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Mexico Tourism Board & the Outbreak of H1N1:

A $92 Million Crisis

Korinne Leonardis, Nicole Parker, Laura Reginelli & Adrienne Spector

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Table of Contents

Abstract…………………………………………………………………………………

…....3

Intro…………………………………………………...

…………………………………...3-5

The Mexico Tourism Board………………………...

……………………………...3-4

Economic

Importance…………………………………………………………………..4-5

The History of H1N1………………………………..

……………………………......5

Mexico Tourism Suffers…………………………………….

…………………………..…6-7

The Financial Implications of H1N1…..………………….

………………………………7-8

The Swine Flu Media Blitz…………………………….……………………………..

……8-9

The Timeline………………………………………………………...

……………………...10

The Campaign……..…………………………………………….…………..

………….11-12

Concluding

Statements…………………………………………………………………….12

3

Appendices………………………………………………………………………….

…..13-20

Works

Cited……………………………………………………………………………..21-25

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Abstract

In light of the hazardous health situation in Mexico, the United States Department of State alerted citizens on April 28, 2009 of health risks due to the outbreak of the H1N1 virus. The Centers for Disease Control and Prevention recommended that all American citizens avoid non-essential travel to Mexico until further notice. As a result, Mexico became a less appealing travel destination. By May 1, 2009, only three days after these statements were issued, Mexican hotels and resorts began to experience enormous drops in occupancy rates. American airlines with flights to Mexico and various cruise lines with stops in the country dropped nearly half of their passengers or had to suspend or completely cancel trips all together. Due to such low rates of tourist travel to Mexico, over 25 hotels temporarily closed down and offered some other guarantees and incentives in an attempt to hold onto their customers. In comparison to numbers in 2008, in conjunction with bad press and travel bans, Mexico experienced an 11 percent decline in U.S. visitors during this time. Since tourism is the third largest source of revenue for the country, the decline created an immense problem for the Mexico Tourism Board (MTB). In an effort to reestablish Mexico’s appeal as a tourist destination, the MTB developed a $92 million marketing campaign to restore the country’s appeal as a tourist destination across 12 U.S. markets and six markets in Canada. This case study examines the success of the campaign and its effort to restore Mexico’s image after an international health crisis.

Introduction

Mexico, The Mexico Tourism Board

The Mexico Tourism Board (MTB), also referred to as the Consejo de Promocion Turistica de Mexico (CPTM), promotes six tourist regions with nearly 40 tourist destinations, to travelers from all over the world. Founded in 1999, the MTB was developed as a sector of Mexico’s Tourism Secretariat. The MTB is the entity, which carries the responsibility of promoting the country of Mexico, positioning its regions as appealing destinations and highlighting its cultural attractions of the country to its publics across the globe. The MTB’s mission is to spread “the promotion, both integrally and competitively, of Mexico, its products and destinations, in domestic and international markets, by means of joint efforts involving all stakeholders in tourism.”i According to the Board’s vision they consistently seek to ensure that they are “a leading organization in the promotion of tourism, encouraging participation and joint efforts by the various stakeholders in the industry.”1

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The MTB oversees all aspects of public relations, marketing, advertising and promotions through its various functions assigned to the organization. According to the MTB’s official website these functions includeii:  To help design plans, programs, strategies and priorities for tourist

promotion To provide tourist information specialized for both national and

foreign tourists To obtain complementary, economic, technical and material

resources, for the development of its objectives To stimulate the participation of the public and all tourist activities

that promote the attractiveness and services of the country To create agreements with the governments of the Federal

Organizations and Municipalities, with state and municipal mixed organisms, and with the private sector (national and foreign), with the purpose of orchestrating campaigns of tourist promotion

To celebrate agreements of tourist cooperation with governmental organs and international organizations in order to promote tourist to the country

To make works and studies of market relative to the fulfillment of its objectives

The company is considered a government agency in the Leisure, Travel and Tourism Industry and is composed of fewer than 500 employees with offices in Europe, Asia and Latin American, and nine in North America.iii The MTB employees are divided among four different divisions within the organization. These divisions include: Administrative (74% of employees), Sales and Marketing (14% of employees), Research Development (3% of employees) and Executive Leadership (9% of employees).iv Within the executive leadership division for North America resides the following employees:

United States and Canada (North American) MTB Teamv:

Oscar Fitch, Former Chief Operating Officer at time of crisisii Visit Mexico: Mexico Tourism Board. (2008). Retrieved November 16, 2010 from

http://www.visitmexico.com/wb/Visitmexico/Visi_Informacion_CPTM

iii Rodrigo Esponda C. (2010). Retrieved November 16, 2010, from

http://www.linkedin.com/in/responda

iv Mexico Tourism Board: Overview- LinkedIn. (2010). Retrieved November 16, 2010 from

http://www.linkedin.com/company/mexico-tourism-board?trk=null

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Gloria Guevara Mazno, Current Chief Operating Officer and current Secretary of Tourism

Rodolfo Lopez Negrete, Chief Operating Officer Gabriela Ibarra, Deputy Director Northeast Clara Torres Márquez, Deputy Director of Public Relations for

