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Cheaper travel deals as tourism goes 100 per cent pure local

Friday, 22 May 2020

Tourism New Zealand's new campaign is designed to change Kiwi attitudes to holidaying in NZ. (Video first published May 22, 2020)

Fancy a week in a rental motorhome that will cost you hundreds rather than thousands?

Or a night in a flash hotel with an 80 per cent discount?

Coronavirus may have restricted travel, but it is also spawning some very tempting offers as tourism comes to grips with a much smaller 100 per pure local market of more budget conscious customers.

Businesses previously reliant on free-spending international travellers are seriously rethinking what they offer and how much they charge.

**READ MORE:

A recent Deloitte report said “retained spending” by Kiwis holidaying at home would offset reduced revenue from international visitors, but it predicted spending in areas like Otago and the West Coast could still drop more than 40 per cent.
A recent Deloitte report said “retained spending” by Kiwis holidaying at home would offset reduced revenue from international visitors, but it predicted spending in areas like Otago and the West Coast could still drop more than 40 per cent.

* New Tourism New Zealand campaign encourages Kiwis to 'do something new'

* It's time Kiwis stopped being so stingy on holiday in their own country

Carol Walmsley visited India last year, but says she will be holidaying at home for the foreseeable future, unless coronavirus magically peters out, or until there is a vaccine for it.
Carol Walmsley visited India last year, but says she will be holidaying at home for the foreseeable future, unless coronavirus magically peters out, or until there is a vaccine for it.

* Coronavirus: Will New Zealand's most expensive attractions be forced to cut prices?

* Coronavirus: With flights grounded indefinitely, how will travel agencies survive Covid-19?

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The hope is that at least some $9 billion New Zealanders splurged on overseas trips last year will land in the pockets of struggling businesses, and Tourism New Zealand has just kicked off a campaign to get Kiwis to travel the country.

Carol Walmsley and her husband were supposed to be in the Baltic right now on a $14,000 tour of six countries.

THL has cut motorhome rates by more than 25 per cent. Chief executive Grant Webster says motorhome hierers tend to visit more regions than other rental vehicle customers, so the economic benefits are spread widely. 
THL has cut motorhome rates by more than 25 per cent. Chief executive Grant Webster says motorhome hierers tend to visit more regions than other rental vehicle customers, so the economic benefits are spread widely. 

Instead, they are planning a three-week road trip from Christchurch to the far north, and possibly a jaunt to Queenstown for some skiing. 

Former motelier Walmsley is sympathetic to the plight of “Mum and Dad tourism operators” who have suddenly found themselves with empty rooms.

Rotorua's Redwood Tree Walk is on her to-do list, but Hobbiton, which charges $89 for an adult entry ticket, is not. 

“I'm not supporting people that have [price] gouged and directed themselves at the international tourist, unless they come back and meet the market.”

Haka Tours
Haka Tours' makes a point of including cultural experiences in its packages, such as a waka trip in the Abel Tasman National Park.

Graham Bloxham is already seeing evidence of that happening, and cites an Auckland hotel offering a $99 overnight bed and breakfast package that would previously have cost $450.

Prompted by the Covid-19 crisis he set up Bundl, a website launching next month to allow consumers to build their own itineraries based on New Zealand travel package deals.

“What if it was really easy and you could delete the rental car and add a restaurant, and it was all at the right price?”

Tourism Holdings (THL) chief executive Grant Webster is not sure how attractive package deals will be for bargain-hunting Kiwis with a DIY approach to booking holidays, but THL is joining the price cutting.

The company has 3000 rental motorhomes and rather than see them sitting around unused, customers hiring Britz and Maui campers for at least three days will pay from $29 a day until the end of October. 

Bush and Beach tour guides turned to courier work as an interim measure after the borders closed. 
Bush and Beach tour guides turned to courier work as an interim measure after the borders closed. 

Webster says a week's hire that would have cost in the thousands of dollars, will be in the hundreds, and there will also be deals on insurance and one way fees. 

“There's probably no better time ever to take a motorhome holiday in New Zealand than there will be in the coming months.”

