Bali needs all 'classes' of tourists<\/p>\n
By Rob Goodfellow<\/p>\n
WOLLONGONG, Australia (JP): Bali Governor Dewa Made Berata
\nmade the very reasonable statement in November that he wanted to
\nattract more high-spending, "value-added" tourists to the island.
\nThe governor's comments were unfortunately interpreted as a
\ndirect criticism of Australia and Australians, who for nearly
\nthree decades have made up the vast bulk of package and budget
\nvisitors to Bali.<\/p>\n
The governor's perceptions also were interpreted as a singular
\nendorsement of Japanese visitors. This was because anecdotal
\nevidence suggests that as a group, the Japanese exhibit
\nparticularly generous spending patterns.<\/p>\n
Rather than concentrate on the vitriolic response of the
\nAustralian press (with headlines such as Aussies in Bali Not all
\nDrunk and Cheap), which only served to further the debate rather
\nthan resolve it, the governor's comments actually deserve a
\nscientific response. More knowledge is required about the
\nindividual consumer segments that make up the internationally
\nrecognized phenomenon we know as "Bali". For instance, are all
\nAustralian travelers the same? Are all Japanese visitors to Bali
\nbig spenders?<\/p>\n
Bali presently commands about 8 percent of the world tourist
\nmarket, valued globally at US$100 billion a year. Since the high
\npoint of the mid-1990s tourist boom, the island has unfortunately
\nbeen in slow decline as a holiday destination. This was mostly a
\nresult of the Asian economic crisis. It was also an unfortunate
\nconsequence of political instability in Jakarta and its perceived
\nimpact on Bali.<\/p>\n
At this point it is worth mentioning that when most European,
\nAmerican and Japanese holidaymakers abandoned Bali in early 1998,
\nthe Australians kept coming, albeit precisely because Bali was a
\n"budget destination".<\/p>\n
And out of interest, riots in Jakarta usually fail to rank a
\nmention in the world press, while any disturbance in Bali, no
\nmatter how relatively insignificant, is reported as
\nnewsworthy.<\/p>\n
The good news for Indonesia has been that the downward trend
\nhas recently reversed.<\/p>\n
The latest report by the Australian Bureau of Statistics (ABS)
\nshows the number of Australian visitors to Bali has risen
\ndramatically in the last three months. An examination of these
\nstatistics do, however, reveal marked differences in "types" of
\nAustralian visitors to Bali. And rather than confirm stereotypes,
\nthe following examples indicate prima facie that the market is
\nactually very complex.<\/p>\n
For example, Dr. Simon Leslie and his wife Margaret have taken
\ntheir three children -- Brendan, 16, David, 12, and Alexander, 3
\n-- to Bali twice. They stay at world-class five-star hotels, such
\nas the Intercontinental at Jimbaran Bay. This family's holiday
\nspending patterns reflect Dr. Leslie's professional income.<\/p>\n
Bill and Madge Carey have been to Bali three times. The span
\nof their visits keeps getting longer. Their first holiday was for
\n10 days, the second for two weeks and the third over three weeks.
\nThe couple will be retiring soon and plan to spend two months of
\nevery year in Bali.<\/p>\n
Bill and Madge represent a growing number of Australian
\nretirees, "baby boomers", who anecdotally plan to spend the cold
\nand windy eastern Australian winter of June to August in milder
\nclimes. This group is typically financially independent, and they
\nrepresent important business for Bali. They do not "scrimp" on
\ncomfort. They guarantee solid custom for the boutique or
\nbungalow-style accommodation market, particularly in and around
\nLegian Beach.<\/p>\n
The final group may be closer to what Governor Berata was
\nsuggesting in terms of their "shoestring" spending patterns.
\nNeville Cruckshank is 30. He is a self-confessed "budget" tourist
\nand stays in the cheapest losmen (boardinghouses).
