Strategies for Tourism Australia - Case Study Example

Strategic Plan for Tourism Australia Introduction Tourism in Australia is mainly founded on the country’s unique natural features, landscapes, biodiversity, wildlife and culture. The tourism industry is a major driver of Australia’s economy. In 2006-2007 financial year, the tourism industry generated over $38 billion which is 3.7% of the country’s Gross Domestic Product. During this year, the industry employed over 400, 000 individuals, this accounts for 4.7% of the total employment in Australia (ANAO 2008, p. 13). In 2011, the tourism industry generated over $ 94 billion in spending and employed over 500, 000 Australians (Tourism Australia 2010, p. 6).This shows that tourism is a very significant industry for the Australian economy. Nevertheless, in as much as Tourism in Australia is a booming industry, this industry is faced by numerous challenges that impede on its development. Some of the key challenges facing this industry include; fluctuations in the Australian dollar, increase in air fares and fuel prices. Moreover, risks such as Bali bombings in 2001 and SARS outbreak in 2003 and natural disasters such as Tornados, wildfires, floods, earthquakes also threaten the development of the tourism industry. Additionally, the increasing competition in the global tourism market is increasingly threatening the state of the Australian tourism market (SATC 2008, p.10). Based on the awareness of the role that tourism plays in the Australian economy, Tourism Australia was founded in July 2004 so as to promote domestic and international tourism in Australia (ANAO 2008, p. 13).Basically, Tourism Australia is a government agency that is responsible for promoting and marketing tourism in Australia. This agency is responsible for attracting foreign tourists and encouraging tourists within Australia to travel domestically (Tourism Australia, 2012). Tourism Australia is an autonomous statutory authority whose mandate and responsibilities are stipulated under the Commonwealth Authorities and Companies Act 1997 and the Tourism Australia Act 2004. Under the Tourism Act of 2004, the key objectives of Tourism Australia include; to promote sustainable tourism in Australia, to encourage domestic and international tourism and to help the tourism sector to increase its economic benefits (Tourism Australia 2010, p. 6). This paper seeks to present a strategic plan for Tourism Australia. The key aim of this strategic plan is to provide a clear vision and framework that can be utilized by Tourism Australia in order to achieve its objectives as set in the Tourism Australia Act 2004. Foremost, this strategic plan will provide a clear vision of the current state of Tourism Australia particularly in relation to its mission and purpose. In this case, this plan will describe the purpose of the agency, why it was founded and some of its key functions. It will also highlight the mission statement of the agency. Secondly, this strategic plan will examine some of the factors that are bound to influence Tourism Australia’s strategic plan. In this case, this plan will critically analyse the relationship between culture and strategy. Furthermore, this plan will critically analyse the external and internal environment that Tourism Australia operates in. Subsequently, this plan will highlight the strategic directions, methods and evaluation that agency should use in order to realise better outcomes. In addition, this strategic plan will outline the process of strategic implementation particularly in relation to organising and resourcing, managing and monitoring and strategy in action. Mission and Purpose Generally, Tourism Australia derives its key purpose and objectives from the Tourism Australia Act (2004). Based on this Act, some of the key purpose and objectives of the agency include; To influence individuals, groups and families from foreign countries to travel to Australia for leisure and events. To influence people living in Australia to travel within Australia and explore various tourist destinations and features. To enhance the economic benefits brought about by tourism To help develop a sustainable tourism industry in Australia (Tourism Australia, 2012b). As a government agency, Tourism Australia’s key purpose entails attracting both domestic and international tourists by promoting the unique attributes of Australia’ s natural features, landscapes, biodiversity, wildlife and culture. Some of the activities that the agency engages in order to promote Tourism in Australia include; consumer promotions, trade shows, consumer research, public relations, advertising and media programs. The agency also aims at boosting the economic benefits that comes as a result of tourist activities in Australia. The agency does this by enhancing the demand for Australia as a tourist destination by promoting Australia’s reputation and profile as a desirable business and leisure destination. Moreover, Tourism Australia develops and strengthens relationships within the travel distribution system in Australia by educating sellers and distributors to enhance their capabilities and knowledge in promoting the agency’s products. The