Executive Summary SA TOURISM’S STRATEGIC PLAN FOR THE 5...

Executive Summary

SA TOURISM’S STRATEGIC PLAN FOR THE 5-YEAR PERIOD 2012/13 – 2016/17 & HIGH-LEVEL ANNUAL PERFORMANCE PLAN & BUDGET FOR 2012/13

For presentation to The Select Committee on 6 June 2012

CEO: Thulani Nzima

Slide no. 1 © South African Tourism 2012

INDEX

1.

SA Tourism high-level Mandate, Government’s priorities, National Tourism Sector Strategy

2.

Strategies to Deliver on Outcomes

GOAL 1 Grow volume and especially aggressively grow Regional

Africa

GOAL 2: Domestic Tourism

GOAL 3: Marketing SA to become preferred Tourism Brand

GOAL 4: Quality Experience by both the International and Domestic

Tourist

GOAL 5: Improvement of Internal Policies, Procedures and Business

Processes

GOAL 6: To grow South Africa’s business events industry, and

continually improve SAT internal communications and live

the SAT Values

3. SA Tourism Key Performance Areas for 2012/13 Financial Year

4. SA Tourism Vision, Mission and Values


These 5 strategies have been converted to 5 Programmes

to comply with the National Treasury Annual Resource Plan template:

Programme 1: International Portfolio Marketing (purpose:to

increase international arrivals focusing on Africa’s growth in particular & spend by marketing SA internationally and aggressively grow Africa)

Programme 2: Head Office marketing (purpose: provision of support & toolkits for international regions to promote global visibility of SA brand &

to aggressively promote a culture of domestic tourism)

Programme 3: Grading of tourism products (purpose: promote word-of-mouth international and domestic marketing, following quality delivery

of experiences to visiting international and domestic tourists, through the grading of tourism establishments using global best-practice grading systems and business processes)

Programme 4: Head Office financial support (purpose: provision of real-time accurate financial information and business processes to ensure quality execution of approved Business Plans & Budgets while complying with policies and procedures (which will maximise

our chances to maintain clean audit reports)

Programme 5: Head Office administrative support (purpose: 1.provision of human resources, systems and structures to support execution of all approved Business Plans and Budgets 2. To fully implement the National Convention Bureau & achieve its KPA’s)


1. Government has set five key priorities for the next five years including the creation of decent work and sustainable livelihoods, education, health, rural development including food security and land reform and the fight against crime and corruption.

2. These five priorities have been converted into Government’s Medium-Term Strategic Framework which highlights 10 priorities and 12 outcomes over the MTEF period. Tourism falls under the Economic Sectors and Employment Cluster, one of the 5 Government clusters and its actions appear under Outcome 4: “Decent employment through inclusive economic growth”.

Linking to Governments priorities

Strategic Outcome Orientated Goal Number 1


Strategic Outcome Oriented Goal

1: To market South Africa in such a way that annual arrivals to South Africa increase to 12 068 030 by 2015 and 15 000 000

by 2020

Historic arrival targets and actual arrivals were as follows:•

2009 actual arrivals:

9 933 966 (3,6% increase over 2008 actual)•

2010 actual arrivals: 11 395 700 (14,7% increase over 2009 actual)•

2011 calendar year arrival target: 11 504 920 ( 0,96% increase over 2010 actual)

•

2012 calendar year arrival target: 11 922 201 (Tourist: 8 460 226) ( 3,6% increase in arrivals over 2011 target)

•

2013 calendar year arrival target: 12 343 315 ( 3,5% increase over 2012 target)•

2014 calendar year arrival target: 12 683 472 ( 2,7% increase over 2013 target)

•

At its September 2011 Board meeting the Board agreed that SAT must include tourist targets as well. Not having adequate data points (every 5 years for 1 year projected) to set these tourist targets, the following must be noted:

•

� The tourist arrival target is estimated using the annual average incidence of tourist arrivals within the visitor arrivals for 2009 and 2010. •

� This method of estimation is not reliable as the number of tourist arriving each month is variable. •

� The data on tourist arrivals is an estimation only and not targets.


Link to National Tourism Sector Strategy Targets

Arrivals – 15 million foreign arrivals by 2020.

Domestic tourists to grow by 3.4m from 14.6m in 2009 to 18m by 2020 and total trips to grow from 30m to 54m, with holiday trips increasing by 5m.

GDP – Increase tourism’s contribution to the GDP from an estimated R189.4 billion in 2009 to R499 billion by 2020.

Contribution of domestic tourism to GDP to grow to 60% from 52% in 2009.

Job creation – the tourism sector is committed to consolidating its efforts to create jobs and aims to create 225 000 jobs by 2020 – 177 000 in the tourism sector and 48 000 through direct government investment.


