Hello and welcome to Episode 6 of the High Yield Tourism Podcast. I’m Gary Bowerman. On today’s show, Jens Thraenhart and I are delighted to welcome Jon Mamela, Senior Vice President and Chief Commercial Officer of Travel Alberta. One of Canada’s 13 provinces and territories, Alberta is promoted as Canada’s wild side. Located in Western Canada, it is home to prominent destinations such as Edmonton, Calgary, Banff and the Jasper National Park. And Travel Alberta is now embarking on a new strategic approach as the province positions tourism as a key pillar of its economic diversification plan. So let’s get started. This is High Yield Tourism. So Jon, thanks for coming on to the show. How are you doing today? And where are you right now?

Great to be here, Gary. I’m in Edmonton, Alberta, the capital city of Alberta here in Canada, based sort of in the central part of the province. Sorry, central part of the country. And it’s summertime there. You’ve got hot weather. It is. It is a lovely sunny day here. Beautiful blue skies. And I couldn’t complain. Taking advantage, full advantage of our summer. Long, long days and shorter nights, as we say at this time of the year. So absolutely beautiful day here.

Sounds great. Okay. So we’ve got plenty to talk about over the next 30 minutes or so. Let’s start with talking about Travel Alberta. Now, you’ve shifted from being primarily a marketing organization to a destination management organization. Can you tell us a little bit about what that means and what that says about the changing nature of the business of tourism? Yeah, certainly. It’s been

It’s been an interesting journey of the organization, even my time with the organization. To step back for your listeners, the organization is a crown corporation of the provincial government and responsible historically purely for the role of marketing. And I was in that capacity a little over a decade ago. And coming back to the organization in a new capacity, which we’ll talk more about here, the organization, to the benefit of the government, recognized the opportunity in front of itself that the pursuit of economic diversification was important to the current government and it still is. And just for, again, for your listeners, we’re a predominantly, you know, heavy petro-nation in terms of oil and gas and mining and the like. And the opportunity of tourism to grow that sector was one in a prioritized focus of the government. And so a change came in late 21, 22 that moved us to a holistic destination management organization with a broader mandate. In that mandate, responsibilities for not only maintaining marketing, but also incrementally taking a look at how do we drive an incremental look at access, getting to the destination of Alberta here in Canada, and also building and developing place and working with communities, entrepreneurs, developers, and operators to build a sense of place and a broader offering of accommodations and attractions. And so it was motivated primarily on a recognition of diversification of the government’s focus on the economy, alongside with also smartly identifying that all under one roof, a focus of growing and working with others in moving the sector forward was far better than having distributed responsibilities amongst various departments of the government or, in our instance, a crown corporation. And so a smart move that’s paid off in spades. And we’ll talk a little bit more about that during this discussion. What it shows in terms of the impact of tourism or taking a look at tourism is a one-sided push of looking at just driving demand can lead you in a very precocious situation of not considering what’s happening on the supply side with community vitality. And so it was a smart move to take a look at and seeing that if we’re going to effectively grow the sector, compete against other destinations, and drive a strategy forward, that holistic look at the entire ecosystem of the visitor economy was going to be important. Putting that again under one roof was key to our success.

For a little bit more context, Jon, you’re based in Edmonton, but Alberta, Canada’s wild side, you’ve got some of the most beautiful tourism destinations in the country there to promote, right?

We certainly do. It’s a destination that is incredibly blessed with topography and history, indigenous culture as most possibly well-known well, for Lake Louise, Banff, Jasper through the Canadian Rockies is the jewel in the crown of what most destinations would be envy of that are well-known globally. And so we’re very, very blessed with that. And incrementally beyond that, though, fantastic two cities, gateway cities of Calgary and Edmonton, alongside with a lot of other great, fantastic areas to explore, particularly an outdoor adventurous and enthusiast. This is a playground for anyone. And, you know, we also have one of the world’s most well recognized and known dinosaur beds, two in fact, one in northern Alberta and one further in southern Alberta. So no matter your interest, arguably, but certainly a passion towards outdoors is one that we really revel in and certainly speaks to Canada’s wild side to get out and enjoy the wild.

