How to cure Australia’s tourism industry
When the Managing Editor of Australian Traveller magazine – a publication that promotes tourism in Australia as part of its core purpose – has a pop at the often shambolically amateurish standards within the Australian tourism industry, you know there’s something wrong. Quentin Long’s illuminating post about his wife’s travails in getting a baby from airport to hotel shows a much wider malaise.
Millions of words have been spilled bitching and whining about the state of Australia’s tourism industry. The two major perceived problems are (A) that Australians are choosing to go abroad rather than take a domestic holiday and (B) foreigners from traditional markets – especially Europe – are choosing to go elsewhere.
There’s more to it than that, of course, but if it’s taken purely as a numbers game, then getting locals to stay and foreigners to come is the main task. But some things need fixing – and I’d suggest the following steps.
Deflate the dollar
Take all the other factors combined, and they don’t have as much impact on Australia’s tourism woes as the high Australian dollar. It has soared over the last few years, and it is still soaring. If the government really wanted to help tourism operators, it’d take steps to devalue the Australian dollar. Alas, it’s not that simple. Australia’s booming resource sector has kept the country out of recession, and Australia doesn’t have the financial muscle to buy enough of other currencies. Like it or lump it, the high Australian dollar isn’t going to go away any time soon. Adapting to it rather than moaning about it is key.
Apply international standards, not Australian standards
Any divisions between domestic and international tourism are largely outdated. If Australians are going overseas because – even including the cost of long flights – they can get better for less money, then arbitrary market divisions are academic. Australian tourism is operating as part of a global market, and thus international standards have to apply. “Good by Australian standards” is no longer good enough. The Gold Coast has to measure itself against Bali, Phuket and Fiji – not just Cairns.
That means ditching the poisonous “this is the way it’s done here” attitude that pervades many Australian tourism operations. It may have been done like that in the 70s, it may have been done like that in the 80s and 90s. This doesn’t necessarily mean it can be done like that now. If you’re closing reception for 12 hours a day, charging $25 a day for patchy WiFi, adopting a “not our problem” approach to customer complaints and opting for ‘character’ over competence in your staff, then you’re out of date.
There’s a massive, arrogant sense of entitlement within the Australian tourism industry – as if the visitors are there for the purposes of the operators, rather than the other way around. That has to change.
Professionalise the lifestyle operators
This is partly because – as Quentin Long alludes to in his post – many operators and accommodation owners are in the tourism industry for lifestyle reasons rather than business reasons. There’s still the ludicrous idea in Australia that you can retire from your job, move to the beach and earn a few bucks by running some kind of tourism operation – be it small hotel, tour guiding or a bar/ restaurant. It’s insanity – running a successful tourism business eats any spare minute and requires fearsome amounts of hard work.
If you want a beach lifestyle and time to follow your hobbies, keep your job in the city, move to Coogee Beach, commute in every morning and make the most of your weekends. Don’t blunder about doing something you’ve no training and no aptitude for on the arrogant assumption that anyone can do it without having to work all that hard.
The brutal truth is that the average holidaymaker doesn’t care what time you got up, how many hours you put in, how far your profits have slumped, how you can’t get reliable staff for the pittance you’re prepared to pay them or why you’ve not got round to fixing the broken tap. They just want a good holiday. Rule number one: IT’S NOT ABOUT YOU.
Get real on pricing
The problem isn’t that Australia is expensive. It’s that it’s overpriced. There’s a subtle difference. As a general rule, what you get isn’t really worth the money you’ve spent. There are noble exceptions, but nowhere is this more true than in accommodation. The problem is that accommodation providers are thinking in Australian dollars. Five years ago, A$150 a night would have been a reasonable price for a mediocre three star hotel. The fair assumption would be that, with inflation, $160 to $170 would now be reasonable.
The problem is that pesky Australian dollar – especially when looked at from an international perspective. Using the pound as a comparison point, five years ago, A$150 would roughly equate to £60. That’s OK for a mediocre, nothing special, low mid-range hotel. Now A$150 equals around £100. For that, you’d expect something rather good – it’s high mid-range, bordering on luxury for most. So unless you’ve made drastic improvements to that mediocre three star hotel in those five years, A$160 to A$170 isn’t a reasonable price to be charging from an international perspective – it’s a rip-off. And I’ll refer you to point one about the imaginary division between international and domestic tourists.
