Olympics focus: Rio de Janeiro

This summer all eyes will be on Rio as it hosts the Olympic Games – including those of travel and incentive organisers. Barry Dunstall reports on the run-up to the games and impact of the Zika virus

Hosting the Olympics is a serious business. Why else would Barack Obama have flown to Copenhagen in 2009 to make a passionate, last-minute address to the International Olympic Committee (IOC), supporting Chicago’s bid to host the 2016 Games?

In doing so, he became the first current US president to personally lobby the IOC in an attempt to win the Games for his country. Unfortunately for the POTUS, he lost out to another first – Rio de Janeiro took the prize. This August, Brazil will become the first South American country to host the Olympic Games.

Alongside the sporting excellence taking place in the stadia, and the parties and volleyball taking place on Copacabana beach, from August 5-21, hospitality suites around Rio will be buzzing with corporate chatter.

Many of the world’s biggest brands and businesses – from Coca-Cola and Visa to McDonald’s and Panasonic – are ‘Worldwide Olympic Partners’.

Impressive stats
So just how big is the self-proclaimed ‘biggest sporting event on the planet’? The statistics are impressive: the Games will host 10,500 athletes from 206 countries, competing in a total of 42 sports at 32 venues. Perhaps most importantly for the travel industry, up to 7.5 million tickets are being issued to spectators from all over the world.

Big numbers then, but encouragingly, John Grant, senior analyst at OAG, a global aviation intelligence company, is not predicting air travel chaos. Grant says: “There was a 12 per cent increase in international air bookings to Brazil for the FIFA soccer World Cup in 2014 [June 12-July 13] compared to the same period in 2013.

While we can’t know every passenger’s exact reasons for travelling, the World Cup would have been a factor in that increase. Nonetheless, there is generally no evidence of major sporting events causing significant increases in air travel. In fact, anecdotal evidence suggests sporting events can actually cause slight declines.

Local people stay home to watch the competition and high hotel prices deter international visitors.” Grant points out, however, that the long-term economic benefits of hosting a major sporting event can lead to air travel increases to that destination in the subsequent years.

One subject that sadly cannot be ignored by visitors to Brazil at present is the threat of the Zika virus. Grant says there is no evidence of the virus leading to a decline in air capacity to Brazil yet but he adds: “The Brazilian market has changed dramatically in the past two years. The economic optimism of 2013 and 2014 has disappeared and international scheduled flights to Brazil are down year-on-year. Average fares in some markets have fallen by up to 30 per cent compared to the previous year. For many airlines, Brazil is a challenging and worrying market.”

Being prepared
Everyone is hoping, nonetheless, to put those worries to one side during the Games. Preparation, as is so often the case, is vital. Alberto Moane of HRG Brazil/Alatur JTB, says: “For a travel management company preparing for an event such as the Olympics, key things are to utilise the expertise you have from working on past events, to build a strong team and to establish solid connections with local suppliers.

“Our team, for example, includes people who have worked on past IOC and FIFA events. The 2014 World Cup gave us a great deal of experience in matters such as handling tickets, planning ground transportation and managing large-scale hospitality programmes.”

The work, therefore, begins long before the Games. Moane continues: “Many of our clients have been travelling to Rio for site inspections since 2014 and we are also in charge of logistics for a number of athletes and team officials who have been attending the test events since July 2015. We have seen a lot of inbound travel prior to the Games.”

When the Olympics finally get underway, HRG will be running hospitality programmes for a number of clients, including sponsors.

Every good travel planner knows, however, that even if business travellers are relaxing in Rio, duty-of-care should never be relaxed at all. “Security is always a key element that requires a lot of attention before and during the Olympics,” says Moane. “Our clients all have their own risk management strategies, and crisis communications and response plans.”

Looking ahead to accommodation during the Games, Moane says: “Costs may be viewed as generally higher than ‘normal’, with availability somewhat difficult to predict as many rooms are being held on packages or allocations. As we get closer to the Games, some of these rooms may be released for open sale and then a more ‘normal’ market will develop. But it is always difficult to predict exactly what will happen in the run-up to the Games.”

He adds that, as an example, the London Olympics of 2012 saw many traditional business visitors avoid the city during July and August but warned against assuming this situation will “necessarily happen again in Rio”.