So let’s talk about talk about strategy. You referenced there sort of the starting point for this new strategy earlier in the decade. And you set strategic goals for the period up until 2027, so a four-year window. Can you tell us about that? Why you’ve chosen to go for a four-year plan? I mean, some countries around the world are planning a little bit further ahead to 2030. Singapore in our region here in Southeast Asia is planning to 2040. Is there a reason that you’re taking it sort of incrementally?

Yes, absolutely. I’ll speak to the incrementality of what we’re doing specifically at Travel Alberta. But important to consider is that our province of Alberta alone at a holistic level for the government has a 10-year tourism strategy and outlook out to 2035. And that 10-year outlook, not as bold as maybe Singapore out to 2040, is one in which we play a significant role and a part in. The 10-year outlook and view for the government for tourism focuses on five primary areas, not in any particular order here a priority, but equally of importance is the product and the supply side, as I alluded earlier, leadership and alignment in a whole of government alongside with communities and residents, as well as having leadership at a local level. Indigenous, we’ll talk a little more on the importance on the indigenous development and growth of experiences and culture in offering access is our fourth pillar of our provincial strategy. Again, I was alluded earlier to the point of bringing visitors into the destination and getting them around the destination with ease. And lastly, people, important on the labor side. You can build all the demand without the recognition that you’re building a sustainable workforce and one that works economically within the province and for operators. And so within that collective 10-year outlook, the government alongside with Travel Alberta’s leadership is leading the charge to see us through. And the big part of that, sort of the outcome of that is a very bold and audacious goal to double the size of the visitor economy and visitor spend in just a short 10 years. And so we’re very bold and ambitious in this province and reflected in that strategy. And the work that we do at Travel Alberta, as you referenced, in sort of a three-year chapter, three-year outlook, a lot more sustainable or sustaining for us to keep an eye and focus in on the more near future and influence on the strategy we take. And we just completed our last three-year plan referred to as Bootstrap, which was synonymous with the times coming to us through the pandemic and pulling up our bootstraps and getting us through that. And now in our next three-year chapter and focus, we refer to as Wheels Up and Forging Ahead. And important to underpinning our strategy in alignment to the provincial-wide tourism strategy over the next 10 years with a focus on marketing access in place in particular.

Sure. I want to pick up on something that you said a little bit earlier there about positioning tourism as a pillar of economic diversification. That’s obviously close to our heart here at High Yield Tourism. Can you tell us how important is tourism to Alberta’s economy? And what are some of the economic benefits that you’re looking to drive over this new business strategy?

As mentioned in my opening, we are a destination or a province with which has been predominantly successful on the backs of being a petro-province and a petro-nation, no different than maybe Saudi Arabia, Norway, and many others that have relied on extraction-based industries. And it’s one in which, again, the diversification away or incrementally to it, sorry, is one of vital importance to the province. Taking a look at how important tourism is in context, it ranks fifth as an export sector of Alberta behind, and again, number one in terms of oil, gas, and mining. That’s $100 billion sector, and we’re about $3 billion in export revenue. So, you know, a factor of almost 30 to 1 is considerable, and one with which a better balance and opportunity could certainly be had with the province and the focus in on the sector itself. And so a lot of room to grow, one in which, you know, the benefits and diversification is, you know, tourism reaches many regions and corners and communities in our province. It’s one in which the opportunity and startup and the benefit of taking advantage of what we’ve been blessed with to bring experiences to visitors is one in which we believe we can take advantage, smartly take advantage of in a sustainable fashion. And it’s one in which many communities who are looking to diversify out of historical beneficial sectors are looking at tourism. In fact, work that was done by the government taking a look at where and how diversification could occur and what ways. Tourism was often noted by many a community on The View. Recognizing that the popularity of Banff, Lake Louise and Jasper is not what they want to duplicate, but want to capitalize in on knowing they’ve got some fantastic natural assets, incredibly hospitable folk people, blessed by what comes off the land for our culinary and our farm to fork. And the opportunity, again, to take advantage of the divisitation we have. And so it drives all year-round deployments. It can revive rural communities. It employs over 150,000 Albertans today and growing. And so it is a fantastic component or element of Alberta’s economy. And as we also say, you often don’t come to invest, live, study without first having had an opportunity to visit, be it for a conference, business travel, or leisure. And so it acts as a tip of the spear for economic prosperity and growth for a destination, business or travel, leisure. And so it acts as a tip of the spear for economic prosperity and growth for a destination as well.

