Negros Tourism Marketing Agency

Facilitating the Set Up ofNegros Island Tourism, Inc. (NITI)A Private Business Tourism Marketing AgencyAugust 2006

Small and Medium Enterprise Developmentfor Sustainable Employment Programwww.smedsep.ph

Written by:astrid.bessler@gmail.com

Edited by:,

Published by:

10th Floor, German Development CenterPDCP Bank Center BuildingV.A. Rufino cor. L.P. Leviste StreetsSalcedo Village, Makati City, Philippines

martina.vahlhaus@gtz.de

Printed on:

Astrid Bessler,

Carisa Aleta

Ms. Martina Vahlhaus, Program Manager

August 2006

ca-gtz@mozcom.comProgram Officer, SMEDSEP

Partner Information:

Bacolod Convention Plaza Hotel, Bacolod City

Mobile No.: +63(917)3015581Email: tqplace@mozcom.com

Negros Island Tourism, Inc. (NITI)

Ms Ruth Cruz, President

The Small and Medium Enterprise Development forSustainable Employment Program - www.smedsep.ph

Small and Medium Enterprise Developmentfor Sustainable Employment Programwww.smedsep.ph

Facilitating the Set Up ofNegros Island Tourism, Inc. (NITI)A Private Business Tourism Marketing AgencyAugust 2006

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TABLE OF CONTENTS LIST OF ABBREVIATIONS........................................................................................ 3

FOREWORD.............................................................................................................. 4

1. INTRODUCTION.................................................................................................... 5

2. LOCAL CONTEXT: MAJOR POTENTIALS AND CHALLENGES .......................... 5

3. APPROACH ........................................................................................................... 6

3.1 Process and Interventions ................................................................................ 7

3.1.1 Sub-sector Selection and Validation .......................................................... 7

3.1.2 Key Informants Interview and Tourism Sector Analysis ............................. 8

3.1.3 Results of Sub-sector Analysis Validation and Baseline Study .................. 9

3.1.4 Tourism Expert’s Missions: Marketing Action Planning and Capacity-Build-

up of Key Actors.................................................................................................. 9

3.1.5 Set-up of Agency...................................................................................... 10

3.2 Contributions by Partners ............................................................................... 11

3.3 Expected Benefits........................................................................................... 12

4. SUCCESS AND RISK FACTORS FOR INTERVENTIONS ................................. 12

5. LOOKING AHEAD: A MODEL MECHANISM....................................................... 13

REFERENCES......................................................................................................... 14

ANNEXES ................................................................................................................ 15

Annex 1 - Memorandum of Agreement by the National Association of Independent

Travel Agencies (NAITAS).................................................................................... 15

Annex 2 - Baseline Data: Bacolod - Tourism Industry Bacolod ............................ 17

Annex 3 - Operational Phase of the Tourism Marketing Agency .......................... 19

Annex 4 - Marketing Plan for Tourism Marketing Agency (NITI)........................... 22

Annex 5 - NITI Certificate of Incorporation with the Securities Exchange

Commission.......................................................................................................... 33

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LIST OF ABBREVIATIONS

DTI - Department of Trade & Industry

GTH - Gifts, Toys & Houseware

GTZ - German Technical Cooperation

NAITAS - National Association of Independent Travel Agencies

NITI - Negros Island Tourism, Inc.

SME - Small- and Medium-Sized Enterprise

SMEDSEP - Small & Medium Enterprise for Sustainable Employment Program

TESDA - Technical Education & Skills Development Authority

TMA - Tourism Marketing Agency

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FOREWORD

Around the world, tourism development is seen as synonymous with jobs and economic

growth. In the Philippines, however, the tourism industry is still miles behind despite the

large potential of its beautiful islands to bring in investments and jobs. Both the private and

public sectors are keen to promote tourism, but getting them to recognize that they should

jointly come up with solutions is not a straightforward task. Often the help of an external

party, in this case the German Technical Cooperation (GTZ), to facilitate this dialogue

process can be helpful.

This paper aims to share GTZ’s experiences in facilitating the set-up of a private tourism marketing agency to enhance the tourism market in the province of Negros Occidental,

Philippines. It illustrates a potential model on how growth catalysts such as GTZ are able to

effectively facilitate locally-owned multi-stakeholder processes built on a public-private

partnership framework that quickly produces benefits for all. A marketing agency created

from a facilitation process fills a gap for specialized services in the local market. A step-by-

step approach is described from a catalyst’s point of view in terms of supporting the

development of the tourism sector.

Thank you to all organizations and individuals who in one way or another have helped in

completing this study, particularly the members of Negros Island Tourism, Inc. who

generously gave their time to the project, the Department of Trade and Industry (DTI), as

well as GTZ Advisers Markus Ehmann, Lorenzo Templonuevo and Rita Pilarca. May this

report serve as a guide to other donors in setting up a similar endeavor in partnership with

both the public and private sector.

Martina Vahlhaus

GTZ Program Manager

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1. INTRODUCTION

Government officials, private sector actors and development professionals increasingly

recognize that as they confront demanding challenges in a globalized economy, these can

be more effectively met by building partnerships. In private sector development, GTZ’s

development partnerships with public and private sector players engage in building markets

for business services intended to help local enterprises remain competitive in the market.

The overall goal of the GTZ-Small and Medium Enterprise Development for Sustainable

Employment (SMEDSEP) Program in the Philippines is to harness entrepreneurial potential

and to encourage competition. SMEDSEP’s strategy focuses on pilot sectors on service

market development in priority provinces. In the priority province of Negros Occidental, a

sub-sector validation process led to the selection of tourism as the pilot sector, wherein the

program developed a facilitation approach for multi-stakeholder consensus-building

processes. Using a public-private partnership framework, the approach resulted in the

creation of a private tourism marketing agency.

