TNQ’s falling market share getting some much needed attention

As regular readers will be aware, we have been highlighting TNQ’s declining share of the tourism market for many years so it’s encouraging to see the issue (finally) being addressed head-on by the region’s main tourism marketing arm, TTNQ.

Over the past seven years TNQ’s share of Australia’s total tourism expenditure (international and all domestic) has fallen from about 3.2% to just 3.0% today. While that may not seem like much of a decline it translates to a total of a lost $260 million spent in the region in the past year (TNQ’s total for the year to Sept 2019 was $4.1bn).

The story is far worse when we consider just international tourism where the region’s share of visitors has fallen from a high of over 17% fourteen years ago to less than 10% today. The reason TNQ has not done so badly in total has been the powerful performance of the domestic market which now accounts for 75% of all tourism expenditure in the region.

It’s worth noting that when TTNQ originally set their target for expenditure of $4.1bn by 2020 (this target has been hit early) they envisaged the internationl/domestic split to be about 49:51 rather than the 25:75 they have ended up with. TTNQ’s 2015-20 Strategic Plan had forecast international expenditure growth at just under 15% per year; the reality over the past five years has been an annual average just under 5%; in the past 2 years we have seen average declines of 0.6% pa. Domestic expenditures were forecast to grow at just under 3% per annum; the reality has been an increase averaging almost 8%.

Stories in today’s Cairns Post talking about the need for a $10 million boost to marketing for the region and an acknowledgment from the new TTNQ CEO, Mark Olsen, that the “market keeps evolving at a faster rate than ever before, so we need to keep evolving at a faster rate just to maintain our market share.” are welcome signs that this issue might finally be getting the attention it’s deserved for so long.

Mark is also quoted as saying that up to 60% of the region’s Chinese tourism could be at threat from cancellations related to the coronavirus outbreak. China accounts for about 25% of all international visitors to TNQ so a drop of 60% in that market would have severe consequences. This kind of decline in Chinese numbers could wipe out about 15% of the region’s total $1.1bn internationl tourism spend ($162 million), although we would hope that the impacts are limited in time.

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