the tourism inspectors - twenty of them in all - spend mostly all their time on illegal apartments and bars and restaurants.
Martínez proudly says that the law now regulates all-inclusives' quality plans, but this, one fancies, is a statement for political (and electoral) purposes. Study the law closely, and this is not the impression one gets. He also says that the level of all-inclusive is decreasing. Is it really? If so, where? Moreover, how can he possibly say that it is if the all-inclusive offer hasn't previously been registered? He's talking nonsense.
On resort development, there is a good deal about "intervention" in touristic areas and declarations of "touristic interest" which amount to what has already been put in place for facilitating improvements in so-called "mature (outdated/obsolete) zones", e.g. Playa de Palma. But establishing these principles in law doesn't mean that they are acted upon in practice. Some time soon, I am due to meet President Bauzá, and one of the preliminary questions I have sent him has to do with the very subject of resort regeneration, of which, apart from Playa de Palma and Magalluf, there is very little. On becoming president, he said that this regeneration could not be delayed. Yet his government has spent virtually nothing on it. And why hasn't it? Because it talks about the necessity but leaves it to others, thus showing no strategic and financing leadership.
These differences have chiefly been integrated in the pursuit of "consensus", one that tourism minister Jaime Martínez says has been achieved. He is right up to a point in that even those sectors of the tourism industry which might still have disagreements with him have put them to one side in displaying a show of unity for the Partido Popular; they have all broken out in a cold sweat at the very mention of Podemos or a pact of the left.
We will find out how real this consensus is, but in the meantime we have to come to terms with what is the definitive tourism law document, signed by President Bauzá and minister Martínez and posted on the Official Bulletin on 17 April. For media and PR purposes, a highlight of this "new" new law is the provision for dealing with party boats, a matter - in the scheme of things - of relative inconsequence. But it is one that makes for a good headline and is far less dull than, for example, all the appendices showing the sizes and colours of establishment classification.
While there will doubtless be those who consider party boats to be of utmost importance, my principal interests - as they have been over these three years - concern private holiday accommodation, all-inclusives and resort development. True to form, private apartments remain excluded from regulation and so "illegal" unless they are rented out under the tenancy act. Terraced houses, i.e. ones with houses to both sides, which had also been excluded, are no longer. Otherwise, it is as you were.
When the law was introduced (sort of) in 2012, hotels were to be required to come up with quality plans. It was these which appeared to form the basis of possibly tighter regulation of all-inclusives, and the new version of the law does give some detail as to how these plans are to be submitted. However, they apply to all hotels and not just those which offer all-inclusive and they require self-evaluation, which would then be subject to verification from inspection. But crucially, there is nothing specific to the all-inclusive offer in this; it is a quality system geared towards star categorisation.
What the law does include is a requirement for all hotels to register their offer of "pensión completa integral" - which means all-inclusive - be this offer optional or unique. It also demands that this offer is explained in publicity material. But then, many hotels already do this. As for registering all-inclusive offer, what is the purpose of this information? If it is for quality purposes, then star categorisation is not how this has to be ensured. All-inclusives, the large, cheaper ones, offer regimes of service and room quality and overcrowding that need to be dealt with, and the star system only partially addresses these. Will inspection lead to improvements? This would be very doubtful. A recent report showed that the tourism inspectors - twenty of them in all - spend mostly all their time on illegal apartments and bars and restaurants.
Martínez proudly says that the law now regulates all-inclusives' quality plans, but this, one fancies, is a statement for political (and electoral) purposes. Study the law closely, and this is not the impression one gets. He also says that the level of all-inclusive is decreasing. Is it really? If so, where? Moreover, how can he possibly say that it is if the all-inclusive offer hasn't previously been registered? He's talking nonsense.
On resort development, there is a good deal about "intervention" in touristic areas and declarations of "touristic interest" which amount to what has already been put in place for facilitating improvements in so-called "mature (outdated/obsolete) zones", e.g. Playa de Palma. But establishing these principles in law doesn't mean that they are acted upon in practice. Some time soon, I am due to meet President Bauzá, and one of the preliminary questions I have sent him has to do with the very subject of resort regeneration, of which, apart from Playa de Palma and Magalluf, there is very little. On becoming president, he said that this regeneration could not be delayed. Yet his government has spent virtually nothing on it. And why hasn't it? Because it talks about the necessity but leaves it to others, thus showing no strategic and financing leadership.
