industry analysis 4 Queensland tourism - Tourism Queensland

4 Queensland tourism
industry analysis
Kewarra Beach, Cairns

Trends and influences
Tourism is subject to a range of global influences, events and forces that impact on the sustainability of the industry at statewide
and regional levels. The diagram below outlines some of the issues and trends in the macro environment that may have an impact
on tourism in Queensland.
Economic trends
• Fluctuating global economies and
variable exchange rates will continue
to influence travel demand
• Variable fuel prices will influence
transport supply and demand
Political/legal trends
• Terrorism will be ‘top of mind’ and
travellers will adjust
• Security measures will be standardised
around the world and their cost will
increase airfares
4 Industry analysis
Natural environment trends
• Environmental and social awareness
will increase
• Natural disasters and geo-political events
affect travel behaviour
Market trends
• Increasing market fragmentation, and
growth in special interest/niche markets
• More frequent, shorter holidays
• Travellers will have higher service
expectations
• More travellers will require customised
holidays
• Travellers will use new media technology
more for information, booking and sales
• Emerging travel markets in developing
countries will influence travel demand
• As baby boomers retire en masse from
2010 to 2020, they will shape demand
• Trend towards the accumulation of leave
entitlements
• Increased price sensitivity
Tourism
Industry
Technology trends
• Technology will continue to develop at a
rapid pace and involve all sectors of the
industry
• Mobile phones will be used to plan and
organise holidays
• High-definition televisions and computers
will provide virtual visits to a destination
• Innovations in transportation will affect
range, speed, comfort and safety of travel
Industry trends
• Liberalisation of air transport and low cost
travel will influence travel demand
• With greater speed and capacity, remote
and long haul destinations will be more
accessible
and affordable to many travellers
• Oversupply of undifferentiated travel
products and destinations will affect
competitiveness
Competitive trends
• A new hierarchy of destinations will take hold as Asia, the Pacific Islands and India
become more popular
• Competition among countries will be more intense
• Regional economic agreements will facilitate travel within trade zones
• Tourism will become a regional, rather than a global, phenomenon
• More substitutes for travel
Social & cultural trends
• Growing urban and coastal populations
• Ageing, affluent, active Western
population
• Emerging middle class in developing
cities
• Risk of a disease pandemic is growing
• Growing concerns for safety and security
Diagram 5: Tourism industry trends and influences
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4 Industry analysis
The impact of ‘peak oil’ and
rising oil prices
The QTS consultation process identified rising oil prices
as a key industry concern. Between January 2000 and
August 2006 the price of fuel in Brisbane increased 87
per cent, from an average of 68 cents per litre to $1.29
per litre. 8
The Australian Association for the Study of Peak Oil
(ASPO) has raised concerns that Australia’s principal
foreign exchange earner, tourism, is particularly
susceptible to rising fuel prices and the impact of ‘peak
oil’ due to its dependence on long-distance air travel.
‘Peak oil’ occurs when the world’s reserves of oil have
been reduced by approximately half and fuel production
falls into decline. When this will occur is the subject of
much debate.
Strengths, weaknesses,
opportunities and threats analysis
An analysis of strengths, weaknesses, opportunities and threats
(a SWOT analysis) provides insight into the internal capability of
tourism in Queensland in relation to its competitors. It identifies
the industry’s strengths, the opportunities for development and
growth, the weaknesses that present obstacles to sustainable
growth and the potential threats to the industry. Emerging from
this analysis are the key challenges facing the industry (see the
following SWOT analysis).
The challenges identified through the SWOT analysis are
consistent with the key issues identified through industry
consultation and are addressed within the action plans detailed
in chapter six, Achieving our vision – making the difference.
Rising fuel prices impact on both consumers and
individual tourism businesses. For the consumer, higher
fuel prices act to reduce disposable income and the
ability to purchase travel products. From an economic
perspective, rising operating costs and overheads
affect the viability of tourism businesses.
As a transport intensive business, tourism is highly
sensitive to changes in fuel prices. This is particularly
evident in aviation, where rising fuel costs contributed
to the recent increase in fuel surcharges to cover
operating costs.
Rising fuel prices are of great concern for Queensland
destinations that rely on the drive tourism market. Drive
tourism constitutes 75 per cent of all domestic travel in
Queensland and is especially important to regional
Queensland where up to 70 per cent of visitors arrive
by car.
The Queensland Government fuel subsidy of 8.3 cents
per litre is helping define our State’s competitive
advantage by cushioning the impact of rising fuel
prices for motorists who take holidays in Queensland.
For further information on peak oil, visit the Association for
the Study of Peak Oil (ASPO), www.aspo-australia.org.au.
Road to Horseshoe Bay, Bowen, Whitsundays
8 FUELTRAC – www.fueltrac.com.au.
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Queensland Tourism Strategy – November 2006

