Good afternoon and thank you for being here this afternoon.

What you have learned thus far is intended to help you understand the rationale for the way forward, the rationale for change. It's time to wake-up Bermuda. The way forward is a series of bold new steps. Steps that are intended to change the very nature of Bermuda tourism.

Are they earth shattering? Some people think so.

Are they drastic? Maybe.

They are a series of planned and “purpose driven” action steps designed to evolve, diversify and grow Bermuda Tourism.

In light of both the direct and indirect impact on the people of Bermuda, the tourism industry must be considered an important pillar of the local economy. The creation of the Ministry of Tourism & Transport some five months ago provided for a dynamic partnership whose natural synergy can now be exploited in the best interests of Bermuda.

There is no question that life would be easier if you could predict the future. I certainly agree with a quote that I read recently that said, “if we could predict the future than we'd never have to second-guess any of our decisions again”. Although we can't predict the future, we can prepare for the future by planning.

A business writer once said: “Life is defined by change. When we get up in the morning, we expect to live through a day that's different in all sorts of ways from the day before. All of us expect change. At one time or another, no doubt, each of us has said, I really need a change. But you don't often hear people say that they must change. Change makes things uncertain,” uncertainty makes us uncomfortable. Too many Bermudians want things to change but are themselves unwilling to change.

Ladies and gentleman, the world has changed. The airline industry has changed. The cruise ship industry has changed. The hotel industry has changed. Technology has changed. Our target has changed…and difficult as it may be for us to except, Bermuda tourism must now change.

The outlook for 2005 shared with you earlier is clear. We will have more flights, more gateways to support, more cruise ships calling, more hotel beds and if we get it right…more visitors. Both air and cruise; and to this end, the Ministry of Tourism and Transport will pursue a special strategy for Bermuda.

We will be operating throughout a number of markets and must consider feeder market support. This means that we can no longer address primary gateways exclusively; notably, we will support feeder markets only in those instances where there is a strong business case. An example would be Los Angeles, a feeder market for American Airlines via Miami. The airline is offering fantastic rates through Miami, under $500 to launch, why wouldn't we take advantage of that attractive pricing by reaching out to a market such as Los Angeles that has shown potential for Bermuda?

We will be marketing a fairly wide range of products and to be successful in this strategic context Bermuda will have to be differentiated in some way from the competitive offerings.

Specifically, we will sell beach & sizzle in the summer months, golf and spa in the winter months and use group & incentive travel as well as sports and event tourism to supplement arrivals throughout the course of the entire year.

We will manage air and cruise arrivals so as not to exceed our daily carrying capacity. The product offering must in some way be unique in terms of the customers' perception and we must intensify brand identity and loyalty.

Our goals are:

- To increase tourism's economic impact as it relates to on-island expenditure and public sector revenue.

- To grow the number of visitor accommodations and direct air access gateways.

- To increase the number of Bermudians employed in the hospitality sector and;

- To develop and diversify the tourism product

We have, in collaboration with the industry partners via BAT, established four business objectives for Bermuda tourism and added a fifth objective specific to industry management of our own.

One: we will increase air arrivals to 400,000 over the next 3 years.

Two: we will achieve our daily carrying capacity through effective management of cruise arrivals.

Three: we will increase key visitor experience “complete satisfaction” indicators by 10%.

Four: we will increase per person visitor spending by 7% and;

Five: we will increase Tourism Department efficiency, effectiveness and productivity.

To achieve these objectives we have determined the need to employ several strategies and tactics.

That is, to increase air arrivals to 400,000 over the next 3 years we will:

Remove the high cost of airfare as a barrier by continuing to work to decrease airfares; how?

- We'll continue to introduce competition on existing gateways, specifically low cost carriers.

- We'll move to negotiate air service agreements that include airline financial support to help underwrite marketing initiatives

- We'll continue to enhance airline partner relationships by increasing frequency of contact and communication

- No, this is not new or earth shattering, it is a continuation of the implementation of the airline strategy and plan that the team in Transport have so aggressively and successfully pursued. I commend them today for their on going efforts.

We will: Develop and grow new geographic markets, how?

- We will implement aggressive European and South American market development programmes focusing on key high potential gateways as identified through market potential studies. And yes, the European gateways - include Italy and Germany. When traditional markets go into decline it's necessary to change and while our efforts in these two markets are not entirely new, we've begun to see the promise in these markets and intend to earnestly pursue it.

