If there's one Colombian city that has benefitted from the country's upsurge in tourism, it's Cartagena de Indias. With more than 30% of its workforce involved in the industry in one way or another, the charming Caribbean city of 1.4 million is reaping the rewards of a savvy nation branding campaign, tax incentives and improved security. In share contrast to just a few years ago, local and foreign tourists arriving by buses, planes and cruise ships now flock to Cartagena's seven miles of walls and the towering San Felipe fortress, relics that look much as they did in the 17th century when the Spanish built them to protect an important port and way station for ships taking silver, gold and emeralds from the New World to Spain.
But tourism has hit a speed bump this year. After years of double-digit increases, cruise ship calls in Cartagena are slated to decline by 17% in the current October-to-June season, according to the city's tourism office.
That's a big worry not just for Cartagena, but for the entire country. According to Commerce Minister Sergio Diaz-Granados, tourism is a pivotal part of Colombia's revenue, generating US$2.8 billion of foreign exchange this year, the third-biggest source of export revenue after oil and coal and nearly triple the amount a decade ago. And while airport arrivals of foreigners have flattened, visitor spending nationwide — after a burst between 2003 and 2007 — has settled in the range of overall economic growth of between 4% and 5%, according to Camilo Perez, chief economist at Banco de Bogotá.
Some of the reasons for tourism's slowdown are beyond the country's control: The global economic malaise, high fuel prices and a weak dollar forcing many U.S. tourists — by far the country’s biggest foreign visitor segment — to stay home. As for the decline in ship calls, that can be attributed partly to cruise liners being redeployed to meet higher–margin European and Mediterranean travel demand, says Luis Ernesto Araujo, Cartagena's tourism director.
Getting to 'the Next Level'
However, many Cartagena locals agree that other factors are of Colombia’s own making. They point out that tourism in other South American destinations, like Peru's Machu Picchu and the beaches of Brazil, is booming this year. In contrast, the shine is coming off Colombia, with a disturbingly high number of visitors surveyed in Cartagena — the country's most popular vacation destination — saying their holiday in the city has been disappointing. Just as sobering is this year's World Economic Forum study of global tourism destinations, which ranked Colombia a lackluster 77th overall and 13th among Caribbean and Latin American countries.
That has sent alarm bells ringing among local tourism officials. Suddenly, they have a challenge that's as daunting as the one from several years ago when their country had become synonymous with the deadly violence of drug lords and guerillas. How well officials — and entrepreneurs — meet the latest challenge will determine whether Colombia can maintain, if not grow, its share of the global tourism market, says Germán Arturo Sierra, rector of University of Cartagena and an expert in tourism management.
But it's a tall order. “Colombia has to stop improvising and design a comprehensive plan for tourism,” says Sierra from his office in Cartagena’s old city. “The plan has to involve all elements of society — the public and private sectors and the communities. And it has to assure that tourists aren’t just satisfied, but that their experience rises above expectations. If it can’t devise and execute such a plan, the industry will never go to the next level.”
Not a Good Feeling
A decade ago, Colombia was the antithesis of a mainstream travel destination. Leftist rebels controlled one-third of the land, and kidnappings averaged more than 10 a day. Colombians didn’t dare drive to a rural weekend getaway for fear of being caught in one of the rebels’ roadblocks. Add the barrage of horrific headlines about drug trafficking violence and little wonder that Colombia had a tourism industry that was going nowhere fast, only managing to attract “backpackers and thrill seekers,” as a former U.S. ambassador to the country once put it.
“Tourists’ first requirement is that they feel safe,” says Rodrigo Maldonado, director of Contactos, a Cartagena-based travel agency and packaged tour provider. “Until 2002, Colombia couldn’t offer that feeling.”
That year marked the beginning of hard-line President Alvaro Uribe’s eight years in office, a period in which Colombia’s armed forces steadily won back control of most of the nation. They were helped by US$7 billion in mostly military aid from the U.S. under Plan Colombia, an anti-drugs and terror package. Although the conflict is far from over, homicides and kidnappings are now less than one-tenth what they were during the dark days, and Colombians generally feel much safer.
To get the word out that security was improving and educate foreigners about what Colombia had to offer, a group of businessmen launched a nation branding campaign in 2006 called, “Colombia Is Passion.” To orchestrate it, they hired David Lightle, a well-known U.S. marketer whose other clients included the Republic of China and Thailand.
The centerpiece of Colombia's new campaign were TV ads in North and South America with famous Colombians, such as pop singers Shakira and Juanes, extolling their country’s virtues. The campaign also had testimonials from foreign tourists, often filmed against spectacular natural backdrops, describing why they were seduced by the local beauty and friendliness despite their preconceptions. The testimonials invariably ended with the declaration, “The only risk is wanting to stay.”
