Rush of summer bookings won’t fill $3 billion gaping hole in tourism spend
From the Far North to the Deep South, New Zealanders are going to experience our own backyard in unprecedented numbers over the Christmas break thanks to Covid travel restrictions. But how long will the domestic tourism sugar hit last?
With many Kiwi travellers finding their wings unexpectedly clipped due to border restrictions, some centres are set for a bumper holiday season as “staycation” numbers surge.
But a rush of summer holiday bookings won’t fill the gaping hole in New Zealand’s tourism industry, an expert warns.
Even if Kiwis holiday hard-out at home this summer, the tourism industry is still looking down the barrel of a $3 billion drop in spending.
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Tourism New Zealand chief executive Stephen England-Hall says Kiwis simply cannot make up for the lack of bigger-spending overseas visitors.
He points out it takes 480 overnight trips by domestic visitors to generate the same spend as 40 overseas tourists, and every $178,000 in spending creates one job.
Regional New Zealand could be in for a bumper summer as Kiwis flock to campgrounds.
In recent years the tourism season has stretched to well outside the summer months, with many overseas visitors coming from October to the end of March.
Over that six-month period last year, 1.3m Kiwis splashed out $4.4b on holidaying overseas.
“All 1.3m of them would need to spend $2000 more each in New Zealand than they would have spent overseas,” says England-Hall, “which is not going to happen”.
“Even if we perform some miracles that gap will still be there.”
Some larger centres could bear the brunt as Kiwis shun city breaks in favour of more basic getaways.
The adrenaline capital of New Zealand, Queenstown, has a population of about 40,000. At peak that can almost triple to 110,000.
More than 60 per cent of the three million annual visitors to the alpine town were from overseas, according to Tourism NZ.
Destination Queenstown chief executive Ann Lockhart says there is optimism in the alpine town, despite the impacts of Covid-19.
Compare that with the likes of Taranaki, where the tourism spend is much lower ($380m in the year to August 2020), but an estimated 80 per cent comes from domestic visitors.
With the torrent of international tourists stemmed for the foreseeable future, Queenstown is hoping to boost the number of Kiwis coming in over summer and beyond.
Destination Queenstown this week began a 10-week advertising blitz aimed at winning over Kiwis more inclined to head to the beach for a break.
Despite branding itself as the “Home of Adventure” in a series of advertisements, Destination Queenstown chief executive Ann Lockhart says the resort town has more to offer than adrenaline-packed outdoor adventures.
And while she concedes domestic visitors won’t be able to fill the large gap, especially over summer, Lockhart says there is optimism in Queenstown.
“We’ve had a bit of an uplift with school holidays [in September] and with this campaign behind us or backing us we expect to see visitors return to us in summer.”
Queenstown’s population of 40,000 could swell to 110,000 at peak times pre-Covid.
While the thought of smaller crowds in places like Queenstown and Auckland may entice some domestic visitors, many Kiwis have more humble holiday tastes.
Shaun Fitzmaurice, spokesman for holiday home website Bachcare, says Christmas booking rates are already well ahead year-on-year in regions within reasonable travel distances of major cities.
Nights booked in some parts of the Coromandel are 28 per cent up year-on-year, while Tauranga is up 23 per cent, Hawke’s Bay up 64 per cent and Nelson/Golden Bay up 32 per cent.
“Some areas are quieter due to the lack of international traffic and lots of accommodation options, such as Queenstown, but we expect some later bookings for those regions,” he says.
After a wave of cancellations when New Zealand first went into coronavirus lockdown in March, Bachcare has seen a resurgence in bookings, particularly around long weekends and school holidays, Fitzmaurice says.
As of Thursday, bookings for Labour Weekend were up 46 per cent up on last year.
And it’s not just baches that people are flocking to, campgrounds are also doing a roaring trade.
Holiday Parks New Zealand (HPNZ) chief executive Fergus Brown says those parks are bucking the trend seen across many other types of accommodation like hotels, motels and even backpackers.
Data shows holiday parks recorded 358,700 guest nights in August, an 11.1 per cent or 35,700 increase on August 2019.
In comparison, hotel guest nights fell 47.2 per cent, motels were down 30.9 per cent and backpackers slumped 53.4 per cent.
Many campgrounds around the country are booked solid over Christmas and into January.
Parks up and down the country report being inundated with reservations after opening summer holiday bookings.
Many are now booked solid over Christmas and into January.
Brown says holiday parks offer accommodation at a competitive price and guests can also feel good about supporting local businesses and jobs at the same time.
“If we can return a portion of what we would usually spend internationally to our local businesses this year, we’ll all be in a far better position coming out of the crisis.”
The picture is far bleaker at the other end of the accommodation scale, Hotel Owners Association executive director Amy Robens says.
While Queenstown and the Bay of Islands are seeing some traction, summer for many hotels is looking “abysmal”.