North America Eduardo Chaillo Ortiz, Executive Director Meeting Industry Rodrigo Esponda Cascajares, Chicago Director Octavio Aguilar, Houston Director Jorge Gamboa Patrón, Los Angeles Director José Barquin, Miami Director Guillermo Eguiartem, Toronto Director Daniel Gutierrez Aguirre, Vancouver Director Amado Manuel Montelongo, Montreal Director

Economic Importance

Tourism is Mexico’s third largest source of economic revenue, with the United States and Canada as the main publics for travel to the country’s tourist destinations.vi According to the tourism ministry, in 2008, Mexico had 22.6 million foreign tourists and an accumulated sum of $13.3 billion in tourism revenue.vii Destinations such as Cancun and Acapulco were on the rise as hotspots for college spring breakers, but after the announcement of the outbreak of the H1N1 virus in Mexico and the various travel warnings in response, Mexico experienced the following declines regarding tourism:

32 percent decline in total international tourists 54 percent decline in international spending during May 2009

It was apparent that tourism and its important role in the revenue of the Mexican economy were in trouble.

The History of H1N1

In 2009, a new strand of influenza that would claim over 17,000 lives globally, took the world by storm.viii This new flu virus was named

vi Orourke Hospitality Marketing. (2010, October 5). Mexico Sees Its Most Impressive Numbers yet

With a 6 Percent Increase in Air Travelers in 2010, Compared to 2008. Retrieved October 15,

2010, from, http://www.orourkehospitality.com/media-room/news.php?sid=49168

vii Collins, H. (2009, February 22). Tourists Spent $13.3 Billion in Mexico in 2008 (Update1).

Retrieved October 16, 2010, from http://www.bloomberg.com/apps/news?

pid=newsarchive&refer=latin_America&sid=a.pWsXIi4jdM

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H1N1. Believed to have originated in pigs, the disease quickly became known as “swine flu.” However, after further research it was determined H1N1 did not begin as an animal virus.ix First reported in Southern California in March 2009, doctors were unsure of what they had encountered and the virus went on to claim its first life in Oaxaca, Mexico on April 13, 2009.x

At first glance, H1N1 was easily mistaken for the regular flu virus. The virus is spread from one individual to the next through coughing, sneezing and “touching infected objects and then touching your nose or mouth.”8 The symptoms of the virus can range from coughing and chills to nausea, vomiting, fever and head and body aches. Ultimately, the disease covered a significant amount of ground by spreading from one person to the next through bodily contact.xi Those that were at highest risk included young children, pregnant women and older individuals with frail immune systems. Unlike the common flu virus, most people had little to no immunity to H1N1 due to a lack of familiar antibodies. This led to a heightened increase in fatalitiesxii as the disease spread rapidly, with the majority of deaths in North America; predominately in Mexico.7

Since the virus was a new strand of the flu, preparation to fight back was nonexistent when the disease started to spread. Mexico, the origin of the virus, reacted by taking numerous measures including the closure of schools, the disbursement of sanitizer and face masks and

i Consejo de Promocion Turistica de Mexico. Mission and Vision. Retrieved October 17, 2010,

from, http://www.cptm.com.mx/wb/CPTM/CPTM_Mision_Vision

v Mexico Tourism Board: Our Team. (2010). Retrieved November 16, 2010 from

http://www.visitmexico.com/wb/visitmexicopress2010/our_team1

viii Stevenson, M. (2010). 1 Year After H1N1, Mexicans Question Response. Retrieved October 12,

2010, from http://www.msnbc.msn.com/id/36735684/

ix Caruthers, A. (2009). H1N1 Swine Flu: Background and Prevention Tips for Travelers.

Retrieved October 16, 2010, from

http://www.associatedcontent.com/article/1763142/h1n1_swine_flu_background_and_prevention.

html?cat=5

x H1N1: Meeting the Challenge- April: The U.S. Responds. (2010). Retrieved October 14, 2010,

from http://www.flu.gov/timeline/#event1

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the discouragement of “large public gatherings.”xiii The MTB went on to release tips and updates about the spread of H1N1 and how the government was reacting (See Appendix C). Over the span of the five months following the first death related to H1N1, the United States, along with several other nations, worked to create a vaccination to help put an end to the spread of the virus.

The FDA approved four types of vaccinations in September 2009 to combat H1N1. These vaccinations were single-dose and available for healthy children and adults. It is noted that children under the age of nine needed to receive two vaccination shots rather than one.xiv The vaccinations were available in several different forms including an oral application and a nasal spray.xv H1N1 ultimately would claim almost 18,000 lives worldwide and 1,185 within Mexico itself.10 As the disease claimed more lives, it also began to affect various sectors of Mexico’s market, especially tourism.

