Keeping New Zealand front of mind
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- Written by Rachael Shadbolt, Executive Officer, HCNZ
'Perfect storms, peaks and troughs' and 'business displacement' all made the headlines at various times during the year.
These phrases summed the year up rather well, so it is with cautious optimism that the hotel sector looks towards 2012, hoping for a more settled period of business.
Amongst everything that happened in 2011, it was the Rugby World Cup that had everyone's attention. NZHC has been asked on numerous occasions – Did hotels enjoy RWC 2011? Put simply, yes they did. Hotels in regions where games were being played or teams were training, definitely benefitted from the event, but traditional September and October corporate and conference business, that normally keeps hotels busy during that time, all but stopped.
Overall occupancy levels for September and October were on a par, if not slightly below, the same 2010 period. However, Average Daily Rates were up in most regions and this was due to strong market driven demand around the RWC game days in those regions. These regions filled up one day prior to a game and emptied out the day after. Between games, room rates were pitched at normal mid-week rates, sometimes lower as the mid-week corporate guest didn't travel during RWC. The expected major event business displacement played out with a very strong pre RWC August in corporate and conference business and a better than expected post RWC November. Normal business resumed almost immediately after the RWC Final. For Wellington in particular, this was an excellent November result, as an election month generally means a significant decrease in corporate and government business.
Looking ahead, two more tough years is the general consensus amongst many industry colleagues. Traditional western markets like UK/Europe, North America and Australia have yet to show any real signs of recovery. Group series business continues to decline and is unlikely to return to pre GFC levels. However, new markets are showing good visitor numbers, particularly China and Malaysia. New low cost airlines, like Air Asia X flying into Christchurch this year, resulted in significant increases in Malaysian visitor numbers into the South Island. This could not have come at a better time given the ongoing disruption of visitor flows due to the Christchurch earthquake and the current lack of hotel accommodation in that region.
The cruise season is also looking good for those hotels that look after the pre and post cruise passengers. Cruise is increasingly being touted as the new 'tour' holiday option and for the 2011/12 cruise season New Zealand will host 116 voyages, a 25 per cent increase on last season. Many would assume that the cruise market is of little interest to the hotel sector, and while it has to be acknowledged that this is yet another accommodation option for visitors, many hotels do benefit from this sector. Cruise ships bring people into the secondary regions and they inject money into the local economy. More and more often, cruise passengers are choosing to stay on in New Zealand after their cruise and hotels benefit from this also.
Another boost for 2012 is Prime Minister John Key continuing as tourism minister. Having the Prime Minister as Minister of Tourism has given the tourism sector a much higher profile and has promoted the visitor industry as a significant economic driver for New Zealand.
With a couple more tough years still ahead of us, we must use every opportunity to ensure that New Zealand remains front of mind as a visitor destination. Certainly the RWC has given us global coverage that money simply cannot buy. It is now up to us to leverage that unprecedented exposure in the years to come.