Tourist Arrivals to South Africa and the World, 2009 to 2011Tourist Arrivals to South Africa and the World, 2009 to 2011Tourist Arrivals to South Africa and the World, 2009 to 2011

Tourist arrivals to South Africa from long-haul markets decreased in 2011 following the strong growth in 2010 as a result of the World Cup

Long-haul Markets

Africa Air Markets

Africa Land Markets

All Markets Global Arrivals

There has been strong growth in all markets between 2009 and 2011, much faster than the global growth rate for the same period

Note: Africa Air Markets are markets where at least 60% arrives to SA use air transport; Africa Land Markets are markets where at least 60% of arrivals to SA use road transport. Long-haul markets include all countries outside of AfricaSource: StatsSA, Tourism & Migration release, SAT analysis UNWTO Tourism Barometer Jan 2012

Tour

ist

Arri

vals

(M

illio

ns)

9.8%

7.2%

9.1%

11.4%

10005.7%

6.3% 6.8% -5.6% 3.3% 4.4%14% 12.8% 21.4% 15.1% 6.5%% change y-o-y

CAGR 09 to 11


According to South Africa’s TSA, tourism’s directly contributed 3% to GDP in 2010 and accounted for 4.3% of total employment in the same year

MeasureMeasure 20072007 20082008 20092009 2010 2010 (provisional)(provisional)

Tourism direct GDP contribution

Contribution in R-million 59,781 67,199 68,831 80,249

% contribution 3.0% 3.0% 2.9% 3.0%

% change (year-

on-year) 12.4% 2.4% 16.6%

Persons directly engaged in producing goods and services purchased by tourists

Number employed 569,688 609,021 547,934 567,378

% share of total employment 4.2% 4.4% 4.1% 4.3%

% change (year-

on-year) 6.9% -10% 3.5%

Source: “Tourism Satellite Account for South Africa”, Statistics South Africa

Stats SA


MTEF allocation to aggressively grow arrivals from Regional Africa

Goal 1 continued……


Strategies to drive growth from the continent to meet NTSS targets

Increase arrivals and spend from Regional Africa to contribute to GDP and job creation.

In SADC , our market penetration is high but opportunities exist to promote repeat travel and to turn shoppers into holiday travel.

In Regional Africa Air markets, sizable opportunity exists to attract high value business and leisure traveller.

Setting up five marketing offices in key African markets by 2020.

Implementation of regional tourism programmes.


Overview – Air markets hub strategy

Summary of Opportunity Summary of Opportunity

Key Elements of Approach

Key Elements of Approach

East African Regional StrategyEast African Regional Strategy

Kenya is a relatively small market on a standalone basis, with only ~32k arrivals in 2010Serving additional EAC countries, such as Uganda and Tanzania would be beneficial

Combined arrivals of over 70kSimilar consumersGood regional integration and growth

Large regional market potential suggests the need to establish presence in the market rapidlyThis presence will start immediately by building key relationships (e.g., media, trade, etc.) to be leveraged for winning in these marketsIn the short term, we will start developing a fully-fledged regional strategy for the EAC

West African Quick Win Strategy

West African Quick Win Strategy

The Nigerian market is a large, and fast growing marketServing Ghana adds ~20k arrivals to the Nigerian marketArrivals from Ghana are growing fastCombined arrivals from Ghana and Nigeria represent ~81% of ECOWAS’s arrivals or ~70k arrivals

Our strategy in West Africa will include showing, in the short term, our presence in Ghana by developing critical trade and media partnerships and making very targeted investments in the marketIn addition, we will build our understanding of consumers and trade in Ghana through targeted researchFinally, we will continue to monitor the market’s growth and adapt our investment decisions in the long term

Central African Spillover Effect Central African Spillover Effect

The DRC market remains an investment marketIts high tourism potential, however, warrants increased investment Due to the proximity and high connectivity between the DRC and Congo-Brazaville, any activities in the DRC will have spillover effects into Congo-Brazaville

Limited additional effort is required in the short to medium term as effects will automatically spill over with no additional effort We will, however, continue to monitor Congo-Brazaville and other surrounding Central African states to leverage opportunities as they arise


Arrivals targets for Regional Africa – 5 years

2009 Actual

2010 Actual 2012 Target

% growth over 2011 Stretch

% growth over 2010 2013 P

% growth over 2012 2014P

% growth over 2013 2015P

% growth over 2014

Africa - Air 317,122 358,809 377,642 3.9% 5.2% 385,225 2.0% 392,713 1.9% 400,270 1.9%Angola 39,207 39,557 45,548 7.1% 15.1% 47,421 4.1% 49,300 4.0% 51,486 4.4%DRC 31,998 32,099 36,912 7.4% 15.0% 41,272 11.8% 45,686 10.7% 48,771 6.8%Kenya 28,196 32,129 34,119 4.3% 6.2% 34,799 2.0% 35,669 2.5% 36,451 2.2%Nigeria 45,527 49,520 55,559 3.4% 12.2% 56,228 1.2% 56,553 0.6% 58,057 2.7%Other Air 172,194 205,504 205,504 2.8% 0.0% 205,504 0.0% 205,504 0.0% 205,504 0.0%

Africa - Land 7,490,425 8,498,735 8,959,083 3.6% 5.4% 9,312,060 3.9% 9,580,773 2.9% 9,881,328 3.1%Botsw ana 836,072 829,928 858,315 3.4% 3.4% 866,688 1.0% 889,555 2.6% 900,940 1.3%Lesotho 2,098,278 2,679,106 2,875,433 5.7% 7.3% 3,082,726 7.2% 3,090,018 0.2% 3,097,311 0.2%Malaw i 152,358 137,062 148,949 8.7% 8.7% 149,642 0.5% 150,336 0.5% 151,029 0.5%Mozambique 1,361,133 1,329,590 1,537,567 11.2% 15.6% 1,660,922 8.0% 1,885,970 13.5% 2,154,340 14.2%Namibia 216,698 226,697 226,697 0.0% 0.0% 227,117 0.2% 227,327 0.1% 227,537 0.1%Sw aziland 1,087,739 1,038,047 1,041,161 -1.2% 0.3% 1,043,804 0.3% 1,046,682 0.3% 1,049,561 0.3%Zambia 164,276 172,315 176,628 2.5% 2.5% 177,533 0.5% 178,439 0.5% 179,345 0.5%Zimbabw e 1,573,871 2,085,990 2,094,334 -1.6% 0.4% 2,103,627 0.4% 2,112,446 0.4% 2,121,265 0.4%