By examining the potentials and challenges of the tourism industry in Negros Occidental and

describing GTZ’s approach and experiences, which led to the establishment of such a

marketing agency, this paper hopes to help donors and development professionals in

replicating similar experiences. It is primarily based on workshop and mission reports, a

sub-sector analysis of the tourism industry in Negros Occidental, and stakeholder interviews.

The experiences portrayed are still in an infantile stage as the tourism marketing agency had

just formally registered at the time of documentation.

2. LOCAL CONTEXT: MAJOR POTENTIALS AND CHALLENGES

To give insight on the local tourism context, its main potentials will be briefly presented,

followed by a description of the core challenges.

The province of Negros Occidental is privileged to be gifted with abundant natural and man-

made tourism resources and a fairly competitive infrastructure in terms of quality and

capacity. Bacolod, the province’s capital city, has established itself as a convention centre of

superior standard outside of the greater metropolitan area of Manila. Moreover, a varying

landscape, an attractive coastline and a rich cultural heritage have led to the creation of

tourism establishments all over the province. Within the last 10 years especially, many

tourism-related small and medium-sized enterprises (SMEs) have sprung up. Moreover, the

province is particularly well-known for its cultural events and festivals. Negros Occidental’s

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tourism product – i.e. as a leisure tourism destination – has increasingly been gaining

momentum though a variety of tourism attractions remain marginally or not at all used. There

is potential, for example, for cultural sightseeing, diving and island discovery, volcano

trekking, and other nature discovery sports.

One of the core problems for the tourism industry in Negros is the seasonality of tourist arrivals, as manifested in irregular and highly fluctuating room occupancy rates topped with

a current downward trend in average expenditure per visitor. At a time when tourists are

merely trickling in the province, the industry is underexploited and faces the difficulty of

operating profitably. In order to improve the current situation, Negros Occidental has to be

made known as a year-round tourism destination. The absence of tourism branding,

destination marketing and product marketing are the most pressing bottlenecks which

need to be addressed. Furthermore, a strong demand and supply of quality support services and training are sorely needed to improve the performance of tourism enterprises.

The tourism industry is very fragmented, lacking joint efforts to pursue a marketing strategy.

Many local initiatives to stimulate tourism have not led to effective tourism marketing but

rather, to an inefficient use of funds. This discrepancy has caused various actors to withdraw

from a coordinated way of doing marketing. To compound matters, Negros Island is

administratively split into two provinces, Negros Oriental and Negros Occidental. Indeed, an

overall absence of trust and willingness to collaborate was prevailing in the Negros

Occidental tourism industry. Therefore, the challenge lay in creating industry synergies and a higher level of cooperation and networking between and among public and private stakeholders. Fortunately, local stakeholders increasingly realized that they need to

join forces to address the untapped potential and deficient marketing of the tourism sector.

3. APPROACH

The creation of the Negros Island Tourism Inc. (NITI) was a result of a series of analyses,

interviews and workshops with various stakeholders that were designed to find a common

understanding on how to improve tourism marketing. This transparent process of externally-

facilitated discussions between business people and public sector officials resulted in a

functioning public-private partnership framework which paved the way for setting up a private Tourism Marketing Agency.

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3.1 Process and Interventions

At the core of GTZ’s interventions was the facilitation of participatory multi-stakeholder discussions, a joint action process and the provision of tourism expertise to local

stakeholders. To provide an overview of this process, a flow chart illustrating the major

interventions is presented below, supplemented by the human resources employed. The

various interventions are then outlined step-by-step, describing the tools and methods used.

• 14 days Local GTZ staff

• 3 days International GTZ staff

• 3 days external facilitator

• 20 days Local GTZ staff

• 20 days 3 local consultants

• 5 months Local GTZ staff 15 days Internat. GTZ staff

• 5 days internat. consultant

• 5-month team of 3 local consultants

• 5 days Local GTZ staff

• 2 days Internat. GTZ staff

• 4 days external facilitator

• 30 days Internat.

tourism expert (May & July mission)

• 60 days Local GTZ staff

• 20 days Internat. GTZ staff

• Internat. tourism expert (see May/July)

• Local GTZ staff (see May/July)

• Internat. tourism expert (see May/July)

• Local GTZ staff (see May/July)

• Internat. GTZ staff (see May/July)

3.1.1 Sub-sector Selection and Validation

As a preliminary intervention, GTZ invited various private and public actors to participate in a

consultative meeting for validating the selection of a pilot sub-sector which GTZ would

support for SME development. The process was as follows:

• Agreement on criteria for selecting the pilot sector: high market potential

to generate sales and investment and high potential for creating new employment

opportunities.

• Listing of proposed sectors satisfying the two criteria. • Voting on four sectors resulting in: food processing, tourism, information

technology and GTH or Gifts, Toys and House ware.

NOV 2005

Creation of

NITI

Key Actors capacitated Marketing Actions plannedExpert’s missions

Analysis results validatedTourism sector analyzedKey informant interviewedSector selected/ validated

AUG 2004 FEB 2005 AUG-DEC 2004MAY 2004

MAY/JUL 2005 MAY/JUL 2005 MAY/JUL 05

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• Assessment of short listed sectors against an Attractiveness Matrix. The selected sectors were rated to which extent they satisfy the two aforementioned

criteria, using a rating of high (3), medium (2) and low (1). Plotted on the Matrix, the

collective results put tourism first, closely followed by food production/processing.

The group unanimously decided in favor of tourism supported by the rationale that a

flourishing tourism industry will also enhance demand in the food sector.

Attractiveness Matrix

Source: Consuelo E. Misa, “Sub-sector validation workshop May, 14 2004”, Cebu City 2004, p. 11 and p. 14.

