Apple “Both the distribution and the resort side of our businesss are very important,” said Alex Zozaya in an interview with Recommend. “Only 20 percent of our passengers end up in our hotels.”
Impressive, because AMResorts is big, and it’s getting even bigger. “In Jamaica we will open two Sunscape hotels in December next to Secrets and then a Breathless; and to attract wellness- and environment-oriented visitors who are not currently going to Jamaica, a Zoetry,” said Zozaya.
In the Dominican Republic, where AMResorts already has seven hotels, it will add two Sunscape resorts in 2016. “The new Secrets in Cap Cana will be the flagship, and we’re going to open a Now, too, so we’ll go from having sevent to 11 hotels in the D.R., which will make us the largest hotel company in the Dominican Republic,” he said. And then there’s Mexico. By the end of 2018 AMResorts will have 56 resorts in 25 destinations, reaching the 20,000-room milestone.
In keeping with that expansion, Apple Leisure Group companies will offer more charter flights. Moreover, the U.S. Department of Homeland Security’s approval of Punta Cana for pre-clearance (starting summer of 2016) will make it possible to fly there from U.S. airports that don’t have Customs facilities. “We’re considering adding flights to nine airports,” said Zozaya, “and by April we’ll announce them.”
But what about Cuba, that most talked-about Caribbean destination these days? “On the hotel side, we would love to have our brands there,” admitted Zozaya. “Ideally, they would open Cuba up so the people-to-people category would be gone completely.” However, when you consider the restrictions that still exist and the infrastructure that does not exist, this will not happen any time soon, so, he said, “In the short term, we will double or triple our people-to-people offerings.” (Recommend reported on Apple Vacations’ unique packages here.)
Beyond the fact that more U.S.-based travelers are visiting Cuba, American travelers are changing in other ways, too. “They want more value for their money, not necessarily a lower price,” Zozaya notes. “They want richer experiences—entertainment, learning, and more than just a beautiful beach or a lot of luxury. And this is not just true of millennials, but older people, too.”
The All-Inclusive Advantage
He’s not surprised, then, that “the all-inclusive category of resort is growing the fastest—seven or eight to one”—because, he said, that is consistent with both the demand for value and for richer experiences. “All-inclusive hoteliers promote going out and exploring. We even have free shuttles in some destinations,” he said, adding, “The more you do in a destination, the longer the stay. The average length of stay in an all-inclusive is 30 percent longer” than in traditional a la carte resorts.
“The United States is in diapers when it comes to the percentage of people who travel outside the country, but that percentage is growing,” said Zozaya, noting that nine years ago, it was just 18 percent of Americans. “Forty percent of passengers flying our charters are first-timers. They come back excited, and that becomes a snowball with huge potential.” He added, “That’s why I’m not concerned with competition from Cuba. People are not going to stop traveling to the Dominican Republic or Jamaica. Cuba will help the whole region to grow.”
Zozaya acknowledged that currency weakness makes it more expensive for Canadians to travel to the Caribbean at present. However, he pointed out, “it’s more expensive for Canadians to visit Europe, too.” They’ll continue visiting the Caribbean, albeit “less to St. Barths or the Turks and Caicos, and more to Cuba and to less expensive hotels in other destinations.”
The bottom line? Zozaya is confident that “the high demand for Caribbean vacations is here to stay.”