\nNotwithstanding, he has been to Bali 10 times and will likely
\nvisit another 10 times. Visitors like Neville represent important
\nrepeat business for the bottom end of the market. The Neville
\nCruckshanks of this world may not spend a lot on a single
\nholiday, but when their frequent trips are averaged, particularly
\nover a lifetime, even the airfare component to Garuda (Neville's
\npreferred airline), not to mention the departure tax at Ngurah
\nRai Airport, becomes significant.<\/p>\n
In contrast, most Japanese workers do not have the same
\nholiday entitlements as their Australian counterparts, who
\nreceive an average of six weeks annual leave. Japanese workers on
\nthe other hand receive only two weeks holiday a year and
\ntypically "donate" one week back to their company. And unlike the
\nAustralians, they spend in short bursts. But do they come back
\nlike the Australians? What about the thousands of young Japanese
\nsurfers who visit the island every year. Are they big spenders,
\ntoo? Or are they just like Neville Cruckshank and have a budget
\nto consider?<\/p>\n
Last month the director of Australian-based IRIS Research,
\nMartin O'Shannessy, predicted a 30 percent increase in Australian
\ntourists bound for Bali. This was later confirmed by ABS. As a
\nmarket research expert, what are O'Shannessy's thoughts about
\nBali?<\/p>\n
"While Bali is a destination, it is actually one of the
\nworld's best recognized tourism brands," said O'Shannessy.<\/p>\n
"It is just like any product. When people come to Bali they
\nare purchasing a commodity. In the case of Australians there is
\nsome evidence that most of the traffic is repeat business. As
\nwith any brand, the best customer is the one you already have.
\nGaruda, for example, understands this concept well. They market
\nthe 'destination rather than the journey', because they know that
\nmost of their passengers know exactly what to expect when they
\narrive."<\/p>\n
O'Shannessy added: "The problem is that existing research does
\nnot tell us a great about the broad demographic data. At the most
\nfundamental level understanding brands is about understanding
\nconsumer patterns of behavior. In fact it is finding out who
\npeople are, what they want, and then giving them a lot of it and
\nthen getting them to pay for the added value.<\/p>\n
"The Sanur-based Bali Adventure Tours has proven this. They
\nhave been very successful in developing products that people
\nactually want. White-water rafting, the elephant safari park,
\nhelicopter rides and so on. In fact, more than this, they have
\nidentified that different market segments want different things.
\nThis brings guests back. It strengthens the relationship between
\nthe visitor and the brand. It ensures that overseas guests of
\nevery 'economic category' continue to contribute hard currency to
\nthe economy of Bali and to the whole of Indonesia year after
\nyear."<\/p>\n
The curious thing about Bali is that it appears that there is
\nvery little known about how nationalities differ from each other
\nin terms of their spending patterns there. What are their
\nexpectations? What pleases them? What brings them back? And how
\nhomogeneous are these national groups? In view of the governor's
\ncomments, and the Bali Adventure Tour experience, I could also
\nadd, what other services are guests prepared to pay more for?<\/p>\n
The general manager and director of operations for Bass Hotels
\nand Resorts Indonesia, Rolf Hubner, recently told this writer
\nthat his market mix for the Bali Intercontinental was 30 percent
\nJapanese, 25 percent Asians (including 8 percent Indonesian
\nnationals), 20 percent Europeans, 15 percent Australians and 10
\npercent Americans.<\/p>\n
The 15 percent Australian group, represented above by the
\nLeslie family, certainly deserves the attention of market
\nresearchers like O'Shannessy, but so do the medium-range and
\nbudget travelers.<\/p>\n
Two decades ago government planners in Denpasar decided that
\nKuta was to be developed as a budget destination, Nusa Dua
\nreserved for mass, medium-range package holidays and Jimbaran,
\nSanur and Ubud "quarantined" as a retreat for more upmarket
\nvisitors. I believe that it is time to further develop this
\ninclusive strategy and better understand how the Bali tourism
\nmarket actually operates. This can only be done by scientifically
\nmeasuring sentiment, accommodation preferences, spending
\npatterns, satisfaction indexes and so on.<\/p>\n
Further, we need to appreciate that elite, mid-range and
\nbudget holidaymakers each have an important role to play in
\nensuring the long-term viability of Bali as one of the greatest
\nplaces on the planet for anyone to go on holiday.<\/p>\n
Rob Goodfellow, a writer and Indonesian cultural consultant to
\ninternational businesses, is based at the University of
\nWollongong. He can be contacted at sujoko@ozemail.com.au.<\/p>",
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