3.1.2 Key Informants Interview and Tourism Sector Analysis

To acquire a thorough understanding of the sector, ‘key informants’ – tourism stakeholders –

were interviewed as a starting point for the sub-sector analysis of the tourism industry in

Negros Occidental. This predominantly qualitative analysis looked at accommodation,

resorts, food service, travel agencies and tour operators, and transport operators, and

focused on:

• Dissecting final sales markets and market segments;

• Determining market channels and trends;

• Identifying the primary actors, their roles and relationships and mapping it;

• Creating a value chain that describes the above;

• Diagnosing constraints and opportunities for growth of the sector; and

• Identifying business services and suggesting interventions that can address

the constraints.

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Taking into consideration existing tourism initiatives, the study recommended specific

interventions including tourism promotion, product and market development as well as

institutional development:

Table 1: Specific interventions suggested

• Initiate the re-organization of an existing body composed of representatives of key

players in the tourism sector and provide organizational development assistance;

• Development of a compelling brand and product portfolio, which meet the desire for a

distinctive, authentic and unique Negros Occidental experience;

• Improvement of destination marketing of Negros Occidental;

Source: Boquiren, Marian, 2005, p. 4 ff

3.1.3 Results of Sub-sector Analysis Validation and Baseline Study

While key informant interviews were being conducted, a tourism core group consisting of

the most active business associations engaged in tourism in Negros Occidental was formed,

including the Alliance of Travel Trade Associates and the National Association of

Independent Travel Agencies (NAITAS).

NAITAS requested assistance from GTZ to provide facilitation for a workshop1 which aimed

to discuss the sector analysis results, generating a tourism marketing concept and

developing sample standard tour packages. As a result, a drafted Memorandum of

Agreement (see Annex 1) was presented, discussed and approved. This MOA reflects a

working model of existing tour and travel consortia in the Philippines.

Following the sector analysis, a baseline study for monitoring progresses and measuring

impacts of GTZ’s interventions was carried out (see Annex 2).

3.1.4 Tourism Expert’s Missions: Marketing Action Planning and Capacity-Build-up of Key Actors

To help the Negros Tourism Core group develop a Tourism Action Plan that would enhance

the Province’s positioning as a tourism destination, an international tourism expert was

1 The workshop was part of GTZ’s organizational development efforts to help NAITAS

enhance the capacity of its members in marketing and product planning.

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brought in. After a series of interviews, meetings and visits during his first mission to Negros,

the expert suggested that a Tourism Marketing Agency offering destination and product marketing be established so as to tackle the core bottleneck for the industry (see

recommended tasks in Annex 3).

At a tourism stakeholder workshop wherein the findings of the mission were presented and

discussed, the stakeholders expressed the wish to set up such an agency. With the backing

of the public sector actors and with as much neutrality as possible, representatives from the

tourism associations agreed to pursue the establishment of a marketing agency. Five

representatives from industry associations formed a preparatory committee – a task force-

that drafted a technical proposal to examine the feasibility of putting up an Agency. The

following aspects were examined: the legal form of the organization, organizational structure,

financing scheme and a 1-2 year work program (including investment and operating costs)

as well as the practical set-up.

Upon the request of resort owners and managers, the tourism expert also conducted a 2-day

workshop on improving their marketing skills. Participants from all over the province were

strongly engaged throughout the event, building their capacity and rallying support for the

TMA concept.

The expert’s follow-up mission that took place two months later focused on finalizing the

concept of the Tourism Marketing Agency (TMA) and motivating all relevant actors to agree

on it. Driven by the small group of private sector actors, the proposed concept was

approved, and a TMA materialized.

3.1.5 Set-up of Agency

A non-stock, non-profit corporation with 5 incorporators – 4 representatives from industry

associations and one from the provincial government – was chosen to be the most suitable

legal setting. The existing tourism associations and government institutions joined forces to

form the public-private partnership framework of the Agency. This business form limits the

liability of incorporators or board members, be it private or public sector actors, and above all

allows the broadest funding from all possible sources. The corporation was named Negros

Island Tourism, Inc. (NITI) and has been entrusted by government offices and business

people to execute marketing for the tourism industry.

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Chart 1: Institutional structure

Management TeamExecutive Director

Staff

Board of Trustees (11)Private Sector (8)Public Sector (3)

General Assembly of members

  The institutional structure agreed on is composed of the

General Assembly, the Board of Trustees and the management

team with several positions. The actors coming from the private

sector clearly dominate the Board of Trustees and thereby the

direction of the Agency. The exact relations between the three

levels are regulated in the by-laws which determine the control

and advisory functions within the Agency.

Source: Hilz Ward, Gottfried, p. 6, Aug. 2005

In general, the Agency is developed within a public-private framework with large

contributions from the public. NITI keeps the broadest possible funding base and relies on

sponsoring, membership fees, and institutional donations from the government and private

sector as well as institutional fundraising events. Relying on different sources for funding is

intentional so as to prevent one major donor from having too much influence on the Agency.

3.2 Contributions by Partners

There are three different partners who provided in-cash or in-kind contributions to make this

process happen and/or provide funding for the agency: private sector, public sector and

GTZ. The tourism task force invested a total of around 4-5 man months in order to undertake

fact finding efforts which led to the conceptualization and design of the agency. Four private

sponsors2 expressed their willingness to contribute cash to the agency’s financing, while

other funds will be generated from membership fees. Institutional donations were also

promised by Bacolod City, the Provincial Government and the Department of Tourism.