Tuesday, March 10, 2015
Defending Loyalty To Mallorca
April Rinne is a name that probably won't mean anything to you. She is the chief strategy officer for something called Collaborative Lab, "the leading source of expertise for companies and governments that want to embrace the collaborative economy". Among other things, she is a "young global leader" at the World Economic Forum and has been an adviser to the Bill and Melinda Gates Foundation. She has, says her biog, "illustrated her thought leadership" in various publications. Thought leadership? What on earth is that?
Depending on your perspective, Rinne is either one of those infuriating Americans who come along on a regular basis and appear to invent entire alternative universes of business and marketing replete with jargonese and gurudom or a crystal-clear visionary of a brave new future world. Whatever your perspective, these are universes or worlds remote from the man or woman booking holidays to Mallorca. They appear divorced from everyday realities but sometimes they can be important, and what April Rinne deals in is important.
The notion of the collaborative or sharing economy is simple enough. You have something to share - let's say it's an apartment that you own - and someone wants to take up your offer. This is an economy that has always been with us, but technology has vastly expanded its potential, so much so that - at its most extreme -what you might have to share can be shared with anyone from anywhere. Middlemen cease to exist. All that is needed is a facilitator, a third party which enables the sharer to be in touch with his or her potential market. This is the world of P2P, peer to peer or people to people. This is the world of Airbnb property sharing, Uber car sharing and many others.
Rinne has made an observation which sums up the rise of P2P. It has taken Airbnb, the world's leading internet portal for tourist property rental, just six years to reach a level of users (customers) that Hilton needed over 90 years to attain. It is a stark observation of the battle between hotels and private accommodation that is going on across the globe and so not just in Mallorca, and it is a battle which, despite moves to legislate, appears to be one that the hotels cannot win. Rinne believes that the onslaught from the likes of Airbnb has only just begun.
Confronted with this competition - typically decried by the hoteliers as "unfair" - how can hotels fight back? A clue as to how they can lies with understanding the appeal of P2P and the apparent shifts in consumer thinking and behaviour, in particular those of the so-called Millennial generation. Tourism, according to accepted P2P wisdom, is about personalisation, about "experiences", about contact with local people in destinations. It is the depersonalised nature of hotels which turns the traveller on to a P2P "experience" and which also deters those Millennials who supposedly are also interested principally in experiences.
Of course, much of this sounds and often is marketing gobbledegook, but there is nevertheless a good deal of truth about depersonalisation and especially that which comes with the package holiday. This said, hotels have woken up to the need for greater personalisation and also to the need for "experiences". Many can't help telling potential clients about the experiences that await them or shoehorning them in to brand sloganising. And it is this branding which holds the key for hotels and, more importantly, tour operators.
Experiences and personalisation have become the hotelier and tour operator zeitgeist as has the need for branding and so brand loyalty, but in emphasising the brand, tour operators and indeed some hotel chains shift the focus away from the destination. What is being sold, therefore, is the brand, and where it is located is secondary. A consequence is that loyalty to the destination, be it Mallorca, its individual resorts is potentially loosened. And experiences and personalisation for the P2P traveller can also undermine specific destinations. These travellers place a premium on the social-media aspect of sharing information and recommendations. If they are for somewhere other than Mallorca, then so be it.
The importance of these trends can be over-exaggerated. The traditional package holiday, for instance, and despite repeated reports of its death, is not about to disappear any time soon. But they are trends which cannot be ignored and so make it imperative that Mallorca acts to confirm and reinforce tourist loyalty to it.
There was a statement the other day that the "summer sells itself". Well yes, it does, but to believe, against the background of these trends, that "selling" is not required is wrongheaded. It is needed as never before, and so Mallorca needs its own assault, one it is currently failing to deliver, that of loyalty building through social media. And, moreover, it is an assault that needs to embrace, not deny, the P2P revolution.
Depending on your perspective, Rinne is either one of those infuriating Americans who come along on a regular basis and appear to invent entire alternative universes of business and marketing replete with jargonese and gurudom or a crystal-clear visionary of a brave new future world. Whatever your perspective, these are universes or worlds remote from the man or woman booking holidays to Mallorca. They appear divorced from everyday realities but sometimes they can be important, and what April Rinne deals in is important.
The notion of the collaborative or sharing economy is simple enough. You have something to share - let's say it's an apartment that you own - and someone wants to take up your offer. This is an economy that has always been with us, but technology has vastly expanded its potential, so much so that - at its most extreme -what you might have to share can be shared with anyone from anywhere. Middlemen cease to exist. All that is needed is a facilitator, a third party which enables the sharer to be in touch with his or her potential market. This is the world of P2P, peer to peer or people to people. This is the world of Airbnb property sharing, Uber car sharing and many others.