- Again, our steps in this regard will be “purpose driven”. We will first negotiate agreements with airline partner(s) to provide direct air service (charter or commercial carriers as applicable). I'm pleased to report that aggressive discussions are currently underway with regard to Italy and it is my hope that we will have positive news to report on this front before the end of the first quarter of this year.

- Simultaneous to the airline negotiation process, we will strengthen relationships with trade partners including bringing the necessary tour operators to the table to assist with our endeavors in those European markets.

- And finally as a part of this process will engage the relevant sales, marketing and communications partners or representation companies in those markets with a view to creating awareness and converting visitors.

We will: make the Bermuda product relevant to the target audience, that is, develop & enhance the product. A tall order, yes indeed! We need new, revitalized hotel product. We must therefore market the Bermuda hotel industry as a viable option for local and /or foreign capital investment and re-establish hotel facilities on land zoned for tourism use, thereby increasing the bed stock and the diversity of the Bermuda hotel product offering.

- To this end, the Department of Tourism has retained a Hotel Development Consultant. I'm pleased today to introduce to you Mr. Chase Burritt. Mr. Burritt of Burritt & Associates comes to us with a wealth of hotel development experience. As Hotel Development Consultant for the Department, Mr. Burritt will assist the Government in consolidating and clarifying our hotel development policy.

- Beyond the hotel product is the issue of the attractiveness and marketability of the events that we use to drive visitors to the island. We will therefore establish a formal event marketing programme to create more appealing events by evaluating existing events and changing, adding or eliminating events as needed to appeal to our target markets.

- To assist with this endeavour I am pleased this morning to announce that we have evolved the role of former Golf Consultant Mr. Roddy Carr of IMG. Mr. Carr shall act as a consultant to the Department of Tourism for the development of a sports, active, and lifestyle tourism event plan for Bermuda. His role will be to define the most suitable sports for hosting major events in Bermuda. He will identify and assist in securing suitable major ‘World Class' events for Bermuda; determine the optimum number of events on a ROI basis and identify and/or propose mass participation events that will provide bed nights to Bermuda on an ongoing basis.

- Visitors arrive on our shores with expectations of participating in world-class activities. It is incumbent on us therefore to create the framework for the development and upgrading of golf courses, spa facilities, scuba diving facilities, sport fishing operations and other highly attractive niche segments. You will be aware that a report that maps out the way forward for the development of the Government Golf Courses was produced last year. We endeavour to drive that process forward in cooperation with the Trustees of the Government Golf Courses. Additionally, we will bring the same focused attention to the other areas of our activities offering as outlined, with a view to identifying the barriers to world-class development and working to remove those barriers to stimulate enhancement.

- The absence of a convention center has been identified as a barrier to the growth of our group and incentive business. We will therefore explore the development of a Convention Center while simultaneously assisting the Trustees of the National Sports Center to realize the completion of the site thereby allowing for the exploitation of the National Sports Centre as a multi-purpose facility for group, meeting and convention business.

- And finally, the celebration of 500 years since the discovery of these islands presents a tremendous opportunity for us to build on the historical and cultural aspect of the island throughout the course of the year. We shall package the special Quincentennial activities planned for 2005 and capitalize on presence of the Amistad which will return to Bermuda in May.

Strategically we will move to position Bermuda as a year-round destination. I've said it before and I'll say it again, we can no longer operate as if we accept this thing called an off-season.

To begin to realize results, we will:

- Sell Beach & Sizzle (sun, sand and surf) during the summer months

- Golf & Spa during the fall and winter months

- Use sports tourism and event marketing to supplement arrivals during the entire year and:

- Build on Group & Incentive travel throughout the fall, winter and spring periods

Ladies and gentleman, nowhere in the world are there better beaches than here in Bermuda, why is this such a big secret these days? And why can't a visitor or a Bermudian enjoy an alcoholic beverage on our finest beach?

In Bermuda we have eight terrific golf courses available to amateur golfers within two hours from the east coast. These courses are perfect for playing a few rounds during the fall and winter months when the courses on the east coast are iced over and the frustrated amateur just wants to get out there and play!

Positioning Bermuda correctly is key. The right message at the right time will drive the right results. It doesn't have to be complicated. It's a simple straightforward message.

