Free Marketing Essays - Key Macro Environmental Issues Affecting Tourism in Australia
The key macro environmental issues affecting Australian Tourism can be highlighted by way of PESTLE (Political, Economic, Social, Technological, Legal and Environmental) Analysis. The main issues therefore can be discussed in terms of the following factors:
A. Political Factors
The important Political factors concerning the Australian Tourism Industry are:
· International Political Stability: The good performance and growth of the Australian Tourism industry depends a lot on Political stability in other countries. A stable peaceful global environment helps in the growth of tourism whereas the impact on tourism is negative at times of unstable political situation such as during the Gulf War in the past.
· Emphasis on Growth without damaging the Environment: The Government wants the tourism industry to grow and prosper but without damaging the natural environment.
· Formation of Tourism Australia in June 2004: The Government’s emphasis on growth of tourism is also reflected by the recent formation of Tourism Australia which is the Federal Government Statutory authority responsible for international and domestic tourism marketing.
B. Economic Factors
The key Economic Factors that influence the Australian Tourism Industry are:
· Global Economic Prosperity: The tourism industry in Australia is influenced by economic prosperity in other countries. This is because good economic conditions in other countries mean that people in general will have higher spending power and therefore they are more likely to come to Australia. The reason why growth in tourism industry in Australia has slowed down in recent years is because of general recession in world economy over the past few years. Thus people in other countries have been under more economic pressure and so have spent less on travelling and holidays. Also the countries like Hong Kong, Singapore and South Korea are gaining more popularity as tourist destinations. This is due to the economic global recession and also because of the geographic location of these countries. Travelling to these countries from most Asian and European countries is cheaper and takes less time as compared to travelling to Australia.
· Current Economic Condition in Australia: Despite of the general recession in global economy, Australian economy was ranked as the most resilient in the world in 2004. Economic growth is expected to be 3.7% in 2004 and 4% in 2005 as compared to the OECD average of 3%. Thus the economic conditions in Australia are better then that in other countries. Even though there was some decline in 2003 but still the country has shown almost uninterrupted economic growth for 13 years up to 2004 – OECD (2003). OECD (Organisation for Economic Cooperation and Development) had also stated that during this period Australian Economy grew at a faster rate in comparison with the average growth of economy for other developed countries. In terms of receiving Foreign Direct Investment, Australia ranked third in 2003 in the Asia-Pacific Region after China and Hong Kong. Tourism accounts for more then 11% of exports and about 6% of the total workforce is employed in tourism industries in Australia. Therefore Australia is in a strong position to invest more in promoting the tourism industry to international tourists. Also a strong economy in Australia means a positive sign for the domestic tourism industry as well.
C. Socio-cultural Factors
The important Socio-cultural issues affecting the Australian Tourism Industry are based on the following factors:
· Type of Tourists and Holidays Preferred: According to Tourism Australia Report (December, 2004) there were 4.8 million visitors aged 15 years and more to Australia in 2004. This was 9% more then that in 2003. Sixty percent of these travellers had visited Australia before. Also 70% of the travellers were non package tour visitors and the most visited regions were Sydney (53%), Melbourne (26%) and Brisbane, Gold Coast and Tropical North Queensland (17%). The most popular activities preferred by tourists was shopping (84%) and spending time at the beaches including swimming, surfing and diving (81%). There has been a decrease in the number of visitors coming from Japan, China, Singapore, Hong Kong, USA and Canada while the number of visitors coming from UK, New Zealand and Korea has increased. In terms of the purpose of visit, 54% came for holidays, 21% for visiting friends and relatives, 15% for business purposes and the rest 10% for education, employment and other purposes. The average duration of stay of a visitor was 27 nights in Australia in 2004.
· Cultural Mix and Origin of Domestic Population: The population in Australia is quite diverse. Wide ranges of people of different cultures and from different countries have now settled in Australia permanently. These people have a lot of contacts, friends and relatives in countries all over the world. This helps the tourism industry in attracting even more tourists from abroad because people often do come to visit their friends and relatives.
· Festive Seasons and Special Occasions: This is another important factor that influences the tourism industry. The Chinese New year has quite a significance impact on the number of tourists coming to Australia in January and February. Similarly during Christmas holidays and Easter and summer breaks, the number of tourists visiting Australia increases considerably.
