11/08/2019 16:52

Advertising instead of money

[IMG=18355-3943] From the 1st of January, the Ministry of tourism of Croatia closes the system of special subsidies for tour operators and organizers of charter flights to the country. This course of events was forecasted by BANKO back in August (see News as of 22.08.2005). Subsidies were granted to consolidators on the basis of 250 kunas (34Euros) for each tourist brought to the country if programs are not shorter than 24 weeks with flight frequency of more than once in ten days. The European Union put forward the ‘grant’ as Croatia intends to accede and could not do so with the grant in place. ‘The European community will not accept such a practice’, commented Mladen Falconi, head of the Croatian tourist office in Moscow. He also highlighted that the Ministry of tourism of Croatia hopes to invest the budget created by canceling the subsidiary in promoting the country. ‘Next year we will spend the corresponding $3 million on TV advertising and joint projects with tour operators’. Market experts note that sums of money allocated for promoting holidays in Croatia are very impressive for such a small country. By comparison Turkey spent $6 million for its promotion in Russia. Despite the promising advertising budget of Croatia and the fact that requirements for the cancelled subsidiary were very strict: active tourist season is not very long and it is not that profitable to maintain long charter programs. For these reasons, tour operators took the news about the closing of the program with ambiguity. Kseniya Ogienko, director of tourism in UTE Megapolus group expresses the common opinion of ‘those criticizing the new rules’. In an interview to BANKO she said: ‘Working with the old scheme, we received money in cash and invested it in the Croatian destination, now it will be imposed that we participate in advertising’. In practice, it is easy to understand why tour operators are not excited about the decision of the Croatian authorities to abolish subsidiaries – as they currently receive cash. The company can always use it for the company’s good. However not always do operator’s interests coincide with the interests of the destination. However if 3 million dollars will be used for mass advertsing, this will undoubtedly have a positive influence on demand. The Croatian office of tourism, represented by Mladen Falkoni, views the future with optimism. According to him: ‘In the first ten months of this year 85,000 Russian tourists visited Croatia’. This is 20% more than over the same period in 2004. Next year the tourist flow will increase by 25-30%’.