atx: taking Australian Tourism to the World by BeContent

Quarterly, Issue 3

$6.95

December 2006

www.atxmag.com.au

sky wars

Whose side is The Force on? fuelling fear Petrol prices bring mixed feelings for tourism

tourism

american psyche

The changing mindset of the US traveller

the interview

Tourism Australia’s new MD

is everyone’s business

no vacancy

the state of Australia’s top-end hotels

licensing

generationY It’s all about them

The wrangle over red tape

The magazine of Australia’s inbound tourism industry: an official Australian Tourism Export Council publication

N\Ëi\ [i`m`e^ pfli Zljkfd\ij Xe[ Ylj`e\jj% Thatʼs Thrifty Thinking. Visit www.thrifty.com.au or call 1300 367 227.

atx: d atx: from the MD

atx: thecontent yoursay theinterview

Geoff Buckley

skywars Whose side is The Force on?

fuellingfear

Petrol prices bring mixed feelings for tourism

tourismiseveryone’sbusiness

Dear industry colleague

Foreign tourists boost business coffers

As we come to the end of 2006, it is time to take a few minutes for reflection. This year has been an incredibly busy one for our $18 billion tourism export sector. Despite ongoing global uncertainty, the inbound travel market continues to grow as travellers realise there is no longer any such thing as “normal”. This year has seen record increases in fuel prices create a challenge for our industry while climate change is fast becoming one of the key issues to be addressed by governments around the world as its ramifications ripple across all business sectors – particularly ours. But despite these challenges, people continue to travel – and in fact are travelling more than ever before – something we should take extreme heart in. Although the 2006 figures were not available at the time of going to print, it looks as though Australia, while visitor growth has slowed somewhat, will hit the more than 5.5 million visitor mark for the year. The real bright light however, is that travel expenditure continues to rise as visitors stay longer and spend more.

novacancy

The state of Australia’s top-end hotel market

licensing

The wrangle over red tape

usefulstuff

The art of communication

theinterview

Katrina Hodgkinson

ATEC annualreport

The year in review

americanpsyche

The changing mindset of the US traveller

This third edition of atx: is a special one. There is no doubt that the magazine is growing from strength-to-strength as it finds its niche in the tourism and travel industry. We have our strongest issue ever covering as always, the topics that are, or should be, top of mind for our members, partners and stakeholders. Our cover story “Sky Wars” looks at the changing face of Australia’s aviation industry as it become ever more cutthroat; we look at how increased fuel prices have affected the traveller’s psyche; we delve into what makes the elusive “Gen Yer” tick; and we make a critical examination of the tangle of regulatory red tape many of our members find themselves in. This issue’s market focus is on the US and how it has changed five years on from September 11; we interview NSW Shadow Tourism Minister Katrina Hodgkinson; and we are one of the first to talk to new Tourism Australia MD, Geoff Buckley. We also look at the state of the hotel industry and pay tribute to the late Steve Irwin. Our popular spotlight series continues with a feature on North Western Australia and on industry stalwarts Max Shepherd and Geoff McGeary. We also take a look at where we have come from with the first of a series of history pieces on our industry. This issue includes a special ATEC Annual Report insert which examines how we, as an organisation, have been tracking during the past year. As always, your feedback and suggestions on this and future issues of atx: are welcome and appreciated – this is your industry magazine. Matthew Hingerty Managing Director Australian Tourism Export Council

researchsnapshot

The US market

tribute

Steve Irwin

generationY

It’s all about them

casestudy

Trading in knowledge

whathappensontour…

Postcards from the road

spotlight

Australia’s North West

history

Charles Holmes: Pioneer of Promotion

guestcolumn Robbie Bastion on The Joy of Travel

tourismhero

Max Shepherd

advertisingdirectory usefulstuff

Online money

03 04 08 12 16 20 24 29 30 31 40 44 46 48 52 54 56 58 60 62 66 68

atx: is published by Sampson Communications Australia on behalf of the Australian Tourism Export Council. editorial

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atx: yoursay

“What are your thoughts on introducing a tourism industry development levy to fund new initiatives?” “It will make a huge impact on tourism and may cause the loss of future business because of: - already, long-haul destinations are suffering from the oil surcharge and loss of business - there is no country which has this type of levy - the reason for this levy would not be understand by the consumer - who collects it and how it would be collected cannot be regulated - how and by whom will this levy be used? For so many reasons, we cannot justify this levy and give more reasons to jeopardise inbound tourism.” Yoshimi Kobayashi, Senior Director Inbound Jalpak International Oceania Pty Ltd

“Unlike some other industries, which have large industry bodies and large companies dominating them, the tourism industry is made up chiefly of small operators. Hence, if this would be a levy charged to the suppliers in the industry, it would be very costly to collect, possibly more costly than the revenue it would raise. If the levy were raised from the consumers of the tourism industry, it would be equally difficult for the same reason. The only other option would be by applying it through key spend nodes such as a departure tax. Since tourism is already very heavily taxed, an additional levy would only harm the industry. What is more important is that the taxes collected from the tourism industry - via GST, passenger movement charges, fuel tax etc - is redistributed and reinvested into the tourism industry. “

atx: contributors

Henrik Berglind, Director of International Sales Europe and South Africa Accor

“The concept of a levy of some kind for the tourism industry in Australia is long overdue. For years, everyone else around the tourism industry has been “clipping the ticket” so to speak. In fact, if you think about the inbound tourism industry, a portion of the industry clips the ticket in some kind, but the funds either flow to the government or to a shareholder. All operators, regardless of the sector in which they operate, are the real shareholders of the tourism industry and it is about time there was some kind of mechanism in place to provide professional bodies with real funds to develop our industry. You would think with an industry as diverse, professional and profitable as ours we would be able to agree on a way in which a levy could be developed, implemented and then used. A levy, however it was constituted, needs to be collected at the source. It needs to be administered by official means and must have federal government support.

and territory whose charter is to foster the growth of industry....how do they fit in? Let’s assume we can actually collect the money....then what? I can see the arguments now... it should be spent on developing regional destinations to encourage tourism, no, no the airline sector is the future - it should be spent on marketing destinations that are serviced by air, or why not a TV campaign to tell everyone they should be taking a holiday? Let’s face it folks, industry levies work when the industry concerned is well-organised, works cooperatively, and has a plan. It also helps to have the respect and ears of senior government bureaucrats and politicians. When we get to that point rather than dividing and conquering ourselves by state, region, sector and product I may support a levy...hell, I’ll put the first $1 in.” Michael Leary Head of Travel & Touring NRMA Motoring & Services

The best part of having funds is that an industry-based strategic plan can be developed and in doing this, great cooperation within the industry will follow and real deliverable outcomes will be achieved.” Jayson Westbury, CEO Directions Conference and Incentive Management

“A tourism development industry levy - nice idea. Now let’s look at the implications....... Are we going to place another tax on the travelling public to fund this initiative or are we as an industry prepared to pay for our own future? I’ll bet we’re not. Actually, don’t we have government departments in each state

go online and have

yoursay www.atxmag.com.au

Allan Leibowitz is a former editor of Business Queensland and the Australian Travel Reporter. He now specialises in business travel, and edits the specialist publication, Business Travel Monthly.

Kerri Anderson began her career as a newspaper journalist, and has extensive experience in tourism marketing and corporate communications. As National Media and Communications Manager of ATEC, Kerri describes atx: as one of the most rewarding projects she has worked on.

Sam Tinson was a features editor and photographer at a London news agency. Now based in Sydney, he spends his time writing and photographing for News International, GQ, Vive, Luxury Travel and Wheels, and drafting smug emails to his friends back home.

Graham Readfearn is an award-winning freelance journalist and feature writer. He emigrated to Brisbane in December 2005 and has written for The Courier-Mail and its Saturday magazine QWeekend.

Julie Fison spent 15 years as a television reporter in London and Hong Kong, before returning to Australia and pursuing feature writing. She is a contributor to The Australian, the Australian Financial Review and Australian Traveller.

Ben Sandilands has reported airline affairs for 36 years. His contributions appear in The Australian Financial Review, Aviation Business Asia Pacific, and overseas publications served by the Guardian & Observer news service.

John Richardson has awards for journalism and tourism. In journalism he was both foreign correspondent and foreign editor. In tourism he directed Australian Tourist Commission operations in North America before taking charge of its worldwide marketing as Assistant General Manager.

David Carroll is one of Australia’s most experienced travel industry journalists and commentators. He has almost 15 years’ experience reporting on domestic and international travel businesses, including more than a decade editing award-winning travel industry journal Traveltrade.

Robbie Bastion commenced a career in sales and marketing which has involved over 50 international sales trips; these trips formed the basis for the publication of his first book, In Continents. He continues his travels as the Director of International Sales for Parker Travel Collection.

Lee Mylne is a Melbournebased freelance journalist who has specialised in writing about travel and tourism for a range of consumer and trade magazines around Australia for the past 15 years.

Sheriden Rhodes is an experienced and awardwinning travel writer and photographer. She has been a journalist for 17 years, having worked on both newspapers and magazines and was previously an editor for travel trade.

Anders Lindström is a freelance journalist writing for a wide spectrum of magazines and newspapers. He is also a media consultant to several travel companies. Anders is the former features editor of Travel Week.

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atx: theinterview atx: theinterview

Geoff

Buckley

A quick scan of Geoff Buckleyâ&#x20AC;&#x2122;s CV and one could be forgiven for thinking Tourism Australiaâ&#x20AC;&#x2122;s new Managing Director might be more comfortable behind a computer than in front of the cameras.

David Carroll is one of the first to speak with the new MD

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atx: geoffbuckley Since October 2004 Geoff Buckley has held the role of Director, Strategy and Research at Tourism Australia and in a career spanning more than 20 years, he has undertaken a variety of positions focused on tactics, planning and policy. Among them was a stint as Executive Director Research and Development for the Australian Tourism Industry Association; time as Tourism New South Wales’ Director of Strategy and Alliances; and a research role at the Australian Bureau of Statistics. In the late 1980s, 54-year-old Buckley - who grew up in Sydney and holds a Bachelor of Economics from the University of New England, Armidale - lectured at the University of Technology Sydney, establishing the university’s undergraduate degree in Tourism Management. A strong emphasis on research is certainly something he believes is necessary if Tourism Australia’s innovative marketing skills are to influence a crowded marketplace. “The enormous amount of competition Australia now faces means there are a lot of external factors influencing performance,” Buckley says. “Clearly we need to be ahead of the game in terms of having a clear understanding of what’s happening in a dynamic marketplace.” He also thinks the delivery of market intelligence is where Tourism Australia can add most value on the domestic front. “Seventy percent of Australia’s tourism is domestic and ATEC members have a strong domestic base. We recognise the challenges and the role we have been playing is to identify what’s happening and why. “The domestic market has not had access to that kind of information in the past. “So we want to bring an international approach, with research, insights and content development.” While strategy is a strong suit, Buckley has plenty of hands-on marketing experience. He was Director of Marketing at Tourism NSW in the lead-up to the Sydney 2000 Olympics. Immediately prior to joining

Tourism Australia, he was Executive Director of Marketing and Communications for Sydney Olympic Park Authority (SOPA), which saw him involved in everything from hosting the Rugby World Cup to promoting drive-in movies in a car park - all part of SOPA’s efforts to turn the Olympic facility into a vibrant leisure and commercial precinct.

promotion, developing products and enhancing air access – is the correct approach to addressing the downturn in the Japanese market.

There is certainly nothing pedantic or bookish about Buckley’s demeanour. He’s no slick, silver-tongued marketing man, but in person is articulate, open and approachable – all characteristics he would like ascribed to Tourism Australia under his tutelage.

“We have just undergone some structural changes, with the establishment of a Continental European office [in Frankfurt]. So I don’t think any further significant adjustments are necessary.

He is also determined that the organisation puts recent controversies behind it – including the sudden and dramatic exit of his predecessor – and gets to work implementing a sound strategic plan. “We have worked hard to create a clear strategy and we are comfortable with that direction,” he says. “My appointment also signals the board’s support for that strategic direction. We are now in implementation mode and improving the way we deliver, with resources being stretched across the board. “We are in 22 markets and we need to make sure we stay focused.”

In terms of Tourism Australia’s organisational structure, he foresees only incremental changes in response to specific challenges.

“Having said that, we need to be as flexible as possible, so there will be continuous adjustments, but they will not be significant.” One area he does see room for improvement, however, is in the building of relationships across industry and government. “An enormous amount of effort goes into building up a major campaign like ‘Where the bloody hell are you?’, so we were a bit inward focused on getting the job done,” Buckley says. “We did it well, and now is the time to make partnerships to take us forward and interface with those stakeholders in a positive way.”

“An enormous amount of effort goes into building up a major campaign like ‘Where the bloody hell are you?’, so we were a bit inward focused on getting the job done,” Buckley says. Buckley reiterates his commitment to the ‘Where the bloody hell are you?’ campaign, which he claims is effectively cutting through the competitive clutter and delivering “something unique about Australia and what it offers”. Nor does he see the need to change Tourism Australia’s tiered approach to international inbound source markets, with its primary focus on the ‘top seven’. ( New Zealand, UK, Japan, US, Germany, China, South Korea) Tourism Australia will also continue to direct its energies into growth markets such as China and Korea, while developing secondary markets such as Canada, where the organisation opened an office in late 2005. Buckley says he is also satisfied the Action Plan on Japan – with its focus on

One solution, he says, is to take a more structured approached to developing and maintaining lines of communication with suppliers. With that in mind, Tourism Australia established a Partnership Marketing business unit earlier this year, with staff positioned within state tourism offices in NSW, Victoria, South Australia and Queensland. “Our people on the road are now touching base with industry players and gathering feedback on the issues that industry faces,” he says. “It is about taking a more proactive approach. And it works both ways, because those people provide the industry with a connection to our research and market intelligence.” atx:magazine:yearbook2006

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Whose side is The Force on? Whoever ends up owning Qantas will need to break free from the limitations imposed on foreign ownership, argues Ben Sandilands The initial excitement caused by the Macquarie Bank/TPG play for Qantas brought out some very trite and unhelpful comments from political figures on both sides of parliament. The over-simplified comments about keeping the kangaroo on the tail, protecting a national icon, and saving Qantas from foreign control all played to the popular audience, and sold the interests of our

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industry, as well as Qantas, very short. Whether the particular deal put forward would prove to be in the best interests of Qantas raised some important, even alarming questions. But there is no doubting that Qantas cannot realise its full potential as a global player unless it can play by globally competitive rules. Things have to change. The die that was cast in 1992 was the well-intentioned but fatally flawed Qantas Sale Act. While it quickly turned Qantas into one of the most successful airlines in the world, it guaranteed (in the absence

of protectionist interventions) its medium term failure. Although the managements led by James Strong and his successor and current CEO, Geoff Dixon, have constantly drawn attention to these flaws in the Act, their comments have only gained intermittent traction in politics and the media up until the shock of the private equity bid. The main flaw, which caps foreign equity at 49 percent of shares, condemns Qantas to borrowing money that its global competitors, and Virgin Blue, can essentially get interest-free through equity placements. This is an oversimplification but it is the heart of the matter. There are other

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elements of unfairness in the Qantas Sale Act, but the core problem is that Qantas is charged with being a player on a global field, yet forced to abide by a perverse set of Australian rules. No other crucial Australian exporter, nor any other Australian airline, is hamstrung by the capital raising restrictions that were imposed by the Keating government for the noble purpose of “keeping Qantas Australian.” This vision guarantees that it will either fail in a ruthlessly open market, or require protection by governments in the form of restrictive access policies that will of course, ultimately prevent inbound tourism from realising its full potential. The current government should be dealing with these absurdities, but stubbornly refuses on the grounds that the electorate might perceive it is “letting Qantas fall into foreign hands”. Nothing could be further from the truth. If it doesn’t change, current government

policy eventually means that all international services to Australia will fall into foreign-controlled hands. The lucid yet simple campaigns being run by Emirates and Singapore Airlines for greater access to the Australian market make it high time to inform and perhaps change these perceptions. This is not about discouraging the enormous contributions that these two carriers make to the inbound tourism industry, but to allow Qantas to be as good as it can be in its competitive responses. This will ensure that through the survival of a strong Australian flag carrier, such issues as capacity, frequency and choice of gateways will not be decided in foreign board rooms and taken away or varied according to criteria which will not include the Australian interest, but reflect their own country of origin’s interests. The president of Emirates, Tim Clark, recently captured the attention of the tourism and aviation sectors by suggesting that his airline – the world’s fastest growing

– had identified sites for around 30 luxury eco-resorts in Australia similar to its Wolgan Valley investment on the western side of the Blue Mountains. The implication was clear. If a single resort in the Hayman Island class could generate enough high-yielding international visitors to fill every first class cabin to Sydney for several days each week, what might another 29 of them do for the industry at large? To fairly sum up Mr Clark’s message, it was that “very good things will happen to Australian tourism” if Emirates is allowed the greater access to our market that it desires. It is a message that is of compelling interest. And Emirates is a generous contributor to inbound tourism through the rising power of the connections it offers over its Dubai hub, including the distinctly different eastern and western African markets, secondary even tertiary cities in Europe that no airline, including Qantas, has ever linked to Australia on a atx:magazine:yearbook2006

atx: coverstory comprehensive multi-daily basis using their own jets. This message also comes on top of the campaign for trans-Pacific access for Singapore Airlines. The core element in each is that if allowed the access they seek, they will provide rates of growth and added depth to inbound tourism that are beyond the resources of Australian flag carriers on their own. However, Qantas and the nascent longhaul ambitions of Virgin Blue are not on their own. This situation also poses enormous risks for our industry and exposes the dilemmas caused by longstanding flaws in the aviation reform policies that began to flow through the airline and tourism sectors almost two decades ago. Do we have to â&#x20AC;&#x2DC;sacrificeâ&#x20AC;&#x2122; Qantas to get more visitors? Of course not. The very best result would be to allow a Qantas that will always be Australian managed and significantly Australian owned to offer all its shares to offshore and onshore institutions and individuals, and remain committed to reciprocating fair and

This situation poses enormous risk for our industry and exposes the dilemmas caused by longstanding flaws in the aviation reform policies. competitive access to our aviation markets to other players. The consequences of the repeal or reform of the Qantas Sale Act would be far more overseas interest in Qantas as a quality

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atx: skywars There is no doubting that Qantas cannot realise its full potential as a global player unless it can play by globally competitive rules. Consider a few impending developments. Emirates intends to replace all of its current Australian and New Zealand services in the medium term with Airbus A380s. The current Emirates timetable uses 18 jets at high rates of utilisation. Qantas has 20 of the giant Airbuses on order, but has to spread them not just over the kangaroo routes to Europe (where Emirates is developing deep penetration through both major and minor cities) but across the Pacific, where Singapore Airlines seeks a ‘token’ daily service, and will have at least 19 A380s with which to service its trunk routes. Despite the delays to the A380, the ambition to migrate services from 330seats to 480 or more seat configurations in the biggest jet ever built within seven to ten years is supported by the rolling 20year Commercial Market Outlook forecasts by both Airbus and Boeing.

By 2023 international traffic to Australia is forecast to more than double overall and actually treble on key routes. While the expansion of the leisure and business markets between Australia and India, China and our other nearer trading partners will substantially recast the shape of the overall market. If Qantas is to attempt to fund its new airliners, replace aged fleet, invest in better systems and surpass the product initiatives of its fiscally free competitors, it has to fly under the same rules as far as that is possible. Australia may never have the negligible tax regime of the United Arab Emirates, and perhaps not even the generous and sensible depreciation advantages of Singapore Airlines, but its airlines would be able to maintain and exploit the value of their brands far more readily with open access to equity.

However, if nothing is done, the politically expedient route of suppressing tourism growth to appeal to popular expectations of protecting Qantas or Virgin Blue will end up confining the growth, value and profitability of the carriers, and deprive Australia of full participation in global tourism. The linkage between the health of our industry and its air services is inescapable, but difficult to enunciate in the slogandriven shallowness of democracy by vox populi on talk back radio, online media and television. Even though Virgin Blue’s US flights will start with only a small fleet of aircraft, they will enjoy an advantage over Qantas that will become very important over time - its controlling stakeholder, Toll, can raise all of its foreseeable capital needs without the limitations of an equity cap either on its principal sources of revenue, or purely for a subsidiary which is the alternative Australian flag carrier. There are crucially different drivers behind the ambitions of Emirates and Singapore Airlines. Emirates has been flying for 20 years, doubling in size every 3.5 years in its first decade and a half. It has now ‘slowed’ to doubling every four years. Its role is to be

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atx:coverstory To fairly sum up Mr Clark’s message, it was that ‘very good things will happen to Australian tourism’ if Emirates is allowed the greater access to our market that it desires. Qantas CEO Geoff Dixon is particularly interested in the example set by the Air France/ KLM merger, which retained two brands and service cultures but created one set of shareholders.

