Businesses still seeing loss of revenue and profit
Despite the fact that air arrivals are down 13.4 per cent from this time last year, the Cayman Islands isn’t losing customers to other Caribbean destinations, according to President of the Cayman Islands Tourism Association Stephen Broadbelt.
He made the point during a presentation to the association’s membership during a meeting held recently at the Ritz-Carlton, Grand Cayman.
Mr. Broadbelt noted that while Cayman comes in at 15th in the region for air arrivals, data is not available for Guadeloupe or Cozumel, which are typically ranked higher than Cayman. This leaves Cayman at about 17th – exactly the same place as last year.
‘So we’re not losing any market share, we’re staying right around the same position as we were last year. We’re not losing customers to other destinations at this point in time but it’s something that we need to keep an eye on now more than ever in the past,’ Mr. Broadbelt said.
He said most other destinations have negative air arrival numbers, but Cuba and Jamaica have increased air arrivals by over three per cent.
The top six Caribbean destinations in terms of air arrival numbers are The Dominican Republic, Cuba, Cancun, Jamaica, Bahamas and Puerto Rico with more than 100,000 air arrivals a month.
‘The Dominican Republic gets more air arrivals in a month that we do in a whole year,’ said Mr. Broadbelt.
The Bahamas has lost some market share and its air arrivals are 14.5 per cent down. Cancun’s arrivals are down 17 per cent – probably related to the swine flu.
In regional cruise arrivals, Cayman has gone up a spot to third place, behind Cozumel and the Bahamas.
‘So, although Cayman moved up a position we don’t have any increased cruise arrivals to show for it,’ said Mr. Broadbelt.
Mr. Broadbelt said arrival data is not the only measure to be looked at.
‘We have to look at what they spend when they get here, especially with hotels giving nights away at extremely low rates just to get the traffic through here,’ he said.,
He said air arrivals numbers don’t necessarily equal profit.
‘What we’re seeing across the board is a loss of revenue and a loss of profit,’ he said.
The average length of stay in Cayman is just over six nights, the average group size is two and the expenditure for 2008 per person per night in CI$ was $162 compared to $191 in 2000.
The cruise visitor spending for all visitors was CI$433 million in 2008 compared to a peak of CI$527 million in 2000. However, the number of landed visitors nine years ago was only 928 compared to 1,398 visitors that landed in 2008.
Mr. Broadbelt noted that occupancy figures for condos/villas and apartments in August 2009 were just 35 per cent.
‘It’s a pretty low number when regional averages for occupancies are up in the 60 per cent for hotels and condos,’ he said.
For this year (through August) hotel occupancy is down an average of 5.5 per cent from 2008.
Mr. Broadbelt said room stock is slipping – especially in the hotel category.
‘We’ve looked at air arrivals and looked at occupancy levels in hotels and condos and what watersports and restaurants are doing and at 300,000 [arrivals] it’s just not sustainable to support the industry and provide for us. We have to do more than just get by.
‘After Ivan most of us were just happy to still be doing business and as each year has gone by we’re lucky to be breaking even and it’s down to the air arrivals. Every person I’ve asked if their business would do better with 400,000 air arrivals – no-one has said ‘no’ yet, so I believe that to be the case.’
He said that in the last 18 months, shorter booking windows have been the norm.
Also, guests expect to get a better deal no matter how much money they have and the industry has had to work harder
Yet the industry is finding new ways to communicate with guests through networking sites such as Twitter.