Travelling in style: staying power, diversity, and the emerging elite niche.

This is a balmy moment for Mexico's tourism sector. Tourism is the No. 3 source of revenue in the country, representing 8.2 percent of GDP. The 1.7 million people it employs have worked hard to earn it a worldwide prestige that has become especially evident over the past four years.

Armed with a newfound maturity, the industry has a bright future well beyond sunburn and hangovers.

This is something to write home about in an increasingly competitive global tourism market.

"There have never been so many travel magazines and articles, as people devote a higher percentage of disposable income to travel," said UK-based publisher Nigel Bolding, shortly after the December 2004 launch here of the book "Mexico Chic", originally conceived for the lucrative European travel market.

"People are more adventurous than they have ever been and there are so many niche operators out there."

Standard expectations have changed, said Brian Seagrave, general manager of the W Hotel, which opened in the Polanco district of Mexico City just over a year ago and caters mostly to business travelers.

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"Five years ago, having high-speed Internet was a differentiator, but now it's standard. Before, spas were special, and hotels just had a fitness center, while now the move is towards around-the-clock spa service."

Luxury Market

One of the observers/players in this future is Guillermo Osorno, editor of the Mexican travel publishing phenomenon Travesias. Despite the hurdle of launching just before 9/11, the magazine soon gained a reputation for being "the Conde Nast Traveler of Mexico."

The magazine's Mexican readers (it is also distributed in South America and the United States), ranging in age from 25 to 40 and primarily based in Mexico City, Guadalajara, Monterrey, Puebla, Guanajuato, Veracruz and Cancun, are surprisingly affluent, Osorno said. He knows this because Travesias regularly commissions polls and surveys into the travel habits and the tastes of its readers.

"Every day there are more people seeking unique experiences," Osorno said. "When we carry out qualitative analysis, we see a growth in ecological and sports tourism."

The tourism market for Mexico has become more refined since 2001, Osorno affirms. "Mexico is every day more suited for the luxury market, with a greater offer of corresponding hotels and destinations."

Marketing 'Diversity'

Mexico's obvious tourism strengths are its 6,000 miles of coastline and its fine climate.

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However, it is Mexico's diversity that puts it at the cutting edge, responding to new global trends and developing new international, and national, markets.

Although over 80 percent of tourism in Mexico is national, and beach resorts are still "the main reason" for international tourists to visit the country, its cultural offer is what makes it unique.

Mexico's diversity--marketed beyond dreariness as "los muchos Mexicos"--is evident in the varied geography, flora and fauna. Its varied "tangible" cultural heritage is seen in pyramids, colonial churches, rambling haciendas, pretty contemporary Maya villages, and modern efficient cities such as Monterrey.

Less tangible, but just as attractive, features range from cuisine to ethnicity, ranging from Zapotec communities in Oaxaca to the Purepecha in Michoacan and many more up and down the country, especially in the southeast.

Most important for the tourism sector, the diversity is firmly established in the country's wide range of tourism offerings, from budget and backpacking, charter groups and package tours, to exchange programs and cultural tours, business, conference and incentive tourism, eco-adventure tourism, and luxury or high-end tourism.

You can snuggle down with five other people in a cozy cabin on the Malinche volcano for only 520 pesos per night (i.e. just over US$8 per head), or you can pay about US$4,000 per night for presidential suites in the Camino Real, the W, or the tried and tested Four Seasons.

Best of all, however, somewhere in between, you can pay from US$70 to US$500 for a room in design or boutique hotels and converted haciendas throughout the country.

Boutique Authentique

This segment is not new, but is newly consolidated as a niche category with an official name: "Turismo Premium," for the Mexican Tourism Board (CPTM for its Spanish initials). Under this heading, the government tourism promotion office groups boutique hotels and haciendas, golf, spas and nautical tourism.

"The premium visitor's daily expenditure is approximately double (or more) that of the average tourist visiting Mexico," said the CPTM's marketing division director, Luis Manrique.

"It is not common for the elite tourist to make use of any tourism package service; instead, he'd rather visit the country with his own plan and chose his own hotel according to his preferences."

However, there is an important precursor to this niche recognition, a small hotel association started by an astute, Puerto Vallarta-based Canadian.

Founded in 1999, Hoteles Boutique de Mexico, known as HBM in Spanish (or Mexico Boutique Hotels, MBH, in English), helped identify and create this market. This company is now referred to and quoted by the CPTM in its latest documents on the sector.

The association (www.mexicoboutique-hotels.com), currently boasting 31 member hotels in 20 destinations, is essentially a full-on reservation service with state-of-the-art travel information and the ability to coordinate extensive circuit trips. Its original aims were to help travelers find the kind of small, exquisite hotel, distinguished by personal service, that MBH founder John Youden liked himself--ones that were not part of a larger group or chain.