Rinne has made an observation which sums up the rise of P2P. It has taken Airbnb, the world's leading internet portal for tourist property rental, just six years to reach a level of users (customers) that Hilton needed over 90 years to attain. It is a stark observation of the battle between hotels and private accommodation that is going on across the globe and so not just in Mallorca, and it is a battle which, despite moves to legislate, appears to be one that the hotels cannot win. Rinne believes that the onslaught from the likes of Airbnb has only just begun.
Confronted with this competition - typically decried by the hoteliers as "unfair" - how can hotels fight back? A clue as to how they can lies with understanding the appeal of P2P and the apparent shifts in consumer thinking and behaviour, in particular those of the so-called Millennial generation. Tourism, according to accepted P2P wisdom, is about personalisation, about "experiences", about contact with local people in destinations. It is the depersonalised nature of hotels which turns the traveller on to a P2P "experience" and which also deters those Millennials who supposedly are also interested principally in experiences.
Of course, much of this sounds and often is marketing gobbledegook, but there is nevertheless a good deal of truth about depersonalisation and especially that which comes with the package holiday. This said, hotels have woken up to the need for greater personalisation and also to the need for "experiences". Many can't help telling potential clients about the experiences that await them or shoehorning them in to brand sloganising. And it is this branding which holds the key for hotels and, more importantly, tour operators.
Experiences and personalisation have become the hotelier and tour operator zeitgeist as has the need for branding and so brand loyalty, but in emphasising the brand, tour operators and indeed some hotel chains shift the focus away from the destination. What is being sold, therefore, is the brand, and where it is located is secondary. A consequence is that loyalty to the destination, be it Mallorca, its individual resorts is potentially loosened. And experiences and personalisation for the P2P traveller can also undermine specific destinations. These travellers place a premium on the social-media aspect of sharing information and recommendations. If they are for somewhere other than Mallorca, then so be it.
The importance of these trends can be over-exaggerated. The traditional package holiday, for instance, and despite repeated reports of its death, is not about to disappear any time soon. But they are trends which cannot be ignored and so make it imperative that Mallorca acts to confirm and reinforce tourist loyalty to it.
There was a statement the other day that the "summer sells itself". Well yes, it does, but to believe, against the background of these trends, that "selling" is not required is wrongheaded. It is needed as never before, and so Mallorca needs its own assault, one it is currently failing to deliver, that of loyalty building through social media. And, moreover, it is an assault that needs to embrace, not deny, the P2P revolution.
Sunday, January 11, 2015
The Wrong Type Of Tourism Regulation
There was a time, and it wasn't so long ago, that the local Spanish media made very little noise about the issue of private holiday accommodation. The tendency was to go along with how the regional government and the hoteliers portrayed the issue, namely that there was an underground economy that was operating a form of unfair competition (to the hoteliers). The narrative ignored the fact that this underground economy was the product of legislative proscription. Prohibition has often led to ways which circumvent it.
The attitude of the local media changed when the national government declined to take responsibility for private holiday accommodation and shoved it down the line to the regions. In practice, where the Balearics were concerned, the tenancy act reform meant very little. The status quo was maintained. Yet, the media had finally been alerted to an issue that had been rumbling for years. It started to adopt a more critical posture and it was joined by politicians from PSOE, a party which had hitherto managed to steadfastly ignore the issue.
Last Wednesday, the Diario de Mallorca devoted its front-page headline and its first two inside pages to a story which started thus: "Mallorca is playing with fire". The fire is that of prohibition, one that is said to be driving tourists away from Mallorca and to other destinations and one that will continue to do so. The sources of information for this claim, primarily representatives of accommodation web portals, do of course have their own business agendas and interests to safeguard, but nonetheless here was an overt statement that was highly critical of the government's posture. "Persecution" was one word used to describe it. The difference in attitude to that in Catalonia and elsewhere in Spain, where there have been or are moves to create a properly regulated system of private accommodation, was revealed starkly.
Mallorca has had a history of not appreciating tourism trends. Low-cost airline carriers were once considered a threat, so attempts were made to kill them off. The misunderstanding as to what low cost actually represented was still being perpetrated only three or so years ago by someone who should have known better: the then president of the Fomento (the Mallorca Tourist Board). Low cost equalled low quality. It was wrongheaded but was in keeping with a malaise that continues to dog Mallorca. The island cannot or is unwilling to adapt to tourism changes, and these changes are ever more rapid than they once were.
