HOSPITALITY AND TOURISM

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HOSPITALITY AND TOURISM ADVISORY SERVICES
Introduction and Methodology The Ministry of
Tourism Government of Israel November 2006
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Quality in Everything We Do
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Agenda

• Introduction
• The Approach
• The Methodology

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Introduction
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Introduction
A Fully Integrated Team

• Fully integrated advisory team three groups
  representing the best in class in their
  respective fields
• Unparalleled team in terms of
• Global presence and resources
• International and local knowledge
• International experience in tourism development
  and marketing
• Technical and process expertise
• Proprietary models and unique tourism databases
• Comprehensiveness of services offered
• Capacity to serve the worlds largest and most
  demanding clients

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The Research Team
A Fully Integrated Team

• The advisory team represents the best in class in
  their respective fields

• Project management and infrastructure assessment
• Policy, economic analysis and tracking
  forecasting systems
• Source markets and future marketing strategy

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The Research Team
Ernst Young, LLP Project Leader

• Worlds largest professional services firm
• 106,000 employees in 140 countries
• Global Real Estate, Hospitality and Construction
  practice with 3,500 employees in more than 25
  countries serving more than 4,000 clients
• The Hospitality and Tourism Advisory Services
  group
• Advisor to the leading organizations in the
  hospitality industry
• Knowledge leader in hospitality, tourism and
  leisure
• Extensive international experience
• Expertise in hospitality tourism infrastructure
  development

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The Research Team
Ernst Young, LLP Hospitality Tourism
Advisory Services

• Extensive international experience in
• Hotels
• Resorts
• Mixed-Use Developments
• Convention Centers
• Amusement Parks
• Sport Facilities
• Museums
• Other Leisure Real Estate

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The Research Team
Global Insight Travel Tourism Advisory

• Track global travel demand by origin and
  destination
• Monitor and forecast tourism for 163 country
  markets
• Conduct market strategy, investment policy, and
  tourism economic development analysis for
  destinations around the world.

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The Research Team
Short List of Global Insight Clients

• World Travel Tourism Council
• NYC and Company
• Intercontinental Hotels Group
• Kerzner International
• Hilton Hotels
• Abu Dhabi Tourism Authority
• Travel Industry Association of America (TIA)
• US Office of Travel Tourism Industries
• Hong Kong Tourist Board
• Ontario Tourism Commission

• Canadian Tourism Commission
• Singapore Tourism Board
• Visit Britain
• Dubai Tourism and Commerce Marketing
• Various Resort Developers
• American Express
• Orlando CVB
• Irish Tourism Board
• Bahamas Ministry of Tourism
• Turkish Association of Travel Agents

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The Research Team
IPK International

• Leading international tourism consulting group
• Specialist in tourism research and tourism
  marketing for 35 years
• Network of institutes and tourism consultants in
  all European countries, North America, South
  America, Africa and Asia/Pacific
• Highly skilled researchers and statisticians
  having vast experience in conducting quantitative
  and qualitative surveys around the globe
• More than 1,000 tourism studies around the globe
  successfully completed
• Owner of the World Travel Monitor, the worlds
  most comprehensive tourism data bank on the
  European, Asian and American outbound travel
  behavior

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The Research Team
IPK International

• Public Sector Clients
• Ministries,
• Tourist Boards,
• Other public organizations from more than 40
  countries worldwide
• Private Sector Clients
• Hotel Companies
• Airlines
• Tour Operators
• Theme Parks and Other Attractions
• Numerous other international clients

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The Approach
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Holistic and Results-Driven Approach
Analysis and Practical Strategies

• Supply
• - Hospitality Tourism
• Infrastructure
• Aviation and Investment
• Policy

Demand - Source Markets Demographics,
Attributes, Attitudes Preferences
Development and Marketing Strategies
Economic Impact and Return on Investment
A New Era of Tourism Growth for Israel
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The Primary Research
Research in Fifteen Countries

• Interviews with 104 tourism industry stakeholders
  in Israel
• 135 site inspections of tourism infrastructure
• 500,000 annual interviews for World Travel
  Monitor survey
• Survey interviews with a total of 8,400
  respondents in 8 countries
• 18 focus groups in 8 countries
• 51 interviews with international tour operators
  in 8 countries

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The main goal isTo substantially grow inbound
tourism and to establish tourism as a leading
engine of growth for the Israeli economy
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The main obstaclePerception versus Reality
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Israel Current Perception
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Israel Current Reality
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The Methodology for the Research of
the International Outbound Markets
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Methodology

• Phase 1 Research of 17 International Key
  Markets based on IPKs World Travel Monitor
• Phase 2 Further In-Depth Research of the 8 most
  promising Markets
• Based on
• Qualitative Research ? Focus Groups
• Quantitative Research ? Population Surveys
• Trade Research ? Tour Operator
  Interviews

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Methodology of Phase 1
Research of 17 International Key Markets
The selection of the 17 outbound key markets was
made according to the following
criteria Consideration of

• the most important international outbound markets
  worldwide
• the most important markets for Israel at present
• markets having a high share of Jewish population
• and
• worldwide coverage Europe (West and East)
  America, Asia

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Fulfilling these criteria, the following 17 intl
markets were selected (in accordance with the
Tourism Ministry)

• America
• USA
• Canada

• Western-Europe
• UK
• Germany
• France
• Italy
• The Nordic Countries
• The Netherlands
• Switzerland

• Eastern-Europe
• Russia
• Poland
• Hungary

• Asia
• China
• India

• These 17 markets represent
• 60 of all outbound trips worldwide
• 75 of the outbound trips to Israel
• 90 of the Jews living in Diaspora

