Arnie Weissmann
As Mark Zuckerberg faced Congressional committees last week, explaining changes Facebook might make in its approach to data, advertising and marketing, I sat opposite Martin Nydegger, CEO of Switzerland Tourism. I asked him about changes in his approach to data, advertising and marketing.
I was curious about the General Data Protection Regulation (GDPR), European Union rules that go into effect May 25 and require companies to seek explicit permission to use personal data. Because it also applies to enterprises operating outside the EU, it's a de facto global regulation.
GDPR comes at a critical time for Switzerland. After three
low-snow seasons, the winter of 2017-18 blessed the country with abundant
powder.
About half the Swiss industry's traffic is domestic, but the
No. 1 international source market, Germany, plunged a jaw-dropping 50% from
2011-2016, due primarily to the weakening of the euro against the Swiss franc.
Skiing in Switzerland became much more expensive than shredding the slopes in
Austria, France or Italy.
But this season's snow and a slight strengthening of the euro
helped a bit -- in 2017, German visitation appears to be up 1.1%.
There are additional challenges. Baby boomers, who as a generation had shown great enthusiasm for the sport, are aging out, and the millennial demographic has demonstrated only lukewarm interest. Climate change is shortening winter seasons and raising snowlines; the Swiss government has advised all towns below 4,500 feet that are economically dependent on skiing to diversify their economies.
But pointing to the "enormous" snowfall this year, Nydegger said that the impact of climate change is in some ways advancing more slowly than predicted and that, long term, Switzerland has a distinct advantage because its resorts are, on average, at higher elevations than those of European competitors.
U.S. arrivals are still very strong, continuing trends that have seen an increase of almost 50% in the past eight years, with a parallel rise in average daily spend.
As some traditional markets have slowed, the Swiss have creatively cultivated new business, and it's paying off. This past year saw more Arabs than Italians, more Indians than Dutch, more Chinese than French.
"We have a 100-year heritage of tourism that followed a fairly steady approach to market share," Nydegger said. "It's easy to welcome Americans; we like the same things. But we need to adapt to [emerging markets]."
One such adaptation can be seen in the country's courtship of India. Just as some destinations have taken advantage of exposure in Hollywood films, Switzerland is exploiting its setting as a favored Bollywood backdrop.
"We saw a 23% increase from India," Nydegger said.
That market is particularly attractive because its high outbound season coincides with Switzerland's low inbound. "The Hotel Terrace in Engelberg closes down to other nationalities for Indian groups in April, May and June," Nydegger said. "Indian chefs are flown in, and the focus is completely on making Indian guests comfortable."
Switzerland's top destination marketer has found benefits in catering to other nontraditional markets. Gulf Arabs "don't book rooms; they book floors," he said. "They tend to travel in big clans and have enormous budgets."
Switzerland has always planned campaigns around winter and summer, but climate change has elongated the fall and prompted Switzerland Tourism to "upgrade autumn as an independent season, rather than as summer's little brother."
To that end, the tourism board is encouraging additional activities, festivals and events.
(I humbly suggested that, because absinthe was formulated in Switzerland and recently became legal there again, they devise an "Absinthe Makes the Heart Grow Fonder" festival. Nydegger politely said he'd take it under consideration.)
The organization is also using a more granular approach to summer marketing. Those who love to spend time outside have been segmented into (passive) nature lovers and (active) outdoor enthusiasts, with different approaches and collateral aimed at each.
Which brings us back to data.
"We had surveyed guests [for years] and dove into the data to create those segments," Nydegger said.
Will GDPR hinder the creation and deployment of campaigns going forward?
"As an organization, we will be 100% compliant and share [best practices] with smaller Swiss [destination marketers]," Nydegger said. "Everyone will suffer, but we are among the lucky ones. The companies that sell data, they're in big trouble. The future is about permission marketing. The question is: What do you do with data already collected? We have to go back and look at how we acquired it."
Alex Herrmann, Switzerland Tourism's director for North America, had joined us, and he added that while digital marketing is important, "we believe in offline." To target the active outdoor enthusiasts, for example, he has developed a partnership with bike-share programs in five cities.
Solid relationships with travel agents and tour operators have also been crucial. "We saw the rising popularity of riverboat cruising," Herrmann said, "and we don't have it in Switzerland. But working with travel advisers and tour operators, it has become an important [contributor], through pre- and post-trips."
For a period after GDPR kicks in and Facebook reconfigures, we might see that what's old is new when it comes to marketing. As a result, travel advisers, whose knowledge about clients is often based on interpersonal, in addition to digital, relationships, may benefit.
Even so: Don't let your digital and data skills get rusty.
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A previous version of the column reported that inbound
German traffic to Switzerland was down 50% in 2017. The drop occurred during
the years 2011-2016.