This is a business management assignment, to research and make report on Australian Tourism, aims to give overview how much tourism impacts the south Australia. It details the relationship between Australian and international tourism.
Australian Tourism Report with Business impact
South Australia Tourism:
South Australia is one of the most sought after tourism destinations of the world and one of the main contributors of the economy in terms of tourism in the country. It was voted as one of the most liveable cities in the world. It is also known as the wine and the seafood capital of the country. The South Australian tourism focusses on the experiential vacations where in the tourists have a lot of things on offer in terms of different experiences and has been positioning them to be one of the destinations that have to be visited again. One of the main attractions in the region is the festival that attracts huge crowds both from within the country as well as out of it. Some of the most common festivals that attract huge crowds are Santos Tour down Under, Adelaide Festival and Adelaide Fringe. Known as the wine capital of the country, it produces world class wine and more than 10 varieties of wine is produced within the region and one of the most important thing is that various regions are well connected by means of road. The region is touted to be one of the fastest growing tourist destinations in terms of the expenditure by the visitors in the past decade.
International Tourism Industry:
Travel and Tourism has grown from strength to strength in terms of the revenue contribution to the economy and is one of the major industries that provide jobs to the customers. World travel & Tourism council has predicted a growth of the industry to generate 1.8 trillion USD in the year 2015 and these also generated jobs close to 350 million. One of the key developments has been that the South Asian countries started contributing a larger chunk to the tourism industry globally as China surpassed US and Germany in terms of the spending on tourism in the past two years. It is encouraging to see that when there are other industries that are still not recovered from the global slowdown, tourism is expected to grow steadily at the pace of around 4% year on year and contribute a sizable chunk to the growth story of many countries.
The Service Offering:
South Australia offers an assortment of travel options to the customers who include various wine producing areas like Barossa and Clare Valley which is the habitat for Kangaroos. South Australia positions itself as the destination that offers a lot of experiences to the visitors. In line with the tourism Australia campaigns, they offer a good combination of experiences and wonders of the nature. The value proposition that they offer to the customers include an experiential trip to the customers to be enjoyed at a low cost. One of the most important developments that we have seen over the years is that they have tried to pitch in with other South Asian nations in offering value tourism to their visitors as there is a huge upsurge in the number of travellers who belong to the middle class and hence it is imperative for them to pitch in and offer travel options to that particular category who has shown an increased affiliation to the South Asian destinations because of low cost. One of the differentiating factors for South Australia tourism that they have tried to portray to their target segment is that the vacation is to be combined with a lot of experiences in terms of activities that are offered to the visitors thus making them memorable. One of the main aims to get less report Tourism Australia, it results in repeat visitors and get a positive recommendation from their visitors on which they can build conversations in the online communities which are a main mode of communication for Tourism Australia these days (Buhalis, 2003).
Here we would try and analyse the market forces both internal and external that play out in the growth of the South Australian tourism industry. We would be looking at the areas of strength that Australian tourism will have to build on create a difference as compared to that of other destinations, the weaknesses that they will have to address in the near future to ensure that they move ahead in the race, the opportunities that they will have to grab on so as to create the difference among themselves and other market players and also the threats that they need to be wary of.
One of the main strength it has is that the destination is unique and is known for the experiential travel and hence there are so many travellers who would opt for the region mainly because of the unique appeal that it has. This also has resulted in the travellers spending a lot of money as the average spend during a visit in South Australia is 1.3 times the international average which is a great thing to have. There are several unique attractions in the region that makes it one of the most sought after tourist destination (Gary, 1998). The next major strength is that the AUD has been on the weak side as compared to that of many other currencies and this has resulted in more people choosing Australia as a tourist destination as they get much more value while visiting the country as they have a lot more to spend. The signs are that this is going to continue in the next two years at least giving the tourism industry a hope that they should focus more on this. Another major strength that they have leveraged upon is the advent of digital marketing to create awareness amongst the global audience about the uniqueness of the place and hence would drive more revenues through a relatively inexpensive digital media campaign. Many locals are also involved in reviewing the place and hence promoting the same.
One of the main weakness is that European countries which are the largest spenders on tourism is in deep recession for a while now and have cut down drastically on the volume spends on travel and tourism and this is more likely to affect the tourism in the region. Similar trends back home also doesn’t throw up a bright picture as the economic recovery is slow and thus the spends on tourism domestically is also bound to be on a decline due to reduced customer interest. Another major weakness is that the business and corporate travel is also on a low in the last few quarters and the industry experts are of the opinion that it is not going to improve drastically at least in the coming few quarters (Smith, 2003)
One of the main opportunities that they have is a close proximity to Asia which is one of the emerging markets in terms of spending on tourism and this would in turn drive more visitors into the region if they manage to create the awareness. Another major opportunity is that the regulations by the government in terms of travel have softened and this can be leveraged to get in more people to visit the region. Aviation sector has been supporting the tourism with its low airfares and the competition in the market has pushed down the airfares thus making it more affordable to a larger set of people which can be leveraged upon. Another major opportunity that they have is to tie up with some major companies who work on loyalty point models which could be used in converting it to use them during the travel in various activities and such cross industry marketing can actually help South Australia tourism as it is seen that in most of the cases it spurs demand (Jennings, 2008).