Qantas CEO Geoff Dixon is particularly interested in the example set by the Air France/ KLM merger, which retained two brands and service cultures but created one set of shareholders. the flag carrier for the biggest airline hub on earth - Dubai - by around 2015, from where today’s best long-range aircraft can reach any other airport non-stop. The Wolgan Valley property is, on a small but superb scale, doing the same thing. Emirates is installing demand for its premium product with a network of low impact high quality eco-resorts around the world. Yet it competes with more than 2.5 times as many foreign airlines through Dubai as Qantas does in Australia. Singapore Airlines on the other hand is dealing with the limits of growth in its home market and the economic shift of gravity northwards into China that is to an

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extent, reducing the future prospects of Changi as a hub. Even though Qantas was unable to find a jet capable of bypassing Changi with non-stop services to London, other carriers are doing this with the opening of less technically demanding services directly into Vietnam, China and India. This is why Singapore Airlines will continue to seek the alternative growth that access to the Australia-US market would provide, especially when our policy makers have been long on the rhetoric of free trade but short on fulfilment in aviation. And it is a reminder of why both Singapore Airlines and Qantas held so many discussions in recent years about a possible merger.

Already we see the outlines of an aviation investment structure in which global entities own large fractions of the world fleets for 737s and A320s through leasing, while others own and trade engine and parts inventories and contract essential airline services including training and qualification, and maintenance, repair and overhaul functions, and the building, owning and operating of airports. These financial structures make the purpose of the Qantas Sale Act look increasingly archaic and ultimately irrelevant. These are evolving investment dynamics that will so challenge and dilute the relevance of the equity cap on Qantas as to make its removal imperative in the shortest possible time. It’s time, whatever the fate of current events, to let Qantas enjoy the same flexibility and financial strength as its competitors, unrestrained by anything resembling the stunted, outdated world view that is fossilised in the Qantas Sale Act.

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atx: feature

PETROL PRICES BRING MIXED FORTUNES FOR TOURISM JULIE FISON LOOKS AT PETROL PUMP PSYCHOLOGY 12

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atx: fuellingfear Now, as holiday season approaches motorists have a little more in their wallet than many had anticipated. But the spike in prices has served as a dry run for the tourism industry. The statistics paint a gloomy picture but there are some surprising paradoxes. For visitors from Europe, petrol prices still look pretty cheap compared to what they pay at home. And business is booming in sectors that should be hurting. To underline the importance of drive tourism for the domestic and international markets, the federal government has unveiled a national road tourism strategy to identify touring routes with growth potential. Britz, Australia’s leading leisure vehicle rental operator, watched petrol prices climb earlier this year with great nervousness. The company was expecting holidaymakers to turn their back on motoring tours and choose a less expensive way to see Australia. But the reverse has been true. “If people are going to be taking a campervan holiday with us they will look at the total cost of the holiday and when you look at the incremental increase in the fuel as part of the whole holiday cost it’s not that large,” according to Britz Sales and Marketing Manager Simone MacDonald. Britz’s domestic and international market is continuing to strengthen, with visitors from Europe leading the growth. Motorists in most European countries pay well over $2.00 a litre for their petrol. In the Netherlands, the price hit $2.46 a litre earlier this year. Even when petrol peaked close to $1.50 a litre in parts of Australia, it still looked fairly reasonable to European visitors.

Earlier this year when petrol prices soared perilously close to $1.50 a litre, motorists fumed and the tourism industry braced itself for some tough times. With pundits predicting petrol would break the $2.00 a litre mark by Christmas, the outlook was looking grim. Consumer confidence nose-dived and families began cutting back on luxuries. Drive tourism wobbled and air travel suffered amid increases in fuel surcharges.

Travellers Auto Barn, which caters for backpackers, reports a similar story. Demand for rental vehicles has continued to strengthen and the company has recorded double digit growth in the past few years. Managing Director Peter Burke says lowcost carriers, more than petrol prices , have changed the way backpackers travel around Australia. Instead of buying a car in Sydney and heading off into the sunset, backpackers are more likely to combine cheap flights with some touring in a rental car. This has effectively limited the growth of Travellers Auto Barn’s sales business but increased the rental side. “We can use the petrol price in our favour and tell people to go now before fuel prices go up further,” Burke says. For Australians petrol prices are a number one concern. The Sensis Consumer Report in September confirmed that almost half of respondents indicated they had already

tightened their fiscal belts to compensate for the petrol price hikes. “Forty-two percent have already cut their expenditure,” according to report author Christena Singh. “It tends to be from areas they can easily cut, so entertainment and going out and driving the car are two of the main areas impacted because of petrol prices.” Almost a third of respondents said they were driving the car less to beat the price rises. Not far down the budget conscious householders’ hit list was holidays. Young people and low-income earners were the most likely to make cutbacks as petrol prices gnawed a hole in their earnings. There was evidence that Australians were looking at higher petrol prices as more than just a price fluctuation. Singh says when petrol pushed through the psychological barrier of $1.00 a litre in 2003 more people began looking at alternatives like LP gas. There was another surge in interest when petrol prices went through the $1.20 a litre mark. This represented another psychological barrier and consumers once again began looking at longer term ways of reducing their spending at the petrol pump. Hard hit by the petrol price rises is regional NSW. Tourism in the west of the state has been shrivelling up along with the countryside. The Tourism and Transport Forum (TTF) has found that the number of people employed in tourism in the outback has been steadily declining during the past seven years. Tourism jobs around Mungo National Park and Lightning Ridge as well as around the Murray and New England, have suffered along with drought-stricken farmers. High petrol prices and a lack of lowcost carriers servicing regional NSW have been blamed for the decline. And the TTF has accused the NSW government of failing the entire Australian tourism market with its inadequate marketing efforts. “Tourism funding in NSW is critical as it is the largest tourism market in Australia. If NSW sneezes the rest of the country gets a cold,” says TTF Managing Director, Christopher Brown. NSW Tourism Minister Sandra Nori says the decline needs to be seen in context. Domestic tourism is battling for a share of the wallet against overseas holidays, plasma TVs and electronic gadgets, while higher petrol prices have eaten into family budgets. On top of this, Australians don’t take holidays like they used to. People are taking shorter breaks and stockpiling leave. atx:magazine:yearbook2006

atx: feature “Australian employees have 70 million days of unused annual leave. More than 60 percent of workers in NSW are not using their full leave entitlement each year,” Nori says. Petrol prices as well as other factors may be conspiring against drive tourism, but the car is still the most popular means of getting away on holiday. When the NRMA conducted a survey at the height of the petrol price hikes, it found pensioners were the one group prepared to drive less because of the cost of filling their tank. Other motorists seem prepared to grin and bear it. The motoring association recently launched an online travel planner that has demonstrated that road travel is still alive and well. “We’re up to 16 million maps generated in the past year and we’re finding an increasing number of people planning touring routes on it,” Head of Travel and Touring with the NRMA, Michael Leary says. “The drive travel market is still strong. It’s still the most used method of travel.” Close to 80 percent of domestic and 42 percent of international tourists use Australia’s national road network while on holidays. And that is why the federal government has launched a new Road Tourism Strategy, aimed at connecting holiday makers with Australia’s diverse tourism experiences. “By identifying the key issues and outlining potential opportunities, this strategy is the first step towards fostering a sustainable future for domestic and international self-drive tour markets,” according to Parliamentary Secretary to the Minister for Industry, Tourism and Resources, Bob Baldwin. The government has also announced another caravan safari trail to get tourists into regional Australia. The Wine and Murray Trail takes adventurers from Cranbourne Racecourse through Victoria and South

Australia on a “28-day discovery of some of Australia’s best touring route destinations,” as Baldwin puts it. “Tourism plays an important role in regional Australia because it’s directly responsible for more than 200,000 regional and rural jobs and initiatives like the National Road Tourism Strategy will make a vital contribution to the economic sustainability of local communities,” he said. Tourism NSW has also just announced a 60-page holiday planner to guide visitors through the heart of country NSW. The guide is being supported by a marketing campaign to help visitors find their way to central NSW, New England, the Upper Hunter, the Riverina and the Murray. International drive visitors are also being targeted in a range of campaigns. Tourism NSW has teamed up with Qantas, Hertz

and the Development Bank of Singapore to ensure Sydney and the surrounding areas remain at the forefront of Singaporeans’ minds when they choose their next holiday. Last year 600,000 Singaporeans visited NSW, spending $131 million in the state. New South Wales is also keen to see the burgeoning Chinese market continue to strengthen. Last year an entourage from a radio station in Southern China’s Guangdong Province toured the Hunter Valley and Wollongong to promote self-drive holidays. Shantou Radio Station’s millions of listeners were given a taste of what it is like to drive through one of Australia’s most famous wine regions and tour a spectacular part of the coastline. The message has been reinforced this year with visits by other media representatives and trade officials. Outback Queensland Tourism is also looking to broaden its appeal to international

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atx: fuellingfear “A lot of people are saying ‘we’ve been planning this trip for ages. If it’s going to cost a few extra dollars, we’re still coming’.” visitors. Unlike counterparts in NSW, tourism operators in outback Queensland have had their best season in many years in spite of the savage rises in petrol prices. Visitors have tended to travel less and stay longer in each destination. But it’s not just the bigger centres that are benefiting. Even small towns with little more than a general store and a museum have attracted visitors for more than a month. Concerted marketing efforts have had a greater impact on tourism than the price of petrol. “A lot of people are saying ‘we’ve been planning this trip for ages. If it’s going to cost a few extra dollars, we’re still coming’,” Outback Queensland Tourism General Manager, Barry Duncan says. “Visitors who are coming to the outback are not an elastic visitor. They are a visitor who does a lot of planning. They are not price oriented.” Budding paleontologists have been making their way to outback Queensland’s “Cretaceous Triangle” in numbers never seen before. The towns of Winton, Richmond and Hughenden on the Dinosaur Trail have seen a 20 percent surge in the number of visitors this season. Families are packing up their kids and their camping gear in pursuit of fossils. “I’m hoping to see it continue to rise, particularly from the international visitors,” Duncan says. “The outback is a unique experience that they can’t get anywhere else.” Motorists in Queensland enjoy the cheapest petrol in the country, thanks to the state government’s 8.3c a litre subsidy and Queensland Tourism Minister Margaret Keech believes it has cushioned the effect of petrol prices on tourism. “The impact hasn’t been as strong as in some other states even though drive tourism is about 80 percent of our domestic market,” Keech says. “It’s very important to us to continue to attract driving tourists to Queensland because they do play such an important part of our tourism industry and contribute to our economy.” The Queensland government is committed to preserving a trail of caravan parks along the coast to cater for one of the fastest growing sectors of the Australian tourism market. Despite fears that petrol prices would frighten people away from motoring

holidays, the caravanning and camping market is booming. Camper trailer manufacturer Camel has seen sales rise by 25 percent this year. At one show in Penrith on the outskirts of Sydney, Camel sold 14 camper trailers where normally four or five would have been sold. The surge in sales was reported across the mid-priced camper trailer market. And it’s not just grey nomads taking to the road. Camper trailers are gaining popularity with young families. The development has come as a surprise to Camel Managing Director Don Fitzpatrick, who was expecting petrol price rises to hit sales.

the lead of Singapore Airlines and reduced the surcharge on international flights from Australia after a sustained decline in oil prices. The cut brought the surcharge on a flight to the UK down by $15 to $170. But Qantas has hinted that if oil prices continue to decline, the company may be prepared to make further cuts to international surcharges as well as domestic ones. While the fuel surcharge remains unpopular, Gurney says it’s not having a significant effect on Australians holidaying overseas or international tourists visiting Australia. The strength of the Australian dollar, he says, greatly outweighs the impact of the fuel surcharge. Australians have more to spend when they travel abroad while Australia has become more expensive for overseas visitors.

“I suspect that what people are doing is switching out of more expensive type holidays,” Fitzpatrick says. “What we’re seeing is that families that might traditionally holiday in a resort or Bali instead turning to their domestic caravan, camping or camper trailer type holiday – the sort of holiday experience they can continue to enjoy.”

Despite this, Gurney says the outlook appears healthy in most of the main markets. British cricket fans have boosted bookings from the UK. The Ashes series has attracted visitors keen to support their country and see a bit of Australia as well. Gurney says bookings from China also look healthy while Tourism Australia’s campaign to lure visitors from the US is starting to gain some traction. Japan remains the one large market that is still causing concern.

The massive cost to the company has been in freight increases. Transporting a camper trailer from Camel’s factory in Brisbane to their showroom in Sydney has increased from $300 to $500 – a cost that the company has had to absorb into their profit margins.

Virgin Blue also admits rising fuel charges have been a challenge for the airline, but domestic and international markets continue to grow. Virgin Blue, along with other low-cost carriers, is transforming holiday destinations and in some cases, whole countries.

Rising fuel prices have also eaten into the profits of airlines and remain the industry’s number one concern. Qantas Group General Manager Sales and Distribution Rob Gurney says the company’s fuel bill has more than doubled in the past three years. All airlines are looking at ways to reduce their fuel consumption for commercial and environmental reasons. But Gurney says the effect has been small compared with the quantum leaps in fuel prices. Major fuel efficiencies are still several years off. “We are taking delivery of the next generation aircraft – twin-aisle, twin-engine jet aircraft that are made of composite materials. They will be significantly more fuel-efficient than the existing generation of planes, but that is out in 2008-2009,” Gurney says. Fuel surcharges have become the airline industry’s most reliable means of recovering their extra costs. Qantas began slugging customers with a fuel surcharge in May 2004. In October this year Qantas followed

“We have no doubt that the introduction of affordable jet services into a region, be it Hervey Bay, Coffs Harbour or Launceston plays a vital role in increasing tourism,” Virgin Blue Airlines Public and Media Relations Manager Amanda Bolger says. “Any destination that has affordable, convenient air services is obviously going to be more attractive than one that is expensive and difficult to get to.” Tourism in the seaside town of Hervey Bay on Queensland’s Fraser Coast surged when the local airport was upgraded last year to cater for interstate flights. Now 11 flights a week bring local and international visitors from Sydney, fuelling the tourism industry. As TTF Managing Director Christopher Brown puts it, a two-tier tourism market has been created, between areas serviced by low-cost carriers and others. The challenge is to reinvent and reinvigorate the struggling others. atx:magazine:yearbook2006

atx: feature

Tourism is everyone’s business

Whether it’s a short black in Sydney, a handbag in Hobart or a car service in Cairns, foreign tourists continue to boost the coffers of Australian businesses. But, as Allan Leibowitz reports, improved communication between the sectors of the economy could see traders capture even more of the visitor dollar.

Australia may not be a “shopping destination” like Singapore or Dubai, but that didn’t stop foreign visitors spending almost $13 billion on goods and services last year. The latest International Visitor Survey (IVS) by Tourism Research Australia shows Australia’s 5.04 million international visitors spent an average of almost $2,600 each at Aussie shops during their visits last financial year. Foreign visitors spent a staggering $2.7 billion on food and drink last year while parting with almost $2 billion at retail stores – three-quarters of it on purchases to take home.

Even humble purchases like stamps and phone calls added up to more than $215 million, while visitors handed over another $226 million at service stations for fuel and oil. The survey reinforces the detailed analysis conducted by the Australian Bureau of Statistics (ABS) which found retail spending

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atx: d accounted for upwards of 32 percent of the gross value of tourism in 1997 – more than “traditional” tourist spend categories such as air and water transport (31%) or accommodation (12.2%). Tourist appetites saw more than 16 percent of their cash spent in cafes, restaurants and takeaways, according to the ABS survey. Dr Warwick Frost from the Faculty of Business and Economics at Melbourne’s Monash University says the landmark ABS study highlighted the enormous contribution of tourists to the economy, showing that visitors’ retail expenditure “is far more important than people had believed previously”. The findings should counter the simplistic view of tourist retail habits characterised by busloads of Japanese visitors shopping for opals in souvenir shops, he says. “Tourists do spend on souvenirs, but they also spend on amenities and they often spend on things we don’t even think of,” he explains, citing a tyre dealer who was very active on a regional tourism board because “tourists rent cars and buy tyres”. The indirect contribution is also reflected in the latest analysis of visitor spending on credit cards by Visa International. International visitors put $1.4 billion on their Visa cards in Australia in the June 2006 quarter, up four percent from the same period in 2005. Spending for the year ending June 2006 jumped by five percent to $6 billion. The card company cites retail as its secondlargest category for visitor charges at 17 percent, just one percent behind transport. Professional and commercial services accounted for seven percent of Visa changes in the June quarter, while sports and leisure made up another six percent. Approximately 7.6 million transactions were made by overseas tourists in Australia, most at retail and wholesale outlets (1.7 million) and restaurant and food outlets (1.2 million), according to Visa. The top retail merchants were clothing stores (ringing up $65 million), duty free shops ($28.4 million) and department and discount stores ($27 million). While tourism experts have long been aware of the contribution of visitors to the overall economy, it took the 2000 Sydney Olympics to bring home the real retail impact. During the Games, according to the Tourism and Transport Forum, retail sales in tourist locations increased by up to 80 percent.

The Games resulted in a net increase of $164 million in retail turnover in New South Wales during the month of September alone, with visitors spending $152 million on clothing, souvenirs and take-away food. Olympic merchandise was a huge draw-card, with an average of 45,000 customers passing through the Superstore in the Olympic Park every day. The Olympic Concept stores sold another $54 million worth of merchandise in the threeweek games period, surpassing their budget of $14 million by the ninth day of the games. Frost asserts that “shopping is integral to the tourist experience”, an observation reinforced by recent Tourism Australia findings which indicate that shopping is the second most popular activity for international visitors with 85 percent of visitors - or 4.2 million - participating in this activity. Topping the activity list is eating out, identified as the key activity by 89 percent of visitors. “Many tourists have the time, the money and the inclination to shop while on holidays,” notes Daniel Gschwind, Chief Executive of the Queensland Tourism Industry Council (QTIC), “so let’s give them plenty of opportunity!” Richard Beere, Director, International at Tourism Australia, confirms the importance of shopping as part of the visitor experience, saying the ‘So where the bloody hell are you?’ campaign has recently been adapted to include experiences such as café dining. Coincidentally, Tourism Australia used a department store promotion for the campaign’s recent launch in Canada. The promotion leveraged off the launch of Australia’s Napoleon cosmetic brand in that market. While Beere acknowledges that shopping and dining are popular visitor pastimes, he concedes that Australia will never become a “shopping destination”. “I don’t think shopping will ever be our number one proposition for visitors,” he says. “We’ve got other things that are much more competitive [including] the natural environment, the people and the unique Australian things.” Frost believes Australia can hold its head up high, even against some of the perceived retail tourism hotspots in the region, but he does concede that Dubai and Singapore do a good job of coordinating their retail promotions. Australian retailers, while no doubt aware of the knock-on effect of tourist spending, do not seem to be making the most of the opportunities. Part of the challenge, according to Beere, is the decline in groups and the increase in individual travellers who are much harder to identify. Perhaps because of this difficulty, many of the big name retail and service organisations

The latest International Visitor Survey by Tourism Research Australia shows Australia’s 5.04 million international visitors spent an average of almost $2,600 each at Aussie shops during their visits last financial year. Foreign visitors spent a staggering $2.7 billion on food and drink last year while parting with almost $2 billion at retail stores – threequarters of it on purchases to take home. atx:magazine:yearbook2006

atx: feature contacted by atx: did not want to discuss their customer mix, nor talk about specific marketing strategies for overseas visitors. One exception was national department store Myer which, while unable to quantify the proportion of its sales attributable to foreign visitors, recognises that this is an important market segment. Spokesman Mark West says Myer tries to capitalise on events such as the Commonwealth Games to get foreign visitors into its stores. During the sporting spectacle, Myer set up a Commonwealth Games merchandising shop in its Melbourne store. â&#x20AC;&#x153;We are also involved in many highprofile events such as the Spring Racing Carnival and the Melbourne Christmas Windows, and this year the return of the Melbourne Christmas parade that, while not necessarily internationally renowned â&#x20AC;Ś do capture the attention of international visitors in Australia,â&#x20AC;? he says. For shopping centre giant Westfield, international visitors could account for around 2.5 percent of tenantsâ&#x20AC;&#x2122; revenue, but Michelle Van Zella, General Manager, Marketing, says this varies from centre to centre. She identifies Westfieldâ&#x20AC;&#x2122;s Bondi Junction as the centre where international visitors probably have the biggest impact and says the centre management works with local hotels to provide â&#x20AC;&#x153;special shopping trips and guidesâ&#x20AC;?. Westfield also has an eye on international visitors for its Sydney City redevelopment, with similar programs being planned to tap into the large CBD hotel population. The group is taking input from Tourism New South Wales to ensure its centre meets tourist needs, according to Van Zella. Like Westfield, fuel giant Caltex undertakes extensive customer segmentation analysis and research on purchasing behaviour,

International visitor spending, year ending June 2006 ($â&#x20AC;&#x2122;000) Organised tours Rental vehicles Petrol and oil costs Taxi and local public transport (from 2002 onwards) Long distance public transport (from 2002 onwards) Accommodation Food and drink Shopping to use in Australia Shopping to take home Gambling Entertainment Motor vehicles Phone, fax & postage

606,265 347,668 226,385 375,731 84,159 2,286,028 2,702,116 408,761 1,538,292 135,476 280,222 491,083 215,778

Source: Tourism Research Australia

but, according to a spokeswoman, â&#x20AC;&#x153;doesnâ&#x20AC;&#x2122;t actively target the international traveller as a sub-segment of the tourism industryâ&#x20AC;?. The companyâ&#x20AC;&#x2122;s focus is on repeat visitors and brand preference, so it is more focused on domestic issues.

