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Inviting your views on the refreshing of the Executive's tourism strategy for Scotland
MINISTERIAL FOREWORD
The tourism industry in Scotland has identified a 50% increase in tourism revenues by 2015 as its major ambition - I share that ambition. Our vision is to make Scotland a must-visit, must-return destination, where by meeting and exceeding our visitors' needs, our internationally competitive tourism sector makes a strong contribution to economic growth in every part of Scotland.
We want to talk to you about developing our strategy for how we achieve that. I am keen to talk to businesses, as well as with public and voluntary sector bodies, to get your views on this important subject. I am inviting you to help us update our strategy for tourism to allow us to meet the challenges ahead.
We have achieved a great deal since our first strategy was published in 2000. The volume and value of tourism in Scotland is increasing and there is much to be proud of. However, I do not need to tell you that this market changes rapidly and is becoming ever more competitive. We will need to move swiftly to respond to the changing needs of our guests and to maximise the opportunities offered by our environment, our heritage, culture and friendliness of our people.
I have asked the Scottish Tourism Forum to help us to communicate with businesses of all kinds over the next couple of months to help us update our tourism strategy. This short document invites your views on the issues facing the industry today, and on how we should respond to the changing marketplace.
Please read it, and please let us know what you think. I look forward to hearing about your views, and any answers you have to the questions throughout this document.
PATRICIA FERGUSON
Minister for Tourism Culture and Sport
Scottish Executive
31 January 2005
WHERE DO WE WANT TO GET TO?
To meet our ambition of 50% revenue growth for Scottish tourism by 2015, our vision is to make Scotland a must-visit, must-return destination, where by meeting and exceeding our visitors' needs, our internationally competitive tourism sector makes a strong contribution to economic growth in every part of Scotland.
Global tourism is forecast to grow by 4% a year and meeting this ambition would ensure Scotland shares in that wealth. The ambition is expected to be met by a combination of growth in numbers of visitors, and growth in the amount each visitor spends, as well as some increase in the proportion of international visitors.
Several workshops, involving representatives of the tourism industry and from the sectors which impact upon and benefit from tourism, were held by VisitScotland in August 2004 to focus thinking on a clear vision for the industry. This work tried to answer the question - what will Scottish tourism, and indeed Scotland, look like to our visitors when we achieve our ambition. The output from this work is presented in summary form below.
This document takes the vision sketched out above as a starting point to agree a common vision which the industry and the public bodies can all agree and work towards.
SETTING THE SCENE - WHERE ARE WE NOW?
Tourism activity is estimated to account for 3% of Scotland's economic output. Tourists spend billions of pounds during their visits to Scotland, and tourism related businesses employ around 200,000 people. Just under a quarter of tourism activity is generated by business tourism, which is especially important to the 3 largest cities, but benefits other parts of Scotland. Throughout the Highlands and Islands tourism supports almost 19,000 jobs, which account for 13% of total employment in the area. The sector is largely made up of small firms, with 95% of tourism companies in the Highlands and Islands employing less than 25 people.
Around 90% of our visitors come from the UK - with key markets being Scotland, North East England, North West England and Yorkshire. The US is our largest international market, followed by Germany, Australia, Canada and France. Although international visitors account for less than 10% of visitors, they spend more on average than UK visitors.
A recent VisitScotland survey of visitors' attitudes found that the most important things determining their choice of Scotland as a holiday destination were the scenery, the natural environment, the number of things to see and do and the attitude of the local people; North Americans also in particular are very keen on the opportunities to interact with local people.
The survey found 97% of visitors very or quite satisfied with their holiday in Scotland, with 96% of visitors having their expectations met or exceeded; North American visitors in particular have their expectations exceeded. The main improvements which visitors suggest are to the weather, prices, the exchange rate and accommodation, while a small minority also mention the quality of the food and public transport. The biggest disappointment is the weather followed by accommodation, although a significant minority do not identify any disappointments. The Scottish scenery is overwhelmingly the highlight of the holiday followed by Edinburgh and the Scottish people.
General sightseeing is the most popular activity for our visitors, followed by touring, visiting castles, houses and gardens and longer walks/hikes. The opportunities to pursue these activities are rated as 'excellent' or 'very good', particularly the opportunities for longer walks/hikes. The most popular evening activities are pubs/bars/clubs and taking in the sights. However, underneath these statistics sit a number of very successful "niche" markets for particular activities such as golf, cycling, other adventure activities, wildlife tourism or relaxing at spas.
WHAT PROGRESS HAS BEEN MADE?
The Executive's New Strategy for Scottish Tourism was published in 2000, aligned with Smart Successful Scotland ( SSS). This set out five priority areas for action: marketing; e-tourism; quality; skills; and restructuring of the public sector support structure. The strategy was underpinned by concrete objectives and actions which were set out in the Tourism Framework for Action ( TFFA) published in 2002. There has been considerable progress since the Strategy and TFFA were developed, and some of this is set out below. Although we would be glad to hear from anyone who thinks they need radical change to support the growth ambition, we think that the priority areas for action are still broadly right. That is why we are not thinking of rewriting our strategy, but rather just updating or refreshing it to take account of any changes needed.
Marketing: Spending more on marketing has been shown to increase visitor numbers. To support growth in the tourism industry VisitScotland's budget has been doubled by the Executive over the past 4 years, with most of the increase going on marketing. On average, for every pound spent on marketing, tourism revenues of £14.50 are generated - this is up from £12 for every pound spent in 2000. Extensive customer research showed that people link three basic qualities with the idea of Scotland. They see it as enduring in its history and culture; dramatic in its landscape; and human in the individuality and warmth of its people. The combination of these three elements is unique to Scotland and makes our "brand" unique. The VisitScotland marketing strategy uses these elements to promote five products - active, cities, freedom, business, and culture and heritage - which play to Scotland's strengths in these areas
Question 1 Is there more that could be done to improve the marketing of Scotland?