It goes hand in hand with our desire to: Create demand and drive conversion. This is a most awesome task, but not insurmountable. This is our sales and marketing challenge. Making Bermuda hot. Making Bermuda relevant. Creating a desire to visit Bermuda, not someday, but today. The term geo-centric marketing will become apart of our vernacular as we redefine our approach to marketing, looking at each regional market as a whole, as opposed to a part of a whole. What motivates a prospect in Boston for instance to consider Bermuda is not necessarily the same thing that motivates a prospect in Atlanta. We will therefore work hard to understand each market more intimately and develop our marketing programmes accordingly. Tactically we will:

- identify and establish relationships with the influencers/socialites/power structure in each regional market and invite them to Bermuda

- Develop and implement celebrity partnership programmes

- Develop and implement affinity partnership programmes

- And as I've said, develop regional sales & marketing programmes that capitalize on the nuances of each market; the programme will include: integrated sales, advertising, public relations; web, viral and direct marketing activity, notable in this instance is the fact that the sales programme will become a fully integrated part of the marketing activity. These are but a few of the tactics that will be embraced to create demand and drive conversion.

- I'm pleased today to introduce Marketing Consultant Mr. Don Coleman. Mr. Coleman has been retained to assist with the strategic development of Bermuda's marketing programme.. Mr. Coleman is the President of the largest multi-cultural agency in America, GlobalHue. He brings with him a wealth of marketing experience, a fresh, new, and innovative approach to market segmentation, consumer behaviour and target marketing on a regional level. He will work with us to develop and implement our geo-centric marketing plans. In fact GlobalHue is spearheading our marketing efforts to promote the American flight out of Miami that commences on March 2nd.

Our conversion related activity will lead to increased overall arrivals and yes, we must manage the big picture. Therefore we will Achieve our daily carrying capacity through effective management of cruise arrivals.

It is the belief of the Ministry that effective management of the daily carrying capacity provides for far greater flexibility from an industry management perspective then artificial limits on cruise arrivals. Air and cruise arrivals must coexist. Our job at the Ministry is the effective management of tourism arrivals so as not to overburden the infrastructure. A formula has therefore been devised that allows us to effectively manage the cruise arrivals in view of potential air arrivals at any one time.

There are a number of ways that we've determined that we will manage the overall arrivals. This will be accomplished through extending the cruise season encouraging the cruise lines to sail to Bermuda during March, April & November and introducing more upscale ships.

Our third objective is to “Increase visitor “complete satisfaction” indicators by 10%”. Our plan is to enrich the visitor experience and there are a number of very aggressive action steps that we will take.

We cannot take our visitors for granted and we therefore encourage the participation of every Bermudian in our efforts to engage our visitors through participation in our new Pop-By Programme - a visitor interaction initiative.

- Imagine the scene at Horseshoe Bay Beach for instance when one stands and looks down the beach at an array of colourful flags inviting the visitor to Pop-By for chat. The flags will be a sign that “I am Bermudian and I am approachable, I welcome you to my island and I'm happy to share with you”. Here are the sample flags. To provide an incentive for participation, Barritt's has agreed to come on board as a sponsor and they will give everyone who collects a Pop-By flag a complimentary six-pack of Ginger Beer.

- Other initiatives designed to enrich the visitor experience include:

o Support for the National Concierge Programme

o Expansion of the Blue Flag Taxi Programme so that it is more inclusive

o Revisiting the African Diaspora Heritage Trail Programme

o Enhancing Nightlife to ensure that there is an entertainment option for our visitors every night of the week

o Addressing service delivery issues and;

o Putting the Bermudian identity back into Bermuda tourism

- Nightlife, music and entertainment are the heartbeat of a destination, yes; and it is a well known fact that tourists are cultural junkies, they visit a new place to collect new experiences. To feel the true pulse of a destination they must experience the people. In addition to the Pop-By initiative, designed to get locals and visitors interacting more, the Bermudian people have to be the ones that are providing the wide variety of services that the visitors are taking advantage of. There must be evidence of the people at all levels within the industry and therefore we will work to motivate Bermudians to return to the hospitality industry. I strongly believe that staff housing for Bermudians will serve as an incentive and one industry partner, an hotelier, has already obtained permission to begin construction for staff housing.

- I have made a personal commitment to introduce Bermuda's students to Tourism. I will personally visit every primary, middle and high school in Bermuda. These special assemblies have already been scheduled and my first visit will occur later this month. At the very earliest levels it will be purely an introduction to Tourism. At the high school level it will be a hybrid of both awareness and career opportunities. Tourism has changed ladies and gentleman; it is not the same industry that it was when my father, my uncles and my cousins worked in the industry. It's a brand new industry and we must encourage our young people to take a fresh look. The industry needs more than Bermudian waiters. Hotels need Bermudian Food & Beverage Directors, Bermudian Accountants, Bermudian Engineers, and Bermudian General Managers.

