Brand of my fathers

There's no doubt that Wales has suffered from a perception problem in past years. For some a holiday in the UK's smallest country simply conjures up buckets and spades on a beach, for others it's a two-week endurance test of regimental guesthouses, unpalatable food and endless drizzle. Anne Robinson didn't help matters last year when she put "Wales" into her Room 101.

The truth is that Wales is a lot more than a two-week seaside destination, as the Wales Tourist Board (WTB), backed by the Welsh Assembly, is keen to promote. It has unrivalled scenery, a variety of sports and activities to pursue, plus some award-winning restaurants and hotels, but Wales needs a new image. And with a £37m budget and £10m campaign for 2002 called The Big Country, it's getting just that.

"Wales's image overseas isn't bad," insists Jonathan Jones, chief executive of the WTB, "but it is weak. We are now branding Wales quite clearly as a land of nature and legend. Another major problem is the perception that Wales is far away, where the reality is that it's very close. It's ignorance."

The markets are also changing. Recent figures show the short-holiday market growing at a significantly faster rate than the traditional long holiday. In 1998 short breaks accounted for 28% of all domestic holiday spend in Wales compared with 18% at the start of the decade, and for 51% of all holiday trips compared with 38% in 1991. According to 2001 figures, average length of holiday stay was four nights, down from 5.3 nights in 1991.

To maximise the potential of the short-break market, revenue from tourism in Wales must be spread year-round, says Jones. June, July and August has traditionally been the main holiday season, with many hotels closing for winter. With the two-week holiday on the wane, new tourism products are essential to develop a higher-yielding tourism business. "We're putting together products for touring, heritage and culture, plus sports and activities, and branding Wales clearly," he says. "Our job is to package a Wales that is accessible."

Increased budget
Promoting Wales is an expensive task, involving TV, radio and press advertisements and direct marketing. The Welsh Assembly is in full support, having increased the WTB's budget from £15m to £37m in the past two years, which has resulted in several large-scale campaigns, including "Two Hours and a Million Miles Away" last year and this year's "The Big Country". In addition, to encourage new business, a capital grants regime is in place to award grants to new tourism projects. Up to 50% of eligible capital costs will be covered for those who meet the criteria.

Business travel is also a growing market, with resort hotels such as the five-star 400-room Celtic Manor in Newport, Gwent, offering a 1,500-delegate convention centre and 40 function rooms, and conference centres in Swansea and Cardiff competing for business.

With three championship golf courses of its own, Celtic Manor is hosting the Ryder Cup in 2010, which will ride on the back of the launch of a £3m WTB golf campaign. Other sporting events held at Cardiff's Millennium Stadium are also expected to bring significant trade to the region.

But there are challenges, says Jones. Apart from creating a stronger identity, Wales has a serious staffing problem. Tourism supports up to 100,000 jobs directly and indirectly in the Welsh economy, more than 10% of the workforce, but that figure is expected to rise by an additional 22,000 within five years. The traditional seasonality of tourist work has created a seasonal workforce, often young, part-time, untrained and unskilled. With unemployment at 4%, competition to fill jobs in the industry is high.

"At the moment, 60% of tourism revenue is earned in June, July and August," explains Jones, "so we must market our products to spread through the rest of the year. Only then can we create jobs all year round - and one of the biggest tasks is to get youngsters to think about tourism as more than a holiday job. The tourism of the present and future is going to be far more critical of service levels and quality than it has been before, so we need to find the right skills."

The WTB has established a training forum, bringing together private-sector tourism bodies to help inform and assist training providers. It is also hoped that increased involvement with Springboard Wales will get the message across to youngsters.

Yet Jones is positive about the future. After last year's fall in visitor numbers by almost two million due to the foot-and-mouth epidemic and 11 September, this year has seen numbers increase by 2% with expenditure up by 11%. Backed by the "Big Country" campaign, those figures should keep rising.

"Tourism in Wales will increase over the next five years," says Jones. "We are charged by the Welsh Assembly Government to increase earnings by 6% year-on-year and we are confident that we will do it because of our marketing strategies. We are cautiously optimistic."

Cardiff

Cardiff in 2002 is a city in transformation. Since hosting the Rugby World Cup in 1999, the Welsh capital has undergone a rapid process of regeneration and redevelopment that has left it altered both physically and psychologically. Cardiff is now the fastest-growing city in Europe and, as a mark of its new-found confidence, is bidding against the likes of Newcastle and Gateshead, Bristol and Belfast to be European City of Culture 2008.