Domestic Tourism


NTSS Objectives Related to Domestic Tourism

Note: 1The classification of the consumer-level job required is a subjective evaluationSource: Monitor/ Grail Analysis; National Tourism Sector Strategy, February 2011, Department of Tourism, Republic of South Africa

Objective Measures and Targets 2009 Baseline

2015 Target

2020 Target Consumer-level Job1

To grow the tourism sector’s absolute contribution to the economy

Increase number of domestic tourists-

No. of adult travellers -

Population penetration- Total Domestic Trips

14.6 Mn48%30.3 Mn

16 Mn

40 Mn

18 Mn

54 Mn

GrowthGrowthGrowth

Increase domestic tourism’s contribution to the tourism economy

Domestic tourism as a contribution to tourism’s overall contribution to GDP 52% 55% 60% Growth

Upper LSM consumers: change perceptions of taking a South African holiday versus outbound holidays

No baseline - - Culture Transformation

Middle LSM consumers: increase level of knowledge, understanding

and propensity to take holidays

No baseline - - Culture Transformation

Increase in domestic holiday travel across all markets-

No. of first-time holiday travellers-

Levels of, and penetration into, black market for domestic leisure tourism-

Holiday travel penetration by LSM-

Increase affordable and accessible tourism experiences for the domestic market-

Total no. of holiday trips

No baselineNo baselineNo baselineNo baseline

4 Mn

----

6 Mn

----

9 Mn

Culture TransformationCulture TransformationCulture TransformationN/A

Culture Transformation

Entrench a tourism culture among South Africans

Build a culture of embracing tourism among South Africans-

Increase in levels of awareness of tourism and its value within

South Africa-

Increase in levels of community participation in the sector-

Enhance social tourism programmes

No baselineNo baselineNo baseline

---

---

Culture TransformationN/AN/A

Address the issue of geographic, seasonal and rural spread

Increase geographic spread-

Total domestic bed nights 128.4 Mn 20% 34% Growth

Increase the level of tourism to rural areas-

Domestic arrivals and bed nights in rural areas No baseline - - Culture Transformation

Decrease seasonality-

Increase in share of bed nights spent in the low-season months 5.3% 7.1% 10% Growth


Domestic Tourism Indicators

Key Metrics 2007 2008 2009 2010 2011

Domestic Travel

Incidenc e

Annual 43.5% 46.5% 47.6% 43.0% 44.0%

Monthly1 9.9% 9.0% 8.2% 7.9% 7.0%

Number of Trips

Annual 35.9 Million 32.9 Million 30.3 Million 29.7 Million 26.3 Million

By Purpose

VFR: 68%, Holiday: 16%, Business: 7%,

Religious: 7%, Medical: 1%









Spend

Total Annual Spend R20.0 Billion R25.8 Billion R22.4 Billion R21.1 Billion R20.2 Billion

By Purpose











Average Spend per Trip / per

Day

R550 / Trip; R120 / Day

R780 / Trip; R170 / Day

R730 / Trip; R170 / Day

R710 / Trip; R160 / Day

R760 / Trip; R170 / Day

Trip Length

Total Annual Bed Nights 157.8 Million 149.0 Million 128.4 Million 130.8 Million 114.8 Million

Average Nights per

Trip4.4 4.5 4.2 4.4 4.4


Strategic Outcome Oriented Goal 2:

Goal Statement 2

Through the execution of its Strategic Plan and Annual Performance Plan, the following spend per person should be achieved on average for every person arriving in South Africa:

•

2010/11 actual R8,900 per person (this excludes prepaid)•

2011/12 calendar year target: R11 960 per person (this includes prepaid)•

2012/13 calendar year target: R12 536 per person (now calculated

NITS i.e. includes prepaid)

•

2013/14 calendar year target: R13 360 per person

To market South Africa in such a way that the average spend per arrival in South Africa is at least R12 536 per person during the 2012 calendar year being in South Africa


Total Foreign Direct Spend (excluding capital expenditure), 2009 to 2011ETotal Foreign Direct Spend (excluding capital expenditure), 2009Total Foreign Direct Spend (excluding capital expenditure), 2009 to 2011Eto 2011E

Total foreign direct spend generated from tourist arrivals decreased by -2.2% between 2010 and 2011.