Rather than complex multi-lingual packaging, each Korjo product is simply labelled with a quick and accurate description of its function. â&#x20AC;&#x153;Our money belt is called a â&#x20AC;&#x2DC;money beltâ&#x20AC;&#x2122; rather than a fancy or invented name,â&#x20AC;? he says.

That said, Caltex certainly realises it has a role to play in Australiaâ&#x20AC;&#x2122;s burgeoning drive tourism market and actively supports Tourism NSW, Tourism Queensland and Perisher Blue with advertising and maps that show Caltex service station locations.

â&#x20AC;&#x153;This is effective not only for our local shoppers, but it certainly makes international visitors (who may or may not have a great grasp of English) aware of the product and its function. Where any customer may not easily understand the function of a product, simple diagrams are added to assist in clarifying the function.â&#x20AC;?

Besides its fuel operations, Caltex, as one of the largest convenience store networks in Australia, finds itself retailing a range of products to all kinds of customers, foreign visitors among them. Foreigners account for up to a third of sales for family-owned travel accessories distributor Korjo. According to Managing Director Ashley Kausman, Korjo products, in their distinctive green and gold packaging, are on sale at luggage retailers and department stores but international visitors are most likely to buy at duty-free shops.

Of course, everyone is aware of the â&#x20AC;&#x153;dark sideâ&#x20AC;? of visitor spending â&#x20AC;&#x201C; tour operators and guides channelling foreign visitors to rip-off retailers for kickbacks. Daniel Gschwind warns that this is â&#x20AC;&#x153;not a practice that will enhance our reputationâ&#x20AC;?. â&#x20AC;&#x153;To protect the vast majority of reputable operators, the Queensland Government introduced legislation more than two years ago with the Tourism Services Act to provide the means to identify and prosecute unscrupulous operators,â&#x20AC;? he says.

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atx: tourismiseveryone’sbusiness For shopping centre giant Westfield, international visitors could account for around 2.5 percent of tenants’ revenue.

Matthew Hingerty, Managing Director of the Australian Tourism Export Council, sees the re-imbursement of GST as another impediment to efficient retail tourism.

“An enforcement program has since been introduced and a number of inspections have taken place.”

He says the industry has rallied behind a submission to the federal government seeking two major changes to the current tax refund scheme.

Gschwind says the industry is very supportive of these steps and is actively urging other states and the commonwealth to introduce matching legislation to provide national safeguards. He also believes collaboration between the tourism sector and retail is improving, quoting the recently formed Tourism Shopping Reform Group in which his QTIC is a participant as “an indication of how common interests are being actively pursued”. Monash’s Dr Frost agrees that businesses need to interact with tourism operators and organisations. “Otherwise, they’re finding out trends and developments by reading about it in the newspapers – and then it’s too late,” he says. He cites sporting events like the Lions rugby tour or the Ashes cricket tour, which attracts hordes of cashed-up British visitors,

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atx: feature

no vacancy In Perth’s hotels, you can’t move for the modern-day equivalent of a gold rush prospector eager to plunder Australia’s resources boom. Graham Readfearn reports on the state of Australia’s top end hotel market. 20

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atx: novacancy If there was such a thing as an international Grand Central Railway Station, it would probably look a little like Melbourne’s high-end hotel lobbies as the next world convention, motor race or conference rumbles into town. Each of Australia’s major cities has its hotel landscape which, on the surface, appears to be healthy, dynamic and eclectic. But pull back the already turned-down sheets, and you’ll find problems for the industry that can’t be solved as simply as replacing a mattress or doing up the bathrooms. Australia craves the attentions of the new middle-classes of China and India, but the projected increase in visitors shows no signs of being matched by investments to build the fashionable swanky new hotel rooms they’ll want. Room rates have barely moved for five years, demand appears stagnant and the industry’s key RevPAR (Revenue per Available Room) is refusing to pick up any speed. Against all that, come hefty and strategic developments in the hotel and tourism economies elsewhere in the Asia-Pacific region creating intense competition. “What we need is a lot more people from overseas who are willing to spend a lot more money on their accommodation,” says Peter Staveley, National Manager Infrastructure, Investment and Planning at Tourism and Transport Forum Australia(TTF). “I scratch my head at the naivety when people say we need more five and six star accommodation in a particular area. If they want them so badly, they should build them themselves.” According to market analysts and advisers Jones Lang LaSalle Hotels (JLLH), in 2005 there were 5.7 million rooms in Australia’s hotels, motels, guest houses and serviced apartments - a rise of 540,000 since 1999. However, the rise doesn’t match the increase in visitor numbers – which went up almost 1.1 million over the same period to last year’s 5.47 million. Figures from JLLH show that at the end of September there were more than 2,750 rooms under construction in Australia which when complete will increase room supply by 3.5 percent. But the number of rooms which the analysts think are likely to be developed in the future has dropped by more than 1,000 in the last 18 months. The major markets of Brisbane, Melbourne and Sydney dominate activity,

accounting for almost 70 percent of current proposals. In the latest Australian National Hotel Register, the firm’s Asia Pacific CEO David Gibson concluded that “traditional, singleowner hotel development is generally not viable except for some mixed-use developments”.

Speaking to atx: Gibson says Australia is still viewed from offshore as a core investment market which is safe, secure and transparent. “Therefore, the returns reflect that,” he says. “It’s a stable and safe investment environment but the expected return on capital is lower than in other parts of the Asia Pacific region.” So if an investor did want to build a new hotel, where else might they look for a better return on their money? Gibson says: “Vietnam for example is hoping to secure World Trade Organisation status next year and that will see good investment interest. Thailand is also going to continue growth – as long as the political situation there calms down – and of course China and India too are seeing growth. “Cost of construction in Australia is a barrier when it comes to building new hotels – so people go and buy an existing hotel instead. “Alternative usage such as residential or commercial can bring higher yield. With the current low vacancy rates, particularly in Brisbane – it makes it much more viable to an investor to put up an office building.” “Where a developer can incorporate a hotel into a mixed-use site, then a brand can enhance the real estate value and help to subsidise the construction of the hotel,” explains Gibson, who cites Brisbane’s Saville South Bank as a prime example. “Room rates clearly need to go up. The economy is reasonably strong so most hotels are looking to increase room rates above inflation, but that won’t happen in quick time. “Sydney is one of the few Olympic cities in the world that’s doing less tourism after a games than before. That’s under-investment in the tourism market by the New South Wales government. Decrease the funding for long enough – and NSW has decreased funding – then you kill the industry.” Queensland is one of the few states which has committed to increased funding.

“What needs to happen is that governments need to continue to stimulate the development of infrastructure in this sector,” Gibson says. “If they don’t, then you place at risk the likelihood of major conventions from around the world coming here. The more demand you can create then the higher you see room rates pushed.” Most industry figures agree with Gibson that Australia’s room rates are simply too low (especially when compared with construction costs) to make an attractive package for investors. If we don’t provide the high quality accommodation demanded by these visitors, they will take their business elsewhere. “We won’t sit back and watch that happen”, says Queensland’s Tourism Minister Margaret Keech, who has just announced a $48 million investment package as part of the state’s new tourism strategy. “Queensland in future years will be targeting the higher-yielding markets. We know there is a demand for luxury accommodation from the growing markets of China and India, as well as the Middle East,” Keech says. Mark Taylor, Managing Director at Pacific Spirit Travel, a small to medium-sized inbound tour operator specialising in European markets – especially France and the UK – is at the sharp end of the supply dilemma. “Special events are what give us the most headaches, like Formula 1, the Melbourne Cup and at Christmas when prices get pushed up. That situation does cause us problems. “In particular, Melbourne causes problems because it is events-driven – which is great for attracting business to Melbourne, but not so great if you are a holiday maker,” says Taylor, who was left having to offer customers rooms out in the suburbs during the last Melbourne Cup. “There is much more room for investment, but in the current tourism market there’s a lack of desire. The figures are not going up enough for either inbound or domestic visitors. You start wondering if there is any interest in investing in tourism (from governments). That has to be a concern for us as an industry which is highly taxed.” Taylor’s point comes home when you see South Australia’s decision in September to slice more than $3.5 million off its tourism budget for 2006/07. The ACT has abolished its tourism agency entirely. atx:magazine:yearbook2006

atx: feature

“It is one thing to say that we need hotel rooms but given the current occupancy rates it would be a high-risk strategy.” While hotel managers suffer roster headaches, they are also looking over their shoulders at real estate agents, claims Peter Staveley. He says a slump in the rentals market across major cities has seen the emergence of rental agents marketing properties to tourists as short-term lets, which was “essentially eating the hotel sector’s lunch”.

“Hotel chains are looking at buying existing properties rather than in building new ones. Labour costs too are restrictive. In south east Asia for example you can put a lot more staff in a hotel than you can here,” he says. Taylor says that many tourists see Australia as being able to offer them five star luxury at three star prices, which is great news for the tourist but will turn an investor off. “As an industry that survives on commissions, the higher the price is then - theoretically - the more we should make. But there is a constant demand for us to bring our prices down. There is always that pressure from wholesalers to keep those prices as low as possible.” Taylor believes hotel chains themselves have scored something of an own-goal when it comes to preparing visitors for higher rates. “Some have made a rod for their own back by offering last minutes rates. Customers get used to seeing the rates on wotif.com and lastminute.com and then just expect those low prices all the time”, he says. “I think we really do need to look at where Tourism Australia and the government are heading in the next three to five years. “We have heard a lot of talk about the Indian and Chinese markets – but we are not sure yet what those markets will actually want. We would like to see an increase in business from more traditional markets and we have to find a way of helping that.”

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Peter Staveley at TTF says the hotel industry’s problems are interlinked, with the issue over room rates representing the tip of the iceberg. “This is an industry that demands a wide variety of skills. It’s labour intensive and we have a situation where there is a considerable degree of competition for labour from other industries – particularly as the boom in the resources industry soaks up labour. “People are leaving to take higher-paid jobs and ultimately the turnover of labour is going to have an impact on service. “Labour forms a critical part of the overheads of a business which reflects in the price. Whilst a booming sector like Western Australia might have the ability to pay a higher price, the impact on the accommodation sector is that we have to let staff go - or pay them more - unless we increase our room rates.” ATEC Managing Director Matthew Hingerty says: “Of course we want to see investment in new hotels, but it’s not that simple. You need to be able to staff them first. “Rooms in hotels and motels are being shut and investment plans are being put off. Hotels are being built but the owners are facing the prospect of being unable to staff them. Service levels are dropping and small business owners in the tourism industry are working horror shifts for lack of workers instead of managing their businesses.”

“If government says they want these five and six star hotels then they should be prepared to assist in fulfilling some of those elements of their desires,” Stavely says. ”It is a lot cheaper for a politician to say they want something than it is for them to say they will spend $200 million in building a new hotel in the hope that market conditions might change. The reason people are not investing is because they are not seeing the demand that makes that investment worthwhile.” Staveley uses an analogy from the Kevin Costner film a Field of Dreams, when an Iowa farmer is told by a mystery voice that if he builds a baseball field in his paddock, “they will come”. “If you build it, they might come,” says Staveley. “But if you don’t, then they can’t come!” Bill Healey, Australian Hotels Association Director of National Affairs and former Director-General of the NSW Government’s Department of Tourism, Sport and Recreation, puts it simply. “Room rates are just not high enough to sustain investment.

atx: novacancy “It is one thing to say that we need hotel rooms but given the current occupancy rates it would be a high-risk strategy.” Occupancy rates across Australia rose by just one percent last year, compared with rises of more than three percent for the years 2002, 2003 and 2004. “We see the emergence of China and India and given the focus on those markets – along with some of the issues around the exchange rate – we feel more focus should be on business-related visitors either in the meeting or incentives market. It is these people who can stay in the better hotels. Focusing on other markets gives you people who are much more cost-conscious,” he says. “You are at the mercy of the supply chain that is supposed to deliver customers to you – it is a long-term and high-risk investment.” But Healey points out that, even in what appears to be a market fraught with contradictions, there have been recent big investments.

Despite all the apparent doom and gloom in Sydney, SCVB secured a record $373 million worth of conferences and other events in the last year. In pure numbers it means more than a quarter of a million extra visitors for the city between now and 2014. That’s a lot of bathrobes. “Sydney remains Australia’s leading city for business events and one of the world’s most desirable locations for conferences,” a glowing Hutchison said at the announcement of the results. But speaking to atx: Hutchison admits that there has not been a great deal of construction of new rooms in the city in recent years. “The fact is that at the moment I don’t see a huge need for five-star construction, but I do perceive that there will be a need in the future – certainly around 2010 and onwards.

RevPAR gains 2004/05 City

% gain

Adelaide Brisbane Cairns Canberra Hobart Melbourne (central) Perth Sydney Singapore Beijing Jakarta Kuala Lumpa Hong Kong

4.3 10.7 8.3 8.2 7.6 7.8 12.3 7.3 17.4 17.8 22.6 9.7 19.6

Source: Deloitte Hotel Benchmark Survey

Occupancy rates

1999 2006 2011f

The Sydney Hilton re-opened last year after a $200 million refurbishment, bringing almost 600 rooms and suites back onto the market.

“We do need to create an interest to invest. Five star occupancy is averaged below 80 percent so there is some stretch there and the average rate is still below $240 around NSW. Those rates are a reflection of demand and I don’t think the demand is there yet. We are coming out of a long period of recession for five star hotels.”

Western Sydney will also get its first five star hotel with the construction of the new $65 million Sofitel at Sydney Olympic Park – offering more than 200 deluxe rooms when it opens in the first half of 2008.

Hutchison says that while people are pointing towards Sydney’s failure to capitalise on a potential post-Olympic tourism boom, it is only partly down to low levels of government investment.

Doma Hotels in Canberra is currently building a 160-room luxury hotel in the Parliamentary Triangle in the capital.

“We’ve had 9/11 that came from nowhere and SARS and terrorism. Those were significant disruptions that other Olympic cities didn’t have so it is difficult to make comparisons.”

“Hotel investment traditionally comes in rushes and I would like to see a more proactive approach which is happening in places like Singapore and Dubai where there is a drive to really stimulate these investments.

He says the competition from around the Asia Pacific region for the business tourism dollar – including the Arab states - has been intense.

“Unfortunately though, that is not the Australian way.”

There is also good money on Brisbane becoming the next major city to build a new full-services hotel. John Hutchison is the Managing Director at the Sydney Convention and Visitors Bureau (SCVB). He agrees with Healey that the business customer is king.

Adelaide Brisbane Cairns Canberra Hobart Melbourne Perth Sydney

67 64 65 61 61 70 67 71

71 79 70 69 70 76 75 78

75 74 67 71 69 75 74 77

Source: Jones Lang LaSalle Hotels

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atx: feature Every time the international media pick up stories on unscrupulous inbound tour operators (ITOs) - as they did last month with yet another unsubstantiated report of visitors being charged to walk on a Queensland beach – Australia’s integrity as a quality tourism destination takes a blow. Clear and consistent national licensing laws and codes of conduct would help maintain quality – assuming they were properly enforced. But inbound tour operators currently face a regulatory environment that is complex and inconsistent.

At present, any ITO that sells a tourism product and passes on funds to a third party must obtain a travel agent licence from the state or territory within which it is based. With the exception of companies in the Northern Territory, the company must then become a participant in the Travel Compensation Fund (last calendar year 124 TCF participants had more than 80 percent of their turnover generated by inbound activity). Any Queensland-based inbound tour operator selling travel packages overseas must also be registered under the state’s

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Tourism Services Act. Introduced in 2003, the Act also requires all inbound tour operations (whether or not they are registered) to adhere to an enforceable Code of Conduct. Finally, if an ITO in Australia wants to cater to the fast-growing Chinese market, they must obtain a licence under the Federal Government’s Approved Destination Status (ADS) Scheme.

Onerous but essential Complying with these various regulations can cost inbound operators time and money. Nevertheless, industry leaders, including AOT Chief Executive and former ATEC Chairman Andrew Burnes, accept they are required. “[Current regulations] are restrictive but, in the light of quality issues that concern ATEC, government and

the industry, necessary, on the proviso that the consumer affairs bodies adequately police the rogues within the industry, and the burden doesn’t just fall upon those doing the right thing,” Burnes says. “In other words they have to be meaningful from an outcome standpoint. They have to deliver on the outcome they are meant to deliver on, which is basically a quality

experience for international visitors coming into Australia, otherwise what is the point.” Rather than calling for the easing of existing regulations, ITOs – acting through ATEC - are calling upon other states and territories to follow Queensland’s lead. No one wants to further complicate the regulatory environment by creating a scenario in which ITOs would need to satisfy separate licensing schemes in various states. Instead, the industry is

calling for the development of a single, seamless national scheme, under which any ITO satisfying licensing requirements in its home state would automatically gain accreditation in all other states and territories. “There are very strong arguments for a national program that encompasses both travel agent licensing and the qualitative requirements that the Queenslanders have been pro-active in developing to date,” Burnes says.

“We already have a national body in place that is a one-stop-shop for all states and territories except the Northern Territory. ”

atx: licensing “Queensland is serious about taking on the crooks and we will keep up the pressure on dodgy operators to stop them tarnishing the reputation of the Queensland tourism industry.” illegal practices. “It would be much better and more efficient for industry to be able to comply on a national basis for that, rather than have to do it on a state-bystate basis.”

“As a result of investigations arising from compliance activities, 16 enforceable undertakings have been entered into with registered inbound tour operators who failed, in some way, to meet their obligations under the Act,” Keech says.

on the agenda at both fair trading and tourism ministerial councils. And she claims to have been “heartened” by recent moves towards

ers t r o p x e m s i r u o t ’s a s. ali e r t u s g u o A r e h t c hi na i w m n i l o e e d u n s is ya e f i n t o n s e i d e i r o If the is the need t rangle over red tape agree, it rroll looks at the w David Ca Queensland Minister for Tourism, Fair Trading and Wine Industry

Development, Margaret Keech agrees that greater “harmonisation” of inbound tourism regulation across Australian jurisdictions would benefit industry.

The Queensland experience Queensland introduced its Tourism Services Act to eliminate a variety of unethical practices, including restricting visitors’ choice of shopping venues and pressuring traders into paying excessive commissions. Under the Act, inbound tour operators are required to be registered with the state’s Office of Fair Trading (OFT). Registration carriers an application fee of $553.30 per year and a registration issue fee of $50.30. Keech says that since 2003, the OFT has conducted a range of compliance operations and spot checks on inbound tour operators. Working with other government agencies it has also interviewed more than 4,500 tourists, handing out brochures explaining their rights when it comes to shopping and providing information on how to report

She claims the legislation has been effective in protecting not only tourists, “but honest traders who do the right thing”. Since compliance activities began, the number of registered inbound tour operators has increased from 66 on June 30, 2004, to 150 as of October 26, 2006. “Queensland is serious about taking on the crooks and we will keep up the pressure on dodgy operators to stop them tarnishing the reputation of the Queensland tourism industry,” Keech says. “We will also continue to work with industry to discuss options for making legislation more effective.” Where Queensland has been less successful is in convincing other states to follow suit.

National agenda Despite plenty of discussion about the need for a national licensing program based on the Queensland Tourism Services Act, so far at least there appears to have been very little action. Keech claims the Queensland government has worked hard to ensure the issue was

the development of national legislation by the National Inbound Tourism Legislation Working Group, a body chaired by the Commonwealth Department of Industry, Tourism and Resources.

“Since compliance activities began the number of registered ITOs has increased “Details of the commonwealth’s proposed National Inbound Tourism legislation are eagerly awaited,” she says. Others are less convinced the issue is genuinely moving forward. And privately, some ITOs claim there has in the past been a naïve assumption – within the inbound sector – that public discussion of an issue was all that was required to place it on the appropriate political or regulatory agendas. With respect to a national tourism program, Burnes says there is no doubt the industry would need to work more closely with the heads of the consumer affairs departments and with the Ministerial Council of Consumer Affairs to make sure the issue was “actually getting a hearing”. If traction was gained and a national licensing program finally adopted, the industry is unlikely to see much impact atx:magazine:yearbook2006

atx: feature The Ministerial Council of Consumer Affairs (MCCA) rejected Australia Post’s application but asked the TCF to explore the merits of a risk-based fee structure.

“There is no reason we couldn’t employ people on a local basis to be the local administrator and go to visit these places,”Wells says. “You don’t need offices in every location to do random checks or to investigate problems you are aware of, as we do now.” on the federal government’s Approved Destination Status (ADS) program for ITOs catering to the Chinese market. On the surface, there would appear to be overlap between the ADS and the Queensland Tourism Services Act, and therefore, any prospective national legislation. ADS participants, for example, must undergo a rigorous screening process and are required to comply with an ADS Code of Business Standards and Ethics. The ADS program, however, is not just

concerned with maintaining the quality of the visitor experience. It is also designed to ensure the Australian government meets the broader requirements of the Chinese government’s scheme, including the necessity for visitors to return home once their holiday is over.