The P2P sharing culture is the latest of these changes and one of the most potent. It attacks the complacent notion of hotel domination and a misguided belief that Mallorca should exist for the benefit of its hoteliers and no one else. At a time when the regional government can bask in the warmth from the glow of new or redeveloped hotel complexes, straining extra stars inside their walls and grounds, it does not accept that there is a different glow, that of the fire it is playing with (according to the report this week).
Fundamentally, the government demonstrates an unwillingness or incapacity of intellect to appreciate just how much travel and tourism are changing. Driven by technological applications, there is a societal shift towards the tourist as user, and it is he or she who dominates and not, therefore, the hotelier tourism god. Holidaymakers will not turn their backs on hotels totally or anything like totally. There will always be very high demand, especially as quality increases. But this isn't the point. The tourist-user is not beholden to a conventional model of tourism, as it has been applied in Mallorca. There is a vast market which is proving that this is the case, and it is one to which Mallorca has to adapt and so introduce comprehensible, fair and flexible regulations in order to feature in this new tourism world. Is Mallorca up to the challenge? Until it finds those with the intellect, the understanding of technological advances and constantly shifting consumer values and the capacity to not say boo to the hoteliers but to embrace them in establishing a co-ordinated model that benefits different parties, then no. But change might be on the way. Let's see what happens in May.
The attitude of the local media changed when the national government declined to take responsibility for private holiday accommodation and shoved it down the line to the regions. In practice, where the Balearics were concerned, the tenancy act reform meant very little. The status quo was maintained. Yet, the media had finally been alerted to an issue that had been rumbling for years. It started to adopt a more critical posture and it was joined by politicians from PSOE, a party which had hitherto managed to steadfastly ignore the issue.
Last Wednesday, the Diario de Mallorca devoted its front-page headline and its first two inside pages to a story which started thus: "Mallorca is playing with fire". The fire is that of prohibition, one that is said to be driving tourists away from Mallorca and to other destinations and one that will continue to do so. The sources of information for this claim, primarily representatives of accommodation web portals, do of course have their own business agendas and interests to safeguard, but nonetheless here was an overt statement that was highly critical of the government's posture. "Persecution" was one word used to describe it. The difference in attitude to that in Catalonia and elsewhere in Spain, where there have been or are moves to create a properly regulated system of private accommodation, was revealed starkly.
Mallorca has had a history of not appreciating tourism trends. Low-cost airline carriers were once considered a threat, so attempts were made to kill them off. The misunderstanding as to what low cost actually represented was still being perpetrated only three or so years ago by someone who should have known better: the then president of the Fomento (the Mallorca Tourist Board). Low cost equalled low quality. It was wrongheaded but was in keeping with a malaise that continues to dog Mallorca. The island cannot or is unwilling to adapt to tourism changes, and these changes are ever more rapid than they once were.
The P2P sharing culture is the latest of these changes and one of the most potent. It attacks the complacent notion of hotel domination and a misguided belief that Mallorca should exist for the benefit of its hoteliers and no one else. At a time when the regional government can bask in the warmth from the glow of new or redeveloped hotel complexes, straining extra stars inside their walls and grounds, it does not accept that there is a different glow, that of the fire it is playing with (according to the report this week).
Fundamentally, the government demonstrates an unwillingness or incapacity of intellect to appreciate just how much travel and tourism are changing. Driven by technological applications, there is a societal shift towards the tourist as user, and it is he or she who dominates and not, therefore, the hotelier tourism god. Holidaymakers will not turn their backs on hotels totally or anything like totally. There will always be very high demand, especially as quality increases. But this isn't the point. The tourist-user is not beholden to a conventional model of tourism, as it has been applied in Mallorca. There is a vast market which is proving that this is the case, and it is one to which Mallorca has to adapt and so introduce comprehensible, fair and flexible regulations in order to feature in this new tourism world. Is Mallorca up to the challenge? Until it finds those with the intellect, the understanding of technological advances and constantly shifting consumer values and the capacity to not say boo to the hoteliers but to embrace them in establishing a co-ordinated model that benefits different parties, then no. But change might be on the way. Let's see what happens in May.
Thursday, July 24, 2014
The Illogic Of Mallorca's Tourism
There are two organisations in Mallorca which above all others deserve being listened to when it comes to tourism issues. Neither may be totally independent - (which organisation can be?) - but each does its best in being objective. The organisations are the Chamber of Commerce and the Universitat de les Illes Balears. They strive for objectivity, and one reason why they generally succeed in doing so is because they both undertake their own research.