Alas, a reasonable price for that hotel is probably around A$100 max. You can shriek “but I’ll be earning far less than I did far years ago” or “impossible – that doesn’t cover my costs” all you like. It doesn’t make it any less true. Your old car or computer isn’t worth as much as it was five years ago either – deal with it. Operators may not want to, but they need to find a way of cutting prices by at least 25% – preferably nearer 35% – if they want travelling in Australia to be seen as competitive again.
Bring in a budget hotel chain
Australia badly, badly needs an equivalent of the affordable chain hotels such as La Quinta in the US or Premier Inn in the UK. If the competition puts some of the outdated, family-owned businesses around the country out of business, then so be it.
Re-enchant the backpackers
The massive thing that Australia has in its favour is that it has long been a sexy destination. People will travel from the other side of the world to go there, and people generally love it when they arrive. But if you think it’s the luxury outback lodges and high-end tourism that give Australia that word of mouth factor, you’re very wrong. It’s the backpackers.
Let me explain. Backpacking around Australia has long been something of a rite of passage for youngsters on a gap year. They generally go round, have a great time, and then remember it fondly for the rest of their lives. And when they’re older and richer, many of them will come back to Australia to stay in more expensive places and do more expensive things.
If you lose the backpackers, you lose both the critical word of mouth and the luxury tourists of the future. The backpacker market is traditionally seen as one that will take care of itself. The industry needs to be wary of this – Australia is increasingly being seen as far too expensive to travel round. The shine is wearing off, and travellers are spending less time there. This has to be addressed as a matter of priority. How is a different matter, but relaxing visa restrictions and any initiatives to reduce the cost of hostel stays would be a start, whilst promotional thrusts on things that are very cheap or free to do would make an awful lot of sense.
Focus on the unique and unusual
I’ve said this many times before, but no-one cares about how good the coffee is in Melbourne. Everyone wants to see koalas, however. If you want people to come to Australia, the message needs to be about what they can’t do anywhere else. And it needs to be rammed home at the expense of anything that can be done better, cheaper or nearer elsewhere.
Stop being lazy with indigenous tourism
One massive unique selling point that Australia does have is 50,000 years of Aboriginal culture and history. People want to know about Australia’s indigenous people, they want to learn more about the culture and they want tourism products that help them to do this. Unfortunately, many of Australia’s indigenous tourism products are terrible, often based on the lazy assumption that as long as Aboriginal people are involved, that’ll do. Unfortunately, being authentically indigenous doesn’t require any skill at all. Being a good tour guide does – and the standards shouldn’t be loosened because it’s an indigenous tourism product. The problems in Australia’s aboriginal communities aren’t going to be solved by giving everyone subsidies to run tours or open art galleries.
Mercifully, it seems as though the “aboriginal and thus it will do” attitude is changing. I’ve heard good things about a couple of tours that I’m going to try in Perth in April, while the free handbooks to sites of Aboriginal significance in Sydney are a great step.
Invest in the trains
Australia needs high speed rail connecting the major cities. Full stop. Stop debating the cost of it and get it done.
Teach Chinese
If I was one of the lucrative Chinese tourists that are seen as the saviours of Australian tourism, I’d feel rather lost and intimidated in Australia. Chinese signs are almost non-existent, and very few people in the Australian tourism industry speak any version of Chinese. Mandarin should be being taught in Australian schools from the age of five. Or, more realistically, tourism and hospitality courses should at least have some language-learning element to them. It’s not enough to expect everyone to understand English.
Reckon you’ve got better ideas? Then leave a comment below…
Ouch.
Ouch.
Ouch.
Ouch.
I think they call this ‘tough love’.
Very well said David! You’ve hit the nail on the head. I think I’ll be forwarded this post on to all the Tourism Australia and State Touism Office contacts I have! …. So will you be heading to Outback on your next trip to Oz??
I don’t know that I agree with the learning Chinese in school bit. As somebody who got a degree in Japanese language back in the 90′s and has worked as a medical interpreter, the low pay within the tourism industry doesn’t justify spending many years at school studying a foreign language just for that purpose. I can certainly see the benefit of people working in the tourism industry having a knowledge of Chinese, and thus studying it as part of a tourism diploma maybe, but for those who spend many years studying a foreign language to a high level, they would do much better to use those skills as an interpreter or combining it with a degree in business or economics. And there’s the catch 22. What is the incentive for great foreign language speakers to work in the tourism industry? There is none. Which is why we often have very poor language speakers catering to our tourists simply because they are the only people available. Of course there are many good speakers, but they quickly realise that it’s hard to support a family on tourism wages and leave in search of better paid jobs with more future prospects.
