Club Med seeks a new cure - Departure - Brief Article

Chief Executive, The, March, 2003 by Sonja Sherwood

IN HIS 1949 NOVEL The Sheltering Sky, Paul Bowles peered into the sun of his adopted Moroccan homeland and asked, "What's the difference between a tourist and a traveler?"

That same question undid fellow Moroccan Philippe Bourguignon, 54, who until Dec. 16 was the head of Paris-based Club Mediterranee, France's post-war celebration of pan-Euro conviviality turned tired swinger's scene. Bourguignon crafted an ambitious program to rejuvenate the resort brand, but ultimately couldn't convince his shareholders to foot the bill.

It now falls to his erstwhile general manager, 46-year-old Henri Giscard D'Estaing, to update Club Med's dated image and to attract new, younger travelers--many of whom prefer genuine local color to sipping colorful cocktails under a faux thatched hut.

Bourguignon, who is credited with rescuing Euro Disney in the mid-'90s, contemporized Club Med, offering vacationers the authentic, individualistic experience they crave, such as backpacker-type excursions into native communities.

But his diversification spree pushed the brand into leisure parks, sports clubs and singles beach parties just as the September 11 travel lull took hold.

The Agnelli family, which controls 33 percent of Club Med's voting rights, balked at ponying up for Bourguignon's ideas after the company reported a $63.5 million loss in fiscal 2002. "His ambitions may have been in one area, but their ambitions were in another," comments John Vanderslice, president and CEO of Club Med's North American operations. Within days after being appointed the new CEO, D'Estaing announced that he would freeze any new investments in diversification.