agency also conducts trade development and research activities on how to maximize on the potential of tourism and how to develop a sustainable tourism industry in Australia (Tourism Australia, 2011). Tourism Australia’s mission and outcome statement is as follows;” Increase demand for Australia as a destination, strengthen the travel distribution system and contribute to the development of a sustainable tourism industry through consumer marketing, trade development and research activities” Tourism Australia (2009, p.6). Tourism Australia’s focus market includes; leisure tourism and business event tourism. The agency focuses on promoting leisure tourism to both international and domestic tourists who are first time experience seekers as well repeat experience seekers. The agency also focuses on promoting business events tourism by promoting Australia as a convenient location for corporate team building activities, association meetings, seminar meetings, workshops and corporate meetings (Tourism Australia, 2012b). In order to realise its mission and purpose, Tourism Australia launched a new strategic approach referred to as “Tourism 2020”. This strategic approach aims at promoting Australia’s tourism expenditure to $140 billion by the end of 2020. Through its research and marketing expertise, Tourism Australia targets key markets such as China where there are high tourism growth opportunities and consumers are willing and able to spend more and travel widely (Tourism Australia, 2010). Grand & Jordan (2012) observe that an effective strategic plan is founded on the mission, purpose and objectives of an organisation. Therefore, this strategic plan will be based on the mission and purpose of Tourism Australia as depicted in the Tourism Australia Act (2004). This strategic plan sets out how Tourism Australia will realise the set mission and purpose and add value to the tourism industry in Australia. Analysis of culture and strategy Due to the increasingly competitive nature of the global tourism industry, the competitiveness and success of Australia’s tourism industry significantly hinges on strategy that enforces, builds and maintains Australia’s reputation for its unique cultural experiences. In most cases, nature and culture motivates experience seekers and spirited travelers to venture into a particular tourist destination. Therefore, the strategies employed to promote tourism in Australia must take into account the cultural aspect. As an agency established to promote tourism in Australia, the management of Tourism Australia must innovatively, creatively and collaboratively work with other stakeholders to develop appealing cultural experiences and attractions that will attract both domestic and international tourists who visit Australia for either leisure or business purposes. The strategies employed by Tourism Australia and other stakeholders must ensure that tourist get appealing cultural experiences be it in accommodation areas, eating places or conference venues(NT Government 2007, p.20). In order to provide appealing cultural experiences to international and domestic tourists, a true understanding of Australia’s culture and heritage is essential. Generally, Australia is endowed with rich and abundant cultural assets that can effectively attract and appeal to tourists in both local and international spheres. Additionally, Australia has a rich heritage and history that compliments the country’s key tourism features. For instance, Australia’s multi-cultural origins and involvement in World War II are some of the prominent historical and cultural assets. Moreover, Australian festivals provide an opportunity for both foreign and domestic tourists to experience the richness, diversity and depth of Australia’s culture (NT Government 2007, p.20). Nevertheless, due to the increasingly competitive nature of the global tourism industry which has seen the emergence of new tourist destinations, the compelling force that will promote tourism in Australia is the strategies used by Tourism Australia and other stakeholders to promote Australia as a rich cultural hub that offers tourists new and thrilling experiences. Tourism Australia should maximize on Australia’s key strengths such as nature and culture to foster sustainable tourist experiences (NT Government 2007, p. 19-20). Moreover, the compelling difference between Australia and other tourist destination will be established through the strategies used to design and deliver experiences that reflect Australia’s culture and heritage. For example, strategies such as establishing or enhancing cultural attraction sites or promoting information exchange and interactivity may enable tourists to effectively immerse themselves, learn and experience the Australian culture. Furthermore, by developing the capabilities and skills of the workforce in the tourism industry such that they are able to provide high quality service standards will enable tourists to get a taste of Australia’s distinctive personality (NT Government 2007, p. 19-20). Authentic indigenous culture is an appealing force for a considerable number of domestic and international tourists. Recent research studies show that a significant