By John Grant
It’s no secret that the Caribbean is known for its tourism, and Aruba is no exception.
In fact, 75 percent of Aruba’s GDP is from tourism dollars alone. However, with the U.S. lifting sanctions on Cuba to open up a previously closed tourist destination, the Caribbean islands face increased competition and risk losing tourism dollars to this new market. U.S. travelers that frequently visit Aruba may instead elect to travel to Cuba for their holiday, which could cause a decrease in transactional volume for the island.
While the island is planning to increase airline traffic this summer to Las Piedras and Porlamar, Venezuela; Quito, Ecuador; and Manchester, U.K., Aruba still has a lot of room for growth. An OAG report shows that Aruba is the seventh-largest Caribbean market for tourism, indicating that in order to secure a position in the top five, it has compete with larger islands, such as the Dominican Republic and Puerto Rico. So, what can airport and tourism officials in Aruba do to help increase the country’s market share and stand out from the competition in this shifting landscape?
Increase marketing in underserved markets
For tourism officials in Aruba, the goal is to gain market share from competing destinations.
The opportunity to capture more market dollars already exists in established routes; flights connect to Aruba from more than 41 countries and more than 169 cities around the world. Tourism officials in Aruba should consider aggressively advertising in underserved U.S. states, such as California and Washington, in order to increase new passenger traffic to the country and increase visitor retention by encouraging repeat visits after their stay. Highlighting what makes Aruba unique will entice tourists to travel from the West Coast where Hawaii and Mexico may seem like better-suited vacation destinations due to their closer proximity.
Additionally, travel to Aruba from Europe, specifically the Netherlands, has dropped by a third in the past five years. This is another opportunity for tourism officials to re-engage this market and put Aruba back on the map as an ideal holiday destination for European travelers.
Entice service from airlines
The major airlines serving Aruba include American Airlines, Aruba Airlines, Delta Air Lines, Insel Airlines and United Airlines. Historically, many flights to Aruba from the U.S. connected through Miami, with lower frequency services from additional U.S. cities. The tourism board and airport should encourage increased frequency during the off-season from major U.S. hubs and introduce new routes to the island to encourage travelers to book a trip. For example, as the result of the American Airlines and US Airways merger, direct service to Queen Beatrix International Airport (AUA) from Charlotte, NC and Philadelphia, PA has increased in the past five months.
Additionally, OAG found that Buenos Aires is the largest unserved originating location. This shifting airline capacity and route strategy for the Caribbean islands is an opportunity to capitalize on local and connecting air traffic, and can offer airlines and airports more business development activity. Airport officials must work closely with the leading airlines to ensure mutually-beneficial routes; if Aruba can position itself as a leading tourist destination in the Caribbean, airlines may see greater opportunity to increase revenue by increasing service to the island.
As Cuba enters the tourism market and encroaches upon airline service from the U.S. to the Caribbean islands, tourism officials will have to be increasingly creative and explore new possibilities to solidify their share of the tourism market.
John Grant is a senior analyst at OAG.