Is Australia pricing itself out of the travel business?
Everyone loves a holiday in Australia. International visitors enjoy coming to our beautiful country and enjoying all the famous parts, while Australian’s themselves look forward to getting away on weekends and holidays to all the wonderful nooks and crannies our awesome country has to offer. There is not many places in this country that cannot be enjoyed on holiday.
But lately I am noticing a few complaints from our international friends, and Australians alike. The main problem it seems is, we are just too expensive as a destination, and the customers are choosing more affordable destinations to spend their hard earned.
Sure, it has not been an easy couple of years, what with the GFC, rising interest rates, fuel prices, the Australian dollar, natural disasters and in the future, a carbon tax that will do nothing for the climate, and even less for tourism businesses in Australia.
But these factors aside, Australia as a tourism destination, has been in decline with international visitors for at least the last 5 years. And thanks to government, banks and energy suppliers, these costs are continuing to increase and take a bigger toll on the 2nd largest industry in Australia.
Most tourism service providers have been weathering this storm for years, if they are lucky, managing to eke out a living and just survive. Plenty have fallen by the wayside. Many would argue, well that’s so “Darwinian” and the stronger better capitalized will survive. But at what cost? Without good competition in this industry, we are seeing high prices and poor customer service, and a lack of any vibrancy about the future of travel in Australia.
Operators seem to be happy to charge whatever their competition is charging, or maybe a little less so they may say “we have the best rates” . But the difference of this pricing structure was highlighted when I researched the price of hiring a 4 berth camper for 1 month in Australia, and 1 month in California – it was shocking to say the least.
1 month hire in California USA - $1026 (aud). 1 month hire in Sydney Australia - $4122 (aud) and they both included travel insurance! With the dollar at parity, this only looks like theft to international tourists. After the additional costs are factored in such as fuel (half the price in USA) food, and souvenirs, just this example goes to show, why we are being left behind by world travellers.
The hotels in Australia, are also between 50-200% more expensive than Europe, usa and even New Zealand? Australian Ski resorts charge over $100 for a day ticket to put up with patchy conditions and over priced food, drink and accommodations. You can get better skiing in New Zealand for half the price. Most accommodations are lucky if they can boast more than 20% occupancy rate over a year. Do you think they would encourage more domestic and international visitors if they charged half what they do now? Or are these businesses happy to just run minimal staff and cover their costs? A day trip in a 20 seater mini bus to the Blue Mountains from Sydney (1.2hrs drive) costs around $120 pp, with no extras. How many days a week do you think they have a full bus?
Yes there are many costs that affect tourism services, but the way things are going unless things change considerably, international visitor numbers will just continue to decline, and Australians numbers will increase taking their holidays overseas.
I hear the Queensland travel operators mutterings about a decline in business, and blaming it on the floods and cyclone. While some of this may be true, the real truth is they are just too expensive in these uncertain times. Even operators who were unaffected by the flood, make claims about it ruining there business, then ask for government compensation. Get real! Drop your prices, add some value, and start promoting how good value you, and maybe, just maybe – your businesses will start thriving again. Tourism operators had it good for the time leading up to, and during the 2000 Olympics and got away with charging over inflated prices for their service, but not anymore. The prices never went down, and have continued to rise. You could say the tourism industry went into decline, the moment the games were over, and have never really picked up to the heady Olympic heydays…
Australia is made for tourism, and I think many in the industry are oblivious to the fact, and assume people will always come. Have you noticed the Japanese on holidays in Australia lately? 10 years ago they were everywhere and loving our friendly holiday destinations. What about the back packers, there are less and less of these valuable tourists visiting now, due in the most part to the un-affordability of Australia.
Australian tourism needs a real injection of aussie enthusiasm to invigorate this fading market. The current financial situations that are enveloping the world, caused by government and banking mismanagement is not looking like it will improve for some years to come. Travellers the world over from low income to wealthy, are all looking for ways to save money. And if the tourism industry want to survive and grow, it needs better promotion, targeting the price factor in the marketing of our unique country.
We are competing with other countries for the travel dollars, and we need to encourage them back here. I propose we have a 50% Off Australia promotion for a year, and see how that will stimulate the Australian economy. More tourists, more occupancies, more jobs, more interest. The Oprah Show, while probably a good promotion to the world, I wonder how many visits it will bring for the 10m price tag. It should have promoted the great value holidays we have here. Oh that’s right, we don’t have any good value holidays here…
I love this country and love this industry, but unless we take some dramatic steps that we can take, we may as well just say, “ hey I know we’re more expensive than everywhere else in the world – but you’ll get your money’s worth” Is that all we have to offer?
So come on Aussie travel operators – get passionate about your service and tell the world we’re the best value place in the world to holiday – Take the 50% Off Australia challenge and renew the industry positive way. It will be a lot more stimulating to our country than any carbon tax!