The Challenges of Selling a Hotel on the Mexican Pacific Coast
By Eliane Barradas Director of Sales, CasaMagna Marriott Puerto Vallarta Resort & Spa | November 03, 2013
Inspired by the beauty of its mountains and its golden beaches, I decided to continue my professional career as sales director in Puerto Vallarta with a return to the four-diamond beachfront CasaMagna Marriott Puerto Vallarta Resort and Spa. My foray into the hospitality industry began with my first job at the JW Marriott Mexico City and during my career thus far I have spent time in numerous properties around and outside of Mexico including the Marriott Ixtapan de la Sal Hotel and Spa, Lisbon Marriott Hotel Portugal, Airport Marriott Hotel Mexico City and most recently the St. Regis Mexico City. Having spent the majority of my career in major urban cities, moving to the coast has been an enlightening experience, both personally and professionally. Just a couple of months living in this beautiful area, I found that despite being a world-class destination, the coastal city is facing big challenges when it comes to selling this picturesque getaway locale.
In 1964, Puerto Vallarta became famous worldwide thanks to the film Night of the Iguana, written by Tennessee Williams and directed by John Hudson it had a tremendous case with with Richard Burton, Ava Gardner and Deborah Kerr as the principal actors. Men and women, love and lust, ruin and redemption all come together in this enchanted Mexican village and helped put Puerto Vallarta and the surrounding area on the public's radar.
The Pacific coast, including Puerto Vallarta and Nuevo Vallarta, are today more popularly known as the Mexican Riviera. In recent times the area has faced a complete transformation; once a group of native villages some decades ago, it is now among the major tourist destinations in the country, offering gorgeous beaches, excellent gastronomy, a large selection of natural and adventure attractions, active nightlife, golf courses and upscale resorts and spas.
Over the years, national and international tourism increased in Puerto Vallarta with 2006-2007 being the "Golden Age," representing 50% of the economic activity. Thousands of Canadian and American citizens chose Puerto Vallarta (mainly from October to April) as a holiday destination, taking advantage of the ideal flight connectivity from the West Coast. In addition, Puerto Vallarta is one of the top travel destinations for the LGBT community as it offers an array of options that cater to and support the LGBT segment.
However, the tourism boom that peaked a few years ago is now a hard goal to achieve. The area as a whole has struggled to keep the steady demand once seen. I believe the following reasons are causing a less than desired result for our travel industry.
- We continue seeing a decrease in the available airline seats demanded from the US Market. In addition, flights to the area are more expensive compared to similar destinations. On the flip side, domestic travel has increased 3% year by year according to the Mexican Tourism Office.
- Room inventory is increasing, but tourism demand is decreasing. Hoteliers along with tourism officials need to work together in order to promote the Pacific Coast while balancing the hotel supply with the tourism demand. In 2014 alone, around 500 rooms will be added to the Puerto Vallarta area and 900 rooms in the Nayarit area. Due to this stream of inventory, hotel pricing is very aggressive and some hotels are on permanent sale with irrational revenue strategies.
- Destinations in the US are becoming more affordable, which causes a trend for Americans to travel domestically. Many now turn to closer locales for their leisure time. In addition, meeting planners, once a major part to drawing visitors to the area through corporate events, find domestic retreats are even more affordable.
- The increase of all-inclusive hotels with very low rates ultimately damages the tourism climate. Such resorts are taking market share away from non-all-inclusive hotels that have to compete for the same market with an aggressive pricing that affects profit margin.
- Bad press stemming from violence and drug trafficking is creating a negative perception of Mexico. Many US travelers are deterred from visiting our beautiful region because of the news reports they read. In reality, Puerto Vallarta has experienced less drug-fueled violence than many US cities such as Chicago and New York and is safer than just about 90 percent of the cities in the US. Still, a negative public perception remains.
How can we succeed against this struggle? What does future looks like? Despite the challenges, there are positive indicators, which bring us hope and fresh air.
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