Earlier this year, the fund commissioned Melbourne-based Allen Consulting Group to look at the feasibility of a risk-based assessment scheme to replace its current one-size-fits-all approach to fees. The move was sparked by Australia Post’s bid in late 2005 for exemption from travel agent licensing requirements - including membership of the fund - to enable it to sell Jetstar tickets through its nationwide outlets. The company argued it should be exempt from paying the fees on the basis it was government-owned and financially stable.

Under review

The Ministerial Council of Consumer Affairs (MCCA) rejected Australia Post’s application but asked the TCF to explore the merits of a risk-based fee structure.

One piece of the regulatory puzzle that is currently under the microscope is the Travel Compensation Fund (TCF).

Such an approach could have positive implications for inbound operators, who, over the past 10 years, have caused the

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atx: licensing fund few problems. During that period there has not been a single collapse of any participant with more than 80 percent of its turnover from inbound (there have been 12 collapses involving companies with levels of inbound activity ranging from two percent to 59 percent of turnover). An interim report based on Allen Consulting’s findings has been delivered to the Standing Committee of Officials of Consumer Affairs (SCOCA), with a final report expected by the end of the year.

related services market”. In theory this study – which must be presented to the council by mid-2007 could precipitate major changes to the fund. The Australian Federation of Travel Agents (AFTA), for example, has been arguing for some time for fund participation to be expanded to include anyone involved in the selling of travel. This would require everyone from a tour desk in a hotel to an international airline to take part - not a scenario likely to find

financial contributions from state or federal governments - not a scenario likely to find much favour within the political sphere. Rather than expand fund participation, there are some within the industry who would like to see the TCF dismantled altogether. But eliminating an organisation that successfully manages the industry’s financial health - and ensures stranded travellers seldom make the news - would be a brave move. Oneless radical change the MCCA may be more willing to discuss is an easing of compliance costs.

Taking into account new application fees, Taking into account new application fees, annual fees, annual fees, branch fees, audit fees, etc, collectively spend many millions branch fees, audit fees, etc, agents collectively spend many agents each year to take part in a fund that on pays out around one million millions each year to take part in a fund that on average pays average dollars each year to consumers. It’s a financial burden some within the industry out around one million dollars each year to consumers. believe is unwarranted.

Qualitative debate Last month, however, the MCCA instructed SCOCA to commission a study of industry trends “to identify and review the effectiveness or need for consumer protection measures in the broader travel

much favour within the inbound sector. Such a move would significantly increase the fund’s exposure, thus requiring a rapid growth of reserves. AFTA wants consumers to pay, but it could also necessitate

The risks associated with all inbound tour operators joining the TCF may prove too high. But given the fund’s success at monitoring travel agents on a national basis, could its responsibilities be expanded

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atx:magazine:yearbook2006

atx: feature “It’s been set up by the individual departments of consumer affairs, so in some ways it’s almost a natural fit.”

“I don’t think it’s a viable option unless the TCF is given the resources, or access to the resources of the consumer affairs departments to ensure that the qualitative measures being sought are actually being complied with.” to include managing and enforcing a national licensing scheme or code of conduct for ITOs?

every location to do random checks or to investigate problems you are aware of, as we do now.

TCF Chief Executive Glen Wells believes such a role should be considered, even though the TCF has no offices outside Sydney.

“We have the resources, experience, systems and databases to do it. And we already have a national body in place that is a one-stop-shop for all states and territories except the Northern Territory.

“There is no reason we couldn’t employ people on a local basis to be the local administrator and go to visit these places,” Wells says. “You don’t need offices in

“It’s been set up by the individual departments of consumer affairs, so in some ways it’s almost a natural fit.”

But not everyone agrees that the sort of qualitative analysis required by the Queensland Tourism Services Act can be undertaken centrally. “I don’t think it’s a viable option unless the TCF is given the resources, or access to the resources of the consumer affairs departments to ensure that the qualitative measures being sought are actually being complied with,” AOT’s Burnes says. It’s an interesting debate, and like the conversations on a national licensing program, the industry needs to ensure the right people are listening.

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atx: usefulstuff

The art of communication By Anders Lindström Public relations is somewhat of a grey zone for most businesses, yet it can be the most cost-effective and long-term method of creating awareness. Spending your entire marketing budget on one-off ads, especially overseas, can cost almost double the investment of one month’s worth of PR activities. Advertising is effective on many levels, but as anyone with an understanding of PR will tell you, nothing beats having your product mentioned in a feature, as well as the product’s credibility. “Getting your product endorsed on an editorial level is invaluable,” explains Philip Engelberts, director of PEPR. “It helps to raise the product’s profile by raising awareness amongst overseas consumers. This in turn, will result in additional sales.”

Satu Raunola, director of Finnesse Communications, agrees with Hanger on cooperation: “Work with other companies and combine your resources, which makes it more affordable.” “Dedicate at least a couple of hours a week to PR,” suggests Hanger. “PR should be one quarter of sales and marketing. Don’t put all your money into advertising. Instead of four weeks of ads, do three and put the money into a pool for PR.” The money could be spent on hosting a visiting journalist. Engelberts takes advantage of the existing network of foreign correspondents based in Australia. This provides operators with the opportunity to host a Sydney or Melbourne-based reporter, but receive media coverage in the UK, Scandinavia or the US, for instance. Your success comes down to research. Overseas magazines tend to work differently to Australian ones, and on a different schedule. “Preparing relevant information for international key travel periods in a timely manner is essential,” says Laura Speirs, director of 8th Day

“PR should be one quarter of sales and marketing. Don’t put all your money into advertising. Instead of four weeks of ads, do three and put the money into a pool for PR.” There is really no excuse these days for not having any form of a PR strategy in place, especially for smaller companies. Thanks to the internet, the world is smaller than ever, and you can receive media coverage in overseas markets if research is done properly. Damien Hanger, former PR manager for Voyages, one of Australia’s most covered tourism brands in overseas media, offers a number of strategies for smaller companies: to cooperate with other local operators; to produce an effective media kit; and to make a trip to meet with Tourism Australia and present your product.

Communications. “For instance, many publications are working on two month lead times, plus seasons globally are different so your messages have to be tailored accordingly.” To increase awareness of your product amongst agents overseas, target travel trade media. They are mostly based on press releases, but remember to only distribute one when there is something relevant to communicate to media and agents. There are newswire services, such as TravMedia, that distribute press releases at a cost to its entire network of travel editors and journalists in countries such as the US, Asia and the UK, as well as Australia,

where it has a strong presence. Another Australian-based website is WriteClick, which has a database of overseas and Australian freelance travel writers. If no one in the company has any PR or media experience, don’t try to go at it yourself. Instead speak to a local journalist and/or contract a PR specialist to create a PR strategy tailor-made for your company. Some PR firms, such as Raunola’s Finnesse Communications, offer companies just that service. “When you have a PR strategy and implement it accordingly, then you are in control,” she says. With PR, patience is a virtue and don’t expect results overnight. “Be prepared to give your PR strategy at least three to six months to kick in,” says Speirs. “Building awareness takes a little time, but once the ball is rolling you should see good return on investment.” Adds Raunola: “It is a snowball effect, but long-term your reputation and the awareness grows.” Quick tips to successful PR • Research is key! Properly research what publications are the most suitable to your target market, and why • Do not send press releases for the sake of it. If the news is relevant, it will get published • Don’t expect overnight results • Consider sponsorships or hosting events to attract media coverage • Small operators should partner up with other local operators, especially to attract visiting journalists • Use Australia-based foreign correspondents, if available • Be realistic with what you can achieve within a set budget • Create an informative media kit • Have a library of high-res images (300dpi) • Always be honest! atx:magazine:yearbook2006

atx: theinterview The Burrinjuck MP and NSW Shadow Minister for Tourism and Major Events has clocked up an impressive 304,750 clicks since becoming the member for the electorate, which covers a sizeable 24,849 sq km. She’s also seen a fair bit of NSW since landing the tourism and major events portfolio in 2005. Having operated successful tourism retail ventures in Yass and the Southern Highlands of NSW gave Hodgkinson the opportunity to see tourism in operation at the grass roots level. The retail business which focuses on selling Australiana products and natural fibres has been a good fit for 40-year old Hodgkinson, who grew up in the country and today lives on a merino stud near Murrumbateman with her young children and sheep farming husband. It was after opening the second store in the Southern Highlands that Hodgkinson became closely involved with local tourism issues through organisations such as the chamber of commerce, the Southern Highlands Tourism Board and the Office of Economic Development .

“After five or six years I was approached to run for the seat of the Southern Highlands, John Fahey’s old seat, and put my hand up for it,” she says. While she did well, winning the primary vote, she ultimately lost on preferential votes. After consolidating her retail outlet back in Yass and doubling the size of the store, Hodgkinson went to work for Senator Nick Minchin to gain a better understanding of the parliamentary system and how it works internally. “It was a great experience and he (Minchin) was a great mentor,” Hodgkinson says. With Senator Brian Harradine holding the balance of power in the Senate, Hodgkinson put in long hours and became heavily involved in diverse issues such as Native Title and the Constitutional Convention before becoming Minchin’s executive officer. When Alby Schultz retired from the state seat of Burrinjuck in 1999, Hodgkinson was approached by the National party to run and this time won. Despite her hectic schedule, Hodgkinson still runs the Yass store. “It’s a great leveler. It’s good to maintain grass roots contact with tourists and others to find out what they’re thinking.” After a reshuffle in 2005, Hodgkinson was awarded the Tourism and Major Events portfolio – a promotion she relishes because of her passion for tourism. With an election fast approaching in NSW, Hodgkinson believes the major issues facing the state are a lack of funding to attract major events and the downturn in visitor numbers – a concern for everyone from city hoteliers to rural tourism operators. “This is a state government problem. Tourism is a $23 billion industry and in NSW alone employs six percent of the workforce, 65 percent of whom are based in regional areas. The downturn in

visitor numbers and tourism’s overall decline needs to be addressed urgently.” Hodgkinson says the state desperately needs more convention space to accommodate business tourism, in which NSW is losing out to Queensland and Victoria. And she says NSW is not spending anywhere near enough to attract major events. “Victoria wins event after event, which is depressing when you consider how much is lost to the south.” On a micro level, she says there are other issues that need to be addressed once tourists arrive in NSW. “Things like signage so tourists can get around and know where they are in relation to other attractions like the Opera House, the Harbour Bridge or Sydney Tower. The most commonly spoken language for inbound tourists apart from English is German. Yet there’s no German, Japanese or Chinese language signs, which must make it incredibly difficult.” Hodgkinson has also introduced a private member’s bill to control rogue tourism operators and protect international tourists from unscrupulous practices. And she would like to see Sydney’s taxi issues resolved. “It’s incredibly hard to get a taxi, especially if you’re wandering around with a backpack, and you have no idea where the taxi ranks are.” These issues, Hodgkinson says, can be addressed with minimal cost, meaning tourists then take a positive impression of Australia back home with them. “I want to see tourism as an economic portfolio because it’s a big money spinner, a huge revenue raiser and an enormous employer of our workforce. NSW is the gateway into Australia and yet our tourist and accommodation figures are declining. I see major events and investing more funding in marketing as key to turning things around.”

Katrina Hodgkinson Sheriden Rhodes talks to the NSW Shadow Tourism Minister

Born and bred in Yass in country NSW, and being the local MP, means mother of two Katrina Hodgkinson spends a large chunk of her time in the car. atx:magazine:yearbook2006

This organisation is held in high esteem both internally within its membership and externally within the wider sphere we need to influence. Membership continues to grow and the finances are sound. But while we as an organisation have perhaps never been stronger, we need to continue to add value to our member businesses as the core role of ATEC. John King, Chairman

We also need to be increasingly aware of and, where possible influence, the external environment to which this sector and its individual businesses are particularly vulnerable.

We are in sight of the end of the current enhanced federal government commitment to tourism under the White Paper. ATEC will need to take a key role in preparing the case and in undertaking the wide-ranging lobbying exercise that will be required to support the case for a continuation of that commitment. Our competitive performance in inbound tourism is cause for concern. Over the past six years we have lost market share in both visitor

This is not a criticism of Tourism Australia, a comment on the effectiveness of its advertising creative, or of individual marketing strategies. This is something we all need to take on board. We need to collectively assess the barriers to travel to Australia without fear or favour. We need a better understanding of what, if anything, has sapped the strength of our appeal. We need to better harness the unprecedented flood of world-wide capital to enhance the Australian tourism product and enrich the Australian tourism experience. We need to better understand the rapidly changing dynamics in the aviation industry and ensure that the Australian tourism export sector among the most reliant upon competitive, quality and reliable air services, is a beneficiary of those changes. I believe the challenges to our sector are not superficial or cosmetic, they are in fact deepseated and structural. We need to work closely with government and the wider industry to come to grips with the underlying issues and return Australia to its position of leadership in the field of effective and sustainable tourism development and growth.

John King Chairman atx:magazine:yearbook2006

ANNUAL REPORT ATX CHAIRMANâ&#x20AC;&#x2122;S REPORTATEC DECEMBER â&#x20AC;&#x2122;06

Labour shortages and the impact they have on business operations, profitability, service delivery, investment and expansion are already limiting the capacity of this sector and will, if not addressed constructively and even imaginatively, further stifle the growth and revenue from inbound tourism.

numbers and spending. Although the desire to visit Australia remains high in many of our key markets, our ability to convert intention to reality appears to be lessening.

our services to members. 2005-2006 saw a range of new offerings that were enthusiastically received by our members and all of them were designed to develop the sector. Our new magazine, atx:, fills a much needed void in the tourism industry for a serious journal for the exchange of ideas. It is also a platform to market ATEC to our external stakeholders.

Matt Hingerty, ATEC Managing Director

ATEC MD’s report The year 2005-2006 was one of frenetic activity and reform at ATEC. The National Board, head office, branch managers and branch committees have been working feverishly to strengthen the organisation, plan for the future, improve services to members and to place ATEC at the forefront of debate on issues that affect our sector. I think I can speak on behalf of all those responsible for guiding ATEC’s fortunes that while the year has been challenging, we have found it rewarding and enjoyable. ATEC has always been, is now, and will forever be a business-to-business service organisation. Our primary aim is to bring our members together to help them do business. To that end, 2005-2006 was a pleasing year, with our more than 80 well-attended networking events, and a notable increase in activity by ITOs at formal workshops. Meeting Place continued its growth while the Symposium in Cairns was, according to your feedback, one of the best in recent memory. Once again, thank you to the industry in North Queensland for helping us stage a very successful event.

ATEC ANNUAL REPORT

As a membership-driven organisation, ATEC will never rest in our aim to improve

ATEC Annual Report –

our year in review

The website has been overhauled and will continue to be so. It will serve as a platform for our Tourism Export Institute which is our flagship for industry development. A key element of the Institute is our Export Ready program of online learning modules developed with the assistance of the Department of Industry, Tourism and Resources. As ATEC recognises its responsibility to build capacity in the tourism industry to cope with a projected increase in inbound tourism, it is likely we will seek further partnerships with government to help the transfer of knowledge from the successful pioneers of our industry to new entrants. The market strand concept at Symposium worked well and will be refined. The “conference within a conference” initiative allowed members to get deeply into the issues affecting various markets. Another initiative across the year was the highly successful media and communication workshops driven by Kerri Anderson. On the subject of communications, ATEC conducted an aggressive media campaign designed to keep our brand in the top of mind with decision makers. The next stage of marketing our brand and our members is to our international stakeholders, and the successful application for Approved Body Status under EMDGS will assist in that cause. Also, will be a new and very successful mutual relationship forged with PATA and a further agreement with the Australian Regional Tourism Network will assist us to take the export message to the grass roots in regional Australia.

ATEC’s business planning and activities revolve around our Corporate and Operations Plans. Here is how we have performed against our objectives in the 2005/06 financial year.

Of course ATEC is also a representative organisation and we have been involved in a number of lobbying campaigns throughout the year, both singly and in concert with our colleagues in the National Tourism Alliance. The campaigns we have been involved with are listed elsewhere in this report, but at the forefront have been the preparation for the post-White Paper environment and issues affecting the reputation of our industry such as forced shopping. Many campaigns are aimed to assist the direct bottom-line of our members, including the labour shortage, tourism shopping, visa and GST issues. At the heart of all this activity have been our hard-working branches and panels. I would like to pay tribute to the energetic and innovative work of many of our committees and applaud the emergence of a positive spirit of competition between the branches. A special mention should also be made of the work of the Backpacking Tourism Advisory Panel which really kicked some goals in relation to the increase in the Working Holiday Maker visa and its hard work to get a backpacker visa for the United States on the national agenda. Young ATEC has continued to emerge and is providing our leaders of tomorrow with peer support through such initiatives as the NSW mentoring scheme. Finally, and on a personal note, I would like to express my thanks to both our independent chairmen throughout the year for their advice and support. As the financial report later in these papers describes, we left 2005-2006 in a much stronger financial position than when we entered it. Much of the credit for this should go to our former Chairman, David Mazitelli, and his pursuit of excellence in corporate and financial governance. Under the professionalism and vision of John King, we look forward to building on these strong foundations into the next year.

Matt Hingerty

Objective: A Focus on Business Development Goal: To deliver

business development programs that benefit ATEC members.

Strategy: Delivery of business-to-business activities and networking opportunities across Australia.

National events: ATEC held three major national events during 2005/06 attracting almost 1000 delegates all up.

Meeting Place – more than 350 delegates

attended the 2005 Meeting Place at Star City in Sydney. The event included member forums, workshops, a gala dinner and the ATEC Annual General Meeting.

Symposium - Australia’s largest private sector tourism trade conference hosted a record 600+ delegates in Cairns in May featuring

atx:magazine:yearbook2006

workshops, plenary and breakout sessions. For the first time in 2006 a series of mini conference strands were held focusing on the key backpacker, China, Japan and UK markets. The mini conferences were a huge success and will be run again as part of Symposium 2007 – to be held in The Tweed, Northern NSW.

Leadership and Management Conference

– held at the International College of Management, Sydney at Manly. The conference targeted young industry professionals and featured a range of guest speakers and workshop sessions.

Branch events: We held over 80 events across our nine branches, including a range of educational seminars, workshops, familiarisations and Young ATEC events. Highlights included:

North Queensland Branch: Inbound Up North - was held at Palm Cove in October 2005. A record number suppliers and 50 inbound tour operators visited Palm Cove for this annual event.

NQ Sydney Showcase – the branch’s seventh

annual showcase was held on the MV Sydney 2000, Captain Cook Cruises’ flagship vessel in March. Held just days after Cyclone Larry hit the tropical north, the show went on with a large number of suppliers and almost 70 inbound tour operators.

South Queensland Branch:

Canyon as part of the event.

NT Top End Branch: International industry forum – Tourism

NT provided a briefing on international activities.

Tourism NT international managers dinner – 46 members and guests attended the annual ATEC Top End branch dinner with Tourism NT international managers and media/PR representatives.

Gold Coast ITO workshop – the March

Victoria/Tasmania Branch:

Brisbane and Sunshine Coast famil – was

Tourism Victoria hosted 60 senior inbound tour operators in February 2006 in a series of workshops appointments and a famil program.

workshop and familiarisation was rated as one of the best ever. expanded to include all of regional Southern Queensland, resulting in a 100 percent increase in inbound tour operator numbers and wide dispersal of ITOs throughout the region.

Export Ready seminars – a series of seminars

were scheduled for regional areas including Agnes Water and Toowoomba.

South Australia Branch: Discover SA – for the first time, South

Australia’s annual inbound tour operator workshop was held in a regional area at the Wolf Blass Visitor Centre in the Barossa Valley.

ATE Adelaide – the branch organised an

NT Central Branch: Tourism NT international managers networking function – provided an excellent opportunity for ATEC members to meet with overseas managers.

Inbound to the Outback – the branch hosted

a successful sunset cocktail function at Kings

Victoria/Tasmania famil and workshop – held

in August on Phillip Island. The famil dinner was addressed by Victorian Tourism Minister, John Pandazopoulos.

Strategy: Develop an extensive “valueadded” member benefits program.

range of industry conferences and forums.

Member Benefits program – the program

Tourism Export Code of Conduct - the code, an

continues to grow in terms of offers for both businesses and individuals with a wide range of products and services available through the ATEC website.

Strategy: Develop industry standards and professionalism.

Export Ready – Developed an online e-

learning program, Export Ready, enabling participation by students from anywhere in Australia with internet access. Developed with the support of the Department of Industry, Tourism and Resources, Export Ready offers a range of modules focused on the business of inbound tourism and covers topics such as the nature of export tourism, the distribution system and cultural awareness for key markets such as Japan, China, Korea and India. A series of Export Ready workshops was held in regional locations and presented at a

integrated business accreditation program for inbound tour operators, was updated and placed live online as part of the Quality Tourism accreditation portal – www.qualitytourism.com.au.

China ADS Monitoring Group – ATEC was

actively represented on this group to manage and review the China ADS (Approved Destination Status) Code of Business Practice and to advise the commonwealth government on industry matters and issues relating to ADS and the China market.