59.2

35.1

3.5 3.9 3.8

13.0

72.6

47.1

3.4 5.2 4.512.4

71.0

47.2

3.8 4.2 4.4 11.4

0

20

40

60

80

100

Total Africa - land Africa - air Americas Asia &Australasia

Europe

2009

2010

2011E

Reve

nue

(R

-Bi

llion

)

2009 R8,900 R7,300 R14,700 R13,200 R14,900 R12,100

2010 R9,300 R8,300 R12,600 R12,800 R13,400 R10,700

2011E R8,900 R8,100 R13,300 R11,000 R12,000 R10,300

Note:

In 2009, Statistics SA for the first time was able to make the distinction between tourists and day visitors and this started a new data series. As a result of this change, the results in this

report are now not comparable to previous reports. Source: SAT Departure Surveys

Average spend per tourist in SA

Africa - land and Africa - air were the only regions that posted an increase in revenue from 2010 to 2011


Spend per Country

Through the execution of its Strategic Plan and Annual Performance Plan, the following spend per beperson should achieved on average for every person arriving in South Africa:

CURRENCY 2011 2012Africa - AirAngola USD 4,421 4,639 DRC USD 3,460 3,634 Kenya USD 2,814 2,957 Nigeria USD 5,502 5,886 Africa - LandBotswana ZAR 2,845 3,004 Lesotho ZAR 5,583 5,898 Malawi ZAR 9,349 9,928 Mozambique ZAR 12,068 12,744 Namibia ZAR 6,061 6,401 Swaziland ZAR 13,127 13,823 Zambia ZAR 8,706 9,194 Zimbabwe ZAR 6,757 6,748 AmericasBrazil REAL 9,487 10,084 Canada CANADIAN DOLLAR 6,086 6,317 USA USD 5,674 5,874 Asia & AustralasiaAustralia AUZ DOLLAR 6,531 6,812 China RMB 44,136 45,814 India RUPEE 195,101 212,883 Japan YEN 634,229 652,622 EuropeFrance EURO 3,384 3,506 Germany EURO 2,912 3,013 Italy EURO 3,446 3,498 Netherlands EURO 3,149 3,257 Sweden EURO 3,341 3,468 UK POUND 2,424 2,513



To

become one of the most preferred Tourism Brand by 2014 as measured by the following criteria:

1. Brand Knowledge2. Brand Journey3. Conversion of positive brand awareness to sales

Increase Average Brand Awareness

Achieved 79% in Feb 2011Target 79% Feb 2012 to 2015

To market South Africa in such a way that South Africa becomes a most preferred Tourism Brand by 2014 obtaining at least a 79% brand awareness


SA Brand Journey – Global Target (2008-11)

Compared to 2010, South Africa’s global scores on Positivity and Short-term Consideration have improved slightly in 2011

Note: In 2011, Core Markets weighted according to relative investment spend –

Australia = 7.3%, France = 13%, Germany = 15.2%, India = 7.8%, Netherlands = 9.5%, UK = 20.2% , USA = 21.4%, Kenya = 2.7%, Nigeria = 2.7%; Investment Markets weighted according to –

China = 38.9%, Italy = 25.8%, Japan = 11.6% and Brazil = 23.7%; Global Average, weighted according to investment spend –

Core = 90%, Investment = 10%; All rating questions have been analyzed using top 2 box approachSource: SAT BrandTracker Feb-08 through Nov-11 (merged for each year)

Awareness Positivity Sought Info in the Past

Likely to Visit in Next 18 Months

2008 Actual 76% 37% 22% 11%

2009 Actual 79% 38% 21% 11%

2010 Actual 79% 36% 22% 10%

2011 Actual 79% 37% 22% 12%

Global Targets


2008 2009 2010 2011

Market Closure Ratio Rank Closure

Ratio Rank Closure Ratio Rank Closure

Ratio Rank

Netherlands 1 in 3.44 7 1 in 3.27 6 1 in 2.96 6 1 in 2.86 6

Germany 1 in 2.17 8 1 in 2.21 7 1 in 2.14 8 1 in 1.87 6

UK 1 in 2.16 7 1 in 2.40 7 1 in 2.24 8 1 in 1.94 3

France 1 in 3.44 8 1 in 3.90 8 1 in 3.57 8 1 in 3.18 8

USA 1 in 3.87 9 1 in 3.57 10 1 in 3.14 10 1 in 2.28 5

India 1 in 1.91 8 1 in 2.05 8 1 in 1.68 6 1 in 1.58 6

Australia 1 in 3.40 8 1 in 2.79 8 1 in 2.82 7 1 in 2.81 7Kenya 1 in 1.24 1 1 in 1.06 4 1 in 1.30 2 1 in 1.61 3Nigeria 1 in 2.09 5 1 in 1.39 8 1 in 1.77 6 1 in 1.74 2

Significantly below Average for 13 destinations (at 95% confidence level)

Conversion – Global Target (2008-11)

2008 2009 2010 2011

Market Closure Ratio Rank Closure

Ratio Rank Closure Ratio Rank Closure

Ratio Rank

Italy 1 in 3.44 7 1 in 4.09 8 1 in 3.98 6 1 in 3.87 8China 1 in 2.10 8 1 in 2.44 6 1 in 3.45 7 1 in 3.07 6Japan 1 in 6.36 9 1 in 4.77 9 1 in 4.44 8 1 in 4.43 9Brazil NA NA NA NA 1 in 3.21 7 1 in 2.94 8

Significantly below Average for 13 destinations (at 95% confidence level)

Core Markets1

1 in 2.75 (2008)1 in 2.85 (2009)1 in 2.56 (2010)1 in 2.10 (2011)

Core Markets1

1 in 2.75 (2008)1 in 2.85 (2009)1 in 2.56 (2010)1 in 2.10 (2011)

