1. FORECASTING AUSTRALIA’S TOURISM FUTURE
SATIC Tourism Conference
By Dr Leo Jago
Chief Economist & GM
29 May 2014

2. Presentation Overview
Tourism – the state of play
Tourism – forecasts
Megatrends (CSIRO Futures)
Summary of key tourism drivers

3. Global Tourism Statistics (UNWTO)
International tourism arrivals in 2013 : 1.1 billion
Annual growth of 4% expected to continue
Predicted arrivals for 2030 of 1.8 billion
Tourism export earnings in 2012 : USD 1.3 trillion
Accounted for 9% global GDP in 2012
Generated 9% of total employment in 2012

4. Tourism’s Economic Significance (2012-13)
Australia
South Australia
Direct tourism GDP
$24.2 billion
(2.8% of total GDP)
$2.2 billion
(2.3% of total GDP)
Tourism exports
$27 billion
(8.9% of total exports)
$1.1 billion
(4% of total exports)
Direct employment
543,600 jobs
(4.7% of total employment)
31,000 jobs
(3.8% of total employment)
Businesses
280,083

5. Australian Tourism Figures (YE Dec 2013)
Visitors (millions)
Nights (millions)
Spend (billions)
International
5.9
216.7
$28.9
Domestic Overnight
75.8
282.7
$51.5
Domestic Day Trip
164.3 -
$18.3
Total
$98.7

6. Inbound Versus Outbound Visitors

7. South Australian Tourism Figures (YE Dec 2013)
Visitors (millions)
Nights (millions)
Spend (billions)
International
0.4
10.5
0.7*
Domestic Overnight
5.2
19.5
$3.2
Domestic Day Trip
11.0 -
$1.2
Total
$5.1*
* Excludes pre-paid expenses

8. Visitor Nights in South Australia

9. Visitor Spend in South Australia

10. International Arrivals to Australia in 2013

11. Source of International Visitors to South Australia

12. Source of International Visitors
Nationality
South Australia %
Australia
United Kingdom
17.2*
10.5
New Zealand
18.4*
USA
8.6
8.0
Germany
7.8*
2.8
China
7.2
11.3*
Malaysia
4.2
France
4.1*
1.8
Canada
3.5
2.1
Italy
3.1
1.1

13. International Visitor Activities

14. International Visitor Dispersal
Nights outside capital cities, GC & TNQ
YE December 2013
Nationality
Visitors %
Nights
China 9 6
Other Asia 17 13
North America 36 25
Europe 48
Total 27 18

15. Source of Interstate Visitors to South Australia
Origin %
Victoria
42.6
NSW
26.6
Queensland
13.2
Western Australia
8.3
Northern Territory
5.0
ACT
2.2
Tasmania
1.9

16. Purpose of Visiting South Australia (All Visitors)

17. Increasing Visitors to South Australia from UK, US & Europe
53% could name a location in SA unprompted
Adelaide 49%
Kangaroo Island 10%
Barossa 5%
Respondents believed SA:
Has unique attractions
Just seems too far away
Is vast and empty compared to other places in Australia

18. Main Reason for not Selecting South Australia in Planning the Trip
Not enough time in trip to include
Too expensive
Other destinations more appealing
Plan to visit in the future

19. China Forecast to Remain Australia’s Top Expenditure Market

20. Key Influences on Chinese Visitor Satisfaction
Attractions, especially nature based
Value for money
Good shopping
Good quality food, Western and Chinese
Chinese language services
Source: Tourism Research Australia’s: Chinese Visitor Satisfaction Research January 2014
The key drivers in creating a positive travel experience for the Chinese visitor are attractions, value for money, good shopping and having a nature-based experience that is better than expected. Strategies should be developed to maintain and enhance these key elements of a trip to Australia.
Nature based experiences
Australia’s natural environment is an essential part of the Chinese visitor experience. Not only did 65% hope to have a nature-based experience and 26% a wildlife experience, 44% cited Australia’s unspoilt natural environment as the single best feature of Australia. Australia’s good natural environment and livability was also the main reason given for recommending Australia to others (89%).
Value for Money
The IVS reports Chinese visitors to South Australia were 1.12 times more likely to be dissatisfied with Cost / value for money / exchange rate / expensive compared to the Rest of Australia.
35% for SA versus 31% for Rest of Australia.
Good shopping
Satisfaction with shopping had a positive association with overall visitor satisfaction with Australia and a greater likelihood to recommend Australia as a holiday destination
Good quality Western and Chinese food
The Chinese visitor generally expects to consume Chinese food while in Australia, however, the quality of the Chinese food (or for group-tour visitors, the choice of restaurants) needs to improve. Importantly, when visitors rate the quality of Chinese food highly, trip outcomes are improved.
Chinese language barriers
Overall, visitors dissatisfied with the availability of Chinese language services were less likely to have a trip better than expected (see Appendix Figure 3), or to recommend
10 . Australia as a holiday destination (see Appendix Figure 5). The language barrier was also one of the main reasons cited by visitors for not recommending Australia (37%).

