The Adrian Loveridge Column – Making it Cheaper to Travel to Barbados
Adrian Loveridge
The British Government is being urged to use the upcoming autumn financial statement to remove Advanced Passenger Duty (APD) altogether in a bid to ensure the UK remains attractive in a post Brexit world. Airlines UK and the Board of Airline Representatives (BARUK) in the UK have teamed up to appeal to Chancellor Philip Hammond. Airlines UK is the trade body for UK registered airlines which currently has 11 members, including British Airways, Virgin Atlantic, Thomas Cook and Thomson, all of which serve Barbados.
According to their website their objective is to ‘work with governments, regulators and legislators to promote the interests of UK airlines and with organisations across the sector to encourage long-term sustainable growth in aviation’. After a prolonged period of relatively low fuel prices the continuing crises in the Middle East is now forcing crude oil costs up. This combined with the Sterling currency fluctuation caused by the uncertainty of a Europe without the United Kingdom and the resulting near 20 per cent fall in value, when compared with the US$.
Most airlines buy forward to combat the increase in the cost of fuel, but the double whammy of a depleted value of sterling and the hike in Jet A1 fuel prices, which have to be paid for in US Dollars, have combined to create an almost ‘perfect storm’ in the UK airline industry.
Not surprisingly the airlines are looking from every possible viewpoint what could influence keeping fares down because they know higher seat costs will result in less people travelling.
The other unknown is the dreaded ‘I’ word, inflation. In 2015 the UK was rated as the world’s 9th largest exporter. Good news you would think, with a lower value of Sterling making British goods and services more attractive and less expensive. But the UK is the 6th largest importer, resulting in virtually all those products becoming at least 20 per cent more expensive.
In March 2017 the British Government will change the way it measures inflation, to include home owning costs. This will inevitably increase the rate of inflation, resulting in the Brits having reduced disposable income or in our interests, less to spend on foreign holidays.
From our perspective, there are a few positives on the horizon. Virgin have recently changed their frequent flyer or loyalty programme making it easier and quicker to earn sufficient miles to fly ‘for free’. In realty of course, when you pay the taxes and other add-ons to miles tickets, there is still a substantial cost, but it is at a lower price option than a full fare ticket or another way to upgrade your seat preference.
Sadly, our marketing gurus rarely consider frequent flyers in the overall promotional picture, despite some experts calculating that one in ten of our total visitors, use miles to reach us.
What cannot be disputed is that the majority of business people amass their miles to use on leisure travel and once again I call for a dramatically re-designed airport landing form which includes the question, ‘did you use your frequent flyer miles to reach us’?
Barbados Underground 
We can help avoid the real threat of our own uncontrollable currency devaluation by offering British travelers a 10 -15% discount. Need strategic leadership in the industry !!
LikeLike
Lee,
we already do this with our re-DISCOVER initiative (www.re-discover.com. The real challenge is to persuade the tourism partners to accept the concept of revenue control, just like most hotel chains, airlines, car rental and other sectors in the industry adopt and implement.
Some restaurants would rather have lots of empty tables at 6 or 6.30pm rather than offer a specially priced menu for early diners.
LikeLike
LikeLike
In regards to you re-discover Barbados initiative: I think it is a great idea, however in order for it to be successful it must be known about. Have the promoters considered a handout to arriving passengers along with non competitive touristic promotions, similar to Little Switzerland ?
LikeLike
Robert,
Yes we have considered, but are restrained by a very limited budget. All the background work is done entirely free of cost.
We have a little support from the BTMI, Scotiabank, Atlantis Submarines and a few minor sponsors but need additional funding. Having said that we currently have a full page ‘ad’ in the Thomas Cook inflight magazine that will be viewed by over 2 million captive travellers.
LikeLike
How can we(Caribbean region) with a straight face ask for a reduction in APD,when all of us are charging our own citizens such high taxes to travel within the region?
LikeLike
@Adrian
Robert makes a good point. It makes no sense to design a good program if there is not a greater awareness about the program.
LikeLike
David, ‘awareness’ costs money and I think it is amazing what we have done with so little.
LikeLike
I understand that there is a price for everything. No idea what it cost to put an ad in the inflight magazine, which is reaching a wide audience I admit. The audience you wish to contact is basically persons who visit Barbados. In my opinion the money may have been better spent locally targeting arriving visitors! I am not in advertising so just an opinion.
LikeLike
Agree, however to grow the program the sponsors onboard or potential must sponsors must be persuaded to support the program to move to the next level.
LikeLike
LikeLike
I will suggest that “frequent flyer miles” is about as old as the cellular phone. People collect points, dollars etc which can be used for travel in many ways. Loyalty credit cards are a big one. As are other ‘loyalty’ based products. So you likely wish to expand and ask “exactly how did you pay for airfare, hotel etc on this trip. Because it can be from different sources, which has nothing to do with FF programs.
LikeLike
Northern Observer. A good point, but I specifically mentioned air travel and I think its a given that MILES can be accumulated in so many ways just by selected a preferred method of payment. Which non-miles loyalty cards can be used to pay for airfare please?
LikeLike
All the credit cards. Example. I have a Bank Visa card where I get points based on my credit card spending. They have a program with expedia, (and others) where those points are converted to $$, and I can spend them on air, hotel, rental cars etc. My family trip at Xmas to St.Maarten the entire airfare is paid for by Visa credits, which had little to do with prior travel. The hotel partly by Air Miles, which despite the name, the credits were earned largely via multiple retail purchases and the redemption possibilities are like an old Sears catalogue, the rest of the hotel came from another credit card loyalty points.
All these loyalty programs are tied together at the hip.
LikeLike
Appreciate many small to medium sized businesses are run today via credit card. The suppliers hate it, but if it means getting a $60,000 invoice paid in 15 days, the CC cost is simply another cost of doing business. Many of these firms are racking up massive loyalty points, which can be used in many ways. Travel being only one. Some folks have it down to a fine art. Points pay for all groceries, petrol, in some cases insurance and car leases. They even transfer them to employees as a form of bonus payment!!!
LikeLike
The same discussion we have been having about the lack of transparency in Barbados regarding Sandals is also taking place in T&T. The difference is that T&T have FOI.
LikeLike
LikeLike