So many great points!
The hotels and costs is spot on, agreed with the trains, languages and the indigenous experiences, especially!
Great post!
Well you are certainly true to your style of keeping things to the point David.
There are some good points, a few I am not totally into and also glad to see TA replied to some of these points via twitter just now @TourismAus. A few comments from me for what it’s worth;
I agree re Teach Chinese, though it is happening slowly e.g. my nieces & nephews learn it in primary school but the same thing happening with Japanese, by the time we cottoned on and learnt it, the market had changed…… so yes faster action here would be good.
Totally agree re trains
I don’t think it is laziness in relation to aboriginal tourism I think it is a genuine lack of understanding of how to communicate & work with aboriginal communities which in part steams from our appalling history. Many regions are trying but in my experience there are so many complications plus a disparity in what people will spend (time and money) for these experiences.
Re-enchant the backpackers – agree, based largely on the reasons you mention as I heard those stories constantly (came as a backpacker loved it, now I am here with my wife and child 10 years later). Would add to encourage those living within Australia to backpack within Australia.
Get real on pricing – this is where it starts to get tough – do you realise accommodation doesn’t really make much money….?
Professionalise the lifestyle operators – I hear what you are saying but tough luck – you cannot force operators into becoming professionals -Just choose not to stay there or use them and rely on others including good hotels, trip advisor, friends etc to get that info – if they want that life then that is their choice – I would say professionalise the professionals and we would get somewhere.
Expensive wifi has to go no doubt about it (just build it into the room rate people or take from the marketing budget!!) and staff attitudes across all the service industry have unbelievable issues from many of the stories I have heard recently. This IS being talked about within the industry – at conferences, meetings etc – it is good to keep on about it and encourage the good stories to be shared widely as well as the bad.
Wifi is indeed too expensive. We will not use the hotel service anymore, we just buy a prepaid micro sim for our ipad and are way better served as the rippoff offers from hotels (ibis sydney charges 24.50 aud per day…)
Incredible!
@Shaney – Yup. I love the country. I love travelling there, and it’ll always be a part of me. But there are problems.
@Kim – Not into the Outback this trip I’m afraid – it’s Brisbane, Byron, Whitsundays, Perth and Sydney.
@Paul – I’m not necessarily suggesting fluency is essential. But being able to string the odd sentence together and respond to an enquiry may help.
@Holly – As I say, I think the Aboriginal tourism issue is being addressed. For the lifestyle operators, no you can’t force them at all – and the poor ones will eventually go out of business. However, I think discouraging the mentality would be helpful.
Regarding the pricing. Yep – I totally understand that hotel owners aren’t making much. But I do think that instead of griping about it, they’ve got to look harder at ways to bring those prices down. It’s not going to be easy – the easy option is to keep things as they are and make excuses.
Good to hear that service is realised to be an issue though. Australia will never do Asian-style service well. It does need a mindset shift – the it’s not about you that I was talking about – however. It’s not everyone, or even necessarily a majority, but a sizable enough minority to count.
As Holly said, Tourism Australia did respond to me via Twitter. Responses as follows:
@mrdavidwhitley Not sure if you are aware of Indigenous Champions Program, worth a look http://ow.ly/1GM55v
@mrdavidwhitley international standards? Recent accreditation tie up with TripAdviser, move in right direction? ow.ly/1GM6ge
@mrdavidwhitley re-enchant backpackers? Too right. ’30 Days in Oz’, uk campaign last yr aimed at backpackers & WHV http://ow.ly/1GM6N0
@mrdavidwhitley focus on unique and unusual? Watch this http://space…for next phase of There’s nothing like Australia…
@mrdavidwhitley deflate the dollar? Maybe beyond our control but we can suggest some ways of mitigating against it http://ow.ly/1GM7Gr
The links are worth a look at. For the record, my post wasn’t aimed at Tourism Australia or any of the country’s tourist boards. On the whole, I think they do a pretty good job. The Indigenous Champions Program is definitely a good thing – and as I say, I think that particular problem IS being addressed.
The backpacker-targeted marketing is a much-needed acknowledgement of this sector. Has it worked? I’m not certain – but part of that is down to the high dollar, which only so much can be done about. The country could do with a couple of emerging ‘hip’ backpacker destinations though – places that get that word of mouth buzz like Byron Bay or Mission Beach or Agnes Water once did.