GTZ’s contributions take the form of mentoring/coaching, managing and technical assistance

provision (facilitating the consensus-building process, undertaking the sub-sector analysis,

and bringing in market-specific expertise)

2 Casino Filipino, Air Philippines (airline), Ceres Liner (bus transport), PLDT (telecommunications).

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3.3 Expected Benefits

The TMA holds high potential for overcoming the major bottlenecks hampering the tourism

industry in Negros Occidental. Primarily, Negros Island Tourism Inc. pursues the creation of

a unified brand to jointly market and promote the island’s tourism destinations. This would

generate more appeal for a larger market, thereby, enhancing the market positioning of the

province as a tourism destination. With the establishment of an agency that has the

mandate, resources and competence to pursue destination and product marketing, the

expected direct benefits are3:

1. Increased number of tourists visiting the province (holiday, conventions, sports and

cultural events).

2. Increased length of stay of tourists and tourism expenditure.

3. Improved image of Negros as a tourism destination.

4. Negros known as tourism destination in the Philippines and abroad.

The baseline study on Negros tourism serves as a useful tool for benchmarking and

monitoring changes in the aforementioned aspects.

4. SUCCESS AND RISK FACTORS FOR INTERVENTIONS

Although it seems too early at this stage of documentation to address success and risk

factors, there are fundamental elements perceived to have greatly contributed to the setting

up of the Agency. On the other hand, there are also some factors that could have hampered

the project from materializing.

Table 2: Success and risk factors for interventions

Success factors Risk factors Necessary preconditions in the locality:

• Economic (sub-)sector with high growth potential is existent

• Dynamic and committed local change agents are involved in the process

• Clear request for assistance comes from local key actors

• Clear go signal is sent from local actors for driving the process forward

• Willingness to join forces among public and private actors and to overcome hurdles

Situation in the locality:

• No champion in place willing to drive the process

• Local hurdles (attitude, politics) seem insurmountable

• Absence of trust hampers joint efforts and the building of a common vision

• Political issues determine the agenda of workshops and prevent open discussions

• Interest groups do not join hands and think they are better off, preferring to maintain the status quo

3 Source: Hilz-Ward, Gottfried , p. 5, Aug. 2005

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Fundamental elements in the process:

• A transparent and traceable consensus-building process is applied

• Local expectations are levelled off • External support responses to local

request for assistance are process-oriented and based on local dynamics

• Expert/Facilitator stays neutral to keep the process intact and help in brokering compromises between stakeholders

• Public-Private Partnership results in direct benefits expected from the agency’s operations

• Experts have excellent communication skills and enjoy high credibility from local actors

5. LOOKING AHEAD: A MODEL MECHANISM

The Tourism Marketing Agency is still in its infantile stage, without being fully operational

and with many unfinished organizational details. Therefore, impact monitoring is required

over the next two years to measure the results of the interventions and to see whether the

agency is sustainable. But if proven successful and sustainable, this approach -- the

facilitation of process-oriented multi-stakeholder discussions leading to consensus and

viable public-private partnerships – could serve as a model worth replicating in provincial

destinations or larger regions with a promising tourism sector because:

• It responds to local requests and dynamics, and boosts local ownership.

• It fills a significant market gap for business services, enabling the sector to grow

without distorting the market.

• It promotes public-private sector collaboration in overcoming bottlenecks through

focused initiatives and tapping hitherto marginally-used resources.

• It requires low-budget interventions (for donors).

Indeed, all partners in this public-private partnership have much to gain in such a setting: an

Agency that has the mandate, resources and competence to market and promote the

island’s tourism destinations holds the potential of achieving an increased influx of tourists,

an increased length of stay, higher tourist expenditures and an improved image as a tourism

destination.

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REFERENCES

Bessler, Astrid, “Facilitating the set up of Negros Island Tourism Inc. - Brief Description of an

Integrated Public-Private Partnership”, November 2005, Makati City.

Claravall, Bienvenido G., “Tourism Marketing Workshop for the National Association of

Independent Travel Agencies (NAITAS) in Bacolod City”, February 2005, Pasig City.

Consuelo, Misa E., “Sub-Sector Validation Workshop May 14, 2004 Bacolod City”, May

2004, Cebu City.

Fernando, Myriam, “Establishing baseline data on SMEs in SMEDSEP Pilot Projects:

Tourism in Bacolod and LRED in Leyte”, Working Paper, August 2005, Makati City.

Hilz-Ward, Gottfried, “Preparation of a Tourism Action Plan Mission Report”, May 2005,

Makati City.

Hilz-Ward, Gottfried, “Establishment of a Tourism Marketing Agency in Negros Occidental

Mission Report - 16-26 July 2006”, August 2005, Makati City.

Hilz-Ward, Gottfried, “Establishment of a Tourism Marketing Agency in Negros Occidental

Mission Report - 4-13 February 2006”, March 2006, Makati City.

Boquiren, Marian et all “Sub-sector Analysis of the Tourism Industry in Negros Occidental“,

February 2005, Makati City.

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ANNEXES

Annex 1 - Memorandum of Agreement by the National Association of Independent Travel Agencies (NAITAS) KNOW ALL MEN BY THESE PRESENTS: This Memorandum of Agreement is entered into by and between the following business entities, duly registered with the Securities and Exchange Commission and/or Department of Trade & Industry and operating with valid business permits from their respective local government units, and duly represented by their respective authorized representatives whose signatures appear below. Whereas, the aforementioned business establishments are engaged in and are integral components of the tourism industry and/or allied industries in Negros and its municipalities and chartered and component cities; Whereas, the aforementioned business establishments desire to formalize their business collaboration in the areas or marketing and promotions for Negros and all its municipalities and chartered and component cities; Whereas, the aforementioned business establishments desire to formalize their business collaboration in the areas of tour product development and tour product delivery in Negros and all its municipalities and chartered and component cities; Now therefore, in consideration of the foregoing premises, all signatories agree to:

