Written evidence submitted by ECE - European Cultural Experiences Ltd, A C Tours, E Voyages Ltd and others

Promoting Britain Abroad – DCMS Committee Submission

The following submission is supported by 20 inbound tour operators (TOs) and Destination Management Companies (DMCs) based in England and Scotland in response to The Promoting Britain Abroad DCMS Enquiry. It’s a response from independent operators with skin in the game that act as Britain’s sales and marketing force internationally

This response follows the DCMS terms of reference:

• What needs to be done to re-establish the UK as a holiday destination for international travellers?
• What should Government and the tourism boards be doing to support the inbound industry in its recovery?
• What will the impact on the UK’s hospitality, cultural and heritage sectors be if inbound tourism is slow to recover to pre-pandemic levels?
• Does the Tourism Recovery Plan go far enough to support the industry’s recovery from Covid-19 pandemic?

What are the biggest challenges to delivering the plan?

• What should the UK be doing to maintain the status as a soft power superpower and further promote its culture and heritage on the global stage?

-          How can the UK capitalise on its exit from the European Union?

-          What are the biggest threats to the status of soft power superpower?

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1.0   What needs to be done to re-establish the UK as a holiday destination for international travellers?

1.1 Business Support and Continuity Funding

Clearly the economic health of the inbound industry must be of consideration given TOs and DMCs facilitate over 60% of all international visitors (Source: VB 2016). Without this infrastructure, which is competing with European competitors for inbound revenue much of Britain’s above the line marketing support will be dissipated without connection with the strong international agent B2B network developed

Recent surveys undertaken by UKInbound highlight the parlous financial state of Inbound Tour operators and DMC’s especially those in England who, other than through furlough have seen no revenue for almost 2 years with “The Britain is Closed” badge clear to the international B2B and B2C client base.

This is in marked contrast with our European neighbours and competitors who have benefited from longer border opening periods and significant Government support -evidence previously supplied by UKinbound in their July 2021 DCMS TERF submission.

Closer to home the UK approach is contrary to Government support provided to Irish operators and of course in Scotland where the Scottish Government through Visit Scotland provided substantial support to tour operators and DMCs by way of the Scotland Inbound Tour Operators Covid 19 Business support and Continuity fund and its subsequent extension to Day tour operators – a sum of £15 Million awarded in April 2021.

This in contrast to the UKInbound TERF submission request for £47 Million to support 230

Tour Operators and DMC’s that seemingly was filed. £47 million to support a £28.6 Billion income stream

Whilst UK Government clearly believe that VAT reduction and the devolvement of business support funds to local authorities is the correct approach it has meant a highly fragmented and seemingly non comparable approach to business support – individual pubs receiving significant support levels compared with either nil or minimal support for inbound tour operators either via funding and/or business rate relief – a post code lottery. The recent press comment regarding Government pressure on Local Authorities to spend their ARG’s and Business Rate Relief funds may filter through for the benefit of our cash strapped sector.

Many of our TOs and DMCs have offices across Europe to facilitate pan European travel. Comparisons with how our competitor nations support their travel businesses have been well documented and circulated to DCMS, VB and relevant tour operator associations. When Government ministers are advised of these foreign support levels they appear very defensive towards the UK case quoting £25 billion support for tourism; leisure and hospitality sectors – which includes, furlough in all sectors, tax breaks and loans. Other than the appreciated furlough funding very little extra of this has found its way to inbound operators.

1.2 International Representation

Visit Britain and its use of resources must come under scrutiny if we are to seek to provide a world beating inbound tourism industry in terms of:

-          Senior management leadership and communication with the inbound trade. The senior management team of Visit Britain are seen as remote, lack understanding of sector trade channel requirements and appear focussed purely on digital marketing channels. This is in stark contrast with say Ireland where Niall Gibbons leads a team from the front inspirationally living and breathing inbound tourism to the benefit of the nation. This percolates through their structure where close trade relationships are encouraged and where there are perceived to be synergistic benefits from an integrated marketing approach to tourism marketing expenditure.