So John, those are the benefits that you perceive and that you’re trying to drive. On the counterpoint to that, of course, there will be challenges as you drive this economic diversification of your visitor economy. What are the primary challenges that you’ve identified?

You can create all that you want and develop if someone isn’t A, aware, or B, can’t have the opportunity or easily access the destination. There are multiple choices around the globe for a traveler to take advantage of. And so we have to work very competitively in terms of particularly improving air access and our infrastructure on our product side. Specifically on aviation, you know, very, again, competitive sector and working with airlines. And we’ve been benefit from WestJet Airlines, which is one of Canada’s major air carriers here being based and housed their hub out of Calgary. And with a long term commitment that they’ve made has been incredibly helpful for a destination to incrementally grow air access in many international markets, cross-border markets, and within Canada, alongside with other carriers that have recognized international carriers, Canada being another domestic carrier, in looking at the destination and really seeing a rebound. And we’ve grown air access back in most of our historical 2019 levels in many of our markets, far faster than anticipated, again, to the benefit of WestJet. But we also play a very central role in helping grow that air access with an aviation investment fund that takes a look at identifying incremental growth and capitalizing and investing smartly where we can get a great return for that. So, improving air access through aviation is key. In addition, on the accommodation and product side, we took a really close look at part of that 10-year strategy I referred to earlier in identifying that bold, audacious goal by 2035, getting what is essentially $25 billion in spend up from the current little over $13 billion or just nearly $13 billion. That’s very aggressive. But to get there, we broke it down in terms of how much incremental seats we needed, where we needed additional hotels or rooms for that matter, where we would need incremental rental car stock or access into other means of transportation throughout the province. On the accommodation side, taking a look at the idea of how many additional rooms we needed, we even dove deeper in identifying out to 2030, 2035, where do we see the visitation possibly occurring if we have a successful destination development strategy working with communities, diversifying visitation seasonally and regionally. And taking a hard look, we actually do not have enough possible accommodation in some of these communities, even with what we have for inventory on the room side. And so identifying what that gap was, determining what we felt was also important in terms of the accommodation concept, what was going to work really well, and what could be possibly of interest to draw someone into a destination that might be not as well known. And in partnership with CBRE, would be probably around the globe, or definitely here in North America, real estate advisory, tourism consulting group, looking at what might be the way with which those opportunities pencil in and actually make financial sense for an investor and an operator. And so we’re well into that work and taking a really hard look at identifying how do we break this apart in ways that are manageable and achievable. It’s slowly but surely, but definitely core to us, while we’re outstanding and very successful in the marketing side, our access and our place are core issues that we’re tackling to get us to where we need to be.

I’ll bring Jens in in a moment. I think Jens wants to ask you a few questions about the markets that you’re targeting, particularly the high-yield markets. But just before we do that, I just want to touch briefly on funding and financing, because to grow the economy, it will require investment. You referenced that just a few moments ago. What’s your plan to combine private and public investment to grow the visitor economy?