1. Work for the common welfare of the tourism industry in Negros and all its municipalities and charter and component cities;

2. Establish an organizational infrastructure to oversee the joint marketing and promotions of tour products in the respective areas of operations;

3. Conduct joint tour planning and development, including rate negotiation with the various industry suppliers and allied services;

4. Collaborate in the timely delivery of tour product components, including and not limited to day tours and tour packages in the respective areas of operations;

5. Insure quality and reliability in the delivery of tour products;

6. Provide mutual technical assistance and support, including information sharing;

7. Design an equitable profit-sharing scheme taking into consideration third party interventions that require commission-sharing and/or referral fees;

8. Avoid unethical industry practices, including but not limited to, pirating of staff, under-cutting in pricing and negative interaction;

9. Actively seek the participation and support of other industry players, national government agencies and local government units;

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10. Accept the authority of the lead entity and abide by the decisions of the structured organization.

This Memorandum of Agreement shall be valid for a period of three (3) years from the date of signing and shall be subject to renewal for another three (3) years by mutual consent of a majority of the signatories. Signed this 5th day of February, 2005 in the City of Bacolod. Bacolod Travel DLRS Travel Jorelyn Park Shenna Mae Angeles Technotours Worldbound Estrella Moran Dina Serfino Kimberworld Décor Travel Rodney Lumintac Cynthia Flores Viva Tours SN Travel Ma. Bella Villanueva Roda Regalado DLRS Travel JHF Travel Jade Dionzon Jacquiline Juintus Filipiniana Tours Bonista Resort Greg Flores Johnny Caroll Punta Bulata Resort Freddie Zayco Bacolod City Tourism Office Provincial Tourism Office Imogen Kana-an Jennylind Cordero DTI Negros Occidental TESDA Negros Occidental Vivian Gaston Romelia Nuezca

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Annex 2 - Baseline Data: Bacolod - Tourism Industry Bacolod

Quantitative Data By Myriam Fernando (September 2005)

Table 1: Indicators and methods of data collection for Bacolod – Tourism Sector Indicator Use Source Contacts Frequency

Computerized

Number of establishments in the tourism industry

Identifies growth in the number of establishments in the tourism industry

Bacolod LGU4 City Tourism Office

Perlette Caceres Management Information Systems (MIS) Imogene Kana-an Bacolod City Tourism Officer

Annual Annual

Yes No - fact sheets available on request

Number of rooms

Indicates the increase in number of establishments and also the expansion of existing establishments

City Tourism Office

Imogene S. Kana-an Bacolod City Tourism Officer

Annual No - though an information fact sheet on tourist related statistics is released on a yearly basis.

Gross Sales5 Indicates the increase in competitiveness of SMEs

Bacolod LGU Perlette Caceres MIS

Annual Yes

Number of Tourists

Indicates success of BDS provisions and overall tourism

City Tourism Office

Imogene S. Kana-an Bacolod City Tourism Officer

Annual No – though an information fact sheet on tourist related statistics is released on a yearly basis.

Table 2: Accommodation in Bacolod – 2004

Type of Accommodation Number of Establishments

Number of Rooms

Hotels 18 1051 4 Though DTI also has data concerning SMEs, firstly the breakdown of sector type is not as detailed, and secondly, DTI is only responsible for business name registration, so many of the SMEs which register with DTI may not actually exist, as this is only updated every 5 years. 5 Though Gross Sales can be used as an indicator to measure the increase in SME competitiveness as it captures both the increase in the sales as well as the increase in number of SMEs, many SMEs will not disclose the true value of the Gross Sales due to tax purposes, hence this value is largely understated.

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Tourist Inns 15 450Pension Houses 10 192Resorts 3 68 Total 46 1761Source: City Tourism Office – Bacolod City

Table 3: Establishments in the Tourism Sector

Establishment 2000 2001 2002 2003 2004 2005

Travel agencies 46 38 50 45 50 42Hotels - first class - standard - economy

254

255

292

255

3 7 2

362

Tourist inns 14 4 11 12 21 17Pensions Houses 11 21 16 22 8 9Resorts 11 10 10 13 11Motels 6 6 10 7 7 4Cinemas 4 - 5 - 5 4Massage Clinics / Spa 5 4 3 9 11 15Antique Shops 5 2 3 - -Gift shops/Handicraft 51 44 27 49 80 107Disco, Bars, KTV 35 29 39 58 96 76Restaurant 111 400 205 260 370 338Fast-food 114 - - - - -Tour Guides 1 - 2 - 1 1Rent – a Car 5 2 2 6 3 5Coffee Shops 13 84 36 42 21 23Lodging houses 8 9 4 2 4 4Golf Club 1 1 - 2 1 1Department Stores 5 3 - 9 8 3Ticketing / Airline Terminal 5 - - 12 9 7Bus Lines / Shipping Terminals 5 - - - - -Shipping Lines 5 - - - - - Total 461 668 435 560 720 678Source: City Tourism Office - Bacolod City (Assessment Tax data sheet)

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Annex 3 - Operational Phase of the Tourism Marketing Agency

Recommended tasks for 1st and 2nd year of operation By Gottfried Korbinian Hilz-Ward (May 2005)

1 Branding 1a Task Creation of a strong common brand for the destination Purpose Improves industry cohesion in destination

Convincing and lasting client contact, reinforces product sales Sub-Tasks Define and agree on Unique Selling Propositions

Define future regional destinations within the Province (i.e. South Coast, Highland, Bacolod, North Coast) and identify their typical character Formulate and visualize branding slogan and logos Put results to discussion and achieve approval Test branding elements with some tourist groups

1b Task Implement a brand-based corporate identity Sub-Tasks Develop a corporate identity for the Marketing Agency and other

contact points/agents Disseminate CI to stakeholders for multiplier effects Test CI elements amongst stakeholders