“Many hotels are struggling, particularly in the likes of Auckland and on the West Coast, in what is a very flat market.
Amy Robens, executive director of the NZ Hotel Owners Association, says summer is looking “abysmal” for many hoteliers.
“The summer trade is traditionally generally made up of high-yielding international visitors. We also hold a lot of conferences over the summer months and those just aren’t happening.”
Robens says any increase in domestic visitors would help, but there are some “massive holes” in hotel occupancy that Kiwis can’t fill.
“We’re doing all we can with pricing and presenting the best packages we can to entice people to our regions.
“But with domestic airfares increasing to offset the loss of international visitors, that’s a real stumbling block for Kiwis who are struggling. It’s not surprising that people are hesitant and leaving it to the last minute, if they commit at all.”
Robens says there will be little relief for hotel operators until a two-way travel bubble with Australia is established.
“There’s a lot of pent-up demand and it’s really disappointing that a solution can’t be found to safely open the border with Australia.
“The Government needs to work harder, so we can put systems and practices in place to make that happen.”
According to Tourism NZ, if trans-Tasman borders were to open by a “pragmatic estimate” of January 2021, Australian visitors could contribute $1 billion to the economy by September 2021.
In the meantime, capturing the $9b a year Kiwis spent on overseas travel pre-Covid will be critical to the sector’s recovery, England-Hall says.
“It’s crucial that tourism also provides lasting benefits to our communities and enriches New Zealand. Every time someone heads into a new region, they don’t just visit tourist attractions.
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“They shop at local retailers, book hotel rooms, eat at restaurants supporting employment and community growth.”
There are already some positive signs, with the organisation’s latest research finding 71 per cent of Kiwis are planning a domestic getaway within the next 12 months, up from 64 per cent in May.
“We think they probably thought they weren’t going to [holiday in NZ] because by Christmas they’d be able to go overseas, and now it’s becoming apparent that’s highly unlikely, and they’re going ‘maybe we’re going to hang out in Milford instead’,” England-Hall says.
Perceptions of a New Zealand holiday are also on the rise, with those who rate it as “excellent” or “good” increasing to 62 per cent, up 14 per cent from the May survey.
“Now more than ever we appreciate what a fantastic place New Zealand is,” England-Hall says.
“As Kiwis start exploring more of New Zealand, their opinions of what’s on offer have improved.”
And while a post-Christmas slump is all but inevitable, Kiwis’ changing holiday habits could help cushion the blow.
Many are turning to short getaways, heading out of town for weekends rather than opting for longer stays, with an increased proportion taking those breaks over public and school holidays.
The North Canterbury resort of Hanmer Springs is a beneficiary of that behaviour pattern.
Hanmer Springs thermal resort manager Graeme Abbot says more North Islanders are visiting and staying three or four nights instead of 1.5 on average.
“I was taking to an Aucklander and she and her family had flown from Auckland and come to Hanmer for three nights.
“They were doing a number of short breaks around New Zealand, and they were going home and then doing the same thing to Queenstown.”
Paihia Top 10 Holiday Park’s picturesque location in the Bay of Islands sees it booked out for Christmas every year.
Since New Zealand’s level 4 lockdown, Paihia Top 10 Holiday Park’s cabin and camping site has been as full, or more full, than an ordinary year.
“Kiwis have filled the void of international tourists to date, and they’ve done a fantastic job of travelling around and getting to know their own country,” owner Dusty Miller said.
But it’s not all plain sailing. “Certainly March  I think is going to be difficult, but I’ve not been right about anything yet,” Miller said.
Paihia beach, Bay of Islands.
“There is no model. We’re just having to put one foot in front of the other and hope like hell it’s alright.”
The planning is also difficult at Poor Knights dive operation Dive! Tutukaka.
Domestic tourists have made the operation more busy during weekends and school holidays, but weekdays and the shoulder seasons are a worry, operator Jeroen Jongejans said.
“Over Christmas, we will all be very busy – which is great – but afterwards we will have to look at the lack of internationals and the staffing issues.”
Jongejans is also worried about what will happen when the borders open to the Pacific, giving Kiwis more alternatives to coming north. – Denise Piper
Matt Jones Wildlife Images/Stuff
Travellers preparing to leave Stewart Island, for Invercargill, on Thursday morning.
It may not be the most obvious summer holiday spot, but Kiwi holidaymakers are targeting Stewart Island as a Christmas and New Year destination.
The South Sea Hotel and Stewart Island Backpackers are booked out from December 26 and into January, with the latter’s 28 rooms chock-full this Labour Weekend.
Receptionist Liz Phair said the hotel, which can accommodate 50 people, was also heavily booked to November 8.
A lot of North Islanders were visiting because they had not been to Stewart Island before.
She added five tour groups with up to 20 people in each, had booked accommodation within a two-week period during the summer holidays.
