Don’t look a gift horse in the mouth

ASEAN’s new tourism website http://www.southeastasia.org goes from soft mode to a full content launch at ITB Berlin this week.

Based on the preambles and advance publicity, the project’s architects have set a high benchmark claiming it will drive millions of new visits to the 10-country region officially known as ASEAN.   

Actually, in the ITB launch publicity, the experts identify the “10 countries of Southeast Asia” as the beneficaries of their efforts. Wrong, there are 12 nations in the geograpical region (add  Papua New Guinea and East Timor) and just 10 in ASEAN. (Brunei, Cambodia, Indonesia, Laos,  Malaysia, Myanmar, Philippines Singapore, Thailand and Vietnam.)http://en.wikipedia.org/wiki/Southeast_Asia

That’s because the ACE project director dabbled in pedestrian research on the word ASEAN and concluded no one had the faintest idea what it represented.  He googled Southeast Asia and discovered millions of references and then lo and behold he picked up a copy of Lonely Planet’s guidebook, Southeast Asia on a Shoestring.  He asked “Did anyone publish Asean on a Shoestring?”   Done and dusted. ASEAN was trashed from the marketing promotion, all over a few beers in the Soi 8 Pub in Bangkok.

The website is part of a wider tourism project that goes under the ASEAN Competitive Enhancement project (ACE) that will sink US$4 million of US taxpayers’ money into promoting tourism to the region until 2013 when the five-year funding ends.

USAID is backing two projects simultaneously – one for tourism and one for textiles— at a cost of around US$8 million. USAID’s regional office in Bangkok assigned the management of both projects to Nathan Associates Inc, registered in the US, but with operational offices in Jakarta and Bangkok.

The hallmark project in tourism is http://www.southeastasia.org that was soft launched during the Asean Tourism Forum in Brunei, last January.

This week, ACE executives are enjoying a trip to Berlin to hand out stickers to all the Asean-member country pavilions at ITB, while promising the earth and more at a press conference for international media on  Friday, the last trade day of the show.

US taxpayers will ultimately pay for the European launch junket, which is questionable as the stated target audience for the campaign is Asia Pacific.

But as ancient gurus often say “the devil is the detail.” When the hype has settled will this US$4 million gamble benefit Asean tourism or will it fizzle into obscurity like so many elaborately promoted websites before it?

Although the ACE project director, RJ Gurley, was a new comer to tourism in ASEAN, he recruited ex-Pacific Asia Travel Association executives for some of the key activities. Much of the success of the website will depend on former Pata executive, David Gillbanks, to develop content and he has already been busy posting questions on the forum and remarkably answering them too.

The public relations project that covers the first year, until this July, represents a contract with an estimated value of US$70,000 that was won by former Pata communications director, Ken Scott, who owns the PR agency ScottAsia. He bid against two or three other Bangkok-based public relations outfits.

Another former Pata vice president of operations, Michael Yates, wrote the marketing strategy plan back in mid-2009 through his company Taramax of Hong Kong. Some of the initial marketing input in late 2008 was penned by yet another former Pata vice president, Peter Semone, who is now heads a Lux Development project in Vientiane, Laos.

These “school tie” links might suggest to cynics that the overall pool of talent in the region was dangerously shallow forcing Mr Gurley to fish in the small Pata pond. But it also confirms the power of Pata networking particularly if you have worked for the organisation, rather than just paid annual dues.

USAID should be taken to task for its role in this project from the outset. We may see the value of a government aid programmes that support village-based tourism, training, protection of heritage and the strengthening of sustainable tourism values. There is certain moral high ground for using taxpayers’ money that aids such lofty pursuits.

However, it quite difficult to get your head around the rationale for building a commercial website to simply duplicate what  governments and private sector companies in Asean have accomplished on a commercial scale for years with great success.

For quite different reasons, some ASEAN techies, who run booking websites, are genuinely shocked by this initiative. They have reason to be concerned. They don’t have US$4 million to splurge on public relations, expensive launches at ITB, huge investment in editorial content and marketing campaigns to drive visits to the site.

