Asia: Future Potential for the Norwegian Tourism Industry. Per Holte, Kjell Ellefsen Geiranger, December

Transcription

1 Asia: Future Potential for the Norwegian Tourism Industry Per Holte, Kjell Ellefsen Geiranger, December

2 Today s Agenda Asia at a glance Market data Asia Asian consumer trends Asian travel behavior Development of Asian travelers to Northern Europe Threats and Opportunities Case studies Potential development of season-extending business from Asia to the fjord region 2

3 ASIA AT A GLANCE 3

4 Asia at a glance: population About 60% of the world s population lives in Asia 6 out of the 10 world s largest countries are Asian countries World's Population by Area (2007) North America, 5.1 Oceania, 0.5 Africa, 14.5 Europe, 11.0 Latin America, Caribou, 8.6 Asia,

5 Asia at a glance: GDP per capita There is a GDP gap between Japan and the other Asian countries such as China and India. However, their GDP is rapidly increasing US$ Asian economy has shown signs of pick up since second quarter of 2009 GDP Growth Rate GDP per Capita Japan South Korea China India 15% 10% 5% 0% -5% Japan China Korea % -15% Q1 Q2 Q3 Q4 Q1 Q

6 MARKET DATA ASIA 6

7 Japan - Scandinavia Japanese Overnights in Scandinavia '08- ' Bednights Jan - Sep '08 Jan - Sep ' Denmark Norway Sweden 7

8 China - Scandinavia Chinese Overnights in Scandinavia '08- ' Bednights Jan - Sep '08 Jan - Sep '09 0 Denmark Norway Sweden 8

9 Korea- Scandinavia Korean Overnights in Scandinavia '08- ' Bednights Jan - Sep '08 Jan - Sep '09 0 Denmark Norway Sweden 9

10 US vs. Asia Bednights YTD Jan - Sep '08- '09 From USA/ Asia to Scandinavia USA Asia Jan- Sep '08 Jan- Sep '09 10

11 11 ASIAN CONSUMER TREND 11

12 Consumer trend: increasing affluent consumers Number of affluent consumers is increasing in Asia 56% live in Japan 20% live in China 20% 56% *People who have over NOK5.6 million financial asset other than housing, durables, valuable collections, etc. Source: Asia Wealth Report Merrill Lynch & Co., Inc. 12

13 Consumer trend: polarized consumption Increase of affluent consumer also means the widening of income gap Value products at reasonable prices High-priced product with high quality Package tours priced over NOK68,000 and even more expensive cruise tours are selling well among affluent consumers 13

14 Consumer Trend: polarization within individuals Consumers of affordable products and luxury products are often the same It is not unusual for a Japanese consumer to carry a NOK13,000 Louis Vuitton bag while wearing a NOK30 T-shirt This phenomenon can be seen among other developed countries in Asia, such as Korea, Taiwan and Hong Kong 14

15 What triggers Asian consumers to loosen their purse strings Narratives behind the products or experience It is important for Asian consumers that they can talk about their whole knowledge about their experience When they travel overseas, they study a lot about the destination prior to their travel Impressing narratives of the place or product, it would generate interest of Asian consumers 15

16 What triggers Asian consumers to loosen their purse strings Asians have a soft spot for the words limited and in season Something which can only be purchased on site Scenes which can only be seen in certain places and seasons 16

17 17 BEHAVIOR OF ASIAN TRAVELERS 17

18 Departure trend Japanese outbound market has been struggling since 2000 Korean, Chinese and Indian outbound markets have been growing steadily until : the global economic crisis hit Korea severely and the number of outbound travelers showed a sudden decrease million 20 Departures by Country 10 Japan Korea China India *China: Travelers to Hong Kong and Macau are excluded 18

19 When do Asians travel? Holiday seasons Major travel seasons: Japan: New Year in January, Golden Week in May and Summer vacation in August. Students travel in their Good holiday Spring vacation in March sequence in China: May and October are the popular seasons for October overseas travel 2009 Korea: Weekend trip to nearby destinations. Longer trips during summer vacation India: travelers prefer to visit overseas during summer season to get relief from the heat 19

20 When do Asians travel? Travelers to Norway Asian travelers visit Norway during summer season. Peak month for Korean travelers to Norway is in June, July for Japanese and August to September for Chinese travelers. Japan 2005 Japan 2008 South Korea 2005 South Korea ,000 25,000 Mid summer 12,000 10,000 Early summer 20,000 8,000 15,000 6,000 10,000 4,000 5,000 2, Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec China 2005 China 2008 The rest of Asia 2005 The rest of Asia ,000 8,000 Late summer 30,000 25,000 Mid summer 6,000 4,000 20,000 15,000 10,000 2,000 5,000 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov 20 Dec