Investment Markets2

1 in 2.78 (2008)1 in 3.12 (2009)1 in 3.76 (2010)1 in 3.26 (2011)

Investment Markets2

1 in 2.78 (2008)1 in 3.12 (2009)1 in 3.76 (2010)1 in 3.26 (2011)

Note: Global closure ratios weighted according to marketing spend in market; Closure Ratio = Visited in Past 18 Months / Sought Info in the Past; 1Core Markets’ score does not include Kenya and Nigeria for 2008 to 2010; 2Investment Markets’ score does not include the Brazil market for 2010Source: SAT BrandTracker Feb-08 through Nov-11 (merged for each year)

Global Closure Ratio1 in 2.75 (2008)1 in 2.88 (2009)1 in 2.65 (2010)1 in 2.19 (2011)

Global Closure Ratio1 in 2.75 (2008)1 in 2.88 (2009)1 in 2.65 (2010)1 in 2.19 (2011)

The closure ratio improved for both core markets and investment markets in 2011, as compared to 2010


Key Brand Journey Metrics (2011)

Note: Core Markets weighted according to relative investment spend – Australia = 7.3%, France = 13%, Germany = 15.2%, India = 7.8%, Netherlands = 9.5%, UK = 20.2% , USA = 21.4%, Kenya = 2.7%, Nigeria = 2.7%; Investment Markets weighted according to – China = 38.9%, Italy = 25.8%, Japan = 11.6% and Brazil = 23.7%; All rating questions have been analyzed using top 2 box approach Source: SAT BrandTracker Feb-11 and Nov-11

Total Awareness Positivity Likely to Visit

in FutureLikely to Seek

Info Sought InfoPlan to Visit in Next 18

Months

Visited Recently

Australia 82% 27% 23% 10% 13% 6% 5%

France 77% 36% 25% 18% 17% 9% 5%

Germany 69% 35% 26% 14% 17% 8% 9%

India 64% 40% 34% 39% 34% 24% 21%

Netherlands 87% 42% 32% 18% 27% 10% 9%

UK 91% 35% 35% 15% 20% 12% 10%

USA 82% 40% 30% 21% 21% 12% 9%

Kenya 72% 44% 51% 38% 45% 31% 28%

Nigeria 77% 47% 60% 41% 34% 32% 19%

China 78% 29% 36% 29% 33% 18% 11%

Japan 26% 8% 13% 3% 5% 1% 1%

Italy 73% 44% 33% 26% 29% 13% 7%

Brazil 63% 31% 23% 21% 20% 8% 7%

Core Markets1 80% 37% 31% 20% 21% 12% 10%

Investment Markets 67% 31% 30% 23% 26% 12% 8%

Quality Assurance



Strategic Outcome Oriented Goal 4: Quality assurance

Implement a recognisable and credible, globally bench-

marked system of quality assurance for accommodation and MESE experiences

which can be relied upon by visitors when making their choice of establishment


Plaque has been re-designed with New Security Feature


• South Africa needs to know how friendly our tourism accommodation facilities are to people living with disabilities

• 800 Establishments have UA Grading!!!


NUMBER OF UA PROPERTIES IN EACH CATEGORYNUMBER OF UA PROPERTIES IN EACH CATEGORY

HOTEL 91

LODGE 93

GUEST HOUSE 318

BED AND BREAKFAST 169

COUNTRY HOUSE 20

SELF-CATERING 110

TOTAL 801

Executive Establishments Summary Executive Establishments Summary As at end March 2012As at end March 2012

Non-Hotel Accommodation EC FS GP KZN LP MP NW NC WC

Grand Total

Backpacker & Hostelling 11 1 6 7 1 1 5 1 28 61

Bed & Breakfast 218 21 172 272 24 46 45 28 325 1151

Caravan & Camping 10 4 1 11 12 6 12 6 19 81

Country House 30 2 17 19 5 12 3 2 75 165

Self Catering 121 25 95 179 74 72 37 32 678 1313

Guest House 232 56 407 156 58 103 111 82 586 1791

Lodge 51 8 40 65 77 51 22 47 27 388Non-Hotel Accommodation Total 673 117 738 709 251 291 235 198 1738 4950

Hotel Total 60 24 153 103 30 27 28 17 176 618Accommodation Total 733 141 891 812 281 318 263 215 1914 5568

MESE Total 5 7 76 7 11 17 6 18 13 160

Grand Total Graded Properties 738 148 967 819 292 335 269 233 1927 5728

These stats include ALL establishments with a LIVE status in QiT. Cancelled establishments are not included.

32

Annual Targets for TGCSA

Actual

2008‐

2009

Actual

2009‐

2010

Target

2010‐

2011

Actual

2010‐

2011

Actual

2011‐

2012

Target

2012‐

2013

Target

2013‐

2014

Target

2014‐

2015

Target

2015‐

2016

Target

2016‐

2017

Total New 1808 1635 1281 967 1165 987 1086 1195 1314 1446

Total

Renewal 5132 6007 7007 4965 3721 5185 5703 6273 6901 7591

Grand Total 6940 7642 8288 5932 4886 6172 6789 7468 8215 9036

Annual

Growth 1540 702 646 ‐1710 ‐1046 121 617 679 747 821

Annual

Growth% 29% 10% 8% ‐22% ‐18% 2% 10% 11% 11% 11%

Total Live Properties (31 March

2012) 5728

Based on the April 2011 – September 2011 ACTUAL performance, the target for Graded Properties has been revised to reflect a 2% increase on last year vs the original 10% increase due to:•Decrease in the number of Assessors down to 40 from 52. An additional 15 New Assessors have subsequently been appointed.•The difficult trading conditions facing all operators.•The introduction of the New Grading Criteria effective 1 October 2010 - which are more comprehensive and stricter.