Underpinning Cardiff's rebirth has been a series of significant new developments, including the Millennium Stadium, the Millennium Centre and the Cardiff Bay development. Such venues and regeneration schemes have made the city a focus for both national and international events and provide a sturdy platform for tourism and hospitality operators to grow and flourish.

Since 1999 Wales has seen its first, and then second and third, five-star hotels open in Cardiff, as well as a host of mid-range and budget hotels. Rocco Forte Hotels' St David's Hotel and Spa, the first five-star property to open, has formed a central part of the city's regenerated docklands. Now a host of restaurants, bars and clubs also cluster along the edge of the waterfront, creating both a new area for the city to expand into and a focus for the growth of Welsh tourism and hospitality business.

The ability to host large-scale events, however, is perhaps the most compelling impetus behind Cardiff's growth to date, particularly as a leisure destination. The Millennium Stadium alone holds 73,500 people and plans to host about 40 major annual events - including the FA Cup Final - all of which bring a huge influx of visitors into the city. The Millennium Centre, to be completed in 2003, will provide a home for seven of the country's leading cultural organisations, including the Welsh National Opera. It, too, is expected to attract a steady stream of visitors and international coverage.

The swiftness of development in Cardiff to date has created its own problems, however. The sudden flood of new hotels into the city to cater for the 1999 Rugby World Cup - bedroom stock increased by 66% between 1998 and 2000 - meant that as soon as the event was over both occupancy and room rates plummeted. Average hotel occupancy across the city at the end of 1999 was 68%, but by the end of 2000 it had dropped to 63%, according to market research company You're Welcome! Hotel Data.

"Prior to 1999 the city had a strategy suggesting that a certain amount of new hotel rooms were needed over the next five years," says Peter Cole, strategy director for Capital Region Tourism. "In fact, we completed the plan in 18 months."

The increase in hotel rooms had an inevitable effect on hoteliers. "It's taken us three years to recover from the peak of 1999," says Paul Rogers, general manager of the 136-bedroom Thistle hotel in Cardiff. "Even now rates and occupancy can be very unstable. If there are no events or conferences going on, occupancy can be dire. Other weeks we are totally full. It makes it hard to manage a business."

Since this early set-back, however, the gradual flow of investment, and thus infrastructure, has supported a measured revival of business for hoteliers. Hotel occupancy has recovered, rising from 68.9% in 2001 to 73.2% in 2002 to date. Similarly, average achieved room rates have gone up from £60.52 in 2001 to £64.21 so far in 2002.

"Leisure development isn't slowing in Cardiff," says Mandy Davis, financial manager at the five-star 197-bedroom Hilton. "There's been a real buzz growing in the city over the past few years."

The city is not finished yet, however. Already partnerships offering combined discounts and incentives are developing between Cardiff's leisure and retail markets in an attempt to encourage even more visitors into the city. Further major developments include increased shopping facilities and a sports village.

Despite this growing sense of vigour, however, there are challenges ahead, particularly if the city is to tap into the lucrative conference and banqueting market. "At the moment our major shortcoming is that we lack a dedicated convention centre," says Phil Roberts, general secretary of the Cardiff Hotel Association. It is a sentiment echoed by hoteliers across the city. "It is our main missing link," says the Hilton's Davis.

There seems little doubt, however, that Cardiff is now maturing into the capital status it received comparatively recently, in 1955. "We see Cardiff as instrumental to the growth of tourism in the whole of Wales," says Cole. "Tourism in south-east Wales is a relatively new phenomenon, but as a region we've got the best hotels, biggest events and quality golf courses."

Cardiff now looks forward to hosting what may be its most significant event yet, the 2010 Ryder Cup, which is taking place at the Celtic Manor hotel golf courses. "This event will provide us with a shop window to the world," says Cole. "My vision is that Cardiff will be truly ready for it, not only in terms of hotel rooms and transport links, but as a region ready to offer and embrace world-class standards of service."

Llandudno

Dubbed the queen of Welsh resorts, Llandudno is the largest holiday resort in Wales, boasting two beaches, a sweeping promenade of elegant Victorian hotels and more bedspaces, at 20,000, than anywhere in the country. Once a popular holiday destination for UK families, long-stay visitors have declined steadily over the past 10 years, having been lured away by budget airlines and cheap package deals abroad. These days, the average length of stay is about three nights.