Yeah, it’s a great question. You’re absolutely right. We’re not going to hit a $25 billion visitor spend targets in such a short period of time on organic growth alone. If we didn’t do anything, we anticipate we’d probably be anywhere between the range of 18 to 20 billion, leaving us far short of that target. And so, you know, recognizing that we have to spur interest into the sector and financial investment into new products and experiences and accommodation and transportation, we’ve been very focused, laser focused in on where do we see the opportunity to do so? Because there’s development restrictions and limitations in many parts of the province. If they’re a national park, for instance, that’s managed by the federal government of Canada, has very different jurisdiction and ability to develop. And so looking outside of that environment, alongside with what I alluded earlier, and taking a look at where we saw visitation to occur and accommodation supply required, that was wrapped underneath the close look at identifying where in the province what we defined as tourism development zones could we see developed in the future that held a lot of potential. over the next five to 10 years on how those regions and places have the opportunity to build and become equally as popular or attractive as what we have for our legacy destinations like Jasper, Lake Louise, Canmore, Calgary, and Edmonton. They’re not going to be the largest centers of demand or opportunity, but they can certainly play a far larger role. And in support of that, in making the business case, we’ve set up an investor concierge service here at Travel Alberta that works closely with investors, operators, developers, with a one-window-in approach into the province. We’re setting up service to provide everything from market data and travel analytics, feasibility and business case studies, regulatory experience, and knowing we can create a pathway and ease to get into development and making sure that communities and other areas of the province are open to the investment and breaking down any red tape or inability to develop. And so recently, just shortly starting up this service and one that we’ve just been at for the last year or two, but it’s been greatly received in terms of facilitation. And so we’ve set ourselves up as an economic development arm on my side of the business that I oversee in driving that, but also recognize as well our investment. And we do have investment funds that we manage and I oversee. Those alone won’t do the trick. We’re certainly going to need to have the incremental investment. And so we’re looking at the opportunity in talking to our provincial financial institution called ATB. They’re a significant lender in the market. Working with them to identify and recognize the opportunity to invest in tourism. Alongside with Indigenous opportunities with the Aboriginal Business Investment Fund. Looking to work more closely with them as they continue to look at opportunities to invest and support. Tourism being a sector they haven’t historically looked at and opportunity there for sure. And so we are recognizing that Travelabird alone isn’t a body with which is going to get the incremental billions of dollars of investment coming into the province. It’s going to be through private capital and making the case that a return, a strong return is here, but also the financial levers or support that can be provided by other financial institutions within the province are going to be critical, even at the federal level, the federal government. Working closely with Destination Canada on identifying how that support could also be done. investment argument and opportunity, getting on, you know, so to speak, on the ground floor of significant upside potential, but also having the partners around us and the financial institutions who are going to be playing a significant part in enabling success and de-risking of that investment.

John, I think this is a very impressive strategy. And just maybe to kind of dig a little bit deeper here, when you’re looking at targeting specific inbound markets for growth, and as you mentioned before, spend is a target as well. Looking at the US, the UK, Germany, and Japan, are you considering these as high-yield markets and what makes them a priority? And when you develop these markets or segments within the market, do you need to create new products and experiences, as you mentioned before, to really make sure that there is more spend in the market and that spend benefits the local communities as well?

Yeah, great question, Jens. Certainly right off the top, the US, UK, Germany, and Japan are certainly key target markets for us and definitely high yield. We, as possibly many destinations in your listeners, do a very comprehensive assessment of the market potential, everything from air access to historical outbound travel spend and average spend per trip, population growth, even looking at the limitations or impact of visa processing times or opportunity of visiting friends or relatives is also another poll. We look at a variety of factors, and those are just a few, to rank markets on a regular basis very closely and prioritizing in these long-haul markets that you noted again, the UK, Germany, Japan, certainly pop up near the top as well. And France is in there as well in a growing market that historically was visiting majority down east in Quebec, but are exploring other parts of the province. And so we do a very comprehensive look at where we see potential. And in those markets, you know, thinking about the customer to your point in terms of who we’re really appealing to and how do we do it and what do we do on the supply side. We have two identified priority segments by definition, Curious Adventures and Hotspot Hunters, built off of work that we’ve done in conjunction with Destination Canada and ourselves at Travel Alberta in identifying sort of the mindset and the interest of how they want to travel and what they want to do when they do travel and enjoy. spend considerable time and don’t mind with sometimes no particular itinerary in play or flexibility in their itinerary, whereas the hotspot hunters really take advantage of one-of-a-kind experiences connecting with the locals and really want to make as many stories as possible and then certainly almost travel sleep-deprived if they can to get the most out of the trip and go at a little bit different of a pace. Speaking to each of those takes consideration on what channels we need to be in that are relevant to reach those audiences. We’re predominantly in the earned media and travel trade channels. We don’t have the budget to be leading in consumer direct channels other than in the United States. And so we do rely very closely in conjunction and partnering with Destination Canada and our other partners, including Tourism Jasper, Bath Lake Louise Tourism, Tourism Calgary, here in Edmonton, Explore Edmonton, to go as Team Alberta in presenting a great Alberta story that really resonates through those channels. And then lastly, to the product, we do take a really close look at what are the priority anchors and drivers from an experience perspective that resonate the most within those markets? We have the product inventory and growth pipeline for those types of products. One of probably the highest interest driving anchor experience in winter for international markets looking to Canada is Aurora viewing. The Aurora Borealis, the incredible northern lights that we’re blessed with in having here in Alberta. You can get them in the summer, but certainly on a higher frequency or in color in the winter and it’s an area that with which respectfully other countries are doing far better and providing the product and the infrastructure to view those particularly amongst the affluent luxury travelers other parts of Canada have really leaned into this and have a bit of a lead start on us a little bit further north of us in terms of geography, but there’s no reason with which we can’t compete. And so working with, as I alluded earlier, with CBRE and local communities to build the business case around how a lodge, a viewing lodge, an outdoor adventure lodge in Northern Alberta could easily compete with what’s available globally and certainly stand out relative to what’s available in Canada. And so that’s just one minor example in terms of taking a look at what’s the primary product drivers and experience drivers, where do we see the opportunity to develop and build and how do we create the business case? And we do that across all other areas about outdoor adventure, indigenous products as well. And so it’s an ongoing, consistently assessed, developed, and certainly pursuit of financial investment into growing our pipeline of product. And so, yes, we’re smartly looking at it. It’s a long journey to get there, but one with which if we don’t put attention to it now, it’s certainly not going to solve itself on its own. So we’re starting to create the environment of interest and recognizing we’re going to compete and steal share from other destinations. It’s critical and important to our strategy.

