MONACO:PLACE EXCELLENCE AND CLIENT

ATTRACTION

Analyzing the current

capabilities of Monaco in

order to attract key clients

IUM MBA 2014

OUTLINE

•Team Profiles

•Project Task

•National Performance of Monaco Country profile

2013 National Performance & financial crisis impact

Monaco vision, values, & strategy

•Tools & Methodology Blue Ocean Strategy

Determinants of National Diamond

Strategic Sweet spot & Country Radar

Place Excellence

•Research and Analysis Customer Profiles

Benchmark: Dubai

•Monaco Brand Analysis

•Proposed Strategies and Solutions

•Conclusion & Key Takeaways

2

TEAM PROFILES

3

Svetlana Masjutina

Strategy & Research

Brett Lowers

Benchmark Specialist

Olga

Zubrilova

Strategy & Research

TEAM PROFILES

4

Arbia Ziadi

Customer Profile

Specialist- Middle East

& Medical Tourism

Specialist

Nuriya Khusainova

Customer Profile

Specialist- Middle East

MONACO NATIONAL PERFORMANCE AND VISION

2013 National Statistics

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COUNTRY PROFILE: KEY CHARACTERISTICS

MONACO is the 2nd smallest country in

the world with , with only 0.75 square miles in

area with 7 centuries of history.

The Principality is a hereditary and

constitutional monarchy

Location

Southern Europe, on

the shores of the

Mediterranean,

between the French

and Italian Riviera

The Climate The PopulationLanguage

Religion Currency Access

Mediterranean,

about 360 sunny

days per year

Cosmopolitan country with

more than 120 nationalities

represented:

about 8000 Monegasques,

almost 10,000 French

nationalities, over 6,500

Italians and

2,600 British people and

several hundred nationals

such as those of Belgium,

Switzerland, Germany

and the USA

French is the official

language but English and

Italian are widely spoken

and understood

Roman

Catholicism

(State religion)

Other religious

freedom is

guaranteed

Euro (1st January

1999) and used on

Monegasque

territory since 1st

January 2002

Easy access to European

motorway

Nice airport

Helicopter links

Underground station

2 ports for pleasure craft

and semi floating see

wall to receive ships

6

2013 NATIONAL ECONOMIC PERFORMANCE

10.1%0.5%3.5%

3.2%

7.3%

2.8%0.0%

8.1%

2.4%

7.1%

3.9%8.1%

42.9%

Distribution of the 2013 Principality’s revenue

2013 Revenue in Monaco – euro15.86 billion

Source: IMSEE Monaco Statistics

GDP in Monaco rose to 4.48 billion euro in 2012, compared to 4.37 billion in 2011. This

represents a 0.9% growth in volume (adjusted for inflation). There is no official data yet for 2013.

GDP per person employed is growing less quickly than global GDP due to an increase in

employment (+2.6% in the number of employees on 31/12/2011). As the increase in the

working population (+1.9%) is higher than that of GDP, the level of GDP per employed person

has fallen (-0.9%).7

MONACO VISION, VALUES, & STRATEGY

Vision

Monaco strategy

Values hospitality, underpinned by friendliness and

generosity**

Strategy enhancing the attractiveness

Lab country (innovation hub) **

To be “a country generating models:

a model of life;

a model of development,

a model of well being,

a model of peace*

To build up strong long-term competitive advantage Prince Albert determined his

national vision and strategy based on Monaco values:

* Investiture speech H.S.H. Prince Albert IInd of Monaco, July 12th, 2005.

** Monaco Welcome Business Office, www.monaco-welcome.mc

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TOOLS AND METHODOLOGY Tools for Achieving

Excellence

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TOOLS & METHODOLOGY

To provide the holistic analyses and comprehensive solution for our

project we used an innovative management methodology and tools

Blue Ocean Strategy:

Innovative strategy to make the competition irrelevant by changing

the playing field of strategy and achieve long-term advantage

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TOOLS & METHODOLOGY (CONT.)

Firm strategy,

structure and

rivalry

Demand

conditions

Related and

supporting industry

Factor

conditions– Resources;

– infrastructure

Home market buyers

press to innovate faster

than competitors

– provide cost-effective inputs,

– participation in the upgrading process,

– drivers for companies in the chain to innovate

GOVERNMENT

CHANCE

KEY MANAGER OF THE

NATIONAL ADVANTAGE

CREATION

OCCURRENCES

THAT ARE OUTSIDE

OF FIRM CONTROL

Porter’s diamond: the determinants of national competitive advantage

The way in which companies are created,

set goals and are managed is important for success.

