The Mallorca tourism industry is desperate to get back on its feet again. But will this mean getting back to business as usual as fast as possible or using this unexpected time out to reimagine island tourism?
As Mallorca begins cautiously to relax lockdown measures, I asked Luis del Olmo, formerly of Melia Hotels and Resorts and now part of The Passionality Group, about what we can expect in the immediate and long-term future.
A Spanish national raised in Brussels, Luis has spent his entire career in the tourist industry. He was with Holiday Inns for 17 years, working in sales and marketing for Europe, the Middle East and Africa. From there, he went to Disney and played a key role in launching what became Disneyland Paris.
In 1993 Luis moved to Mallorca to work for Grupo Sol which became Melía Hotels International. He spent 25 years with the company, rising to become Executive Vice-President for Sales and Marketing.
On retirement, Luis became part of The Passionality Group which serves as a strategic growth partner to iconic and emerging hospitality brands.
Throughout his career with Melía, Luis was actively involved in government tourism-related activities and throughout the Balearics. Today, he’s president of the Balearic Tourism Innovation Cluster Balears.t, and on the board of the Fundació Mallorca Turisme.
Luis has worked in the tourism industry on four continents. He has a profound grasp of the nature of Mallorca tourism and he is actively involved in shaping the future of the industry here. Luis is the President of Itinerem.com which represents over 30 ‘Possessions’ – former agricultural hubs and now some of the finest collection of manor and rural hotels on the island.
I couldn’t have talked to a more informed person about Mallorca tourism. We spoke via Zoom.
Luis, how would you say the pandemic has affected Mallorca tourism?
It’s obviously been devastating, and the immediate drive will be just to survive. But we’re also being offered an opportunity.
Before the virus hit, the primary focus had been on quantity tourism not quality, resulting in what some people were calling ‘overtourism’. As a result, we had started looking at a different kind of tourism for the future.
Because of the pandemic, the population has been made painfully aware that our economy is around 80% dependent on tourism. We can criticize it all we want but it’s what many of us live from.
What will happen in the short-term, in the coming months?
At the moment, we’re not sure when tourism to Mallorca will start up again.
The first challenge to overcome is to do with health and safety. On Monday 11 May, we took the first step. The plan is to keep going through June and come to a ‘new normal’ by the end of June/beginning of July.
What does the new normal look like for hotels and tourist industry?
That’s what’s being worked on now. We’re looking at what sanitary measures need to be put in place.
A lot of standard operating procedures and protocols have been written in a very disparate way. I’m on the board of ITH, the Institute of Hotel Technology, part of the National Hotel and Restaurant Association in Madrid. We’re working out what the new protocols will be although, because we’re treading new ground, these will probably be adapted and changed step by step going forward.
Then they’ll go to the EU for review.
The question of when we reopen the frontiers and get airlines flying is linked to the sanitary issue and is also key to restarting tourism.
We’ve now come to the stage where the EU is definitely focusing on how we can start flying again, what the conditions are to allow tourist destinations to reopen and so on. Discussions are being driven, as you’d imagine, by the airlines.
For Mallorca, it’s also about getting as close as possible to the German market, which is where I believe there will be the first movement towards summer tourism. In Germany, tour operators and airlines are putting pressure on their own politicians. This seems to be getting results. We’re already receiving messages to suggest that Mediterranean destinations may well be open sometime in the summer.
Now we’ve all been forcibly reminded how dependent we are on tourism and we’ve seen a drop in GDP since the crisis began of almost 30%, it’s clear that something has to be done.
So, even if the 2020 season is going to be very bad, it’s good to know we’re going to be in the mode of people travelling and Mallorca receiving tourists as soon as possible. Whatever we can pick up will help.
How do you see the longer-term future for Mallorca tourism? It seems that luxury tourism for smaller numbers of people that has far less impact on the environment while bringing in healthy revenues for the island is one answer.
I totally agree.
Mallorca, Menorca and Ibiza are already heading in the direction of more upscale tourism. Companies like Melia, Iberostar, Riu have changed a lot, moving away from a mass tourism operations-led model to one that’s customer focused.
Could you explain the difference and why it’s important?
The large hotels on the island were originally basically financed by tour operators like Thomas Cook. After the war, they saw that Mallorca could be a prime destination. They knew the feeder markets in Germany, Scandinavia and the UK and put money into promoting Mallorca in these markets.
Because they were the ones bringing tourists over to Mallorca, they dictated what the product and pricing should be for the hotels and so on. This was fine for almost three decades and the first stages of tourism. During that time, the industry concentrated on perfecting the model: not losing a customer or a suitcase, transferring everyone smoothly. Great infrastructures and sanitary services. But they left it there. For far too long, the industry didn’t evolve.
Hotel customers were in the hands of the tour operators and the hotels lost control of them.
As other destinations with new, modern hotels began to compete with Mallorca and because there had been no real investment in the hotel product, pricing became an issue. This mean that many tourists chose Mallorca over other destinations offering sun sea and sand mainly because of price.
My conclusion is that we need now to become far more customer driven. I’m convinced that if we position the island correctly, we’re bound to attract the high-end tourist that pays for the quality of the product we deliver.
Don’t forget, Mallorca is still in the top five destinations in the world. It’s clean, safe and within easy reach of younger European tourists. In the past 10 years, boutique hotels in the historic Old Town of Palma have opened, along with more and more upmarket shops and restaurants. The island offers more of a quality experience than it did before.
We also have areas in the centre of Mallorca with charming historic villages, vineyards, olive groves and the beauty of the Tramuntana Mountains, a World Heritage Site. All these have the potential to be developed in a more attractive, controlled and sustainable fashion to make Mallorca a magnet for luxury tourism.
Realistically, how likely is this to happen?
I can tell you that the younger members of the families that built the hotels in the first place are definitely looking at ways they can change the model. The hotel chains, large and small, have generally accepted that the way to go is in the direction of sustainability.
Hotels are investing in certain areas to take them upmarket. This is why Melía has invested so heavily in redesigning Magaluf’s hotels and the area itself, as well as renaming the destination resort Calvia Beach. As a result, Melía’s revenues have improved dramatically. The company has also changed its strategy, selling direct to customers.
The success of this trend suggests it’s likely to continue to shape the future of Mallorca tourism.
Apart from luxury tourism, what other alternatives do you see as being viable?
At Passionality, we support new ventures and brands in hospitality that need access to knowledge to help them grow. That’s why we’re supporting the creator of The Itinerem Foundation, Diego Zaforteza. Together we’ve created a group of over 30 of the finest Possessions – manor houses and rural hotels – on the island, some dating back to the middle ages.
I got involved because I love Mallorca and am sure that the future for tourism to the island will be very different to how it is today. This project offers me an opportunity to help change the model directly.
There are also other properties that could become part of such a group but are falling down because families can’t maintain them. Investment and professional management could bring them back to life.
Most of all, we need to innovate while respecting past tradition. And we need to show the best of Mallorca, which has often been hidden away, in a planned, controlled and sustainable way.
Being on la isla de la muy muy calma right now, seeing far fewer cars and looking up at empty, pure blue skies inspires me to feel very positive about the future.