We did mention Japan in that mix of markets. But, you know, what other Asian markets are you focusing on, especially on the high-yield market? And, you know, if we look at China, obviously China is now on everybody’s mind again. I know that Canada and Alberta, you know, have kind of moved away from the, you know, kind of mass tour groups and more into FIT and high-yield markets. Can you share maybe some examples or some learnings on really shifting a market into a high-yield market? You know, what’s involved in actually doing that?

So just off the top, certainly looking at Korea more than we’ve had before and to the benefit of having direct air access provided by WestJet into the market makes a considerable difference of potential for a market if the opportunity to fly direct is available. So Korea, in addition to Japan, in the Asian market is one of high interest and one where we have been far more bold in our investment and our focus. And China historically, yes, has actually been a market and was a very considerably sized market. And yes, it was a large tour business that would come through across the country or within the province that we benefited from historically. Currently, as it sits now, it is not, in China that I’m speaking to, it is not the potential that it used to be. We’re uncertain as to, and given the relationships between Canada and China overall, is one in which I think is having clearly a direct impact IT business coming into the country at much smaller levels than it used to be. We’ll still be there, but our focus certainly is one in which through a strategy of working with particular key accounts that are focused on the FIT side of their focus inside the market, alongside with really identifying where we need to be putting and positioning Alberta as a destination that, while yes, could still support a tour business, is really a destination to enjoy as an FIT traveler. our business is really a destination to enjoy as an FIT traveler. And so working through earned media and key content partners in the market to highlight and showcase, finding those content partners in travel trade that reach that FIT traveler is going to be key. And really then positioning the story and the destination in a way that make an FIT travel feel comfortable. And that evolution of travelers within a market who have the experience over time or have traveled elsewhere independently and don’t feel that, you know, the expectation or desire for traveling as a group, a larger group. And that’s often skewed towards a little bit younger travelers and, you know, those who’ve, again, gone internationally and traveled elsewhere. And so it really is, how do we reach them? Through which partners can we do so? And what channels? And then, you know, tactically, how do we present the destination? And so that’s been a predominant heavy focus for Travel Alberta over the years. But certainly one in which has lost its priority status of our current focus, given other conditions well outside of our control.

In the previous edition of the podcast, we discussed models for integrating culture, heritage, and community engagement into high-yield tourism with tourism leaders from Zanzibar and Cape Town, South Africa. Now, you’ve referenced a few times indigenous tourism, and obviously that forms part of that whole concept. What are you guys doing in Alberta to sort of better engage your tourism stakeholders and indigenous communities to bring them into the tourism fold and to make sure that they benefit as well as the rest of the province?