Accredited Assessors

Province Male Total Male Female Total FemaleBlack White Black White

Eastern Cape 1 1 1 1 2Free State 0 1 1Gauteng 1 5 6 4 4 8KZN 4 4 1 2 3Limpopo 2 1 3 0Mpumalanga 0 1 1 2North West 2 2 1 1 2Northern Cape 1 1 0Western Cape 4 1 5 5 5

22 23 45

Internal AssessorsCity Lodge Group 4 4 0Southern Sun Group 7 7 0

11 0Grand Total 7 26 33 8 15 23 56



For South African Tourism to achieve, through amongst others, the continuous improvement of its internal policies and procedures and the vigorous compliance with its policies and procedures by employees:

•

11th

consecutive unqualified annual external report•

To spend at least 98 –

102% of our annual budget included in the Annual Resource Plan for 2012/13

To continuously improve internal policies, procedures and business processes

National Convention Bureau



Team South Africa will entrench South Africa’s position as a world leading business events destination and be globally recognised for business events innovation. Business events will become one of the key sustainable economic development sectors in South Africa

Team South Africa will entrench South Africa’s position as a world leading business events destination and be globally recognised for business events innovation. Business events will become one of the key sustainable economic development sectors in South Africa

Strategic Direction Business Events’ Team South Africa – Vision

VisionVision

Source: GainingEdge research analysis

June 04, 2012 38| Copyright © 2012 GainingEdge and Grail Research, LLC — Confidential

Strategic Direction Business Events’ Team South Africa – Goals

Goals for Business Events’ Team South Africa (by 2020)

Source: GainingEdge research analysis

Goal 3Goal 3Broad recognition in South Africa of the business events industry as a major driver of job creation, skills development and transformation of the nation’s knowledge and creative economy

Broad recognition in South Africa of the business events industry as a major driver of job creation, skills development and transformation of the nation’s knowledge and creative economy

Goal 1Goal 1 Increase the size of South Africa’s business events industry by 57%Increase the size of South Africa’s business events industry by 57%

Goal 2Goal 2 Increase the measured impact of business events on tourism yield and geographic distribution by 112.5%Increase the measured impact of business events on tourism yield and geographic distribution by 112.5%


Goal 1 – Key Performance Indicators

Strategic Direction Goal 1: 57% Growth of Industry

Goal 1Goal 1

Goal 2

Goal 3

Pace Goals for Delegates at International Conventions1

Pace Goals for Delegates at International Conventions1

81.577.072.868.865.061.558.556.054.0

CAGR: +5.3%

201720162015201420132012 2018 2019 2020Target for ICCA Reported Attendees at International

Conventions (‘000)

Current Scenario and Growth PotentialCurrent Scenario and Growth Potential

Opportunity to host conventions:Opportunity to host conventions:

Note: 1Baseline for international delegates hosted by South Africa is 50,285 delegates in 2010 (based on ICCA statistics) and an estimated 52,000 in 2011; Estimated Baseline for total attendees in 2011 is 140,000 delegates. This is based on the global trend of ~35-40% of the business travellers being pure MICE delegates and departure survey indicating South Africa had a total of ~357,000 business travellers in 2010. We expect the total number of MICE delegates to grow at the same rate as the convention delegates. Actual baseline to be established for total attendees at international meetings, conventions and incentives plus total international attendees at exhibitions. Source: ICCA; SAT Departure Survey 2010; GainingEdge research analysis

Conventions Hosted in Africa

304

86

218

International Conventions

3,500

304

3,196

Conventions with Rotation

10,000

3,500

6,500

Conventions held in South Africa

ICCA estimated average attendees at conventions: 571

Global Growth in Business Travellers for 2009-10: ~6.8%



Strategic Direction Goal 2: Grow Measured Yield & Geographic Spread (1/2)

Goal 1

Goal 2Goal 2

Goal 3

Note: 1The baseline for total business events activity needs to be determined. Current estimates are based on a total of 140,000 delegates in 2011, who create a total average economic impact of ~ZAR 5,450-5,475 per day, with an average length of stay as 3.9 days (based on ICCA data); The impact on Tourism-GDP is projected to grow at the same rate as total economic activity driven by business events, with a multiplier of 2.45 from SAT Sector Study, 2011Source: ICCA Statistics; GainingEdge research analysis; SAT Departure Survey 2010; SAT Sector Study 2011

Pace Goals for Total Business Events Activity1Pace Goals for Total Business Events Activity1

6.45.8

5.34.8

4.44.13.73.5

CAGR: +8.7%

20172012 2016

3.21

20152011 2014

3.01

2013 2018 2019 2020Target for Total Direct Spend by Business

Events (ZAR Bn)

Current Scenario and Growth PotentialCurrent Scenario and Growth Potential

Current estimates are based on a total of ~140,000 delegates in 2011, who create an average economic impact of ~ZAR 5,450-5,475 per day, with an average length of stay as 3.9 day

