It’s the tourism product stupid – not marketing! John Menadue

Jun 10, 2013

The Australian tourism industry tells us often that we need to spend more in marketing and publicity and that the tourists will come. I have always been sceptical; believing that what matters most is the tourism product itself.

Marketing didn’t work with the Oprah Winfrey circus despite the government tipping in $5 million. On top of that, Australian tourism agents provided accommodation and support for 300 of the fans who accompanied Oprah. The Australian dollar was certainly strong at the time but the net result of Oprah’s visit seems to have been a drop in tourist numbers not only from the US, but also from the UK and Canada where the Oprah circus was televised.

A myth was also created years ago about Paul Hogan with his ‘shrimp on the barbie’. The growth in tourist numbers at that time came from Japan, not the US. It was achieved by increasing the flights on the Japan-Australia route from 4 to 25 per week over three years. It was not marketing. As CEO of Qantas, I kept Paul Hogan and his ‘ocker’ type of commercials as far as possible from Japan.

Tourism numbers have certainly grown but a lot of the growth comes from hopping from one market to another – Japan, Korea and now China. But we don’t get enough repeat business. Our tourism product has not been good enough to encourage more tourists to return.

I was not surprised that in its submission to the Henry Enquiry about Australia and the Asian Century the Australian Tourism Export Council said “one of the great challenges for the Australian tourist industry is its ability to provide a quality product that meets the needs of the Asian travellers.” It is true of all travellers.

We have had success in encouraging more airline services, but there are still many product improvements that we need to focus on. I would suggest the main ones are as follows.

  • The quality of service at our international airports is poor. For the first time since 2008, The Australian Competition and Consumer Commission in its latest report did not rate one of our airports as ‘good’… Sydney airport, our main gateway was the worst in performance. With their quasi monopoly position our airports are providing poor service and reaping large profits. Prices are up and service is down. Parking is a rip-off. One can hardly walk to the departure gates without going through an annoying labyrinth of duty-free stores.
  • Sydney badly needs a second international airport that is curfew free… Commonwealth and state governments and the tourism industry have been avoiding this key issue for 40 years. It must be resolved.
  • Our taxis are amongst the most expensive in the world. But it is not the taxi drivers who are reaping the benefits. Government regulations protect the licence plate-owners.
  • In Sydney we have very good seafood at the Sydney fish market, but the infrastructure and parking is a shambles.
  • Australia will always be a more expensive destination for a holiday because of distance, but tourists would get better value for money if we had more 3-4 star accommodation.
  • With few exceptions, what is the tourism industry doing to improve our inferior customer service in such areas as language, signage and catering? Are we really responding adequately to the new China market and the Indian market that will follow?

The Oprah Winfrey and Paul Hogan spectaculars divert our attention from the real issue – improving the tourism product.

John Menadue


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