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• The 17 Intl Key Markets were surveyed / analyzed
  regarding
• the general outbound travel behavior
• the travel behavior to Israel
• and as a benchmark
• the travel to the most important competitors
  (Turkey, Greece, Italy, Egypt)
• Method and Database
• IPKs World Travel Monitor

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World Travel Monitor Facts

• The World Travel Monitor is
• an annual study surveying the outbound travel
  volume and travel behavior in all European and
  all important American and Asian countries, since
  1988
• representative of the population in each country
• interviewing more than 500,000 consumers per
  year(15 years and older)
• carried out via telephone interviews (CATI
  system)
• applying the same questionnaire / method in all
  countries

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World Travel Monitor Facts

• The World Travel Monitor is
• the sole and largest tourism information databank
  worldwide
• providing comparable tourism data on European,
  American and Asian outbound travel behavior
• Clients from the public and private sector are,
  among others- The European Travel Commission
  (ETC) - The UNWTO- Numerous tourism
  destinations worldwide (Spain, Greece, Italy,
  Mexico, Brazil, etc.)- Tour operators (TUI,
  Thomas Cook, Kuoni, etc.)- Consultancies
  (McKinsey, Boston Consulting, etc.)

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Methodology of Phase 2
In-Depth Research of the 8 Most Promising Key
Markets

• 8 markets offering the best opportunities for
  Israel were identified out of the 17
  international Key Markets
• Criteria for the selection (among others)
• Size of the market / market prospects
• Affinity towards Southeast Mediterranean
  destinations / Israel
• Affinity towards specific products / holiday
  types
• Religious affiliation
• Spending behavior / share of high spenders
• etc.

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Based on these Criteria the selected 8 Markets
were

• America
• US

• Western-Europe
• UK
• Germany
• France
• Italy
• Sweden

• Eastern-Europe
• Russia

• Asia
• China

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In-Depth Research Program for each of these 8
Markets

• Qualitative Research
• 2 Focus Groups per country
• In the US and UK 3 Focus Groups each

based on 18 Focus Groups
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Method of Focus Groups

• Per group 8-10 participants (consumers)
• Men and women (approx. 50 each)
• Different age groups (25-65 years old)
• Middle and higher education and income classes
• Religious affiliation (except for China)2-3
  participants practicing Christians /
  Evangelicalsat least one representative of the
  Jewish population

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Method of Focus Groups

• All participants with travel experience to the
  Southeast Mediterranean (especially Egypt,
  Greece, Turkey)
• All participants interested in a trip to Israel /
  at least 23 persons with travel experience to
  Israel
• Selection / identification of participants
• in the scope of pre-screening / pre-interviews

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Conduction of Focus Groups

• The Focus Groups were conducted by institutes
  specialized in qualitative research (ICC/ESOMAR
  members) in the individual countries (under the
  guidance of IPK)
• Each Group was guided and analyzed by an expert /
  psychologist specialized in qualitative research
• All Focus Groups were conducted according to a
  guideline of topics

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Focus Group Tasks

• Determination of topics such as
• awareness / perception of Israel
• factors of attraction
• factors of rejection
• assessment of the different products / offers /
  holiday types
• strengths / weaknesses of the offer
• expectations towards the product
• comparison with other destinations / competitors
• etc.
• as well as a
• test of TV commercials

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In-Depth Research Program for the 8 Top Markets
2. Quantitative Research in each of the 8
markets
based on surveys representative of the
population
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Sample of the Population Survey

• Only persons with outbound tourism experience
  last 5 years and / or intention next 5 years.
• Sub-sample of Jewish / religious people,
  respectively Evangelicals (depending on the
  countries predominant religious group)

• The sample (in each of the 8 countries) was
  determined by a pre-screening.
• The appropriate pre-screening questions were
  asked in a sample being representative of the
  population (according sex, age, regional
  distribution, etc.).

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Population Surveys

• At least 1,000 interviews per market
• Telephone interviews (CATI method Computer
  Assisted Telephone Interviews) in all markets
• Random selection of the interviewees
• Partner institutes of IPK, specialized in
  quantitative population surveys in the
  respective countries
• All institutes following ICC / ESOMAR standards /
  codex

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Task of the Population Survey
Specific questions with regard to Israel were
asked, such as

• image of Israel
• future interest potential for Israel
• interest in different holiday products
• factors of attraction / motives of Israel
• relevance of religious motives
• price image
• travel season
• accommodation preference
• booking preference
• future target groups

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In-Depth Research Program for the Top 8 Markets

• Trade Research
• In total for all 8 markets
• Per market 5 8 interviews

based on 51 Tour Operator Interviews
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Method of the Trade Research
In accordance with the client, important Tour
Operators offering / not offering Israel were
chosen for each market
51 Tour Operators in total Europe 37 / USA 9 /
China 5
30 Tour Operators offering Israel
21 Tour Operators not offering Israel
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The Tour Operator Interviews were conducted

• via telephone
• with senior managers responsible for Israel / the
  Southeast Mediterranean
• with the help of a guideline / questionnaire

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Task of the Tour Operator Survey
Determination of topics such as

• image of Israel in the tour operators view
• strengths / weaknesses of Israel
• positioning of Israel vs. competitor destinations
• interest in including / extending the Israel
  offer
• expectation regarding sales support
• aviation and lodging
• etc.

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Method Data Pool for the International Markets

• All in all
• a very comprehensive data pool
• with a high validity and reliability
• allowing the development of secured marketing
  strategies
• for Israel in the international markets

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