The recent ads I’ve seen in the Nothing Like Australia campaign have certainly been a step in the right direction and it’s good to see the dollar issue being discussed (even if there’s only so much that can be done).
A unified cross-Australia T-QUAL standard is good too, although I’d seriously question the merit of teaming up with Tripadvisor to promote it as a mark of quality. People use Tripadvisor, it’s well known, and I use it myself. Is it associated with quality? I’m not so sure. And for all the efforts, it’s still Australian standard rather than international standard and it says nothing about value for money. That’s the sticking point. A mediocre Australian resort will usually cost far too much.
The points I’ve made aren’t easy problems to solve, and they can’t really be solved by a tourism authority. They have to be solved on a one by one basis by operators. Some are actively trying to change things. Too many are willing to cling on to an old way rather than adapt. Again, it’s not all. It’s probably not a majority. But it’s too many.
Hi David,
but I think the Australian Tourism board could do a better job of promoting some of the more obscure and offbeat parts of the country. Undoubtedly there are the highlights that most international visitors want to experience – Uluru, Sydney Harbour, Cairns. Getting out and experiencing small towns, national parks and off the beaten track experience will not only highlight alternative travel but also encourage guests to spend longer in the country.
As a small business operator in Melbourne it was with great interest that I read you piece above. I agree with a lot of what you have said, slightly disagree with some of it and would happily like to add my own two cents.
The increase in the Australian dollar is obviously a major concern for the domestic and international market. Whilst it may be easy to say ‘get real on pricing’ – the practicality of decreasing the cost in a growing economy is extremely difficult. The skyrocketing increase in cost of living, the recently introduced Carbon tax, insurance costs and high minimum wage has a knock on effect for all businesses and their suppliers. Whilst hoteliers have a greater capacity to inflate and decrease costs according to the market, other operators and not so lucky. Cutting costs is a must though, therefore other operators must look alternatives to bringing down cost – offering tours/services without additional add ons (lunch/coffee etc) as an example.
Your comments regarding the standard of service are not echoes that I hear often from international tourists. In spite of this, I’m sure they exist. Whilst it’s easy to say the better service providers will rise to the surface, I can see some room for improvement from others. Statewide tourism boards need to offer training and courses for the benefit of those business operators in the industry. Many that work in the tourism industry are not trained professionally and in the past have relied on simply opening a door for guests to arrive. You make a valid point that we now need to coerce these visitors to our country.
The unique and unusual is something that I strive for with our own tours – I disagree that no-one cares about the coffee in Melbourne
Next time you come to Melbourne I would cherish the opportunity to show you the city and demonstrate what we are doing to encourage tourism – sans coffee (and Mandarin).
Cheers,
Dave
I could write an essay on this topic, being an Australian who frequently travels around the country, as well as overseas. Thanks for writing this article David.
Allow me to just go in point-form here:
1. The high cost is not going away, for any foreseeable future. Wages here are amongst the highest on Earth. Nobody earns less than about $17 US per hour – it is the minimum wage. On a Sunday, that Irish backpacker serving you a beer, is on a minimum wage of ~$38.50 USD, per hour. The employer contributes 10% on top of that for retirement savings (superannuation). Simply, restaurants, and all service related prices, will remain expensive. If you can fix this, you will become Prime-Minister. There may soon be an opening
2. Despite having amongst the highest occupancy rate for Hotel rooms of any city on earth, in Perth (pop closing in on 2 million – only city on the West coast), construction costs have created a situation where it is NOT cost effective in most circumstances to build a new hotel – and definitely not a budget hotel. It’s simply too expensive to build now, with many construction workers having a salary of 200k, and even more, per year. The business case says, don’t build, and the market has spoken.
3. There is an enormous amount of overseas investment in Australia, particularly in resources. The sums of money at stake are astronomical compared to the small population here. Nobody is baulking at paying high prices – tourism is not down, hotel occupancy rates are not down. Restaurants and cafes, even with Swiss-like prices, are busier than ever. In many industries, Australia is already running at capacity. There is absolutely 100% zero chance that a decent hotel room will cost $100 a night in an Australian city any time soon. It would take a global economic shock, or some other Black Swan event, to change this.
4. The Australian economy is simply so strong at the moment, that Tourism is an also-ran. The government has priorities elsewhere.
