Eyes on the sky, but doubts on the ground

Is the domestic rescue package our ticket to tourism recovery?

Video: Arthur Cauty / Adobe Stock

Video: Arthur Cauty / Adobe Stock

From the tourism industry rescue package to domestic holiday deals, UQ experts explore what it will take to keep Australian travel in the air.

Wanderlust is considered part of the national identity for most Australians. And with international travel on hold during the pandemic, it appears that the desire for domestic travel might be the key to keeping Australian tourism afloat until international borders reopen.

According to a recent survey by KPMG, 61 per cent of Australian respondents said they were planning on booking a holiday between January and June 2021, and 72 per cent said they would book a holiday between July and December 2021.

The timing of the Australian Government’s recent roll out of the $1.2 billion rescue package for tourism and aviation was fortuitous. The package will see travellers take advantage of half-price flights to 15 regions (pending border restrictions), with bookings open until 31 July for travel by 30 September this year.

“This is our ticket to recovery – 800,000 half-price airfares to get Australians travelling and supporting tourism operators, businesses, travel agents and airlines who continue to do it tough through COVID-19, while our international borders remain closed,” the Prime Minister said in a recent press conference.

The initial list of locations include Broome, Avalon, Kangaroo Island, Lasseter and Alice Springs, Merimbula, Launceston, Devonport, Burnie, Gold Coast, Sunshine Coast, Tropical North Queensland (Cairns), Whitsundays and Mackay (Proserpine and Hamilton Island), Adelaide, Darwin, Townsville and Hobart.

Click on the interactive map to view the destinations.

A blue suitcase and a parked small private jet.

Image: Михаил Решетников / Adobe Stock.

Image: Михаил Решетников / Adobe Stock.

Tourism and visitor behaviour expert Associate Professor Pierre Benckendorff, from the UQ Business School, said that this short-term strategy to stimulate air travel was a win for these select locations – but doubts remained about whether the package would benefit businesses beyond the major airlines.

“The big beneficiaries are the airlines and the destinations included in the scheme. Given that Virgin and Qantas are based in Brisbane and Sydney, these cities will benefit as the airlines can support more aviation jobs in these locations,” Benckendorff said.

“But there are losers as well – these include destinations that are not part of the scheme, most likely because they do not have large airports. Some of these destinations are too far away from major markets to benefit from road trips.”

“Even for destinations included in the scheme, there is some doubt whether the benefits will trickle down to small and medium businesses and the outcome is that more jobs will be lost and some businesses will close.”

Map of Australia with pins dropped at various city locations.

Image: Catarina Sousa / Pexels.

Image: Catarina Sousa / Pexels.

While the rescue package promises to get hundreds of thousands of Australians back in the air, UQ School of Political Science and International Studies Lecturer Dr Glenn Kefford questioned the political motives behind the regions chosen, given that most of the destinations happen to be in marginal seats.

“All policy decisions are political, as governments need to decide how to use finite resources, but the Australian Government has shown a willingness to ignore advice from the public service and to make policy announcements which appear solely designed to serve political goals,” Kefford said.

“Criticism of the politicised nature of these programs are not unusual, but the sidelining of the public service appears to have reached new levels. The Australian Government has subsequently expanded the program to other regions after significant criticism of the initial announcement."

Table served with appetisers and red wine for a lunch in a vineyard.

Image: StockMediaProduction / Adobe Stock.

Image: StockMediaProduction / Adobe Stock.

Despite doubts about the scheme, travel marketing expert Associate Professor Gabby Walters, from the UQ Business School, said that the impact of domestic spend shouldn’t be underestimated.

“Previously the Australian market would have seen holidays booked to Bali, or holidays booked to go skiing overseas in winter. So, now we have Australians with disposable income and they can’t travel overseas. The next best thing they can do is get out there and book trips across the regions,” Walters said.

"Domestic holidaymakers can best help by travelling and spending money locally. If they can’t travel, they might consider spending money on local products, like Australian wine, cheese and artisan goods."

“Holidaymakers also need to support Australian and Indigenous cultural activities that they wouldn’t normally think about attending as a local. People in urban centres can go to art museums, shopping centres, theatres and restaurants to help fill the gap made from the loss of international tourists.”

From the industry standpoint, Walters said the best thing tourism operators could do in the meantime was to pivot their business model to appeal to the domestic market. 

“It’s all about the industry re-directing their focus to the domestic market. Historically, people spent a lot of time and effort getting what we called ‘China ready’ – getting materials translated, and ensuring that their products appealed to the Chinese market,” she said.

“And while that market will return, in the meantime it’s about asking what domestic tourists are looking for. It’s about shifting the focus to becoming ‘Australia ready’.”

From 19 April 2021, Australians will be able to fly to New Zealand as part of a trans-Tasman COVID travel bubble. According to Walters, the announcement of the New Zealand travel bubble means that the industry will need to double-down on their efforts to appeal to Australian travellers.

"This New Zealand travel bubble makes it even more important to appeal to domestic segments as they are no longer a captured market, and these choices may increase as we welcome more countries into the bubble – like the Pacific Islands, for example," Walters said.

"Luckily, the Australian and New Zealand travel segments could be seen as having similar needs and wants, given the cultural similarities between the two countries."

“Everyone around the world will want to return to travel at some point – but it’s just a matter of sticking a band-aid on it in the meantime to ensure the wound doesn’t bleed out.”

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