24 Nov

Destination Asia-Pacific – The 21st Century’s Tourism Hub

Travel sector looks upbeat for Asia-Pacific region?

According to a study conducted in 2013, the year was good for international tourism and strongest for destinations in the Asia Pacific region – Asia saw six per cent growth. Moreover, the number of international tourists increased by 14 million to reach 248 million. South-East Asia (as a sub-region of the Asia-Pacific) registered a 10 per cent increase. China emerged with a record number of international tourist arrivals in 2013, at 55.69 million.Asia’s tourism industry employs 65 million people and supports one in 12 jobs – exceeding industries such as financial services.

Needless to say, this growth also led to the generation of 1 million new jobs and accounted for USD2 trillion in contributions to GDP, equivalent to roughly nine per cent of the region’s gross domestic product (GDP). This signifies that at present, this sector employs approximately 65 million people and supports one in 12 jobs – exceeding industries such as financial services.

What tourism brings to the table

With more inbound tourists exploring different cities in the Asia-Pacific region as holiday destinations, the benefits abound.

Economic growth

The contribution of the travel and tourism sector to this region’s GDP is expected to grow by 5.4 per cent per annum by 2024. More employment opportunities will also emerge in sectors like hospitality, airlines, transportation services and restaurants, to name a few. By 2014, travel and tourism will account for 79 million jobs.

Social benefits

As the tourism industry matures, social media platforms are making headway. Most of these online platforms, including online forums and travel blogs, are being increasingly used by companies to disseminate information to larger audience. Needless to say, social media is leading to greater awareness of travel among Asians. This has been one of the factors driving the upsurge in budget air travel within Southeast Asia.

Eco-friendliness

Sustainable tourism is emerging as one of the key growth drivers for this sector. Members of the Asia Pacific Economic Cooperation (APEC) group are making joint efforts in the direction of a sustainable future in tourism. APEC’s Tourism Working Group is an initiative to help promote growth in travel and tourism in the region.

Where are the opportunities?

As the Asia-Pacific region becomes an increasingly popular holiday destination, it is gradually emerging as a leader on the global tourism stage.

How will this evolution take place?

Emergence of new traveler segments

A clear shift is underway in the preferences of travelers wherein a customized approach would best cater to their travelling demands. This has given rise to an array of categories for travelers under the female business traveler, small business traveler, visiting friends and family traveler as well as the senior traveler, not to mention the lesbian and gay or LGBT traveler. This growing consciousness of segmented demand will create opportunities for service providers to produce more targeted offerings.

Technological advancement in the region

Online transactions and mobile devices are emerging as key mediums for travel bookings. In countries such as Thailand and Indonesia, the standard fixed internet phase has evolved to mobile device-centric internet usage. Thus, it has become crucial for agents and travel service providers to support mobile solutions or become obsolete.

Moreover, social media is now emerging as a powerful medium of information and decision influencing. 61% of Indonesians mention that they use social media during travel as a means of seeking advice from friends and contacts.

Cruise control

Consumers aged 18-30 are showing strong interest in cruise holidays.

Many travellers have expressed a keen interest in cruise holidays – with the strongest interest cited by the 18-30 age group. This represents a market opportunity for travel agents. But infrastructure is holding back the cruise industry. Many terminals in the region lack the capacity to accommodate larger vessels.

Growth of budget airlines

The global middle-class is expanding rapidly and is expected to reach, 2.1 billion by 2030. Most of the increase is coming from Indonesia, India and China. According to research in 2013, 47% of leisure travelers have taken at least one international flight with a budget airline in the past 12 months.

Challenges ahead

The Asia-Pacific’s travel industry seems to present many business opportunities. Can growth be sustained?

Easing travel access within Asia-Pacific countries

As Asian governments focus on economic integration through trade and investment liberalization, travel between nations will pick up. A strong indicator of liberalization is the increase in bilateral free trade agreements (FTA). With just 53 in 2000, there are now 250 FTAs in various stages of development as of September 2012. Further liberalization is on the cards. Asian governments are bringing down trade barriers via the AEC, RCEP and TPP multi-lateral agreements. One barriers that trade agreements could help address is reducing visa restrictions. This is a huge impediment to the industry, particularly in terms of capturing demand from China and India, as Chinese and Indian travelers tend to require visas for most destinations in this region.

