Think Tank Wine Tourism

THE FUTURE OF TOURISM

In the past years, Portugal has strengthened its position as the world's best destination when it comes to Tourism. The Tourism sector represented more than 14% of the GDP in 2019, placing Portugal in the top 5 European countries where Tourism contributes more to the GPD. With the Immense growth of the sector

In recent years, with the highest values on record, Tourism operators have

Increased, there is more demand, More supply, more investment, and More tourists.

Even though the Tourism

The sector has grown quite rapidly, its territorial distribution is still felt in the rural areas of Portugal, where rural Tourism and nature experiences are now taking a step towards new developing opportunities.

However, the digital transformation of the Tourism sector is crucial, and creating a qualified offer for the new tourist profile will be the key to sustainable growth. While the pandemic situation battered an array of business sectors, tourism sector activity took the heaviest hit. Tourism activities experienced an upturn, however international tourist arrivals were still below the pre-pandemic year of 2019. The rebuilding of the tourism for the future is crucial, and the challenge remains: how can we bring tourism back better? More and more initiatives have been organized with a national effort to bring new and innovative approaches to the traditional Tourism we used to know.

From identifying challenges and creating startups to help the startups to grow, many contributions have been made in order to keep the sector growing disruptively but sustainably. The result of this

effort is the entrepreneurial community we can now find in Portugal, united to face the adversities and conquer new markets and business models. With the increase of tourism startups come with the necessity to create a match between the needs of the market and the startups’ products and services. Hence, this necessity urges us to create platforms and build bridges that can identify the needs of the market, before and after the pandemic, and make sure the entrepreneurial ecosystem is aligned with the real pains of their customers.

The wine tourism sector specifically, as a tourism niche, is a developing sector with great potential for growth and development due to factors endogenous to our country and culture, being the central reason for the study of this report.

WHAT TO EXPECT

Why are we here?

What are the challenges?

W H Y A R E

WHY ARE WE HERE?

NEST – Tourism Innovation Center of Portugal joined forces with Fábrica de Startups to create a diagnostic cycle of Think Tanks aiming to study the Portuguese Tourism market and identify main challenges, needs, and opportunities within the Tourism innovation processes.

Six main vertical areas of the Tourism sector were identified in order to conduct the study, namely: Gastronomy & Restaurants, Hospitality, Tourism Activities, Points of Interest, Wine Tourism and Digital Nomads.

S U R V E Y

Each cycle was divided into 3 steps, firstly a survey, secondly a Think Tank, and thirdly a report.

On the first step, a survey was conducted and distributed through a selected group of specialists who are decision-makers, responsible for defining strategies, and ensuring operational processes within each of the vertical areas. Throughout the survey, we have collected information regarding the main challenges in the sector and the future opportunities regarding innovation, digitalization and sustainability.

For the Think Tank, we have invited a selected group of people, including decision-makers and operational workforce with proven experience in the sector, to participate in a dynamic workshop. The Think Tank was conducted to identify specific internal and external struggles in the sector in order to generate a set of potential opportunities for new products, services and businesses.

This report intends to portrait the results of the fifth cycle of innovation regarding identifying new opportunities for the future of the Tourism sector, mainly, the Wine Tourism segment.

VERTICAL AREAS

GASTRONOMY AND RESTAURANTS

Considered as a cultural patrimony, gastronomy is proven to be one of the main factors when choosing a touristic destination.

HOSPITALITY

Breaking records in the occupancy rate in 2019, the hospitality sector has grown rapidly, at the point of attracting international investment in Portugal.

How is the sector adjusting to the online channels?

Are restaurants taking advantage of the new technologies?

How to engage with their communities?

TOURISM ACTIVITIES

The success factor is to differentiate your solution and correctly targeting it.

What is the future customer journey?

How to become more sustainable?

How to add value and create an unforgettable and repeatable experience?

What has changed in the hospitality sector?

How to leverage new technology?

