The private sector has set a very high level of ambition for 2016 by opening more than thirty new hotel facilities and renovating existing ones.
Tourism, as one of the most important and competitive industries in Croatia with a very strong growth potential, certainly deserves a quality review of the past period, but, more importantly, of what lies ahead for the sector in the next year or two. Croatian tourism closes the year 2015 with expectations of total revenue of around eight billion euros, which is a significant increase compared to 2014, when tourism revenue was recorded at 7.4 billion euros. A significant impact on this favorable result can certainly be found in the fact that Greece again collapsed at a crucial moment – the question of exiting the eurozone and returning to the drachma, although ultimately unrealized, unsettled the Greek tourism sector. Thus, during May and June 2015, due to mass cancellations of summer vacations, there was a significant spillover of demand to Greek competitors, including Croatia to a lesser extent. This should also be added to the terrorism in Tunisia, Egypt, Morocco, and Turkey.
‘Lifestyle’ Marketing Approach
In such conditions, 2015 was an exceptionally fruitful year for Croatian hoteliers. Alongside the standard high occupancy rates during the summer, hoteliers decided to raise prices to capture additional new demand, which ultimately manifests in the expected double-digit growth rates of hotel revenues on the Adriatic. We will also remember the year for the notable investment wave that manifested in the opening of more than 30 new hotel facilities, most of which underwent renovation and reconstruction (‘brownfield’ investment), while a few involved completely new ‘greenfield’ construction. Additionally, the long-standing search for a reputable investor for the state location Kupari has successfully concluded. The concessionaire Avenue Group will develop a luxury ‘spa&relax’ zone at this location with a total capacity of around 400 accommodation units under the Ritz Carlton brand. This project heavily utilized Croatian expertise, with market strategy and best use concept developed by Horwath HTL consultants, while the architectural firms EDSA from the USA and 3LHD from Croatia developed the physical master plan for the resort. Construction work is expected to begin in 2017, with plans for the resort to enter the market in the 2020 season.
In 2015, Croatian tourism (finally) presented a new ‘big idea’ – ‘Croatia – Full of Life’. After its world premiere in London, Croatian tourism left behind an extremely successful and well-received, yet overly long-used slogan ‘The Mediterranean as it Once Was’ and finally embraced a ‘lifestyle’ marketing approach that focuses on experience and emotion. Despite the divided public opinion, the market has so far well accepted the new slogan, and 2016 will be a true test of this solution. In the last quarter of last year, the issue of refugees and immigrants attracted special attention, to which Europe did not provide a timely and adequate response. However, since the tourist season was behind us at that moment, there was no greater damage to tourism, which does not mean that this can be expected in 2016.
We will also remember 2015 for several aggravating situations – the issue of tourist land was not resolved, which greatly hinders further serious development of tourism infrastructure. Attempts were made to resolve the issue of transforming the tourist board system into destination management organizations, however, so far unsuccessfully. Destination management is one of the basic prerequisites for a more serious competitive leap for Croatian tourist destinations, just as it functions in developed and sophisticated tourist markets of Central Europe. However, a law that would adequately define a new model of management and distribution of responsibilities to the satisfaction of the tourism sector and the tourist board system has not yet been defined in our country.