Business or leisure?
Travellers will converge on Rio from all over the world. Global Business Travel Association (GBTA) economist Ken McGill says: “Most of the travel surrounding the Rio Olympics would be classified as leisure, not business. While there will certainly be some corporate travel associated with sections, such as print and broadcast media, security and hospitality, the bulk of Rio’s visitors will be leisure travellers and sports fans.”

He says this type of operational business travel would constitute 10-15 per cent relative to all Olympic travellers.

Looking at the bigger picture, McGill adds: “One should also consider the business travel that will be displaced or crowded out by the Olympics. With hotel rates carrying huge premiums, ground transportation capacity taxed and restaurants jammed, most companies will surely cancel or, more likely, postpone routine business travel until after the Games.”

McGill says he would certainly be advising business travellers to avoid Rio during the Games if the journey is not essential.

“Hotel rates are likely to be 3-5 times above normal average daily rates [ADRs] for this time of year,” he says. “Rio, and indeed Brazil generally, lacks adequate room supply for normal travel levels. Taxed capacity during the Games will put hotel prices way up, particularly among mid-level and luxury properties. Furthermore, rental cars will be largely unavailable, traffic will be snarled up and public transport will be packed.”

One option for travel planners struggling to find hotel rooms in Rio will be to turn to Airbnb – the Games’ official ‘alternative accommodation services supplier’. Airbnb claims firms that use its services for business travel save on average 30 per cent over traditional accommodation.

Five-star experience
Co Sport, Great Britain’s official authorised ticket reseller for the Rio Olympics, has been preparing for years to ensure the company’s clients enjoy a good experience at the Games.

Working with Jet Set Sports, Co Sport is offering fully customised and managed programmes to clients, building each programme based on the client’s specific interests and typically including five-star hotel accommodation, dedicated transportation and dining options. Corporate clients can use these programmes as, for example, sales incentive packages or as part of internal reward programmes.

With an office in the host city, Co Sport and Jet Set Sports sourced accommodation from two- to five-star hotels several years ahead of the Games. Co Sport has its own hospitality centre for clients and their guests in Rio and is also working with selected restaurants, with which the company has been building relationships for several years, to arrange fine dining events for corporates.

Rio has been preparing for the Olympics since October 2009. The corporate world has been busy lately, too, planning safe and successful trips to the Games. Deals will be conceived, discussed and possibly even signed. If all goes well, there might even be time to watch some sport.

How the other half will live…
Of course, an elite group of visitors to the Rio Olympics will be staying in a unique environment…the Olympic Village itself.

Scott Field, communications director of Team GB, the Great Britain and Northern Ireland Olympic team run by the British Olympic Association (BOA), says: “According to our best estimates, and given that qualification for a number of events is still ongoing [as of March 2016], we will have up to 350 athletes travelling to Rio.

“The team members will arrive at different times dependent on their event programmes. Some athletes will not compete until the final days of the Games and so will not fly out until the Games are underway, whereas other members of the team will need to arrive ahead of the Games to complete their preparations at our camp in Belo Horizonte.

“The rooms in the Olympic Village vary, with a range of single and shared rooms depending on the specific apartment and block. Our research shows the accommodation will be of the high standard appropriate for a modern Olympic Games.”

UK-based Travel Places, an agency that regularly works with sports teams, is supporting Team GB for the travel management process.

The Zika threat
Team GB’s Scott Field says: “The British Olympic Association always has the safety and welfare of our athletes and staff as our utmost priority. As such, we are monitoring the latest information and advice in relation to the Zika virus.”

All travel planners and managers should be similarly vigilant in their duty-of-care to their travellers. At the time of writing, the ongoing Zika outbreak, having first been identified in Brazil in 2015, has been reported in over 30 Caribbean and Latin American countries.

The World Health Organisation states there is no specific treatment or vaccine currently available and says the best form of prevention is protection against mosquito bites, which includes using insect repellent regularly and wearing light-coloured clothing over as much of the body as possible.

Ideally, travellers should seek health advice at least 4-6 weeks before departure. Pregnant women, in particular, are being advised not to travel to Brazil unless absolutely necessary.

Subscribe to the BBT Newsletter

Join the Buying Business Travel newsletter for the latest business travel news.

Thank you for signing up!