2 Destination Marketing 2a Task Tourism Portal/Website Sub-Tasks Draft information elements

Creation of emotional experience Establishment of contact with suppliers and marketing agency Examine sales/distribution element; reservation tool News message board Reflect brand of destination Ensure proper functioning and visitor friendliness

2b Task Tour operator Manual Purpose Provide compact information package to tour operators to assist

their product packaging and sales Sub-Tasks Design and produce folder which can take insert documents

Prepare (low cost) set of general information for insert: Main attractions with entrance fees, transport modes with schedules and costs, travel times and distances, accommodation establishments with prices and contact details, transport and incoming operator contacts, selected tour proposals, main entertainment facilities with prices, main handicraft and shopping outlets personalised contact with Marketing Agency Prepare (low cost ) set for frequently changing information for insert: calendar of cultural and sports events, calendar of conventions and meetings, new hotel/resort projects

2c Task Publication of Image Brochure Purpose Hand-out material to potential clients to build positive attitude

towards destination and guide to travel decision Sub-Tasks Prepare brochure profile for intended target groups: language,

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size, print/photo ratio, information content, emotional experience, number of copies Build up photo archive for publications Design presentation of destination, sub-regions, recreation activities, leisure opportunities Professional brochure design, best photo and print quality General map with main sites Examine sponsoring by strategic partners

2d Task Publication of practical information guide Purpose Travel Planner for individual tourists before and after their arrival

on Negros Prepare brochure profile for intended target groups: language,

size, print/photo ratio, information content, emotional experience, etc Draft text on all practical information for visitors: Main sites and attractions with opening hours and entrance fees, transport modes, distances, schedules and prices, shopping and handicraft, selected hotels/resorts (alternative all hotels/resorts or a separate accommodation guide can be published), travel agencies, special restaurants and delicacies; police/doctor/hospital contact details, Distance travel map and selected city maps Examine financing through commercial advertisements

2e Task Publication of event calendar Sub-Tasks Establish early information system on event announcement

Set up and maintain event data bank with event organiser contact details Publishing of event calendar (cultural and sport events) every 6 months Examine commercial financing through advertisement

3 Product Marketing 3a Task Competition analysis Purpose Improvement of competitive position, learning from best practices Sub-Tasks Identification and SWOT of main competing destinations for key

products Analysis of comparative opportunities (both convention and leisure) Identification of best practises Data base on past conventions and respective clients Analysis of TO catalogues on comparable leisure packages and pricing

3b Task Marketing strategy related to prime products Sub-Tasks Detailed identification of target groups for existing main products

Proposal on target group approach and instruments Cooperation with product suppliers on joint marketing Timetable of proposed actions Introduction of success criteria and benchmarking

3c Task Establishment of target group data base Sub-Tasks Data base of Tour-Operators (leisure travel and special interest,

such as diving) in Philippines, Southeast Asia, Europe, US,

- 21 -

Australia Data base of Associations and relevant corporate clients in the Visayas, Philippines and gradually neighbouring countries Data base of Professional Congress Organisers in the Philippines and SE Asia Data base of media and journalists who publish tourism features/articles

3d Task Publication of a Convention Planner Purpose Support associations and corporate clients in the preparation of

meetings and conventions Sub-Tasks Establish a profile of the publication

Collect relevant information on: meeting facilities (location, capacities, equipment, contact details, etc), accommodation (capacity, class, prices, contact details), catering firms, transport companies (transport modes, prices, contact,etc.) entertainment facilities, pre- and post-meeting arrangements and organizers, travel agencies and PCO’s Arrange a highly professional publication in outstanding quality

3e Task Implementation of selected marketing actions in addition to above

Sub-Tasks Preparation of a Marketing Action Programme that is gradually put into practice (depending on the human and financial resources of the Marketing Agency in the first two years of operation;

- Media PR campaign (fam trip for journalists, publication of travel articles)

- Participation in trade forums and fairs (relatively expensive, selected fairs only)

- Tour Operator networking campaign (proposal of model packages, announcement of new products, fam trip)

- 22 -

Annex 4 - Marketing Plan for Tourism Marketing Agency (NITI)

Draft Plan for 2006-2007 By Gottfried Korbinian Hilz-Ward (February 2006)

2

1. Current Negros Tourism Products2. Product Details3. Improving the Product4. Priorities for Marketing5. Target Markets and Market Segments6. Adventure Negros – Brand Strategy7. Destination Marketing Basic Promotion Material (Must Have) I8. Marketing Actions

Outline of Marketing Plan

3

1. Current Negros Tourism Products

Beach Leisure and Recreation

MeetingsConferences

Events

Active Tourism,

Outdoor Sports

Cultural Sightseeing(G

ame Breeding)

English Language Courses

Key growth product

4

2. Product Details

Language schools in BacolodUniversity

coursesSufficient

private accommodation

•Variety of historic and other cultural sites•Old Silayheritage sites•Sugerplantations and sugar mills•Steam railways•Bacolod City•Mascara Festival

•Diversity of landscapes and environments•Kanlaon National Park•Network of hiking trails in NP and beyond•Bicycle trails to/from Bacolod•Clubs to support products (guides)•Excellent diving grounds•Several dive clubs•3 quality golf courses•Resorts for active tourism along beaches and in mountain areas

•Bacolod hotel and conference facilities•Casino Filipino•Golf courses•Attractive side arrangements•Mambucalresort/ wellness

• 65 beach and inland resorts•Excellent beaches and coves in Sipalay, Sagay, Escalante, San Carlos, etc•Leisure and water related activities for all target groups•Dive clubs

