21 Nov Retailers and hoteliers talk about INNOVATUR (I)
We have already heard Alberto Bernabé, the minister of Tourism for Tenerife Island Council (INNOVATUR’s main partner) talk about the need to commit to innovation in tourist destinations. We have also heard from Dimple Melwani and David Pérez who are Tourism Councillors in the zones where this modernisation project is being implemented. The time has come to listen to the views of retail and accommodation establishments through Abbas Moujir, secretary general of FAUCA, and Jorge Marichal, president of Ashotel, to learn first-hand what it means to bring innovation to these business models.
What importance do you attach to innovation when developing a business model?
Abbas Moujir (A.M.): With the public’s changing consumer habits, we consider innovation as an essential element to be able to move forward or for a commercial business to be successful. This is mainly because a new competitor has appeared: electronic commerce. Obviously, this means that small businesses must adapt to this new way of operating.
Jorge Marichal (J.M.): When we talk about tourism, we are talking about a very competitive sector. This is not only because of the demands of the potential customers who want new experiences, new sensations, new services… but also because of fierce competition between the sector’s operators. This competition also helps of course and is a positive force for improving the industry as a whole. Therefore, innovation is very important because it gives us new ways of understanding the business, of seeing where we should be taking our hotel business and it helps us, supports us and gives us methodologies to face these changes.
Why is it necessary to modernise hotels and retail operations in Puerto de la Cruz and Arona?
A.M.: Puerto de la Cruz is trying to regain the importance it used to have within the island’s tourism sector. It is implementing renewal policies throughout the hotel and retail sector, with building work taking place in several of the municipality’s open shopping areas and pedestrian streets. Los Cristianos is also an area which, in order to be more competitive, needs its retail establishments to adapt to the 21st century and to this new modern tourist. The tourists who now come here are very much guided by social networks and travel with their mobile apps which they use when deciding whether to make a purchase or which restaurant to go to.
J.M.: Obviously, the profiles of the tourists who came thirty years ago are not the same as they are today, far from it. It is therefore time to think about whether we can develop our hotels to specialise in a particular segment, whether we can approach our renewal from the point of view of a specialisation which gives us differentiation and will allow us to focus on one segment and, although we will not be so generalist, we will certainly be able to differentiate ourselves from the rest of the competitors, which is very important.
“If we want high-quality tourism, we have to offer high-quality retail adapted to the 21st century”, Abbas Moujir (FAUCA)
What are the needs of retail and accommodation establishments in these tourist areas?
A.M.: Innovation is not just about technology. To innovate also implies, for example, language: a fundamental element that can, curiously, sometimes be found lacking, despite the fact that both are tourist areas. Image is another important element of innovation: in these two municipalities you can still see businesses with commercial policies which appear to have come from the 1970s; if we want high-quality tourism, we have to offer high-quality retail adapted to the 21st century.
J.M.: It is first and foremost about renovating the facilities, both those which customers see and those they don’t, because what customers see is influenced by what they do not see. We must address them both: the supporting services that customers don’t see and those that the customer sees, which are the ones that generate more expectations. All this in the form of new services, new facilities… Sports facilities have already been installed in many four-star and superior hotels as demanded by the customer: gyms, fitness rooms, yoga studios, relaxation suites, and so on.
“What customers see is influenced by what they do not see”, Jorge Marichal (Ashotel)
What are the next objectives set by your organisation for the reactivation of these areas?
A.M.: We cannot talk about improving the retail establishment without improving the environment where it is located. The reverse is also true: we cannot rehabilitate a street without ensuring that the establishments there also adapt to this new situation. Therefore, it is important to have a common policy that is applied in the environment and also in the establishments. It must be a joint and global measure, internal and external to the business.
J.M.: They must go hand in hand with actions related to public infrastructure, with everything linked to beaches, promenades, avenues… Everything that constitutes an attraction for customers when they are outside the hotel. Also to complement and improve diversity in the leisure spaces provided, not just understanding this to mean discos, although it does include them, but also for the type of hotels we have, leisure facilities for the whole family, where all generations can participate during the daytime.
What is the value of public-private partnerships in renewing business models?
A.M.: For Fauca one of the main elements of its action plan is innovation, but if this is point 1, then “1.a” is public-private collaboration. We have been committed to this since we formed Fauca twelve years ago. In fact, we have already gained some experience in municipalities such as Santa Cruz de Tenerife where we created a mixed public-private grouping with the Society for Development. So, it’s important. A commercial policy cannot be applied in a municipality if there is no collaboration between all the administrations and the business sector.
J.M.: In Tenerife we have an example of success with the Consortium of Puerto de la Cruz, which clearly shows that when the private and the public go hand in hand things work well. It would be pointless for the hoteliers of Puerto del la Cruz to renovate their hotels if the public spaces were completely out-dated and run-down or, vice versa, for there to be significant public investment but for the hoteliers not to step up to the mark.
If you have found this interesting, in the next post we will continue talking with the representatives of the hotel and retail sectors in Tenerife about the tourists they are interested in and how INNOVATUR can help those companies which sign up to the project.