What are the new trends and customer behaviors?

POINTS OF INTEREST

The patrimony of Portugal is equally spread through its territory, whether we are talking about museums, palaces or nature.

How to analyze the fluxes of tourists?

How to guarantee an easy and sustainable mobility of tourists?

How to leverage tech solutions?

VERTICAL AREAS

WINE TOURISM

As an emergent sector and part of the cultural patrimony Wine Tourism is proven to be one relevant area when choosing a touristic destination.

DIGITAL NOMADS

Portugal has become one of the most preferred destinations for this segment. Offering everything that nomads seek while working in a foreign country.

How to diversify customers?

How to guarantee a personalized service?

How to create successful campaigns?

How to train the workforce?

Can we create a national incentive plan?

How can insurance companies develop new products?

How to create more engagement on the local communities?

How can we create new digital products and services?

WINE TOURISM

Wines in general are a highly recognized cultural heritage of Portugal with a lot of well -known brands worldwide. Portugal is one of the world’s largest wine producers and exporters and it has its own national brand, Wines of Portugal. It is not surprising that Portugal is elected as one of the destinations of choice for wine tourism activities by tourists from all over the world.

Wine tourism helps to create unforgettable experiences that involve tourists with the local culture, landscape, leisure activities, gastronomy, and wine. Memorable experiences drive tourists’ destination choices and their attitudes at the destination. Therefore, it’s important to look closer at how the sector has been evolving and what are the main struggles to overcome. The customer is becoming more demanding and the sector needs to innovate and improve quality standards in order to assure the future of the businesses in the long term.

Technology is important to help the sector rapidly adapt to new behaviors and trends, without forgetting the tourist is looking for a unique, unforgettable, and personalized experience.

How to create innovative concepts applied to the wine sector to diversify customer segments?

How to improve customer experience to became a worldwide reference in wine tourism sector?

How to increase workforce productivity to guarantee an excellent service to the consumer?

W H A T A R E T H E

______CHALLENGES

THE SURVEY

The survey was sent and answered by a group of 51 particular people to make a diagnostic regarding the current situation of the Wine Tourism sector. Among the selected group of people, there were decisionmakers in the Wine Tourism sector, vineyard owners, wine specialists and winemakers. The diversity of the groups was crucial to identify the key challenges across the value chain of the sector.

Most of our invited experts were Portuguese (90%) and 37% were working in Lisbon Region. 47% of our participants on the event are owners of some wine business / brand and 31% works in some wine brand or producer as managers.

The goal of this survey was to have a qualitative approach to the challenges and opportunities of the sector while shaping the approach during the Think Tank.

The following pages represent the main results of the survey, by pointing out the main challenges, problems, and opportunities.

Over 50% of the participants on the Think Tank are from Lisbon, Oporto and North of Portugal

The majority of the respondents were Portuguese

PROFILE

Most of our respondents work on a small-medium sized company

Almost half of the sample are owners of some wine business / brand or wine tourism place

PROFILE

Most of our experts are service providers related to Wine Tourism sector and they classified their offer specially by doing wine tasting experiences and guided tours of the facilities and the average price for most of the services is < 100€

Thematic meals

Guided tours of the facilities

Guided tours to vineyards

Others

26% of the respondents indicated that they didn’t belong to any specific demarcated region. The remaining sample mentioned Lisbon (16%), Alentejo (16%) and the Douro region (14%).

CUSTOMER PROFILE

Almost 60% of the international customers come specially from Brazil, USA, France and Spain.

Most of them are individuals, couples (with no children) or organized group tours

Groups

MAIN CHALLENGES

Participants were asked to pick 3 specific challenges from a giving list. The numbers presented in the chart represent the percentage of participants which picked a specific challenge. This representation method was adopted throughout similar questions of the survey analyzed in the following pages.

