Thursday, October 28, 2010

Addendum to Hurriyet South Weekly Editorial

For some unexplained reason, my South Weekly editorial got swapped to the front page of the HDN&ER instead of my regular weekly column. And since it was about Economics as well, many of my loyal readers thought that it was the regular weekly.

But, as I told the HDN&ER web editor, it all turned out for the better, as the tourism piece was much easier-to-read than my regular piece, which are usually kind of technical for the average reader. In fact, I got + feedback in the form of a comment on the HDN website and a couple of emails. The comments make some important points, which I would like to address now:

A reader noted in an email (not disclosing names because I have not asked for permission):
I'm not sure whether we can just blame macro-economic developments for the downmarket tourists who come to the resorts nowadays. Although some tourists in Istanbul are eccentric, we don't get bunches of yobbos (lager lout synonym) as you do in Marmaris and the like. This is because these people are attracted to beach holidays. It was always so and when I was a teenager and went on family holidays to Spain, such people were around then. Of course price comes into it and if Emre hotels were in the Seychelles you might get less of the chavvy crowd but even chavs have money nowadays (aka Mr Rooney) so even that's no guarantee.
Sure, there is the "culture effect" as well, but controlling everything else (a term economists love), the lower your prices, the more likely you are to end up with lager louts. For example, Dogus owns the Mares Select on the way to Datca, a premium hotel charging a couple of hundred euros a night at least. I am sure they have to deal with less chavs than our place. Or I am sure even the Grand Azur, a five-star hotel almost a stone's away from us, has less yobbos. BTW, I am just practicing my new vocabulary, in case you are wondering:)...

Speaking of linguistics, a friend who grew up in the U.K. asked me what the following phrase meant: "'ave a butchers at ya tattoo then luv?" After learning English rigorously in high school for 7 years and spending more than a decade in the U.S., I am ashamed to say that I had no idea what this meant. It is supposed to mean "May I have a closer look at your tattoo ma 'm?"

But it is also important to make a disclaimer here: The same friend was asking whether a more refined customer wouldn't benefit more from E. Hotels? They surely would, and some of our guests are really nice middle-class guys from the U.K. It is the tattooed thugs (another new word) that spoil the mix. In fact, we get a lot of intra-nationality complaint during the season, and a couple of guests writing reviews over at Tripadvisor explicitly stated they were ashamed of their countrymen. Just so that you don't think I am being racist or anything:)

Anyway, to come back to serious matters, the same reader wrote about the employees as well:
As for the low cost employees...I agree with you about the seasonal element. The waiters who work near my house here are rather cool and know how to behave whereas when I went to Marmaris and was unaccompanied, I was harassed constantly by off duty (and even on duty) waiters. I'm not even sure the efficiency wage theory would help improve their manners. Ignorant is ignorant I'm afraid.
She is again partially right: I agree that even if you increase the cost of getting fired, you would not avoid shirking all the time. For one thing, I have come to accept that part of it is just ignorance, as the reader notes. But by paying higher wages, you can also attract more skilled/less ignorant workers, at least in the long run. But much of the problem is just the seasonality: You just can't hold on to the decent workers, who would prefer a hotel open year-around.

Finally, she proposes the obvious solution:
If I was a hotelier I would probably no longer follow the all-inclusive package and try to find some way to lure the punters to me promising a little extra quality for a slightly higher price.
She is definitely right, but that is unfortunately much easier said than done, especially if you are located in a town with too many hotels like Marmaris. Almost all the examples of hotels doing that don't have competition hanging on their head like the sword of Damocles. But I will have more to say on this issue below.

Moving on, another reader commented to the HDN&ER website:
The small town I live in (30 mins from Marmaris) is struggling to cope with the high valued lira, all inclusive hotels and the rise in food costs, rents etc. Quality of staff and client base has deteriorated constantly over the last 14 years and other than the 6 weeks (annual Brit holiday time) the whole sector is lucky to make a profit. The South West needs support from the government before the tourism sector is totally at the mercy of the major foreign tour operators.
It is nice to hear I am not alone:)... But I am not sure what kind of support would be appropriate. Cheaper electricity would certainly help, for example, but with the recent alcohol tax hike, we seem to be getting exactly the opposite. Well, we would have thought better before voting "no" in the Referendum:)...

But I see such as only partial solutions. Over the long haul, the hotels need to get their hand as strong as the tour operators, but that would only be possible through cooperative action. But game theory tells us that when the game is not repeated a lot and monitoring is limited, tendency to deviate would be very high. That's where government monitoring and support would be very useful. This is something on which I have been pondering of late and hope to share my ideas once I make them a bit more concrete.

Anyway,  another reader who wrote a comment to my blog says the following:
This is the story of last 20 years of the tourism in Turkey. For one reason to another hotels in the south and even in the cities have been manipulated by the tour operators, run by non financial operators and lost profits under all inclusive packages. Quantity is certainly important to keep the sector alive but we certainly need some strategies & planning for the mid and long term.
The last sentence is key. As I also hint above, that's what government support should be about. Not handouts, but long-term planning to help the sector move up in the value-added ladder. Of course, the key question is how, and I would like to devote a South Weekly editorial exclusively to this issue in the next couple of months...

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