5. Australian tourism is resting on it’s laurels. Australia remains a dream destination for half of the planet (and, for very good reason). As a “once in a lifetime” type of destination, I do not believe the high prices, bad service, and other ills, will have as much of an effect as it would in other nations.
6. High speed train-line – don’t hold your breath. This will take decades, at minimum, and even then will only connect two cities.
7. Indigenous tourism – you are dead right about this. For many reasons too controversial to enter into here, it won’t happen.
8. Australia is a big place, to state the obvious. Most of the best attractions are, by their nature, isolated, and ecologically fragile. Simply put, more than anywhere else, they would be destroyed, permanently, by tourists. Areas such as Ningaloo Reef in Western Australia are already seeing the negative effects from even small numbers of visitors. Food for thought.
There are some enormous obstacles to overcome in Australia, and they have been debated ad-nauseum, with no solutions forth-coming. We truly are a victim of our own success.
My prediction – things won’t change much, and we’ll still be OK.
In 2010/2011, Australia saw a record number of short term overseas visitors. Predictions are, this will increase again in the current financial year.
More than happy to catch up for a beer and a chat when you’re in Perth, I’m a local.
Again, thanks for bringing some well needed attention to these issues!
Sorry, some stats to back my claim that tourism is up. These are the latest Australian Bureau of statistics figures, for the financial year ending June 2011:
* Tourism employed persons increased by 2.7%, or 13,500 persons
* Direct tourism GDP increased by 2.5% to $34,595m
* Internal tourism consumption (total domestic and international consumption in Australia) increased by 2.6% to $95,653m
* Tourism exports (international tourism consumption in Australia) increased by 4.4% to $23,681m
..and from wikipedia (cited) “The 2010-11 financial year saw a record number of overseas arrivals in the financial year, with 5.9 million short-term visitor arrivals to Australia (or 588 extra visitors a day extra).”
Beer? Perth?
Although I agree with many of your points from a European perspective, I think you’re wrong on almost all counts (including the ‘learn to speak Chinese’ one), because PRC tourism is the future for the Australian tourism industry industry.
Australia is simply not delivering what Chinese tourists want. It’s not hard. Chinese-run tour operators are already doing it, but in a shonky way. Australian operators could do it so much better, if they tried.
My Chinese sister in law came to Australia on holiday but left early because she was disappointed by the crap service and the racist/patronising/cash cow attitudes towards Chinese tourists.
Domestic tourism in China is now highly competitive and increasingly sophisticated. There is a growing Chinese middle class that wants to travel independently, stay in good hotels, eat good food and see interesting stuff. They don’t want to “rough it” and stay in hostels. They don’t want to drink (unless it is a very expensive wine or cognac). They aren’t stupid, and they don’t want the standard tour-by-numbers with stops at fake “duty free” shops. They want to be pampered, stimulated and treated as VIPs, or at least as educated (which they are) travellers.
The independent Chinese traveller is is a whole new market, potentially bigger than the “backpacker” market. I don’t work in the tourism industry, but if I did, I would be thinking of ways to meet this massive new demand.
We just spent two months in Australia as part of our RTW and you really nailed the problems. High dollar, expensive and slow Internet, expensive lodging,food,everything.
One suggestion would be for rental flats to offer better prices for a weekly rental rather than just paying seven times the nightly rate. Most countries offer a discount for a weekly rental.
We were astonished at the lack of Aboriginal tourism It was the exact opposite during the month we spent in New Zealand where the Maori are much more present.
Even more shocking to us was the amount of unsolicited racist comments we heard about Aboriginals from people we had just met.
We loved our time in Australia and we understand the economics of the strong Aussie dollar. The reality is that the mining boom will eventually bust, they always do, and the dollar will come back down. But that will be painful too.
Good on you for addressing these issues.
Reading with interest. My two bob’s? TRAINING
A recent unescorted tour through rural Australia highlighted some gross inadequacies in training, especially customer service. It’s no good just giving someone a job, they need to know how to do it.
eg Stayed at highly rated Anthology product at Wilpena Pound (SA) Superb location, but staff… ARGH! Apparently the phrase for “Can I help you?” is “Youse right there?” delivered with a scowl and impatient “I’ve got better things to do” attitude. Aussies need to get over themselves and deliver the product – or go do something else.
Kiwis eat us alive in this respect. Customer service seems to be in their DNA.