Tourism Holdings: Interview

-Jenny Ruth

Tuesday 28th November 2006

Expect to see some major changes in at least the look of the Tourism Holdings businesses under its new chief executive Trevor Hall.

The company currently owns quite a number of well known brands, including the Maui and Britz campervans, its CI Munro caravan manufacturing business and the Waitomo and Ruakuri caves. It also owns the Red Boats at Milford Sound, the Kelly Tarlton aquarium, the Fullers's business in the Bay of Islands and its coach brands Kiwi Experience, Great Sights and Johnston's.

But there's nothing linking them together or to the holding company.

Hall is planning to introduce a new "hero" brand which will link the brands together and allow better cross-marketing of the company's services.

As part of that, all the "heritage values" of the existing brands will be examined and most of them are in need of refreshing anyway, he says.

How it's likely to work is that the new brand, XYZ, which could even be one of the existing brands, will be applied across the company so Maui will become XYZ Maui and it will be XYZ Kelly Tarlton and XYZ Kiwi Experience, although Hall hastens to add that he's keeping an open mind as to the possibilities.

"What we've really got to do is focus a lot more around the customer. We just need something better than Tourism Holdings to link the company through, not just for customers but for cross-marketing and for our own staff," Hall says.

The first step in the process is to find the right branding agency, something the company is currently working on, he says.

A logical extension of that process would be that the company's name could change to whatever the "hero" brand is.

Hall already has successful marketing credentials behind him. When he was chief executive of the New Zealand Lotteries Commission since February 2003, the introduction of the Big Wednesday draw helped turn around a record of falling sales.

Hall is also moving the company's head office functions out into the operating businesses. The head office currently consists of five people and it will soon "find a corner in one of the operating divisions and we will have IT and project management close by."

Hall's other focus is behind the scenes on improving the company's IT systems. "The historical way of looking at IT has been as a support function. I see it very much as key in the leadership team,"and a key enabler for the business, he says.

Emphasising its importance, Hall has hired Quinton Hall, no relation, who he worked with previously at the Lotteries Commission, as the company's chief information officer.

Shareholders may be forgiven for giving a little shiver when Hall talks about taking the company's experience and expertise in the motor homes business into other international markets, although the company already operates in Australia, Fiji and has a franchise operation in South Africa.

Hall says that his company is the second largest motor homes operator in the world behind Cruise America.

"We've got very good intellectual property around building motor homes, very superior IT systems and we're investing even more in them. We have offices throughout the world, in Munich, London and the USA and we've got very strong brands. Maui and Britz are very well known throughout the world," he says.

"We need to ask ourselves questions around growth possibilities, around franchising. We've got all the infrastructural requirements to grow."

The CI Munro business is one manufacturing operation with no plans to move offshore. Hall says the company is investing significantly in modernising its production lines and in computer-aided design. "We intent to keep investing in that business."

Hall certainly has a better starting point than his predecessor Dennis Pickup. When he took over, the company was a mess of more than 60 trading companies and joint ventures with a history of poor reporting and a habit of regularly getting into financial strife.

These days the company has a healthy balance sheet with $177.5 million in equity supporting total assets of $294.5 million, although its return on assets is still only about 8%, well below the company's 14% target.

"Tourism is a very tough market. It has very low barriers to entry," Hall says. "That doesn't mean you can't be very good and very successful at it."

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