At the World Travel Market in London recently, Tourism Malaysia & Malaysia Airports met and signed an MOU to promote domestic tourism.
A fund will be created (not sure where the money will come from but I have a hunch it’ll be the tax payer) to support marketing campaigns by airlines and travel industry players in 2018.
Anyone know why they had to go to London to sign the MOU? And for that matter, how will an airport promote tourism? And how this project will link with other initiatives?
Mass tourism is barely forty years old. I can still remember family discussions back in the seventies about how a British traveller was only allowed to take a maximum of £50 out of the country which meant few people could travel. With a father based in Malta and Gibraltar, as well as Hong Kong and Singapore, I was lucky enough to see more of the world than many.
Anyway, a few years ago we were hired by Malaysia’s tourism ministry to carty out what was at the time, and probably still is today, the most comprehensive brand audit ever done for a country’s tourism board. You can get a copy of a case study on the project by sending me your email address.
Due to client confidentiality rules, I can’t disclose all of our more than 300 recommendations but I can say that one of the recommendations was for a comprehensive overhaul of the incentives offered to the private sector to encourage more investment in the stagnant tourism sector.
During the brand audit discussions with visitors who had visited Malaysia, an often repeated comment was that they loved the country but didn’t think there was enough here to make them come back again. Yet to build a successful destination brand, you need that repeat visitation. This requires ongoing investment in products.
One of the problems in Malaysia is that property development is essentially risk free because of the sell then build model used here. What this means is that projects are often sold before work on them begins. Compare that to an investment in a hotel than has no guarantee of success and even if it is successful, can take 10 – 15 years before the developer sees a return on investment.
To my knowledge there have been few changes made to major tourism related policies because outside of Kuala Lumpur, there has been very little investment in the tourism sector. In fact, one frustrated operator complained recently that there are more 5 star hotels in Hua Hin Thailand than there are in the whole of Malaysia, excluding Kuala Lumpur.
This has to change and it has to change soon before this opportunity is lost. Because the next 10 years are expected to see a travel and tourism boom.
Which is why South East Asian countries are investing heavily in their tourism products. After years of rising room rates and high occupancy, Australian investors and developers are increasing hotel development from Perth to Sydney and Hobart and up to Melbourne and Brisbane.
Australia’s hotel supply is growing 2.5 times faster than its long term average rate and 12,000 rooms will be added to the inventory by 2020. Tourism related investments are now close to A$30 billion, up from $17 billion in 2014.
Tourism investment is a priority for Indonesia as the government aims to attract 20 million visitors by 2019 and is revamping it’s tourism incentive programme to encourage investment.
According to the Saudi Gazette, the King of Saudi Arabia will spend 12 days in the country from March 1st as part of his Asian tour, and tourism development will be high on the agenda as the country targets over US$25 billion investment from Saudi.
Confident of positive long-term growth prospects for Thailand’s tourism industry, institutional investors from Hong Kong and Singapore accounted for around 45% of the total transaction volume in the country.
In Malaysia, according to Pemandu, the organisation set up to oversee the government’s transformation programme, RM24.5 billion (US$6 billion) of private investment was made in the tourism sector in Malaysia in 2015, making it the second highest private investment contributor, despite an alarming fall of 6% in arrivals in that year.
During the King of Saudi Arabia’s tour of Asia, he will also spend 3 days in Malaysia but the country’s ailing O&G industry appears to be the main topic on the agenda. Other figures for investment in tourism in Malaysia are hard to come by. However, outside of the capital, anecdotal evidence suggests investment is minimal.
Malaysia also suffers from a weak international image as well as a lack of buy in from stakeholders such as taxi drivers, travel and tour operators, hoteliers and retailers.
This needs to change otherwise Malaysia may miss out on the increased arrivals into the region as evidenced by the image above that shows the fastest growing flight routes around the world.
According to this chart, outside of India and China, the fastest growing routes will be to SE Asia. If Malaysia wants a bigger piece of this dynamic industry, it needs to make some significant policy changes to encourage more investment in the tourism sector.
Twitter, facebook and other social media communities have been buzzing with comments related to the RM1,800,000 (US$600,000) Tourism Malaysia (TM) is spending on Social Media (SM). Here’s a little background on the story.