It's meant the town's hotel industry has been forced to look to other markets to fill the gap. David Williams, chairman of the Llandudno Hospitality Association, and owner of the 57-bedroom Ambassador hotel, says the fastest growing market in Llandudno is that for short breaks and conferences.

While the core of his business at the Ambassador remains the holiday trade - keeping occupancy levels during summer at 80% - the short-break market is predominant. "The margins are less, it's harder work, but we are still in business," he says. "The challenge is to bring in more business in winter when occupancy levels typically fall to around 25% with discounts and deals. This is no longer a bucket-and-spade resort."

Once upon a time the family-run 58-bedroom Empire hotel was fully booked throughout summer by families wanting full-board accommodation. These days the short-break market dominates trade throughout the year and, like many hotels in the area, bookings for more than two nights are unusual. Director Elyse Waddy says occupancy at the Empire is often at 100% during weekends, with good occupancies in midweek as a result of the conference market.

"We're getting a good winter short-break trade and high-end corporate business during the week," she says. "But good midweek business is often down to which conferences are on. They are really beneficial to this town."

In addition, Waddy's parents, Len and Elizabeth Maddocks, have spent about £1m on renovating the Empire's sister hotel, the six-suite Osbourne House, rated five-star by the WTB with rack rates at £130 per suite midweek and £200 on weekends. At present occupancy is at 50%, but it's hoped high-end domestic and corporate business will raise those figures in the future.

The 18-bedroom St Tudno hotel, run by Martin and Janette Bland, equally courts the short-break market and rarely budges from rack rates of £276 for two people for one night. Word-of-mouth recommendation plus three AA rosettes and two stars and an RAC Gold Ribbon award has ensured a good short-break trade, both domestic and international. According to Janette Bland, however, it's been hard work, requiring continuous reinvestment and attention to the market.

"We have moved with the times and invested a lot of money back into the business," she says, of the hotel she and her husband opened in 1972. "We've been rewarded with the balance sheet, but when we came into the business I could see that some of the other hotels didn't invest as much as us. I was shocked at the sense of apathy."

Dewi Davies, regional strategy director for North Wales, says that investment - from hotels as well as tourist agencies, the WTB and the Assembly - is key to developing new trade in an increasingly diverse market. Designated a strategic Tourism Growth Area in early 2002, Llandudno has so far received £2m to develop areas of tourist revenue.

Conference facilities are already in place on the promenade at the North Wales Conference Centre next to the North Wales Theatre, with a combined capacity of 2,500. Basic upgrading of hotels and restaurants will aid Llandudno's positioning as a touring base for North Wales, says Davies, but key projects for the town are securing a new four-star conference hotel and a health and spa facility.

"We're trying to get a major spa investor into the town and a four-star conference hotel is on our wish list at the moment," he says. "But we also need to improve our infrastructure, from improving road access into the national parks to improving our harbours and marinas. We've got a lot of attractions but could do with a few more lottery-type projects on the scale of the Eden Project. Llandudno is a brilliant tourist base and we've some excellent attractions, but the truth is you never can rest - reinvestment needs to be substantial."

Powys, Hay-on-Wye and the Brecon Beacons

Despite the international fame of Hay-on-Wye as both an idyllic country town and a mecca for literature lovers worldwide, the greater region of mid-Wales, or Powys, remains relatively undiscovered.

"Mid-Wales remains an unknown secret," says Tonia Parry, tourism officer for Powys County Council. "Even with Hay, it doesn't have the strength of branding of the traditional seaside resorts, Cardiff or the Snowdonia region."

All this is set to change, however. The Brecon Beacons National Park has just appointed its first tourism officer for sustainable development, Richard Tyler, in a drive to encourage more tourists into the rest of mid-Wales.

"We can't rely on books forever," says Tyler. "Tourism is the key to local, cultural and sustainable development in the region."

Following research carried out by the Wales Tourist Board (WTB), the Brecon Beacons will now be rebranded "the playground of Wales" and marketed specifically for the range of activities it offers.

Visitor spend on recreation in the Powys region in 2000 was £2.3m, but it dropped to £1.8m in 2001 when the region was severely affected by foot-and-mouth disease. To reverse this trend, the WTB is making an investment of £500,000 over the next five years to create a new centre for activity tourism in Wales and thereby attract a wider range of visitors. Money will go towards the creation of several activity centres offering biking, horse riding and walking trails.

Despite this new focus and increased investment from the WTB, tourism in mid-Wales has some way to go. The fragmented nature of accommodation in the area, dominated by B&Bs and small hotels, inevitably defines the capacity for tourism development.

