1

UK Market PresentationJuly 2010

2

3

Key ActivitiesKey Activities

July 2009 to presentJuly 2009 to present

4

5

Remainder of 2010 Remainder of 2010 ActivitiesActivities

6

“Macau Specialist” Sign-up Promotions Selling Long Haul TTG Win fam places

7

AITO Summer Press BBQ

Evening event for Association of Independent Tour Operator members to meet and network with travel media

Attendance from around 40 AITO members and 80 journalists

8

National media promotion

National press on and offline Tour operator partner(s) Special late holiday deals

9

PATA Academy

New online training scheme for PATA members

One module for each destination member

10

Tour Operator Co-op Marketing

Joint activity with HKTB where appropriate:

Virgin Holidays Hayes and Jarvis Travelmood Saga Holidays Thomas Cook Signature

11

MGTO/HKTB MICE Event Evening workshop and networking for MICE buyers

Joint HKTB/MGTO function

Presentations

12

ABTA Convention 2010 - Malta Senior industry meetings and networking

Media reception

13

Online/SEM campaign

Online travel specialist partner

SEM element

Online tactical element

14

Group media fam with HKTB Two-centre Macau and Hong Kong Food theme

15

How to Sell Macau supplement Produced in conjunction with key trade title

Supported by partner advertising to offset cost

Launch at WTM

Cross sell Macau Specialist Scheme

16

World Travel Market

Bigger show, re-configured layout ... MGTO now positioned between Hong Kong and China

Circa 50,000 global visitors

17

World Travel Market – House of Commons Dinner Long term partnership with PATA 50 trade and media guests

Sourcing new MP host due to change of government

18

C&IT Agency Forum

50 buyers, 25 suppliers

Two day pre-qualified appointments with key MICE agency buyers

19

Taste of PATA London event at Borough Market

Participating destinations showcase via food and entertainment

MGTO will participate jointly with HKTB

20

20112011

21

UK Outbound MarketUK Outbound Market

22

UK Outbound Market – 2000 to 2009

2009 Outbound:- 15%

Twelve months to April 2010 Outbound- 13%

23

UK Outbound 2009 – purpose of visit

Business visits -17% Holiday visits -16%

24

European Outbound Market (IPK International)

25

First Half 2010 – “The Perfect Storm”

April – Ash cloud

May – General Election

June – World Cup

26

UK Market Profile

85% arrive by seaNo marked seasonality

86% stay four and five star – five star stays increasing

53% stay overnight

27

Top destinations combined with Hong Kong 2004 (holiday visitors)

28

Top destinations combined with Hong Kong 2007 (holiday visitors)

29

Top destinations combined with Hong Kong 2009 (holiday visitors)

30

Market EnvironmentMarket Environment

31

It’s been a good year for …

It’s been a bad year for …

32

Economic Recovery extremely fragile

GDP grew by only 0.3% in first quarter of 2010

UK’s growth forecast for 2011 downgraded to 2.6% from that given by the last government of 3% to 3.5%

Interest rates at historic low of 0.5% since March 2009

Inflation up to 3.7% in April – above 2% target

Unemployment at 8% for 1st quarter, highest since 1994

33

Pound beginning to strengthen against Euro but dollar still stronger The toughest package of tax increases and spending cuts in a generation unveiled by new government on 22 June

Government intends to cut the giant £155bn deficit and “balance the books” by 2016 VAT will rise from 17.5% to 20% from January 2011

Leaked figures suggest up to quarter million job losses per year for next five years

34

Political

General Election on 6th May resulted in “hung Parliament”

Conservatives and LibDems have created Britain’s first coalition government since World War II

New Prime Minister, David Cameron (Conservative) supported by LibDem leader, Nick Clegg, as Deputy PM

Promising “a new kind of politics”

Are wasting no time in dealing with debt crisis

35

Market TrendsMarket Trends

36

Consumers protecting main summer holiday at expense of multiple breaks

Some trading down (hotel class, number of nights etc)

Company failures and job insecurity driving consumers back to security of high street agents

Aggressive pricing and deal-led market as consumers look for bargains Short notice booking Environmental awareness slipping down agenda

37

Reduced flight capacity to 59 non-stop flights between UK and Hong Kong each week (Cathay Pacific x 28, British Airways x 14, Virgin Atlantic x 7, Air New Zealand x 5 Qantas x 5)

Tour operators sticking with “tried and tested” destinations

British Airports Authority traffic dropped 22% in April

British Airways industrial problems continue

Ash cloud crisis appears over ... for now

38

Air Passenger Duty increased from November 2009 – second increase due from November this year

New government have promised to switch from per person tax to per plane tax, but no timing given in recent budget.

Third Heathrow runway cancelled

39

One year on …

… little did he know how bad it was going to get!

40

SWOTSWOT

41

Weaknesses and Threats Increasing unemployment as government tackles UK debt

Lack of direct air access from UK

Long distance, high cost to reach Macau

High UK marketing costs make it expensive to put Macau “on the radar”

Further increase in Air Passenger Duty from November

Good summer weather (so far!) may keep people at home

42

Strengths and Opportunities Macau remains relatively new and interesting compared with other regional destinations

World class infrastructure with constant flow of new product and new partners to work with, eg Mandarin Oriental

Closer ties with HKTB allows budget stretch

Ethnic markets, including 2nd and 3rd generation

Some key operators still do not yet feature Macau

43

Market Strategy Market Strategy 20112011

44

Harsh economic conditions will necessitate a further “tweak” to strategy in 2011 in order to reflect the

challenging market ...

