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Cruise3Sixty Dispatch: New CLIA President and CEO Takes Center StageApril 17, 2011 By: Susan Young
In her first Cruise3Sixty conference keynote address on Friday, April 15, in Port Everglades, FL, Christine Duffy, the new president and CEO of Cruise Lines International Association (CLIA), showed her passion for promoting the critical value of the travel industry to the U.S. economy and her commitment to assuring that government leaders “get” that concept.
During the nation’s economic meltdown in late 2008, when government leaders lobbied against travel as a frivolous activity, Duffy was CEO of Maritz Travel, with AIG as a customer. As millions of dollars in potential travel revenue were canceled, she kept asking herself: “Why doesn’t the government, why doesn’t the media, why don’t people understand that what we do matters? We’re a real industry with real jobs.”
According to the World Travel & Tourism Council’s 2010 report, the travel and tourism industry employs 235 million people globally, a number that will rise to 300 million by 2020, with $5.8 trillion in GDP and $1.2 trillion of investment in travel and tourism. Duffy told the agent audience that U.S. residents spent a whopping $654 billion on travel in 2010, with more than 1.5 million in leisure trips taken. Nationally, 7.4 million jobs are directly generated by travel.
The cruise industry contributes $40 billion to the U.S. economy and 350,000 North American jobs. CLIA member lines carry about 16 million passengers annually, about three quarters of those from North America. Today, CLIA has 100 executive partners, 16,000 member travel agents as well as 26 member lines.
Yet, despite those hefty numbers, Duffy lamented how the industry is often portrayed. “In the U.S., travel has not been taken seriously as an industry,” she emphasized. “We’re one of the few countries that doesn’t have a Cabinet-level position or a tourism secretary to promote travel and tourism at the [highest] level of the administration.”
In addition, governments seeking funding continue to assess more taxes and fees on travel services, she said. And while security screenings by the Transportation Security Administration (TSA) are certainly necessary to protect America, at times, the security practices are less than customer friendly, Duffy noted.
Agents in the audience peered incredulously at a slide Duffy showed of 2009 results from a U.S. Travel Association survey. It measured the perception of travel and tourism by those “inside the Beltway,” a term for the Washington, D.C., policy makers and government leaders who typically live within the 25-mile perimeter of the Interstate beltway that encircles Washington, D. C.
The survey asked these influential Washington insiders to rank America's industries in terms of their influence in Washington D.C. In other words, Duffy said: “Who’s got a seat at the table [when important issues are evaluated and legislative and policy decisions made]?
Eighty percent cited the financial services industry, 78 percent listed energy and 49 percent mentioned manufacturing. Food and beverage and entertainment followed. Travel and tourism was at the bottom of the heap with only 19 percent.
The challenge, said Duffy, is clear.
“People see our industry as large, we employ a lot of people, but they don’t really know how big we are and they believe that what we do is kind of frivolous," Duffy said.
She said that the thought is that technology eliminates the need for face-to-face contact and meetings can be done over the Internet. But she also acknowledged that as an industry, that’s “our own fault.” She said the travel industry never took the time to be in D.C. consistently for government officials— and to work to educate them.
However, she said, the good news is that the industry making progress. The Travel Promotion Act of 2010 creates the first ever public-private partnership for the U.S. to market itself internationally.
“It is hard to believe that we are one of the few countries that did not already have that in place,” Duffy said.
Visa waiver is another issue that needs attention, she said, along with more research that validates the size of the travel industry, the number of jobs, and the revenue generated through taxes that travelers pay. Duffy noted that travel and tourism is one of the few industries that actually touches every Congressional district in the country.
“The U.S. Travel Association has launched the Power of Travel Coalition as a way to begin to get the grass roots people who work in this industry galvanized and together to make sure that we are telling our story to those local representatives that we have in our hometown,” Duffy said.
In addition, the Blue Ribbon Panel on Aviation Security just concluded its work two weeks ago, talking about opportunities that exist to improve the travel experience, while continuing to maintain security for travelers. In discussions with Janet Napolitano, U.S. secretary of home security, and her team, Duffy feels that the government is looking for the industry’s input in how to make things better.
