confidential copyright © 2004 south african tourism— confidentialknysna febraury 2005 1
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Confidential
Copyright © 2004 South African Tourism— Confidential Knysna Febraury 2005 1
South African Tourism
PORTFOLI O COMMI TTEE
11 October 2005
GEARING
SOUTH AFRICA
TO BE GLOBALLY
COMPETITIVE
Achievement Summary
• 47.8 billion TFDS as opposed to 15 billion Gold• R1,532 Average Spend• 93.6 billion – 7.4% GDP• 539,017 Direct Employmment• 9 nights average length of stay• 2 provinces visited per traveller• 101 million BEE spend• Comply with employment equity• 47 billion in domestic travel• Unqualified audit• Its possible brand launch• Shot’ left domestic campaign• Continue to comply with employment equity – 77.4%
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Copyright © 2004 South African Tourism— Confidential Knysna Febraury 2005 3
Overview to 2004
In the past 10 years, since our first democratic election in 1994, foreign tourist* arrivals to South Africa have grown by more than 3 million arrivals. After a slow start in 2004, the third and fourth quarters registered the highest arrivals for that quarter in our history. The continued growth of foreign tourism arrivals is the reason why tourism is called the ‘new gold’ of the South African economy for its job creation and contribution to the gross domestic product of our country.
The Tourism Growth Strategy outlines core and investment markets in different regional portfolios, so flexibility is built into the model and the risk is spread across markets in order to maximise our return on investment in one of the most fast changing and globally competitive industries in the world. The strategy has paid off in 2004 as the growth in all other regions has exceeded the losses out of two of the European markets (France and Germany) and Mozambique with a healthy growth out of Africa, the Americas and Asia.
Note: The full 2004 Annual Report is available on www.southafrica.net/research
* Foreign tourist arrivals as defined by the World Tourism Organisation of a ‘tourist’
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0
1
2
3
4
5
6
7
8
1965
1967
1969
1971
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
State of Emergency
Foreign Tourist Arrivals to South Africa, 1965-2004
*based on opinion of participants interviewed, anecdotal evidenceSource: StatsSA
Arr
ival
s, m
illio
ns
First Democratic Elections
Nelson Mandela released
Sanctions against South Africa lifted
1970s and 80s - Stagnation Stagnation drove low investment, focus on narrow white
domestic market and costs
1990-1998 - Growth Initial period of short-term
profit-taking followed by period of investment growth and entry of foreign players
1998 onwards - Cyclicality Global events, currency volatility
drive uncertainty and short-term strategy by firms
Investment rates remain weak overall
Sanctions Era
6.7 million arrivals
South Africa has gone through a rapid period of growth and in 2004 we are
holding the gains we have made
RugbyWorld Cup
9/11
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Total arrivals to South Africa reached a record high of 6.7million in 2004
5,787,370
6,677,8396,504,890
6,429,5835,890,514
5,731,424
4,944,430
4,488,272
3,668,956
5,872,254
5,140,124
1,500,000
2,500,000
3,500,000
4,500,000
5,500,000
6,500,000
7,500,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Foreign Tourist Arrivals to South Africa (1998 - 2004)
Source: SAT Arrival Statistics, 2004
CAGR:
1994 – 2004: 6.2%
1994 – 1998: 11.8%
1998 – 2001: 0.3%
1998 – 2004: 2.6%
2001 – 2004: 4.9%
Overall arrivals grew by 172,954 from 2003 to 2004. ‘Overseas’ arrivals increased by 0.3%, (5,226) while Africa grew by 4,2 % (188,821): the difference was a decline in both unspecified and Indian Ocean Islands
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In 2004 there was an overall growth of 2.7% over 2003
Total arrivals for 2004
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
2003 6,504,890 4,485,064 262,496 265,628 1,319,172
2004 6,677,839 4,673,724 290,625 275,001 1,287,057
Difference 172,949 188,660 28,129 9,373 -32,115
% change 2.66% 4.21% 10.72% 3.53% -2.43%
Total Africa & Middle East Americas Asia & Australasia Europe (incl UK)
Arr
iva
ls (
tho
usa
nd
s)
Source: SAT Arrival Statistics, 2004
There was growth of foreign tourism arrivals across all the regional portfolios except Europe
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Year on year arrivals – Africa: 4.2% up
Arrivals from Africa January to December
0
50
100
150
200
2003 28,872 20,243 38,082 31,814 30,866 197,626
2004 28,543 17,727 40,422 31,653 31,752 203,368
Difference -329 -2,516 2,340 -161 886 5,742
% change -1.14% -12.43% 6.14% -0.50% 2.87% 2.90%