45

Distribution ... focusing on (a) the remaining Tier One key players (b) Tier One operators that only have Macau as a day trip and (c) Tier Two operators.

Targeting ... demographic groups and niche segments least affected by the spending cuts/tax increases, working with partners to stretch reach and impact.

Conversion ... through price-led and added-value offers to overcome the fragile economy and consumer “belt tightening”.

46

Target Segments

Consumer London/South East Student travel Cruise Honeymoons Ethnic Stopover/VFR

Trade Product Agents/reservations Owner/MD

MICEAgenciesCorporates

47

Key ActivitiesKey Activities20112011

48

ConsumerConsumer

49

PR

Increased focus to overcome high cost of consumer advertising and widen reach

Travmedia event sponsorship - these evening cocktail party attended by up to 180 journalists/PRs. MGTO presentation and communicate key messages

radio interviews about the attractions of Macau, news updates and event information and syndicate these to radio stations around the UK

50

Online/social media

Social media as a means to engage with journalists and highlight key news and events

Online element throughout all consumer activities - both awareness conversion, inc SEM

regular communications on the key social media sites (including Twitter)

51

Consumer advertising

Follow up to London taxi campaign

Affluent London market, both residents and commuters

Outdoor/ambient options such as digital escalator posters selected by station/route

52

Co-operative partnerships

Crucial to stretch budget and increase impact

All the new operators featuring Macau will be supported to drive sales conversion eg highly sought-after annual Sunday Times travel calendar with Hayes & Jarvis

Airline partnerships

London offices of new Macau hotels egMandarin Oriental and, when appropriate, Shangri-La

53

Multi destination activities

Hong Kong Tourism Board will remain a key partner due to its gateway position

we will aim to work with CNTO where possible

follow-up activities with Guangdong following recent roadshow

Tourism Australia and Australian states re kangaroo route stopovers

54

Radio

Joint project with HKTB

On air promotion with a London radio station selected for audience profile eg Magic FM (weekly audience over 2m) weekly.

Competition format, presenter reads, live broadcasts, online support

55

London Chinese New Year Celebrations

250,000 visitors in 2010

In around around Trafalgar Square

Cultural performances and culminates in a fireworks display.

Current sponsors include Hong Kong Tourism Board and Cathay Pacific

56

TradeTrade

57

Distribution

Remaining “Tier One” targets including: Kuoni Gold Medal Travel Tier Two operators

Day trip operators including: Wendy Wu Tours

Ethnic operators targeting 1st, 2nd and 3rd generation Chinese in the UK

58

Trade – Online Training Scheme

As well as face-to-face training we will proactively drive membership of the Macau Specialist online training scheme via promotions and incentives throughout the year.

59

Trade – Agent Training Video

Trade promotion in conjunction with TTG or Travel Weekly for agents to win places on a fam to Macau

During the fam they will make a UK specific Macau product training video

Distributed online via media website, traveldaily.tv trade and used by MGTO UK office for training.

60

Fams

At least one group fam trip aimed at tour operator product managers to support new distribution.

Retail travel agents/tour operator bookers will be targeted to increase conversion

Cathay Pacific Mega Fam

61

World Travel Market – November

Maintain stand position next to HKTB/CNTA

Consider joint at-show promotion

Work with PATA on Voyage of Discovery

62

World Travel Market – PATA Dinner

Continue partnership with PATA Maintain Monday evening forcompetitiveness

Review format

63

Trade round table Trade event at L’Atelier des Chefs in London

Inviting celebrity pastry chef and journalist Dan Lepard to host and demonstrate how to cook pasteis de nata.

Engage senior trade figures

Moderated by Travel Weekly editor, Lucy Huxley

Media coverage inTravel Weekly

64

Other

Industry conferences

Trade e-newsletter

Travelbiz Directory Diary

Trade PR

65

MICEMICE

66

Networking

Key industry bodies and associations such as Eventia, MPI etc

Capitalize on Becky Smith’s board position with MPI to strengthen relationships with key buyers and media to establish Macau as a prominent MICE destination. Maintain our relationship with “The Oysters” and participate in their annual summer event

67

Sales and Education

Sales calls E-newsletters Media and buyers fams

68

HKTB Co-operation

Co-operation except in the area of large conventions

For Hong Kong, adding a Macau element offers something new and fresh

For Macau, Hong Kong gives the security of being linked with an established destination and overcomes lack of direct flights

We will therefore work once again with HKTB on a joint MICE workshop/networking event as well as fam(s)

69

Media Partnership

Conference & Incentive Travel Magazine

Package of Macau promotions to their readership, including:

• destination guides

• participation in one of their annual agency/corporate forums

• editorial

70

Other

PR - maintain close relationships with the highly influential MICE segment media for product updates, press releases, one-to-one briefings, fams Support MGTO presence at the key European MICE shows … IMEX and EIBTM. We do not recommend participation at Confex as experience has shown it is more relevant for UK and European destinations.

71

Thank youThank you