Antoni Riera, professor of applied economics at the university, has been making some observations about the nature of Mallorca's tourism, drawing on a study that was undertaken last summer. The findings will come as no surprise, but they will be findings which, in certain respects, will be ignored. A key one has to do with private accommodation tourism, aka holiday lets. Tourists who rent accommodation spend on average 30% more than tourists who stay in hotels. This is spend which is necessary. It is what keeps a great number of the almost 50,000 tourist-related businesses (the complementary sector and tourism services) going.
Who will be doing the ignoring? Those who are not objective; the regional government being among them. The hoteliers will also want to ignore the findings except to point out that this rental market is partly illegal and unfair competition. It is unfair in different ways, one being that the accommodation is generally cheaper. And so it may well be. But that is the reason why those doing the renting can spend 30% more than the hotel-based tourist.
This 30% figure is striking not just in that it shows a much higher level of spending. It is also very similar to the figure for the total spend by tourists in Mallorca that ends up with the complementary sector. That figure is 29%. Where does the rest go? On hotel accommodation and price of the holiday package.
It needs to be noted that the hotel part of the equation includes all type of board and so not only all-inclusive, but all-inclusive has exacerbated the situation and quite dramatically so. Economic crisis brought about a significant increase in the level of AI. The consequence has been that, although Mallorca has registered record numbers of tourists in the past couple of years and has in fact registered record levels of turnover, the level of spend has declined and is continuing to decline. All-inclusives have seen to this and will continue to see to this.
As I say, none of this will come as a surprise. Indeed, none of it is new. But it sometimes needs organisations with real credibility to try and get the message across. The trouble is that they are consistently ignored, as was the Chamber of Commerce when it issued a report in 2006. This looked at the level of private accommodation holiday rental. One of the report's conclusions was that spending behaviour between hotel and rental tourists represented two distinct profiles. The former spent less than the latter. Another conclusion was that rental tourism lengthened the tourism season (the hoteliers have consistently said that it doesn't). A further conclusion was that a "more stable" tourist resort required a capacity for rental tourism.
We were given grand figures this week for the economic contribution of all-inclusives. 2.5 billion euros. At least there was an admission that the lion's share of this comprised the cost of hotel accommodation and the package. I've been seemingly banging my head against a brick wall for years trying to explain that spend statistics primarily consist of these costs. Just as others, like the Chamber of Commerce and the university, have been trying to explain that there is a vast tourism population which contributes negligible amounts to the local economy and that there is a significant tourism population which stays in rental accommodation which contributes a great deal to the local, non-hotel economy. If there was any logic to Mallorca's tourism, you would think that someone in government might reflect on the model of the island's tourism and conclude that the all-eggs-in-the-hotel-basket model is not necessarily the best model.
But then, when did logic have anything to do with anything? If it did, then the government would accept that there are distinct profiles of tourist, as the Chamber of Commerce noted in 2006, and as Professor Riera has reiterated this past week. One profile being that which makes a telling contribution to the general economy and another one which doesn't.
Antoni Riera, professor of applied economics at the university, has been making some observations about the nature of Mallorca's tourism, drawing on a study that was undertaken last summer. The findings will come as no surprise, but they will be findings which, in certain respects, will be ignored. A key one has to do with private accommodation tourism, aka holiday lets. Tourists who rent accommodation spend on average 30% more than tourists who stay in hotels. This is spend which is necessary. It is what keeps a great number of the almost 50,000 tourist-related businesses (the complementary sector and tourism services) going.
Who will be doing the ignoring? Those who are not objective; the regional government being among them. The hoteliers will also want to ignore the findings except to point out that this rental market is partly illegal and unfair competition. It is unfair in different ways, one being that the accommodation is generally cheaper. And so it may well be. But that is the reason why those doing the renting can spend 30% more than the hotel-based tourist.
This 30% figure is striking not just in that it shows a much higher level of spending. It is also very similar to the figure for the total spend by tourists in Mallorca that ends up with the complementary sector. That figure is 29%. Where does the rest go? On hotel accommodation and price of the holiday package.
It needs to be noted that the hotel part of the equation includes all type of board and so not only all-inclusive, but all-inclusive has exacerbated the situation and quite dramatically so. Economic crisis brought about a significant increase in the level of AI. The consequence has been that, although Mallorca has registered record numbers of tourists in the past couple of years and has in fact registered record levels of turnover, the level of spend has declined and is continuing to decline. All-inclusives have seen to this and will continue to see to this.
