Tourism operators wondering how the 2008 season may be shaping up may have seen the reports below from the CBC and The Canadian Press.
The reports show that the March 2008 figures for foreign visitors to Canada are 12.4% lower than a year ago.
While visitors from the US make up a large proportion of this decline, there are declining numbers from Germany, but gains from Italy and the Netherlands. The number of overseas visits to Canada fell by 3 per cent in March 2008 to 384,000.
With one in ten jobs related to the tourism sector in Canada, the tourism figures are beginning to make national headlines. Operators, on the other hand, have experienced the challenges of doing business in an ever increasingly competitive market ever since 9/11.
“Tourist spotting,” rather like bird spotting, has been a local phenomenon in small coastal communities, like Canso in Nova Scotia, for some time. This sport is now apparently becoming a national phenomenon as gas prices and our exchange rate relative to European currencies and to the US dollar have changed foreign visitors’ perception of their purchasing power.
After SARS, Toronto’s tourism sector was decimated. With that hardened 20-20 vision of the SARS experience, Toronto has re-emerged as an industry leader in the tourism sector, positioning itself at the luxury end of the spectrum and being unabashed that their hotel rates now have the eighth highest ADR (average daily rate) worldwide.
In Nova Scotia, our learning curve may be a little flatter. Operators are confronted with the anomaly of having to position themselves between two much more divergent markets than Toronto experiences, the domestic and the foreign.
Despite the tourism research findings that pricing is apparently the fifth or sixth consideration in selecting a tourism destination, experienced market researchers in other industries make allowances for the mismatch between what consumers say they do and what they actually do.
So although people may answer a questionnaire with answers that indicate that a number of other factors are more important than price, when it actually comes to making their reservations, price may suddenly take a flying leap towards the top of the list.
This discrepancy is much more likely to have a direct impact on the domestic than on the foreign market: the domestic market is essentially a fixed entity while the foreign market comprises a constantly changing profile of various countries depending on their relative economic success in any given year.
The domestic market may just turn out to be a whole lot more price sensitive than we have been led to believe it is, just at a time when the tourism marketing mantra is “go luxury, go niche.’
The “propensity to spend,” issue is also a little more nuanced. While the propensity to spend may depend more on the visitor’s experiential rating than on the visitor’s gross income, it does assume that you have already managed to lure the visitor to your destination.
Referenced articles:
CBC - The number of foreign visitors to Canada in March was the lowest since record-keeping began in 1972, Statistics Canada said Tuesday.
About 2.26 million visits to this country were recorded that month, down 12.6 per cent from the same month a year earlier.
A big drop in American visitors was behind the decline. Only 730,000 same-day car trips were made by U.S. motorists in March. That was down 2.5 per cent from the month before and a 24 per cent plunge from a year ago as the price of gas, a high Canadian dollar and a weak U.S. economy kept Americans close to home.
The number of overseas visits fell by 3 per cent to 384,000.
“Travel declined in eight of Canada’s top 12 overseas markets, with the strongest decreases in travel from Mexico, Germany and Hong Kong,” said Statistics Canada.
Canadians, on the other hand, were showing no reluctance to travel, as the number of out-of-country trips rose in every category.
Canadians made 2.1 million same-day car trips to the U.S. in March, up 1.5 per cent from February and an increase of 9.5 per cent from year-ago levels.
The total number of trips to the U.S. rose to 3.8 million.
”The level of Canadian travel to the United States observed in the past six months has been the highest since 1998,” Statistics Canada reported.
Overnight plane trips to the U.S. hit a new record high for the fourth month in a row.
Travel by Canadians to countries other than the U.S. also hit a record high
The Canadian Press - OTTAWA - Travel to Canada hit a record low for the fifth straight month in March, following big declines in both same-day car trips from the United States and the number of visitors from overseas nations.
Statistics Canada reports foreign visitors made 2.3 million trips to Canada in March, the lowest since record keeping started in 1972.
That’s a one per cent decline from February, and a 12.4 per cent drop from a year earlier.
Meanwhile, the number of Canadian trips abroad rose 1.4 per cent to almost 4.5 million, the vast majority (85 per cent) to the United States.
U.S. residents made only 730,000 same-day car trips to Canada in March, down 2.5 per cent from the previous month.
Same-day car travel to Canada has fallen by 41.1 per cent in two years.
Overseas travellers to Canada made 384,000 trips in March, down three per cent.
Travel declined in eight of Canada’s top 12 overseas markets, with the strongest decreases in travel from Mexico, Germany and Hong Kong.
There were gains in visitors from India, Italy and the Netherlands.
Overall, Canadians made 3.8 million trips to the United States in March, up 1.6 per cent from February. Canadian travel to the United States in the past six months has been the highest since 1998.
Same-day car travel to the United States increased 1.5 per cent to 2.1 million trips, while overnight car travel rose 1.9 per cent to 991,000 trips.
Overnight plane trips to the United States set a new record high for the fourth straight month.
Canadian travel to countries other than the United States increased 0.4 per cent to a record 670,000 - the 10th month in the past year in which a new record high was set.