Tourism’s chance as the stars align

The stars have aligned in the most spectacular fashion for West Australian tourism.

The CEO Voice series — co-hosted by the Australian Institute of Management WA andThe West Australian — was this week told that for first time WA’s travel brochures can lay claim to a vibrant capital city as well as plenty of unique experiences and beautiful landscapes.

Perth was enjoying a record supply of hotel rooms, the highest-ever number of airlines flying into the State, and with plunging oil prices, the lowest-ever fares in real terms, according to Nathan Harding, the managing director of Discover Australia Holidays.

The low Australian dollar is keeping overseas tourists happy, and the Chinese — who have recently emerged as the world’s biggest and richest pool of travellers after moving from a construction to consumption phase in their economy — are on our doorstep.

With well-established ties between WA and the Middle Kingdom, could the State’s fading China-driven mining boom be replaced by a China-driven tourism boom?

“If we cast our minds back to 15 years ago, we had too many hotel rooms, not enough airlines and not enough customers,” Mr Harding said.

“Then as airlines started to fly into Perth, the mining boom kicked in and the corporate sector largely started to crowd out the leisure visitors in hotels, which had a choking effect in stopping visitation.

“Now the corporate sector is pulling back a bit, which is opening up space for ... the leisure market.

“We’ve never had everything structurally aligned in the industry like this before. It is the first time we’ve had the rooms, the aviation access and a brand new fresh product to sell, so the only job now is to get out and sell it as best we can.

Adam Barnard, managing director of tour group operator ADAMS, called it a “once-in-a-lifetime opportunity”.

“We have never set a set of factors like we have now, and if we do it right, it could change Perth for ever,” he said.

AIM WA chief executive Gary Martin said Perth’s tourism offering was likely to improve further with major new developments in the near future.

“Over the next decade, new infrastructure like Elizabeth Quay, the stadium and the Scarborough foreshore development will further drive interest,” he said.

Stephanie Buckland, chief executive of Tourism WA and keynote speaker at CEO Voice, said the agency’s primary focus in recent years had been addressing infrastructure needs, like accommodation and aviation access.

The approach worked well, with travellers to WA in 2014-15 spending $8.7 billion, an increase of $400 million on the previous year. The next strategic stage, to boost annual expenditure to $12 billion, involved a focus on marketing.

“WA gained an international reputation in leisure markets as actually being closed for business (during the mining boom) so we really need to work together to change that perception,” she said.

The targeted marketing approach involves seeking out key markets, like travellers considering pre and post stays when they come to WA for major events. WA has four big opportunities next year, including an LNG conference in April, the World Masters Athletics and the World Masters Cycling championships as well as the University Games.

Ms Buckland said the Chinese market also had huge potential for WA. She said the notion that Chinese tourists wanted to sit on tour buses and tick off a few tourist icons was outdated.

These days they were more likely to be independent travellers, wanting unique experiences and to enjoy clean, fresh air, blue skies, and fresh, safe food.

Tourism WA advertises Margaret River in China to appeal to these popular sensitivities. The council was hoping for an airport in Busselton that would one day accommodate international flights.

A co-ordinated approach with other sectors, like international education, was also likely to reap rewards.

Grant Brinklow, chief executive of Sandalford Wines, questioned whether WA was “China-ready” given the vast cultural differences in service culture. He said the South West had a huge opportunity to service China’s increasingly affluent travellers, especially if it gets its own international airport, given Margaret River was the closest wine major region to China and in the same time zone.

With so many circumstances in WA’s favour, what could possibly go wrong?

Evan Hall, chief executive of the Tourism Council, said regulatory red tape made it very difficult for tourism operators to set up new or innovative products.

He said the experience with Segway, a group running tours on two-wheeled, self balancing vehicles at Rottnest Island and Fremantle, highlighted problems with regulations which were threatening to suffocate new or innovative products.

Even though the tours had support from the State Government and tourism minister, it still took 18 months to get necessary approvals.

“Segway was just sitting in a container, about to go bust, while trying to get approval to ride them on paths that people already ride bikes along,” Mr Hall said.

“You see conditions put on approvals that make a project untenable, or the time involved just knocks them out of the process.”

Mr Hall said problems were further exacerbated by the high cost of doing business in WA, with relatively high wages and penalty rates which made opening on Sundays untenable for many hospitality venues.

“There is no one who can say yes to a tourism product, but five or six agencies that can say no,” he said. 

Bradley Woods, chief executive of the Australian Hotels Association, said the State Government needed to pour more resources into the tourism industry, as it had in the mining sector.

He said while Tourism WA did an enviable job, it had a moderate budget and was distracted from its marketing role by other duties, including time-consuming responses to ministerial questions. Mr Woods accused the State Government of short-sightedness for cutting the budget of the Perth Convention Bureau over the next three years by 28 per cent.

“For $3 million it delivers about $120 million worth of business to Perth, and the State Government has cut its budget. Some lower or middle bureaucrat has decided he can sniff a little money out here, but what is the impact down the line? Jobs.”

Fremantle mayor Brad Pettitt and Perth Lord Mayor Lisa Scaffidi, said WA needed to further hone its brand on the world market. Ms Scaffidi said there should be a focus on promoting WA as an education destination, because it not only attracted students but their families as well. She said working on sister city relationships would also boost travel.

Mr Pettitt said Perth should highlight its unique features, given travel guides like Lonely Planet endorsed places that had quirky and unusual experiences.

Ms Buckland said WA had plenty of unique things to offer, such as swimming with whale sharks or having a selfie with quokka.

Mark Shaw, chief executive of Adventure World, said there was a focus on promoting WA’s natural beauty, but it should incorporate Perth’s man-made attractions as well because 83 per cent of travellers visited cities.

But is it a case of build it and they will come? Not according to Paolo Amaranti, chief executive of Rottnest Island Authority, who said it may be necessary to build it, listen to public feedback and then rebuild it.

He said upgrades at Rottnest were driven by consumer demand, given the well-travelled public was no longer prepared to settle for mediocre facilities.

Finding enough staff may also be an issue, especially as hospitality and tourism are not considered a life-long career in WA. There was an anticipated shortfall of 1000 workers by 2020.

Hyatt Regency general manager Sholto Smith said WA did not embrace tourism in the same way as countries that relied on it for survival.

Source: The West Australian, Kim Macdonald, 7^th December 2015