Projected growth in total delegate arrivals between 2011-2020 is ~57%

Additional growth in yield of ~3.5% (CAGR) will lead to growth of business events’ total economic impact by 112.5%, and will be driven by:

• Increase in average economic impact per delegate day

• Increased average duration of stay

Current estimates are based on a total of ~140,000 delegates in 2011, who create an average economic impact of ~ZAR 5,450-5,475 per day, with an average length of stay as 3.9 day

Projected growth in total delegate arrivals between 2011-2020 is ~57%

Additional growth in yield of ~3.5% (CAGR) will lead to growth of business events’ total economic impact by 112.5%, and will be driven by:

• Increase in average economic impact per delegate day

• Increased average duration of stay



Strategic Direction Goal 2: Grow Measured Yield & Geographic Spread (2/2)

Goal 1

Goal 2Goal 2

Goal 3

Note: 1The baseline for total business events activity needs to be determined. Current estimates are based on a total of 140,000 delegates in 2011, who create a total average economic impact of ~ZAR 5,450-5,475 per day, with an average length of stay as 3.9 days (based on ICCA data)Source: ICCA Statistics; GainingEdge research analysis; SAT Departure Survey 2010; SAT Sector Study 2011

Pace Goals for Reported Business Events Activity on National DatabasePace Goals for Reported Business Events Activity on National Database



Strategic Direction Goal 3: Driving Jobs, Skills and Transformation (1/2)

Pace Goals for Job Creation1Pace Goals for Job Creation1

72.365.8

60.054.8

50.346.042.339.336.3

CAGR: +9.0%

201720162015201420132012 2018 2019 2020Target for Full Time Jobs Created (‘000)

Pace Goals for Skills Development through International Conventions in SA2

Pace Goals for Skills Development through International Conventions in SA2

32.829.8

27.124.8

22.720.819.117.6

20132012

16.32

CAGR: 9.2%

2017201620152014 2018 2019 2020Target for South Africans Attending International

Conventions (‘000)

Notes: 1Baseline is calculated on R7.35 B in GDP contribution for 2011, which would generate an estimated 34,000 full time jobs (based on R216,000 in GDP through direct spend leading to creation of 1 job, as per SAT Sector Study 2011); 2Baseline estimated at 15,000 South African professionals attending international conventions in South Africa in 2011, which needs to be tested through further researchSource: GainingEdge research analysis; SAT Sector Study 2011

Goal 1

Goal 2

Goal 3Goal 3



Strategic Direction Goal 3: Driving Jobs, Skills and Transformation (2/2)

Pace Goals for Transformation1Pace Goals for Transformation1

100.088.0

77.568.5

61.054.3

48.844.040.0

2018 2019 2020

CAGR: +12.1%

201720162015201420132012Target for Professionals Enrolled in South African

National and International Associations (‘000)

Pace Goals for Recognition in South Africa, of the Business Events Industry2

Pace Goals for Recognition in South Africa, of the Business Events Industry2

4.03.7

3.33.0

2.72.3

2.0

2018 2019 2020201720162015201420132012Target for Perceived Level of Importance in SA, of

Business Events as a Major Economic Driver

Notes: 1Baseline goal of identifying 40,000 South African national and international association members in 2012, including 25% professionals associated with BEE companies/institutions. The baseline and pace goals are based on assessment of GainingEdge and SANCB, and need to be tested through further research; 2Baseline and pace goals are detailed on the assumption that tracking of the perceived level of importance in South Africa (of the business events industry as a major economic driver) will begin in 2014. The study will track average response by policy makers to a survey of perceptions on the South African business events industry’s importance as an economic driver on the following scale: 1 = “very low”, 2 = “low”, 3 = “medium”, 4 = “high” and 5 = “very high”. The baseline and pace goals are based on assessment of GainingEdge and SANCB, and need to be tested through further researchSource: GainingEdge research analysis; SANCB assessment

NA NA

Goal 1

Goal 2

Goal 3Goal 3


SA Tourism Utilization of Government Grant: 2012/13 – 2014/15 (R’000)

Utilization of Government Grant Medium-term estimate

2012/13 2013/14 2014/15

International Marketing 407 144 421 964 449 292

Domestic Marketing 40 000 42 400 43 672

Financial Assistance 201 246 217 613 230 685

Grading Council 26 706 27 935 29 220

Convention Bureau 28 207 32 065 33 607Project Growing Tourism from Africa

50 000 84 000 84 000

Total Government Grant 753 303 825 977 870 476


SA Tourism Revenue budget breakdown 2012/13 (R’mil)


SA Tourism high-level revenue: 2012/13 – 2014/15 (R’000)

Funding of SA Tourism Medium-term estimate

2012/13 2013/14 2014/15

From Government MTEF

allocation 753 303 825 977 870 476

From TOMSA levies 78 000 80 000 82 000

From Grading fees 14 050 14 331 14 618

Indaba & Meetings Africa revenue 40 059 40 860 41 677

Sundry revenue 26 668 27 148 27 635

Total Revenue that agrees to final ENE submission 912 080 988 316 1 036 406


SA Tourism 2012/13 Expense budget breakdown per programme (R’mil)


Changes to SAT’s non-financial resources

Business Units

No changes are necessary in SAT’s current 16 business units:

1.

