Why Tourism New Zealand must target China
In spite of the scary stories told in “Horror tales from Chinese tourists” in today's Business Herald, we must not lose sight of the potential of the Chinese tourism market. It was reported that Tourism Holdings will decide in the next month whether to keep pursuing the Chinese market. Graeme West of Tourism Holdings says “We can't be out there everywhere – we have to target where we think we can get the biggest bang for our buck. The market is there. But do we want the yield the market is providing?”
It makes commercial sense to target the market generating the highest returns. But I'm afraid that many tourism providers may be short-sighted in the same way that many language schools in the early 2000s were. Back then, the Chinese started to go overseas in huge numbers and many new language schools were opened here in a free-for-all. In the end, Chinese students stopped coming for a variety of reasons. One reason is the negative publicity that arose from adverse media reports. Cowboys in the market also did a lot of damage, by short-changing students. The Chinese began to be seen as a new goldmine, and scores of students had bad experiences with shoddy schools, greedy homestay parents, and unethical tourism providers. Understandably, ripped off students won't have good things to say about the New Zealand experience.
Many schools had to close down, and we have significant excess capacity to this day. Does that mean that China is a bad market to target? No. We're just getting punished for our short-sighted view of the market. There's a sense of deja-vu with what's happening in the tourism sector now. We can certainly learn from the experiences of the language school sector.
Chinese outbound departures more than doubled in the last five years, from 16.6 million people in 2002 to 40.9 million people in 2007. The number of affluent Chinese has increased dramatically, which bodes well for tourism. The China-New Zealand Free Trade Agreement and loosening visa restrictions are making it easier than ever for Chinese citizens to travel here.
The 2007 Neilsen China Outbound Travel Monitor Report indicated that Europe is the top dream destination for Chinese travellers, followed by Australia and New Zealand. Surely, at a time when the desire to visit New Zealand is so high, we need to be intensifying efforts to target this market, not cutting back. Rob Finlayson, manager at Tourism Holdings Limited (who looks after Rotorua's Rainbow Springs, Kiwi Encounter and Hukafall Jet boating),
was quoted as saying “All they do is the Agridome and Te Puia.” He says even if he cut his prices in half they still would not attract Chinese visitors because “at the end of the day they only have to include two paid attractions”.
Similar to various tourism providers, a number of domestic retailers are also responding in the same way. The word is there's no reason to focus on the needs of Chinese clients because there aren't many that buy. It begs the question: do you not have many Chinese/Asian clients because there aren't many around, or simply because you're not set up to deal with Chinese/Asian clients?
I don't know how we manage to conveniently forget that 1 in 5 residents are of Asian descent in the Auckland region.
Why is it that Chinese visitors have the lowest satisfaction levels (according to Tourism NZ data) of all those who visit this country? We need to talk to our clients to find out. But can we realistically do that if none of us actually understand the language spoken by our clients, let alone their culture?
Understanding the target market and taking a long term view of the value of the Chinese market is critical to success. We need to interpret our observations through the eyes of the Chinese. Let's not allow our perspectives to be so coloured by our cultural baggage that we fail to capitalise on significant opportunities.