Michelin Plays its Travel ‘Trump Card’

The Michelin Group is first and foremost a tyre maker – 99 per cent of its business is directly tyre related. Yet the residual proportion of Group activities not centred upon the black, rubbery rings – the company’s maps and guides, ViaMichelin and Michelin Lifestyle – should by no means be viewed as just a sideshow, a therapeutic diversion from the serious business of producing tyres. In the words of Michelin managing partner Jean-Dominique Senard, “the one per cent is crucial to the 99 per cent of sales. It gives us half a billion contacts through our website clicks, and tens of millions of maps and guides are sold.

“They are our trump card,” Senard adds. “They provide us with a useful service and encourage people to frequent the brand more often. Car drivers don’t change their tyres every year, but guides and maps are something that are often used. People must keep the Michelin brand in mind even when they don’t need to change their tyres.” This strategy has, the Michelin managing partner notes, been central to Michelin’s success since the dawn of the twentieth century: In 1900, Michelin Group founders Édouard and André Michelin observed that France contained a total of 2,897 registered vehicles, giving them a potential market of only some 12,000 tyres. The brothers therefore decided to elevate the young brand’s profile by producing a free guide containing information vital to motorists in those pioneering days, and distributed some 36,000 copies of their first edition.

Over the course of the century the Guides developed into something of a bible for travellers and gourmets, and Michelin has continued to move with the times. In March 2010 Mr. Senard announced the latest evolution of what has proven to be a highly effective driver of tyre sales. “In 2000 the Group met a watershed when Michelin Lifestyle was put together. In 2000, Édouard Michelin’s ambition was that ‘ViaMichelin would be one of the leaders in providing travellers help in Europe’. We have done that. In 2010, we are going a step further.” This next step involves an intermeshing of Michelin’s print and digital travel products to provide users access to the company’s full range of tourist information. “In other words, ViaMichelin and the Michelin Green Guides will together open the door to Michelin’s accumulated acquired knowledge, a database of tourist information and services more than a hundred years in the making,” explains Senard.

The decision to hone the Green Guides and ViaMichelin into a more coordinated tool for travellers was made after listening to what customers wanted and needed. “We surveyed 14,000 people – a huge sample – over two years, and we observed a trend,” Christian Delhaye, director of Michelin Maps & Guides, explains. “A lot of people these days want to take short breaks, such as long weekends. Catering to this creates for us a demanding task, as half a day can represent a quarter of the stay.

“Travellers today have extremely diversified needs that are sometimes in conflict with each other – cheap, expensive, cultural, practical, for example,” Delhaye continues. “We need to put these requirements all in the one guide. People don’t want specialised segmented guides. This segmentation no longer exists, which explains the success of the Green Guide.” This success is, incidentally, confirmed by sales figures: While on average tourist guide sales grow one to two per cent every year (and some sales were down 1.5 per cent in the recession year 2009), sales of the Green Guide are increasing three per cent per annum.

 “We also found that 98 per cent of travellers prepare for a journey on the internet, and 100 per cent use a paper guide when underway,” Delhaye adds. “This showed us there is no battle of guide versus internet, and therefore we have created an offer that combines paper and digital.” Senard comments that “the number of paper guides reached a peak last year, as did our online services. People tell us they want both.”

Online content has been upgraded through the addition of Travel.ViaMichelin.com to the ViaMichelin website. This service is available in English, French, German, Italian and Spanish, and before the end of 2010 will cover 90 countries and include 100,000 bookable hotels, 57,000 restaurants and 36,000 tourist sites. “To put it simply, we’re going to provide access to the content of all our Michelin Guide collection,” says Jean-Dominique Senard, noting that Travel.ViaMichelin.com is the online equivalent of 350 Michelin tourist guides. This online information is available free of charge – as Alain Cuq, CEO of ViaMichelin explains, it is “up to us to find compensation for our work.”

Cuq shares that the established ViaMichelin site, which is available in eight European languages, attracts 20 million visitors a month on average. “ViaMichelin’s internet success has been astronomical,” he says. “End to end, all the journeys completed every day on the basis of information from ViaMichelin would equal three times the distance of going to the sun. To have this wealth of information has required a lot of spadework, as you can imagine.” In addition to this abundance of information, visitors to the upgraded site will also be able to book plane or train tickets, rent a car or reserve a hotel room through the site, and prepare their own personalised, printable travel book that functions similar to the shopping cart on an e-commerce site.

The print side of things is represented by a bigger and better Michelin Green Guide range. The first noticeable change is the book’s physical dimensions; a less vertical format has been adopted to make the guides a better fit for carry bags. Alphabetical listings have also been replaced with a new presentation based upon geographic regions, and hotels and other attractions are classified according to price. Twenty new English language titles join the Green Guide collection and are scheduled for an April release, and the UK is covered through a Great Britain edition and one specifically focusing on London.

This year the Green Guide (in all languages) grows to cover 50 countries, and the number of titles – national, regional, city, thematic and weekend guides – is planned to increase six-fold by the end of 2012. New titles in the French language range include China & Hong Kong, Thailand and Vietnam. Editions covering Taiwan and Korea are also in development. Their introduction represents a new focus for Michelin. “Our roadmap is to move away from a European offer to an international one,” Senard reports. “We want to focus on these Asian countries.”

Senard did not disclose the cost involved in developing this latest Michelin’s project, however he noted that “sums are quite low when you think about Michelin Group investment.” The improved online product and Green Guides continue to be complemented by Michelin’s mobile phone services, which include access to Michelin Guide information and, in France, real-time traffic reports. “Our electronic maps for iPhone and Nokia and the Michelin Lifestyle products access a younger customer base,” states Senard. “Together, these services continue the genius that started when André and Édouard Michelin created the red covered guide. The creation of the Michelin France guide from a tyre manufacturer was a founding component of the Michelin brand and has massively supported the company’s tyre sales.

“Michelin is today a world brand,” reflects Senard in conclusion. “At least seven out of ten people in our host countries recognise the Michelin Man, he is iconic. The Guide is serenely sailing into its second century of existence. The new service provides customers with a resource that allows them to plan every aspect of their journey. When they set off on this journey, it will most likely be in a car – and hopefully it will be one fitted with Michelin tyres.”