From a list of specific challenges, these are the most representative challenges of the sector

Diversify the offer of services

Improve customer experience

Increase strategies for valuing the region

Diversify target audience

Increase digital marketing strategies

Ensure maintenance and improvemental improvement

Develop environmental sustainability

Ensure the transition to digital

Define strategy to compete with international destinations with more tradition in wine tourism

Improve and automate operations

Improve communication with customers

Enhance qualified resources management

Other

NEW BEHAVIOURS

Most of the participants consider that the main concerns of the wine tourism customer are the quality of service (26%), the offer diversification (15%) and sustainability (14%) and after the pandemic the big majority believes the sector will need between 1 to 2 years to overcome pandemic negative consequences on the wine tourism industry

BUSINESS DIGITALIZATION

Our experts perceived the digital component of their businesses in a medium stage of maturity, tending to be considered as “more mature”

NOT MATURE AT ALL

EXTREMELY MATURE

BUSINESS DIGITALIZATION

The majority (71%) have made some investments related to technology on the past 2 years mainly related to digital marketing and social media (50%) and financial software (12%)

Microsoft Office Financial software Planning Programs RGPD and Database

Creation and Management of Apps

Data Analysis Tools

Digital Marketing and Social Media Other

BUSINESS DIGITALIZATION

The areas were there’s still no digitalization improvement or investment are mainly the internal operations management (19%), booking systems (15%), sales channel (15%) and also on the delivery channel (14%)

The most urgent areas to invest were marketing (27%), booking systems (16%) and sales channel (16%)

RESOURCES & TECHNOLOGY

The most important technologies to adopt urgently selected: digital marketing and social networks (19%), CRM solutions (12%), data analysis tools (11%) and website creation and management (10%)

They evaluate the stage of technical skills of the staff developed and extremely developed (74%)

NOT DEVELOPED AT ALL

OPPORTUNITIES

The most relevant opportunities for the sector were considered: sustainability (25%) and increase the quality of the product / service provided (24%)

STRATEGIES & SOLUTIONS

The most considered strategy to innovate on circular and sharing economy was the positive impact on local communities and cultural aspects (e.g. employment generation)

51%

17%

Sharing and agile transfer of resources

Neutral or positive impact on the environment

Search for suppliers and local resources

Positive impact on local communities and cultural aspects

Other

18%

STRATEGIES & SOLUTIONS

The most considered technological solutions for the wine tourism sector were digital platforms (22%), e-commerce (19%), virtual reality (13%) and multimedia experiences (13%)

T H I N K I N G

______THE SECTOR

THINK TANK RESULTS

CONCEPT

The Think Tank was an online session with the presence of a group of experts in the field of Wine Tourism, coming together to think about the main struggles of the sector and explore future opportunities to solve them.

A group of 17 people was invited to participate in a dynamic workshop regarding the future of the sector. The workshop was conducted by Fábrica de Startups using a design thinking approach to identify challenges, find main struggles and detect possible solutions. Prior to the Think Tank, Fábrica de Startups selected the main 4 challenges the sector is facing in the moment, based on the results of the survey. These challenges represent the foundation of the exercise where each team is assigned a specific challenge. Subsequently, each team will have to choose a specific customer segment and go through the customer journey to find the key frustrations. After identifying the main pains for the customer segment, participants are invited to evaluate and select only one problem to which they will, later, find possible solutions.

During the think tank the following metrics were taking into consideration:

On the next pages, we will show you the process that each team went through and the main conclusions. The outcome is specific enough to be more than just a theorical exercise but broad enough to allow different approaches to the identified problems and opportunities.

FOUR CHALLENGES

Prior to the Think Tank and taking in consideration the results of the survey, Fábrica de Startups selected the main 4 challenges the sector is facing at the moment. These were the challenges that shaped the Think Tank focused on the Gastronomy and Restaurants sector.