AngolaIndian Ocean
IslandsKenya, Tanzania,
UgandaMiddle East Nigeria, Ghana SADC Air
Arr
iva
ls (
tho
usa
nds)
Source: SAT Arrival Statistics, 2004
The increase in Africa were driven largely by SADC (both air and especially land – this is despite a 65,000 decline out of Mozambique) and East and West Africa
Arrivals from Africa January to December
0
1,000
2,000
3,000
4,000
5,000
2003 4,156,965
2004 4,291,512
Difference 134,547
% change 3.20%
SADC Land
Arr
iva
ls (
tho
usa
nds)
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Year on year arrivals – the Americas: 10.7% up
Arrivals from the Americas January to December
0
50
100
150
200
250
2003 17,452 34,692 187,447 22,905
2004 21,137 37,170 208,159 24,159
Difference 3,685 2,478 20,712 1,254
% change 21.12% 7.14% 11.05% 5.47%
Brazil Canada USA Other Americas
Arr
iva
ls (
tho
usa
nd
s)
Source: SAT Arrival Statistics, 2004
The growth out of the Americas was driven by the third year of growth out of the United States, where we have also seen the greatest decline in seasonality (see slide 22)
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Year on year arrivals – Asia & Australasia: up 3.5%
Arrivals from Asia & Australasia January to December
0
50
100
150
2003 71,687 42,822 41,018 21,311 80,532
2004 75,675 51,080 36,172 23,091 97,241
Difference 3,988 8,258 -4,846 1,780 16,709
% change 5.56% 19.28% -11.81% 8.35% 20.75%
Australia China India JapanOther Asia & Australasia
Arr
iva
ls (
tho
usa
nd
s)
Source: SAT Arrival Statistics, 2004
There was growth across Asia. The decrease in India is the effect of the Cricket World Cup in 2003 when more than 5,000 Indians came out for the finals
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Year on year arrivals – Europe: down 2.4%
Arrivals from Europe January to December
0
100
200
300
400
500
2003 127,760 257,018 49,818 120,933 456,468 307,175
2004 109,276 245,452 50,429 120,838 456,368 304,694
Difference -18,484 -11,566 611 -95 -100 -2,481
% change -14.47% -4.50% 1.23% -0.08% -0.02% -0.81%
France Germany Italy Netherlands UKOther
Europe
Arr
iva
ls (
tho
usa
nd
s)
Source: SAT Arrival Statistics, 2004
The loses out of were driven by France and the Germany. Arrivals out of the UK and Netherlands improved in the second half of the year reporting in flat results in 2004: Interestingly we gained market share in France (slide 32) while we lost significantly in Netherlands and Germany.
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Total international trips 2004 vs 2003
714691
760
0
100
200
300
400
500
600
700
800
2002 2003 2004
mill
ion
s
Global tourism grew by about 69 million trips (10%) in 2004
International tourist arrivals 2004
402
119 112
28 31
414
153124
35 33
0
50
100
150
200
250
300
350
400
450
Europe Asia/Pac Americas ME Africa
mil
lio
ns
• Europe remains the world’s #1 tourism region. France remains the top destination
• Arrivals to Europe grew at 3% over 2003
• Growth in global arrivals was driven off growth in
• Asia 2.9% (which has now in 2nd place having overtaken Americas) driven by huge regional travel
• Americas 11%
Growth in global tourism:
• 2002 to 2003: -3.2%
• 2002 to 2004: 3.2%
• 2003 to 2004: 10%
Source: World Tourism Barometer January 2005 – WTO; The World Market for Travel & Tourism – Euromonitor 2005
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5,731
5,891 5,872
5,787
6,430
6,505
5,200
5,400
5,600
5,800
6,000
6,200
6,400
6,600
1998 1999 2000 2001 2002 2003
4,167
4,460
4,931
4,856 4,841
4,746
3,600
3,800
4,000
4,200
4,400
4,600
4,800
5,000
1998 1999 2000 2001 2002 2003
South Africa has been growing in a period where our largest competitor
(Australia) has been losing ground until 2004
Tourist Arrivals to Australia, 1998-2003
Num
ber
of T
ouris
ts, 0
00s
Source: SAT Arrival Statistics, Oct 2002; ATC
Num
ber
of T
ouris
ts, 0
00s
Tourist Arrivals to South Africa, 1998-2003
CAGR98-03 = 2.6%
CAGR98-03 = 2.6%
Growth Rate, CAGR
98-01 = 5.2% 01-03 = 6.0 %
01-03 = 6.0 %
98-01 = 0.3%01-03 =
-1.1%
01-03 =
-1.1%
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60
100
140
1998 1999 2000 2001 2002
Agro-processing
Chemicals
Automotives
Clothing
Metals
Machinery
Tourism
GDP Contribution per Sector (Indexed*), 1998-2002CAGR
(1998-2002)
5.0%
-1.1%
5.2%
3.7%
1.2%
* All numbers indexed to 100 for the year 1998; ** Calculated numberSource: DTI; Quantec, 2004; SAT; Monitor Analysis
8.9%
Con
trib
utio
n to
GD
P (
inde
xed)
GDP Contribution in 2002
R11,1bn
R2,8bn
R14,3bn
R7,1bn
R72,3bn**
R27,8bn
R14,7bn
The tourism sector’s GDP growth rate is in the top 4 but is the highest
absolute contributor in the SA economy
4.1%
The tourism GDP figures have been modeled using WTO figures, foreign direct spend in South Africa, Domestic spend and spend by South Africans in other countries