Spring blossum, Granite Belt, Stanthorpe
SWOT Analysis
STRENGTHS
Tourism’s significant contribution to the Queensland economy
Population growth driving infrastructure development
Queensland perceived as a safe destination
Good growth in domestic and international expenditure over five years
Queensland is the most preferred domestic holiday destination for
Australians
Forecast high international growth to 2014
Well-established brand in domestic markets
Queensland is an aspirational brand overseas
Queensland has abundant natural and built attractions
Queensland has a wide range of holiday/leisure experiences
Long established industry structure and RTO/LTO coordination structure
Generally well-developed relationships between industry stakeholders
with respect to marketing activities
Low cost air access
WEAKNESSES
Importance of tourism not sufficiently recognised
Standards and consistency in product and service quality vary
Significant growth in outbound travel
Flat growth in domestic visitation over five years
Lack of investment in new serviced accommodation, new product,
services and niche experiences
Lack of resources for protected areas to ensure appropriate development
Variable community support for tourism and awareness of value of tourism
Levels and quality of planning for tourism at local government level vary
Non-systematic approach to assessing the costs and benefits of tourism
to local communities
Lack of role clarity between various agencies
Lack of coordination across federal, state, and local governments
Shortage of skilled workforce
Infrastructure may not be keeping pace with growth; adversely
impacting on tourism
4 Industry analysis
OPPORTUNITIES
Prospect of global political instability/safety and health risks overseas
boosting domestic and inbound visitation
Uncertain global and domestic economies impacting on travel choice
and behaviour
Changing demographics and family structure impacting on travel
choices, needs and interests
Population growth in South East Queensland
Increase in worldwide use of new technology
Increased need for shorter, more frequent holidays – domestic
Emerging international markets and opportunities for new business
Increased desire for specialised / customised holiday experiences
Low cost air travel and opportunities to increase inbound travel
Greater consumer consciousness of destination safety, security and
health issues
New media technology and opportunity to reach new customers directly
Innovations in transport technologies – range, speed, safety, comfort –
bringing long haul markets closer
Greater public awareness of, and interest in, sustainability and
environmental issues
THREATS
Increasing oil and fuel prices
Tougher competition from other markets
Adverse impacts of tourism on the natural environment
Adverse impacts of natural disasters on destination appeal and
perceptions
Falling quality of natural resources and attractions
Innovation in communication technologies – could move quicker than
we can match
Lack of a strong tourism voice in government planning and policy forums
Population and visitor growth putting pressure on public infrastructure
Population expansion and residential development changing the
character of Queensland experiences
Higher expectations of product and service quality
Low cost air travel and implications for outbound travel
Low cost domestic air travel and implications for drive destinations
Changing workplace dynamics/regulations impacting on leisure
choices and behaviour
Multiple destination approach to marketing may lead to a fragmentation
of key messages
Challenges
Capitalise on Queensland’s international reputation as a safe
destination while implementing crisis management plans to mitigate
the impact of shocks
Continue to encourage visitor expenditure by targeting new and
emerging markets, while recognising that these same markets
represent a growing competitive threat
Facilitate investment in general and tourism-specific infrastructure to meet
the needs of both a growing domestic population and the tourism industry
Maximise the benefits of low cost access by air to Queensland, while
addressing the threat of increasing outbound travel
Maximise the benefits of Queensland’s diverse products and strong
multi-destination brand awareness, while ensuring that promotional
messages are not fragmented
Find opportunities to strengthen the tourism industry’s collective voice
to encourage a greater recognition by decision makers of the industry’s
contribution to the economy
Capitalise on changing demographics and consumer travel choices
and expectations by addressing weaknesses in service standards and
the shortage in skilled labour
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