DIVERSIFY CUSTOMER SEGMENTS

Attract younger generations

Diversify customers

Increase business for families

IMPROVE CUSTOMER EXPERIENCE

Ensure a safe experience

Guarantee a personalized service

Maintain a trustworthy relationship with customers

ENHANCE DIGITAL MARKETING

Create successful campaigns

Communicate with new audiences

Generate efficient campaigns on social media

INCREASE OPERATIONAL EFFICIENCY

Workforce recruitment & training

Use technology to improve productivity

DIVERSIFY CUSTOMER SEGMENTS: OPPORTUNITY #1

CHALLENGE #1

MAIN OPPORTUNITY:

COUPLES WITH NO CHILDREN (UPPER-CLASS)

RESEARCH

This is the step where customers start looking for the offers available in the market.

MAIN PROBLEM:

When couples are planning their visits they have a hard time selecting their destination due to a lack of information on a centralized location. For Wine Tourists looking for specialized destinations and producers, the information is not easy to find because it is dispersed in many different sites, usually managed by the brands.

SECONDARY PROBLEM:

Producers find it difficult to be available and manage information requests (from visitors and information aggregators).

Create a single platform (website and/or app), transversal to all Wine Tourism offers with all the information aggregated in one single place. Tourists will be able to find information about available services and experiences, location and surroundings, booking options, payment/invoices and rate / review options.

DIVERSIFY CUSTOMER SEGMENT: OPPORTUNITY #2

CHALLENGE #1

MAIN OPPORTUNITY:

FEELING THE NEED

This is the step where the segment is searching for new experiences

MAIN PROBLEM:

When targeting new segments, namely digital natives, wine tourist service providers are not using the right tools and platforms or optimizing their websites for search engines. Therefore they are not easy to find on online channels, apps, or website aggregators. There is a lack of digital marketing strategy.

SECONDARY PROBLEM:

Destinations are not combining resources and coordinating strategies for increasing promotion and awareness with other stakeholders.

There is an opportunity to attract new segments, typically with higher income, that makes all their decisions based on online platforms by creating a promotional campaign optimized for online channels. This campaign should include information regarding individual products & services focused on Digital Natives and combine information about the destination as an integrated offer.

DIGITAL NATIVES

ANTÓNIO PÉ-CURTO

Nowadays everything happens in customers hand – on a smartphone. It’s necessary to take that in consideration and create a complete digital marketplace offer with all the information about the experiences, location, costs, payment method, invoice – all in one single place without using many operators. It’s necessary the integration of the complete experience in one single place!

WINE BUSINESS INVESTIGATOR & ALLEWINE FOUNDER

IMPROVE CUSTOMER EXPERIENCE: OPPORTUNITY #1

CHALLENGE #2

MAIN OPPORTUNITY:

FEELING THE NEED

This is the step where the couple is preparing their experience and start searching information about all the options available.

MAIN PROBLEM:

The current Wine Tourism offer didn't adapt to the new visitor profile, mainly young couples with no children who have different goals and are looking for unique, personalized, and memorable experiences. At the moment the existing offer does not provide a customized customer experience.

SECONDARY PROBLEM:

Lack of an integrated offer with other players in the tourism sector.

Create and develop new products and services to achieve a unique and customized customer experience. The new portfolio should include tailor-made and innovative experiences and use technology to engage with the potential customer when still doing their research. Customization the flexibility are fundamental aspects for new tourist segments. Multimedia content and detailed information about the different experiences will highlight the quality and differentiating character of the offer.

COUPLES WITH NO CHILDREN (UPPER-CLASS)

IMPROVE CUSTOMER EXPERIENCE: OPPORTUNITY #2

CHALLENGE #2

RESEARCH

This is the step where customers start looking for the offers available in the market.

MAIN PROBLEM:

INTERNATIONAL COUPLES WITH NO CHILDREN (UPPER-CLASS)

For an international target market there is problem when promoting Portuguese Wine Tourism. Other internacional competitors have more exposure and find it easier to promote their products and services. There is a lack ok knowledge in terms of communications strategy to overcome international competitors.

