think sideways Phuket at the Crossroads Let the market drive the brand? Or drive the brand to the market? AMCHAM Phuket 30 November 2011
Brand Phuket 1970s Bridge connects island to mainland Phuket Airport opens Brand Perception DISCOVERY
1980s A handful of luxury hotels open Amari 1985 Amanpuri 1988 The Boathouse 1989 International travellers discover Phuket Brand Perception DISCOVERY/HIGH-END/EXOTIC
Thought Leader Phuket in the 1980s had similar potential to Bali. Its advantage was its access. Phuket was that much closer to the lucrative European markets. Its weakness was its perceived lack of culture. Brand Perception DISCOVERY/HIGH-END/EXOTIC
Origins of Mass Tourism 1990s Visitor arrivals multiply 5 times from 500,000 to 2.5 million by the Millennium Growth from Western Europe, Asia and Australia Brand Perception ASPIRATIONAL/LONG- HAUL/FRAGMENTED/EXOTIC?
Brand Phuket Popularised Globally 2000s Visitor arrivals grow to 5 million Airport expansion agreed on Early part of decade sees massive property speculation (despite government restrictions) Remarkable rebound despite Tsunami Growth from Eastern Europe led by Russia Growth from Asia led by China Brand Perception ASPIRATIONAL/LONG- HAUL/FRAGMENTED/EXOTIC?
The market today 60 High-End, Mid-Tier, and Budget/Economy Accommodation High-end Mid-tier Budget 56 50 40 30 27 20 10 12 0 % of Market High End 27 Mid-Tier 56 Budget 12 Percentage of overall market
Perception of Brand Phuket Aspirational Phuket Arguably the world s most popular tourist island Recognised for its beach, sun, accommodation and leisure activities Small meeting facilities (convention centre will add to aspirational value of brand) Not recognised for culture High perceived value for all maritime and sea activities Maintained exotic quotient.
Perception of Brand Phuket Aspirational Phuket Market segments that aspire to visit, live in or purchase property in Phuket have evolved considerably in the last few years. The verticals have expanded and the greatest opportunity is the higher end of the middle income bracket as this is the widest segment and supplies the largest numbers of visitors to the island.
Perception of Brand Phuket Greater Phuket message What exactly is Phuket?
Perception of Brand Phuket Greater Phuket message Is Phuket Town even featured? Beach vs. lush green? Outlying islands? Phi Phi? Similan? Phang Nga? What are the perceptions of these areas?
Perception of Brand Phuket Greater Phuket message While tourism has spread north to the mainland, developers have tried to harness Phuket s popularity by branding their projects as Greater Phuket. At the same time there are tourists who specifically choose Phang Nga because it is NOT Phuket. Phang Nga people don't want Phang Nga to be spoiled like Phuket. - Anurag Ramanat, South Asia Law Co.
Perception of Brand Phuket Access Significant incremental growth Direct scheduled routes from Europe, Asia and Australia Destination Phuket is perceived as within range and within value proposition for Europeans, Asians and Australians across multiple segments.
Perception of Brand Phuket However Fragmented Aspirational to multiple segments Many verticals No cohesive marketing strategy Suffering from Brand Thailand mismanagement and multiple crises Individual marketing destination campaigns such as by Laguna, Royal Phuket Marina create complex messaging Massive growth in certain areas of the island Brand Patong East-West divide No single body is taking responsibility for harnessing Brand Phuket.
The market today 450,000 400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000 - Visitor arrivals 2010 2009 2008 2007 Australia China UK Swededn Russia
Some projections 6000000 5000000 4000000 3000000 2000000 1000000 0 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 Year Phuket Total Visitors Since 2006 there has been a 21.6% increase in tourists or an average of 38,875 visitors a year. Based on 2010 visitor numbers, by 2014 there will be more than 5,665,593 million visitors to the island.
Some projections 10000 8000 6000 4000 2000 5749 6968 8187 0 2010 2014 2018 Rooms 5749 6968 8187 There are currently 43,571 rooms in registered accommodation establishments in Phuket. In 2010 there was an increase of 5,749 rooms available in accommodations representing a 12.9% increase to the existing supply. In 2014 that number is expected to rise to 6,968, an increase of 16%. At this rate, by 2018 there will be an increase of 8,187 rooms available on the island.
Some projections Foreign Tourists 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Foreign Tourists Since 2006, foreign tourists have increased by 13.07%, or 75,351 visitors a year. By 2014, this number will reach 4,807,430 visitors.
Some projections Projected number of rooms maintaining the current ratio of 12% Luxury, 56% Mid-Tier, and 12% Budget. 60000 50000 40000 30000 20000 10000 0 43571 50539 51758 28301 28984 24399 11764 13645 13974 5228 6064 6210 2011 2014 2018 No. Rooms Lux. Mid Econ.
THE CROSSROADS
THE CROSSROADS BRAND PHUKET IS AT A SIGNIFICANT CROSSROADS IN ITS EVOLUTION TWO CLEAR PATHS OR A HYBRID? ALLOW MARKET FORCES TO DRIVE EVOLUTION?
THE CROSSROADS OR DEFINE A STRATEGY, FORM BRAND PHUKET TO MAXIMISE THE MULTIPLE STAKEHOLDERS RETURNS AND CREATE A SUSTAINABLE BRAND AND ENVIRONMENT FOR THE ISLAND AND ITS PEOPLE
Culture
The future of the island How much land is still available? Will a land and building tax be introduced? Impact of recent changes to zoning regulations? Will restrictions on foreign ownership be eased?
The future of the island Infrastructure? Air travel? Municipal authority Phuket Tourist Association TAT
The future of the island Is Phuket still as desirable as it was: Pre-Tsunami 2004 Coup 2006 Global financial crisis 2007 Suvarnabhumi airport occupation 2009 Riots 2010 Flooding 2011?
Brand Phuket Bring the people of Phuket into the brand: Warmth History Character Passion for Phuket
Brand Phuket Take advantage of all of the natural resources of Phuket: Maritime Hills Rubber plantations Beach Sea Islands and their attractions
Brand Phuket Define the indigenous culture of the island: Architecture Festivals Village and community life Natural environment
Brand Phuket HARNESS AND FORM THE CULTURE TO BRING PRIDE TO ALL THE PEOPLE OF PHUKET.
Perception vs. reality
Perception vs. reality
Perception vs. reality
Perception vs. reality
Next steps WORK WITH A UNIFIED BODY TO DRIVE CONSOLIDATED ACTION. DO NOT LET THE MARKET DRIVE EVOLUTION. Thank you