Within three years, copycat companies were proof of the pudding. This was the way to go.

Major chains joined in the happy chaos, starting to misuse the term "boutique" in the heated scramble to be up there, blabbing out the word indiscriminately, sometimes applying it with unintentional comic effect to hotels with 100-plus rooms.

Others followed suit in a more cautious fashion, realizing that MBH was more than just "in the right place at the right time." It was also offering quality service, analysis and follow-through. Some adopted elements of the group, such as Starwood Luxury Collection with El Careyes Beach Resort & Spa and El Tamarindo Golf Resort & Spa, both on the Pacific Coast's Costalegre.

"After qualifying the hotel for suitability to our concept--which includes individuality in style and character, intimacy of size and idyllic settings (or, in the case of city hotels, prime locations)--personal inspections are made to ensure that the physical attributes are supported by our cornerstone requirement: outstanding personal service," said Sylvie Laitre, MBH director.

"Inspections include everything from linen to food quality, but genuine hospitality is necessary to make the mark."

Diverse And Unique

Villa Ganz (www.mexicoboutique-hotels.com/villaganz) in Guadalajara would be a good example; a small palace where you are served an unsolicited glass of wine and a snack as you check your emails on the laptop by one of the antique fireplaces. The linen is the kind that makes you go to bed early, and take all your paperwork between the sheets to make the experience last as long as possible.

With regard to what executives are seeking, Laitre says, MBH requirements are twofold: "Since our parameters encourage diversity and uniqueness, we appeal to the elite travelers' varied tastes, and our emphasis on service levels concurs with their greatest expectations--being catered to in an unpretentious and sincere manner.

"To put this into context, one hotel may be remote and rustic while another could be the ultimate in sumptuousness, but both will have the 'people factor' that puts them at the top level of hospitality."

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Examples here would be the company's dream getaway on Holbox Island, Hotel Xaloc, with its gritty and informed boat crew who accompany guests on the whale shark tour, and the Hotel del Angel in Puerto Vallarta, whose cocktail hour lets you soak in the glamorous lifestyle of the guests whose only worries are getting permission to knock down walls of their new mansions, and that their dogs fly in comfort.

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Five years on, MBH knows the high-end tourists here to a "T." They are used to being pampered, being in charge, getting what they want and having "staff" handle details for them, Laitre says.

The trends she saw for executives in 2004 are truly to get away from it all.

"They do not want pre-fabricated packaged holidays that have no essence or authenticity. They do not want to be bothered, talked to by people they do not choose to associate with. They want privacy, great service and 'attention without intervention'."

At the same time, "the tourist bubble" created for the package holiday guest who speaks no language but his own, and feels threatened by unfamiliar food or mealtimes, is not what the elite tourist is after.

The Hacienda Xcanatun, an MBH member, notes that searching for new experiences is key to a successful vacation break.

"We find our guests like the fact that the hacienda is not just for foreigners. They have a chance to mingle with affluent members of Merida society."

While there are slight differences in defining exactly who the high-end tourist is, everyone agrees that this market has a real-time deficit and will not suffer fools.

Where To Go

So what are the hot destinations for this market niche?

Mesones Sacristia says colonial cities and Los Cabos. Laitre says, "For us, the hottest hotels were practically destinations unto themselves ... San Miguel de Allende continues to be strong and Morelia is definitely growing in popularity."

The Tourism Board underlines Loreto and Los Cabos, Puerto Vallarta and Nuevo Vallarta, Cancun and the Riviera Maya and haciendas in the Yucatan.

Ironically, once it has reached credibility factor, the problem in the niche is who to believe. Everyone, from the government to the small entrepreneur, wants to sing the praises of the destinations they are investing in and, at this level, there are no bad apples.

In addition, a little stardust certainly does no harm. Everyone in the niche recognizes that celebrities and glossy magazines are their best friends, along with old-fashioned word-of-mouth.

Satisfying Clients' Needs

Finally, a blink away from the bright lights, one recurrent issue in this segment in Mexico is that often the client knows more about what the service should be than the service provider. This is often a problem with spas, despite Mexico's success in creating last year a legal standard to which spas should adhere.

A wider ramification of this phenomenon, one where past sloppy practices, infighting and "politics" are still painfully evident, is when the individual boutique or elite hotel--or even just an efficient hotel that serves a sufficiently foreign clientele--knows more than the local tourism authorities, and exposes government inefficiency.

Elite tourism makes it clear that many service attitudes still very prevalent in this sector in Mexico are hopelessly outmoded. With the spotlight on this niche, there is a push toward change that will probably benefit tourists--both international and national--in the lower-spending echelons as well.

By Dr. Barbara Kastelein

Dr. Barbara Kastelein writes about travel in Mexico for the Herald, Travesias magazine, Fodor's Travel Publications and Brides magazine.