By contrast those of us with longer memories remember when VB’s predecessor was much more supportive, recognised the value of and actively engaged with the inbound trade channel and provided either free or heavily subsidised joint overseas missions – for mutual benefit.

-          Overseas Offices: In contrast TOs and DMCs have respect for VB management in many overseas offices and as a result see this exercise as fine tuning of VB especially given the current fragile nature of the sector.

-          Inbound Trade Representation: Many in the inbound sector believe if there were more inbound trade representation on the Board of VB with a steering group working with senior management with more discussion and joint planning there would be greater efficiencies, a better ROI on investment made. A high-profile steering group made up of senior representatives of VB and the inbound industry working from strategy evolution to activity implementation is deemed relevant.

-          Communication and channel focus. There is more to successful inbound tourism than digital marketing. It seems that the B2C channels are the priority and other traditional B2B channels are seen as having a lower profile and interest. Tourism Ireland appears much tighter in this respect, Visit Scotland as well.

-          VB support. Many TOs and DMCs invest in overseas trade missions and speed-dating events which prior to Covid 19 were face to face. The allocation of grants to individual businesses; the physical cost of these events and in instances the seniority of potential clients attending have been causes for concern. There is a view that these events are seen as an income stream potential for VB to augment their funds.

-          Working with the Inbound Sector – Many DMCs and TOs working in European markets will enthuse about the support received from specific national tourist boards. Tourism Ireland is seen very much as a role model for how the business should interact with TOs and DMCs. This isn’t just financial but tangible support to help launch new programmes sourcing suppliers, helping with the initial development work etc with fast response times from the national tourist board.

Contrast this with VB’s travel strategy to DCMS in Summer 2020 which exclusively focussed on domestic tourism to the total exclusion of inbound.

-          Independence – A tricky one. If you are reliant on National Government for income can you lobby Government for change be it funding, additional support, change to travel protocols, tax changes etc? Perhaps VB has been too sensitive in this area as a result alienating the inbound industry. It is noticeable that VB had not shared the plight of the inbound industry publicly until early December 2021. A VB Inbound meeting in September 2021 hastily convened with inbound operators yielded little in the way of tangible support and the trade members left feeling that Inbound had been forgotten during the previous 18 months.

1.3 The need for an integrated marketing approach

Many years’ experiences in FMCG marketing recognises that the most efficient and effective marketing investments are planned and communicated in advance reflecting above and below the line activities co-ordinated for the best effect. In simple terms to get the best out of a media campaign it is better to share the detail and timing of this campaign with your international network so supporting promotional activities can be co-ordinated to optimise the effectiveness.

That means buy in is necessary at an early stage with all trade channels relevant. Digital and consumer marketing cannot work in isolation with traditional trade channels.

The trade reaction to the latest VB Buzz seekers campaign exemplifies why there needs to be much closer dialogue between the brand owner and these channel operators.

Our message is simple: let’s focus on what we’ve done best to get the volume business back to the UK and leave the niche sectors for when we are back in business and can afford the luxuries.

1.4   Image of the UK

Britain has had immense global media exposure both positive and negative in relation to Covid 19. From success with the Astra Zeneca/Oxford vaccine through to the pace of vaccinations is countered with negative levels of infection/hospitalisations/deaths in the initial waves but with still very high levels of infections more recently arising from the Omicron strain.

At the right time we need to be leading that Britain has now “re-opened for business” extolling both iconic reasons to visit but also confidence in our health, hygiene, and travel protocols – the latter encouraging people to plan trips to the UK with the ease and minimal cost of meeting travel protocol requirements at the time confident that goal posts (and costs) will not change.

1.5 Supply Chain

The role that TOs and DMCs play in the Tourism supply chain has previously been documented to DCMS: key driver of economic recovery, funnelling business to all parts of the UK including less well known and acting as the UK’s sales and marketing force competing with our near neighbours.

