Gold Coast 2ND ASPIRATION

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1 MARKET PROFILE Market overview In 215, Malaysia was Australia s seventh largest inbound market for visitor arrivals, ninth largest market for total visitor spend and 12th for visitor nights. Key importance factors for holiday destination choice 1 Safety and security 67% Value for money 44% Family friendly 36% $2.-2.5bn Potential to be worth by , Visitor arrivals 3 (á 4 per cent) World class nature 35% Food and wine 35% Aviation routes from Malaysia to Australia 2 Europe Holiday 57% Visiting friends & relatives 23% Kuala Lumpur Kota Kinabalu Darwin Business 7% Education 7% Perth Gold Coast Sydney Adelaide Melbourne $1.1bn Total spend 4 (á 7 per cent) Which airlines 3 do Malaysian visitors use to travel to Australia? 26 *4 8 **4 Airline Air Asia X 42% 48% 49% 53% 47% Malaysia Airlines 32% 31% 32% 3% 33% Singapore Airlines 12% 8% 6% 5% 5% Emirates 4% 3% 3% 3% 4% Scoot % 2% 2% 2% 2% Others 11% 8% 8% 8% 9% Purchase funnel 1 In Malaysia, Australia ranks a close #2 to Japan on aspiration and awareness and overtakes Japan on intention to achieve the #1 rank. Australia s ranking falls slightly to #4 on a visitation basis, behind China, Hong Kong and Taiwan. Japan follows at #5 for visitation, with lower conversion from high aspiration and awareness. 2ND ASPIRATION 2ND AWARENESS Average nights stayed Median nights stayed Feb-Mar and Sep Booking peak period Lunar New Year, Jul and school holidays Travel peak period 1ST INTENTION 4TH VISITATION Notes:*Average nights: the sum of all nights divided by the sum of all visitors. **Median nights: represents the midpoint length of stay for which 5% of visitors stay less and 5% stay longer. Data refers to an average of Refers to share of arrivals of respective purpose. Sources:1.Tourism Australia, Consumer Demand Project, Department of Infrastructure and Regional Development, December Department of Immigration and Border Protection, December Tourism Research Australia, International Visitor Survey, December MALAYSIA Market Profile 216

2 MARKET PERFORMANCE The charts on this page provide a trend overview of visitor arrivals and spend over the last 1 years by main purpose of visit, by first time and repeat leisure Δ visitors and also a snapshot of age demographic split of leisure visitors and spend. Visitor arrivals 1 Visitor spend 2 Visitor arrivals (s) , Total trip spend ($bn) $1.1bn. Visitor arrivals by main purpose of visit 1 Visitor arrivals (s) Visitor spend by main purpose of visit 2 Holiday Visiting friends or relatives Education Business Employment Other Total trip spend (A$s) Education Holiday Visiting friends or relatives Employment Other Business First and repeat leisure visitor arrivals 2 First and repeat leisure visitor spend Visitor arrivals (s) Return visit First visit Total trip spend (A$s) Return visit First visit Leisure arrivals by age 2 Leisure spend by age 2 6 yrs & over 16% 6 yrs & over 15% yrs 33% yrs 24% yrs 44% yrs 18% 3 44 yrs 27% 3 44 yrs 23% Notes: Δ Leisure refers to main purpose of visit of holiday and visiting friends and relatives. Age profile data refers to an average of Sources: 1. Department of Immigration and Border Protection, December Tourism Research Australia, International Visitor Survey, December MALAYSIA Market Profile 216

3 MARKET PERFORMANCE The following table provides a summary of arrivals, spend and the proportion of repeat visitors to Australia by main purpose of visit: holiday, visiting friends and relatives, business and education. HOLIDAY VISITING FRIENDS AND RELATIVES BUSINESS EDUCATION Arrivals 1 162,2 (57% ) 65, 8 (23% ) 18,4 (7% ) 19,7 (7% ) Spend per trip 2 $2,45 $2,46 $3,397 $18,789 Spend per night 2 $226 $123 $28 $13 Repeat visitors 2 6% 85% 74% 87% Average nights stayed Median nights stayed The following provides an overview of top 1 regions visited by leisure visitors* Top 1 regions visited by leisure visitors * 2 Melbourne 39% Perth 26% Sydney 25% Gold Coast 12% Brisbane 7% Adelaide 5% Australia s South West, Western Australia 3% Hobart 2% Western Victoria 2% Canberra 2% Notes: o Data refers to an average of Refers to share of arrivals of respective purpose of visit. Top 1 regions visited data refers to an average of Percentages will not add to 1% as one person can visit multiple regions. The data refers to visitors who spent at least one night in the region. * Leisure refers to main purpose of visit of holiday and visiting friends and relatives. Sources: 1. Department of Immigration and Border Protection, December Tourism Research Australia, International Visitor Survey, December MALAYSIA Market Profile 216