Mexico Tourism Suffers Extensive Damage

With tourism already on the decline from the recession and drug related violence, H1N1 only furthered the damage by creating yet another reason to halt travel to Mexico. In the face of this pandemic, the U.S. Embassy in Mexico was forced to issue a travel alert (See Appendix B). With the addition of the hazardous health conditions created by the H1N1 virus, accompanied by extensive media coverage and U.S. travel alerts, Mexican hotel chains began to experience a decrease in occupancy rates like never before. In an interview with The Washington Post, Monica Roberts, Director of Corporate Communications for Real Resorts, a hotel chain with locations in Cancun and The Rivera Maya, said that they were currently at 20 percent occupancy rates when they should be filled to 90 percent capacity.xvi

Airlines began cancelling flights rapidly for the same low occupancy problems. Continental Airlines slashed capacity on Mexico routes by half, saying that, “the demand was already soft before the flu outbreak and dropped sharply on the news.”xvii Smith Travel Research Inc., one of the leading hotel industry watchers, conducted preliminary research and found that many airline companies and tour

xvi Partlow, J & Booth, W. (2009). Swine Flu Devastates Mexico’s Tourism Industry. The

Washington Post. Retrieved October 20, 2010, from

http://www.washingtonpost.com/wp-dyn/content/article/2009/04/29/AR2009042904650.html

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operators were nearly slashing prices in half or giving out extraordinary deals in order to boost tourism back to the resorts with which they partnered.xviii

In addition to the financial decline that many hotels and airlines experienced during the scare, nearly a month later, online travel companies were still reporting that Mexico flight, cruise and hotel packages had dropped by 50 percent.xix In 2009, Expedia.com offered flights from New Jersey to Mexico City for $285 for a round-trip ticket, compared with $498 per round trip ticket in 2008.xx While this gave travelers some of the best deals they could snatch up in years, no one was taking advantage of it; the beautiful beaches of Mexico remained bare of tourists. According to Cynthia Martinez, spokeswoman for Royal Caribbean Cruises, “it is not necessarily the risk to the passengers. It’s more about whether our guests feel comfortable visiting Mexico.”xxi

Resort closures were a major problem during this period. As travel to Mexico decreased, over 25 resorts temporarily shut down or closed to avoid incurring negative operational costs.xxii Iberostar Hotels & Resorts, an internationally renowned resort chain with hotels in various tourism spots in Mexico, was one of the hotels to make this decision. According to a written statement from a travel site, Iberostar felt it was necessary to close down some of their Mexican hotels to maintain the “high level of service that Iberostar is known for.” Iberostar management worked to relocate their current and upcoming guests to other nearby Iberostar properties that were operating throughout the H1N1 scare.xxiii Other hotels experienced similar monetary issues. The lack of tourism nearly devastated over 300,000 families in just Cancun and Rivera Maya alone who depended upon tourism to put food on the table.xxiv

On the other hand, a select few resorts took an alternative approach. Karisma Hotels & Resorts, a chain of eight hotels along the coast of the Rivera Maya, were so certain in the health safety of their hotel that they promoted “flu-free guarantees.” Mandy Chomat, Vice President of Marketing at Karisma, said that in the event any guest contracted the H1N1 virus or felt sick during their stay through the month of June, they would pay for their doctor’s visits and give them the next three vacations for free at their hotel.xxv

On May 17, 2009, Formula PR on behalf of the Karisma hotel chain issued and posted a press release on the Karisma website publicizing the CDC’s removal of the original warning against non-essential travel to Mexico and promoting their new guarantee (See Appendix A). The release encouraged current guests and future clients

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to move forward and consider the true climate in Mexico. They gave reassurance through their statement, “beyond our contentment owing to further confirmation of the wellbeing and health of our guests and employees, we are very pleased to see the CDC consider the actual situation.”

Financial Implications of H1N1

The aftermath of H1N1 and its impact on Mexico left the economy battered and in dire need of improvement. The outbreak of the virus came at an inopportune time during the middle of a global recession. During the outbreak, it was relatively well known that the financial implications of the virus would be serious, but not debilitating. According to the Wachovia Economics Group, the three main areas that they predicted would be most affected monetarily by the swine flu included the agriculture industry, travel and tourism and the domestic demand of Mexico. During this time, there was an increasing worry that demand within Mexico itself would fall drastically due to the closures within both businesses and schools across the nation.

As for tourism, in 2008, the industry accounted for around 8 percent of Mexico’s economy or $13 billion in revenue.xxvi Tourism within Mexico is considered the “third-largest source of foreign currency behind oil exports and migrant worker remittances” and is seen as a main driver in the country’s economy. During April 2009, Mexico predicted that the economy would ultimately contract by 2.8 percent over the course of the year due to all the troubles the nation would face.xxvii Throughout the H1N1 outbreak, it was estimated that GDP would drop by 0.3 to 0.5 percent in total just due to a drop in tourism.

Percentages of rooms rented in hotels during the outbreak dropped sharply, causing revenue to fall even further. Mexico City reported that it was losing roughly $10 million per day as hotel occupancy slipped to around 10 percent during the crisis. In turn, hotels and tourism companies drastically reduced rates 50 to 70 percent in an attempt to attract or retain vacation-goers.23

Publicly held companies’ experienced serious declines in their value and stock prices during 2009. During this time stocks for airlines and travel-oriented businesses fell “as much as 13 percent” due to a number of cancellations and rising concerns amongst potential travelers and customers.xxviii

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Mexico’s national currency, the peso, was also hit hard by H1N1. As displayed in Appendix E, the outbreak of H1N1 caused the peso to dramatically weaken in value. Prior to the outbreak, the global recession caused the peso’s condition to worsen.