Lack of infrastructure

Improvement in infrastructure is required, especially for the cruise industry. Although home port cruise terminals are being established, the region lacks terminals which can accommodate large and more modern vessels. Moreover, to cater to the potential of outbound tourism from China and India, enhanced airline capacity, improved airport infrastructure and less stringent visa policies need to be addressed.

Enhancing customer experience

Embracing technology to reach out to a target segment and improve the online customer experience has become a crucial competitive success factor. Service providers need to understand that web presence is absolutely critical because travelers often use the internet to make travel bookings. They also read recommendations on social media (often on mobile devices) before choosing a holiday destination. Service providers face pressure to enhance their ratings on social media platforms and online forums as travelers increasingly seek validation from online communities rather than advice from traditional sources.

Human capital crunch

Although there has been a boom in the travel sector, investments in human capital seem to lag behind those in infrastructure such as hotels and airports. According to a report in 2014, an expected shortage of eight million jobs is foreseen in the next 15-20 years.

Upcoming trends in travel

Catering to various types of travelers is big on the agenda of travel service providers as a one-stop approach is no longer practical. Some of the upcoming trends include:

Focus on millennials

The growing impact of millennials is undeniable in this region. Most of them fall in the age-group of 18 – 30 years and are much more ethnically diverse compared to other generations. They are young and have the enthusiasm to explore the world. Some of the key characteristics of the millennials are a preference for urban over resort destinations, likelihood to travel in pursuit of favourite hobbies and roaming with friends from the same age group in an organized fashion.

Senior citizens

Contrary to popular belief, senior citizens are no less keen on travelling. They are not just enthusiastic but very demanding as well. Customer service is a crucial component of their travelling experience.

Taste for luxury

As the number of millionaires continue to grow, so do the number of affluent U.S. households – with an increase from 10.5 million in 2012 to 20.5 million by 2020. This has fuelled the rise of luxury holidays. This particular sector will be dominated by the U.S., Japan and Europe, but significant demand will come from China, India and the Middle-East in future.

On the other hand, luxury travellers are active in writing hotel reviews, representing 52 per cent of all hotel reviews globally between 2012 and 2014 – adding another target segment of interest.

Moving forward

The Asia Pacific region’s travel industry is growing at a fast pace, carrying economic, social and environmental benefits in its wake. Ample opportunities have emerged for investors with the rise of new travel segments, technological advancements and the as yet under-served cruise industry picking up, alongside the phenomenal growth of budget airlines, which have opened up Asian travel destinations to budget travelers.

At the same time, challenges remain. Infrastructure is under-developed and too many travel service providers are not differentiating their offerings enough by segment. Millennials, seniors and luxury travellers, for example, have very different needs and wants when travelling. And most industry players have not yet fully capitalized on the incredible rise in mobile internet usage in the region.

Going forward, the tourism industry in Asia is likely to move into a maturation stage, when more differentiated and segmented offerings start to appear, both online and off-line. We can expect different sections of major tourist cities to increasingly focus on different tourist segments. We can also expect that national tourism promotion boards will increasingly try to position their countries to cater to a wide range of inbound as well as domestic tourist segments.

And one final word: travel clubs and travel agents should not be written off yet. The personal touch cannot be completely replaced by a website.


5 Nov

The 7 Top Steps To Make Nigeria A World Tourism Giant

Africa’s most populous nation, Nigeria, is destined to become the third most populous country on earth by 2050, trailing only China and India. Nigerians are ranked by some surveys, including the World Happiness Report, as one of the happiest people in the world. In fact, a study of more than 65 countries published in the UK’s New Scientist magazine in 2013 suggests that the happiest people in the world live in Nigeria. Boisterous, driven, and proud, Nigeria’s over 350 ethnic groups speaking over 1,500 languages and dialects are the most hospitable on earth.

With 853 kilometers of coastline, some of the world’s most stunning sandy beaches, breathtaking forests, unsurpassed wildlife and mountains, magnificent savannas and cuisines made in heaven, Nigeria has it all. A tourist delight par excellence, Nigerian women are not just some of the world’s most elegant, they rank amongst the planet’s most sexy, curvaceous and intelligent. Nigeria’s biodiversity, dance, music including high-life, Juju, Fuji, and Calypso, to mention a few, will make other nations green in envy.