Office of the CEO/COO (including Internal Audit & Admin)2.

Human Resources3.

Africa Portfolio 4.

Domestic Marketing (including Events)5.

Asia, Australasia and Americas Portfolio6.

Europe & UK Portfolio7.

Central Marketing (including Global Brand, Channel & Agency Management)8.

E-Business9.

Research10.

PR & Comms11.

Product & Itinerary 12.

Finance (including Supply Chain and Legal)13.

TGCSA14.

Business Systems (previously known as IT)15.

Watch-list markets16.

Conventions Bureau (including Business Tourism)


Areas of co-operation with stakeholders

Stakeholder Details of co-operation

1. TBCSA & TOMSA 1.1 SAT is co-funded from voluntary tourism levies collected and SAT therefore

offers some specific benefits for establishments that collects TOMSA levies1.2 SAT and TBCSA, which represents all tourism business associations, jointly addresses the industry once a year in all provinces and have bilateral meeting quarterly

2. Provincial Tourism Authorities CEO’s Forum (now called the Marketing Working Group) meeting quarterly where SAT CEO meets Provincial CEO’s to share Business Plans & Budgets and discuss specific marketing issues including joint marketing projects. SANParks, SANBI and TEP also attend. The CMO convenes the quarterly marketing forum with provincial marketing

managers.

3. Fedhasa, ASATA and SATSA Sharing of information

4. NDT, other public entities & programmes:4.1 SANPARKS4.2 SA Weather service4.3 SANBI4.4 TEP

Lobby SANPARKS to also start collecting TOMSA levies. Provide exhibition space at exhibitions at beneficial rates Share informationShare informationJoint funding of ETEYA project

5. IMC, GCIS and the Department of Trade & Investment

Sharing of information and joint marketing activities

6. Miptech and Minmec Sharing of information on obtaining inputs on high-level marketing issues. SAT’s CEO attends both meetings.

7. Departments of International Relations & Cooperation and South African embassies overseas

Provide marketing collateral

Creative work – Regional Africa and Domestic


Angola -

Bring your …

to life


DRC – Let’s get together …


Kenya – Find yourself local …


Nigeria – Make it a day to remember…

Slide no. 69 © South African Tourism 2012Slide no.

Integrated Marketing Activation – BUILD CULTURE OF TRAVEL AND ACTIVATE HOLIDAY TRAVEL NOW

Source: Monitor/ Grail Analysis

Value Proposition

Travelling in South Africa is not only a great way to explore the country and discover the many reasons why the rest of the world wants to visit, but also an accessible way to escape and have fun with family and friends

Have fun in new/ different surroundings, whether with existing friends or meeting new friends along the way

Spend quality family time and broaden the family’s horizons, while being rewarded for hard work

Domestic travel is the quickest and easiest way to enjoy invaluable and enviable world-class experiences

South Africa has so many different places and ways to escape, relax and spend quality time with loved ones

Break away from daily pressures, whether relaxing with family or having good times with friends

Umbrella Strategy

Spontaneous Budget Explorers

New Horizon New Horizon FamiliesFamilies

High-Life Enthusiasts

Seasoned Leisure Seekers

Well-to-Do Mzansi Families

Products

Lots of activities with friends without being prescriptive

Accessible and informative family holidays

Glamorous and comfortable holidays

Explore hidden cultural, culinary and landscape gems

Hassle free and comfortable getaways


Domestic Drivers

PROVINCIAL AND INDUSRTYPROVINCIAL AND INDUSRTYPROVINCIAL AND INDUSRTY

PACKAGES• Develop provincial packages encouraging SA’s to travel like a local in their own province regularly

TOOL KITS• Develop provincial tool kit to help guide priorities per province to link to well-suited activations

PACKAGESPACKAGES•• Develop provincial packages Develop provincial packages encouraging SAencouraging SA’’s to travel like a s to travel like a local in their own province regularlylocal in their own province regularly

TOOL KITSTOOL KITS•• Develop provincial tool kit to help Develop provincial tool kit to help guide priorities per province to link guide priorities per province to link to wellto well--suited activationssuited activations

DOMESTICDOMESTICInspire Inspire

& & ShareShare

CONSUMERCONSUMERCONSUMER

NATIONAL• Develop and execute a National Consumer campaign that captures the hearts and minds of South Africans and inspires the to travel and share their experiences • Design a National competition to encourage SA’s to share their National and Provincial places they have seen • Build awareness via television, radio, print, outdoor, mobi, digital and activations of all the places to be seen in SA – create an element of excitement to travel, explore, share and stand a chance to win a road-trip of a lifetime

NATIONALNATIONAL•• Develop and execute a National Develop and execute a National Consumer campaign that captures Consumer campaign that captures the hearts and minds of South the hearts and minds of South Africans and inspires the to travel Africans and inspires the to travel and share their experiencesand share their experiences•• Design a National competition to Design a National competition to encourage SAencourage SA’’s to share their s to share their National and Provincial places they National and Provincial places they have seenhave seen•• Build awareness via television, Build awareness via television, radio, print, outdoor, mobi, digital radio, print, outdoor, mobi, digital and activations of all the places to and activations of all the places to be seen in SA be seen in SA –– create an element create an element of excitement to travel, explore, of excitement to travel, explore, share and stand a chance to win a share and stand a chance to win a roadroad--trip of a lifetimetrip of a lifetime


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