- The school visit programme will culminate with a national tourism student debate. There will be three regional debates - East, West and Central. The winner of each regional will move on to the final. The winner of the finals competition will be named Junior Tourism Minister and will represent Bermuda at the Caribbean Tourism Organization Annual Conference.

- To further encourage our young people to consider a career in tourism we will continue with both the Scholarship and Internship Programmes that the Department had previously established.

- Improving service standards goes hand in hand with encouraging Bermudians to return to the industry. Our visitors expect five star service when they come to Bermuda. Service standards all over the world have outpaced those standards here in Bermuda, therefore it is imperative that we stimulate the development of industry service standards and support the implementation of an industry service training programme to improve service delivery across the hospitality industry (this to include: retail, restaurants, activity providers, hotels, etc.); across the board, at every visitor touch point, our service delivery must be impeccable. Our people must once and for all distinguish service from servitude.

- To this end we must engage the Bermudian people in tourism dialogue and later this month we will launch a new interactive radio programme, called “Wake-up Bermuda - Tourism Now”, with host Rodman Woolridge. Mr. Woolridge has a wealth of experience in the hospitality industry and he will engage the public in tourism related discussions. The programme that will air on Hott 107.5 will be interactive including call-ins, giving the public the opportunity to share their views and opinions on a wide variety of tourism topics. The community has been sidelined for too long. There has been no formal or informal mechanism to gauge their opinion on specific tourism matters. We need to know what they are thinking. They are a part of the solution and we need their feedback.

Finally, improving environmental management and planning will undoubtedly impact the visitor experience. We will therefore work with other Government Departments to preserve and conserve the natural beauty of our island. This also includes further exploration of alternative methods of transportation. Our Ministry is currently giving thoughtful consideration to a request from the BHA for hotel shuttles and urging some entrepreneurial Bermudian to go into the water taxi business.

With the effective implementation of these strategies and tactics we are confident that we will have a positive impact on the overall visitor experience.

Meeting the fourth objective to: Increase per person visitor spending by 7% depends heavily on our collective ability to diversify our product offering - enhancing dining, shopping and nightlife. The Department will take all of the necessary steps to disseminate information about visitor trends, work with other Ministries as applicable and encourage product development through the implementation of various programmes. Meeting this objective however requires the private sector to think out of the box. Bring us your innovative programmes and we will ensure that the visitor is aware of them. More aggressive on-island visitor communication will increase awareness and create desire for your product offering. Increased spending will be the result.

Our fifth and final objective is to: Enhance Tourism Department efficiency, effectiveness and productivity. It is my firm belief that the industry administration must be held accountable. The requirement therefore is clear, the industry has changed, advances in technology, the internet and ecommerce is driving this change and now we must modify the business model to reflect these changes. In order to achieve this we will re-evaluate how the BDOT spends its resources against wholesaler/tour operators, national accounts, hotel partners, and others, eliminating or shifting spending as applicable.

This re-evaluation extends beyond our stakeholders and has caused us to take a look internally as well. We can no longer afford to sustain an infrastructure that has proven to be ineffective in modern times. We will therefore transition from regional sales offices to satellite home offices in primary geographies supported by one central sales office. Effective March 31st, we will transition staff to home offices in Canada and Boston, the physical plant as we know it today will no longer exist. Our people will be out in the field engaged in the sales process in a way that is new for Bermuda. The home-based sales managers will be supported by sales support staff located in the New York office. These are modern times and thus we need a modern structure. Within the next 18 months we envisage that all sales staff will be home-based and only one mega central office will exist in North America. We cannot expect change if we ourselves are unwilling to change.

The North American Sales office will become our global hub for sales administration and tour operator management. To this end, Senior Sales Manager, Mr. Thomas MacDonald will be seconded to Hills Balfour, the Bermuda representation company in the UK to begin the process of creating synergy between the two sales operations so that we might eliminate duplication and maximize our resources.

We will bring new energy and greater depth to the sales team through the implementation of the “Bermuda Points of Light” Programme - a pay for performance initiative using well connected Bermudians living overseas; and friends of Bermuda, to deliver verifiable business to our shores. We will engage such individuals and pay them for delivering groups of 25 or more. These people will not be on the Bermuda sales staff payroll as full time employees and they will not be supported by our sales team, they will serve as independent contractors who are motivated to sell simply because they love Bermuda and can deliver business in exchange for a financial reward.