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TOOLS & METHODOLOGY (CONT.)

Strategic sweet spot:

to define unique Monaco capabilities

Country Radar :

to identify new national dimensions

12

TOOLS & METHODOLOGY (CONT.)

Place excellence:

To provide recommendations for Monaco National Brand Strengthen

13

RESEARCH & ANALYSISTourism Trends

Client Profiles

Benchmark: Dubai

14

WORLD TOURISM TRENDS

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TOURISM TRENDS 2009-2013

•Asia, Middle East and Latin America are top growth markets

•Tours and city holidays by consumers in emerging markets have driven tourism growth

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TOURISM TRENDS 2009-2013 (CONT.)

•Meetings, Incentives, Conferencing, Exhibitions (MICE) travel has seen much faster growth than traditional business travel since 2009

•The MICE segment now accounts for 54% of the total business travel market due to Substantial cuts in corporate travel spending

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Type of Travel Percentage Increase/Decrease

Incentives +61%

Conventions +44%

Conferences +27%

Traditional Business Travel -10%

INTERNATIONAL CUSTOMER PROFILES

“To expand your vision, you

must first understand your

customers…”

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Top Tourism Destinations

1. St-Barth's

2. Malaysia

3. Lebanon & Turkey

Regional Economic Indicators

• Saudi Arabia 576.8 billion USD

• United Arab Emirates 360.2 billion USD

• Qatar 173 billion USD Motivators for Selecting a Destination

1. Extravagance & Recognition

2. Infrastructure & Personal service

3. Visa & Language

Types of Tourism

1. Luxury retreat

2. Business

3. Events & Shopping

Top business destinations

1. London

2. Geneva & Luxembourg

3. Dubai

MIDDLE EAST

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Culture

• Hospitality

• Collectivism

• Islamic life

Top Destinations

1. Hong Kong/Macao

2.Australia

3.Dubai/Singapore

Regional Economic Indicators

-100 mln. outbound tourists are expected in 2014

-The fastest growing outbound tourism market in the world

Motivators for Selecting a Destination

1.Sightseeing 75%

2.Dining 65%

3.Shopping 51%

Types of Tourism

1. Leisure

2.Business

3.Educational tours

Important Statistics

1. 62% prefer to travel independently

2. 4,3 trips per year

3. 1,7 week per stay

4. Travel to Europe between May and September

CHINA

20

Top Destinations1. South East Asia/ Asia Pacific (Singapore,

Malaysia, Thailand)

2. Dubai

3. Nepal

4. USA, Australia, Europe

Regional Economic Indicators

- One of the fastest growing markets in the world (4,7% in 2012)

- Rising disposable income

- Outbound tourist departures: 20.5 Mil (2015), 50 Mil (2020)

Motivators for Selecting a Destination1. Sightseeing- 64%

2. Explore new countries- 47%

3. Leisure- 25%

Types of Tourism

1. 40-65% business

2. 35% leisure/ visiting friends and

relatives/ immigrants

Destination Selection

1. Nature and environment 62%

2. Culture and art 53%

3. Safety 50%

INDIA

21

Top Destinations

1. United States

2. Neighbouring Countries + Caribbean

3. Europe (France, Italy, Germany, Spain)

Basic Information

- 590 million Latin Americans

- 85%+ speak Spanish

- Biggest potential in Brazil, Mexico &

Chile Motivators for Selecting a Destination

1. Proximity (ease of access, direct flights)

2. Language Barrier (Spanish)

3. Visa Requirements

Types of Tourism

1. City holidays (47%)

2. Touring holidays (27%)

3. Sun and Beach Holidays (12%)

Relevant Information

1. Outbound trips grew 22% since 2010

2. Outbound spending grew 28% since

2010

3. Biggest travel in Summer and Easter

Main Economic Indicators

- Expected growth of 3.4%+

- Increase Disposable Income

- Increasing Middle & High class

LATIN AMERICA

22

BENCHMARK:DUBAI

Fierce Competitor? or

Valuable Mentor?

23

PROFILE

Remains one of the most popular travel destinations in

the world

9.89 Million international overnight visitors in 2012…

Up 8.2% from ’11

What drive’s Dubai’s Popularity?

