Challenge

The challenge is to update Palm Cove marketing strategies to match the changes in asset ownership and marketing and distribution channels since the 1980’s.  This hasn’t happened.  It is an Australia-wide challenge that hasn’t generally been met.

Backstory

By the mid 1980’s there were 4 or 5 motel/lodge/guest house type properties providing holiday accommodation in Palm Cove in addition to Esplanade family cottages.  They included the Calypso (now Sarayi) and Coconut Lodge Motels, Palm Cove Lodge (where Peppers is now), The Reef House and possibly one other plus the Caravan Park.

After the opening of the international airport in 1984 there was a burst of construction activity.  By 1989 the following single owner tourism accommodation properties were built :

• Ramada Reef Resort (now Drift Apartments)
• Eden Coral Coast (currently a rebuild by Hilton)
• The Reef House (expansion)
• Paradise Village Resort (now Paradise on the Beach)
• Reef Retreat

By 1989 the first strata titled properties came online.  They were:

• Villa Paradiso
• Paringa Apartments
• Jewel of the Reef (now Alamanda by Lancemore)

Over the next 20 years the following strata titled apartments were built:

• Mango Lagoon
• Marlin Waters
• Melaleuca Resort
• Azure Waters (now Alassio)
• Mantra Amphora
• Coral Horizons
• Elysium Apartments
• Peppers

Initially, in most of the strata titled properties the on-site owners of the management rights held all of the Short Term Rental (STR) inventory in their letting pools.  So, in many ways the situation was similar to the single owner properties with the owner of the management rights representing all of the rooms in the property.

Promotion, sales and merchandising involved the unit owners jointly funding a brochure and, more often than not, appointing a specialist representative such as Ron Livingston’s Pinnacle Marketing or Todd Parker’s Parker Travel Collection.  They would then negotiate arrangements with travel wholesalers and inbound operators for the properties to get the brochures into retail travel agents and consolidate all inclusive tour products.

Then, along came the internet

“Daddy and Mummy, I can build a website for our room in Tropical Hibiscus Resort.  And I don’t like that name.  Let’s call our room Frangipani Heaven.  Also, we don’t need that man anymore who I hear you say takes all our money and puts guests in other rooms first.  We can do everything from here in Kalgoorlie.  And Sally can do a brochure.  She almost topped the class in art.”

“That’s a really good idea Kaylee.”

Then the Online Travel Agents (OTAs) and Peer-to-Peer (PtP) accommodation platforms arrived on the scene; booking.com, tripadvisor, airbnb etc,  and consolidators of consolidators such as trivago.

So how did that change marketing of niche destinations like Palm Cove?

One of the outcomes of these changes was and is that Local Travel Associations (LTAs) like Tourism Palm Cove no longer have direct access to the actual owners of the destination STR inventory.  In most cases, in order to access all of these owners, they need to get past the Body Corporate (BC) gatekeeper and/or the owner of the management rights.

Reaching titleholders, only through these filters, may limit owners to only receiving information approved by those entities.  They may even discourage owners from dealing directly with their LTA.

Rightly or wrongly the BC model comes in for a lot of criticism, but it is here to stay and growing.

What is the BC model?

Yes, the Body Corp or Owners Corporation (OC), as it’s now known in NSW, has access to all of the strata titleholders within a property.

The Queensland Office of the Commissioner for Body Corporate and Community Management (BCCM) tells us that the BC:

• maintains, manages and controls the common property on behalf of owners
• decides the amounts to be paid by the owners to make sure the body corporate can operate, makes and enforces its own rules, called by-laws, which tell owners and other people who live in the scheme what they can and cannot do
• takes out insurance on behalf of owners, such as public risk insurance over the common property and building insurance
• manages and controls body corporate assets, keeps records for the body corporate, including minutes of meetings, roll of owners details, financial accounts, registers of assets, improvements to common property by owners, engagements and authorisations.

Although anything to do with marketing of STRs within the property isn’t included in the BC charter, the BC committee, with varying experience and skill levels, usually has significant influence over marketing strategies.

In some properties there is also the contracted BC management company which is responsible for financial management, property maintenance, administrative tasks and compliance.

Businesses – Landlords and Tenants

Most often, business owners in retail, personal services, bars and restaurants for example, rent their premises from owners of units within strata titled properties.

When it comes to destination development and marketing, do strata titled unit owners and their business tenants share the same aspirations?

• They both want more people staying in, visiting and spending in Palm Cove
• Landlords want their properties to increase in capital value whereas tenants may see that as leading to an increase in rent
• Tenants usually need a quicker return on their investment than landlords
• Landlords may favour strategies that build on the longer term benefits to the destination
• Tenants may favour shorter term strategies

Is there a way to develop a closer understanding between these different aspirations?

The Solution – A Pilot Study

The suggestion is that Tourism Tropical North Queensland (TTNQ) submit a proposal through Tourism and Events Queensland to Tourism Australia to fund a pilot study with Palm Cove as the subject destination.

Palm Cove is an ideal destination for a study of this type for the following reasons:

• There is a mix of ownership models across the full spectrum
• There are all Short Term Rental (STR) product genres including private homes, strata titled units, single owner resorts and a caravan park
• There is a wide variety of letting pool models
• Target markets include international as well as domestic
• It is has discrete geographic boundaries
• There is a 40+ year history of marketing internationally and domestically
• The destination serves all demographics
• There is no clear marketing roadmap which addresses the needs of all stakeholders
• There may be a benefit in evaluating communication options between full time residents and tourism interests