$1.5 Billion-dollar Youth Tourism Industry Under Threat

YHA New Zealand is concerned about Tourism Minister Stuart Nash’s focus on high-value tourism when borders reopen.

The youth market represented almost a quarter (450,000 people) of all annual holiday arrivals up until COVID-19. This is a significant economic driver for the country that generates $1.5 billion in foreign exchange earnings – higher than any other age demographic.

"Focusing on high-value tourism discounts the significance of the youth market to the visitor economy in New Zealand. It also disregards that a large section of the tourism industry is geared towards a long-established position for Aotearoa New Zealand as a vibrant country for young and active visitors looking for adventure, culture and nature," explained Mark Wells, YHA Chief Executive.

"This has proven to be a successful strategy for our country and has supported strong industry growth and, with that, economic benefit over the past 20 years."

YHA New Zealand agrees it is appropriate to consider a re-set for tourism but contend that Government should embrace the key elements of the country’s strong historical tourism performance to develop future strategies. This includes continuing to target and invest in the youth market as part of an overall destination marketing strategy.

Wells is asking the incoming Minister to develop a more rounded insight into the sector as part of shaping the Government’s position on this key economic driver.

"The youth segment stays longer, visits more destinations, is more satisfied by their visit and takes part in more activities while they are here … and often return when they are older."

Focusing on this market also achieves broad appeal to older demographics, whereas targeting older demographics is less likely to appeal to the younger market. By concentrating on high-value experiences that target middle-aged travellers we risk eroding the well-established positioning of New Zealand. This will limit the appeal to the youth market, but also the broader target as well. The older demographic is less likely to take part in extreme versions of experiences on offer.

"The adventurous and innovative spirit that these experiences represent should remain a draw-card and continue to define New Zealand."

Youth market tourism facts:

  • Generation Z (those born between 1995-2015) make up 30 percent of the international travel market and is the largest single demographic with considerable purchasing power and influence.
  • Youth visit more regions than any other age group and their $1.5 billion spend is more widely spread throughout the country.
  • The youth market, particularly Generation Z, has its own specific media consumption and values that benefit from specific attention.
  • Youth word-of-mouth is a significant contributor to the ongoing long-term positioning of New Zealand. This segment has a higher satisfaction level when experiencing New Zealand, which supports positive word of mouth.
  • Working holiday visas are important ‘products’ that drive youth arrivals as well as short-term support of the tourism industry, covering seasonal demands across regional areas. This enables business growth, especially within regional economies.
  • The international study market contributes significant parallel revenues that support leisure arrivals as well as additional visitation from friends and family.