To put in perspective Nigeria’s geographic expanse, Nigeria is twice the size of California, and bigger than Spain, Portugal, Belgium, Netherlands, and Ireland put together. Nigeria’s ethnic diversity is unrivaled and its physical geography has some of the world’s most breathtaking sceneries. According to some estimates, one in every six Africans is a Nigerian. Amongst UNESCO’s World Heritage Sites are Nigeria’s Sukur Cultural Landscape in Adamawa State and Osun-Osogbo Sacred Grove in Osun State, while nine others, including Oban Hills in Cross River State, Oke-Idanre Hills in Ondo State, Ogbunike Caves in Anambra State, Alok Ikom Monoliths in Cross River State, the Ancient Kano City Walls in Kano State, Gashaka-Gumpti National Park in Taraba State, Arochukwu Long Juju Slave Route in Abia State, Surame Cultural Landscape in Sokoto State, Obio Ubium Grove & Shrine in Nsit Ubium, are all on the tentative list. Indeed Nigeria’s tourism endowments rank amongst the world’s most coveted. But Nigeria is hardly noticed on the world’s tourism radar.

According to rankings by Buzzfeed.Com, Africa’s most beautiful countries for tourism are South Africa, Namibia, Tanzania, Kenya and Uganda. In North America, it’s US and Canada, and in Europe the top ranked nations are Italy, Switzerland and Norway, while in South and Latin America, Argentina, Columbia, Chile and Brazil occupy the top spots. In Asia top to breast the tape are mighty China, India, Philippines and Nepal, while for the Australasian region, New Zealand and Australia are the top dogs. The logical question that springs to mind is, why is the giant of Africa with all its natural wonders get kicked in the butt by Namibia, ranked second as Africa’s most desirable tourist destination?

With oil revenue, which accounts for over 80% of Nigeria’s earnings in steep decline, rapidly depleting foreign reserves, and burgeoning external debt, Nigeria needs to urgently diversify away from oil, and tourism is absolutely Nigeria’s shortest cut to stupendous wealth. The global hotels and tourism industry generates more revenue than telecoms, and oil and gas industries combined. Add other associated services such as independent restaurants and eateries, leisure boats and cruises, casino, air services, and fast foods, hospitality has no rival in terms of income and employment generation. According to UNWTO (UN World Tourism Organization), international tourist arrivals in 2014 was 1.135 billion, and generated US$1.5 trillion in export earnings, with forecast growth in 2015 estimated at between 3% and 4%. Europe, the fastest tourism growing region, has already surpassed UNWTO forecast with growth hitting 4.7% in the third quarter of 2015.

The industry accounted for 34% of Brazil’s GDP, 46% of South Africa’s, and 55% of income in OECD countries in 2013. While South Africa received over 9.51 million visitors in 2013, Nigeria received less than 3 million. In all, the industry accounts for less than 2.25% of Nigeria’s GDP. To develop its hospitality industry to a critical mass to become West Africa’s, indeed Africa’s benchmark considering its huge population and tourism potential, Nigeria must fully rethink its hospitality and tourism development strategy, tactics, and goals. Nigeria no doubt has a lot going in its favour but to join the world’s tourism power houses the country must take urgent steps to reorder its priorities, including taking these top seven steps, covered here in brief:

1. Nigeria must develop a tourism mindset

This sounds fuzzy, but to jump-start its international tourism ambition, Nigerians must embrace tourism as a culture. This is easier said than done but it’s the first prerequisite if the boat must leave the shore. Governments at all levels must preach tourism day and night. Schools and universities must include tourism studies as an essential subject in their curriculum. Hotels, motor parks, airports, land borders must all be tourists friendly. If you visit the top tourism countries like South Africa, Kenya, and Uganda for instance, you discover the drivers are all very well tutored about tourism, highlighting historical landmarks as they take you to your destination leaving you panting to go out to soak in more.