Attracting lucrative tour groups is still almost impossible due to the lack of large hotels to accommodate them. Furthermore, the flood of self-catering barn and farmhouse conversions that followed the outbreaks of BSE and foot-and-mouth has diluted the accommodation market to, at times, uncomfortable levels. On top of this, the small villages and towns that make up the region still mean early closing times and a lack of tourist amenities.

The region's infrastructure, a barrier to development in some respects, is also its most compelling selling point, however. The Silurian Retreats is the name of a group of restaurants, hotels and B&Bs across the Brecon Beacons that have teamed up to market their wares in recognition of the area's attractions and quality accommodation.

So far, their strategy seems to be working. "There are definitely benefits of grouping together like this," says James Suter, a Silurian member and partner at the Gliffaes Country House Hotel in Crickhowell. "This summer we've had more people through the door and they've stayed for longer periods."

Another member of the group, Sean Gerrard, manager and chef at the Nantyffin Cider Mill, also in Crickhowell, notes that revenue is 12% higher this year than any since opening 12 years ago.

One of the group's primary objectives is to market the region as not only a destination for quality accommodation, but also a culinary attraction. "Use of fresh, local food is very common in Powys, but because it is so normal, people don't realise its marketing potential," says Parry.

Now, however, groups such as the Silurian Retreats and marketing specialists such as Suzanne Davies, co-ordinator at Powys Food Links, whose job is to encourage food operators to use and advertise their usage of local products, aim to make Powys a gourmet destination of the future.

Volume and value of tourism to Wales

Swansea

Along with Dylan Thomas, Anthony Hopkins and Richard Burton, Catherine Zeta-Jones is another famous Swansea Jack (as the locals are called) accredited with putting the coastal town on the map.

Andrew Heatherington is owner of the eight-bedroom Fairyhill hotel and restaurant on the Gower Peninsula, which boasts three rosettes and two AA stars. He says business has picked up in recent years, partly aided by the publicity surrounding Zeta-Jones's birthplace. It's now a popular destination for walking and sightseeing.

"Gower is an area of outstanding natural beauty," he says, "but was a well-kept secret before it gained publicity in recent years because Catherine Zeta-Jones lived near by. We're in a lucky position because we are the only hotel of this calibre in the area."

Occupancy at the Fairyhill has increased in recent years and is now at 65%, staying relatively stable throughout the year. Its market comprises mostly two- to three-night breaks, a far cry from the early years when low occupancies of 25% meant the hotel closed for the winter.

"Swansea was a bucket-and-spade seaside town, but now more people are spending short breaks here. It's a question of redefining the market. We close for the first two weeks of January, but other than that the winter months aren't so bad now," says Heatherington.

However, Swansea can't put it all down to its native Hollywood star. It was designated a strategic Tourism Growth Area two years ago and was awarded £2m as a result. New projects include the Morfa stadium, set to become home to Swansea City's football and rugby clubs, and the Wales National Pool, which will offer a venue for championship swimming. Other developments over the next five years will include the National Waterfront Museum and Castle Quays retail centre.

Jany Shaddick-Williams, sales and marketing manager for the four-star 117-bedroom Swansea Marriott hotel in the town's Maritime Quarter, has seen an increase of 30% in bedspace demand at the hotel in the past 12 months. She accredits the growth to Swansea's new projects plus overspill from Cardiff during events at the Millennium Stadium.

"Swansea has definitely been impacted by the stadium," she says. "It was surprising that after foot-and-mouth and 11 September we saw such a big change in demand over the last 12 months, but it's because when Cardiff gets booked up people come to Swansea."

The Marriott has seen a growing conference market, with overall occupancy increased by 3% year-on-year as of the end of July - midweek is up 1% and weekends are up 4%. The hotel now boasts the highest occupancy in the group in the UK.

"We've got a lot to look forward to," Shaddick-Williams says. "We have always enjoyed good occupancy, but in the last 12 months we've seen business growing."

Did you know?

• Tourism is worth an estimated £5m a day, or £2b a year, to the Welsh economy.
• Tourism represents 7% of the Welsh gross domestic product and is, therefore, one of the most important industries to the country - more than construction and farming combined.
• 100,000 people in Wales are employed in tourism. This represents 10% of the workforce.
• 50% of tourism revenue is in rural Wales.
• The average size of a hotel in Wales is six bedrooms, and the average number of employees is 10 per business.