TVS Snapshot - CEO Commentary

For period ending 30 September 2011

The latest round of visitor survey results for Tasmania for  the year ending September 2011 and the September 2011 quarter, fundamentally  confirm what we already know about the difficult times that tourism in our  state has faced over the last year.

It also reflects the difficult business environment for  tourism generally in Australia with the overall decline in interstate holiday  travel by Australians, which is being replaced by strong growth in holiday  travel by Australians to overseas destinations.

In the latest results, we see that around 51,000 fewer  visitors arrived in the state on regular air and sea passenger services in the  12 months to September 2011, which is a sizeable 6 per cent drop in visitors  compared with the same period last year.

Not only were there fewer visitors arriving on our shores,  but they also did not spend as much time in the state to explore more of our  regions, so all areas of the state felt the effect of fewer visitors.

And while the figures showed that we managed to gain bigger  yields from each visitor that came to the state, this was not enough to offset  the overall reduction in total visitor numbers. This led to a small 2 per cent  drop in total visitor expenditure, which is the first time in recent years that  total annual spending by visitors to Tasmania has actually decreased. 

You will notice in the latest Tasmanian Tourism Snapshot  that we have also introduced high level results for the September quarter.  These figures confirm that Tasmania's tourism difficulties have clearly been  compounded over the past six months and especially over our winter quarter.

It has been suggested that access issues appear to have  played a part in this through events like the Chilean ash cloud effect, the  loss of Tiger Airways flights to Tasmania, and a general reduction in airline  seat capacity into the state.

For example, according to the Bureau of Transport and  Regional Economics, in the September 2011 quarter there was a 14 per cent  reduction in total airline seat capacity on our four major direct routes  between Melbourne, Sydney, Launceston and Hobart, compared with the same period  in 2010.

That amounted to around 120,000 fewer airline seats in and  out of Hobart and Launceston airports during that three month period, with  Hobart experiencing most of this reduction.

As a result of the reduced capacity, the load factors on  flights have become so high that it has become more difficult to get an airline  seat to or from Tasmania, and often, the remaining seats attract high airfares.

The fact that the percentage fall in visitors for our  September quarter bears a close resemblance to the percentage reduction in  aircraft seat capacity over a similar period is in my opinion, no coincidence.

It just goes to show the critical role of air and sea access  to the health of our tourism industry, along with many other industry sectors  in Tasmania that need reliable and regular air and sea services to get their  products and services to their interstate and international markets.

But rather than look backwards at the last 12 months, we now  need to focus on the year ahead, and in that regard, we need to finalise a few  vital aspects for the tourism industry to put us on the best possible footing  to take advantage of the opportunities that will come over time.

From our perspective, Tourism Tasmania's restructure is  virtually complete. This means we will be launching into 2012 with a new and  leaner Authority that ensures the bulk of our resources are focussed on the job  that matters most to our industry – marketing Tasmania as a top-class holiday  destination.

However throughout the restructure, we have continued to  maintain a solid marketing program to drive destination awareness.

For example, we have continued to run a very busy Visiting  Journalist Program which is delivering a cost effective and positive profile  for Tasmania on the mainland and overseas. Our spring campaign has also  recently ended and of course, our digital marketing activities and work with  our distribution partners continues.

The feedback I have received about the campaign along with  our own tracking has generally been positive. Not only will it help us to shape  our advertising for 2012, but the level of awareness and interest we have  created about Tasmania in the past couple of months will continue to benefit us  greatly in 2012.

However, the best marketing in the world is quickly rendered  ineffective if our visitors cannot easily get to and from our island, or if  what we provide them does not match the expectations we create.

While Virgin, Qantas and Jetstar are introducing new or  expanded capacity on certain sectors for the mid-December to end of January  peak holiday period, the need for extra capacity in 2012 on an ongoing basis  from all airlines is vital.

So it is no surprise that we need to work even harder on the  development and the implementation of an Access Strategy, so that as a state,  we can better address the access situation together as a collective of industry  sectors, rather than it being the sole responsibility of tourism.

In addition to access, our destination marketing also needs  to be backed up with the right kind of regional products, experiences and  marketing for our target audience. So it is just as important that we work even  harder in our joint efforts to get the new network of four regional tourism  organisations underway in 2012

2012 is the time to roll up our sleeves and get our ducks in  order, so that we can get out in the marketplace with the right destination and  regional marketing programs, industry and trade partnerships, and tourism  products, experiences and services, to inspire more of our target audiences to  holiday on our island state.

Tony Mayell
CEO

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