LanguageCultural Sightseeing

Active TourismMICEBeach Leisure

5

3. Improving the Product

Product study Analysis of

product with schooös and professional operators

Expand on-site experienceAnalysis of cock

fighting/ game breeding product

Mapping and preparation of hiking and biking trailsSignage of trails

(sponsorship)Increase trail

system. Diversi-fication (inter-island trails)Organisation of

guides, training and language trainingPackaging and

organisation of toursImprovement of

security in diving (decompression)Definition of

seasons for active products

Focus on small and mid-size meetings and conferences

Upgrading of resorts

Quality improvement programme (quality workshop)

Introduction of a quality label(Negroshospitality)

LanguageCultural Sightseeing

Active TourismMICEBeach Leisure

6

4. Priorities for marketing

ActionProduct typeState of product

Needs packaging

Needs organising

Is ready to sell

Install focus groupsInvolve tour operators

Mountain bikingRoad bikingHiking

Arrangements with golf clubs and tour operatorsInstall focus groups

Golf packagesJet ski

Immediate marketing and promotion

Beach holidaysMeetings, conferencesScuba Diving Sightseeing toursLanguage class

Product...

7

5. Target Markets and Market Segments

International:Students learning

English (Korea, Taiwan, Thailand, China)

Domestic: expatriatesStudentsYouth exchangeMICE programme

from Cebu

International:Groups and FITs

(Europe), discovery tours

Domestic:Amateur biking/

hiking groupsExpatriatesEuropean biking

enthusiastsTrekking groupsCorporate groups,

also incentivestudents

Golfers (Phil., Japan, Korea)

International: divers (Europe, Taiwan, Korea)

Domestic:

Corporations from Negros, Cebu and IloiloCorporations with

countrywide operationsNon-Governmental

organisationsPublic

organisations from NegrosGovernmental

organisationsScientific institutesNational

associations (national meetings)

Domestic: Families, couples, groups from Bacolod, Iloilo, Dumaguete

Domestic: Weekend package tourists from Manila and Cebu

LanguageCultural Sightseeing

ActiveMICEBeach Leisure

8

6. Adventure Negros – Brand Strategy

NITI has chosen „Adventure Negros“ as the umbrella brand for promoting the destination. This brand signifies a change of direction to brands previously used for marketing. ‘Adventure’ products such as trekking, mountain biking, diving and others are only partially operational yet. It should be avoided therefore to position Negros as a pure adventure destination at this point. Leisure, sightseeing and MICE remain still strong products and need to be covered by the umbrella brand as well. It is recommended to create several sub-brands underneath ‘Adventure Negros’ where each product can develop its profile. Adventure Negros could therefore become a promotional slogan.

A principle objective is to focus destination promotion on a clear set of commercial and available products. The brand can use emotional images but needs to be in line with the product message.

9

7. Destination MarketingBasic Promotion Material (Must Have) I

Purpose: Material for hand-out,Tourist Information Office, Trade fairs, Promotion Events, Media information, Target group campaigns

Features images of destination, creates desire and shows travel opportunities; it is recommended to present themes (instead of regions) i.e:beach and coast, underwater, mountains and nature, Bacolod, people and culture. Includes map. Excludes information that needs frequent updating. Format A4 or slightly smaller, landscape or portrait. 12 pages. Highest quality possible .

1.General image brochure

3.1 Features Negros as a top place for meetings and confe-rences. Creates interest and desire.Outlines the advantages/ qualities of Negros. Accomm., Culinary features, post conference programmes Relates to Adventure Negros. Addresses HR managers and Board members.Format A4, 8 pages.3.2 Listing of venues with relevant details, appropriate catering establ., excursion, sports, cultural events, transport, other suppliers, tour agencies, tourism offices.

3. Meeting and event planning kit3.1. Meeting/event promotion brochure3.2. Practical meeting planner3.3 Folder to hold brochures/flyers (also to hold additional flyers from individual hotels

Delivers all essential information for planning a trip to Negros:Travel modes and times, local transport, accom-modation incl. Tel., email, website, main visitor sites and opening hours, different types of restaurants, key tourism information offices. Additionally proposes selected itineries, also for active tourism with contacts, etc.Includes map (more detailed than above).Frequently used format:A5 flyer or other compatible to image brochure

2. Practical information kit/brochure

10

Preparation of Promotional MaterialCorporate Identity

Ensuring that all promotional materials belong to the same family and express best the destination brand: Adventure Negros

---------------------------------------------------------------------------------------------------• Collect comparable material from several different destinations and identify

concept and styles of Corporate Identity• Define own concept and prepare brief for designer specifying key elements of

Corporate Identity such as logos, slogans, preferred colours and layout, format, etc. but allowing artist creativity

• Present and discuss analysis and brief in Board Meeting• Request CI sketch proposals from 2-3 graphic designers at fixed price.

Proposals shall include formats, layouts, letter fonts, coloring, papers,etc. for all basic print materials

• Present and discuss proposals in Board or General Membership Meeting and choose preferred proposal

• Contract designer for final design and tender print work

11

Destination MarketingBasic Promotion Material (Must Have) II

Three main content categories:Regions (I.e.Bacolod, Northern Coast, Southern Negros, Mountains)Main productsInformation (transport, accommodation, food, information, culture, etc)

+ NITI contact and information on NITI

Website is crucial and urgent

Negros Adventure Website/Portal - Actions

Reserve www. Adventurenegros.comWeb Address

Design this first website as little complex as possible, without reservation functions, internal web, or sophisticated links

12

Destination MarketingBasic Promotion Material -Production

• Basic promotional material is outsourced to graphic designers and printing houses. NITIsrole is to draft specifications, to supervise and monitor work

• NITI Board to discuss maquettes and draft design in view of optimising publication• Promotional material shall be produced in an order of priority