“The strategy was to take people’s perceptions of Colombia as a dangerous place head on," says Wharton marketing professor Cassie Mogilner. The idea, she recalls, was to "persuade them there had been a shift in how safe it was under Uribe, that the country had changed for the better. They wanted perceptions to catch up to the actual product.”
But was highlighting the negative aspects of that product a good idea? “Given that awareness of [Colombia’s violence] was already so high, consumers seeing the ad would have thought of it even if they didn’t mention it,” Mogilner says. Five years into the program, Colombia’s “bull by the horns” marketing campaign has been a success, she notes. “It has increased travel so that people can come back [home] and say, ‘It’s a lot safer,'" and talk about the culture, food, white-sand beaches, picturesque Andean mountain range and other natural treasures they experienced.
But there are hazards with such campaigns, she says. Colombia’s rebranding campaign worked for the same reasons that a similar Oldsmobile campaign to appeal to a younger market failed. “[Colombia's campaign] highlighted the barrier that consumers had in their minds for why they wouldn’t go to Colombia, and offered a product that was much more safe than people perceived it to be, while showing its coffee culture, history and beautiful nature." But Oldsmobile and its slogan, “Not your father’s car,” only pointed out what it wasn't, not what it was, "and in the process alienated the generation that did own the car by painting it in a very negative light.”
Room to Grow
Shortly after inaugurating the campaign, Colombia addressed a more tangible thorn in tourism's side: A severe shortage of hotel rooms. The key change — a new law that exempts new hotel developments from income taxes for 20 years — seems to have worked. Once turned off by Colombia's troubled image, international chains in the country now include Melia, Holiday Inn, Marriott, Ibis and Westin, and are part of plans to add up to 6,000 rooms across Colombia, with about half destined for Cartagena.
The Commerce Ministry also initiated a program to bring dozens of foreign travel agents and tour packagers to the country each year. Before such efforts, Stephanie Schneiderman, owner of Michigan-based tour packager Tia Stephanie Tours, says Colombia had barely registered on the tourism industry's radar screen. Now, she wants to “get in on the ground floor.”
Schneiderman, whose firm markets cultural tours to Mexican American and Afro American travelers, says she was impressed with her whirlwind tour of Colombia's Pacific coast and Guajira peninsula rich in marimba music, whale watching and handcrafts, and hopes to soon offer tours there — "African Americans want to learn about the diaspora of former slaves in other countries as well," she notes.
Real estate in Cartagena is also benefitting from the country's latest tourism push. Residential projects marketing luxury condominiums to Colombians and foreigners who want vacation homes have been proliferating. That includes Karibana, a 900-unit housing and hotel development eight miles northeast of the city featuring a Jack Nicklaus-designed golf course, which is nearing completion. Developer Megaterra of Bogota says it has modeled Karibana on the region's exclusive tourism-residential projects, like Cap Cana in the Dominican Republic and Mayakoba in Mexico. “Cartagena is like Cancun [in Mexico] was 30 years ago,” says Joseph Mildenberg, a 28-year-old Colombian and Megaterra executive. “The potential here and all the way north along the Caribbean to the Guajira peninsula is unlimited.”
'Still a Stigma'
However, talk of a tourism boom may be premature. The World Economic Forum’s ranking of global destinations showed Colombia’s tourism industry contributing only 1.8% of the nation’s total economic output – a far cry from the industry's contribution to other economies in the region, like Costa Rica (5.7%), Panama (5.6%), Mexico (4.4%), Peru (2.8%) and Brazil (2.4%).
Banco de Bogotá's Perez says a handicap for Colombia is that it lacks a flagship destination like Machu Picchu to differentiate from other regional destinations, “although we have been promoting Cartagena as one.” Perez also notes that guerrilla attacks and drug trafficking are “still a stigma, even for those who know security has improved here.”
The recent dip in cruise ship traffic has caused some soul searching among Cartagena tourism executives who, after several boom years, are not accustomed to bad news. To address the dip, some say Cartagena needs more direct international flights; others say the city’s hotels should start charging a room tax so that it can set up a convention and visitor center that can help market the city internationally.
There's also room for local entrepreneurship, says Toya Maldonado de Espinosa, owner of Tierra Magna, a local guide and tourism logistics company. She's been surveying cruise ship passengers and has found several recurring themes — one is that the historical part of the city lacks basic amenities ranging from clear signage to bathrooms to guidebooks. “We found that people arriving on cruise ships were taken to see the walls and the fortress without learning the history," Maldonado says. As a result of the surveys, she invested US$150,000 to develop audio guides in five languages, which tourists can rent at hotels. It's one way helping to fill the void, she says, “but the private sector can’t do it all.”
Universityof Cartagena's Sierra adds that Cartagena needs an even bigger action plan for tourism to address the issues Maldonado's surveys raise, everything from street vendors and sewage treatment to community education about the benefits of tourism. “The plan would define the vision of what we want to offer tourists and how to go about providing it,” Sierra says. “Now that we have succeeded in attracting this flow of visitors, we have to take better care of them.”