Media workshops – Half-day introduction

to media and public relations workshops were held in Sydney, Brisbane and Cairns, with more to be held in other branches throughout the country as part of an ongoing program.

Awards for Excellence – The Most Outstanding Contribution by an Individual award was atx:magazine:yearbook2006

ATEC ANNUAL REPORT

ATEC walk-through of the ATE (Australian Tourism Exchange) floor and ran ATEC’s first ATE cocktail function with more than 150 attending, including a number of wholesalers.

Mega famil 2006 – In association with

Asia Tourism Advisory Panel – the panel,

which consists of representatives from key Australian-based Asian tourism operators, was re-established to address growing concerns over the performance of significant Asian markets.

Backpacker Tourism Advisory Panel – BTAP,

which comprises representatives from across the backpacker industry, continued its proactive stance on a number of issues including visas, tax, research and youth marketing efforts. BTAP’s lobbying efforts contributed to a number of successes during the year including the extension of the Working Holiday Maker Scheme from one to two years for holders who completed at least three months’ agricultural work, and the extension from three to six months of the maximum time visa holders could remain in a single job. BTAP continues to lobby on a number of fronts including the establishment of a working holiday type scheme for the American youth market.

Objective: A Focus on Influencing Policy Goal: Build and strengthen stakeholder presented at the Gala Dinner at Meeting Place in Sydney in December, and annual Awards for Excellence were presented at the Symposium Gala Dinner in Cairns in May.

Recipients included: Most Outstanding Contribution by an Individual

– Bob Lunnon, Director, Global Sales and Resorts in Asia Pacific for Starwood Hotels and Resorts

Most Outstanding Contribution to Industry – John Ward, Chairman Transonic Travel

Len Taylor Young ATEC Award for Excellence – Anna Guy, Tourism Australia

Awards for Excellence as nominated by inbound tour operators Day Tour Operator – Australian Wild Escapes Tour Operator – Exceptional Kangaroo Island Transport Operator – Murrays Travel Attraction – BridgeClimb Tourist Class Accommodation – The Grace Hotel

Deluxe Accommodation – Sofitel Melbourne

ATEC ANNUAL REPORT

Strategy: To develop a policy framework

that facilitates business opportunities for members.

Japan Policy Panel – the panel, which consists of key industry representatives of the Australian-based Japanese tourism industry, continues to tackle issues impacting on the market. A key concern during 2005/06 has been the continuing decline of the Japanese market. ATEC, through the panel and other initiatives, was also involved in the preparation of the Federal Tourism Minister’s Action Plan on Japan – aimed at addressing the decline in this market.

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relations to drive the tourism export policy agenda.

Strategy: Build federal a state government influencing interface.

Submissions - During the year we prepared

several submissions to the federal and state governments on a range of issues including: Labour shortages (two submissions) Tourism as a service industry The application of the GST to the distribution system. NSW state budget The Tax Refund Scheme for Tourism Shopping NSW State Plan

Advisory panels – we continued to represent the industry’s interests in Canberra via a number of panels, steering committees and advisory boards including: Tourism Visa Advisory Group National Tourism Alliance Tourism Minister’s Advisory Council National Tourism Aviation Advisory Committee Tourism Australia advisory panels Tourism Forecasting Committee White Paper Industry Implementation Advisory Group Tourism Portal consultative group Action Plan for Japanese Tourism Korean Action Plan Implementation Group

ATEC also played an advisory role in the development of the Queensland and Victorian tourism strategies and the NSW Masterplan.

Policy agenda – our policy agenda addresses

“big picture” issues such as visas, labour, tax, regulation, aviation, tourism shopping, EMDG scheme (Export Marketing Development Grant), and industry development.

Chairman’s dinners – as part of our role to be

seen as a major influencer of tourism policy, we hosted a series of dinners with business and government dignitaries in order to progress our policy agenda and maintain direct communication channels with key industry and government decision-makers. Chairman’s dinners featured the following guest speakers: Shadow Foreign Affairs Minister Kevin Rudd Immigration Minister Amanda Vanstone Greg Hunt MP Shadow Tourism Minister Martin Ferguson Assistant Treasurer Peter Dutton NSW Shadow Tourism Minister Katrina Hodgkinson Melbourne City Council CEO David Pitchford

Meeting schedule – throughout the year, we

initiated and/or attended scores of meetings Australia-wide with state and federal ministers and shadow ministers, ministerial advisors and departmental staff to present our industry’s policies with the aim of influencing government agendas.

Strategy: Work with Tourism Australia and

state tourism organisations to drive industry outcomes.

Tourism Australia MOU – a memorandum of

understanding between ATEC and Tourism Australia was developed and implemented in order to foster a closer working relationship between the two organisations.

Regional Tourism Advisory Panel – following feedback from our more than 40 regional tourism organisation (RTO) members, ATEC resolved to form a regional tourism advisory panel aimed at addressing issues impacting on regional products and destinations.

Strategy: Increase ATEC brand recognition with overseas stakeholders.

ATE – ATEC continues to have a strong

presence at the annual Australian Tourism Exchange (ATE) and will continue to promote the benefits of working with our members to overseas buyers.

EMDG status – ATEC has been granted export

market development grant “approved body” status by Austrade – allowing us to apply for grants to fund future overseas promotion of ATEC and our members.

atx: magazine – atx: magazine, the quarterly

publication which is the voice of the inbound tourism industry, is distributed to more than 5000 overseas wholesaler, Tourism Australia, state tourism organisation, Austrade and other industry contacts.

Objective: The Voice of Tourism Exports Goal: Be the respected and authoritative voice of the Australian tourism export industry.

Strategy: Increase recognition of tourism

export policy and economic impact by all governments.

Speaking engagements – Our staff are

regularly invited to meet and address government policy makers and to promote

the issues affecting the tourism export industry.

Political leverage – Politicians and their

advisors regularly attend our events including Symposium, Meeting Place and branch events. In the past year, the following politicians have attended ATEC events: Federal Tourism Minister Fran Bailey Federal Shadow Tourism Minister Martin Ferguson Federal Immigration Minister Amanda Vanstone Parliamentary Secretary for Tourism Bob Baldwin Former Federal Parliamentary Secretary for Tourism Warren Entsch Federal Member for Moncrieff Steven Ciobo NSW Tourism Minister Sandra Nori NSW Shadow Tourism Minister Katrina Hodgkinson Queensland Tourism Minister Margaret Keech Queensland Shadow Tourism Minister (former) Jann Stuckey South Australian Tourism Minister Jane LomaxSmith Victorian Tourism Minister John Pandazoplous Western Australian Tourism Minister Sheila McHale

ATEC Update – ATEC Update continued to be

ATEC BOARD

the key vehicle for latest industry information distributed to more than 3000 member contacts each fortnight.

The BITE – A special backpacker-specific

e-newsletter The BITE (Backpacker Industry Trade E-News) was developed through the Backpacker Tourism Advisory Panel and distributed to more than 500 contacts bimonthly.

atx: - A new high-quality quarterly industry

magazine was developed in association with ATEC member company Sampson Communications aimed at providing the industry and related stakeholders with wellresearched information on the issues affecting the inbound sector. The first issue of atx: (Australian Tourism Exporter) was launched at Symposium in May to excellent feedback. With a print-run of 5000, atx: is distributed to all ATEC members, plus Tourism Australia offices throughout the world; state tourism organisations and their international offices; state and federal politicians; Austrade and DFAT offices throughout the world and to more than 700 international wholesalers.

John King, Chairman

Media activities – Thanks to a proactive media

policy, ATEC features regularly in media comment regarding the tourism industry on a national, state and regional level. Our MD appears regularly as an industry spokesperson on the issues affecting the inbound sector. atx: magazine is also delivered to all Australian federal and state members and to local government mayoral offices.

Strategy: Be the conduit of tourism export policy for the Australian media.

Media releases – During the year, we: issued 77 media releases; conducted more than 50 radio and television interviews; ATEC’s view appeared in 245 national and regional newspaper stories and 147 web-based news stories. Just some of the issues we publicly commented on included: The “Where the bloody hell are you?” campaign Labour shortages Rogue tour operators ATEC Symposium GST Visas Working Holiday Maker Scheme Action Plan for Japanese Tourism

Strategy: Delivery of a comprehensive

communications program to the membership.

Website – During the year we developed and

Easy to search member directory Latest news Media centre Events Branch pages Member survey Exclusive access to member information

Goal: Develop organisational strength to deliver the long term viability of ATEC.

Vice-Chairman Rob Gurney - Qantas Airways

Strategy: Develop and strengthen the branch network.

Resourcing - Branch resourcing is a constant

focus for the national board. The National Board carefully reviews its resourcing of the branch network around the country to ensure that the ATEC brand is strong and that a range of quality events are delivered to all members.

Branch membership - We attracted 101 new members in the past 12 months.

Strategy: Maintain and enhance ATEC membership standards.

Membership Code of Business - During the year,

we reviewed and continue to uphold the ATEC Code to ensure compliance and continuous improvement. Members are strongly encouraged to abide by the code in all business dealings.

Strategy: Continual improvement of ATEC

business practice and operational efficiency.

National office review - A review was made

of national office policies and practices with the aim of finding and implementing new efficiencies. A board retreat was held in February as well as a staff retreat in August to review the key operational areas and strategies.

Strategy: Enhance the financial strength of the

Managing Director Matt Hingerty

ATEC branches council representative Vicky Uren, GTA

Japan industry representative Kazunori Yamaguchi - Japan Airlines

State tourism organiation CEO forum representative Richard Muirhead - Tourism Western Australia

organisation.

ITO member representatives

The ATEC Audit and Finance committee meets on a regular basis to ensure the financial viability of the organisation and to enable management to implement new programs and benefits to members.

Inga Afheldt - ATS Pacific - Sydney David Armour - Southern World Australia Kevin Carruthers - Pan Pacific Travel Australia Pty Ltd Mark Taylor - Pacific Spirit Travel Francis Wong - Encounter Australia

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ATEC ANNUAL REPORT

launched the new ATEC website with the aim of providing the most up-to-date information for members. New website features include:

Objective: From strength to strength

Supplier member representatives Peter Doggett - Warner Village Theme Parks Anna Guillan - Hayman Ron Livingston - Livingston Tourism Marketing Sudhir Warrier - Magistic Cruises and Sydney Showboats

Young ATEC representative Greg Daven - Kuranda Scenic Railway

ATEC Branch Contacts NSW Branch Manager Jennifer Woodbridge 02 8262 5514 jennifer.woodbridge@atec.net.au

South Queensland Branch Manager Don Jolly 07 5535 1289 don.jolly@atec.net.au

North Queensland Branch Manager Pip Miller 07 4046 4777 pip.miller@atec.net.au

Victoria/Tasmania Branch Manager Graeme Haycraft 03 9824 8673 graeme.haycraft@atec.net.au

South Australia Branch Manager Kent Rossiter 08 8331 1200 kent.rossiter@atec.net.au

Western Australia Branch Manager Rick Suermondt 08 9380 9394 rick.suermondt@atec.net.au

Australian Capital Territory Branch Manager Sarah Buchanan sarah.buchanan@atec.net.au

NT Central Branch Manager Kent Rossiter 08 8331 1200 kent.rossiter@atec.net.au

NT Top End Branch Manager

ATEC ANNUAL REPORT

Kent Rossiter 08 8331 1200 kent.rossiter@atec.net.au

Branch Committees

The following industry representatives were elected at branch annual general meetings throughout the year.

ACT Branch Committee Melanie Chettle (Chair) Director of Sales and Marketing Doma Hotels Canberra

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Clint Wright Tourism and Marketing Coordinator National Museum of Australia Doug Sarah Managing Director Cockington Green Lisa Mehonoshen Director AWT Travel Australia Marylou Pooley Manager, Marketing Australian War Memorial John King National Board Mentor - ACT Chairman – ATEC

NSW Branch Committee Vicky Uren (Chair) Regional Manager Oceania - Hotels Division GTA Australasia Michael Baker Manager, Stadium Tours Telstra Stadium Lee Clarke Market Coordinator - Eastern Hemisphere Tourism New South Wales Anna Guillan (National Board Mentor - NSW) Director of Sales & Marketing Hayman Anna Guy (YATEC Representative) Market Servicing - Tier 4 & Distribution Development Tourism Australia Dino Mezzatesta General Manager Hotel Ibis Sydney Airport Rob Sampson (Vice Chair) Managing Director Sampson Communications Australia Jodie Scott International Sales Manager Voyages Len Whittaker Sales Manager Captain Cook Cruises Jay Yip Business Development Manager Aus Wonder Travel

NT CENTRAL Branch Committee Warwick Rock (Chair/Treasurer) Operations Manager Connections Safaris Olivia Chandler Sales and Marketing Manager Alice Springs Desert Park Jeff Huyben General Manager Voyages Alice Springs Resort

Andrea Lehman Sales and Marketing Manager Desert Quads Mechelle Collins Director Alice Springs Helicopters Wayne Thompson Central Australian Manager Cobb & Co. Coaches Joc O’Connor General Manager Alice Private Tours Danielle Thomas Senior International Markets Coordinator Tourism NT Matt Hingerty (National Board Mentor - NT Central) Managing Director ATEC

NT TOP END Branch Committee Frances Fausett (Chair) Marketing Contractor Marambeena Resort Darwin Sylvia Wolf (Deputy Chair) Tourism Contractor Thrifty NT Louise Kitchingham Hotel Sales Executive SKYCITY Darwin Steve Frichot General Manager Saville Park Suites Darwin Melanie Reichlmeier Sales and Marketing Manager Odyssey Tours & Safaris Sallyann Lister Business Development Director InterContinental Hotels Group - NT Brett Binns Product Manager Northern Gateway Holidays Danielle Thomas Senior International Markets Coordinator Tourism NT Tony Clementson (Ex-Officio) General Manager Tourism Top End Matt Hingerty (National Board Mentor - Top End) Managing Director ATEC

NORTH QUEENSLAND Branch Committee Megan Bell (Chair) Director of Marketing Quicksilver Group Sharyn Brydon Marketing Executive - Events and North America Leisure Tourism Tropical North Queensland

Greg Daven (YATEC Representative) International Sales Manager Kuranda Scenic Railway Andrew Dineen Project Manager Parker Travel Collection Kellie Eustace General Manager Rydges Plaza Hotel Cairns Angela Freeman Director of Marketing Hartley’s Crocodile Adventures Cheryl Kelly Director of Sales & Marketing The Oasis Resort Cairns Sharon Livingston Director of Sales & Marketing Big Cat Green Island Reef Cruises Ron Lvingston (National Board Mentor - North Qld) Managing Director Livingston Tourism Marketing Gary Young General Manager Kuranda Scenic Railway Regina White International Sales Manager Tropic Wings Coach Tours

SOUTH AUSTRALIA Branch Regina Twiss (Chair) Sales Director North Adelaide Heritage Group Paul Brown Director Kangaroo Island Wilderness Tours Grant Burton General Manager Gray Line Adelaide Rosemarie Clemente Sales Manager Hilton Adelaide Caroline Densley Director Diverse Travel Australia Siggi Frede International Operations Manager South Australian Tourism Commission Fleur Honner Senior Business Development Manager Saville Suites Adelaide Drew Kluska Managing Director Outback Encounter Sonia Lefevre Director of Marketing Hyatt Regency Adelaide Tania Speck General Manager Warrawong Earth Sanctuary Francis Wong Managing Director Enounter Australia

SOUTH QUEENSLAND Branch Narelle Eichorn (Chair) Director of Sales & Marketing Outrigger Hotels & Resorts Paul Buggy International Market Development Manager Tourism Queensland Sharon Cauldwell Group Sales Manager Constellation Hotels Group Wayne Clift Managing Director Australian Day Tours Peter Doggett (National Board Mentor - South Qld) International Relationship Manager Warner Village Theme Parks Danielle Geddes Chief Executive Officer Riverlife Lidia Latimer International and National Sales Manager Harbour Town Outlet Shopping Centre Toufic Lawand Managing Director Operations Lawand Tourism Peter Smith QPIB Branch Manager - Brisbane AIB Insurance Brokers Jodie Sweeney (YATEC Representative) Business Development Manager The Albatross Travel Group Bruce White Director of Sales & Marketing Stamford Plaza Brisbane Robyne Wilson National Sales Manager S8 Resorts

VICTORIA/TASMANIA Branch Committee

WESTERN AUSTRALIA Branch Committee Stephanie Lang (Chair) Sales & Marketing Manager Seashells Hospitality Group Roger Baldwin Director of Sales Hotel Grand Chancellor Perth Natalie Bowden Marketing Executive Australia’s Coral Coast Brian Davis Inbound-Outbound Travel Manager Brian Davis Tours Edwin Kwan General Manager Wel-Travel (Aust) James Kwan (National Board Mentor) Managing Director Wel-Travel (Aust) Kerri-Anne Minns Business Development Manager - Inbound/ Wholesale InterContinental Burswood Resort Hotel Noeleen Pearson Chief Executive Officer Experience Perth

Financial Report

Annual finances are audited by HLB Mann Judd and presented to the subsequent Annual General Meeting in December.

Managing a tourism industry association such as ATEC for a sustainable financial future is not an easy business. Unlike other industry associations in the mining, agricultural and manufacturing sectors, tourism is not blessed with a capacity to engage a broad-based, equitable “grower’s levy” to fund its association activities, lobbying and research development. Nor, as in other sectors of the service economy such as the banking or insurance sectors, can we rely on a large range of major commercial entities to bank-roll us.

Revenues

So associations such as ATEC must fund themselves from the hard-earned resources of a large range of small to medium-sized enterprises via annual membership fees, event attendance and sponsorships. The few major commercial entities available to ATEC already support us strongly through corporate partnerships. This means that ATEC’s finances are, to a degree, captive to the overall performance of the industry and in some cases influenced by uncontrollable external events.

The Challenge As we entered the 2005-2006 financial year it is fair to say that ATEC was in a challenging if not alarming financial position. The export industry was suffering the effects of three years of negative growth post September 11 and both membership and event revenue in 2004-2005 were down against the budget. The result was that the budget for that year was not met and there was a draw-down on the organisation’s cash reserves. At its annual retreat in early 2005, ATEC’s National Board resolved that measures would be taken to ensure the ongoing sustainability of the organisation. Management policies were discussed with the ultimate objective of lifting the cash reserves of the organisation equivalent to four month’s operating costs against the risk of revenues being impacted by a significant industry down-turn or catastrophic event. Budgeting was to be conservative and constantly reviewed against company objectives. At the same time, however, it was stressed that services to members should in no way be reduced and should, in fact, be improved.

Process The financial performance of the organisation is reviewed against budget by the Audit and Finance Committee of the National Board. Chaired by Kevin Carruthers, the A&F committee met on 11 occasions in 2005-2006. The committee then reports to each board meeting.

Revenues grew by $269,209 in 20052006, helped by strong growth in membership revenues and a good financial result from Meeting Place and, in particular, Symposium. Corporate Partner revenue also grew. ATEC also received a grant from the Department of Industry Tourism and Resources to develop the Export Ready online training modules.

Expenditure Overall expenditure had been significantly tightened in the closing period of 2004-2005 and in the budgeting for 2005-2006. ATEC shed the equivalent of one-and-a-half full-time staffing positions. Nevertheless, there were a number of items of capital expenditure that had been deferred which could no longer be so. While the main impact of the move of head office from William St to Sussex St had been absorbed in the 2004-2005 period, there was an urgent need to upgrade ATEC’s information technology infrastructure and along with that to refresh the brand and renew a modest portfolio of membership collateral. This project was put to tender, which was won by COGS, and was delivered ontime and on-budget. Another expenditure item to significantly impact the budget in both 2004-2005 and 2005-2006 was the decision to rejoin the National Tourism Alliance as a Tier 1 member. A significant development for 20052006 was the publication for our magazine, atx: The magazine is a self-funding project which may provide ATEC with a revenue stream in the future, dependent on advertising subscriptions.

Outcome The ATEC board was pleased to note a significant turn-around in ATEC’s budget outcome in 2005-2006. Prudential management combined with increasing revenues resulted in a reasonable surplus. This surplus lifted the organisation’s reserves to $363,031. Full details of the financial outcome for 2005-2006 can be found by members on the ATEC website.