“The currency, which has plunged 32 percent in the six months through March 9 as Latin America’s second-largest economy slipped into a recession and drug violence increased, surged 12 percent in the six weeks before the government first reported the swine flue cases on April 23.”xxix

Despite the peso regaining some of its strength during those six months, it fell 5.1 percent on April 27, 2009 alone. In an attempt to stabilize the currency, Mexico’s central bank implemented a policy of buying up pesos to lessen the harsh effects. The International Monetary Fund (IMF) even went as far extending Mexico a credit line of $47 billion to assist the nation with its tumultuous economy.xxx

While the financial effects of H1N1 were not paralyzing to the Mexican economy, they still left a recognizable dent in a nation attempting to recover from the global recession. It was evident that H1N1 caused problems for Mexico’s economy that could not be overlooked.

The Swine Flu Media Blitz

The initial media attention given to the detection of the novel influenza was primarily focused on the health and well being of people. Since health crises can potentially affect humans from any part of the world, heavy emphasis in quoting sources generally rely on scientists and health professionals in the two organizations: The Centers for Disease Control (CDC) and the World Health Organization (WHO). Both of these organizations were major players and publics in the American media’s attention of the swine flu outbreak. During the time of the initial knowledge of outbreak, directors from these two organizations were quoted and within days numerous articles were published, making note of the tourism and economic effects Mexico faced in the wake of the health crisis.

The initial discovery of the outbreak sparked speculation from the media as to the severity of the new strain of influenza.xxxi Reporters mentioned that travel advisories were not instructing travelers to refrain from visiting areas where the disease was actively spreading. Before the WHO declared H1N1 a pandemic, many reporters stated that the CDC released information urging the public to take normal health precautions when traveling to Mexico or other affected areas.xxxii

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Because of its proximity to the Mexican border, local news reports advised residents in the San Diego, CA area to be aware of flu-like symptoms and to stay indoors until a physician was able to diagnose the illness. The reports included current information about the origin of H1N1, typical symptoms and possible vaccinations. Local reports also mentioned local H1N1 cases and what doctors and hospitals were doing to contain the possible spread to others.xxxiii

A source from Mexico’s Central Bank said that the tourism industry in Mexico has already seen a backlash from the outbreak. In turn, Reuters explained “many groups of foreign tourists and students on Wednesday left the country earlier than planned.”xxxiv Reporters from The New York Times informed readers that the U.S. declared a public health emergency over the recent detection and spreading of

xi Novel H1N1 Flu: Background on the Situation. (2009). Retrieved October 16, 2010, from

http://www.cdc.gov/h1n1flu/background.htm

xii What is the pandemic (H1N1) 2009 virus? (2010). Retrieved October 16, 2010, from

http://www.who.int/csr/disease/swineflu/frequently_asked_questions/about_disease/en/index.html

xiii Outbreak of Swine-Origin Influenza A (H1N1) Virus Infection. (2009). Retrieved October 16,

2010, from http://www.cdc.gov/mmwr/preview/mmwrhtml/mm58d0430a2.htm

xiv H1N1: Meeting the Challenge- September: FDA Approval. (2010). Retrieved October 14, 2010,

from http://www.flu.gov/timeline/#event6

xv H1N1: Meeting the Challenge- October: Distribution Begins. (2010). Retrieved October 14,

2010, from http://www.flu.gov/timeline/#event7

xvii Malkin, E. (2009). Flu? What Flu? The New York Times, retrieved October 30, 2010 from

LexisNexis Database

xviii Chen, S. (2009). CNN: Mexico’s battered image yields travel deals. Retrieved October 20, 2010,

from http://www.cnn.com/2009/TRAVEL/05/26/mexico.tourism.recovery/index.html?

iref=allsearch

xix Chen, S. (2009). CNN: Mexico’s battered image yields travel deals. Retrieved October 20, 2010,

from http://www.cnn.com/2009/TRAVEL/05/26/mexico.tourism.recovery/index.html?

iref=allsearch

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swine flu, but the declaration was more of a “standard operating procedure” according to Homeland Security Secretary Janet Napolitano. The article stated, “Other nations imposed travel bans or made plans to quarantine air travelers” as more confirmed cases emerged in Mexico and North America.xxxv

An article pertaining to the hospitality industry was released via the Internet addressing industry professionals about the current effects of the swine flu in tourist spots around Mexico. The nation’s capital, Mexico City, was described as a ghost town where businesses shut down operations during the initial discovery of the outbreak. One hotel

xx Chen, S. (2009). CNN: Mexico’s battered image yields travel deals. Retrieved October 20, 2010,

from http://www.cnn.com/2009/TRAVEL/05/26/mexico.tourism.recovery/index.html?