The main threat that the industry faces is the weak economic recovery prospects of the Euro Zone creating a huge dent in their traditional target market; also the corporate travel business is not growing s expected in lines with the economic recovery domestically. These are the two traditional pockets that the region depends on and a loss in business from these segments mean that they will have to compensate the same from other areas which would be new markets for them and would face the competition from the existing players. Another major threat that they face is in terms of the aviation capacity limits that is imposed which limits the number of seats and hence even though the airline carriers are offering a low cost to the customers. It still becomes difficult to leverage on the potential opportunity that they have because of the restrictions imposed.
The target market that South Australian tourism is focussing on would be experience seekers who would just not travel and visit places but instead involve in some activities that would benefit the industry in terms of spending. Thus the main focus that they have is to promote not just tourism in the region but also a host of other facilities that the visitors can avail and involve in. Another major target market is Asian countries which have shown an above average growth as compared to the global average and the spending on travel and tourism in these markets is on a rise as compared to that of many other economies. They should look at promoting tourism extensively in these regions as there is huge potential in emerging nations like China and India which is spending good amount of money on travel and tourism. Another major advantage that the region has is that there are a variety of activities that the visitors can engage in thus making it attractive for all sets of audiences without any age group.
South Australia tourism has positioned itself based on the Tourism Australia’s core philosophy of experiential travel. The positioning statement that they have is that “You just don’t visit Australia, you live it”. This is one of the unique places that they have in the tourism market and this has lent the benefit of grabbing the first mover advantage in the industry in terms of experiential travel and hence created a position for themselves in the market (Porter, 2001)
Product: The destination offering that they have is unique in terms of the various activities that the visitors can engage themselves in and it can be said that they place a lot of emphasis in promoting the same by means of various festivals etc. This is beneficial for them as the average spending in case of a tour trip to the country yields about 1.5 times the revenue as compared to an average tour trip and it is these experiences that they offer create the difference. There are a lot of natural and man-made structures that make the place unique and one of the distinctions it has is that it is the wine capital of the country thus offering the visitors a chance to relish the beauty of the wine yards and taste around 16 varieties of wine. Some of the main attractions that the region has are Barossa, Kangaroo Island, rundle Street and Glenling. The place is also known for its various food options that the visitors can try and these different culinary options only add to the experience part in the tour.
Place: The main means of tourist booking happens by means of travel agents like Cox and kings etc. wherein they have tie ups with almost all the major travel partners. They have also made effective use of the digital media in promoting tourism and this has become one of the means by which the bookings are taking place. They have ensured that they have tie ups with various travel agencies both domestically and also in all their important markets to promote tourism in the region. They also have set up helplines to assist the travellers on various issues.
Price: This is the total spend of a visitor during the travel. South Australian tourism council has positioned itself as an inexpensive travel option in an attempt to challenge the emerging dominance of many South Asian countries and the weak AUD is assisting the cause. The main strategy is getting in the visitors to the region and by the sheer uniqueness of the variety of experiences; they hope that they would spend additional in experiencing them. Reduction in the travel fares by the airline carriers and the hotel industry also has contributed to making it an affordable tourist destination for many (Brotherton, 2008).
Promotion: They are engaged in promotion through different channels and the main focus is on the digital and the print media mainly because of the reach that it provides. There are several promotional campaigns that they have set up in partnership with their travel partners and the core essence of all the messages is that of the experiential travel which is in line with the communication strategy of Tourism Australia. They also offer various tax sops for movies to be shot in the region in an attempt to promote tourism. Being the wine capital of the country, there is an extensive plan laid out to promote wine tourism in the region. They have run a variety of campaigns in the past to promote the region, the major ones being “best backyard “and “let yourself go “campaigns.
The most important focus is to ensure easy connectivity between major markets that would help them boost the travel rates and also would make it a preferred tourist destination as most of the visitors are more inclined to travel to regions having good connectivity. Another area of improvement that they should look at is to promote themselves more in the Asian markets by means of localized promotions to gain the lost ground due to the euro zone crisis. They should also try and consolidate their position in terms of getting more repeat visitors from their existing markets. Even though they are extensively making use of the digital media platforms, they will have to focus more on social media platforms to ensure that there is positive word of mouth and at the same time they should also engage in the digital media campaigns that are relatively inexpensive but at the same time effective. Another area of focus should be in building digital media tools that would help the travellers in booking and planning the travel which is more likely to create a buzz and increase in the number of visitors. Lastly they should work with all their travel partners in coming up with innovative solutions that can be made use of in ensuring that more repeat visits happen within the region and hence promote the tourism within the region. South Australia is unique in many ways and if promoted well has the potential to achieve the target of 8 billion visitors by 2020 that they are aiming at.