A recent Inbound endorsement campaign undertaken by the Coach Tourism Association, leading West End theatre producers, leading attraction providers (Merlin Entertainments) highlights a few of the many business sectors that rely on inbound tourism revenues for significant revenues. To this list can be added city centre locations and venues, hotels, restaurant and other hospitality venues, stately homes, other transport providers together with many regional suppliers.

Any dilution of this TO and DMC network will materially affect many of these other suppliers.

However, we face similar challenges particularly in the hospitality sector with hotels, restaurants, pubs etc restricting availability due to availability of staff post furlough as has been widely documented in the media. Group tour series are proving difficult to place for this reason.

1.6 VAT

The loss of VAT reclaims (Tax Free Shopping) is of serious concern to the industry and not just to Central London luxury shops and airports. Air – Association of International Retail will provide the economic case to DCMS but many inbound operators, particularly dealing with Asian and African clientele have concerns that business will be lost to mainland Europe given the priority retail therapy has with clients from such markets.

The success of outlet shops particularly Bicester Village, McArthurGlen etc. reflect the wider economic impact from international visitors.

Changes in VAT rates in the inbound travel sector have little effect on TOs and DMCs – if you have had no business for almost two years it is irrelevant!

1.7 Cashflow

The absence of revenue brings obvious cashflow issues, but these are exacerbated where payment is via credit cards. Credit card merchants are tightening their risk exposure to the travel sector with the resultant impact on cashflow to the operator – big or small.

2.0   What should the UK be doing to maintain the status as a soft power superpower?

DCMS feedback in this respect is provided by an Inbound Operator with many years of experience running international events, music festivals and educational programmes attracting business from across the globe from the youth market – response by way of case study:

2.1 The London International Youth Science Forum (LIYSF) www.liysf.org.uk

This event now in its 62nd year (2021 virtual) brings up to 500 of the brightest young STEM students from up to 70 countries to Imperial College each year for a two week residential programme of lectures, scientific visits, social and cultural immersion with iconic attraction visits. Since inception LIYSF is about bringing young people from different nations together to learn about each other and our different cultures through a shared passion for science. It boasts Nobel Prize winners as speakers and patronage from HRH The Princess Royal.

LIYSF showcases British Science, its universities and education system to this global audience. Historically close links with British Council has enabled sponsorship of National Science Competitions across the world where an investment of c £2.5- £3.0K per country yields significant positive media and PR for the UK and its institutions. But:

-          British Council budgets have been cut over the years with funds withdrawn back to the centre and there is financial competition with other projects centrally driven.

-          Students applying often have tortuous processes to go through from Border Agency enquiries as to financial solvency – for a 2-week educational event. The acceptance process ensures that only relevant and viable students are invited.

-          LIYSF works with a balance of nationals attending. The lure of Chinese income can be compelling after barren years for on campus participation.

-          International charities and sovereign wealth funds have part filled the British Council funding void but 2 years with highly restricted income is concerning for what has become a become a UK Science rock internationally

2.2 Harrogate International Youth Festival – Music and Performing Arts

This annual Easter event that welcomes both UK and International youth musicians and performing artists to North Yorkshire brings young people from across the globe to mix, perform and share each other’s cultures through the passion for music and performing arts in iconic venues around Harrogate and Ripon. In its 48 years of operation, it has welcomed over 30,000 international students to the UK.

Financially dependent on the international visitors attending the challenges are to maintain the network after two years without attendances and the travel protocols of both host nation and countries of origin – when planning through to arrival.

On a more international basis many such events and educational programmes appear to be more influenced by the requirements of the nation customer than a strong desire to learn about UK culture, its educational systems, institutions etc. “Belts and Road” funding is an easy trap to fall into and impacts not just tourism but also our educational system. Internationally – Britain’s soft power influences?

3.0 Tour Operators and DMCs supporting this submission