New spending guidelines will be developed within the Department to direct each group on how it will spend the allocated resources to further eliminate duplication and overspending where it may exist today. This of course has implications for our agency relationships. We will evaluate agency relationships with a view to reducing agency costs, reviewing accounts and making changes as applicable.

We can no longer run an education/awareness-based organization. We must therefore develop a sales culture within the Department of Tourism; an organization that is focused on success; an organization that recognizes and rewards outstanding performance.

Of course we will take all of the necessary steps. A timeline to conduct a needs assessment has already been established. The implementation of a training programme designed to shift the organization from information based to sales oriented, inclusive of sales training is work-in-progress. In a few weeks the entire sales force will arrive in Bermuda to undergo an intensive 4-day sales training programme. Follow-up training will be required and provided on an on-going basis.

Within the new organization everyone will sell everything. No more group and leisure sales silos, that's old school. Today's team will simply sell Bermuda.

We will remove the obstacles that inhibit sales success and begin measuring individual employees' sales performance. This is important as we will reward top sales performers with incentive compensation. The sales team by definition is highly competitive. We know that they like to be challenged and need targets that they can aim for, we will work with them to ensure that they achieve their true potential, not just for themselves but for the greater good of Bermuda tourism.

As a side note, we will upgrade the administrative structure and physical plant. The industry can be assured that the DOT will be the point of contact for all industry matters and things will get done. The Department for instance has already moved to establish itself as the hotel development applications conduit and is working to improve the management of the hotel development process by ensuring coordination and cooperation between the different Government agencies, and it is working.

Only a few days ago I met with the restaurant industry and they've expressed dissatisfaction with Immigration procedures, I pledge to take this under advisement and meet with my Cabinet colleague.

Working with our partners is an important component of the success of tourism. We seek the cooperation of businesses and community organizations in the implementation of this plan. When you assist us in reaching our goals you are much more likely to receive our support and assistance.

And finally in order that we might all be effective we must Measure, Track and Communicate Results. There's a long held view that raw arrival numbers represent the key performance indicator. I maintain that when we do this we are not comparing apples to apples; therefore we must identify and agree key performance indicators.

Ladies and gentleman, notwithstanding all of the above we are faced with a marketing challenge. If we are to maintain and accelerate our upward trend with regard to hotel occupancy and economic impact, we must do a better job of convincing our target audience that Bermuda IS the place for them to visit and, as GlobalHue would say, “Feel the Love.”

Bermuda must reach and convert first time visitors to our shores in significant numbers. We must convince the target that Bermuda is a place to visit “today.” Bermuda must be top of mind, Bermuda must be considered relevant, and Bermuda must be considered HOT.

We will not share a sales & marketing plan with you today. This is forthcoming. The integrated team has been issued a brief that lays out a new strategic direction and they will deliver within the next few weeks a plan that reflects this new direction.

I will however pause here to share the flavour of things to come in the short-term:

- Recently we conducted a casting call looking for the Voice of Bermuda. I am pleased to introduce to you both the male and female Voice of Bermuda:

- Mr. Sean Tucker and Ms. Denniqua Burrows.

Ms. Burrows voice is featured in the new golf spot that will air across America this week.

In support of the new American Airlines flight out of Miami, we've isolated the market and multi-cultural agency GlobalHue has been charged with developing a geocentric campaign and Images USA have been retained to target the African American Market in our target areas.

Ladies and gentleman, I am personally committed to the success of this programme and so are the members of my team at Tourism & Transport. Why are we so positive and why are so excited about the future of Tourism in Bermuda?

Because, ladies and gentleman, there is no place on God's earth like our country! I mean that and fortunately I have had the opportunity to see for myself. There is no place on this planet that is as naturally beautiful and clean as Bermuda! There is no place on the earth whose people are as friendly as Bermudians!

And, by divine design we are located less than 700 miles from the Eastern Seaboard of the United States. When you add to those natural blessings the wonderful array of restaurants, our unrivalled beaches and safe ground transportation, Bermuda is impossible to beat!

That's the Bermuda we shall be selling and that's the Bermuda we want you to sell. I call upon every Bermudian to join in this important effort so that when we achieve our goals, we can say that we did it together as one people.

Thank you very much!