number of tourists who visit Australia often want to experience the indigenous culture by learning about their belief system, their interactions with nature and observing their paintings and art. Most tourists look for easy, affordable, accessible, authentic and engaging experiences with the indigenous culture. Therefore, there is need for Tourism Australia to initiate establishments or structures that can provide tourists with avenues to fully experience the indigenous culture. There is also need to establish information centers within and outside Australia that will provide tourists with information regarding indigenous history, culture, customs and practices prior to their visit to various tourist destinations (NT Government 2007, p. 19-20). Given that a substantial amount of natural and cultural assets are found in Indigenous owned land, Tourism Australia and other stakeholders should work towards building and promoting sustainable social and economic independence for people from indigenous cultures through business ownership, training, education and provision of job opportunities. This will in turn facilitate the development of indigenous tourism and promote culturally appropriate tourism. Engaging in indigenous cultural tourism is a complex endeavor that calls for in-depth cultural awareness, careful planning, consultation, continuous education and sensitive management. In order to realise better outcomes, Tourism Australia needs to work in partnership with relevant stakeholders and collaboratively with indigenous organisations to facilitate and develop the capacity of Indigenous people to capitalise on their culture as feature of tourist attraction in Australia (NT Government 2007, p. 19-20) Analysis of external and internal environment International Tourism External Analysis The global economy is still undergoing recovery after the deepest recession experienced since the 1930s. Recovery in Australia’s key international tourism source markets- USA, Japan and UK- still remains fragile lagging behind that of emerging economies in Asia. For example, while New Zealand- Australia’s highest volume source market-is forecast to experience steady growth between 2011 and 2013 at 1.1% growth in 2011, 3.8% growth in 2012 and 2.6% growth in 2013, growth in 2011 alone was estimated at 6.4% for industrialized Asian economies such as Singapore, Korea and Hong Kong and emerging markets in Asia such as Malaysia, Indonesia and Vietnam. Recovery in key markets such as New Zealand and the USA has been affected by low consumer confidence and reduced household incomes due to factors such as high public debt and unemployment rates and the recent earthquake in Christchurch which dented consumer confidence in New Zealand. On the other hand, investment has propelled economic growth and boosted consumer confidence in key Asian source markets for Australia. Therefore, Asian source markets will be the key to inbound tourism demand with inbound arrivals expected to increase from 38% to 42% between 2011 and 2020 (Tourism Australia 2010, p. 10-12). The rising value of the Australian dollar relative to other currencies is also expected to negatively affect demand for travel to Australia by making it less competitive as a destination. Other factors that are expected to affect international demand for Australian tourism includes the climate change debate where calls to reduce the carbon footprint of long haul travel may affect demand in source markets such as Europe and the USA. This is expected to challenge the Australian market to come up with more sustainable tourist products and experiences (Tourism Australia 2010, p. 10-12). Internal Analysis Australian tourist products-attractions, facilities and experiences- and services are losing ground relative to other leisure choices and destinations. In addition, Australians themselves perceive domestic tourist attractions as providing less value than overseas holidays, a trend compounded by the strong Australian dollar which makes overseas alternatives more attractive. Australian tourism products and services are also facing increased competition from off shore destinations (SATC 2008, p. 7-12; Tourism Australia 2010, p. 10-12). Domestic Tourism External Analysis Currently, there are several factors that have an impact on domestic holiday travel trends. Actual and intended overseas travel in Australia remains strong as Australians increasingly travel outbound. This trend is driven by a strong Australian dollar and the reducing gap between the cost of overseas and domestic travel which creates a stronger incentive to travel overseas for many Australians as compared to domestic destinations. However, in areas such as Sydney and Melbourne, domestic travel is driven by economic performance with factors such as high inflation and higher levels of personal and household debt (SATC 2008, p. 7-12; Tourism Australia 2010, p. 10-12). Domestic travel has also witnessed challenges due to changes in the labour market which have made it more difficult to travel. Trends such as longer working hours on average, an increased tendency to make labour more casual and people not taking their holiday leave (estimated at 30% of