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Cyprus

CTO marketing strategy slammed

Choppy waters: the CTO has repeatedly come under fire for its policies

By Constantinos Psillides

Auditor General Odysseas Michaelides has slammed the Cyprus Tourism Organisation (CTO) for its advertising practises in a report leaked on Tuesday.

The report’s validity was confirmed by a source within the Auditor General’s office, who stressed though that this is only a first draft. “The office sent the report on Monday, asking the CTO for their comments on the issues raised. The complete, finalised report will be issued sometime in October, after the office receives CTO’s official comments. They were given until October 2 to respond,” the source said.

According to the leaked report, the CTO board has on a number of occasions approved an advertising budget without following proper procedure. CTO officials were criticised for making haste to spend the advertising budget before the fiscal year expires, despite not giving a reason on why that money wasn’t spent before or why it should be spent now.

The Auditor General has repeatedly criticised the CTO’s marketing strategies in the past, remarking on their lack of an efficient and comprehensive strategy.

The report specifically notes that in November 2013 the CTO board hastily approved a €492,544 advertising campaign with CNN International and a €250,000 campaign with Euronews without first inviting tenders. The CTO board argued that the matter was urgent because the end of the year was coming up and the money would be lost.

“The procedure followed deviates from the legal provisions governing public contracts, since in under no circumstance the board was justified for not holding a tender. Beyond this serious issue, the proper procedure for bypassing the tender process wasn’t followed, since the board should have referred its decision to the competent body, the Tender Committee.

Also not observed was the board’s obligation to invite representatives from the Attorney General’s, the Auditor General’s and the Accountant General’s offices to be present at the meeting,” the auditor general wrote.

The report underlines that these decisions constitute “grave violations” and that the CTO officials involved could face disciplinary action.

Michaelides also scolded CTO on their decision to make a deal for an ad campaign with Yahoo and Google – €400,000 and €200,000 respectively – as well as a €220,000 deal with Russian Yandex and a €80,000 deal with UK based Butterflies Media. Michaelides notes that once again the decisions were made without first inviting tenders, near the end of the year.

The 33-page report concludes that CTO is a “problematic” organisation when it comes to managing funds.

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