1 million Aussies? Don’t get too excited

Written By: - Date published: 8:43 am, June 23rd, 2009 - 17 comments
Categories: cycleway, economy, john key, tourism - Tags:

So 1,001,880 Australians visited New Zealand in the year to May, up 3.7% over the last May year despite the recession Yay? Well don’t pop the bubbly just yet.

The total number of visitors fell 2.6% from 2,482,881 to 2,418,647. The decrease from other countries wiped out the gain from Australia. And here’s the important thing – Aussies spend less per visit than others (all this data is from the Ministry of Tourism and inflation-adjusted):
average expenditure per visitor
Sure more Aussies are visiting but they give relatively little to our economy per visit; not nearly enough to make up for the loss from other, higher-spending, countries:
total tourism expenditure
In fact, the Aussies are spending less per visit each year.
average expenditure per Aus visitor
Now I’m no big-city tourism policy maker. But I would have thought better strategy might be to target advertising at higher spending markets. Maybe someone should tell the Tourism Minister.

Not that it would do much good. This is the guy who thinks that if you build a national cycleway the tourists will come… and thinks that’s the best thing we could be spending $50 mil on, despite the fact that cycle tourists spend only 75% per night of the average international visitor and there’s no evidence a series of ‘Great Rides’ will attract more tourists. Clearly not one with an eye for a good investment.
-Marty G

17 comments on “1 million Aussies? Don’t get too excited ”

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  1. Maynard J 1
    23 June 2009 at 9:11 am

    Should we not try and get regional tourists to spend more, or stay longer? I say this in regards to the issue of air miles – we cannot be certain those higher-spending markets will want to keep coming here. Mind you, Japan is not far away, and they top the spending tables per head.

    • gingercrush 1.1
      23 June 2009 at 11:01 am

      The Japan market will probably never recover from what numbers we once had from there. Our future is likely with Korea and China. But until things improve internationally we’re best to focus on Australia.

      Whilst Marty G’s post is essentially right. We happen to be in a world economic recession with very few countries not experiencing a downturn. That means you have to make smart investments. Australia is that smart investment. Sure they don’t spend as much as others. But they’re immediately across the Tasman Sea and flights are cheap. The Tourist dollar internationally is scarce. Therefore you have to choose the places where you can see an increase in tourist numbers. Those higher spending markets are also being saturated by tourist advertisements. They’re also further away and thus less unlikely to come here at the moment.

      When economic conditions worldwide turn favourable. Then we can target countries such as the United States, Germany, United Kingdon and Canada. You’ll know that those countries are all in some dire economic times. Also remember there was a guest post here which said New Zealand was on a losing cause trying to get tourists to come here when every other country was doing the same.

  2. indiana 2
    23 June 2009 at 10:03 am

    Why does everything on this blog smack of “tall poppy” syndrome? Is all good news bad news?

  3. insider 3
    23 June 2009 at 10:04 am

    Your bottom axis on visitor numbers is out of scale. It could smooth out that peak a bit

    I wonder if Australians spend less because they come for relatively shorter times – the same way we would shoot over for a long weekend to Sydney, whereas for other visitors the scale of trip is somewhat larger so possibly longer. Wouldn’t a good strategy therefore be a focus on more frequent short breaks?

    I note the big drop in spending levels came during the last govt. I blame Helen Clark 🙂

    • Merlin 3.1
      23 June 2009 at 10:12 am

      It’s clearly (if you look at the tables) the increase and then reduction in foreign students that causes the spike and then drop off in total expenditure.

      I would think it’s cheaper airfares that have led to australians spending less per visit.

      Graphs don’t have to start at zero, especially when you’re looking at the change in something, not it’s absolute value or value relative to others.

    • BK Drinkwater 3.2
      23 June 2009 at 12:06 pm

      The scaling if the bottom axes is fine: the ticks are nine months apart. I have quibbles with this post; the scaling on the charts isn’t one of them.

      (The y-axis of the last chart might more usefully start at zero, as this would clarify that the values all fall within a fairly tight range—[$1800,$2200]—, but I think purists lost that fight years ago.)

  4. George D 4
    23 June 2009 at 12:19 pm

    Well, they are in a recession, so it’s perhaps not surprising that they’re spending slightly less than a year ago.

    I wonder what caused that step drop in 04-05. Perhaps new ski-fields being opened? A rise in the NZD?

    • George D 4.1
      23 June 2009 at 1:04 pm

      Actually, Rudd avoided a technical recession with the huge stimulus package, but a downturn nonetheless.

  5. burt 5
    23 June 2009 at 12:28 pm

    <party_political_message>

    We need to make sure we keet the tourists from Japan and Germany well away from NZ. These rich pricks come here and show us all how good it is for the economy for individuals to be wealthy. The great socialist disaster dream of nobody earning too much and nobody earning too little is at risk if we allow these rich pricks in.

    Fantastic news that low spending Aussies are comming here in increasing numbers, clearly the message that NZ is best for poor people has got through.
    </party_political_message>

    • Maynard J 5.1
      23 June 2009 at 12:46 pm

      We could at least get in more of those poor, depressed and downtrodden Scandanavians. Especially Swedish volleyball teams.

      We should also get some of the really poor people from the USA to visit, and they could tell us what is wrong with our social welfare system and so on, and maybe offer a few suggestions to fine-tune our capitalist system to turn out a few more successes like them.

  6. Zaphod Beeblebrox 6
    23 June 2009 at 12:46 pm

    Get used it, guys, more Aussies will want to see what water and snow looks like. One of the few benefits of global warming.

  7. gobsmacked 7
    23 June 2009 at 1:03 pm

    How many of these arrivals from Australia are originally New Zealanders (whatever passport they now hold) returning to see family and friends? Of course you spend less per visit if you’re staying with Auntie, and eating her food.

    Last year the spin-story was: they’re going to live over there, we’re doomed.

    This year the spin-story is: they’re coming back for a visit, we’re saved.

    I guess that fits with trickle-down theory. Now if we could just persuade the rest of New Zealand to live in Australia and holiday here, we could have a real Pacific Island economy.

  8. craig 8
    23 June 2009 at 3:07 pm

    Why do you keep dissing the cycleway? That’s like the coolest idea from a right wing government ever.

    • lprent 8.1
      23 June 2009 at 3:44 pm

      It is underfunded for what was proposed. In fact it is useless for everything that was originally proposed.

      That is why it rapidly dropped from being a cycleway for the whole of NZ to being a set of unconnected “great cycleways”. Similarly the number of people employed on building it is reducing markedly. From memory it was originally intended to employ a few thousand people. That keeps getting reduced.

      Finally, in the usual nature of this useless government, it is un-costed, has had no effective cost-benefit analysis done, and has no scope. At this point they have no plans apart from allocating $50 million over 3 years (from memory) and an absolute determination to get something announced as starting by June 30th.

      The whole thing looks like it is simply being done to prevent clueless from looking like a mindless dork for proposing it off the cuff at the jobs summit.

      Have a look at No Right Turn. He has the cabinet papers released under a OIA. They make hilarious reading of how NOT to put a program in place. It appears that John Key aka clueless thinks that the taxpayers money is his to dispose of how he likes on stupid projects without the responsibility of accounting for the expenditure in advance.