Looking ahead Similar budgetary outcomes to 20052006 would see the board’s financial reserve target met by 2007-2008, at which stage the board may wish to review the Corporate Plan. Nevertheless, management will continue to examine new revenue streams to further enhance services to members.

atx:magazine:yearbook2006

ATEC ANNUAL REPORT

Greg Dallas (Chair) Director Eipicurean Food and Wine Tours Nigel Aldons Business Development Manager North Asia Tourism Victoria Yann Duroselle Executive General Manager Batman’s Hill Hotel Karen Fraser General Manager International Marketing

Tourism Tasmania Renee Greaves Group Sales and Marketing Manager Hotel Lindrum Nicole Hill International Sales Manager Phillip Island Nature Park Maree Martin Tourism Marketing Manager Museum Victoria Ian McDougal International Market Operations Manager Tourism Victoria Paddy McLeod Business Development Manager Langham Hotel, Melbourne Kathie Sikkes General Manager - (Product) Abercrombie & Kent (Aust)

ATEC MEMBERS

Historic - 10 - 19 yrs, 20 - 29 yrs and 30+ years contribution MEMBERS: 30+ YEARS

AAT Kings Tours Australian Pacific Touring Captain Cook Cruises ID South Pacific Tour Hosts Destination Management

ATEC ANNUAL REPORT

MEMBERS: 20 - 29 YEARS

ATS Pacific - Sydney Australian Farm Tourism Pty Ltd Avis Australia Bay Village Tropical Retreat Bob Wood Travel Group Pty Ltd Budget Rent-A-Car Australia Cairns Colonial Club Resort Carlton Crest Hotel - Brisbane Choice Hotels Australasia Cobb & Co Coaches - Melbourne Conrad Jupiters Contiki Holidays (Australia) Pty Ltd Destination Cairns Marketing Dreamworld Federal Hotels & Resorts Four Seasons Hotel Sydney Gold Coast Tourism Hamilton Island Hertz Australia JTB Australia Pty Ltd - Cairns JTB Australia Pty Ltd - Melbourne JTB Australia Pty Ltd - Sydney Magistic Cruises Murrays Travel - NSW Pacific International Hotel Pan Pacific Travel Australia Pty Ltd Qantas Airlines Qantas Holidays Quadrant Australia Pty Ltd Quality Hotel Cambridge Quicksilver Group of Companies Restaurants of The Rocks Rydges Tradewinds Cairns Sofitel Wentworth Sydney Southern World Australia Sovereign Hill Spirit of Tasmania Starwood Hotels & Resorts Sydney Opera House Sydney Tower Restaurants Taronga Zoo Thala Beach Lodge The Menzies Sydney, An Accor Hotel The Windsor - An Oberoi Hotel Thrifty Car Rental - National Office Tourism Australia Tourism New South Wales Tourism NT - Darwin Office Tourism NT - Sydney Office Tourism Queensland Tourism Victoria Tourism Western Australia Tropic Wings Coach Tours Warner Village Theme Parks

MEMBERS: 10 - 19 YEARS Abercrombie & Kent Acacia Luxury Transport - FNQ Acacia Luxury Transport - SEQ Accommodation Down Under Accor (AAPC Ltd)

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Accor’s Brisbane Hotels Accor’s Darling Harbour Hotels Adventure Duck Adventure Tours Australia Ananda Travel Service Angsana Resort & Spa Great Barrier Reef Around Australia Tour Service Aurora - Hotels - Resorts - Attractions Australia Bound Travel Pty Ltd Australia New Zealand Travel Marketing Australian Capital Tourism Australian Day Tours Australian Institute of Sport Australian National Maritime Museum Australian Pacific Touring - Melbourne Australian Tours Management Pty Ltd Australian Vacations Australian Vacations Australian Wild Escapes Aviation Travel Services Ballooning With Hot Air Bathurst Visitor Information Centre Bayview International Hotels & Resorts Beehive Australian Inbound Tour Service Best Western Australia Big Cat Green Island Reef Cruises Binna Burra Mountain Lodge BlueFire Cruises Brisbane Airport Corporation Limited Brisbane Marketing Broken Hill Regional Tourist Association Cable Beach Club Resort Broome Cairns International Hotel Cairns Reef Charter Services Cairns Tropical Zoo Captain Cook Cruises - Nth QLD Captain Cook Cruises SA - PS Murray Princess Carlson Hotels Asia Pacific Carlton Crest Hotel - Melbourne Carlton Group of Hotels Central Coast Tourism Inc. China Travel Service (Aust) Choice Hotels Australasia - NSW Coachtrans Australia Cockington Green Connections Connections Australia Constellation Hotel Group Coral Princess Cruises CountryLink Sales Couran Cove Island Resort Courtyard by Marriott Surfers Paradise Resort CP Tours Crowthers Coaches Currumbin Wildlife Sanctuary DFS Australia Gold Coast DFS Australia Sydney DFS Galleria Cairns Doma Hotels Canberra Double Bay Inbound Travel Down Under Tours Australia EcoPoint Resorts Encounter Australia ERM Travel Service BNE Pty Ltd Exceptional Kangaroo Island Experience Tours Australia Pty Ltd Exportise Extragreen Holidays (Aust) Pty Ltd Fantasea Cruises Finesse South Pacific Travel Fraser Coast South Burnett Tourism Board Frontier Camel Tours General Travel Australia Globus & Cosmos Tours

Gold Coast International Hotel Golden World Travel Goway Travel Grand Hyatt Melbourne Gray Line Melbourne Great Southern Railway Great Southern Touring Route Hard Rock Cafe - Sydney Hayman Hilton Adelaide Hilton Hotels Of Australia Hilton Hotels of Australia - Brisbane Hilton Hotels of Australia - Cairns Historic Houses Trust of NSW Holiday Pacific - Surfers Paradise Hunter Regional Tourism Organisation Hunter Resort Country Estate Hunter Valley Wine Country Tourism Hyatt International Hotels & Resorts Hyatt Regency Adelaide Innkeepers Marketing Pty Ltd InterContinental Hotels Group - ACT InterContinental Hotels Group - NSW InterContinental Hotels Group - NT InterContinental Hotels Group - Nth QLD InterContinental Hotels Group - Sth QLD Islander Resort Hotel Jade Express Travel Jalpak International Oceania Pty Ltd JMD Ross Insurance Brokers Pty Ltd Kangaroo Island Odysseys Kangaroo Island Sealink Kingfisher Bay Resort & Village Kintetsu International Express Oceania Pty Ltd Kintetsu International Express - SEQ Lasseters Hotel Casino Lawand Tourism Leeton Tourism Lilianfels Blue Mountains Lion International Travel Service Pty Ltd Lone Pine Koala Sanctuary Luxury Personalised Tours (Lygon Limousines) Melbourne Observation Deck Melbourne River Cruises Mercure Hotel Harbourside Cairns Metro Hospitality Group Mirambeena Resort Darwin Mirvac Hotels Pty Ltd Mount’N Beach Safaris Pty Ltd Murrays Travel - QLD National Trust of Australia (Victoria) New World Tours Nippon Travel Agency - NSW Northern Gateway Novotel Atrium Darwin Novotel Langley Perth Novotel Rockford Palm Cove Resort Oceanworld Manly Odyssey Travel O’Reillys Rainforest Guesthouse Orient Express Hotels Orpheus Island Resort Outback Ballooning Pty Ltd Pacific Spirit Travel Palm Royale Cairns Phillip Island Nature Park Port Stephens Tourism Limited Premier Stateliner Coach Group Pro Dive Cairns Puffing Billy Steam Railway QH International Queensland Rail Queenslander Hotels - Cairns Radisson Treetops Port Douglas Redcliffe City Council Rendezvous Hotels Australia

Rendezvous Observation City Hotel Perth Royal Pines Resort Rydges Hotels & Resorts Rydges Melbourne S8 Resorts Saville City Suites Adelaide Saville Hotel Group Seavane Pacific Tours Shangri-La Hotel Sydney Sheena MacAlister Sheraton Mirage Port Douglas Shoji Australia Shopping Spree Tours - Melbourne Sita Coaches Pty Ltd SKYCITY Darwin Pty Ltd Sofitel Brisbane Sofitel Melbourne Sofitel Reef Casino Cairns South Australian Tourism Commission Southbound Australia Southern Travelnet Pty Limited Stamford Grand Adelaide Stamford Hotels & Resorts Star City State Transit Tourism Services Stella Resorts Group - NSW Summit Restaurant Sunlover Cruises Surfers Paradise Marriott Resort Sydney Airports Corporation Sydney Attractions Group Sydney Convention & Exhibition Centre Sydney Harbour Foreshore Authority Tailormade Tours & Airport Limousines Tangalooma Wild Dolphin Resort Terra Nova Coach Tours Pty Ltd Territory Thrifty Car Rental - NT The AOT Group Pty Ltd The CENTRAL Group The Grace Hotel The Horizon at Mission Beach The Mansion at Werribee Park The Observatory Hotel THL Rentals Time Travel Pty Ltd Tjapukai Aboriginal Cultural Park Tour Pacific Australia Tourabout Adelaide Tourism Sunshine Coast Tourism Tasmania Tourism Tropical North Queensland Tourism Whitsundays Tournet Australia Townsville Enterprise Limited Trailfinders/Bloomfield Rainforest Lodge Transglobal Tours Tropical Fruit World Undara Experience Underwater World - Sunshine Coast Unique Australian Holidays United Travel Corporation (Aust) Pty Ltd Voyages Waratah Adventure Tours Wayward Bus Touring Company Wel-Travel (Aust) Pty Ltd - WA Wooroonooran Safaris YHA Australia

Young ATEC (YATEC) is an initiative of the Australian Tourism Export Council to support the youth of Australia’s tourism export industry. YATEC members are committed tourism professionals from all parts of the industry who strive to develop their industry knowledge and build strong networks. YATEC has experienced significant member growth nationally over the past 12 months. Branch committees are working consistently across all states to provide learning opportunities for the benefit of all YATEC members and for the future of this dynamic industry. The YATEC Mentoring Program is one key initiative established to provide a platform for new members to meet with senior members

of the industry and work with their peers to discuss current issues facing inbound tourism. The program ran throughout October and November in NSW and is gaining momentum year-on-year as participant numbers have doubled from 2005.

Q&A

This program is highly successful as it provides YATEC members with the opportunity to learn from senior members of the industry who present on topics relating to tourism, career development and networking. It also provides the opportunity for them to work personally with a senior member of the tourism industry on individual career development and planning. The program is currently in planning to be rolled out by other YATEC committees throughout Australia in 2007.

Best Western Sales Executive Mentor program graduate 2005

Angela French

What inspired you to join the mentoring program? It was a good opportunity to learn more about the industry and, working for a supplier, to gain an insight from inbound tour operator, and government perspectives. I was encouraged by my employer to participate as a colleague had previously been involved. What was the highlight of the program? For me there were two highlights… The sessions and meeting up with my mentor were important parts of the program, but working with the other mentees on the final presentation and then finally the actual presentation were definitely highlights. What were the most significant things you learned?

YATEC BRANCH INITIATIVES 2006

YATEC NSW

YATEC SA

• Brochure distribution of YATEC flyers to all ATEC NSW members.

• March - Motivational speaker/career development function with Mia Hanshin. • June - ATE walk through.

• Regular YATEC newsletter distributed to all members.

• September - motivational speaker function. Christina Seeliger, Tranquil Travel, and Craig Wickham, Exceptional Kangaroo Island.

• Two successful educational events covering topics:

• October - Bingo night with Youngbloods Association. This was held recently in conjunction with Youngbloods, with all funds raised going towards the Australian Red Cross.

• Dale Carnegie effective communication

YATEC WA

• Niche markets

• 2006 saw the YATEC committee in WA ‘reborn’! The committee now comprises of six enthusiastic members representing a range of tourism products from all facets of the industry.

• Work / life balance

• September - Chairperson, Natalie Bowden gave a YATEC report at the ATEC AGM. • December - For the first time, the WA branches of ATEC and YATEC joined forces for the 2006 Christmas function. • ATEC mentoring program in WA is hoped to be underway by mid 2007.

• Career in inbound

How beneficial was it having a mentor in the industry? For me, I found it particularly beneficial. Having been in the industry at that time for not even 12 months and to be given an insight into the past trends enabled me to extend my knowledge and understanding. Did you meet any people who have helped you?

• Social / games network evening

Throughout the program, my mentor gave up his time to meet me with me to discuss questions I had and provided me with information that he thought I would find useful. There are also other mentees that I keep in contact with, which is good when it comes to social events etc.

• Hunter Valley wine tour

What would you say to others?

• Christmas party

When participating in the program, take advantage of all the opportunities to meet people and participate and try to take in as much as you can, as a year on I look back now and remember key things that are helping me in what I do today. Always show initiative and take opportunities like this program in your stride as they will be valuable experiences for your career in this industry.

• Direct marketing in the tourism industry

• Mentoring program

YATEC QLD • February - Cultural Sensitivities function, about 30 members attending. • May - YATEC’s Mid Week Mania was held at Symposium in Cairns. • August- YATEC trivia night • November – Christmas function “10 tips of surviving the office Christmas party”.

atx:magazine:yearbook2006

ATEC ANNUAL REPORT

• August - YATEC members were given the exciting opportunity to take a ‘walk-thru Western Australian Tourism Exchange’ and gain an insight into this premier Western Australian trade event.

• Changing nature of the distribution system

The program put a lot of things into perspective for me and I learnt that everyone in the industry and the roles that we are in are small pieces of a large puzzle that makes an international guest’s experience in Australia.

atx: feature

AMERICAN PSYCHE The changing mindset of the US traveller

September 11: five years on, Kerri Anderson looks at how the US market has changed When New York’s Twin Towers came crashing down on September 11, 2001, so did the world’s travel industry. Americans, already with one of the lowest levels of passport ownership in the western world (around 20 percent compared to Australia’s 38 percent) hunkered down.

atx:magazine:yearbook2006

Slowly however, the global travel market, including the US, began to recover as travellers realised they were living in a changed world. In 2005 a record 808 million people worldwide travelled overseas. An October 2006 report by the US Department of International Trade Administration (ITA) revealed the US outbound market grew by three percent last year, marking a new record for total US outbound travel as 28.7 million US residents travelled overseas. The top five overseas destinations were the UK, France, China (People’s Republic and Hong Kong), Italy and Germany, while the fastest

growing destinations were Dominican Republic, Japan, India, and China – all with double digit growth. By comparison, the US market to Australia grew by 2.3 percent during 2005 with 413,400 Americans making the trip Down Under.* A five percent increase is expected over the next decade. With around two percent of the US outbound market, Australia ranks in the mid-teens on the list of most popular destinations. Mexico and Canada, because of their close proximity, are Americans’ two favourite foreign destinations, followed by the UK, steady at number three (3.7 million *Source: International Visitor Survey

atx: americanpsyche “Fewer people now take an entire two week vacation which is pretty much what they would need coming to Australia.”

shifting in response to the forces of politics, security and money.

visitors in 2005), and France (2.3 million visitors). The People’s Republic of China, which in 2000 was the 17th most visited destination with 644,000 visitors, had risen to 6th place by 2004 with 1.8 million visitors.

Travel composition, she says, is also moving away from traditional couples/families to a mix of generations – friends and family, single sex, spiritual travel and more.

Given the popularity of “exotic” destinations such as China and Japan, does Australia still have what Americans want in a holiday? Mark Orwoll, Senior Consulting Editor for top-ranking US luxury travel magazine, Travel+Leisure and Executive Editor/International American Express Publishing, says Australia has a reputation that is unparalleled, but a big challenge is Americans’ changing travel patterns towards shorter, more frequent trips – a real barrier for destinations such as Australia. “Fewer people now take an entire two week vacation which is pretty much what they would need coming to Australia,” Orwoll says. “Any less and people won’t feel as though they are getting their money’s worth.” While he sees emerging destinations such as China, south east Asia, India and South Africa as major competitors, he emphasises that the lure of Australia’s traditional attractions can’t be underestimated – particularly for the first and second time visitor. “Travellers of the next level however are looking to delve much deeper and have ‘authentic’ experiences, Orwall says. “They want to meet Aboriginal people, see where they live and learn about their history, but the average person wouldn’t have a clue even where to begin. “This is one of the opportunities that the Australian industry faces and it is an area for potential growth.” Peggy Bendel, Senior Vice President of New York-based PR consultancy, Development Counsellors International (which currently holds the Tasmania account), says Americans’ travel patterns are constantly

“Australia is rich in experiences that are of interest to Americans and another strong draw is the perception that Australia is a welcoming destination,” she says. Like Orwoll, Bendel says Americans today travel to experience a destination – to birdwatch, flyfish or learn a new skill.

So if Australia has what Americans are looking for, what can be done to achieve more than modest growth out of our fourth largest market? David Armour, Sydney-based Managing Director of inbound tour operator Southern World Australia, says the US market has never lived up to expectations and while

“There will be minor issues or unplanned changes to services, but one of the biggest problems we have is with suppliers not dealing with these issues quickly, or in our minds, correctly. “This only causes small problems to become big ones, something that could have been avoided if handled properly in the first place.” One product which has successfully worked in the US market for 14 years is Fraser Island’s awardwinning Kingfisher Bay Resort.

“There are a lot of segments that get overlooked like the student market.” it is growing, he can’t imagine it ever suddenly taking off. Armour says increasingly, his clients are looking for a vacation that focuses on individual needs rather than mass marketing. “We need to forget about passenger numbers and look at niche marketing and make sure clients have a great experience – it’s totally about value for money, not about what it costs. “For us it’s about finding niche operators that can really make an itinerary something special.” The challenge however, Armour says, is in mixing and matching product and service levels, something he believes Australia needs to do better and can do well to learn from New Zealand. “New Zealand has done a much better job in selling itself as a niche product,” he says. “You have to ask [clients] what they have done in the past. Uluru is a perfect example – some people get it and some people don’t and it’s a long way to travel to look at a rock in the desert if you’re one of those people who don’t.

International Sales Manager, Genevieve Maher, who has been travelling to the US since 2001, says Australia has great experiences and the key is to find untapped markets. “There are a lot of segments that get overlooked – like the student market,” she says. “This is one of our most popular markets out of the US and we get thousands of room nights annually through youth travel companies. “Other special interest market segments such as non-profits, families, birdwatchers and retirees etc, offer great potential and we continue to focus on these niche markets.” In pursuit of the lucrative youth market, the tourism industry has been lobbying both the Australian and US governments to introduce a working holiday style visa for young Americans with an announcement expected in the near future. Michael Londregan, Tourism Australia’s Los Angeles-based Vice President for The Americas, agrees that the psychographic of the American traveller has changed dramatically in the years since September 11. atx:magazine:yearbook2006

atx: feature Australia/USA route Data Source DOTARS* Passengers (‘000s) DOTARS* Seats (‘000s) DOTARS* Seat Factor

1992 1,516 2,237 67.8%

1993 1,448 2,225 65.1%

1994 1,292 1,865 69.3%

1995 1,293 1,885 68.6%

1996 1,437 2,271 63.3%

1997 1,470 2,182 67.4%

1998 1,509 2,230 67.7%

1999 1,556 2,295 67.8%

2000 1,623 2,341 69.4%

2001 1,753 2,496 70.2%

2002 1,532 2,069 74.0%

2003 1,458 1,819 80.2%

2004 1,566 1,922 81.5%

2005 1,714 2,182 78.5%

2006 1,842 2,307 79.9%

Visitor arrivals from the USA to Australia ABS**

Visitor arrivals

from USA (‘000s)

283.2

270.5

287.2

295.1

310.4

321.3

355.7

393.8

436.9

502.1

424.3 423.5

430.3

445.6

452.4

*Department of Transport and Regional Services **Australian Bureau of Statistics

One of the most fundamental changes he says, is that Americans, traditionally seen as highly insulated, are becoming worldlier. “More Americans are watching BBC news than ever before and they are hungering for a world perspective. “They have had to learn about Asia as they are doing more business there, about the Middle East, and about diplomacy with their allies.” He says that just because there are as many Americans travelling now as in 1999 doesn’t mean it’s the same Americans, that they’re travelling to the same regions, or that their priorities are the same. “In 1999 we were marketing a lot of set itineraries and in 2006 there is none of that – everyone wants their holiday personally designed. “The priorities of safety and security are also much further up the list as key drivers of destination choice.” One thing that hasn’t changed however is the challenge of converting Americans’ aspiration to visit Australia into real travel. Despite a series of campaigns and incentives since the benchmark Hogan campaign of the 1980s, little headway has been made in growing Australia’s market share. “We’ve come to the realisation that getting people to think positively about us and put us on their wish list is not going to drive visitation alone,” Londregan says.

atx:magazine:yearbook2006

So what is Tourism Australia doing to try to shift aspiration into action? The introduction of the Aussie AirPass (a return airfare which includes a number of domestic legs - see research snapshot on the following pages) in 2003 has been a true success story according to Londregan. Described as Australia’s version of the Eurail pass, 40,000 Aussie AirPasses have been sold in the past three years. Londregan says Tourism Australia is also working aggressively to grow its inmarket trade activities, expand its online training program and bring record numbers of agents to Australia. The G’day LA program – begun as a relatively small series of events in Los Angeles in 2004, now includes a series of key events involving Australian food and wine, fashion, film and celebrities. Next year the program will be expanded to New York. On the consumer front, the australia.com website has moved from number three to the number one website for Americans planning a holiday to Australia, according to Londregan, with half the site’s five million global visitors coming out of North America. The “Bloody Hell” campaign is yet to make an impact however as Londregan says it was introduced at the tail end of the States’ campaign season early in the year and has only just kicked off again.

“More Americans are watching BBC news than ever before and they are hungering for a world perspective.”

atx: americanpsyche “Airfares are competitively priced and last year and this year we have offered the Aussie AirPass product for under US$1100 [and continue] to offer competitive fare sales in the market below US$1000.” Of course, one cannot look at the US market without looking at aviation and the criticisms that growth is being held back because of a lack of competition and high airfares.

He says it is no good getting airlines such as Virgin, or ultimately Singapore, to enter the market and achieve only an incremental growth as everyone will struggle.

