From all-inclusives to un-inclusives: An evolving sense of value | TravelResearchOnline

From all-inclusives to un-inclusives: An evolving sense of value

Though no one can predict the impact our current topsy-turvy economy will have on the travel industry, I have faith that the all-inclusive vacation – as a value through boom and bust – will endure. The birth of the all-inclusive during the oil crisis in the 1970s supports my optimism. Tourism in Jamaica was sluggish and Prime Minister P. J. Patterson asked me to create something capable of jumpstarting the stalled industry. Fast-forward 35 years and we seem to have come full circle: oil dependency, financial upheaval and political change. Yet whatever the condition of the economy, the appeal of the all-inclusive vacation remains the same. The one-price-buys-all model is a smart, value-driven choice that offers a distinct advantage: it eliminates most if not all of the financial risk and surprise from a vacation.

Agents today have to be psychologists, counselors and party planners. To book a successful trip, they have to work closely with clients to determine what best suits them, and make sure the entire party has a memorable time. The surest way to fulfill their dreams – and not break the bank – is with an all-inclusive. The majority of this genre of resorts offer, not only food and drink, but also all sports – including motorized water sports. Many also include airport transfers and do not permit tipping. Higher-end properties also include scuba diving and golf greens fees in the package. Dollar for dollar (while not nickel and diming vacationers), the value adds up.

From the low- to high-end, all-inclusives cater to the desires of most categories of travelers. A dominant sector in the travel marketplace, all-inclusives first exploded with niche products: family resorts, adults-only playgrounds, and couples-focused hotels. Now, future growth lies in new destinations. Look at what the all-inclusive resort did for the Dominican Republic and Curacao. Resorts popped up left and right, bringing streams of travelers to the islands, resuscitating floundering economies. The new frontier today is further south: Latin America. Brazil and Panama are the next hot spots, so I’d recommend forward-looking agents start boning up on these destinations now, as clients are likely to start asking about them if they haven’t already. SuperClubs alone has Breezes and Starfish resorts in Brazil, and will double our Latin hotels with two additional Breezes properties in Panama and Brazil in 2009.

While the U.S. legal system makes it difficult for all-inclusives to open in the U.S., I’m confident the U.S. embargo on travel to Cuba will eventually be lifted, creating a huge all-inclusive travel destination for Americans in the near future.

But there is no such thing as a one-size-fits-all vacation. Despite their devoted audience, all-inclusives are not for everyone. Consumers today are very demanding. They all want more choices and greater value. Just as more luxurious hotels are proliferating worldwide, there is also a trend today toward limited service hotels – a clean and comfortable room with good services and high speed Internet at a very reasonable price. I call this the “un-inclusive.”

Variety is the spice of life and these hotels are steadily becoming more popular. It’s like ordering à la carte instead of going with the buffet or prix fixe menu. Rooms On the Beach hotels are an example of this. We opened the second one in Negril, Jamaica, in July at 100 percent occupancy. With nightly room rates starting at just $100 including continental breakfast, occupancy levels are hovering at 80 percent. This is a global trend. Hotel So opened in September in Christchurch, New Zealand, to much fanfare. Designed for budget-minded, environmentally-responsible travelers, this concept hotel gets basics right: hip, practical-design en-suite rooms with double insulated walls, MP3 compatible speakers, wireless broadband (free), and flat screen TVs. The demand for a stripped-down, yet appealing product is being met with new builds worldwide.

I liken this un-inclusive phenomenon to the airline industry today. Airlines are struggling with fuel costs and looking for new ways to make up for lost revenue – so they won’t have to raise fares any higher. The same à la carte concept is being applied, with major carriers like American, United and Continental charging for checked bags, while others like Delta charge for snacks, US Airways charges for soft drinks, and JetBlue sells $7 pillow kits. You only pay for what you want.

Interestingly, this minimalist approach also plays to the green spirit of the times. By delivering only what is desired, we reduce consumption, and in a way that is sustainable.

So how do the agents sustain themselves – and make their businesses thrive – given the current economic climate? I strongly believe value is the most important decision factor in travel today. Even in harsh times, people need and want vacations. They may shave off a few days or stay closer to home, but they still yearn to get away. To close the sale, travel agents need to stress the value proposition of the holiday choice. All-inclusives offer the very best value with the one-price-covers-all model. Whether in an up or down market, the same top-shelf liquor is served and the same watersports are included. Guests are all VIPs and don’t have to reach into their wallets for anything on property, even tips. If, though, these customers are looking for just a room this time around, I can appreciate that, and a savvy agent will too. If satisfied, they will come back. The bottom line for customers is getting the most bang for their buck – and as long as it’s in line with their realistic expectations, we should be able to give it to them.

For 35 years, SuperClubs Chairman John Issa, the pioneer of all-inclusive resorts in Jamaica, has provided superlative vacations purchased for one up-front price, with no hidden charges and no tipping allowed.  Accommodations, meals, drinks, and all land and water sports are not only included – they are unlimited. Since each of his 11 resorts has a different personality, visitors can easily match their own interests and budgets.  His SuperClubs portfolio includes: six resorts in Jamaica, one in the Dominican Republic, one in the Bahamas, one in Curaçao, two in Brazil, and two additional properties in Panama and Brazil opening in 2009.

  2 thoughts on “From all-inclusives to un-inclusives: An evolving sense of value

  1. Steve Cousino says:

    John, it’s great to see you here at TRO! I have always enjoyed SuperClubs’ products and try to recommend them whenever possible for my clients. Many of my clients love the all-inclusive concept, and they like the variety of atmospheres possible through SuperClubs.

    My only complaint about AI properties is that there are so many of them that sometimes I get overwhelmed with them and have a hard time recommending one to a client versus another; this is more prevalent in Mexico and Jamaica, but SuperClubs helps make that easier.

    Keep up the great work, and thanks for supporting the agent community!

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