iref=allsearch

xxi Malkin, E. (2009). Flu? What Flu? The New York Times, retrieved October 30, 2010 from

LexisNexis Database

xxii Woolard, D. (2009). Luxist: Mexico’s Resort Hotel Offer Swine Flu Guarantee. Retrieved October

20, 2010, from http://www.luxist.com/2009/05/12/mexicos-resort-hotels-offer-swine-flu-

guarantee/

xxiii Pike, J. (2009). Travel Agent Central: Mexico Tourism Officials Monitoring H1N1’s Impact on

Sector. Retrieved October 20, 2010, from http://www.travelagentcentral.com/mexico/mexico-

tourism-officials-monitoring-h1n1s-impact-sector-14988

xxiv Myres, J. (2009, May 17). Center for Disease Control removes its original warning recommending

against nonessential travel to Mexico, [Press release]. El Dorado Royale: Formula PR. Retrieved

on October 20, 2010, from http://www.karismahotels.com/article/center-disease-control-removes-

its-original-warning-recommending-against-nonessential-travel

xxv Chen, S. (2009). CNN: Mexico’s battered image yields travel deals. Retrieved October 20, 2010,

from http://www.cnn.com/2009/TRAVEL/05/26/mexico.tourism.recovery/index.html?

iref=allsearch

xxvi Malkin, E. (2009). Flu? What Flu? Retrieved October 22, 2010, from

http://www.nytimes.com/2009/05/09/business/global/09peso.html

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source reported, “Tourism in Mexico dropped by 20% in the last weekend of April according to the Mexico City Hotel Association.” The hospitality newsletter briefly addressed the negative financial effects felt by hotels as a result of the stocks slumping in “reaction to the swine flu.”xxxvi

By the sixth official day of swine flu media blitz, The Washington Post reported that tourism in Mexico, the “biggest money maker after oil and remittances from abroad,” already had experienced damaging financial effects. Reports of significantly lower hotel occupancy and, in xxvii Pimentel, L. & Rota, V. (2009). Peso Tumble, Swine Flu May Prompt Mexico to Tap IMF.

Retrieved October 18, 2010, from http://www.marketwatch.com/story/swine-flu-hits-financial-

markets

xxviii Economic impact of swine flu. (2009). Retrieved October 18, 2010, from

http://news.yahoo.com/s/ynews/20090428/bs_ynews/ynews_bs317

xxix Pimentel, L. & Rota, V. (2009). Peso Tumble, Swine Flu May Prompt Mexico to Tap IMF. Retrieved

October 18, 2010, from http://www.marketwatch.com/story/swine-flu-hits-financial-markets

xxx Pimentel, L. & Rota, V. (2009). Peso Tumble, Swine Flu May Prompt Mexico to Tap IMF. Retrieved

October 18, 2010, from http://www.marketwatch.com/story/swine-flu-hits-financial-markets

xxxi DeNoon, Daniel J. (2009) Mexico Swine Flu Epidemic Worries World. Retrieved October 12,

2010 from http://www.webmd.com/cold-and-flu/news/20090424/mexico-swine-flu-epidemic-

worries-world

xxxii DeNoon, Daniel J. (2009) Mexico Swine Flu Epidemic Worries World. Retrieved October 12,

2010 from http://www.webmd.com/cold-and-flu/news/20090424/mexico-swine-flu-epidemic-

worries-world

xxxiii Walker, Mark. (2009, April 24) REGION: Swine Flu cases linked to deadly outbreak in Mexico.

The North County Times-Californian. Retrieved October 12, 2010 from

http://www.nctimes.com/news/local/sdcounty/article_0297de2d-148d-5df8-b3e4-

52c890cb1d70.html

xxxiv Lange, Jason. (2009, April 29) Mexico Warns Swine flu may Deepen Recession. Reuters.

Retrieved October 12, 2010 from http://reuters.com/assets/print?aid=USN29421604

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efforts to contain the virus, temporary closings of businesses, resulted in more than “$1 billion in lost revenue since the outbreak began,” according to the estimate of business associations in Mexico.xxxvii

The following timeline illustrates main events in this case, as a prelude to our discussion of the response of the Mexico Tourism Board.

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Timeline

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2008 Mexico earned $13.3 Billion dollars in tourism

revenue Tourism employs 2 million people Accounts for 8% of the total economy

January 2009 Numbers of foreign tourists to Mexico continuously dropping

because of the declining global economy and the press reports of increasing drug violence

February 2009 The U.S. State Department issues a travel alert

of increased drug cartel violence in Mexico (referred to in Appendix B) March 18, 2009

First report of the Swine Flu virus in Mexico

April 13, 2009 H1N1 claims first victim in Mexico

April 24, 2009 Mexico President, Felipe Caldera meets with The Council for

General Hygiene to come up with following precautions for Mexican citizens:

o Disseminate education messages about the fluo Distribute masks and hand sanitizer to the publico Discourage large public gatherings

See Appendix D for more information on what happened

April 25, 2009 Margaret Chan, Director of the WHO, calls the

current situation in Mexico a “public health emergency for international concern.”