D. Technological Factors
The Technological factors that are influencing the Australian Tourism Industry are:
· Internet and E-Commerce: Like all other industries, the tourism industry is also influenced by the growth in popularity of the internet and e-commerce. These technologies are helping the tourism industry in promoting Australia as a key tourist destination to people all over the world. 33% of visitors used the internet to get information about Australia in 2004 as compared to 22% in 2003 – (Tourism Australia, December 2004). Interested travellers were able to find the relevant information related to popular destinations, accommodation, available flights etc. without much hassle. Further e-commerce has enabled easy online payment and tourists can book for holiday packages and arrange everything using the internet from their homes.
· Increase in Alternative Leisure Options: The technological advancement and developments have also lead to the availability of high-tech multimedia leisure and entertainment devices. This is having a negative impact on the tourism industry and the domestic tourism industry in Australia is believed to be losing out to alternative leisure pursuits by people.
E. Legal Factors
The important legal concerns for the Australian Tourism Industry are:
· Procedures for Getting Tourist Visa: Due to the increasing fear of possible terrorist attacks and immigration, the visa procedures have become strict in countries all over the world. This also is an issue of concern for the tourism industry. The necessary documents required even for a tourist visa have increased. This can be a hassle for interested travellers e.g. people in Europe may opt to go for holiday to another European country to avoid the increasing formalities and documentation required in obtaining a visa.
· Environmental Laws and Regulations: There are already concerns that the tourism industry is damaging the environment and therefore a big challenge for the tourism industry is to attain growth without adversely affecting the environment.
F. Environmental Factors
The key Environmental issues concerning the Australian Tourism Industry are:
· Maintaining the Rich Biodiversity: Australia is known for its rich biodiversity but many plants and animal species are now in danger of getting extinct due to habitat alteration and loss or competition and predation from introduced species.
· Pressure on Ecosystems: The farming methods used in Australia have adversely affected the biological diversity and ecosystems. It has lead to Dryland Salinity and Water Scarcity in many areas of Australia. Tourism has also increased pressure on environment and on Australia’s water resources.
2. Key Issues based on their Impact, Probability and Urgency
The table below provides information about the key issues of concern for the Australian Tourism Industry. The issues are ranked in order according to their Impact, Probability and Urgency. Thus the issues that have a high impact on the tourism industry, have a high probability of happening as well as are of high urgency have higher ranks and are towards the top of the table. In contrast the issues having less impact, lower probability and low urgency have lower ranks and are towards the bottom of the table.
From the table we can see that the issue of the adverse impact of Tourism on Biodiversity is the issue of highest importance. This is because tourism is having a high impact on biodiversity in Australia and many species are in danger of getting extinct. The probability of happening of this is also very high and because immediate measures are required to deal with this situation so the urgency is very high as well.
The second most important issue that affects Australian Tourism is International Political Stability. The impact is high because in times of instability the number of tourists coming to Australia falls considerably. However the probability of a sudden change in international political stability is medium with no immediate fear of sudden change. The urgency however will always be high for issues related to international political stability.
The issues of lower ranks are those that do affect the tourism industry but the impact is not very high. The urgency to deal with these issues is also medium or low. Thus we can see that the issue of Strict Procedures for getting Visa is the one with the lowest rank. This is because even though due to international fears of terrorist attacks, the visa procedures have become stricter, yet this is not an issue of high impact or urgency because genuine international travellers will still be able to get visas to travel to Australia.
3. Strategic Plan for Australia for the next 2-3 Years.
A strategic plan for Australia for the next 2-3 years can be presented and explained by using the Ansoff’s Market/Product Matrix. The matrix can be used for assessing the most promising direction for the Australian Tourism Industry and its marketing activity.
The plan and recommendations for the Australian Tourism Industry on the basis of Ansoff’s Model are as follows:
Market Penetration of Tourism
This relates to the current situation in which the Tourism industry and the Australian Market are at present. Thus the initial approach for Australia needs to be that of Market Penetration. This means that steps should be taken to fully reap the benefits of the current state of the market. This will include the following:
· Organising of more sports and national and international events to attract tourists. The number of tourists coming from USA and from most Asian countries like Hong Kong, China and Singapore is on the decline and so organising more international and sporting events and can be a good strategy to attract travellers from these countries.