Initially, the deputy minister of tourism was quoted as saying that the RM1,800,000 “covers the cost of hosting various activities on the facebook page, including six interactive Flash applications, development and maintenance work and advertising.” He went on to say that, “the ministry spent nearly RM300,000 to develop each of the six applications on their facebook page.” I could only find one (see screenshot below).
This statement was rejected by citizens and government ministers alike with one minister suggesting it was a waste of funds as the facebook site is free and using the ‘Visit Penang’ facebook page as an example (see screenshot below), explained that it was set up for free and had attracted over 100,000 fans.
Citizens were even more incensed, with one enterprising and concerned tax payer setting up a facebook page that parodied one of the official government pages (see screen grab below). Within hours, this page had attracted 5 times as many ‘likes’ as the official page.
A couple of days later, the tourism minister announced that, “the RM1.8 million (is) for a full social media branding campaign, and not just to set up a facebook page.” She went on to say, “”(The money) is for responding, informing, interaction and monitoring (work on the facebook page), evaluation, data collecting, content development and advertising on Google, Facebook, etc…”
With her comments came an official release that stated the costs were for the following:
1. Technical
* Dedicated hardware deployment
* Software licencing
* Front end applications
* Application server engine
2. Development of six campaigns that require the following:
* Flash games engine
* Flash programming and coding
* Creative development and design
* Campaigns ideas and concept
* Front-end Flash design
* Testing and debugging
3. Campaign promotions
* Digital advertising campaigns on Google and facebook
* Contest, page wall and tourism fanpage content management
* Collection and management of database
The tourism minister then went on the offensive, asking reporters, “Do you think it’s cheap to set this up?” And as if to justify the expense, explained, “Tourism Australia is spending RM150 million (US$50 million) for the next three years on social media.”
Most recently, the minister stated that the allocation was to ‘run, manage and monitor a tourism campaign in the social media, including RM360,000 for advertising and over RM500,000 for prizes for the contests organized.’
‘Disappointed and hurt’ she is reported to have invited the Malaysian Anti-Corruption Commission (MACC) to investigate the campaign finances.
It is too early to determine the results of Tourism Malaysia’s first foray into social media but whatever the results, the Malaysian government, the tourism minister and the tourism ministry could have handled the matter more effectively and efficiently.
One would be forgiven for thinking that Tourism Malaysia has some internal communications issues. Because when the deputy minister first explained what the funds were spent on, his statement didn’t make sense. The deputy minister’s statement suggests he was provided with notes written by someone more familiar with the workings of an IT department than the requirements of a social media campaign. This has caused the deputy minister to be embarrassed in parliament and I hope someone has been reprimanded.
In terms of the social media exercise, Dave Duarte MD of South Africa based Huddlemind and a social media expert who was in Malaysia as the story broke stated in his blog that the exercise has already justified its expense.
His rationale is based on his guesstimate that the average conversion rate of a facebook fan to a customer is approximately 3% and because the average domestic tourist spends RM2,500 with 40,000 fans, the facebook page has already recouped its expenses.
This statement may be a little optimistic but it is certainly worth tracking the number of ‘likes’.
In terms of the game itself, it seems OK, leaning heavily on guitar hero. Personally I found the racial profiling of the characters unnecessary. Playing the game requires one to be more dexterous than I and as a result, the score required to qualify for the iPad 2 draw will always be beyond my means! I suspect I’m not the only decision maker in the family who will feel the same and this resulted in me leaving the page rather disappointed. But I digress.
So Tourism Malaysia’s (TM) long overdue foray into social media has not had an auspicious start. In the future, what can this key organization that contributes over RM50 billion (US$16.6 billion) to the national purse do to ensure tax payers get value money for all social media branding initiatives?
Here are 10 key recommendations for future initiatives
1) A social media strategy or any of the tactics within that strategy, is not the responsibility of the IT department. In future, the head of the department responsible for social media initiatives should represent the ministry when talking to the press and his press release should be prepared by him and his department and not by anyone else. Although the minister or his/her deputy must respond to questions in parliament, it is wrong to expect them to be knowledgeable about branding tools such as social media. Ministers do not need to talk to the media about such relatively small activities.