Place Branding & Cohesive Vision

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PLACE BRANDING & AND COMPETITIVE ADVANTAGE

Positioning

•Diversified economy

•Developed infrastructure (hard and tech), education, hospitals and tourism

Innovation

•Every project developed driven by continuous drive for differentiation and innovativeness

•Luxury, monuments, and record breakers

•Unified vision driven by government determination

Holistic Brand development approach & clear

vision

25

DUBAI BRAND DEVELOPMENT

Brand axes Strategic positioning Primary attributes

Business & Trade “Global business and

trading hub”

Specialized free zones, large

commercial venues

Tourism & Hospitality “Global touristic

destination”

Luxury hotels, state-of-the-art

architecture, leisure and

entertainment facilities, premium

services, heritage and cultural

attractions, ease of access

Events “Global powerhouse in

the events industry”

Sports and cultural facilities, leading

conference and exhibit centers,

complimentary services

Healthcare “Global healthcare hub” Integrated platform for heal thcare

and wellness services

Real Estate “Exclusive properties” Unique developments, green-driven

Entertainment “Global entertainment

destination”

‘It’s happening’- world-class concerts,

venues , innovative attractions

Dubai… a key benchmark!

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Dubai has built a diversified innovation portfolio to strengthen national brand based on strong government vision & strategy and support.

DUBAI INNOVATIVE RADAR

27

“This reflects the approaches of our government and its awareness

towards spreading this culture in a way that pushes the economic and

social development process forward and offers the opportunity for all

UAE citizens to create, innovate and participate actively in enhancing

the place of the UAE on all levels and in all fields”.

- His Excellence Mohammed Helal Al Muhairi

ROLE

to increase the awareness of Dubai to global audiences and

to attract tourists and inward investment into the emirate

RESPONSIBILITY

To organize the marketing of tourism and commerce for Dubai

DTCM is the key strategic thrust area of the national 2015 Plan

VISION:To position Dubai as the leading tourism destination and commercial hub in the world

MISSION:DTCM's mission is to strengthen the Dubai economy via

The development of sustainable tourism.

The provision of a unique visitor experience combining quality service and value for money.

Innovative promotion of Dubai’s commercial and tourism opportunities.

Further development of partnerships with our industry stakeholders.

ORGANIZATIONAL STRUCTURE IS FOCUSED ON CUSTOMERS

to interact with it efficiently to transact information and business.

TRAVEL TRADE INVESTORS VISITORS (BUSINESS AND LEISURE)

GOVERNMENT AGENCY 28

To demonstrate consistent innovative approach we analyzed DTCM business model, how national strategy properly

embedded:

Eco-tourism

Spa-tourism Education Tourism Sport-tourism

Business-tourismHealthcare-tourism

Cruise-tourism

DTCM responsibilities:

Licensing and classification of hotels, hotel apartments, tour operators,

travel agents and all other tourism services.

Supervisory role covers archaeological and heritage sites and to

ensure sustainable and responsible tourism for Dubai.

Training programs for personnel from the tourism industry to ensure

that Dubai’s tourism industry continues its world-class development

with world-class people involved at all levels.

PIVOTAL ROLE TO PROMOTE DUBAI ECONOMIC GROWTH AND PLACE EXCELENCE

THROUGH

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COMMUNICATION BENCHMARK: DUBAI ONLINE PRESENCE

30

And DTCM official web-site translates one strong message – the same as Dubai

Government web-site regarding national strategy

COMMUNICATION BENCHMARK: MONACO ONLINE PRESENCE

31

Compare to DTCM there is no clear message provided by Monaco Tourism

official web-site.

DUBAI: COMMUNICATING THE BRAND POSITION

•Unique cultural experience, that attracts all backgrounds.

•Clear, concise, and detailed explanations of experiences

•Unique marketing, available to all, and publications provided to the luxury market

•Luxury publications available in luxury hotels in target markets

Clear Brand Communication

32

VISIONSTRONG

COMMUNICATION

MONACO NATIONAL BRAND ANALYSIS

Current Capabilities

33

Monaco’s National Diamond

Source: Harvard Business School Analysis “Monaco’s Tourist

Cluster”, Porter, 2011

Source: Harvard Business School Analysis “Monaco’s Tourist

Cluster”, Porter, 201134

We examined Monaco’s economic performance and competitiveness both at the national level and the tourism

cluster level. One of the key message is Monaco does not have a good track record of registered patents, which

measures national innovative capacity, knowledge flow and government encouragement for business development.

There were only 10 patent and trademark registrations in 2008 (no public data for 2009-2013 yet)

Monaco Tourism Cluster Map

35

Tourism Cluster is very developed. But it faces stagnation and for the past years decline in demand: less

residents because of the financial crisis and their inability to pay high rents, the devaluation of the UK pound

(decrease in UK tourists), the expensive euro (decrease in US visitors), new competition (Dubai, Singapore) ,

“old” image of Monaco amongst the younger generations and resurgent local competition from Cannes and St

Tropez.