13

Destination MarketingBasic Promotionial Publications – cost estimate

P 25.000P 100 x 2502.2 Tour Operator Manual documentation (in holding folder), similar to 2.1

P 500.000Website design and initial operation

P 75.000P 3 x 25.000Corporate Identity Design

P 300.000P 100 x 3.0003.3. Holding folder

P 60.000P 20 x 3.0003.2.Meeting planner(for Human Resource managers)

P 210.000P 70 x 3.0003.1 Meeting/event promo brochure (for corporate/association clients)

P 500.000P 50 x 10.0002.1Practical information folder (for consumer)

P 1.000.000P 100 x 10.0001.General image brochure(for consumer)

Total costAmount-cost per item(estimated)

Type

14

Destination MarketingOther Promotion Material (Should Have)

Promoting beach and inland resorts, featuring the various fun and sport activities. Creating interest and desire. Structured in North, Central and South Region.

Adventure Negros Resorts

Bicycle route map and plannerBicycle trail decription (individual sheets per trail)

Negros by bicycle

Conditional to availability of guides and trail networkHiking and trekking guide (theme flyer)

Theme promotional brochures

Should be produced only if several packages cn be offered. Needs a tour operator for packaging and ground handling. Brochure could be co-financed. High quality publication.

Golf vacation

A divers paradise (theme flyer)Audio-visual documentation/promo on diving and dive sites

15

8. Marketing Actions - General

In cooperation with tour operatorsTravel package promotion on website and in cooperation with sponsors (airline, shipping company, casino, etc)

Media fam trip for Philippine journalists and tv

Database of tour operators (from Philippines, Asian and European target markets) which are active in Negros products

Aim is to obtain more detailed knowledge on specific traget groups and how to reach them. Surveys could be done by tourism students as their degree works or other university research work. NITI itself should not carry out such surveys.

Conduct of market research, surveys on active tourism market segments

Comparison of products, analysis of competitors, quality assessment, networking with tour operators

Study tour to international tourism trade fair in SE Asia with suppliers

CommentsAction

Aim is to have a growing collection of photo images available for use in promo publications, PR articles, website, etc.Collect/copy available digital photos (high resolution only) and photo negatives from NITI partnersOptions: organize amateur photo competition or hire professional photographers

Build-up of a photo library of Negros and tourism-related images

16

Marketing Actions - Leisure

Trainer: experienced hotel/resort sales manager and/or tour operator4Q 2006

Sales training course for resort owners/managers

Product presentation in Negros for Philippine inbound operators

Sensibilisation of resort owners for professional marketing

Organisation of a meeting with resorts on a sales campaign

Prepare standard PR articles, make available high quality phote material

Public Relation Campaign in Activity magazines (Philippines, USA, Europe, Southeast Asia)

CommentsAction

Benchmark Study comparing Negros Occ. resorts with Bohol and Negros Oriental

17

Marketing Actions – Meetings and Events

Mailing promo brochure and meeting planner to selected associations and Human Resource managers

Attention to high qualityPreparation MICE promo brochure and meeting planner

Mailing promo brochure and meeting planner to multipliers: ministries, Governmental and NGO, embassies, chambers of commerce

a) -b) Information provided by hotels and business directories

Set-up of a database of a) MICE infrastructure, services,

suppliers in Bacolod and Negrosb) Associations and corporations

(potential clients) in the Philipines

CommentAction

One day event in Bacolod with presentations and visits to meeting facilities and hotels(in collaboration with Casino and airline)

Organisation of either fam trip or product presentation to Manila and CebuProfessional Congress Organisors

18

Marketing Actions – Active Tourism

Networking with golf clubs and associations in target markets

In cooperation with major inbound operator in ManilaFam trips for active tourism TOs from Europe and US

Attractive and feasable products must be available. Be done with inbound tour operator.

Press releases to biking magazines and advertisements for biking packages

CommentAction

Participation in Dive Expo 2007 in Bangkok

19

Marketing Actions – Other

Cooperation with Bacolod training institutesPreparation of information/promotion folder for language studies

Desk survey, contacting universities and language schoolsCooperation with Bacolod training institutes

Market study on English language classes and courses in Taiwan, China, Thailnd, Japan

CommentAction

Advertisement and board notices in language schools and universities in target markets

20

Proposed Marketing Action Programme 2006

Resort product presentation

Sales training for resort managers

20.000Photo library

Tour-operator and MICE database

1.000.000Production of general image brochure

75.000Corporate Identity and Corpoprate Design

500.000Design and opening of destination website

Cost estimate in PMain Actions

21

Proposed Marketing Action Programme 2007

Media fam trip for Philippine press

Consumer tourism fair Manila or special interest trade fair

Launching of travel packages and promotion on website and with sponsors

MICE mailing campaign, multiplier lobbying

Product presentation in Negros for Philippine inbound operators

25.000Tour Operator Manual and Holding Folder

270.000Meeting and event theme brochure and planning kit

500.000Production practical information kit

Cost estimate in PMain Actions

Page 33 of 33

Annex 5 - NITI Certificate of Incorporation with the Securities Exchange

Commission

Manila Office

Cebu Office

10/F German Development CenterPDCP Bank Centre BuildingV.A. Rufino cor. L.P. Leviste Streets,Salcedo Village, Makati City

SMEDSEP Program c/o GTZ OfficeManila, P.O. Box 2218 MCPOMakati City, Philippines

Tel. No.: +63 2 8123165 local 46E-mail: smedsep@mozcom.comWebsite: www.smedsep.ph

38 Acacia Street, Lahug, Cebu City 6000

Tel.: +63 32 4122256Telefax: +63 32 444494E-mail: masmedsep@globlelines.com.ph

Contact Information