MAIN OPPORTUNITY:

SECONDARY PROBLEM:

Lack of an integrated offer with other players apart from the Wine Tourism Sector.

Create a powerful and effective digital marketing campaign for international markets associating wine experiences with other tourist offers. Increase international partnerships to overcome competitors. This strategy will showcase a more diversified offer to customers (not only related to wine experiences), attract new segments for the wine experiences that usually don’t do this kind of activity, and will allow focus on battling seasonality and low season.

RITA SOARES

It is very important to create standards in customer service. For this, the training of operational teams plays a crucial role, as well as the creation of SOP's and the creation of a strong CRM are fundamental to guarantee the maximum satisfaction of our customer.

ENHANCE DIGITAL MARKETING: OPPORTUNITY #1

CHALLENGE #3

MAIN OPPORTUNITY:

RESEARCH

This is the step where customers start looking for the offers available in the market.

MAIN PROBLEM:

Communication campaigns, particularly digital marketing campaigns, are not being properly segmented. Therefore, we are not reaching out to new market segments at the time of their choices, we are not taking advantage of the potential of digital marketing.

Create a study of the new persona for Wine Tourism, their customer journey, their customer habits, pains and needs. This studie should be carried out for different markets. The new tool will be the handbook for marketers when setting up their digital marketing campaigns allowing to increase the reach of the communications and sucess of new campaigns.

SECONDARY PROBLEM:

Websites with lack of information and not responsives for mobile searches.

COUPLES WITH NO CHILDREN (UPPER-CLASS)

ENHANCE DIGITAL MARKETING: OPPORTUNITY #2

CHALLENGE #3

MAIN OPPORTUNITY:

COMING BACK

After the experience how can we make sure people will come back or recommend this experience to other people?

MAIN PROBLEM:

Lack of cross selling strategy, making it difficult to increase the ticket per client and profitability of each Wine Tourism project. Customer relationship management is not efficient and is not allowing targeted digital marketing campaigns for repeated sales.

SECONDARY PROBLEM:

Lack of complementary products and services for the customers.

To increase repeated sales and implement a cross-selling strategy it's necessary to create a Customer Relationship Management System tailor-made for the Wine Tourism Sector. This system will allow the registration of information about clients and generate the necessary information for implementing sucessfull digital marketing campaigns and generate data needed for identifying opportunities for new partnerships, and cross-selling products.

COUPLES WITH NO CHILDREN (UPPER-CLASS)

HUGO FRANCISCO

To enhance digital marketing on the segment of couples with no children’s segment from upper classes we consider the cross selling the main challenge. We believe there’s no strategy developed yet. I represents many challenges such as a great concept creation, structure and strong promotion.

PORTUGAL GREEN TRAVEL

INCREASE OPERATIONAL EFFICIENCY: OPPORTUNITY #1

CHALLENGE #4

MAIN OPPORTUNITY:

PLANNING THE ACTIVITIES:

When customers plan all the activities during the stay.

MAIN PROBLEM:

Management doesn’t have information about customers, their profile, and their expectations. In addition, they have no record of the activities carried out by the visitors. This gap is not allowing the creation of a personalized service adapted to clients' needs and preferences.

SECONDARY PROBLEM:

Lack of standards checklists and main processes.

Creation of SOP’s to create specific procedures for the operational team that describe in detail all the tasks in accordance with the industry and guarantee quality standards and parameters. Implement a Customer Relationship Management to build a solid connection with clients and more alignment with their needs and wishes.

Assure an investment in staff training for new tools and procedures.

MANAGEMENT

INCREASE OPERATIONAL EFFICIENCY: OPPORTUNITY #2

CHALLENGE #4

REVIEW AND REFER

How can we guarantee that after the experience the customer will return or recommend us to other people.

MAIN PROBLEM:

Lack of storytelling in review and feedback collection. There is little approach to the history of the cellar and wine and Very technical speech on the speech. Relationship with the customer does not contribute to the improvement of service and loyalty.