21. South Australia has what China Wants
World class beauty and natural environments
A safe and secure destination
Good food, wine, local cuisine and produce
Friendly and open citizens, hospitality
Native or cultural heritage
Kangaroo Island, whale/dolphin watching
Source: Tourism Australia’s: Understanding the Chinese Consumer June 2013
22% indicated that Kangaroo Island was a most appealing destination behind Sydney, Gold Coast, Tropical North Queensland and Melbourne.
The most appealing Australian destinations included:
Australian beaches
Aussie coastal lifestyle
The Australian wildlife
Rainforests etc
Their preferred sources for planning a holiday to Australia were:
74% general internet source
66% travel advice websites
63% Offline travel agent
39% online travel agent
The Asia Marketing Fund (AMF) announced by the Australian Government in the budget, provides A$48.5 million over four years to promote Australia to Asia.
In China, Tourism Australia targets affluent adults with an independent travel mindset who want to explore and experience local culture.

22. Tools to Help You www.tra.gov.au Asia Focus
Tourism Research Australia, through the AMF have provided a number of Action Plans to aid tourism operators in developing their Asia market strategies.

23. Mega-trends Impacting Tourism Over Next 20 Years (Prepared by CSIRO Futures for Queensland)

24. 1. The Orient Express
The generation of wealth is moving east

25. 1. The Orient Express
Over 1 billion people in Asia will transition out of poverty into the middle income bracket in coming decades
China will dominate this trend
Chinese tourists prefer historical & cultural sites rather than just natural scenery
Like to incorporate visits to museum, art shows or watch sport during holiday
Countries throughout Asia are investing heavily in tourism so there is much competition

26. 2. A Natural Advantage Impact of climate change
Australia has world class natural assets
Nature is still Australia’s drawcard with tourists
Increased urbanisation is likely to increase the desire for nature

27. 3. Great Expectations Moving upwards through Maslow’s Hierarchy
As incomes rise, people move from consuming materials to consuming experiences
An increasing desire for authentic experiences
The tourist doesn’t want to be a tourist
VFR is important especially for domestic tourism & forecast to rise

28. 4. Bolts From The Blue Tourism is highly sensitive to extreme events
Climate change brings more extreme weather events
Increased human mobility is elevating the risk of infectious diseases

29. 4. Bolts From The Blue
Increased uncertainty increases the popularity of domestic holidays
Australia is a relatively safe tourist destination
Australia’s safety ranked more highly by past visitors

30. 5. Digital Whispers Internet usage continues to grow
Increased internet usage on smartphones
IT will continue to change how tourists access and use information
The changing role of the travel agent
Greater information flows between travellers

31. 5. Digital Whispers The popularity of user-generated content in travel
More bookings are made online
Virtual experiences are not replacing actual experiences yet
A virtual experience may increase the intention to visit
Despite IT, there is the expectation for face-to-face interaction
For some there is too much IT and people want to disconnect

32. 6. On The Move Trade leads to travel
Global trade to increase by nearly 75% by 2025
Strong trading ties with Asia
Growth in multi-purpose trips
Education exports (22% of students in 2009)
Rise of medical tourism

33. 6. On The Move Aviation access is critical
Air ticket prices also important
The world’s citizens are becoming more mobile
High speed rail more popular
Cruise ships on the rise

34. 7. The Lucky Country Australia rode the GFC better than most
Overseas holidays getting cheaper
Outbound tourism for Australians is on the rise
Australian tourism seen to be high cost globally
Lack of investment in domestic tourism product could hold back local potential
Ageing population means Baby Boomers form a key market

35. Defining Characteristics Arising From Merging of the Megatrends
Safe and secure
Clean
Green
Friendly and authentic
Value
South Australia performs well on most of these dimensions

36. Domestic Tourism – Key Drivers
Safety and security
Value for money
Picturesque natural environments
Key attractions
Natural landmarks
Heritage sites
Historical landmarks
Food and wine experiences
Especially in natural settings

37. Domestic Tourism Issues
Outbound tourism growing strongly
Aspirational
Broader product range
Better value
Lack of awareness of Australian product
Domestic travel helps unite families
Offering must suit all family members
VFR continues to grow
Weekend breaks continue to be popular
Challenge is to move them outside peak periods

38. BUT South Australia Great natural environments
Wide range of natural and heritage attractions
Excellent food and wine
Good driving location
BUT
Low levels of awareness
Limited access

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