the population) have negatively affected domestic travel (SATC 2008, p. 7-12; Tourism Australia 2010, p. 10-12). The growth of low cost carriers has boosted tourist demand for regions which are covered by them by offering affordable travel while destinations not serviced by such carriers are disadvantaged. However, high petrol prices are likely to suppress the growth in the touting market. In addition, regions which do not offer competitive accommodation also experience lower tourist demand (SATC 2008, p. 7-12; Tourism Australia 2010, p. 10-12). Internal Analysis According to research conducted by Tourism Research Australia, the Australian tourist industry is experiencing intense competition from other leisure choices such as technology, cars and furnishings which offer instant or tangible gratification as compared to travel, the memory of which can be evoked when needed thus reducing the necessity to travel frequently. In addition, there is a shift among Australian consumers to demanding more quality travel experiences as local destinations are perceived to offer lower value for money. Consumers increasingly prefer overseas destinations under the perception that local activities and destinations do not offer the same quality assurances. There is also a travel culture in Australia where the utility of domestic travel is mainly viewed as for functional purposes such as connecting with family or friends or obligations. “Holidays” or recreational travel is taken overseas (SATC 2008, p. 7-12; Tourism Australia 2010, p. 10-12). Strategic Directions, Methods and Evaluation In reference to the purpose and objectives of Tourism Australia set out in the Tourism Australia Act of 2004 and the nature of the internal and external environment that Tourism Australia this strategic plan proposes that Tourism Australia should pursue a strategic direction that focuses on; 1. Intense marketing and promotion of Australia as tourist destination in North Asia and South East Asian countries such as China, Hong Kong, Malaysia and Singapore. 2. Provision of incentives that will enable domestic tourists from low and middle income populations to travel within Australia and experience its unique natural features, landscapes, biodiversity, wildlife and culture. 3. Development of partnership and collaborative relationships with key industry players and stakeholders in the tourism industry in order to effectively target tourists and enhance the economic benefits brought about by tourism. 4. Facilitation of industry development in order to realise sustainable tourism 5. Extensive tourist awareness campaigns within and without Australia so as to create awareness on Australia’s unique natural features, landscapes, biodiversity, wildlife and culture. Methods Integrated marketing, promotion and communication programs Based on the internal and external analysis of the Australia’s tourism industry, it is evident that North Asian and South East Asian countries such as China, Hong Kong, Malaysia and Singapore are the new emerging markets for tourism in Australia. As a result of the global financial crisis, there has been a significant decline in the number of tourists visiting Australia from markets such as Europe and North America. Nevertheless, the number of tourists visiting from North Asian and South East Asian countries such as China, Hong Kong, Malaysia and Singapore has been increasing with time. This shows that there is a lot of potential in these markets that Tourism Australia should exploit For instance China has been Australia’s most valuable tourism market. In the 2010- 2011 financial year, Chinese tourists contributed over $ 3.57 billion to the Australian economy. In order to effectively maximize on the potential of the Asian Market, Tourism Australia should focus on understanding the cultures and needs of consumers in these markets and how these needs can be effectively met (Tourism Australia 2011, p. 14). Besides, focusing on the Asian market, Tourism Australia should also focus on promoting Australia in other key markets such as Europe and North America. Subsequently, the agency should work towards building Australia’s reputation and profile as a desirable and exciting destination for leisure and business events. The agency should undertake an intense marketing and promotion exercise in these markets by employing integrated marketing programs and communication approaches that are culturally sensitive. The approaches used in marketing, promotion and communication should take into account Geert Hofstede’s dimensions of national culture such as; namely; Power Distance Index, Individualism, Masculinity, Uncertainty Avoidance Index and Long-Term Orientation. By taking into account Hofstede’s outlook on dimensions of culture Tourism Australia will be able to implement culturally appropriate approach when it comes to marketing, promoting and communicating about Australia’s Tourism industry (Hofstede & Bond 1984; Kirkman, Lowe & Gibson 2006). The integrated marketing, promotion and communication approach used by Tourism Australia will incorporate the use various media platforms such as the internet, print media and television. Through the use of these media