Many of them have just survived a two-year free-fall in bookings in Asia that seriously dented their capital, so they correctly view with suspicion when they see USAID funds  giving a single company a competitive edge to rise to the top of the pile.

Early in 2009, USAID’s primary contractor Nathan Associates Inc identified Singapore-based Wego.Com as the best option to run the meta-search engine feature and build a travel planner for www.southeastasia.org. Wego, Nathan and Aseanta, the private-public sector trade body representing the region, entered into a “global development alliance” that apparently doesn’t need a full-blown bidding process, according to USAID procedures.

Wego.Com can claim to be the only meta-search engine based in ASEAN, commanding around 1 million visits a month, so criticism by a few marginal players is written off as sour grapes.

It is highly likely that if Wego plays its cards right the link to the USAID funded SoutheastAsia.Org website will raise its company valuation, give it significant increases in content and build aggregate visits to the point it where it will dwarf all its potential rivals in ASEAN.

In the wider context of Asia/Pacific, it is not the largest player by a long chalk. In China and India there are meta-search sites that garner 20 to 30 million visits a month. Meta-search engines rely on volume — aggregate visits to the point you can sell advertising and generate a steady revenue stream from referrals or click-ons. Wego splits revenue with a variety of partner websites and SoutheastAsia.Org is just one channel that also includes a stable of News Corp print and online newspapers in Australia.

If all goes well, SoutheastAsia.Org will become the leading consumer website for the region. Bolted to the Wego search engine through a travel planner, it is expected to earn significant revenue enough to replenish Aseanta’s depleted coffers and fund a full-fledged Asean Tourism Centre to be located in Bangkok.

That’s the theory based on Wego’s premise that the site will soar within a year to attract consumer visits of a minimum of 100,000 a month. If it does its architects believe it will earn around US$9,000 a month for Aseanta in a split revenue share.

To achieve that benchmark, USAID will spend US$500,000 on a marketing campaign to be managed by the Singapore-based Qais Consulting, which has built the website at an estimated cost of US$25,000 in its bare-bone format.

Even at US$9,000 a month, which is quite significant for an almost penniless Aseanta, the website will be stretched to earn a surplus  to also cover a tourism centre and management costs for editorial content once the USAID pulls the plug on website funding at the close of 2013.

To avoid refinancing, the website would probably need to generate at least 500,000 visits a month in order to generate enough advertising and booking revenue to be self sufficient.

That brings us back to the beginning. Why would USAID want to fund a commercial venture that will ultimately compete head-on with hundreds of private sector commercial websites and booking engines?

Then factor in the national websites hosted by each of the 10-member countries such as Singapore, Thailand and Malaysia. These are the tigers of tourism. Surely, if they wanted a “regional website” they have the tourism pocket money to do it.

But they didn’t. That is because they all have their own priorities in tourism marketing and an Asean-wide website might be viewed as a diversion that dilutes traffic from their national sites and subsequent visitor-related data that comes with it.

We might wonder if ACE executives got it wrong from the word go?  They rushed in where other fears to tread. They may have  failed to recognise that they are offering donor aid to a region where tourism is a financial success story that the US could learn from. Not the other way round.

Now, they must ensure that their creation delivers the projected numbers and fast. If in 2013 it fails to garner significant increases in tourists to member countries, there will be insufficient funds to sustain its survival. There are no guarantees that national tourists offices will step in take over the financial burden.

Of course, Asean officials will not say a word if the initiatives falls short of its goals. It was free, courtesy of US taxpayers. Why look a gift horse in the mouth, they will say.

They should if only to ask if the horse has a healthy set of teeth to go the distance.

Apparently, no one has bothered to ask about post-2013 when this website must stand on its own two commercial feet or die.  Long-term success could depend on  whether ASEAN’ is  prepared to match every dollar that was spent by USAID to grow and maintain the site through 2020. Short of that it might fade into oblivion, like so many well-meaning projects.