4 AVIATION LANDSCAPE In 215 direct capacity from Malaysia to Australia declined 19 per cent after strong growth recorded in previous years. Despite the capacity decline in 215 as the two key national carriers, Malaysia Airlines and Air Asia X went through restructuring and rationalizsation of their routes, capacity between Malaysia to Australia was still eight per cent higher compared to 213. In late 215, Malindo Airlines commenced operations between Kuala Lumpur and Perth. With arrivals from Malaysia still growing steadily, average loads during 215 improved two percentage points to 76 per cent. Outside the peak of Australian holiday periods (January, July, and October) and Lunar New Year (January/February), load factors were relatively low (hovering between 6-75 per cent). Eighty per cent of visitors chose to fly Malaysia Airlines and Air Asia X to Australia in 215, down three percentage points compared to 214. With the capacity cuts by both airlines, some share was expected to be captured by other carriers. The ASEAN single market agreement, which is expected to fully liberalise air travel between member states in the ASEAN region, has been an ongoing negotiation. However, there are hopes it could be finalised in the near future. Once the agreement is ratified by all members, demand is expected to be diverted away from Australia in the short term as intra-asian travel is stimulated. Direct aviation capacity from Malaysia to Australia 1 12 Seats per year (s) Malaysia Airlines AirAsia X 2 Jetstar Weekly services to Australia 2 Operating Airlines Flights per week Route Alliance/ code share partner (on route) Malaysia Airlines 4 Kuala Lumpur Adelaide KLM, Sri Lankan Airlines 14 Kuala Lumpur Melbourne 14 Kuala Lumpur Sydney 7 Kuala Lumpur Perth KLM, Sri Lankan Airlines, Qatar Airways 3 Kuala Lumpur Darwin Japan Airlines 1 Kota Kinabalu Perth AirAsia X 12 Kuala Lumpur Melbourne 11 Kuala Lumpur Perth 14 Kuala Lumpur Sydney 5 Kuala Lumpur Gold Coast Malindo Air 11 Kuala Lumpur-Perth Emirates 7 Dubai-Kuala Lumpur-Melbourne Sources: 1. Department of Infrastructure and Regional Development, Aviation Statistics, December Department of Infrastructure and Regional Development, International Airlines Timetable Summary (Northern Winter), MALAYSIA Market Profile 216

5 PLANNING AND BOOKING INFORMATION SOURCES The following charts highlight the information sources that Malaysian consumers use to plan and book their holidays. Preferred sources for early planning and inspiration General internet searching 37% Friends or relatives who have been before or live there 35% Travel or guide books 34% Online and social media photos and blogs 31% Online travellers opinions and reviews 28% Airline 25% Brochures 24% Online flights booking site 24% Online hotel booking site 23% TV programs 22% Preferred sources for seeking information about Australia specifically Friends or relatives who have been before or live there 39% General internet searching 35% Travel or guide books 29% Online and social media photos and blogs 28% Airline 26% Online flights booking site 23% Accommodation/activity/experience provider websites 21% Online hotel booking site 21% TV travel programs 19% Brochures 19% Preferred sources used to book a holiday to Australia Directly through airline (online) 38% Travel agent (telephone or in person) 31% Accommodation provider (online) 24% Other travel booking website 18% Travel agent (online) 15% Directly through airline (telephone or in person) 15% Accommodation provider (telephone or in person) 12% Other online source 9% Tour operator (telephone and in person) 8% Tour operator (online) 6% Source: Tourism Australia, Consumer Demand Project, MALAYSIA Market Profile 216

