28 Dec, 2009
Last Minute Surge Props Up Thai Tourism in 2009
Thanks to a surge in tourism arrivals in the last quarter of 2009, the Thai tourism industry is projecting to close this year with a total of 14 million arrivals, down just 4% over 2008.
In 2010, the forecast is for a 7-10 percent increase to 15 – 15.5 million visitors, “if no serious incidents of political or other threats arise,” a caveat that has now become a fixed part of the tourism forecasters’ lexicon.
According to a Tourism Authority of Thailand report released last week, the first half of 2008 saw a 16% decline in arrivals, thanks to the impact of the global financial crisis, fears of a bird flu pandemic and the lingering fallout from the 10-day closure of Suvarnabhumi airport in late 2008.
Arrivals from the North East Asia market were worst hit (-30%), followed by American and Oceania markets. The ASEAN and European markets were not too badly hit and the South Asia and Middle East markets maintained a growth rate.
Since August 2009, the report says, the situation has been improving steadily.
The number of visitor arrivals declined by only 5% in August and then shot up 10% in September, maintaining steady increases in the October-December final quarter. Visitor arrivals at Suvarnabhumi International Airport during November and up to mid-December were up 40%. Charter flights to the popular destinations such as Phuket and Samui are also up from European and Asian markets.
The TAT report attributed the rapid turnaround to five factors:
1. Economic conditions around the world are improving faster than anticipated, and consumer confidence is returning.
2. The political situation in Thailand is more stable. Although the domestic political situation remains fluid, there have been no “adverse events” dominating TV screens worldwide.
3. Quick action taken by Thai and global authorities to curb spread of the H1N1 virus.
4. Government measures to encourage travel such as visa fees exemption, reducing landing fees and aircraft parking charges, which have given incentives to operators to continue promoting Thailand.
5. TAT marketing efforts from July onwards to help restore and rebuild confidence in Thailand. These included roadshows, stronger promotional partnerships with the private sector and marketing of special offers and value-for-money deals.
To this list could be added the stepped up efforts by Thai Airways International, the numerous scheduled and low-cost airlines serving Thailand as well as the aggressive pricing promotions of the private sector.
The TAT says that the three main determinants of visitor arrivals in 2010 will be the same as those influenced arrivals in 2009 – global events such as financial or geopolitical crises, the economic situation in each source-market country, and the political situation in Thailand itself.
Assuming no further instability, the TAT has charted the following strategies:
<> Expanding market penetration to increase market share: Largely due to the stability of the flight situation, the markets targetted for this strategy are ASEAN, South Asia, France, UK, Netherlands, Iran, Kuwait and Jordan. The customer segments will be primarily leisure tourists, especially from Asia where the emphasis will be placed on short break holidays, value for money and shopping. Niche markets to be pursued will be the health and wellness segment from the Middle East and golfers from Asia.
<> Maintain existing market share: The main markets in this group are Oceania, Scandinavia, Germany, Russia and Vietnam. The strategy will focus on expanding the quality-visitor segment, especially via stepped up joint marketing with partners outside the industry such as financial institutions. Travel will also be stimulated during the low-season.
<> Recover lost market share: The targets in this group include North East Asia, America, Singapore and UAE where loss of market share has been “very high” due to the loss of confidence in the safety of Thailand and severe economic contraction in those source-markets. However, with the economic situation looking better, and flights returning to normal, marketing campaigns will be stepped up. For the American market specifically, efforts will be made to take advantage of the networking opportunities amongst the large number of ethnic Thais living there, greater use of online marketing and expansion of roadshows into new parts of the United States.
One lesson learned from the downturn this year has been to maintain a strong emphasis on domestic tourism which was affected more by the economic situation than the political. Bird flu fears only affected domestic travel to Phuket.
However, the same signs of recovery are also apparent in domestic tourism, starting from the third quarter of 2009 and gaining steam in the last quarter.
The TAT says that clearly apparent signs of returning consumer confidence were further underscored by private sector promotions, pricing strategies of low-cost airlines, opening of new routes such as Udon Thani – Phuket, marketing of domestic Thai festivals and even the marketing efforts of the state railways.
Measures to encourage domestic travel by the government sector such as encouraging meetings to be held within Thailand rather than abroad, mounting more domestic educational trips and expanding the duration of the official holidays have also helped.
In 2009, domestic travel is estimated at 87 million trips, generating tourism income 407,600 million baht. In 2010, this is projected to rise to 90 million trips, and 430,000 million baht (+5.5%).
Loading ...
Liked this article? Share it!