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Diamond Anniversary

Club Med where life begins at sixty

Dr. Elinor Garely, eTN  Feb 07, 2011

(eTN) - It is hard to believe that Club Med (Club Méditerranée) has reached the “boomer” stage in the product lifecycle. If you were single and under 30 (in the 50s) the place to take a vacation was Club Med. Known for the sexy and very friendly GOs (Gentils Organisateurs/Gracious/Nice Organizers), many generously went beyond their job descriptions to make sure their young and attractive (or not) guests had a wonderful time (the more obliging the bigger the tips).

There were no secrets (although there definitely was competition), and tents (evolving into hotel rooms) were sparse but efficient. Part of the allure included doors with no locks and teeny bikinis combined with the spirit of cumbaya, laying the groundwork for wonderful week(s) of swimming, sunning, sex and perhaps a game or two of volleyball.

Stylishly Youthful
At 60, Club Med firmly grasps the ring for high-energy holidays; keeping guests amused, fed, bedded and coming back for more (83 percent of guests return every three years). The mantel for keeping the first all-inclusive resort/destination model off life-support and guests actively on the tennis courts, golf courses, swimming pools, and engaged in marathon and ironman training was recently bestowed upon Xavier Mufraggi. As the 33 year old CEO of the North American operation, Mufraggi oversees a US$290 million operation, directing the activities of over 2200 employees.

How did he get to the top of the pyramid while many of his contemporaries have yet to find the first step is not a mystery to this self-assured CEO. He gives credit to his excellent education, having earned a Masters degree in Marketing and Sales from EDHEC (1999). He also offers a salute to Kraft Foods (1999-2005) for the development of his leadership skills and he even admits to being challenged when he moved from mass media to online marketing as VP Marketing for Club Med North America (2005-2008). Three years later he earned the top slot as the organizations CEO where he imaginatively directs North America and Caribbean operations.

Being First…and Right
According to a R. Adners’ research study, Club Med: From Value Innovator to Follower, the organizations original success was based on “four pillars:” transportation, accommodation, food, sports and entertainment, thereby creating its own niche as a “value innovator.” The vision, conveyed to guests in the form of end-to-end, hassle free experiences, with only one concern – which Club Med to visit next, continues to this day.

Middle Age Hits
Although Club Med started with a young adult focus, it changed direction as its guests morphed into “married with family” and its princely reign lasted until the late 1980s when competitors like Sandals and Super Clubs in the US and Caribbean connected with large tour operators in Europe and developed targeted destinations and products for singles and young adults.

The Club Med model did not adapt to the concept of market segmentation. It ignored the fact that markets are “mutually exclusive” and, according to Adner, “…it is not possible to serve more than one market with the same product at the same time and certainly not with the same brand.” Adults and singles tend to avoid properties overrun with children while families dislike highly active inebriated adults disturbing their children or their naps.

We Get It
Rather than give up and go home, Club Med found traction in 2005, and is aggressively meeting the new demands of a competitive marketplace with innovative products. In 2006 and 2007 Club Med and partners closed some resorts while upgrading others thanks to a US$530 million investment. In 2010 Club Med villages had an operating income of US$58.4155 million while reservations for the 2010-2011 season were up 14.7 percent.

Courting the Chinese Market
Contributing to the current success of the organization is a new partnership with the Chinese Fosun organization, a privately owned development company who acquired a 10 percent equity investment in Club Med in June 2010, becoming one of organizations largest strategic investors.

China is projected to become Club Meds second largest market. In 2010 the number of Chinese guests increased by 42 percent over 2009, with 32,000 Chinese vacationing in Asia Pacific Club Med villages; the number increases to 60,000 when guests from the entire Greater China market are included. Club Med plans on increasing Chinese visitors to 200,000 by 2015. The organization also intends to open five new villages in China over the next five years. To support the villages, Club Med Corners, upscale travel agencies, are opening in major Chinese cities.

Firm and Fabulous
In 2008, a multi-million dollar 24-country marketing campaign was launched, heralding the opening of a ski resort in Yabuli, China, a property in Sinai Bay, Egypt and Club Sandpiper Bay in Port St. Lucie, Florida. The Sandpiper is the only all-inclusive family resort in the United States, and is destined to be the flagship for Club Meds Premium Sports resorts. To emphasize the importance of sports to the property, Heather Gollnick a professional tri-athlete and five-time Ironman Champion has been tasked with directing the Fitness Academy, providing multi-sport athletic guests with a five-lane lap pool, open water swim course, golf course running trails and events (i.e., sprint distance triathlons, Olympic distance triathlons, and 5K/10K running races), plus personal training.

Club Med continues to offer guests one-stop shopping including: arrangements for air, airport meet/greet, transfers, tips, room selection, dining and dining-room options, bars, Club Med Baby Welcome, child supervision, Junior’s Club Med, varied activities, entertainment and other leisure options. Once the selections have been made – the only responsibility of the guest is to have a good time.

Additional information on Club Med opportunities are available at: .

Club Med where life begins at sixty
Xavier Mufraggi, CEO, Club Med North America

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