“They want to make it better,” said Duffy. “They want to hear from us.”
Duffy suggested to Napolitano that TSA agents say “welcome home” to U.S. citizens and “welcome to the United States” to those from abroad. “Something as small as that makes a difference,” Duffy said.
As CLIA’s leader, Duffy pledged to strive for ongoing dialogue and to have a seat at the table for upcoming policy decisions and government actions that impact the travel industry. But she also said it's important for the industry to proactively respond to such crises as natural disasters across the globe, political turmoil, an economy still in recovery and oil price increases.
Duffy also cited the increasing trend of tourism being used as an onerous weapon—as in the case of Arizona when political decisions were met with tourism boycott. All these factors combine to send a message that “you’re never really out of the woods,” stressed Duffy. “We have to stay vigilant, we have to be proactive, we have to monitor what’s happening all over the world.”
Trends beyond the industry? Societal shifts have changed the look of the marketplace, she said. Right now, there are five generations in the workplace. Baby boomers are not retiring, so there aren’t as many jobs for younger people. And, Gen X and Gen Y consumers are moving back in with their parents to live.
Corporations have cut jobs and are unlikely to bring back all those jobs, Duffy believes. The result is a societal shift into a “freelance nation,” in which people of all generations increasingly see themselves as entrepreneurs and their own corporation.
She says there are more independent contractors and more people working from home. Technology has provided the impetus for 24/7 access. She also believes corporations are becoming more socially responsible. Consumers want value, not excess, and they too want to give back to society.
So what’s the outcome?
“If you think back to the ’80s and ’90s, it was all about ‘how much can I accumulate, how much stuff do I have,’” she said. Today, people instead are asking “Is that really what’s important?”
Duffy said the outcome is a new frugality. It isn’t that they are against luxury, she said, it just means that they want to value or a great deal, not excess. And they want to give back to society.
“Attention and time has become the new currency,” Duffy said. “Everybody’s busier.” People are also looking to create memorable experiences when they spend their time.
Today, travel has become more accessible to more people, and at the same time, more important to people, she said: “The boomers have done a great job showing their kids the world.”
What do today’s consumers want? They want a social and emotional connection to the brand. They want trust, and they want transparency. Consumers are looking for greater meaning into where they spend their time and money.
Societal shifts are also accelerated and enabled by technology, according to Duffy. “We all know social media is here, it’s not going away,” she said. More than 5 billion apps were downloaded in 2010, and every six minutes someone checks their mobile device.
Fifty percent of 8- to 12-year-olds have a mobile phone. In addition, 5.2 billion people have a mobile device.
Duffy also asked the agent attendees to think about changes over time. In the 1500s, books and newspapers arrived. In the 1890s, the first voice recordings were made. In 1910, movies were introduced. Radio arrived in the 1920s and television in the 1950s.
Duffy said that, “In 2000, it is all about mobile.” She said that in the UK, 67 percent of the population “sleep” with their mobile device.
Mobile applications allow the industry to respond quickly in times of crisis and to capture the attention of the consumers at the point of the consumption. Mobile applications are used for reality television voting, political campaigns and augmented reality.
From a cruise perspective, technology allows the customer to focus more on the pre- and post-cruise period, not just the vacation itself— as cruisers relish every aspect of planning their trip and then share pictures and discuss experiences upon their return.
“In the Old World, having the knowledge and information was what created power,” Duffy said. But in the new world, she believes those who have power “share and push out knowledge” and understand that creates power through the creation of a social community.
Duffy said CLIA will continue to elevate the profession of being a travel agent through professional development and certification. In 2010, CLIA put on 30,000 training events, trained more than 30,474 agents took training and certified 1,200 agents.
CLIA member lines also will continue to give agents new products to sell. Forty new ships entered or will enter the CLIA fleet between 2009 and 2011, with 14 more new ships launching between 2012 and 2014.
Duffy pledged that CLIA will work closely with other travel associations, help agents leverage technology tools and do more to ensure the next generation comes into the travel industry, In addition, the cruise industry will continue to work on health, safety and environmental issues, she said.
“We’re not just in cruising, we’re in the maritime industry,” Duffy said.