MAIN OPPORTUNITY:

Create a training program for guides, wine experts, and hosts with detailed information about the region, territory, and heritage.

EXPERIENCE’S HOST

SECONDARY PROBLEM:

Lack of customers loyalty and repeated sales.

Implement a process for collecting reviews and feedback throughout the experience, supported by a data management system.

OLGA CARDOSO

One of the pains to overcome is the isolation of wine tourism experiences. Wine tourism must be related to other type of tourism activities (non-wine related) to achieve 3 purposes:

First, to promote a more complete offer to the consumer, second to bring people from other areas of interest to the wine tourism area and, last but not the least, to fight against seasonality.

We need a more careful training in languages, tourism and wines because they are 3 areas where good wine tourism has to be efficient.

WINE N ROUTE

T H O U G H T S A N D

______OPPORTUNITIES

CONCLUSIONS

CONCLUSIONS

The survey combined with the Think Tank’s session outputs allowed us to recognize and categorize several challenges and trends the wine tourism sector is facing at the moment. During both phases, experts in the area come together to create a reflection on the main struggles that need to be solved in the short-mid term.

At the same time, partnerships are a crucial element for the growth of the sector to increase visibility with other customer segments that are not usually wine tourism customers.

Cross-selling is also a strategy to keep in mind as it increases visibility and sales, thus battling another problem in the sector: seasonality.

Our experts also decided to focus on the internal processes which indicate the need to reorganize and rethink the operations of the sector.

The training and recruitment of qualified people and the creation of processes to standardize procedures and ensure quality standards must also be taken into account.

Our specialists concluded that the wine tourism sector has an enormous potential. It’s a low digitized sector and, therefore, with high potential for growth and development – a world full of possibilities.

Clear priorities should be the improvement of available information, the use of integrated platforms, the presence on responsive aggregator websites, creation of apps that take the customer from the beginning to the end of the experience.

Knowing more information about the customer through Customer Relationship Management Systems is a strong opportunity to more easily meet their needs and desires, allowing the design of unique and exclusive tailor-made experience that create memorable memories.

Investment in field and operations teams is also a super relevant factor.

After all this, it will be possible to move forward with a robust and aggressive communication strategy to promote the industry and not only take advantage of national customers but also increasingly reach an international audience.

MAIN CHALLENGES

DIVERSIFY CUSTOMER SEGMENTS

FOCUS: how to attract different customers that never had wine tourism experiences

IMPROVE CUSTOMER EXPERIENCE

FOCUS: guarantee a memorable customer experience in order to attract other segments and create brand awareness

How to engage with premium customers?

How to communicate wine experiences?

How to aggregate all the information in one single place?

How to ensure a premium and unique experience?

How to create a memorable experiences that will make customers come back or recommend it to other people?

How to communicate effectively with differente customer segments?

App creation with all the info about wine experiences and tourism including payment methods and invoice system;

Promotional campaign about specific regions and unique offer of that destination targeted to different segments.

Create a strong digital marketing campaign to promote Portugal as strong destination for wine tourism;

Create tailormade and innovative experiences according to CRM information;

Take use of technology to engage with customers.

MAIN CHALLENGES

ENHANCE DIGITAL MARKETING

FOCUS: communicate with customers using innovative digital marketing technics

INCREASE OPERATIONAL EFFICIENCY

FOCUS: promote customer satisfaction through an efficient operational performance

How to communicate effectively to our customers?

What are customers digital habits? Which channels they prefer?

Which strategies must be implemented to impact new customers?

How to control the quality of the delivery service?

How to implement standardized patterns of service?

How to increase the quality of operational people?

Implement market research about customer behaviours in different markets; Use cross selling as a powerful tool to spread the offer to other customer segments;

Create partnerships with other brands / producers to increase brand awareness.

Investment on recruitment and training for operational staff; Create operational efficiency to promote the return and referal; Create standardized processes to guarantee quality patterns and customer satisfaction.