ITS: Tailor products to growth markets
9 May 2017 By Bridget O'Connell
The tourism industry must keep working hard to produce products for New Zealand’s growth markets according to Auckland Airport chief executive, Adrian Littlewood.
Speaking at the airport’s fifth annual International Travel Summit, Littlewood acknowledged the great effort that has seen visitor numbers to New Zealand reach 3.5m annually.
He highlighted the 25% uptick in visitors from the United States as a result of new routes creating additional capacity and urged the tourism industry to consider these visitors.
Littlewood said: “The key thing from our point of view is to keep working hard on your product and your portfolio and how you are addressing the markets that are coming in, particularly the US.”
“In that context the word we all collectively must think about is seasonality. Trying to draw passengers throughout the year not just in the peak is really, really, important and really goes to helping the airlines install confidence in the sustainability of their air routes for the long term.”
He called on the tourism industry to remember Australia as a key market.
“Don’t forget Australia. It is just across the ditch, and is important. There is a barrier we have to get over with Australians who see us as always being here and they will get here one day.
“We’ve got to figure out how we get them here now and what kind of product we need to convince them that now is the time to come.”
He pointed to events such as marathons and food and wine activity as an indicators of “how we can make that happen”.
Littlewood celebrated the great growth of recent years – with Auckland Airport and the tourism market in general – putting connectivity and capacity at the heart of that growth noting it was important to acknowledge the role the airlines play in delivering increased passengers to NZ shores.
However, he warned against becoming complacent and added that investment must be made for future growth as well as for when the cycle inevitably turns.
“We can’t forget the peak. How do we keep making sure that we are building capacity to deal with the growth as it comes along not just thinking that we can spread the load – we have to keep investing in headroom for the future.”
“We’ve got to remember that this is a good time for tourism now, but it will inevitably go through cycles. How do we make sure we can hold our shape through the growth times invest for the future and make sure we are setting up our industry for the long term.”
His colleague Scott Tasker, GM (Acting) Aeronautical Commercial, explained that the capacity growth at Auckland Airport over the recent two years has just been catch-up.
“In the last 18 months introducing 11 new airlines and 18 new routes demonstrates significant growth. But it is really clear progress to date has been catch-up.
“We need 66% growth in incoming international seat capacity to hit our 2025 targets of 5m visitors to New Zealand.”
The airport is now heading into the “keeping-up capacity phase”.
Using a model to identify under service he revealed there is still vast capacity available from traditional markets such as the UK – especially Germany – the US and Australia.
This opportunity has been opened up through the introduction of direct routes from Dubai and Doha which are the pipeline for increased visitors from Europe.
Tasker also highlighted a number of markets which are still underserved such as South Korea, and separately India which has no direct flights to New Zealand.
India offers” fantastic growth which won’t be realised until the capacity is opened up. We currently have 54,000 visirors from India who all fly indirect. To get growth we need direct flights.”
Like Littlewood he highlighted the opportunity for operator’s to develop products to cater to the increasing US market claiming “there has never been a better time to go to that market and get your tourism products in there. And think about new markets beyond the traditional West Coast markets we now have capacity to facilitate good visitation from markets like New York.”
Looking ahead, Tasker said Aucladn Airport does not forecast “explosive growth” like 18 new routes in the next two years but said there was still a significant pipeline of opportunity.
He added it is crucial for work to be done to sustain the increased capacity.
“An airline can make a choice to deploy that $200m dollar piece of capital equipment to Dusseldorf or Auckland so as an industry its really important that we continue evolve our tourism offering, make sure we have attractive experiences and that we are telling the New Zealand story.”
Article Tags: International Travel Summit