Future Tourism: Research shows investment should be spent on smaller number of destinations

Exclusive research has shown the way forward for the Queensland’s tourism industry, with fears the current model is diluting the state’s impact with overseas visitors.

QUEENSLAND could boost its bang for tourism buck by targeting efforts on attracting high-spending international tourists to a handful of key hubs around the state, according to new analysis.

The Sunshine State is currently divided into 11 destination regions, with a network of 13 regional tourism organisations, each promoting their patch of paradise.

But exclusive research for The Courier-Mail by professional services firm PwC casts doubt on whether that is the most effective model to target a vast lucrative potential overseas market, with a risk of diluting the overall impact and competing against each other.

Drew Curtis, director of clients and markets for PwC, argues that a better approach might be to concentrate effort and investment on a smaller number of areas with proven appeal to international tourists — and says the rest of the state would inevitably benefit from the spin-off lift.

“A rising tide floats all boats, but we’ve been focused building more boats instead of ensuring the tide reaches as high as possible,” he said.

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Tourism Industry Development Minister Kate Jones says she is open to new approaches.

Analysis by PwC shows that $48 million of Tourism and Events Queensland-funded promotion — including $7 million a year to the 13 RTOs delivers $6 billion in spending by 2.8 million international visitors — $2,126 each.

The $10.3 billion return from Tourism New Zealand’s $108.7 million investment is $2,677 per visitor and Destination British Columbia gets $3,192 from each of its 5.7 million tourists — generating $18.3 billion from a $53.1 million outlay

Overseas tourists to the Sunshine State comprise just over 10 per cent of the total visitors. But they accounted for a quarter of the $24.3 billion tourism spend.

“So it’s the most productive market to tap into,” Mr Curtis said. “The clear market opportunity is overseas.”

But there are big differences in the spending habits of various nationalities.

China overtook New Zealand as the biggest source of international visitors to Queensland last year. Each of the 502,000 Chinese visitors forked out an average $2,862 here.

That’s nearly twice the average $1,197 expenditure of the 483,000 Kiwis who came, partly because many of those crossing the Tasman are visiting and staying with family and friends.

Koreans are the biggest individual spenders, splashing an average $3051 each, followed by Taiwanese tourists at $2,937.

Mr Curtis says while the proportion of foreign visitors is comparable with other states in Australia, it’s a small number and a tiny fraction of the “vast’ potential market.

“There are 120 million passport-holders in China, so if 500,000 visited Queensland last year, that means there are 119.5 million who didn’t.

Chinese visitors Zhou Danting with Zhang Yipan at Tangalooma. Picture: Image AAP/Steve Pohlner

“Even if you triple the number coming here, you are barely scratching the surface.”

While it was important not to neglect domestic tourist, who comprise 90 per cent of visitors and three-quarters of economic contribution, it was a mature market and the emphasis should be on maintaining numbers and maximising their expenditure through more and improved experiences and products.

“But you don’t get Queensland to the number one tourism state by getting more people to come from Sydney. You do it by getting more people from China.”

Several regions around the state already attract higher proportions of international visitors — led by Tropical North Queensland with 29 per cent, Whitsundays 26 per cent, Gold Coast 22 per cent and Brisbane 16 per cent.

The tropical north also has the highest spend per tourist at $1,179 It is followed by the Whitsundays — even though it attracts the smallest number of visitors overall among the 11 regions — then the Gold Coast and Brisbane, which was lowered by the fact half

Mr Curtis said those four presented as natural tourism precincts to be developed as magnets for lucrative overseas tourists, and launch pads to broader regions around them.

The challenge then was to understand your target markets, ensure the key hubs had the type and level of accommodation, experiences and services they wanted and promoting strongly under a single clear brand promotion message.

“The way the industry has grown historically, particularly in the regions, has been very organic. Investment tends to be spread over the 13 RTOS, which raises the question of whether it can be optimised.”

Chinese tourists Jill You and Qi Zhang at Sirromet Winery. Picture: AAP Image/David Clark

The minister said: “We’ve had a lot of conversations about how we can improve the network and I’m open to new approaches if it can deliver better bang for buck for Queensland taxpayers.

“I’m willing to look at all options on the table.

“There is no doubt that tourism is an industry where if you back your winners, that helps you deliver a greater piece of the market share which helps all businesses in the industry. That’s definitely my view.”

TEQ chief executive said the Bundaberg, Gladstone and Capricorn Coast RTO working together to promote together under the “Southern Great Barrier Reef” was a great example of collaboration.

Visit Sunshine Coast CEO Simon Latchford, who chairs the RTO network, said: “It’s really important we don’t have two or three powerhouses and leave the rest behind.

“Queensland’s very asset is its diversity. Some of the most captivating and authentic experiences are in far-flung parts.”

It was for the Government and TEQ to decide the best model. “It might be consolidation into five super RTOs or 13 disparate ones, I don’t know.”

But it was critical that attractions that would appeal to the world were sustained and promoted throughout the state and that the industry was equipped to respond to the rapidly-changing tastes of global consumers.

Ideas for helping RTOs become more self-sustaining such as giving them rights to manage local national tours would help.

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High-value travellers hold key to success

SHOW us the money — that’s the clarion call from Tourism and Events Queensland as they try to lure big-spending visitors to the Sunshine State.

Chief executive officer Leanne Coddington says the agency’s strategy is not simply about attracting as many people here as possible, but getting those who deliver the best economic benefit.

“It can’t just be a numbers game because if it is we won’t be sustainable and people will become less interested in going to see experiences if they think they are going to be there with thousands of other people,” she said.

“Overall, spend is the thing for me. That’s the key target that keeps us awake at night. We are really focused on delivering overnight expenditure because if we get that right, that will deliver profitability for our industry.”

TEQ’s target is what they call “high-value travellers”.

For domestic visitors, that is defined as those who spend at least $300 per night or $2000 per trip. The average domestic spend is $192.80.

“When we talk about high-value travellers, they are not necessarily high-end.

“A high-value traveller is someone prepared to open their wallet and spend and immerse themselves in the destination. They could be staying at a caravan park, they could be staying at a five-star resort.”

They have identified four million interstate visitors and 1.1 million Queenslanders as potential high-value tourists.

They are affluent families, mostly from Sydney and Melbourne, and lower-income Queensland families, who holiday within the state.

Eric Yu, business development manager (China) at Sirromet Wines, said China’s middle class was not only growing, but those looking to travel were younger, confident and more adventurous.

“The language barrier is going as well, many of them speak English,’’ Mr Yu said.

“And they have family and friends here, so they’re much more comfortable travelling,” he said.