Changing face of NZ tourism

New Zealand's tourism industry is having to cope with a sharp shift to last-minute bookings.

The industry is moving through a period of unprecedented change that started with the global financial crisis with visitors only booking in the short term, industry leaders say.

The change in booking patterns from international tourists means marketing by Tourism New Zealand and others needs to be more nimble and focused, Tourism Industry Association (TIA) chief executive Tim Cossar says.

Cossar was speaking at tourism industry showcase Trenz 2010 where the industry talked of making the United States the number one market for marketing spend.

The financial crisis, events like swine flu, the Icelandic volcano eruption and political unrest in countries like Thailand means the international traveller is much more wary about booking ahead.

To help cope with the more volatile environment New Zealand tourism needed a sustainable relationship with overseas buyers of Kiwi products and a long-term commitment in funding from the Government, Cossar said. In the last two years as TIA chief executive he had noticed a sharp move towards last-minute booking by visitors, part of a profound industry change.

This was driven by the online space being a much quicker and more cost-effective marketing tool.

Many forward bookings had disappeared with that change, he said.

He said the $30 million increase in the Tourism New Zealand (TNZ) budget for 2010-11 to $99m was for one year only.

"If I said what is a priority; well we want to make sure new additional funding is locked in for an additional period of time. Yes, $30m more for one year is great and it helps us set the wheels in motion.

"But the reality is if you want to joint venture with industry and partner offshore and that sort of thing, you've got to have a long-term commitment to that."

Trenz is being held for the second year in a row in Auckland. Trenz information states that the number of venues large enough for Trenz are limited to Auckland, Rotorua and Christchurch. But there are unconfirmed rumours at this year's event Queenstown could host the event for 2011.

TIA and TNZ had talked together on where marketing priorities lay, and the association now thought that niche marketing towards like-minded travellers like fly fishermen was being considered alongside geographic advertising.

TNZ chief executive Kevin Bowler and TNZ USA project director Tim Hunter said the TNZ budget for North America had been increased to up to $15m a year for the next five years subject to Government financing.

That figure would be matched by $15m a year from Air New Zealand as part of a marketing co-operation agreement to give a total of up to $30m a year into the North American market – though with the spending mainly in the US.

TNZ's spending priority was now roughly 15 per cent for North America, 11 per cent for the Australian market, and a sub 10 per cent figure for China and Britain.

New Zealand had around 0.65 per cent of the US outbound traveller market, down from nearly 1.0 per cent at the period at the end of the Lord of the Rings film trilogy.

If the country captured 0.75 per cent of the market it would be worth around $110m extra in spend.

"At the end of five years, by 2014, we'd like 330,000 arrivals from the US."

Air New Zealand yesterday announced it was increasing its international capacity for the November to March 2011 period by 4.9 per cent.

Air New Zealand deputy chief executive Norm Thompson said the extra capacity was being added as the airline started to see a recovery in air travel, though still well below the highs of 2008.

- © Fairfax NZ News