Reservations had been increasing in recent weeks, too.
Passenger numbers on Stewart Island Flights had built up quickly since the lockdown and bookings were looking “extremely good” for the holidays, chief executive and chief pilot Raymond Hector said.
Before the Covid-19 pandemic struck, 60 per cent of its passengers were domestic travellers, with the remaining 40 per cent overseas.
“Whether the domestic market can fill the 40 per cent void [during the holidays], I don’t know,” Hector said. – Jamie Searle
The Tui Brewery north of Pahitaua has become a popular destination.
Nick Rogers’ company, The Experience Collective, runs the visitor experience at the Tui Brewery in Mangatainoka – east of Palmerston North.
Rogers calls the brewery, on State Highway 2 on the Wellington to Hawke’s Bay wine and beer trail, a Kiwi icon.
The business weathered the Covid restrictions well, with site tours and functions remaining popular.
Even with stepping back to a five-day week it’s been as busy, or busier, than last year and bookings for the Christmas and New Year holidays were already filling up, he said.
Christmas lunch events within a week of the holiday itself were booked out with business parties of 120-140 people, much earlier than usual this time around.
Rogers believed the boom was because more Kiwis were visiting places in New Zealand they’d always wanted to see, replacing planned overseas trips after international travel was all but shut down.
“What was our biggest weakness, has become our biggest strength.” he said.
“We’ve been trying to attract more international visitors for years, but the brewery isn’t as well-known or iconic for them.” – Paul Mitchell
Hahei Holiday Resort general manager Grant Kilby.
Hahei Holiday Resort on the Coromandel Peninsula is 100 per cent booked from Christmas Day until early January 2021.
General manager Grant Kilby told Stuff that the resort has been “inundated” with reservation requests since summer holiday bookings opened in July.
The resort even gives “criteria status” to guests who have stayed in the same accommodation over the same date range for more than five consecutive years.
The status may be passed onto an immediate family member, resulting in generations of families going back to the resort each year.
“These customers have the privilege of being awarded criteria status, which affords preferential booking for the same site/accommodation each peak season before we open bookings to the public,” Kilby said.
“We opened booking deposits almost immediately after peak season, and they all are returning.”
One family will be celebrating their 51st consecutive year at the resort this summer.
“There’s nothing positive about Covid, but the result of the domestic market being border-bound to a greater extent has resulted in a wave of new business and new customers,” he said.
“I expect the coming year will be one to set in play the return of the weekend family getaway, which has been lacking in past years.”
“The hassle of getting in and out of airports, the cost, and the potential international risk of Covid contraction will see the bulk of Kiwi’s opting for a New Zealand stay.” – Kelley Tantau
Lift Off Abel Tasman
Kaiteriteri from Stephens Bay Walk.
At the top of the South Island David Ross, chief executive of the Kaiteriteri Recreation Reserve north of Nelson, said there were no sleepless nights over the upcoming summer holiday period.
“We are at capacity, we are fully booked,” he said.
He thought the post-lockdown surge would have died down, but the reserve has maintained a steady stream of visitors ever since.
About 75 per cent of their December holiday bookings are domestic visitors in any given year, with the bulk normally Cantabrians, but more people are flocking from all over New Zealand to spend their holiday at the reserve.
A pair of oystercatchers strut along Kaiteriteri Beach.
He said he wasn’t sure how long the domestic bubble surge would last.
“How long that would last for I am not sure.“Clearly if people can’t go [overseas], they are always going to want to holiday somewhere. Given the variability of our operation – we have the reserve, the beach, the Kaiteriteri mountain bike park – we are quite unique in what we do in that we are actually a destination in itself as opposed to being just an accommodation operator. That is a huge part of the demand at the moment.” – Mariné Lourens
Anakiwa, at the start of the Queen Charlotte Track.
Normally a track swamped with international visitors, the Queen Charlotte Track, in the Marlborough Sounds, had seen a surge in Kiwi visitors, track chairman Rob Burn said.
The 72km track, from Ship Cove to Anakiwa takes about three to five days, with high-end lodge and resort accommodation or DOC campsites.
“I expect that a lot of people will come and walk the track, and I’m hoping that it’s going to be good for all of us, it gives some hope for the tourism industry in our area.”
Resolution Bay Cabins co-owner Anne Sowman said their Christmas period was always booked out with returning visitors.
They could cater for up to 40 people across their baches and trappers hut, which was near the end of the Queen Charlotte Sound.
While domestic business was doing well Sowman assumed this summer would be quieter and had, naturally, noticed a drop in Australian bookings.
Kiwis were making up for it, to an extent.
“It surprises me in some ways, but also it doesn’t because Kiwis are outdoor people and they can’t travel overseas. People are choosing to have a look around New Zealand which is really, really good.” – Maia Hart
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