2. Promote internal tourism

This is the second prerequisite. Nigerian’s hardly travel within the country preferring to travel abroad. This must change. However, traveling within the country cannot be legislated. Governments all over the country must create incentives to make their states attractive for visitors. Deliberate steps, such as “handshake across the Niger”, “handshake across the Benue”, and similar initiatives must be elevated to the status of catechism. As UNWTO notes in its annual report, the large majority of international travel takes place within traveler’s own regions, with about four out of five worldwide arrivals originating from the same region. Imagine travelling from the creeks and swamps of Degema in Bayelsa State to the sand dunes of Bunza in Kebbi State. Oh what a feeling!

3. Integrate all the tourism attractions

Tourism thrives in a network. Individual tourist spots matter, but value is derived when the entire ecosystem operates in tandem and in unison. Argungu Annual Fishing Festival, Calabar Annual Carnival, Abuja Carnival and all the isolated golden tourism rivulets must all converge to form a mighty ocean watering the length and breadth of the country.

4. Make travelling easy

This sounds trite but if you travel within the country you soon discover how difficult it is to navigate your way to your destination. From Calabar to Sokoto, Lagos to Maiduguri, Port Harcourt to Kaduna, Uyo to Kano, Ibadan to Yola there are no road signs showing you direction where you are headed. In the 1960s and 1970s there were milestones along the length and breadth of the country signaling where you were, whether 100 kilometers to Lokoja, or 20 Miles to Makurdi. Today that is no longer the case. Other than that, our streets are not well numbered, leaving one in a quandary when embarking on a journey. As basic as these things are, they are in gross deficit all over the country. Time the federal, state and local governments embarked on these basic essentials.

That is one part of the equation. In addition, the country needs bullet trains, the type that can wheeze tourist and citizens from Maiduguri to Lagos, or Sokoto to Port Harcourt or Kano to Calabar in three hours traveling at 350km per hour. The trains we use today belong to the museums. With the parlous state of the economy, the public sector may not be able to handle this massive endeavour, hence a boon for private investors.

5. Give us world-class institutions

We need world-class health facilities, the type dotted all over India, UAE and London that make Nigerians elevate medical tourism to pilgrimage. We need world class schools that can compete with Harvard, Cambridge and Wharton. In the 1960s we had such universities, University of Ibadan for example. We need world-class airports. It’s the same thing UAE did to elevate Dubai International Airport to the status of the 4th busiest airport in the world within 10 years. We need research institutes that will be at the cutting edge of material science, exponential technologies and space science. We need world-class agricultural research labs that will turn our desert threatened north to agricultural Mecca like Israel’s Negev desert. Tourists will entrust their all to us when they trust our world-class institutions can adequately take care of them.

6. Dream big dreams

People will visit you if you have something to offer. People salivate to visit wonders such as Petronas Towers in Kuala Lumpur, the CN Tower in Toronto, the Burj Khalifa, and Burj Al Arab all in Dubai, The Shard in London, the Eiffel Tower in Paris, to mention a few. What do we have? The NECOM House has no functioning lifts and no one goes there. It could be a tourist delight if refurbished. Time we built others, more grandiose and ambitious.

7. Give everyone light

Other than culture, cuisines, dance and music, and engineering wonders, tourists wish to feel comfortable. Light or electricity will make everything come together – beautiful cities, more wealth that fuels higher demand that fuels higher productivity that fuels yet higher disposable income and a virtuous cycle of greatness is guaranteed. If we cannot provide electricity then achieving other things will remain severely circumscribed. According to GGI (Good Governance Initiative), an NGO, Nigeria spends about $30.28 billion annually to import electricity generating sets or generators, while MAN (Manufacturers Association of Nigeria), estimates that Nigerians spend about $13.5 billion annually to fuel the generators. This is not the way to go. Give everyone light the cheap way, as Malaysia gives its citizens, to mention just one country.

There you have them, the shopping list required to put Nigeria on the world tourism map as a global contender. We must promote internal tourism by bridging the North-South Divide. We must set new standards of excellence in healthcare delivery, education, super highways, and city boulevards. More than anything else, we must embrace the notion of greatness as a people. These are tall orders but just getting the basics right, like providing electricity round the clock, will catapult us to the top in the world tourism pecking order. Just do these and Nigeria will become a world tourism giant with a few years. It all sounds Utopian but UAE did it so who is afraid of Utopia?