April 27, 2009 WHO raises the influenza pandemic alert level from 3 to 4April 28, 2009

“ The Department of State alerts US citizens of the health risks of travel to Mexico at this time due to an outbreak of H1N1 “swine flu.” The Centers for Disease Control and Prevention (CDC) has issued a notice recommending that American citizens avoid all nonessential travel to Mexico at this time."

April 29, 2009 WHO raises the influenza pandemic alert level from 4 to 5

(highest health alert possible)

April 30, 2009 Swine flu now deemed ‘Influenza A or H1N1’

May 1, 2009 Mexico tourism industry has been hit hard by dropping

tourism rates especially from the US. o Hotel occupancy rates dropping to 20%o Airlines slashing prices and passenger rates by 50%o Cruise ship cancelationsMay 5, 2009

Mexico Tourism Board plans to form an evaluation committee to monitor the impact of H1N1 on the tourism profit sector

May 8, 2009 Hotels being to react

o Resorts temporarily closeo Resorts move customers to other hotelso Resorts offer ‘Flu-Free Guarantees’

May 15, 2009 The US Centers for Disease Control downgrades

it’s warning against non-essential travel to Mexico

May 26, 2009 Mexico Tourism Board said they believe the tourism business

will recover by the end of the year. Prices in all travel related to Mexico has dropped significantly There is initial talk of a campaign to bring tourism rates back

up

June 18, 2009 Mexico implements campaign

The Response Campaign

With the outbreak of H1N1 taking a toll on the country from all angles, the MTB decided to temporarily freeze all current public relations activities and tactics for a four-week period and then begin to rebuild their image of tourism.xxxviii In the meantime, prior to the campaign being launched, the Secretary of Tourism, Rodolfo Eli Zondo released the following statement: “we have launched a communication strategy in order to keep the industry and tourists in the country informed on preventive measures” (See Appendix D). After the U.S. State Department and the CDC lifted their alerts on nonessential travel to Mexico, the MTB announced that it would invest $92 million in a “Vive Mexico,” tourism campaign one week later.xxxix

The campaign was launched with four main objectives: Ensure tourisms return to normal level as soon as possible Look after the Mexican families who relied on tourism Stimulate employment Seize all opportunities for recovery and progress

According to a statement by President Felipe Calderon, under the advisement of the MTB, the campaign drew together, “the arts, business, sports and cultural sectors, as well as distinguished high profile individuals to promote Mexico as a popular holiday destination, full of life and with unequal tourism offering.”xl

The campaign focused on 12 markets in the U.S. and six in Canada and featured exclusive prices and striking offers to motivate growth in the tourism market.xli & xlii It included a three-phase multimedia promotion featuring the “Believe It” series that addressed the Swine Flu and applauded Mexico’s quick response to the crisis. The second phase, titled, “Welcome Back,” was intended to remind tourists of the beauties and great travel opportunities that Mexico offers. The final phase, “ Mexico, It’s Time to Go,” attracted travelers with incredible package deals for travel that were too cheap to pass up.36

The CEO of the MTB, Oscar Fitch, said that this campaign “proved yet again that we (The Mexico Tourism Board) are resilient to crisis.” In addition to the campaign, AeroMexico partnered with the MTB through a “collaborative marketing initiative” to promote travel to the U.S. from countries in North America, including the U.S. and Canada.xliii

In order to garner attention for the campaign, a new website, www.ofertasvivemexico.com, was created to showcase new travel deals available at Mexican resorts while simultaneously promoting the Vive Campaign. Other tactics used included celebrity endorsement by athletes, actors and other public figures. These tactics helped to

18

increase the publicity of the campaign by word of mouth, advertisement appearances and testimonials. President Felipe Calderon of Mexico supported the campaign by saying:

“We must tell everyone that we are a strong country, with unity and a unique identify and despite the trials we have undergone, particularly recently, Mexico is united and pulling through.”xliv

As of October 2010, the MTB announced that “in the first eight months of 2010, 4.33 million American travelers arrived in Mexico, a 15.7 percent increase in respect to the same period in 2009 and a 1.9 percent increase over 2008.”xlv With time and the effort of the MTB to improve Mexico’s reputation as an attractive tourist destination, tourists have started to disassociate the past health crisis with the overall view of Mexico. Mexico is still experiencing the repercussions of lower tourist rates in the face of the recent drug wars.

In the face of these crises, the Mexico Tourism Board has not stopped its efforts to win back tourists. The MTB teamed up with Travelocity to create an online “Travelocity/Mexico Hide and Seek” Facebook contest, giving their fans a chance to win one of eight prize vacations to Mexico (See Appendix F). The sweepstakes began November 1, 2010 and continued through November 17, 2010.

Wrap Up Needed!!!

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Appendices

Appendix A

Press Release from Karisma Hotels & Resorts published on May 17, 2009 by Jennifer Myers of Formula PR

Center for Disease Control removes its original warning recommending against nonessential travel to Mexico.

CDC has been monitoring the ongoing outbreak of novel H1N1 flu in Mexico and, with the assistance of the Mexican authorities, has obtained a more complete picture of the outbreak.