21 21 DEVELOPMENT OF JAPANESE AND CHINESE TRAVELERS TO NORTHERN EUROPE 21

22 Who travel to Northern Europe? China: Japan: 1999: mostly official or business travelers, aged at and more than 75% are men 2008: younger travelers, ranged from 30 to 55, and female travelers share almost 50% 1999: mainly older men and women : younger travelers age

23 Rate of visitor repeaters China: By 1999, only 1st time traveler; by 2008, start to have 2nd time travelers Japan: More repeaters, mainly due to more younger travelers whom prefer visiting same destination many times 23

24 How do they travel? China: Package tour is still the major pattern, FIT is the emerging segment, but there is no FIT visa to Northern Europe (Denmark is implementing a semi FIT visa) Japan: Package tour 57.1%, FIT 39 % although FIT is increasing 24

25 What is the purpose of travel? China: Business travel, official visit, technical visit used to be main purpose of travel but now leisure travel makes up 70% (including soft technical visits ) Japan: Leisure travel 63.3 % Business travel 13.3% Honeymoon 6.7% Study trip 6.7% 25

26 How long did they travel? China: Mainly 8-14 days Japan: 60% 8-14 days 30% 5-7 days 6.7% 15 days or more 26

27 Trigger to choose North Europe? China: Recommendation from family/ friends 76% Internet SNS, BBS 55% Travel agency brochures 27% TV commercial 23% Japan: Travel agency brochures 43% Internet SNS, BBS 14% from family/ friends 10% TV commercial 6% 27

28 THREATS AND OPPORTUNITIES 28 28

29 Threat: increasing fuel surcharge Increase of fuel surcharge price started in 2008 Cheapest airfare from Japan to Europe around NOK3,200 Price likely to go up again in 2010 and discourage Japanese travelers to visit especially long-haul destinations JPY Fuel Surcharge Price to Europe 33,000 Yen b F e l. Ju a ṙ M l. Ju c ṫ O. n Ja. b F e ṙ p A a y. M l. Ju c ṫ O. n Ja ṙ p A l. Ju c ṫ O. n Ja ṙ p A l. Ju c ṫ O 29 29

30 Opportunities: Expansion of Haneda and Narita Airport Haneda: New runway will open in October The expansion enables additional 100,000 of takeoffs and landings, increase 80 new slots per day 40 slots out of 80 will be operated during midnight to early morning (23:00 to 6:00) mainly to longhaul destinations such as Europe and U.S.A Narita: The length of second runway of Narita airport will be expanded at the end of By this expansion, the number of takeoffs and landings will increase 20,000. Also, large aircraft will be able to use the second runway so that it is expected to have a good impact on long-hole destinations 30 30

31 Opportunities: Relaxation of charter flight regulations Japanese government relaxed charter flight regulations in 2007 and 2008 and became more flexible to make package tours by using charter flights. Major Changes: Application process to place the flight in service has simplified (especially for local airports) It s become possible to use third country aircrafts It s become possible to sell only air seats up to 50% Removal of the constraints of "obligatory stay in the foreign carrier's country exceeding 50 percent of the itinerary" 31

32 Opportunities: Most of Shin-Jinrui generation will become empty-nesters in the coming decade Shin-jinrui are the generation who were born during 1960s. (They are now in their 40s) When they were young, the Japanese economy was booming and they enjoyed active consumption such as shopping, traveling abroad, etc. At present, they are in a child-rearing period and cannot move as freely as they were young, choosing short-haul destinations for their child. However, they are still active consumers even in this economical situation and once their children become independent, it is expected that they start traveling to long-haul destinations again. 32

33 TOURISM SEASONALITY 33 33

34 Tourism seasonality: lessons learned Opening up infrastructure for longer season must be matched with suitable products Selling summer product in winter is not necessarily the answer People who visit in summer are rarely same people who could consider visiting in the winter Hence, rethink promotional efforts/content extremely important for out-of-the-normal-seasons expansion 34

35 Case 1: Greece Among top 15 in the world in tourism, but facing increased competition from other destinations in the region Successfully staged the 2004 Olympic Games 35

36 Case 2: Result Athens has become a hot new destination, largely because of its greatly improved infrastructure, the upgrading of hotels and the expansion of the Metro The Athens International Airport is recognized as one of the best in the world, and airports throughout Greece are being upgraded to handle increased traffic The national highway system connects the whole country in a well-designed network, and highway entries to Greece increased substantially in

37 Case 3: Öland, Sweden Öland has had a bridge to the mainland of Sweden since 1972 Before the bridge opened, there were around 300,000 people who visited the island every year In 1973, the figure was over a million 37