David Armour is one who believes the perception of a destination is based on its airfare.

“I’m convinced that additional carriers on the route would lead to a drop in fares and a growth in the market. I’m not convinced that it would be a sustainable outcome.”

“When [Americans] see those expensive airfares I think they think Australia overall is going to be a much more expensive destination,” he says. “Once you put air and land together for a European trip I think it ends up being more expensive than coming here and we’ve tried to do the comparison that we are quite competitive but we still get reports that Australia is expensive.” Currently only Qantas and United fly direct from the US to Australia but speculation is strong regarding Virgin Blue’s intentions to enter onto the route. At the moment, Virgin is remaining circumspect, however.

In Cain’s opinion, the real goal should be to build a plan that doesn’t just look at growing the market by two or three percent, but by 20 or 30. “The industry – ITOs, US-based wholesalers, airlines, Tourism Australia etc - need to be working on that objective and working back to see what strategies we need to have in place to achieve it. “Our share of the US market is quite small and there is potential to grow it significantly.” Qantas however does not believe such growth is feasible.

“We have made no secret of our desire to introduce competition onto the route,” the airline’s Public and Media Relations Manager, Amanda Bolger, says.

“The US market is a mature one and the prospect of doubling traffic over a medium time horizon is not realistic,” says the airline’s Group General Manager, Sales and Distribution, Rob Gurney.

“Critical to Virgin Blue being able to move forward is daily access rights as at the moment there are only four flights a week available. This is something that is currently being worked.”

Gurney says the airline is not aware of comments that limited competition and the perception of expensive flights on the route are an impediment to the market’s growth.

Aviation analyst Bob Cain, says the Pacific route historically has performed well for two carriers, but struggles as soon as additional ones are introduced.

“Research that we have seen shows that perceived distance and time away are the key barriers to the purchase of leisure travel,” he says .

While he says it is one of Qantas’ better performing legs, its success lies in its reasonably large “front end load” – the business sector.

“Airfares are competitively priced and last year and this year we have offered the Aussie AirPass product for under US$1100 [and continue] to offer competitive fare sales in the market below US$1000.”

“The problem is that this segment isn’t large enough to go around a number of carriers. “We have had a succession of carriers who come in, drop prices, compete for a while and then bail out.”

Qantas’ thoughts on Virgin entering the market? “If Virgin were to enter the route we would compete strongly with them as we do with any of our competitors,” Gurney says. Given Tourism Australia’s close working relationship with Qantas, Londregan is circumspect on the question of the effect of limited competition on the route. “Primarily people end up going to the country they most want to go to,” he says. “The initial job is to convince them that they can get something in Australia they can’t get anywhere else and have a reasonably priced airfare to do it. “The reality is that arrivals to our country from America are growing almost exactly in line with capacity growth. “We would look forward to working with any great new partners on the route – airlines, wholesalers etc.” So, in the end, it seems the prognosis for the US market is positive, but not outstanding.

“The initial job is to convince them that they can get something in Australia they can’t get anywhere else and have a reasonably priced airfare to do it.” Genevieve Maher has some sage advice to offer any operator considering entering the US market. “Patience – it’s the only strategy you can have. It’s a unique market, it’s hard work and can be incredibly frustrating, but if you talk to people, work with your partners and do your research to make sure your product is tailor-made, you’ll be ahead of the game.”

He says that by January 2007, the Qantas Group will have grown capacity on the route by almost 50 percent over the past five years.

atx:magazine:yearbook2006

atx: researchsnapshot

Analysis undertaken by Tourism Research Australia (TRA) has found that the number of US leisure visitors to Australia increased by six percent on average in the two years to June 2006, to reach 267,000. This growth was underpinned by visitors who had between two and four stopovers: consistent with the three domestic stopovers allowed on the airpass. Over the past two years, the number of US leisure visitors who had between two and four stopovers in Australia increased by 13 percent (to 110,000), whereas those

Of the US leisure visitors who had between two and four stopovers in 2005/06, 72 percent stayed in Sydney, 35 percent in Tropical North Queensland (TNQ), 34 percent in Melbourne and 15 percent in Brisbane — all regions on the east coast of Australia. The number of US leisure visitors to all these regions has increased since 2003/04, with average annual growth ranging from 11 percent in Sydney and Melbourne to 31 percent in Brisbane. Sydney, Melbourne and Brisbane are the major points of entry for visitors from the US with direct flights available to all three cities. During 2005/06 around 80 percent of all US arrivals and departures into Australia were through these cities. During the two years to 2005/06, there were four main travel itineraries undertaken by US leisure visitors who had between two and four stopovers in Australia. These travel itineraries focused around: 1. Melbourne in combination with Sydney, Brisbane, Adelaide and the Gold Coast (36% of visitors) — Melbourne focused. 2. TNQ and Sydney in combination with

Number of stopovers in Australia by US leisure visitors, rolling annual June 2000 to June 2006

Melbourne and Petermann (Uluru) (31% of visitors) — TNQ/Sydney focused. 3. Sydney in combination with other regions along the east coast of Australia including Melbourne, Brisbane and the Gold Coast (28% of visitors) – Sydney focused. 4. Perth and Australia’s North West regions in WA, home to Broome and the Kimberley. The WA regions were visited in combination with Sydney and Melbourne (5% of visitors) – WA focused. In terms of the travel itineraries described, the highest proportion of visitors in all itineraries arrived and departed from Sydney. For the Melbourne, Sydney and WA focused itineraries, most visitors arrived and departed through Melbourne and/or Sydney. In contrast, for the TNQ/Sydney focused itinerary, most visitors arrived and departed either through Sydney and Brisbane or Sydney and Cairns. The number of US leisure visitors who stayed overnight in multiple regions in Australia has increased since the introduction of the “Aussie AirPass”, although dispersal is still concentrated around the traditional destinations on the east coast. Furthermore, Tourism Australia and Qantas have developed a similar style of airpass for promotion in the UK and Germany to also encourage travellers from Europe to visit multiple regions in Australia. Dr Darrian Collins

US visitors who had two to four stopovers, to selected regions, rolling annual June 2000 to June 2006

Tourism Research Australia (TRA) undertakes research projects on domestic and international travel in Australia. This article is part of a larger research project on multidestination travel itineraries of international visitors in Australia. For further information contact TRA on 02 6228 6100 or tra@tourism.australia.com. 44

atx:magazine:yearbook2006

Source: TRA International Visitor Survey (unpublished data)

One such initiative is the “Aussie AirPass” for US visitors to Australia that was introduced at the end of 2004 as part of a joint threeyear cooperative marketing agreement between Qantas and Tourism Australia. The airpass includes return international flights to Australia and Qantas flights for three domestic sectors in Australia. So has this initiative affected the number of stops US visitors have in Australia?

who had only one stopover increased by only one percent (to 92,000). Furthermore, the latest results from TRA’s International Visitor Survey (IVS) found that 51 percent of visitors who had between two and four stopovers departed Australia on a Qantas flight in 2005/06, 19 percent more visitors than two years earlier.

Source: TRA International Visitor Survey (unpublished data)

In recent years, there have been a number of initiatives from government and the tourism industry to encourage international visitors to disperse throughout Australia.

atx: tribute When Steve Irwin died suddenly on September 4 in the warm waters of the Great Barrier Reef, killed by a stingray’s barb while filming scenes for a documentary, the full extent of his worldwide fame was finally felt in Australia. More than 4,500 television news stories about his death were aired in the USA alone, highlighting the popularity he had gained in this important tourism market. It was unsurprising to those who had sought and gained Irwin’s help in campaigns to promote Australian tourism. Tourism Australia’s Vice President The Americas, Michael Londregan said Irwin had made an unequalled contribution to Australia’s tourism industry in the US. “He was the bright, passionate face of Australia. People, particularly here in the US, saw in him what they most love about our country, and they loved him for it,” he said. “It’s impossible to quantify the impact Steve’s presence and support had. It’s just immeasurable.” For the past two years, Irwin fronted live shows for Tourism Australia during G’Day LA, a week of tourism and trade promotions for which he volunteered his time. His generous contribution to many projects for Tourism Australia included television and radio appearances and walking the red carpet – a situation in which he was not always comfortable. “He did everything we asked and more – and always with boundless enthusiasm and energy. He drew the spotlight and as a result we were able to get our message about Australia out to millions of Americans,” said Londregan. Tourism Queensland’s Regional Director The Americas, Jonathon Day, dealt with Irwin many times over the years as he gave his time and talent to promote Queensland.

Steve Irwin Lee Mylne looks at the life of a passionate Australian

Crocodile hunter, conservationist, film-maker, businessman, family man… these were just some of the many faces of Steve Irwin.

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46 atx:magazine:yearbook2006 Phone 07 4051 0444 or visit www.bigcat-cruises.com.au

Enjoy a calm water cruise along the picturesque Trinity Inlet and discover the secrets of this unique mangrove-lined waterway, home to a rich and array of wildlife including crocodiles, native birds and over 70 species of fish. Phone: 07 4031 4007 or visit www.cairnshabitatcruises.com.au

atx: steveirwin

“He was the bright, passionate face of Australia. People, particularly here in the US, saw in him what they most love about our country, and they loved him for it. It’s impossible to quantify the impact Steve’s presence and support had. It’s just immeasurable...” “Anyone who met him was impressed by his dedication and enthusiasm. He was larger than life on TV because he was larger than life in life - there was no pretence,” said Day. “The tourism industry, especially in North America, has nothing but the utmost respect for Steve and his family.” Steve also donated his time to the Australian Made campaign to lift Australian exports to the USA, and was the face of the Australian Quarantine and Inspection Service. Born in Victoria in 1962, Steve moved to Queensland’s Sunshine Coast in 1970 when his parents, Lyn and Bob, opened a small reptile park at Beerwah. When his parents retired in 1991, Steve took over the business, renaming it Australia Zoo in 1998 to better reflect its nature and growing size. Today, Australia Zoo attracts almost a million visitors a year.

In 1992 Steve made his first wildlife documentary, The Crocodile Hunter. Its success quickly led to more, eventually reaching 500 million viewers worldwide. Over the next decade, the growth of Australia Zoo coincided with Steve’s rise to fame in Australia and globally. As their success grew, Steve and his wife Terri poured their profits into Australia Zoo, major conservation projects and turning large tracts of land in Australia, the US, Vanuatu and Fiji into wildlife refuges. They also founded the non-profit organisation Wildlife Warriors Worldwide. Each of these projects is expected to continue under the guiding hand of Terri and management staff. Queensland Tourism Industry Council Chief Executive Daniel Gschwind said Irwin’s highly effective conservation work often went unnoticed, overshadowed by his public persona.

“He could connect with people on an extremely personal level, no matter what their age or background. I believe everyone who is part of the tourism industry across the nation would feel they are mourning the loss of a friend,” he said. “The groundbreaking conservation work Steve contributed to Australia is his legacy to us all and in this sense he truly is a modern day hero.” At the Australian Tourism Awards on the Gold Coast in February, Steve Irwin was awarded the Services to Inbound Tourism Award for his enormous contribution to Australia’s tourism industry. He is survived by Terri and their children, Bindi and Bob.

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atx: feature

generation

It’s all about them They’re young, confident, technology driven and socially aware. And bombarded with so much information that it’s difficult to cut through the clutter to reach this misunderstood demographic. So who exactly is Generation Y and what appeals to this new generation of traveller? Sheriden Rhodes reports 48

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Reaching today’s Generation Y market can be a challenging exercise. Not only are they bombarded with information at every turn, they’re also cynical and rely heavily on word of mouth. Generation Y, also known as “Millennials”, “Generation Next”, the “Echo Boom”, or the “Digital Generation”, were born (depending on who you talk to) between 1978 and 1994, which means they’ve not yet hit 30. And while often seen as a marketer’s dream, Generation Y is proving even harder to reach than their predecessors, Generation X, simply because they’re at saturation point – creating a real challenge for tourism operators wanting to access this younger market segment. On the plus side, the needs, desires, wants and grievances of this new generation of traveller have never been so transparent with blogs, websites and chat rooms espousing their opinions on everything from bus trips around Australia to the latest gadgetry for their MP3 players. Travel is also proving a high priority for this generation, which is good news for those involved in the tourism game. Destinations which hold strong appeal to Generation Y ex-Australia include Thailand, India and Bali, while Cambodia is popular for those looking for an off-the-beatentrack experience.

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Millennials don’t simply want to follow the path-well travelled, and are looking for something different, which is why travel to Cambodia is becoming more prevalent, says Jen Bird, Communications Manager with Intrepid Travel. While Intrepid markets to a state of mind, rather than a demographic as its products can appeal to anyone from 17 to 70, Bird says a large proportion of Intrepid’s travellers are a younger demographic. “We consider Generation Y to be late teens and late twenties,” Bird said. Generation Y, like many modern travellers these days, are particularly interested in real experiences, rather than a week on the beach, she says. “Today’s younger travellers are looking for fun, they want to meet people and get out there and have an adventure by doing something different.” Intrepid, she says, attracts many Generation Yers undertaking their gap year. “They might be at the beginning or the middle of their gap year and want the security of a group to get their feet on their ground. When they feel comfortable, they go off and do their own thing.” Likewise, she said, some younger travellers are doing a big trip and book Intrepid for certain areas where it is more difficult to travel independently, like China or India. As would be expected, budget travel still appeals to Generation Y, says Bird. “Our Basix trip style does tend to appeal to this younger audience, with 70 percent of travellers aged 20 to 29. “They’re constrained by budget and want their money to stretch as far as possible.” Bird says Intrepid’s inbound product tends to appeal more to an older Generation X audience, as small group travel is an expensive exercise in Australia.

“Today’s younger travellers are looking for fun, they want to meet people and get out there and have an adventure by doing something different.”

and young people actually talk about your product online.”

“There are certainly a number of younger travellers that come with us, and what appeals to them is the experiential style of activity in Australia like cattle station or jungle stays. Things they can’t necessarily do on their own.”

Generation Y expert Peter Sheahan says travel is a rite of passage for this demographic. “When you talk to a baby boomer about their younger years, it was all about ambition, climbing the hierarchy and getting a mortgage. With Generation X it was about doing a job they were interested in, getting a nice car, and putting some money aside.

Bird believes it’s going to become increasingly challenging for companies like Intrepid to reach Generation Y. “We’re fortunate in that our reputation and our product sells itself, particularly given word of mouth is very important to this generation of traveller.” Managing Director of Contiki Holidays, Tammy Marshall, agrees. “It’s a different generation and how we talk to this generation is different to how we have traditionally marketed Contiki.” Marshall says while Generation Y is loosely considered to be those born between 1978 and 1994, it’s also a state of mind. She said typically today’s young traveller is street smart and socially aware. “They also tend to be well-educated, very lifestyle centric and have their wits about them.” But the biggest difference, she says, is when it comes to technology. “There is an enormous community on our website,

Marshall echoes Bird’s sentiments when she says this means companies need to deliver a fantastic product. “Word of mouth is significant due to Generation Y’s ability to communicate in social networking sites, sub-communities as well as Contiki’s own community online.” “If you deliver an exceptional product to this market, then it’s a huge plus. If not, you simply won’t last.”

“For Generation Y it’s about experiences – how many places they’ve travelled to, how many different jobs they’ve had. It’s about the consumption of life’s experiences and travel is a big part of that.” Sheahan says life has been pretty good for this generation, and while there have been some challenging world events, they’re predominantly not fearful. “Things like September 11 didn’t massively impact their desire to travel – they’re still willing to get out there.” He said while it’s typically harder to define what type of travel appeals to Generation Y, experiences where travellers genuinely interact with another culture are popular. “Things like going to Nepal and working in an orphanage have strong appeal. There’s definitely a trend towards giving atx:magazine:yearbook2006

atx: feature “They still make choices regarding travel based on price, but they are now able to travel far more than previous generations.” something back. They want to live and work in a place, not just take photos of the Eiffel Tower.” Sheahan says Generation Y is less constrained financially than previous generations and has more disposable income, given that many still live at home, and often have their parents’ support for purchasing things like air tickets or spending money.

online booking systems and being proactive to reach Generation Y.” He says Generation Y also wants to collaborate in the creation of their own travel experience. But his biggest tip for tourism operators is simply this – “do less more”. “Have fewer destinations but create a more authentic experience when travellers are there. Go to the offbeat places, not where everyone else is going. Generation Y want to do what the locals do. When they come to Sydney, they don’t want to go where the tourists go they want to do what Sydneysiders do.”

“They still make choices regarding travel based on price, but they are now able to travel far more than previous generations.” And, he says, they’re definitely more price savvy, thanks to the internet. Sheahan, who is a Generation Yer himself, says tourism operators therefore need to place a bigger emphasis on their websites and portals. “There needs to be more individual tourism-based operators building better web strategies, improving

Defining characteristics of Generation Y • Technology driven • Trend savvy • Socially aware • High disposable income • Impatient • Attracted by things that are relevant to their world • Looking for stimulation • Want to connect to their environment • Like to be in control

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Great Ocean Road Helicopters AD

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Trading in knowledge Most travel companies’ trade websites are dedicated purely to travel agents, and thereby miss out on opportunities to reach clients such as wholesalers, tour operators and the ever-growing MICE sector. One in particular that is targeting beyond just the agents is Accor. Anders Lindström examines hotel giant Accor’s trade website, accortrade.info.

Surprisingly at first glance there is not that much to differentiate Accor’s consumer website with its trade site. It is not password protected, which means any travel professional can easily access the site. You could even easily be mistaken to be exploring the consumer website, missing only the booking tool.

or marketing/promotions, just simple information and reference guides. It is a reference point for the travel industry, for those who specialise in selling hotel accommodation and specifically for our clients: wholesalers, tour operators, travel agents,MICE [ Meetings, Incentives, Conferences and Events] etc.”

“The [trade] site’s purpose is to provide a central point, purely for information,” explains Katia Giurtalis, Director of ECommerce, Accor Asia Pacific. “It does not have pricing, a booking engine

Giurtalis lists a number of functionalities that are suitable for inbound tour operators (ITOs) for instance, such as detailed information that could be used to assist the operators when recommending and selling

You haven’t experienced the best of Perth without a leisurely trip to its largest recreation and conservation reserve.

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In the charming central village there’s a licensed café, craft shops and working displays of ‘old time’ trades, including printing, bootmaking and traditional wheel wrighting. And of course, there are playgrounds for the children, including a summer splash pool, sports courts, walk trails and bike paths, and much, much more. For more information, simply visit us at www.whitemanpark.com

WHITEMAN PARK R E C R E AT I O N & C O N S E R V AT I O N R E S E R V E

atx: tradinginknowledge “Our consumer website is a marketing avenue, a transactional site and consumer information site,” explains Giurtalis. Accor hotels; search by map facilities; destination information, and a monthly newsletter. It is also complemented by a function to efficiently request images to be used for brochures and other promotional material or downloadable MICE fact sheets. There is also an Accor MICE e-Directory to download. However, when quickly comparing a hotel on Accor’s consumer website with its listing on the trade site, the information to consumers is far more extensive than to trade, which somewhat defeats its purpose. Consumers would be more inclined to get more information themselves and thereby also book directly on the Accor website rather than through one of Accor’s travel clients/partners. “Our consumer website is a marketing avenue, a transactional site and consumer information site,” explains Giurtalis. “It is also a source of revenue or distribution tool for our hotels. ”One thing the trade site explains with far more superiority is

the distinction between all the different Accor brands. Ranging from the luxury Sofitel brand to the more simple Ibis hotels, with another four brands in between (Grand Mercure Hotels, Novotel Hotels and Resorts, Mercure Hotels and Resorts and All Seasons Hotels), the line of difference can easily become blurred. However, a comprehensive comparison table between all the brands would be suitable and an appropriate tool for an even quicker overview. There is also no tool to compare a selected property with another. One important search feature available though is to list only hotels based on criteria features such as family room, recreation centre, meeting facilities, kids club, massage and nightclub, etc. Room for improvements however, would be for greater interaction with trade, and especially travel agents. In comparison, Marriott’s trade website is dedicated almost purely to agents.

It lists comprehensive information on commissions, familiarisations and travel industry rates, features that are not available on the accortrade.info site. It also features the popular Marriott’s Hotel Excellence! Training - a hotel sales and training program for travel agents. At present, a number of the functionalities, such as the commission information, is for the US trade industry, but will be modified and introduced to include Australia next year. According to Giurtalis, Accor has tracking metrics in place to track visitors, but as it is not a consumer/transaction site, these statistics are used more for information only. “It is interesting that after we have a trade show or sales mission, visitation spikes…so it works,” she adds. The website impressively also includes add-on features of non-hotel products. In Sydney, for instance, it also lists information on Magistic Cruises, the Sydney Convention & Exhibition Centre, the Summit Restaurant and Sydney Showboats. The accortrade.info site covers Asia Pacific and will next year be translated into Asian languages.

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What happens on tour... atx: d

atx: would like to thank our contributing photographers including Zahrina Snell, ATEC’s event photographer. To view ATEC event photos, visit www.zahrina.com

If you have photos from when you were “on tour”, atx: would love to publish them. Please email high res images with captions to: editor@atxmag.com.au

There was work as well as play at this year’s

Inbound Up North in Tropical North Queensland.