We are encouraged by the Center for Disease Control and Prevention (CDC)’s May 15th decision to remove its original warning recommending against nonessential travel to Mexico.  

According to the official statement, “At this time, CDC has removed its recommendation that U.S. travelers avoid travel to Mexico.  CDC has been monitoring the ongoing outbreak of novel H1N1 flu in Mexico and, with the assistance of the Mexican authorities, has obtained a more complete picture of the outbreak.”

Beyond our contentment owing to further confirmation of the wellbeing and health of our guests and employees, we are very pleased to see the CDC consider the actual situation.In reality, H1N1 has touched only .0018 percent of Mexico’s population, equating to one out of every 54,012 people.  Even in the U.S. where 36,000 Americans fall victim to the common flu each year, H1N1 pales in comparison, taking three lives and infecting only .0008 percent of the population or one out of every 118,158 people. 

Despite these telling facts, rampant media reports have inflated fears about H1N1 over the past few weeks, devastating tourism in Mexico.  In Cancun and Riviera Maya alone, one million local residents depend on tourism to survive, represented by more than 300,000 family providers employed by the hotels and other industry sectors. 

As we move forward, we ask you to consider the CDC’s current guidance and the true climate in Mexico, where residents are suffering in the wake of H1N1. 

El Dorado Spa Resorts & Hotels and Azul Hotels by Karisma are operating normally, and we invite guests to continue with plans to vacation here or to book future trips to experience our warm weather,

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stunning beaches, rich culture, relaxing environment and welcoming communities. 

El Dorado Spa Resorts & Hotels and Azul Hotels are recipients of the Cristal award by Check Safety First, acknowledging the properties as abiding by the highest health and safety standards.  Despite the lifted ban, we are still employing extra measures to ensure the wellbeing of our guests and employees, including using Iodum to disinfect glasses for everyday housekeeping service and Chlorine on any surface that could be touched including faucets, toilet and seats, and strategically placing antibacterial gel throughout the properties.

Offering guests the ultimate assurance, we have also implemented a “Flu-Free Guarantee,” where any guest that contracts H1N1 at our properties will receive their next three vacations free.  For stays booked between May 8 and June 30, 2009 for travel taking place between now and October 31st, 2009, the ‘Flu-Free Guarantee’ signifies our certainty that Mexico is a safe and healthy destination.

Please direct any media inquiries regarding this matter to Jennifer Myres at 619-234-0345 or myres@formulapr.com.

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Appendix B

Press release from the U.S. Embassy in Mexico

PRESS RELEASES 09State Department Issues Updated Travel AlertMexico City, February 20, 2009 - While millions of U.S. citizens safely visit Mexico each year, drug cartel-related violence in the country has increased recently. To reflect this, the State Department Travel Alert for Mexico has been updated with more specific information on concerns in the border area. It is imperative that travelers understand how best to avoid dangerous situations and whom to contact if one becomes a crime victim. Our aim is to provide U.S. travelers with information to help them make informed plans.

The Travel Alert for Mexico issued today is updated to reflect evolving conditions in Mexico; in particular, increasing levels of violence along the U.S.-Mexico border. These conditions are widely known and reported on in Mexico, as well as in the U.S. border region, but many tourists and business people are less aware. U.S. citizens are urged to be alert to safety and security concerns, especially in the border region, where some recent confrontations between Mexican authorities and drug cartels have seen the cartels employ automatic weapons and grenades. Homicide, petty theft, and carjackings have all increased over the last year. We urge travelers to use common sense precautions, such as visiting only legitimate business and tourist areas during daylight hours, and avoiding areas where crime is likely to occur. To read this updated Travel Alert, see: http://travel.state.gov/travel/cis_pa_tw/pa/pa_3028.html.

The State Department publishes three kinds of travel information: country-specific information, travel alerts, and travel warnings. Country-specific information is available for every country in the world and includes such data as the location of the U.S. embassy and/or consulate(s), immigration practices, health conditions, and crime and security information. Travel alerts disseminate information about short-term or changing conditions within a particular country that pose imminent risks to the security of U.S. citizens. They are generally updated or revised every six months. Travel warnings describe long-term, protracted conditions that make a country dangerous or unstable. For more information, see http://travel.state.gov.

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Appendix C

Informational release put out by the Mexico Tourism Board including the problem and what Mexico is doing in response to it

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Appendix D

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Appendix E

Graph showing the Mexican Peso vs. the U.S. Dollar and the changes over the past year. Notice the dramatic decline between January and May of 2009, during which time the H1N1 virus broke out.