platform the agency will enhance the Australia’s brand equity thus increasing the potential of tourist visits in Australia. This can be achieved by marketing, promoting and communicating about Australian travel experience through major global media platforms that are relevant to the target audience. For instance, in order to target nature and wildlife enthusiasts Tourism Australia should partner with global channels such as Discovery Channel and National Geographic so as to market Australia on a global scale as the ultimate tourist destination. The agency should also capitalise on the use of nature documentaries and world-wide print editorials and advertisements. Business Event Marketing In order to increase the number of tourists who come to Australia for business purposes, the agency will engage in business events marketing. In this case, the agency will focus on undertaking marketing initiatives that will position Australia as a suitable destination for corporate meetings, seminars, conferences and team building activities. In order to realise this, the agency will have to undertake sector research on a global scale, form industry partnerships and carryout public relations campaigns. Provision of travel incentives In order to increase the number domestic tourists especially among low and middle income populations in Australia, it is crucial to provide incentives that will encourage domestic tourism. As established earlier in the internal and external analysis of the tourism market in Australia, factors such as the increasing cost of living impede on domestic tourism. A considerable number of Australia’s low and middle income population consider domestic tourism as an expensive venture meant for the affluent (Jafari 2003, p. 40). Furthermore, a number of consumers in Australia prefer overseas destinations due to the perception that local activities and destinations do not offer the same quality assurances (SATC 2008, p. 7-12; Tourism Australia 2010, p. 10-12). Hence, in order to encourage domestic tourism, it is crucial for Tourism Australia to partner with stakeholders and key players in the tourism industry to provide incentives that will encourage people to travel locally. Some of the travel incentives that the agency in collaboration with other industry stakeholders can provide include; organising affordable tour and travel packages and reducing entry fees in museums, theme parks, natural sites and festivals for local tourists. Industry Development Developing a sustainable tourism industry in Australia is one of the key mandates of Tourism Australia. This strategic plan proposes three dimensions of industry of development. The first dimension entails developing the human resource in this industry. The second dimension entails the development of infrastructure whereas the third dimension of industry development entails promoting environmental sustainability. Human Resource plays a crucial role in the success of the tourism industry. Kusluvan (2003, p. 808) observes that as a service industry, the success of the tourism industry largely depends on the value provided by the human resource during their service encounter with tourists. Kusluvan further notes that the skills, competence, attitudes and behaviours exuded by individuals working within the tourism industry are what determine the quality and success of the industry. Therefore, it is crucial to ensure that investors, business owners, service providers and employees exude the highest level of professionalism and competence in the course of their service delivery. In order to realise this, Tourism Australia should develop industry standards for service delivery. Every service provider within this industry should subsequently be enlightened about these service standards. Moreover, Tourism Australia should initiate regular training programs for service providers within this industry so as to equip them with relevant skills, knowledge and competence that will enable them to deliver quality services. In order to promote industry development in Australia’s tourism sector, it is also essential for the agency to work towards the development of infrastructure within the tourism industry such as; wildlife reserves, museums, accommodation facilities, recreational and entertainment facilities and tourists information service centers. For the agency to realise this goal, it has to work hand in hand with other governmental agencies, non-governmental organisations, community-based organisations and investors. The agency can also partner with investors and developers to facilitate the development of service infrastructure. Promoting environmental sustainability is also another approach that can help to promote sustainability within the tourism sector. Australia’s unique natural features, landscapes, biodiversity and wildlife are some of the key aspects that appeal to tourists. Therefore, it is crucial to safeguard these aspects by promoting environmental sustainability. Some of the approaches that can be used in this case include; educating the public on how to safeguard the environment and engaging in initiatives that contribute to environmental sustainability such as tree planting