2) Social media requires an ongoing strategy and interactive initiatives such as the facebook pages are merely tactics within the strategy. Successful social media initiatives must be integrated with other branding initiatives.
3) I strongly suspect TM didn’t think through what they were doing when they launched the facebook pages. First of all it is important to develop a plan. Within that plan and before embarking on a social media strategy, it is important to identify what are the goals and how can facebook add value to branding efforts. Facebook is obviously an additional channel to interact with prospects and customers but why do it? To get more fans? Why? To get more participants? Why? How does TM convert those participants in the competition into leads? How does TM put a monetary value on social media activities? What metrics should be used? All of these should be outlined in the social media plan before implementation.
At the moment, registration is only required if participants want to be included in the draw for the iPad or meals. So how will TM optimize interactions with those participants and get them to become customers?
4) It’s also important to get fans to interact with other participants and to interact with participants. Critical to the success of any social media campaign are the conversations. Channels such as facebook are not platforms to broadcast messages about the company or in this case, Malaysia. The cuti cuti 1Malaysia facebook page has generated over 40,000 likes in a very short time and this is impressive. Furthermore, many of the postings on the wall have generated plenty of comments but TM is failing to enter into discussions with those who comment, preferring instead to pass that responsibility to others (See screen shot below). Interacting and engaging with people who comment is what social media is all about and will give TM more visibility, improve reputation and increase trust.
5) This first foray into social media is pretty basic and there is nothing wrong with that. But in future, Tourism Malaysia must look to be more innovative with what it does on social media. Fans will soon get bored of commenting and uploading images, especially if issues raised are ignored. Tourism Malaysia must encourage fans to be more creative. Perhaps by designing trips, submitting and voting for slideshows or setting up sub groups of specific niche related fans.
6) What makes being a fan special? At the moment nothing really which is a good and bad thing. Good because it means more people will become fans but bad because TM doesn’t know how many fans are really interested in the product or just want to win an iPad. In future, TM must look for ways to offer special content to fans or competition participants. Don’t be afraid to ask people to register.
7) This maybe a bit difficult for TM because technically, it isn’t allowed to sell Malaysia, only promote it but that doesn’t mean it can’t turn facebook into a potential profit centre. TM should make it easy for fans to book trips to destinations featured on the TM facebook the way it does on its website.
8) TM is still using mass media tactics on social media channels. This is ineffective and pointless. TM needs to stop thinking demographics and start thinking communities.
9) This applies to everyone and not just TM. Pause before creating a facebook group. Managing a group is difficult, time consuming and requires talent and patience to be able to respond to issues raised and continue a conversation till it’s natural end. TM launched four or five facebook pages at the same time! That requires a lot of talented manpower and judging by the lack of responses to issues raised, TM was ill prepared. Also important is what to do with the facebook group once the contest or event is over. It you want to delete a group, you have to manually delete every member of the group. With 40,000 members and growing, and with at least two clicks required to delete a member, the cuti cuti site will take a lot of manpower to shut down! If TM decides not to close down pages, in five years time, there will be a lot of dead pages that will confuse people.
10) The big question with facebook is what to measure and how to calculate ROI. In 2010 a study stated that fans of the top twenty brands on facebook were worth an average of US$136 each. With 40,000 fans, that would make the cuti cuti page worth over RM16 million! However the study was panned as it was actually a measure of the value of customer loyalty and not a measure of how much facebook had contributed to that loyalty. Moreover, the average of 20 brands like Nokia and Apple bears no relevance to tourism anyway!
As TM doesn’t technically have a product to sell, it is hard to know what to measure. For instance, TM can’t measure the ROI of acquiring a prospect and turning that prospect into a customer via facebook and comparing it with other customer acquisition programmes.
In reality, Measuring the ROI of facebook fans is probably impossible, especially for a national tourism agency such as TM and especially when the facebook page features a competition that allows multiple attempts from the same user and the end product is a future staycation.
As the dust settles on this rather unfortunate event, TM and its agency has a lot of work to do to sort out its social media strategy. It’s not a great start, and a lot of mistakes have been made. The key is not to make the same ones again.
brandconsultantasia.com 