38 Case 4: The Travel & Tourism Competitiveness Index The TTCI lists infrastructure as one of the 13 factors a country s competitiveness is judged on The top 3, Switzerland, Germany and Austria, are described as having infrastructures that are among the best in the world India (65), China (71) are ranked low due in large part to poor infrastructure as are the rest of the countries at the bottom of the list 38

39 POTENTIAL 39 39

40 16000 Antall kommersielle gjestedøgn fra Asia per måned i 2007 (sept-des) og 2008 (jan-april) September Oktober November Desember Januar Februar Mars April Japan Kina Sør-Korea A sia ellers 40

41 14000 Antall kommersielle gjestedøgn fra Asia per måned i 2008 (sept-des) og 2009 (jan-april) September Oktober November Desember Januar Februar Mars April Japan Kina Sør-Korea A sia ellers 41

42 6000 Antall kommersielle gjestedøgn fra Japan per fylke per måned i 2007 (sept-des) og 2008 (jan-april) September Oktober November Desember Januar Februar Mars April Oslo Hordaland Sogn og Fjordane Møre og Romsdal 42

43 3500 Antall kommersielle gjestedøgn fra Japan per fylke per måned i 2008 (sept-des) og 2009 (jan-april) September Oktober November Desember Januar Februar Mars April Oslo Hordaland Sogn og Fjordane Møre og Romsdal 43

44 3500 Antall kommersielle gjestedøgn fra Kina per fylke per måned i 2007 (sept-des) og 2008 (jan-april) September Oktober November Desember Januar Februar Mars April Oslo Hordaland Sogn og Fjordane Møre og Romsdal 44

45 Antall kommersielle gjestedøgn fra Kina per fylke per måned i 2008 (sept-des) og 2009 (jan-april) September Oktober November Desember Januar Februar Mars April Oslo Hordaland Sogn og Fjordane Møre og Romsdal 45

46 700 Antall kommersielle gjestedøgn fra Sør-Korea per fylke per måned i 2007 (sept-des) og 2008 (jan-april) September Oktober November Desember Januar Februar Mars April Oslo Hordaland Sogn og Fjordane Møre og Romsdal 46

47 1200 Antall kommersielle gjestedøgn fra Sør-Korea per fylke per måned i 2008 (sept-des) og 2009 (jan-april) September Oktober November Desember Januar Februar Mars April Oslo Hordaland Sogn og Fjordane Møre og Romsdal 47

48 4500 Antall kommersielle gjestedøgn fra Asia ellers per fylke per måned i 2007 (sept-des) og 2008 (jan-april) September Oktober November Desember Januar Februar Mars April Oslo Hordaland Sogn og Fjordane Møre og Romsdal 48

49 4500 Antall kommersielle gjestedøgn fra Asia ellers per fylke per måned i 2008 (sept-des) og 2009 (jan-april) September Oktober November Desember Januar Februar Mars April Oslo Hordaland Sogn og Fjordane Møre og Romsdal 49

50 Forutsetninger i materialet: SSBs overnattingsstatistikk: Hotell: Alle hotell og lignende overnattingsbedrifter med mer enn 20 senger. Camping: Plasser med en kapasitet på enten minst åtte hytter eller en totalkapasitet på minst 50 enheter. Hyttegrend: Alle hyttegrender med en kapasitet på tre hytter eller mer. Vandrerhjem: 50

51 Potential development of season-extending business from Asia to the fjord region SEP, OCT, NOV: enormous potential, esp. SEP from Japan and OCT from China MAR: potential from Japan with student travelers Fairly good traffic to Oslo during the off-season that could be extended or diverted to the fjord region Statistics indicate a huge potential from Other Asia ; we have to pinpoint which these markets are 51

52 Comments from Japan "If the roads to and from Geiranger are open during the winter months, as well as the ferry route between Geiranger and Hellesylt, this would allow us to work harder on promoting and selling the Geirangerfjord region. This would especially hold true for the student holiday season of late March where we handle 130,000 pax (in 2008) to various destinations around the world (to Europe 10,000 pax). Some of these of course could potentially go to the fjords of Norway." - Mr. Tetsuro Aoki, division director and general manager Europe, JTB World Vacations, Inc. 52

53 Comments from Japan "We are in constant search for new destinations and products. If the Geiranger region should become accessible during the off-season, with the right and strong promotion towards the consumers, we do not see why it should not sell because we know the product itself has a high satisfaction ratio by our customers that visit Geiranger during the high season." -Mr. Hidenao Yoshizawa, Europe tour planning manager, Club Tourism International, Inc. 53