As I say, none of this will come as a surprise. Indeed, none of it is new. But it sometimes needs organisations with real credibility to try and get the message across. The trouble is that they are consistently ignored, as was the Chamber of Commerce when it issued a report in 2006. This looked at the level of private accommodation holiday rental. One of the report's conclusions was that spending behaviour between hotel and rental tourists represented two distinct profiles. The former spent less than the latter. Another conclusion was that rental tourism lengthened the tourism season (the hoteliers have consistently said that it doesn't). A further conclusion was that a "more stable" tourist resort required a capacity for rental tourism.
We were given grand figures this week for the economic contribution of all-inclusives. 2.5 billion euros. At least there was an admission that the lion's share of this comprised the cost of hotel accommodation and the package. I've been seemingly banging my head against a brick wall for years trying to explain that spend statistics primarily consist of these costs. Just as others, like the Chamber of Commerce and the university, have been trying to explain that there is a vast tourism population which contributes negligible amounts to the local economy and that there is a significant tourism population which stays in rental accommodation which contributes a great deal to the local, non-hotel economy. If there was any logic to Mallorca's tourism, you would think that someone in government might reflect on the model of the island's tourism and conclude that the all-eggs-in-the-hotel-basket model is not necessarily the best model.
But then, when did logic have anything to do with anything? If it did, then the government would accept that there are distinct profiles of tourist, as the Chamber of Commerce noted in 2006, and as Professor Riera has reiterated this past week. One profile being that which makes a telling contribution to the general economy and another one which doesn't.
Friday, July 04, 2014
The Holiday Let Takeover In Mallorca
One headline this week has announced that "for the first time the majority of tourists in Mallorca are staying in non-hotel accommodation". The news that Son Sant Joan has been beating records in terms of passenger numbers since May and is likely to continue beating them during the summer has led to the conclusion that these passenger numbers are the result of tourists staying in non-hotel accommodation. The numbers don't tally with hotel occupancy numbers.
Well, whoever would have thought it? Why has Son Sant Joan been getting the passenger numbers it has until now? Not just because of hotels, that's for sure. If there is indeed now a majority of tourists staying in non-hotel accommodation, then this should come as absolutely no surprise. Mallorca cannot possibly have the number of tourists it gets and put them all in hotels because, despite the high number of hotel places (some 280,000), it is impossible for hotels to get anywhere near meeting tourist demand. It's been said time and time again that this is the case.
Nevertheless, in the quieter months of the summer season such as May, visitors could, in theory, all be accommodated in hotels. That they are not should not be a reason for government and hoteliers to attack the non-hotel accommodation sector (included in which is the so-called illegal offer). It should be a reason for asking why this is so. And there are several reasons. Choice, price, quality in some instances, and of course supply, both legal and illegal.
The passenger numbers will, as ever, be used by the Mallorcan hoteliers federation to ratchet up its attack on the non-hotel sector. They will be used by the government to justify more inspections of properties. It says there have been 3,000 such inspections since January. Aware of the need of the political support of the hoteliers, it will do whatever it can to try and demonstrate that it is acting tough.
But the government, and it knows it, cannot and will not eliminate illegal supply. As the level of non-hotel accommodation is as high as it apparently is, then the pragmatic route - one which the government steadfastly rejects - should be the one it adopts. Permissive regulation, therefore.
Catalonia, with its permissive regime, still faces a sizable problem with illegal accommodation. But having taken the decision to permit registration of the hundreds, thousands of properties that it has, it has also taken a very strict approach on accommodation which contravenes its regulation. So, it is permissive but also restrictive in an appropriate way. It has opened up the market to private property owners but it isn't about to tolerate the ingratitude of those owners who do not play by its perfectly reasonable rules. Unlike the Balearics, where tourism minister Martinez talks tough but where he presents little evidence as to what the consequence of the 3,000 inspections has been, in Catalonia it has processed under a half of the 284 actions it has so far taken against illegal properties. Till now it has realised a total of over half a million euros in fines.
Well, whoever would have thought it? Why has Son Sant Joan been getting the passenger numbers it has until now? Not just because of hotels, that's for sure. If there is indeed now a majority of tourists staying in non-hotel accommodation, then this should come as absolutely no surprise. Mallorca cannot possibly have the number of tourists it gets and put them all in hotels because, despite the high number of hotel places (some 280,000), it is impossible for hotels to get anywhere near meeting tourist demand. It's been said time and time again that this is the case.
Nevertheless, in the quieter months of the summer season such as May, visitors could, in theory, all be accommodated in hotels. That they are not should not be a reason for government and hoteliers to attack the non-hotel accommodation sector (included in which is the so-called illegal offer). It should be a reason for asking why this is so. And there are several reasons. Choice, price, quality in some instances, and of course supply, both legal and illegal.
