U.S. Tour Operators Rethink Future of People-to-People Tours in Cuba

U.S. Tour Operators Rethink Future of People-to-People Tours in Cuba
Dan Peltier, Skift - Apr 26, 2016 6:45 am
@djpeltier

The tour companies that have been guiding U.S. tourists through Cuba up
to now will eventually evolve or go away, but right now when restaurants
are full and beds are, too, they may be more valuable than ever.
— Dan Peltier
Individual U.S. travelers can go to Cuba, though many U.S.-based tour
operators — even those helping organize individual travel — say going
solo spells disaster.

This milestone, announced last month, allows U.S. travelers to forgo
people-to-people group tours, those approved by the U.S. government that
meet restrictions for American travel to Cuba.

President Obama began relaxing rules for to travel in Cuba in 2011 and
momentum has been building since then to open up individual tourism for
Americans. Under the looser restrictions, people-to-people activities
such as seminars and cultural meetings with local entrepreneurs are
still required. And while U.S. travelers don't legally need a tour guide
by their sides, individual travel in Cuba creates a catch-22 for
Americans, at least until all restrictions are lifted. Many of the
people-to-people activities are exclusively offered to tour operators
who've built relationships and trust with Cuban businesses and cultural
organizations. Without a guide many U.S. travelers likely wouldn't find
these people or get meetings with them, making it more difficult to
justify their trips to the U.S. state department.

"A lot of positive things have come out of the mandatory cultural
restrictions," said David Lee, owner of Cultural Cuba, which leads
groups of fewer than 12 people from the U.S. to Cuba. "I've done several
'guys trips' and these trips have contained other things that no other
guys trip would have done. Usually with guys trips, their main concern
is trying Cuban cigars and rum. But, most of my clients end up saying
these people-to-people activities are the most memorable things they did
in Cuba."

"It's hard to get a bunch of guys to sit in a room for an hour and
listen to a lecture during their vacation. But one time we met with a
key renovator who's renovating Old Havana, this guy is fascinating and
it changed the whole idea of what my clients were thinking this would
be. They were totally engaged the entire time and loved it. That's one
of the concerns I have, that these kinds of experiences will disappear."

A video below this story shows a Havana-based dance company that Lee
takes his tours to see. Lee has worked with the company for several
years and also helped organize their first trip to perform in the U.S.

Challenges With Going as Individuals

In reality, some U.S. tour operators in Cuba provide little reassurance
to clients about their trips. Most Cuban hotel reservations are still
made through the Cuban government, for example, since the government
owns most hotels. Bureaucratic processes in both Havana and Washington,
D.C. make trip-planning particularly meticulous for tour operators, let
alone individual travelers.

Wendy Perrin, founder of WendyPerrin.com, is testing U.S. tour operators
in Cuba to find ones she'll recommend to clients. Perrin's found that,
"so many people are frustrated even working with tour operators in Cuba
because they can't get answers."

"A tour operator isn't necessarily the answer to all your problems.
There are a lot of travelers who will start the ball rolling with a tour
operator but then will never get any answers. They'll book their travel
but then never get any documentation. It's like this big abyss of
information, and then maybe a few days before you're supposed to leave
you'll finally hear back from the tour operator with documents and
confirmation. And on top of that, travelers may end up being charged a
much larger amount than they ever thought they'd have to pay."

Lee has received mostly positive feedback from Perrin's clients. He sees
individual travel as an opportunity rather than a threat to his tours
business and has had several requests for custom or private tours, for
example.

"Cuba isn't really ready yet to be an unguided destination," Lee says.
"Even if you could just completely go without restrictions, you're not
going to get as much out of going to Cuba right now without a good Cuban
tour guide and that goes for Europeans and Canadians, etc, as well. The
renovated section of Old Havana is quite small, only about 12 city
blocks. It used to be that summer months were the off-season, because
summer is hot in Cuba. Now what we're finding is that there is almost no
low season anymore. Even hurricane and rainy season during August to
October, most of our tours are sold out for months in advance. Before
you could plan more last-minute during those months"

Meals are challenging for individual and group bookings alike, even with
restaurants accustomed to serving larger groups.

