Visitors are streaming into Asia/Pacific destinations, some motivated by terrorism in Europe and Trumpism in America. Vacation spots from New Zealand and Australia to Thailand and Japan are struggling to keep up with burgeoning demand. The hunt is on for visitor accommodation, trained staff to run that visitor accommodation, and in some extreme cases like Queenstown, even accommodation for the staff who run the visitor accommodation. From a hotelier’s perspective, let the good times roll.
They say there are bold pilots and there are old pilots, but there are few old bold pilots. The same is true of hoteliers. Our sector has about a decade long business cycle by historical average. Will that continue, and if so, what should a hotelier be doing now to reach old age?
Auckland and east coast Australia’s housing bubble is a clear and present danger to an industry whose visitors are mostly Kiwis and Aussies. Building a broader market portfolio reduces risk.
The current boom is an opportunity to invest in developing new markets. Selective targeting of development markets can improve seasonality, regional spread, and lift value of visitors. Our industry leaders are doing a great job of pushing on these new frontiers. Let’s back them up.
Could India be the next China? It will soon overtake China to become the world’s largest country, as a fast growing economy, English speaking FIT travelers who love cricket and Bollywood movies filmed here, and like to travel in May. Tourism New Zealand is getting good return on its increased investment there. New air links to New Zealand from around the Pacific rim are circling to land en masse this summer, but a non-stop route from the subcontinent is nowhere in sight. Airbus boasts its new long-range aircraft would comfortably overfly the subcontinent from a New Zealand departure.
ASEAN presents a one billion person market with rapid economic growth. That is, ASEAN is another China or another India. Many ASEAN countries have travel peaks at quiet times for New Zealand plant. Air routes from ASEAN to New Zealand are growing rapidly. Japan is the only high-income nation, other than ASEAN-member Singapore, to introduce a relaxed visa-on-arrival regime for ASEAN. ASEAN people are falling over themselves to visit the land of the rising sun, and most of them go home.
Current strategies by industry leaders to improve seasonality are to be applauded. This is the third time in three decades that we have prioritised seasonality improvement. At the same place in the business cycle each time – when summer is full. When we reach the downside of the business cycle, as an industry we have a tendency to forget about seasonality, so our markets do too. This means that the next time seasonality becomes a burning issue, we make a standing start. Millions flock from tropical Asian markets to Japan for something as simple and low cost as looking at autumn leaves, because that has become an integral and enduring part of the Japanese proposition and brand. What can we do to remind ourselves in five years’ time to maintain the seasonality push, even though summer may not be full? Perhaps bury this note in a time-capsule for scheduled re-reading?
Tony Everitt, Tourism Consultant
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