The passenger numbers will, as ever, be used by the Mallorcan hoteliers federation to ratchet up its attack on the non-hotel sector. They will be used by the government to justify more inspections of properties. It says there have been 3,000 such inspections since January. Aware of the need of the political support of the hoteliers, it will do whatever it can to try and demonstrate that it is acting tough.
But the government, and it knows it, cannot and will not eliminate illegal supply. As the level of non-hotel accommodation is as high as it apparently is, then the pragmatic route - one which the government steadfastly rejects - should be the one it adopts. Permissive regulation, therefore.
Catalonia, with its permissive regime, still faces a sizable problem with illegal accommodation. But having taken the decision to permit registration of the hundreds, thousands of properties that it has, it has also taken a very strict approach on accommodation which contravenes its regulation. So, it is permissive but also restrictive in an appropriate way. It has opened up the market to private property owners but it isn't about to tolerate the ingratitude of those owners who do not play by its perfectly reasonable rules. Unlike the Balearics, where tourism minister Martinez talks tough but where he presents little evidence as to what the consequence of the 3,000 inspections has been, in Catalonia it has processed under a half of the 284 actions it has so far taken against illegal properties. Till now it has realised a total of over half a million euros in fines.
Friday, September 18, 2009
Protection
Back to the letters page in "The Bulletin". I thoroughly commend the letter about holiday rentals that appeared yesterday.
Here is an area, holiday rentals, that tells you much of what you need to know about how officialdom works or rather doesn't work. It is an area of confusion, lack of clarity, massive doses of self-interest and arguably protectionism and anti-competitiveness. That's a pretty damning charge sheet.
The letter-writer draws attention to information from the regional government tourism ministry, which, he says, states that an apartment may be rented out without any licence so long as it is not marketed as a holiday apartment. He also draws attention, news to me I must say, that holiday accommodation cannot be marketed by local estate agents. In other words, all those agencies which are doing so, and their number is vast, are breaking the law. You can add in the confusion surrounding the rent of other property, whether villa, finca, house; add in whether apartments in a block must all be on the same basis and have a reception area; add in the fact that licences for finca rental cannot now be obtained. Add in all this lot, and you have the most God awful mess.
Holiday rentals are an important part of the tourism mix. They are important for the very simple reason that not everyone wants to stay in a hotel. But herein lies the rub. The government and of course the hoteliers want everyone to stay in a hotel. They are misguided, narrow-minded and wrong. The hotels exert enormous influence both economically and politically in Mallorca - and justifiably so. Tourism growth was largely the consequence of investment in hotel stock. Many hotel chains and hotels rank as excellent. Mallorca's leading hotel chains are international players, while locally they appear at the top of the list of the island's wealth-generating businesses. They have a right to preserve what they have created, but not at the expense of a mixed tourism market. The hotel lobby, though, has been the strongest voice in seeking government curbs on the holiday-rental market. It is the hotels' self-interest which has led to much of the current confusion as legislation, communicated unclearly and implemented haphazardly by local and regional government agencies not clear themselves as to the legislation, has been heaped upon the wider tourism market in an attempt at gaining market protection. There is more than just a hint of discrimination as well. Many apartments and other holiday-rental accommodation are foreign owned.
Notwithstanding regulation that seeks to ensure that taxes are paid and that safety and quality standards are adhered to (and such regulation is to be applauded), much of the rest is a nonsense. Just go back to that bit about not marketing a flat as a holiday apartment. This is the tourism ministry saying so. What else is tourism but holidays? This is ridiculous.
The holiday-rental morass is indicative of a wider malaise, one of legal obfuscation and sometimes protectionism by the backdoor. One only has to consider the lunatic situation regarding bar closing times to appreciate how such obfuscation can be played out. Calvia town hall closed bars at 11, interpreting a new law which classified "evening" as ending at 11. The relevant ministry, environment, told them not to. What was the point of the new classification in that case? Take another example - driving licences. How many residents are clear what the rules are? Or another, that in respect of boat charters and the enormous fines being levied. Where's the fairness?
Democracies operate on the basis of fair, just and transparent legal systems, but one cannot avoid a conclusion that not all is right with the operation of local legal systems and their subsequent implementation down the chain of governmental levels, unclear as to what they mean. Too much seems to be made up on the hoof, superimposed on previous legislation and then left open to all sorts of interpretation. And the holiday-rentals market is a classic example.
