Delfin has pioneered expedition cruise tourism in the Peruvian part of the Amazon region over the last decade. What are the current opportunities available for companies operating in the cruise and tourism sector?
Peru has different climatic, geographical, and archeological areas, each of them representing an opportunity. Those regions supply unique and varied destinations that have cultural, archeological, geographical, and wildlife potential. Tourism is a much-segmented industry as well, defined by products and experiences, not businesses. There are different layers along the distribution channels before it is possible to reach the final traveller. The first step is local DMCs, or the local travel agency, followed by tour operators abroad, and finally the individual customer, group, or family who seek services and products. Tourists currently seek authenticity and the chance to have an experience more than anything. People do not necessarily want to go to the jungle in the Amazon basin, where we operate, and stay in a five-star hotel. They want to experience the rainforest and do so with a product that is integrated with that environment. In Peru, many make the mistake of still thinking of tourism in the old sense, as just luxury hotels and convenience or comfort. But those choices usually, if not always, lack authentic concepts. Mexico, for example, implemented a program to further increase the inflow of international tourists based on adding value to several small town destinations with strong cultural and archeological content, named “Little Enchanting Towns" and located throughout Mexico. The program consisted of a combined financial effort between central government and the private sector, effectively rescuing the essence of these towns' culture, their history, their architecture, and their authenticity by restoring their main squares as well as surrounding buildings. Afterwards, the private sector became committed to developing small boutique hotels and restaurants. Everything was restored using the original materials and architectural designs from the marketplace's past history. And it worked, as this way they were turned into unique and very much authentic new destinations true to their essence and their particular feel. These are all key content elements to provide travelers with what they want; unique authentic experiences. San Cristobal de las Casas was one of the most famous examples, and today hundreds of thousands of tourists visit that little town year round. Another example is the small fishing town of Trancoso in Bajia, Brazil. We need to do the same thing here in Peru. We need to implement these kinds of programs to provide the private sector the grounds to develop new, long-lasting, and high value-added businesses in the tourism sector. We must stop the indiscriminate building growth of infrastructure at large in most of Peru's towns, which boast a tremendous historic architectural and cultural heritage. Opposite to San Cristobal de las Casas in Mexico and Trancoso in Bajia, Brazil, because of the lack of a central administration, clear vision, and master plan for tourism, almost all new construction is rather quickly destroying all these places' potential as new, attractive destinations for international travel. Instead, we must renovate what needs to be renovated, regenerate the city centers where needed, as well as add infrastructure such as boutique accommodations while mandatorily rescuing their true architectural essence. Unfortunately there isn't a central administration master plan for the tourism sector. We do not even have a Ministry of Tourism, although we do have a Vice-Ministry of Tourism as part of the Ministry of Foreign Trade, Commerce & Tourism. This Office has the ability and the will to assist the private sector contribute to these kinds of projects, but the existing political structure is too segmented and convoluted, thus restraining their efforts in this direction. In Peru, ministers do not have the power to regulate anything specific in any region or part of Peru; they can only make suggestions as the decision-making power is all in the hands of the regional governments.
What segments do you target at Delfin?
We target the high-end segment because that is where we are most comfortable in terms of risk, revenue generation, and profitability. The upper segment, characterized by small-size businesses, high prices, and high margins meets our conditions and vision of moving forward and upward. It is also important for conservation and preservation. All of Peru's most famous, precious, and popular destinations are located in places that cannot handle large numbers of tourists. Machu Picchu, Arequipa, Nazca, Trujillo, Chiclayo, and the Amazon are all the fantastic places but all of these destinations are all very delicate and fragile and they can't sustain large volumes. That is why we target the high-end segment, because these places are not suited to mainstream markets.
How do you overcome the lack of qualified personnel and human resources in Peru?
Tourism is generally not considered a viable career for well-educated professionals, so finding the right people can be difficult. And yet you have to be every bit as professional and corporate in tourism as in any other sector, especially if you want to grow, improve, and prosper. Unfortunately, the schools that offer tourism courses do not provide an adequate curriculum. They have to be more corporate. We need to do more work marketing the sector well. The regulations, taxes, and legal framework all require highly trained, dedicated, and top-notch professionals. We need to attract more people to the industry, educate and train them at a higher level, and also lay the framework for a better, more centralized, and more efficient decision-making apparatus that has the capacity to create and follow strategic long-term visions. Countries in the same region as Peru and close by ones such as Chile, Colombia, Ecuador, Argentina, Brazil, Panama, and Costa Rica are far ahead of us in this sense, and they do not have destinations that are on par with what we have in Peru. It is a competitive world and region overall, with Ecuador's Galapagos, Brazil's rainforest, Argentina and Chile's Patagonia region, and Costa Rica and Panama's protected natural reserves. So we need to react by introducing serious changes in Peru's political structure and decision-making process with regards to tourism.