E-tourism: More and more visitors research and book their holidays online. We want to see Scottish tourism leading this trend and benefiting from it. Visitscotland.com was introduced to provide benefits to the industry by using leading edge web technology to enable visitors across the world to research and book a holiday in Scotland online. It has been set up as the national bookings website and contact centre, and since its inception in 2002, has generated £24m worth of business to the industry.
Question 2 What more can be done to meet the challenge of e-commerce?
Quality: VisitScotland has been given an additional £3m by the Executive to expand the range of its quality assurance schemes, for example into food quality, and to widen participation. Currently 80% of accommodation businesses in Scotland are members of the accommodation QA scheme, and VisitScotland aims to increase this to 90% participation in the serviced accommodation and visitor attractions sectors by the end of the 2008 scheme year. The Enterprise Networks have also co-ordinated the delivery of a wide range of training courses aimed at raising service standards in the industry. Since 2000 thousands of people in tourism businesses, and in schools and colleges, have participated in these courses. Both Enterprise Networks have enabled the private sector to invest in the highest quality at key destinations such as Aviemore and Lomond Shores.
Question 3 What more can be done to raise our game and improve quality throughout the industry?
Restructuring of the public sector support structure: There has been further work to join up public agencies who work with the tourism industry. The VisitScotland integrated tourism network will be in place from April, building on the strengths of the Area Tourist Boards and VisitScotland to deliver better service to businesses and to visitors. One important aspect will be closer co-operation between the Enterprise Networks and the VisitScotland network to ensure a seamless service to customers and the industry.
Question 4 Is there more which should be done to better join up public sector support for the industry?
Skills: The development of high quality business leadership and skills are crucial to success in a changing business environment. The Enterprise Networks have delivered a wide range of other skills support with owners and managers being a high priority. This has included conferences, workshops and seminars addressing key business issues such as quality management, marketing, innovation, e-business and recruitment and retention. Careers Scotland are now an integral part of the Enterprise Networks and provide careers advice, including on careers in tourism. Pride and Passion, an industry-led initiative to promote best practice in quality and skills, is now running, as is a new UK-wide Sector Skills Council for Hospitality, Leisure, Travel and Tourism (People 1 st) to represent the views of employers and to ensure the supply of training matches the needs of businesses. Springboard has expanded its operation in Scotland to attract more young people into the industry, supported by the Enterprise Networks. But skills gaps still exist, in situations where an employer judges an employee does not have the skills to do his or her job. These skills gaps in tourism affect one in three workplaces.
Question 5 How can we overcome the problem of skills gaps?
Question 6 How can we improve recruitment and retention of staff in the industry?
Other issues
In addition to these five priority areas, one further concern is around accessibility. The Executive's Route Development Fund has been very successful in increasing direct air links to Scotland. 13 new routes have been supported, including from Prague, Newark and Dubai. There are also new direct air services into Inverness airport, and seasonal services to Orkney and Shetland from Norway. Sunday train services have been introduced on the lines to Wick, Kyle and Thurso, and ferry links have been improved including the new Rosyth-Zeebrugge ferry and Tobermory to Kilchoan ferry services. But accessibility is still an issue, particularly for remote areas.
Question 7 What else can be done to improve access to Scotland, particularly to remoter areas?
THE FUTURE OF SCOTTISH TOURISM
World tourism revenues are rising steadily by 4% each year, but the number of destinations competing for the business is increasing. Competition is getting tougher as consumers become increasingly demanding. Consumers are becoming more affluent, and with growing affluence are becoming more sophisticated and expect ever-higher quality.
Changes in the population structure are likely to drive further change in tourism. An ageing population will mean post-family travellers will be a particularly strong market, combined with increasingly affluent younger people without children.
The nature of holidaying has changed with short breaks being the growth area for tourism in the UK as a whole. Greater numbers of people are taking several holidays a year, expanding the season.
Accessibility and convenience are crucial with budget airlines able to offer a wider range of European destinations within 3 hours.
Visitors' tastes are changing. Visitors are becoming more risk-taking, wanting to try new activities and have new experiences. One of the issues for remaining a must-return destination will be our ability to offer different experiences each time our visitors return. Many are seeking an "authentic" experience, with local food and culture becoming increasingly important.
Some of the questions these developments seem to raise for businesses include:
Question 8 Where will your key markets be coming from in 10 years?
Question 9 What markets should Scotland be focusing on?
Question 10 Are there niche markets which you will be aiming to target?
TELL US WHAT YOU THINK
The ten questions above are intended to stimulate discussion, not constrain it. The Scottish Tourism Forum is working with the Executive to communicate with businesses, and allow the views of industry and other key stakeholders to contribute to the updating of our strategy.
You can contribute your views as follows:
Trade Dialogue Meetings
Friday 18 February, Edinburgh International Conference Centre, Morrison Street, Edinburgh, 9.00-12.30pm
Tuesday 22 March, Thistle Hotel, Milburn Road, Inverness, 9.30-1.00pm
An online survey will also run on the Scottish Tourism Forum website http://www.stforum.co.uk between the dates of Wednesday 16 th February to Friday 4 th March.
NEXT STEPS
This short document is the beginning of a process. We will use your responses to help refresh our tourism strategy, with objectives and actions to take it forward and enable us to measure progress. Other developments through the year will feed into the process too. We are working with VisitScotland, HIE and Scottish Enterprise to review all the research and evidence related to the performance of tourism in Scotland and of our international competitors and this will feed in to the refresh of our strategy. We hope to publish the results of all of this work later this year. But to start it all off, we want to know what you think.
Tourism Team
Scottish Executive