Just how long that opportunity will last depends to some extent on when we open our borders to Australians because rising demand will inevitably push prices up. 

Tourism New Zealand last week launched a campaign encouraging Kiwis to see more of their own country and experience something new. Anonymised cell phone tracking by Data Ventures showed that in the first week of alert level 2 there was a 100,000 lift in people travelling outside their local region, but only a small rise in activity in tourism areas.
Tourism New Zealand last week launched a campaign encouraging Kiwis to see more of their own country and experience something new. Anonymised cell phone tracking by Data Ventures showed that in the first week of alert level 2 there was a 100,000 lift in people travelling outside their local region, but only a small rise in activity in tourism areas.

Haka Tourism Group has gone from being New Zealand's fastest growing tourism business to looking at cutting its staff from 184 to 13 following a 90 per cent drop in revenue thanks to coronavirus.

Half its eight lodges and hotels have closed, and general manager Eve Lawrence says Kiwis aren't interested in 16 to 24 day “epic adventure tours” of their own country.

Rangitata Rafts won
Rangitata Rafts won't run trips over the coming summer because New Zealanders make only about 20 per cent of its customers.

Haka is looking at running short tours focussing on New Zealand culture and heritage — such as a one-day guided tour of Waitangi with a hangi lunch and a Te Reo lesson. 

Lawrence says our lower wages and higher living costs have bred price resistance for tourism products which actually compare very favourably with overseas equivalents. 

“We're fighting a mindset and changing a mindset is incredibly difficult.

Many aircraft used for scenic flights will be mothballed until the borders open because they are unsuitable for other work. However, some operators have dropped their prices substantially to keep staff employed, and a Milford Sound flight/cruise package that previously cost $525 is now going for $299. 
Many aircraft used for scenic flights will be mothballed until the borders open because they are unsuitable for other work. However, some operators have dropped their prices substantially to keep staff employed, and a Milford Sound flight/cruise package that previously cost $525 is now going for $299. 

“We shouldn't really be lowering our pricing but it's something we have to look at to retain or attract domestic business.”

Auckland company Bush and Beach will return to running tours after a stint using its guides and vehicles to deliver food boxes to needy families, and managing director Ben Thornton says they will slash prices to remain competitive.

A day trip to Hobbiton will drop by more than a third to $199 per person, although it will no longer include a lavish “feast” in a marquee.

Deloitte estimates a trans-Tasman bubble could generate $3b from Australians visiting New Zealand based on spending for the year to January.

Thornton is aiming his tours at people flying into Auckland for a weekend away, but he says getting the border with Australia open is absolutely key.

According Tourism New Zealand, most of the 1600 tourism businesses it surveyed believed they could adapt to a purely domestic market, and the $400 million Budget package for tourism included money to help them make the change. 

More than 30 tourism operators have already shown interest in a domestic market programme promoted by economic development agency ChristchurchNZ, but trade partnerships manager Julia Hunt says fixed costs may preclude price cutting for some businesses.

“The margins are not that massive, so there's not a lot of room for them to move and some will have to say it's not sustainable.”

Before the arrival of Covid-19, Rangitata Rafts carried up to 3500 passengers annually, mostly overseas visitors. 

It has opted to close for 12 to 18 months and general manager Darryn Hawes is considering retraining as a cabinet maker or builder. 

He says overheads, such as the $6000 bill to comply with adventure tourism regulations, make it uneconomic to rely solely on domestic custom.

The border closure also turned off the tap of overseas visitors able to afford chopper shuttles to exclusive lodges and take scenic flights to see Milford Sound or step onto a glacier. 

Aviation consultant Irene King helped prepare a submission to the Government seeking financial assistance for 40 aviation tourism companies that between them have 670 employees and more than 200 aircraft.

She says 90 per cent of the fleet is set up for high-end tourism, making it unsuitable for alternative uses, such as animal recovery or agricultural work. 

Like Thornton, King says aviation is pinning its hopes on those Aussie visitors and patronage from well heeled Kiwis who can't take regular lengthy overseas holidays.