"For the most part these places are small and have fewer than 10
tables," said Edward Piegza of Classic Journeys, which leads U.S.
travelers to Cuba and other destinations. "Big groups just don't fit and
you have to make reservations months in advance. I remember sitting down
with a group in one of these restaurants and the chef comes to the table
to tell me that they have 10 entrees available that night. I said,
'that's great.' Then he told me, 'no, I mean we only have 10 plates of
food available,' and there were more than 10 people in my group."

Lee said many Cuban restaurants are at a turning point, "With the
restaurants, there is a revolution right now. Restaurants all used to be
state-owned but now you have many that are privately owned by local
entrepreneurs. Some are great and some are untested. No one is coming
from Miami to help Cuban chefs build out these restaurants."

Cuba has some 108,000 hotel rooms in the pipeline through 2030,
announced by Cuba's ministry of tourism this week, but it's not clear
how many rooms Havana will add.

"Building 108,000 hotel rooms in 14 years is obviously an ambitious
goal," said Piegza. "With 10,900 added in the last five years in Cuba,
that works out to 2,180 per year. Adding 108,000 in 14 years would equal
7,714 per year, so about triple the current pace. Of course, with Cuba
tourism up 75 percent in the last year and infrastructure growth
significantly lower than that, a commitment to adding needed
infrastructure is welcome."

"Manuel Marrero, Cuba's minister of tourism, notes that these rooms are
going to be focused on areas with marinas and golf courses. So that
sounds a lot like the types of all-inclusive properties along Varadero
Beach and Cayo Santa Maria that typically cater to Europeans. Since the
trade embargo is still in effect for the U.S., beach and golf vacations
are still a no-no in Cuba."

Creating Itineraries for Individuals

Group tour interest hasn't subsided. According to data from digital
marketing firm iQuanti, U.S. travelers made about 6.2 million Google
searches for search terms related to group tours, travel agencies and
packaged deals in Cuba between March 2015 and March 2016. In comparison,
there were a little more than 741,000 Google searches during the same
window for search terms related to researching individual travel, such
as booking flights, hotels and activities.

Some tour operators, like Insight Cuba, are already adjusting their
offerings to create tour products designed for individual travel. Tom
Popper, president of Insight Cuba, said he's been "waiting for quite
some time" for individual travel to be approved and that he has many
clients looking to go individually. But most of his U.S. clients are
still confused with what's considered legal travel to Cuba.

"We're going to keep escorted tours exactly as is because they've been
so successful for us and still remain in high demand," said Popper. "But
we're also working with Cuban travel agencies and authorities to develop
a version of our product that works for the individual traveler. We're
hoping to have those released in the coming weeks."

"Last month the Obama Administration announced that any American tour
company can work with any Cuban tour agency. Before we could only work
with three, so that changes the landscape," Popper said. "The real
challenge that remains is being able to guarantee guests flights and
hotel rooms. Cuba won't just authorize something just because the U.S.
says it's ok to do now. Even some of the largest hotel chains in Cuba
are now starting to allow direct bookings on their websites. But because
of banking regulations, a lot of that is done through third party sites
so there are challenges with direct bookings to make sure that a booking
is really a booking."

The 2016 U.S. Presidential Election

Unlike European and other tour operators in Cuba, U.S. tour operators'
future in Cuba is contingent upon the U.S. Congress lifting the five
decade-plus trade embargo. The tour operators Skift spoke to feel the
snowball effect makes stopping the current progress of U.S. hotels,
airlines, and cruises entering Cuba, nearly impossible to reverse.

"This is a movement that won't be turned back," said Piegza. "It might
go faster or it might go slower but we already have a direction in which
it is going. My gut is that we've gone so far now that regardless of
whoever wins on whichever side of the aisle, we'll keep moving forward."

More opening is inevitable, Popper said, regardless of which party
controls the White House next January, "The pendulum has really swung in
the direction that we're finally looking at a long-term solution to
travel to Cuba. In all the years past, it really hinged on presidential
politics. Everyone assumed that whenever a Republican got into office,
travel would be carved out and we'd take a bunch of steps backwards.
Regardless of who will be in the White House next year, there's so much
momentum going towards travel right now and things are really looking
bright. Although while things are moving quickly on the U.S. side,
things will move slowly on Cuba's end."

Source: U.S. Tour Operators Rethink Future of People-to-People Tours in
Cuba – Skift -
https://skift.com/2016/04/26/u-s-tour-operators-rethink-future-of-people-to-people-tours-in-cuba/