· Greater promotion of different destinations within Australia and encouraging people who come to Australia to travel around the whole of Australia. At present the majority of tourists only visit the cities like Sydney, Melbourne and Brisbane.
· Influence the native home population to travel more to different destinations within Australia.
· Effective monitoring and reporting of the effects of national and international tourism on the natural environment.
· Establishing and promoting sustainable tourism standards and practices.
Product or Tourism Development
After market penetration, the next strategy for Australia can be explained in terms of Product Development or in this case the development of tourism. The economic condition of Australia is good and so the country is in a position to make the required investments which will help in the increase of tourism in the existing market. This will involve:
· Development of more parks, museums and leisure destinations within Australia to attract more tourists.
· More promotions such as “Song for Australia” (songwriters were asked to write a song that captures the essence of Australia) that will inspire people in overseas countries to visit Australia.
· Greater emphases on attracting tourists from countries like USA and UK as these economies are expected to perform well and so greater number of tourists can be expected.
· Effective use of the opportunities provided by the internet to promote Australian Tourism all over the world.
· Insure effecting recycling measures to reduce the adverse impact on the environment.
Market Development of Tourism
This relates to the development of Australian Tourism in countries from where very small numbers of travellers come to Australia. This includes Russia, South Africa and countries in the Middle East. The key strategies will be to:
· Promoting Australian Tourism in these countries by way of visits and presentations by important industry leaders to these countries.
· Organising cultural events of importance to people in these countries in Australia and including their history and achievements in museums in Australia.
· Further promotions can be done by marketing Australia as an ideal shopping destination to people in these countries and by introduction and promotion of more ecotourism tours and holiday packages.
· In countries like Russia, more emphasis should be to highlight the wonderful summer season and the beauty of Australian beaches to attract travellers.
Diversification
This will involve moving into new regions within Australia and providing entirely new tourism experience. Therefore new tourism concepts and products will need to be developed in new markets to distinguish them from the existing tourist destinations. This will make the new destinations more appealing to the travellers from Australia and abroad. This will include the following:
· Influencing the in-bound tour operators to come up with tour packages for new and less explored regions within Australia.
· Fostering partnerships with retail businesses to add value to tourist experience at new destinations.
· Develop and promote exclusive customised business and corporate tour packages to international companies.
In conclusion it can be said that, Australia at present is in a good economic condition and it can use this situation to strengthen its tourism industry and to deal effectively with the increasing environmental concerns. The future growth of tourism in Australia will depend on how well it will be able to maintain large number of travellers coming from countries like UK and New Zealand as well as attract travellers from new markets. This will also very much depend on how effectively it will be able to maintain its rich biodiversity and environment which makes it so distinct and attractive then other countries.
BIBLIOGRAPHY
· Kotler, P. 2002. Marketing Management (International Edition): Pearson US Imports & PHIPEs
· Robinson, G., Loughran, R. & Tranter, P. 1999. Australia & New Zealand: Economy, Society & Environment, London: Hodder Arnold
· Horner, S. 2003. International Cases in Tourism Management, Oxford: Butterworth Heinemann
· Brown, F. 1998. Tourism Reassessed: Blight or Blessing?, Oxford: Butterworth Heinemann
· Lawson, M. 1993. The Battle for Room Service: Journeys to all the Safe Places, London: Pan
· OECD. 2001. OECD Economic Surveys: Australia, Paris: OECD
· Smith, R.M. 1999. The National Geographic Traveller: Australia, Washington DC: National Geographic Society
WEBSITES
· http://www.tourism.australia.com – Tourism Australia
· http://www.afta.com.au – Australian Federation of Travel Agents
· http://www.atec.net.au – Australian Tourism Export Council
· http://www.industry.gov.au – Australian Government Site
· http://www.isr.gov.au – Australian Department of Industry Science & Resources
· http://www.ecotourism.org.au – Ecotourism Association of Australia
· http://www.pata.org – Pacific Asia Travel Association
· http://www.ttf.org.au – Tourism Task Force of Australia