All too often the response to such situations is a shrug and an "oh, well, that's Spain". It doesn't wash any longer, especially where an important part of the tourism market - and a revenue-generator for governments - is concerned. It should all be very simple. You have some accommodation and wish to rent it out. Fair enough, obtain the relevant licence, meet the relevant standards and pay your taxes. Simple. But not. Because, for example, the process to obtain the licence in the first place would fall down the great black hole of local bureaucracy. And because also there is a powerful group that will do what it can to stop you.
They need to get it sorted, but they won't.
QUIZ
Yesterday's title - The Four Seasons, "December 63", http://www.youtube.com/watch?v=TQO9LNELIKQ. Today's title - brilliant; who?
(PLEASE REPLY TO andrew@thealcudiaguide.com AND NOT VIA THE COMMENTS THINGY HERE.)
Here is an area, holiday rentals, that tells you much of what you need to know about how officialdom works or rather doesn't work. It is an area of confusion, lack of clarity, massive doses of self-interest and arguably protectionism and anti-competitiveness. That's a pretty damning charge sheet.
The letter-writer draws attention to information from the regional government tourism ministry, which, he says, states that an apartment may be rented out without any licence so long as it is not marketed as a holiday apartment. He also draws attention, news to me I must say, that holiday accommodation cannot be marketed by local estate agents. In other words, all those agencies which are doing so, and their number is vast, are breaking the law. You can add in the confusion surrounding the rent of other property, whether villa, finca, house; add in whether apartments in a block must all be on the same basis and have a reception area; add in the fact that licences for finca rental cannot now be obtained. Add in all this lot, and you have the most God awful mess.
Holiday rentals are an important part of the tourism mix. They are important for the very simple reason that not everyone wants to stay in a hotel. But herein lies the rub. The government and of course the hoteliers want everyone to stay in a hotel. They are misguided, narrow-minded and wrong. The hotels exert enormous influence both economically and politically in Mallorca - and justifiably so. Tourism growth was largely the consequence of investment in hotel stock. Many hotel chains and hotels rank as excellent. Mallorca's leading hotel chains are international players, while locally they appear at the top of the list of the island's wealth-generating businesses. They have a right to preserve what they have created, but not at the expense of a mixed tourism market. The hotel lobby, though, has been the strongest voice in seeking government curbs on the holiday-rental market. It is the hotels' self-interest which has led to much of the current confusion as legislation, communicated unclearly and implemented haphazardly by local and regional government agencies not clear themselves as to the legislation, has been heaped upon the wider tourism market in an attempt at gaining market protection. There is more than just a hint of discrimination as well. Many apartments and other holiday-rental accommodation are foreign owned.
Notwithstanding regulation that seeks to ensure that taxes are paid and that safety and quality standards are adhered to (and such regulation is to be applauded), much of the rest is a nonsense. Just go back to that bit about not marketing a flat as a holiday apartment. This is the tourism ministry saying so. What else is tourism but holidays? This is ridiculous.
The holiday-rental morass is indicative of a wider malaise, one of legal obfuscation and sometimes protectionism by the backdoor. One only has to consider the lunatic situation regarding bar closing times to appreciate how such obfuscation can be played out. Calvia town hall closed bars at 11, interpreting a new law which classified "evening" as ending at 11. The relevant ministry, environment, told them not to. What was the point of the new classification in that case? Take another example - driving licences. How many residents are clear what the rules are? Or another, that in respect of boat charters and the enormous fines being levied. Where's the fairness?
Democracies operate on the basis of fair, just and transparent legal systems, but one cannot avoid a conclusion that not all is right with the operation of local legal systems and their subsequent implementation down the chain of governmental levels, unclear as to what they mean. Too much seems to be made up on the hoof, superimposed on previous legislation and then left open to all sorts of interpretation. And the holiday-rentals market is a classic example.
All too often the response to such situations is a shrug and an "oh, well, that's Spain". It doesn't wash any longer, especially where an important part of the tourism market - and a revenue-generator for governments - is concerned. It should all be very simple. You have some accommodation and wish to rent it out. Fair enough, obtain the relevant licence, meet the relevant standards and pay your taxes. Simple. But not. Because, for example, the process to obtain the licence in the first place would fall down the great black hole of local bureaucracy. And because also there is a powerful group that will do what it can to stop you.
They need to get it sorted, but they won't.
QUIZ
Yesterday's title - The Four Seasons, "December 63", http://www.youtube.com/watch?v=TQO9LNELIKQ. Today's title - brilliant; who?
(PLEASE REPLY TO andrew@thealcudiaguide.com AND NOT VIA THE COMMENTS THINGY HERE.)
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