Yeah, no, it’s a fantastic question, Gary. And it’s one in which we take a great deal of pride and an approach that is one of due and full respect with the indigenous cultures and people, both First Nations and Métis Nation here in Alberta. We live by and pursue and also in partner with indigenous communities and entrepreneurs under the mantra of not about us without us. You know, that is what we fully respect of the Indigenous community. And it’s not one of appropriate misappropriation, but one of collaboration. And for, you know, the nations and maybe people to take the lead in bringing their stories, their culture, their food, their way of the land to the forefront. And so we’ve made it a historical investment, and I say historical to Alberta’s history, but also probably unlike most destinations in Canada. But we’re certainly trying to blaze some trails and showcase that our investment with Indigenous Tourism Alberta, the Indigenous Tourism Association and agency for driving and working with communities and entrepreneurs. We’ve made a three-year commitment and re-upped that commitment of significant multi-million dollar annual investment, enabling that partnership to prosper and flourish and working alongside with us. And as they say, take a walk with us and doing so, again, not getting in front of or misappropriating, but letting the nations and people lead. And so knowing that the interest in Indigenous tourism experiences are extremely high, like one out of three internationally and equally, you know, and sometimes even higher, six out of 10 out of France, maybe seven out of 10 in France and Germany, looking for that type of experience, we work very closely with Indigenous tourism Alberta and set a mutual goal to be a leader in Canada on growing that particular sector and led by the people themselves. And so it is one that’s done in very much in concert, one that we’ve worked with in identifying what the development opportunities of product and experience can be and working very closely in terms of how we present and how Indigenous Travel Alberta brings that story and offering. And so everything from product supply and growth, also working very closely mutually with ITA, Indigenous Tourism Alberta on the consultation and support for businesses to grow and expand and really allowing the people, the Métis and First Nations people to truly be the storytellers front and center and bringing their stories to life, both in our marketing channels, but also incredibly important by the offering that they have to provide visitors when they come on to their land. And, you know, a great success story, just exemplary of this is Métis Crossing, a highlight and one that’s driven and gotten great exposure by media, including Connie Nass, I think National and other geographic traveler from various markets. It’s a historical meeting place, not far from here, here from Edmonton of the Métis people. And they built a beautiful lodge, a learning cultural center, an opportunity to get on the land with white bison, which is very unique and very important to their culture and history. And, you know, really understand how the Métis people lived off the land and did so for so many years to go and enjoy that. And so that’s just one of many, many businesses here and entrepreneurs throughout the province to grow and recognizing that it’s not a desire or an interest of the province or Travel Alberta to ignore that history. Recognizing that there’s a lot to as part of reconciliation and opportunity of growth for that sector to be a big part and to allow them to lead and support from behind and partner with them. And so it is, we think, going to be a critical differentiator for Alberta. We’ve got to catch up. There are a few other destinations in the country that are certainly at a head start and leading, but we feel with the momentum of interest and focus and also passion of many nations interested in bringing their stories to the market, that we can be a conduit to help make that happen. And so very, very critical part.

Jon, it’s been fantastic to talk to you. We’ve got one minute left, so I’ll have to be quite brief and I’ll throw you a curveball just to finish. We’ve covered a lot of ground about your high-yield tourism strategy, which you’re embarking on, trying to grow and diversify the tourism economy. If we were to have this conversation in 12 months’ time, how far down the line would you like to be? What would you like to have achieved in 12 months time?

That’s a great question. I would say five particular items. One is a focus on developing growing all season resorts in Alberta. It’s something with which our competitors next door in BC and other parts of the country have and we do not have. And we know that’s going to be a high draw and appeal for high-yield visitors coming in. You know, I’d love to see significant, more or less more growth in the development plans and the opportunities of investment in those development zones that I alluded to earlier. You know, we have the incredible opportunity to continue to cement in the minds of visitors, potential visitors and many of the high-yield visitors and travelers in many markets with Canada’s wild side, you know, our story and narrative. And, you know, at the same time, and just mentioned last, in terms of our growing our Indigenous sector is going to be definitely key in the growth for us and, you know, tied to that as well. And everything I mentioned earlier in terms of our growth with all-season resorts and product is building our capacity and success with bringing in incremental investment outside from the province into the sector itself and growing our investor concierge service and lending and securing a lot more capital coming in to see that new product supply meeting the demands and interests of high-yield travelers.

Jon, it’s been a pleasure to talk with you. Thanks so much for joining us on the High-Yield Tourism Podcast.

Thank you for having me.