Source: Harvard Business School Analysis “Monaco’s Tourist

Cluster”, Porter, 2011

The Tourism Cluster Diamond

Source: Harvard Business School Analysis “Monaco’s Tourist

Cluster”, Porter, 201136

MONACO INNOVATIVE RADAR

Monaco lacks a well-balanced innovative portfolio to strengthen national brand.

Goals to attract target clients will prove to be difficult- vision communication must improve

Lack of Government communication and lack of Government Innovation

37

PROPOSED STRATEGIES & SOLUTIONS

Updating the Vision of

Monaco through Place

Excellence Analysis

38

PLACE EXCELLENCE MODEL

39

We suggest that before any recommendations for Tourism Office we need to look at the whole

picture on national Level –based on Place Excellence model.

NATIONAL LEVEL A nation’s competitiveness depends on the capacity of its industry

to innovate and upgrade. Government proper role is as a catalyst

and challenger: it is encourage –or even push-companies for

excellent performance (Porter, 1990). That is why we suggest:

1. to develop more robust and precise NATIONAL

INNOVATION STRATEGY and designed a strategically

balanced portfolio that between exploitative and the

exploratory:

PLACE EXCELLENCE MODEL (CONT.)

40

2. Reach out to the emerging markets of India, China, and Latin America by

lowering export restrictions for Monaco-based companies (we expect that the

Prince will be an Ambassador for the brand).

3. Eliminate company tax policies that favor domestic firms.

4. Eliminate labor hiring process and policies that “favor” Monaco citizens and

simplify hiring practices.

5. Create innovative context - unify the political leadership agenda and acquire

a solid mandate

6. Designed and implement strong communication & marketing strategy

through all national channels (digitalization national strategy) to strength

Monaco national Brand

PLACE EXCELLENCE MODEL (CONT.)

41

TOURISM CLUSTER LEVEL

1. Regulate against anti-competitive behavior between SBM holding and other

players to encourage a level playing field and increased competition.

2. Create special attractiveness policy to all target audiences from emerging markets

(multiple languages and appropriate labeling for attractions, tailored services in the

hotels & restaurants, casino etc.). On-going human capital training to achieve

excellent services.

PLACE EXCELLENCE MODEL (CONT.)

42

3. To strength cluster internal collaboration: help all sectors understand the true

needs of their industries, cooperate and better integrate their individual value

propositions to achieve increased overall competitiveness. IFC and Academia

need to be embedded to decision-making process (HBS, 2011).

Focus on innovative way for dynamic

clusters development

ALL ASSETS, ACTORS AND ACTIVITY NEED TO BE FIT

TO PROVIDE PLACE EXCELLENCE BASED ON HEALTH

BUSINESS, POLITICAL ENVIRONMENT WITH ENTERPRENERSHIP SPIRIT

Eco-tourism

Spa-tourism Education Tourism Sport-tourism

Business-tourismHealthcare-tourism

Cruise-tourism

DTCMONACO

Proposed Solutions

1. Communications Strategy

2. Accommodation & Hosting Policies

3. Expanded Partnerships

4. Cultural & Event Policies for Strong Brand

Perception

PIVOTAL ROLE TO PROMOTE DUBAI ECONOMIC GROWTH AND PLACE EXCELENCE

THROUGH

“ONLY MONACO”

COMMUNICATION STRATEGY

1. Updated digital “portal” tied closely with Monaco’s vision

2. International publications targeted towards clients in home countries

3. Improved media preference. Television, movies, and partnerships with target countries

4. Digital Applications- multilingual and targeted

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SPECIAL THANKS TO OUR CONTRIBUTORS:

H.E. Henri FissoreAmbassador Prime Minister Office, Monaco

Axel HoppenotExecutive Vice President, Sales & Marketing Monte-Carlo

SBM – Hotels & Casinos

Jean-Claude MessantManaging Director of the HOTEL METROPOLE Monte-Carlo

Aymeric PazzagilaAdministrator MWBO

Jorgen ErikssonFounding Partner of Bearing Consulting Group

Katerina TerentyevaUAE IUM MBA Alumni

Mandirra PuriIndia/UAE IUM MBA Alumni

46

1. www.imsee.mc

2. www.monaco-welcome.mc

3. Global Competitiveness Report 2013-

2014,

http://www.weforum.org/reports/global-

competitiveness-report-2013-2014

4. World Trade Organization Report 2013,

http://www.wto.org/english/res_e/reser_e/wtr_

e.htm

5. Harvard Business School Analysis,

“Monaco’s Tourist Cluster”.

http://www. ibobel.pbworks.com

Key Sources