and recycling among many other initiatives. Evaluation: Key Performance Indicators Key Performance Indicators Target 2013 Domestic pool ; the total number of Australians intending to travel within Australia Atleast 14.5 million (8% increase) International pool; the total number of tourists from foreign countries Atleast 16 million ( 5% increase) Hosted Business Events; number of organisations considering to host their business events in Australia Atleast 10 events in a year. Brand Message; number of tourists who associate Australia with the brand messages communicated through the various marketing, promotion and communication campaigns Domestic; Atleast 5 million International; Atleast 8 million Employment opportunities; total sum of individuals employed within the tourism sector Atleast 750, 000 jobs (25% increase) Revenue; the total amount of money generated by the tourism sector Atleast 110 billion (10% increase) Strategic Implementation Organising, Resourcing, Managing and Monitoring Tourism Australia will implement the strategies set out in this plan through programmes aimed at promoting, marketing and developing Australia’s tourism industry. In order to realise the objectives set out in this strategic plan, Tourism Australia will introduce and organise several programs that will be tasked with specific objectives developed under the plan. These programs include; the Leisure Consumer Marketing Programme, Stakeholder Engagement Programme, Industry Development Programme and the Business Events Australia Programme. These programs will be led by a program coordinator who will work with a team of six representatives representing the six states; New South Wales, Queensland, South Australia, Victoria , Western Australia and Tasmania. In order to run these programmes effectively, the agency will set aside a suitable amount of funds for each programmes depending on the activities that each program engages in. The agency will also rely on funds and support provided by relevant stakeholders within the tourism industry. The programme coordinators of each of these programs will on a regular basis meet with the representatives to discuss the undertakings and progress of each program strategy. The program coordinators will be charged with the responsibilities or managing and overseeing the overall implementation of the strategic plan. Under the program coordinators, the representatives will be expected to write monthly reports indicating their undertakings and progress. These reports will then be disseminated to relevant stakeholders and authorities for monitoring. Subsequently, the program coordinators will report to the Managing Director who will in turn report to the Board. . The table below summarizes the key roles of the programs that will be instituted so as to realise the goals of this strategic plan. Programme Function Leisure Consumer Marketing Programme To influence individuals, groups and families from foreign countries to travel to Australia for leisure through various marketing, promotion and communication campaigns Industry Development Programme To develop a sustainable tourism industry in Australia through human resource development, infrastructure development and promoting environmental sustainability Stakeholder Engagement Programme To develop involvement, collaborative , relationships and partnership with government agencies, investors, service providers, non-governmental organisations, community based organisations, tourists and other relevant stakeholders Business Events Australia Programme Undertaking marketing initiatives that will position Australia as a suitable destination for corporate meetings, seminars, conferences and team building activities References Australian National Audit Office (ANAO) (2008). Performance Audit: Tourism Australia. Retrieved November 9 2012 from Grand, R. & Jordan, J. (2012). Foundations of Strategy. West Sussex, UK: John Wiley & Sons, Hofstede, G. & Bond, M. (1984). “Hofstede’s culture dimension: An independent validation using Rokeach’s value survey”. Journal of cross-cultural psychology 15(4), pp.417-433. Jafari, J. (2003). Encyclopedia of Tourism. New York: Routledge. Kirkman, L., Lowe, B. & Gibson, C. (2006). “A quarter century of Culture's Consequences: A review of the empirical research incorporating Hofstede's cultural value framework”. Journal of International Business Studies. 36(3), pp. 285-320. Kusluvan, S. (2003). Managing employee attitudes and behaviour in the tourism and hospitality industry. New York: Nova Publishers Northern Territory Government (2007). Five Year Tourism Strategic Plan. Retrieved November 9 2012 from South Australian Tourism Commission (SATC) (2008). South Australia’s Strategic Plan: Tourism Implementation Plan. Retrieved November 9 2012 from Tourism Australia (2009). Corporate Plan: 2010-2013. Retrieved November 9 2012 from Tourism Australia (2010). Corporate Plan: 2011-2014. Retrieved November 9 2012 from Tourism Australia (2011). Tourism Australia Annual Report 2010-2011. Retrieved November 9 2012 from Tourism Australia (2012). About Us. Retrieved November 9 2012 from Tourism Australia (2012b). Our Mission. Retrieved November 9 2012 from Read More