The Tribune

By NEIL HARTNELL

Tribune Business Editor

The Bahamas has generated "over 250,000 room nights" for the Nassau/Paradise Island destination alone during the past year via an $18 million investment in airfare credit promotions, the director-general of tourism yesterday saying he was "bullish" on the industry's outlook.

Confirming that the Ministry of Tourism and Nassau/Paradise Island Promotion Board had agreed to reinstate the airfare credit to stimulate fall and winter 2012 bookings, David Johnson told Tribune Business the joint public/private sector promotion had "made huge difference" to hotels throughout the Bahamas.

Explaining that in some cases it had allowed properties to keep open room inventory they would otherwise have closed, Mr Johnson said the credits - effectively subsidies for the cost of airline tickets - had made the Bahamas "much more competitive" in an environment where tourists were increasingly looking for value deals.

The Bahamian tourism industry was seeing stopover arrivals growth "every month" in 2012 compared to last year, Mr Johnson added, and was still on track to record an average monthly 5-7 per cent growth for the year to-end August.

And, indicating that the Ministry of Tourism was bullish on the sector's prospects, the director-general said he believed the Bahamas was "going to steal market share" from its rivals, aided by its US proximity and strong private/public sector partnership.

Confirming the airfare credit's return, Mr Johnson told Tribune Business: "We have had discussions with the Nassau/Paradise Island Promotions Board, and have agreed to a promotion of the airfare credit to be launched to stimulate fall business.

"We anticipate that being launched between July 16-August 20. That's the booking period that we propose. We're waiting on a final approval from the Board, and I have it in hand. That's the effective date for the promotion."

The director-general said the latest version would offer airfare credits (subsidies) between $200-$350 per booking. Visitors booking a stay of six nights or more would receive a $350 credit, while those staying between three-five nights in the Bahamas will receive $200.

Speaking to the impact of previous airfare credit initiatives, Mr Johnson told Tribune Business: "We invested some $18 million in the last year, and generated for Nassau/Paradise Island alone just over 61,000 bookings. That's significant. The average booking was for about 4.5 nights, so you're looking at over 250,000 room nights. It's a significant dent."

And he added: "We believe it has made a huge difference, and we get no objection from hotels who are saying the same thing, not only in Nassau/Paradise Island but in Grand Bahama and some of the Family Island properties.

"In some cases, without it room inventory would have been shut down because demand had softened to such an extent.

"It has made the destination much more competitive in a market where value is perceived in part by pricing and offers. It gives the Bahamas the ability to offer an aggressive promotion to visitors."

Confirming previous Tribune Business disclosures that the Bahamas was on track for 5-7 per cent average monthly year-over-year increases in stopover visitors up until end-August, Mr Johnson said: "We are considered, within the region, to be in a bit of an enviable position, the Bahamas.

"Given that many destinations have seen significant drop-offs in airlift, significant drop-offs in European visitors, the Bahamas is in an enviable position. We're pretty much holding our own and getting through this in pretty good shape, seeing gains every month compared to previous years."

The director-general added that he felt "very strongly that the Bahamas is repositioning" itself in the tourism industry, aided by Baha Mar's $2.6 billion redevelopment of Cable Beach.

While running a construction project and operating a hotel, on the same site and at the same time, was usually fraught with difficulty, Mr Johnson said Baha Mar had been coping "very well". He added: "Properties usually get a significant fall-off when there's construction, but we're not seeing that."

The Bahamas was also continuing its push into "new growth markets that are very lucrative", Mr Johnson noting that its push into Latin America via the direct Copa Airlines airlift was a case of starting small, but growing at "a significant rate".

Elsewhere, the Bahamas had enjoyed a rebound in its core US east coast market, especially New York, where over winter 2012 it had "reaped the benefits of a surge" in business.

"We are not where we'd like to be with Florida," Mr Johnson conceded, suggesting that the state's still struggling economy was holding back recovery in this source market. "We're still competing, and pushing and making a lot of investment there."

The director-general said the Ministry of Tourism was also taking steps to position the Bahamian tourism industry for the long-term by making inroads into the long haul Asian market, a move also designed to make this nation "more competitive" for when the Baha Mar project opened.

The Ministry has been holding talks "across the board" with airlines in a bid to facilitate the airlift increase required when Baha Mar comes on stream.

"They [the airlines] have every confidence that what we're talking about is going to actually happen," Mr Johnson told Tribune Business. "They're saying to us that it's very rare that a destination comes with an integrated approach to airlift development.

"We've seen many compliments from the airline suppliers, and assurances that the Bahamas is an anchor destination for them in the Caribbean. They've indicated they have ways they can respond to demand, and the need for additional airlift going forward. They can come up with specific ways to do that."

And Mr Johnson added: "We have a new energy in our organisation, and are going to be very aggressive going forward. We feel we're going to steal market share because of our location and the partnership synergies we have in the Bahamas between the private and public sectors.

"We're bullish on tourism, although we know we must increase our per capita tourist yield."

Mr Johnson said the Bahamas was seeking to increase total tourism revenues, as well as yields, given that the industry was a volume-driven business. This nation, he added, was seeking to attract visitors staying in both high-end and mid-priced properties, and was "not using all its capacity".