6 DISTRIBUTION Online bookings are growing rapidly in Malaysia amongst the Free and Independent Traveller (FIT) segment, particularly for flights, accommodation, car rental, day tours and attraction entry passes. The online environment is providing consumers with extensive destination information, and the ability to conduct price comparisons. Social media is also fast gaining popularity with Malaysians for sharing information. The distribution system has become more complex as consumers use a combination of traditional and online channels to plan and book travel. The preference for last minute travel purchases remains entrenched for most Malaysian travellers. Distribution system Wholesalers/ Large Agencies Commission Level: 1% to 15% There is no formal distinction between wholesalers and retails agencies. A few large travel agencies such as AD Travel, Airlink Travel, Golden Deluxe, Golden Tourworld, LKW Travel, Malaysian Harmony, PNL Travel and Reliance take reservations from consumers through their own retail network. Some also take reservations from smaller travel agencies which have limited access to inbound tour operators (ITOs) and do not undertake consumer advertising. Retail Agents Commission Level: 5% to 1% There are approximately 1,3 retail travel agencies in Malaysia, with more than 3 agencies selling Australian products and packages. The majority of agencies are small to medium sized, independently-owned enterprises. Around 2 key agencies partner with Tourism Australia and State and Territory Tourism Organisations (STOs) in marketing campaigns. With increasing interest from the Free and Independent Traveller (FIT), more travel agencies are organising their own tour packages to meet customers needs and demands, rather than relying solely on packages developed by the larger agencies and ITOs. Familiarity with Australia and active engagement by State and Territory Tourism Organisations, ITOs and Australian suppliers has made Australia a very modular destination. This has enabled many small travel agents to offer their own holiday packages to specific destinations within Australia for leisure, incentives and semipackaged FIT trips. Packages for international sports and events are growing for Malaysia visitors, particularly the Gold Coast Marathon, Vivid Sydney and Melbourne Food & Wine festival. Aussie Specialists The Aussie Specialist Program (ASP) is the primary platform for Tourism Australia to train and develop front line travel sellers to best sell Australia. As at April 216, there were 375 qualified Aussie Specialists in Malaysia. The majority of agents are located in the Klang Valley (Kuala Lumpur and surrounds), Penang, Ipoh, Johor Bahru, Kuching and Kota Kinabalu. Online All major retail agencies have an online presence, and online business is growing. However, the number of direct consumer enquiries and visits to offline agents still remains high. Inbound Tour Operators Commission Level: up to 2% Key Online Travel Agencies include Expedia, Lastminute.com, Priceline, 12Fly and PYO. Airline sites are increasing in popularity for flight and accommodation bookings, especially those with popular services to Australia such as AirAsia X, Malaysia Airlines, Singapore Airlines, Emirates, Scoot, Tiger Airways and Jetstar. Inbound tour operators (ITOs) remain a key link in the distribution of product in the Malaysian market place. However, there is a noticeable trend to direct deals with hoteliers and operators, in particular for accommodation and day tours. ITOs also handle a large proportion of FIT and non-group itineraries. 6 MALAYSIA Market Profile 216

7 DISTRIBUTION Trends Planning a visit to market Distribution The increased competition in the Malaysian aviation sector has resulted in: > > Travellers becoming increasingly price sensitive as airlines offer competitive airfares on a regular basis. > > Travellers booking airfares online, due to attractive website promotions and increasing acceptance of online purchasing. > > Some travellers planning and purchasing earlier, especially in the FIT segment, to take advantage of early bird airfare deals and promotions. Due to competitive pricing, group package tours are still the basis for outbound travel for new destinations. For repeat visitation, FIT travel is more common. There is increased consumer interest in the cruise market. Major cruise lines operating in Malaysia are Royal Caribbean Cruise, Princess and Star Cruise. Consumer travel fairs organised by the Malaysian Association of Tour and Travel Agents (MATTA) occur in March (Kuala Lumpur, Ipoh and Johor), July (Penang), and September (Kuala Lumpur and Ipoh). There are also additional consumer travel fairs organised by the Malaysian Chinese Tourism Association (MCTA/ MITM), which occur in July (Penang & Johor) and August (Kuala Lumpur). Planning and purchasing travel Consumers in Malaysia are value conscious and actively review a range of destinations and information sources, seeking favourable deals before making travel purchases. There are a significant number of consumers who will purchase airfares directly from airlines and secure ground arrangements later. Malaysia is a mature market and consumers have a solid knowledge of Australia. Top tips for sales calls Malaysian travel trade partners value personal relationships and loyalty. Persistent visits and contact can assist in this process. Tourism Australia has an office in Kuala Lumpur. Make your first call to the Tourism Australia office to receive the latest market information and provide a product update. Avoid sales calls on Monday and Friday mornings and a week prior or during major holidays, school holidays and travel fairs. Malaysian travel trade partners prefer printed collateral and high resolution images on a USB drive. Value-add or competitive pricing offers during the low season travel period (March to August) are useful to trigger tactical campaigns with travel agents in particular consumer travel fairs in March. The best time of year for sales calls is after Chinese New Year, April and June to October. The key market centres to visit are Kuala Lumpur and the Klang Valley, which accounts for 65 per cent of outbound travel to Australia. The key secondary markets are Penang, Ipoh and Johor.»» For more general information on sales calls and planning a visit to market, please see Tourism Australia s Planning for Inbound Success ebook at inboundsuccess 7 MALAYSIA Market Profile 216

8 DISTRIBUTION Key trade and consumer events Event Location Date MATTA Travel Fair Kuala Lumpur, Malaysia 2-4 September 216 Corroboree Asia Perth, Australia 5-9 September 216 Australian Tourism Exchange (ATE) Sydney, Australia May 217 Where to find more information Tourism Australia s activities in Malaysia are managed from its Kuala Lumpur office. For more information, visit Tourism Australia s corporate website at Tourism and Events Queensland also operates in Malaysia. Also see: Malaysia Country Brief published by the Department of Foreign Affairs and Trade at: For the latest arrivals statistics, visit: For additional statistical reports refer to the Australian Bureau of Statistics (ABS) and Tourism Research Australia (TRA) websites: and Contact Level 29, 42 George Street Sydney, NSW, 2 Telephone: ask.us@tourism.australia.com Corporate: tourism.australia.com twitter.com/tourismaus Consumer: australia.com twitter.com/australia facebook.com/seeaustralia 8 MALAYSIA Market Profile 216