Source: Yahoo FinanceAs a result of the H1N1 outbreak,the Mexican peso plunged

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Appendix F

November 01, 2010 09:12 PM Eastern TimeMexico Tourism Board and Travelocity to Give Away Eight Vacation Prizes to Popular Mexico Tourism Destinations

MIAMI--(BUSINESS WIRE)--The Mexico Tourism Board (MTB) and Travelocity have teamed up to offer their Facebook fans a chance to win one of eight Mexico vacation prizes that will be given away through “Travelocity/Mexico Hide & Seek,” an online Facebook sweepstakes.xxxv McNeil Jr. Donald G. (2009, April 27) The U.S. Declares Public Health Emergency Over Swine

Flu. The New York Times. Retrieved October 23, 2010 from

http://www.nytimes.com/2009/04/27/world/27flu.html

xxxvi From Carnival To Surgical Masks — Swine Flu’s Affect on Mexican Tourism (2009, April 28)

Retrieved October 22, 2010 from http://www.hotelmanagement-

network.com/features/feature54241

xxxvii Booth, William & Partlow, Joshua. (2009, April 30) Swine Flu Devastates Mexico’s Tourism

Industry. The Washington Post. October 18, 2010 from

http://www.washingtonpost.com/wp-dyn/content/article/2009/04/29/AR2009042904650_pf.html

xxxviii Markowicz, C. (2009, May 8). Mexico Plans Drive to Lure Back Tourists. PR Week. Retrieved

October 25, 2010, from LexisNexis.

xxxix Sottili, C., Vogel, S., Talcott, C., & Sachs, A. (2009, May 31). Coming and Going. The

Washington Post, p. F02. Retrieved October 25, 2010, from LexisNexis.

xl Vive Mexico - Mexico's New Tourism Campaign (2009, May 29). In Visit Mexico. Retrieved

October 25, 2010, from

http://www.visitmexico.com/work/sites/presseuropa/resources/PDFContent/

xli Stark, C. (2009, June 24). Mexico begins marketing efforts to restore $13B tourism industry. In

StarkInsider. Retrieved October 23, 2010, from http://www.starkinsider.com/2009/06/mexico-

begins-marketing-efforts-restore-13b-tourism-industry.html

xlii PRESIDENT FELIPE CALDERON ANNOUNCES PROMOTIONAL CAMPAIGN “VIVE

MEXICO” (2009, June 3). In Facebook. Retrieved October 25, 2010, from

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The contest, taking place between Nov. 1, 2010 and Nov. 17, 2010, will follow the Travelocity Roaming Gnome® as he hides in seven popular Mexico destinations. To participate, contestants must “like” the Mexico Tourism Board’s Facebook page at www.facebook.com/wevisitmexico and the Travelocity Facebook page at http://www.facebook.com/travelocity .

“With nearly eight million visitors from the U.S. reaching Mexico by air in 2009 and many of them choosing to use Travelocity to book their trips, the Mexico Tourism Board is pleased to be working with Travelocity to offer travelers a chance to win one of these fantastic vacation opportunities,” said Steve Austin, Chief Marketing Officer of the Mexico Tourism Board.

“Mexico is one of the most popular destinations with our customers, so we are extremely excited about this contest,” said Noreen Henry, Senior Vice President Global Partner Services, Travelocity. “We have a strong relationship with the Mexico Tourism Board and this contest is definitely a great way to use social media to showcase the unique aspects of the destination.”

http://www.facebook.com/note.php?note_id=86990383188

xliii Airline Industry Information (2009, May 20). Retrieved October 24, 2010, from LexisNexis.

xliv Miranda, L. (2009, June). VIVE MEXICO a public relations campaign to promote travel to

Mexico. In Boomers Abroad. Retrieved October 24, 2010, from

http://boomersabroad.com/blogs/vive-mexico-a-public-relations-campaign-to-promote-travel-to-

mexico.html

(2010, April 14). Tourism Industry yet to Recover from H1N1 Impact; Drug Related Violence, Slump

in U.S. Economy Worsen Situation. SourceMex Economic News & Analysis on Mexico.

Retrieved November 16, 2010, from

http://goliath.ecnext.com/coms2/gi_0199-12579155/TOURISM-INDUSTRY-YET-TO-

RECOVER.html

xlv Catalan, Veronica. Mexico Sees its Most Impressive Numbers Yet with a 6 Percent Increase in International Air Travelers in 2010, Compared to 2008. (2010). Retrieved November 16, 2010, from http://www.visitmexico.com/wb/visitmexicopress2010/august_tourism_stats

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Every two days, in an application appearing on both Facebook pages, the Roaming Gnome will post a photo of himself in a Mexico location, along with a clue as to his whereabouts. Fans will have 48 hours to guess where the Roaming Gnome is hiding before his location is revealed at 9:00 a.m. PT two days later. Any entrant who guessed the Roaming Gnome’s location correctly will be entered into a drawing for a chance to win a three-night premier hotel stay in the revealed location and winners will be notified immediately by e-mail.

At the end of the contest, all participants --- regardless of whether or not they correctly guessed any locations --- will be entered into a drawing to win the grand prize: two roundtrip business class tickets to Cabo San Lucas, Mexico on Aeromexico, from any of their United States or Canadian gateway cities and five-night accommodations for two at the all-inclusive Melia Cabo Real in Los Cabos, Mexico.

Mexico is one of the world’s leading tourist destinations ranking tenth worldwide in international tourist arrivals and the most popular international tourism for Americans.

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Works Cited

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