Recently in London at an industry lunch were;

From left: Costas Voutiras – Travelmood; Todd Parker – Parker Travel Collection; Jerry Bridge – Bridge and Wickers; Michelle Kenna – Hamilton Island; Robbie Orr – Thomas Cook and Todd Parker.

LEADERSHIP AND MANAGEMENT CONFERENCE 2006 From left: Belinda Watson, Heidi Dunn and Andrew Hodges fly the ATEC colours

Scotty Garden was happy to receive his certificate

Mai Tran, Rebecca Rigaldi, Naomi Hotton and Michael Arcenas made the most of the networking function

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ATEC Chairman John King (right) with Greg Dallas ATEC Vic/Tas Branch Chair

Federal Tourism Minister Fran Bailey with Bob Lunnon - winner of the ATEC Most Outstanding Contribution by an Individual award.

It’s just cricket - TNQ crew with UK wholeslaers

Working hard at Oztalk USA in Los Angeles

Michael Curtis - Rydges Resorts and Hotels “training” in TNQ

OzTalk Thailand - SITA Coaches crew

YATEC Event Networking atx:magazine:yearbook2006

atx: spotlight Going Global Australia’s remote North West has its sights set on the international market. Sam Tinson reports on this emerging international destination The more beautiful, isolated and unspoiled the destination, the harder it is for visitors to get to it. It’s one of the great Catch-22s of wilderness tourism, and one that applies all too well to the far-flung deserts, beaches, reefs and gorges of North Western Australia. Despite myriad natural wonders, spectacular wildlife and rich Aboriginal culture, the Kimberley and Coral Coast – with no international airport or city to assist them – have always had to work hard for their overseas custom. All that could be about to change, thanks to a series of long-term strategies by Australia’s North West Tourism, designed to increase international yield in the region. Chief among them is the Gateway Project, an ambitious proposal to bring international flights directly into Broome from Singapore, effectively giving the North West its own international airport. Glen Chidlow, ANWT’s new CEO, is one of the scheme’s biggest fans. “Our existing overseas visitors are predominantly from the UK and Europe, and the option to travel through Singapore will greatly increase the accessibility of the region to this market,” he says. “International tourists would be able to visit us before travelling on to the more populous east coast destinations, or make the North West their last port of call before heading back through the hub of Singapore.” But what impact will these increased visitor numbers have on a region where the lack of tourist crowds is such an important draw card?

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“Our intention is very much to attract a high yield customer, rather than excessive numbers,” explains Chidlow. “We’ve concentrated on pushing eco-friendly, upmarket safari-style accommodation in wilderness locations. This type of infrastructure has a low environmental impact and enables the disbursement of visitors across the region, as well as providing the type of travel experience that many of our international customers seek.” This focus on low-impact tourism is behind another ANWT initiative - the promotion of extended drive trails linking iconic sites, national parks and towns. One such route is the Savannah Way, linking Broome to Cairns, and another is the proposed Warlu Way, which would link Exmouth to Broome via the Pilbara, including Karijini and Millstream National Parks. There should be no shortage of takers - in the year 2004-2005 almost 50 percent of the North West’s overseas visitors used a caravan or camper as accommodation during their stay. “These are the people we are catering to,” says Chidlow. “Drive trails are a great way to promote the features of a large region without the need for intrusive resort developments.” The North West’s designs on the international market are not limited to grand government enterprises. Efforts are taking place at the grassroots level to ensure local indigenous communities have a say and a stake, in the burgeoning overseas market.

Sam Lovell, a Kimberley local and Project Officer at the Office of Aboriginal Economic Development (OAED), is optimistic that the region’s traditional landowners will not lose out. “The North West is a front-runner when it comes to encouraging and promoting Aboriginal-owned businesses,” he says, citing tourist accommodation, guided walks, vehicle tours and artefact shops as examples. “Development of the region is tightly controlled. Whether you’re an individual, a family business or a company, you need the consent of the whole community before you can go ahead with a project.“ Lovell, who established his own tourism business, Kimberley Safari Tours, in the 1980s, points to the improvement in education and business training facilities for tour operators in remote areas. “On-the-spot programs run by groups such as TAFE and CALM have proved popular in remote communities. They provide knowledge where it’s needed, and empower those who might otherwise get left behind. “Local businesses are much more likely to get off the ground, and ultimately the whole community benefits.“ The Gateway Project is expected to begin operating sometime in late 2007. When the world comes knocking, Australia’s North West will be ready.

NORTHERN TERRITORY

SHORT BREAKS

Experience Uluru (Ayers Rock) capturing for its ancient history and the nearby domes of Kata Tjuta (Olgas) dominating the western skyline. Further north the Kakadu National Park will leave you breathless for both its natural and cultural sights and Darwinâ&#x20AC;&#x2122;s mix of cultures and fabulous food will amaze you. From the desert to the tropics, Northern Territoryâ&#x20AC;&#x2122;s magic is inspiring.

Choose from one of our many Northern Territory Short Break Tours, you are sure to find a Short Break Tour to suit any taste. Here is an example: 2 days Camel Farm, Uluru & Kata Tjuta 1 night stay at the Desert Gardens Hotel or the Emu Walk Apartments in Ayers Rock. 3 days Kakadu and Arnhem Land 2 nights stay at Gagudju Crocodile Holiday Inn at Kakadu.

New Luxury Wilderness Lodge for 2007 Exclusive to APT Kings Canyon Wilderness Lodge will feature 10 luxury tented cabins with full en-suite bathrooms and 4 star appointments. The Lodge will also feature a dining and lounge area. A feature campfire provides the ultimate outback setting for dining under the stars most nights. Ask about the comprehensive range of APT Tours that offer the opportunity to stay at this unique new property.

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atx: history

CHARLES HOLMES: PIONEER OF PROMOTION John I. Richardson looks at where we have come from Australia is one of the world’s big spenders on destination marketing and in these days of $180 million advertising campaigns and plenty of controversy to go with them, it is instructive to look back to the beginning – to a time when the only way to visit Australia was by ship and the idea of promoting tourism from overseas was a bizarre concept to all but the very few. That ‘very few’, however, were determined and none more so than Charles Holmes, who was to lay the foundation for what was eventually to become Tourism Australia, with its string of offices around the world, its multiple websites and a budget that Holmes, in his wildest dreams, could never have conceived. His own achievements were enormous. Beginning in the depression year of 1929, he was to oversee the opening of promotional offices in London, San Francisco, Wellington and Bombay before the Second World War put a temporary stop to his efforts. Holmes had broken new ground by opening the first tourism promotional offices of any nation on the West Coast of the United States and on the Asian continent. When it all began Holmes was chairman of what seems to us the oddly named

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Betterment and Publicity Board of the Victorian Railways. Basil Atkinson, who was to become his chosen successor at the helm of the Australian National Travel Association (ANTA) – and whose recollections are the source of information for this article – has described him as: “Tall and distinguished and a Military Cross winner from World War One’ …one of the few who foresaw the role tourism could play in developing our future … he travelled Australia by train, tram, car and even camel in the late 1920s preaching the potential and virtues of tourism.” He laid stress on the economic argument. Tourism was Canada’s third largest source of income. And promotion worked. South African tourism had increased four-fold since it had begun telling the world of its attractions. As for Australia, if one person in 2000 in the English-speaking world could be persuaded to visit the country it would give us additional income of 21 million pounds in five years. His persuasion worked, particularly after he had addressed the 1928 annual conference of the Associated Chambers of Commerce in Australia in Hobart. ANTA was formed the next year and no time was lost in opening the first office in London. During the Second World War he held several important posts, including that of Director-General of Information (succeeding Sir Keith Murdoch). He also managed to continue publication of the travel-geographical magazine Walkabout which he had begun in 1934. At war’s end he returned to ANTA and found the going harder than ever – ANTA was so short of funds that he had to operate from

a borrowed room on the second floor of the Flinders Street railway station in Melbourne. It was not until 1956 that the commonwealth government provided sufficient funds for overseas promotion to be resumed. But while the government had been lukewarm about tourism in the early years after the war, by 1961 it became almost enthusiastic when it realised it might help solve a balance of crisis. ANTA agreed, though pointing it out would take some time – tourism could not bring in foreign currency overnight. Nevertheless, that period marked the beginning of the commonwealth’s serious engagement in tourism, resulting in the formation of the Australian Tourist Commission as a statutory authority in 1967. As we know, it was succeeded by Tourism Australia in 2004. Charles Holmes had left the scene long before. Basil Atkinson, then a young West Australian journalist, had been chosen from 234 applicants as ANTA’s first post-war overseas manager and left at the end of 1956 to take up his post in San Francisco. A few months later he was back in Melbourne. Holmes had decided to retire and the board had selected Atkinson to replace him as general manager. It was he – and an outstanding board – that oversaw the conversion of ANTA’s overseas operations into the Australian Tourist Commission. Atkinson later wrote: “Our story has not been all plain sailing but it has been one of constant growth and capable, professional people.’” In the beginning one man’s name shines above all others: Charles Holmes.

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atx: guestcolumn

The Joy of Travel By Robbie Bastion

In 1972 a bloke by the name of Alex Comfort wrote a book which was to become a worldwide bestseller – The Joy of Sex. There is no doubt that sex has brought pleasure to millions over the centuries but then again so has the past-time of travel. So in the footsteps of this brave pioneer I, too, bare my soul and jot down some thoughts in my very own – The Joy of Travel. 1. Different positions – I believe some things, such as sex and travel, should not be hurried. One should start with the basics and build on your repertoire from there. So too, I started as a junior travel consultant selling day tours at the NSW Travel Centre. From there I have discovered the joy and satisfaction of new positions – senior travel consultant, supervisor, manager and now director of sales. To paraphrase Mr Comfort, I have found the higher up you go, the more pleasurable it is. 2. The Q-Spot – whilst the Q-Spot has been around since the days of the Coloseum, it has made a remarkable comeback since the more security-conscious days of the new millennium. Just recently, I spent several hours in the Q-Spot checking in for a trans-Atlantic flight and several more at US Customs and Immigration. The Q-Spot can also be found at London tube stations, Chicago nightclubs and the ever popular men’s room at the MCG during the Boxing Day Test. It’s true – the Q-Spot produces intense emotional feelings, hot flushes and the urge to yell “Oh God” out loud! 3. Foreplay – golf is as important to the travel industry as ticket-less travel and certainly much more enjoyable. Many a commission deal, merger or takeover has occurred on

the gentle fairways of some of Australia’s most picturesque courses. The truly mystical thing about industry golf is that no one ever seems to pay – either for the game or the endless beverages consumed therein. 4. Kinky tricks – the travel industry provides us with opportunities to get truly creative and engage in activities that bring more pleasure than normal. For example – who can forget the euphoria of purchasing a discount economy round-the-world airfare and then negotiating, begging and promising various colleagues to end up travelling business class on upgrades sitting next to some poor sap who has paid full freight. Nirvana! 5. Multiple partners – this particular practice has gathered momentum, especially in the last two years. A pleasant dinner with the product manager, some fine wine and stimulating conversation and before you know, your product is not only brochured in said product manager’s program, but also in four other brochures which had previously rebuffed you until his company bought them all during the year. Ah, multiple partners for the price of one.

Yes, The Joy of Travel is still alive and well! australias southwest.com

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Western A ustralia Th e R e a l Th i n g

atx: tourismhero

Q&A The best thing about travel is….that you are able to actually experience other cultures and meet people from different cultures, even in Australia. The Australian travel industry needs…. an open skies policy. Let’s become the world dumping ground for tourists instead of trying to control it all. The tour operators’ industry is….at the beginning of a new Golden Age. If I didn’t work for APT…. I might be a funeral director. When my father was considering his business, he identified two growth areas, bus transport and funerals, so if he’d gone the other way and I’d still gone into the family business, that’s what I might be doing now.

GEOFF MCGEARY AUSTRALIAN PACIFIC TOURING GROUP Lee Mylne talks with an industry founder

Geoff McGeary has come a long way since the day, as a 19-yearold, he successfully applied for an underage bus driving licence in order to take over the family business. 62

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I always thought…. the travel industry attracted people who often lacked substance and that the industry was inclined to float on paper, and as a result was not seen as a “real” industry. But that is now changing as the investment and venture capital markets are starting to treat the industry seriously. I’m most proud of….. the achievements of Australian tourism on the global scene. Australia’s place in tourism far outweighs its size, in population terms. My dream today is…. to play a part in the success of individuals in our business by coaching, mentoring, encouraging and developing a team to stretch and grow and achieve beyond their dreams. It gives me a lot of personal satisfaction. I’m most impressed by…. the bright young folk coming into the industry today. When I retire…. I’ll be dead. I try to balance work and play but I have difficulty drawing a line between the two. ATEC to me is….. probably the most significant association that we can relate to. My favourite place is…… the Australian outback, particularly the Kimberley, which has great appeal to me. I also enjoy waterbased locations and activities – boating and cruising – but am just as happy sitting around a campfire in the Simpson Desert.

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With offices in London, Los Angeles, Frankfurt and Auckland, APT now carries more than 30,000 people each year on extended coach tours, another 200,000 on day tours and has a growing group touring operation of which more than 70 percent of customers are international. His father Bill had five buses doing school and charter runs in Melbourne, but had been advised to sell because of ill-health. Geoff had other ideas, but the company could only afford to pay him if he became a driver. “For two years, I only got paid for the hours I drove,” he recalls. “I was under a lot of pressure to build the business up.” McGeary’s determination and vision has resulted in Australian Pacific Touring Group preparing to celebrate its 80th anniversary in 2007, with his children Robert and Louise now also involved. In the early days, Geoff moved the focus towards extended tour work, undertaking the company’s first interstate trips to Sydney for the ‘60s musical Hair, initially deemed too risqué for Melbourne audiences. “I consider myself an opportunist and think I have been all my life,” he says. “I’m not bad at spotting openings.”

combining cruise, rail and coach tours.It has also invested in three European river ships and a 74-passsenger rail carriage on Canada’s Rocky Mountaineer. McGeary believes in “putting back” into the industry which has been good to him, and the family has established the APT Conservation and Charitable Foundation as part of its commitment to responsible tourism. APT has also “put our money where our mouth is” with a $5 million protection plan for its customers. “Organisations worth their salt should be prepared to put aside resources for the protection of consumers - people who have shelled out their life savings for dreams, and have put their faith and trust in us,” says McGeary. “In the service industry, where you are selling services and products which are dreams, credibility is important.”

That nose for business was to be the making of the semidyslexic young man who “everyone thought was a dope”. Today, APT is a global multi-brand business which includes some of Australia’s best known names and has annual revenue exceeding $250 million.

McGeary believes in “putting back” into the industry which has been good to him, and the family has established the APT Conservation and Charitable Foundation as part of its commitment to responsible tourism. In 1967, Geoff and another coach operator, the late Mayer Page, formed a partnership that was to last for 27 years. When they parted in 1993 Page took AAT Kings and McGeary took APT. With offices in London, Los Angeles, Frankfurt and Auckland, APT now carries more than 30,000 people each year on extended coach tours, another 200,000 on day tours and has a growing group touring operation of which more than 70 percent of customers are international.

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“We are now very much an offshore operation, both from an inbound and outbound point of view,” says McGeary. In recent years, the company has expanded into new market segments including youth and adventure brands, as well as atx:magazine:yearbook2006

atx: tourismhero

The accidental tourist Anders Lindström speaks with this humble North Queenslander

Max Shepherd is not your typical tourist operator figurehead by any standard. He likes to keep a low profile, and he does not like to be interviewed, exclaiming: “There are a lot more interesting people than me, I can give you a list!” But despite a low profile, Shepherd has managed to build a solid and fruitful career, to become one of the most prominent players in the Queensland tourism industry. He entered the industry at the tender age of 14 with one ambition: to get a secure job. He happened to stumble upon one as office junior in the Queensland Government Tourist Bureau. He even remembers his starting date: 1 March, 1967. After over 39 years in the industry, Shepherd has worked across what are probably Queensland’s three major tourism companies: Tourism Queensland (for 20 years); Quicksilver Connections

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(for 17 years); and the past two years as the General Manager of Skyrail Rainforest Cableway and Director of Skyrail. He admits his move to Quicksilver after two decades with TQ only came down to one thing: he was moving to Cairns. “It was very much a personal move, as we wanted our children to be brought up in an outdoor and relaxed environment,” he says. Even though Shepherd remains reserved throughout the interview, his passion and enthusiasm for Queensland is evident. He is currently a board member of Tourism Queensland, and a past board member of Tourism Tropical Queensland, as well as ATEC. But nevertheless, when promoting his state overseas, he would not separate it from the rest of Australia. “I wouldn’t say it’s about competing with other states. Queensland is very much part of the Australian product and in Queensland we’ve got the outdoor, relaxation, the tropical part. “I’ve seen Queensland [as a tourist destination] change a number of times. As the market changes, the destination

The best thing about my job is… seeing so many people of many nationalities leave their Skyrail experience with a higher appreciation of the natural environment and as new ambassadors for environmental protection.

atx: maxshepherd

Q&A

the way places, particularly in Australia.

The one thing I regret is… that I did not make the opportunity to progress to create and develop a business of my own.

The best thing about Queensland… is the relaxing outdoor lifestyle and permanent holiday atmosphere. The best thing about travel… is learning from other people and cultures. If I had not worked in tourism I… would have missed out on meeting and working beside many great people in a friendly, vibrant and fun industry.

The one most important thing I have learnt is… that life and business is about people and relationships.

I always say… taking the time now to get the detail right saves twice the time and cost correcting the embarrassment later.

My years at Tourism Queensland… left me with an understanding of the importance of the need for the industry, investors and government to work as a team to achieve sustainable growth and economic success. When I retire… I do not see myself making a complete break from the industry, but certainly becoming the tourist seeking out more of the out of STAY IN MELBOURNE

The Australian travel industry needs to… recognise that all levels of the product chain must be successful if we are to provide the experiences our international visitors are seeking.

ATEC must… maintain an ear to its members and a collective voice for them. As an organisation it needs to recognise the aspirations and goals of the industry collectively and help pave the way to achieving those objectives. ATEC must remain the substance that holds the industry together and sets the standards by which the industry operates.

“If I had not worked in tourism I would have missed out on meeting and working beside many great people in a friendly, vibrant and fun industry” changes. Early on it was very much about the scenic beauty and Queensland was a frontier type of destination. “Then the airlines came in and holiday packages within a certain price range and we saw the leisure market become more important. “We saw a big boom in the ‘80s, and we capitalised on the international market, but at the same time the backpacker and adventure markets.” On the note of his own favourite personal Queensland experience, he pauses. “It’s a hard question, but as a tourist, the most exciting and rewarding experience was rafting on the North Johnson River. It was an untouched and unspoilt environment, and brought together a group who travelled together and came to depend on each other.” Another highlight was his game of golf with former US President Bill Clinton. “That was fun, very relaxed. We spoke about the region and what a special place it is. I got the feeling he appreciated [Queensland] for being somewhere he could relax, be open and be himself.”

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STAY YOUR OWN WAY atx:magazine:yearbook2006

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atx:magazine:yearbook2006

atx: usefulstuff

Online Money By Moira Scerri An inbound tour operator rings ... “What can I do, the bank has just taken $15,000 out of my account?” What is a charge back? A charge back is where a client who has purchased a product or service may dispute the charge with the bank. This dispute may occur up to six months after the charge has been processed.

What does this mean to you? If you take a booking and charge a client’s credit card there is an element of risk that you will receive a charge back. Charge backs may be categorised into three groups: • Legitimate charge back – the customer was well within their legal rights to dispute the charges. • Fraudulent transactions – the customer used the card when they were not the cardholder or had no authorisation to use the card. • Friendly fraud – this is where the client’s credit card has been charged but they are disputing that the quality of the goods or services are inferior to their expectations. Some believe that having a client fax a signed authorisation will provide them with protection or immunity from charge

atx:magazine:yearbook2006

backs. This is incorrect as a signed form received by fax will not provide any legal protection against charge backs.

How can I protect myself against charge backs? Merchants are able to apply to their bank for a 3D Secure Merchant account. Transactions processed via a 3D Secure take a little longer as it goes through the following process: • Registration - The registration process determines if a customer has registered to participate in 3D Secure. For those not registered “a request to register” screen will appear. For those who are registered the authentication process begins. • Authentication - The authentication process requires the customer to enter a personal identification number (PIN) as they would do when accessing an automatic teller machine (ATM). • Authorisation - The authorisation process checks to ensure the client has sufficient funds available on their credit card for the amount being requested. An approval or decline code is then passed

back to the merchant. The 3D Secure process works very well for business-to-consumer (B2C) transactions and is available for bank issued Mastercard and Visa card cardholders. The merchant risk of fraudulent transactions moves from the merchant to the acquiring bank. This immunity from charge back is a big step in minimising the risks of accepting credit card transactions online. However, 3D Secure does not work well in a business-to-business (B2B) environment, where an agent is passing through a client’s credit card to the merchant for processing. Credit card fraud insurance is required in these circumstances. Moira Scerri Business Development Manager - Moneydirect

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