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Copyright © 2004 South African Tourism— Confidential Knysna Febraury 2005 23
-3%
-2%
-1%
0%
1%
2%
-5% 0% 5% 10%
Internally, the tourism sector is the only priority1 sector showing positive
growth in employment and GDP, however transformation levels are poor
Note: 1 Priority sectors as identified by Cabinet, CAGR applied to each sector for period 1998-2002, Tourism GDP values are estimatesSource: DTI; Quantec, 2004; SAT; Monitor Analysis, GCP Phase 1 2004
Growth in Employment vs. Growth in GDP Contribution (1998-2002)
Employment (CAGR:98-02)
Contribution to GDP (CAGR: 98-02)
Clothing
Agro Processing
Machinery
Chemicals
Metals
Automotives
Negative growth
Positive growth
Positive growth
Negative growth
Tourism
On an Internal BasisTourism is performing well
relative to the other priority sectors and is creating jobs and value
However, transformation of the tourism levels in the industry are poor
On an Internal BasisTourism is performing well
relative to the other priority sectors and is creating jobs and value
However, transformation of the tourism levels in the industry are poor
Campaign Evaluation
October 2005
Executive Summary
• Sho’t Left was the first campaign designed to boost the growth of domestic tourism in South Africa as a direct result of the Domestic Tourism Growth Strategy unveiled at Indaba 2004.
• The campaign was run from Mid June to the end of September 2005.
• At the heart of the campaign was a TV insert series run on the national broadcaster in prime time highlighting things to see and do around the country
• In support of the TV programme and to ensure conversion to action, this campaign employed all media options and leveraged every opportunity to market the notion of “taking a Sho’t Left” to the public.
Domestic Portfolio 2005-6
Sho’t Left overview
• Key Objective:– To get more people to take more short
trips more often• Key Target Market:
– Emerging domestic traveller • Key Message:
– Domestic travel is affordable and do-able
TV programme58% Reach achieved of
Emerging market
Radio Campaign 79% reach of
Emerging market
TV promos Reach of 512 AR’s
90 Taxis1.8 million
Impacts250000 passengers
Billboards
Viral email& Posters
Estimated reachOf 100,000employees
Print AdsDaily Sun & Sunday Sun
45% reach of Emerging market
Domestic Portfolio 2005-6
Unleash the possibilities of taking
more short breaks, more often
Extension CampaignPR Coverage
EventsRoad Show to large
Employers, universities& shopping centres
Reality Game Show
13 epsSABC 2
Conversion Campaign
Tour OperatorsWeb-site
Call centreTravel Agents
GSA’s
Advertising Campaign
TV Ads & promos (SABC1,2,3 and e)Radio (Metro, Ukhozi and Yfm)
Print (Daily Sun)Internet banners & SMS messaging
Rank TV & Stokvel TVPackage brochure
Sho’t Left
Domestic Portfolio 2005-6
Sho’t Left TV Show
The Sho’t Left Chalenj!
Hosted by Desmond Dube
Domestic Portfolio 2005-6
BEE GSA Pilot Programme
• We hope to pilot a sales programme with Sho’t Left • This is detailed under the “New Channel” strategy• We will look at two agents, recruited and trained to sell
the Sho’t Left packages at large employers and trade unions.
• They will be paid a contract salary for three months and provided with a list of prospects (large employers, trade unions and universities)
• A presentation, posters and Sho’t Left brochures, a business card and uniform to support them in the sales process.
• This is not an advertising, PR or branding function, and we will therefore recommend bringing in a specialist organisation to assist us with this aspect of implementation
• This pilot will be used as a basis for developing a full business plan around the development of a GSA force for the domestic market
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National Tourism Conference – Johannesburg 2004Phase 1 GCP 2004 Monitor Group and South African Tourism © 34
Size of Target Market in the 9 markets
67,940,000
Size of Target Segments (we are currently
focusing on) in the 9 focus markets
24,798,300
We know the sizing the opportunity in a group of markets we focus on –
China, Japan, India, US, UK, Germany, France, Kenya and Nigeria
For the markets we have studied in depth – the opportunity is massive
Current Arrivals from 9 key Markets
1,208,929
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The number of tourists producing these outcomes are only a small fraction
of the market potential
2003 ArrivalsFirst timer
holidaymakers in 2003Target market Opportunity
SA's penetration into targeted
markets
Kenya 17,743 1,826 400,000 4.4%
Nigeria 22,645 5,129 1,000,000 2.3%
USA 187,447 71,460 10,400,000 1.8%
Australia 71,687 28,583 3,000,000 2.4%
France 127,760 78,078 9,300,000 1.4%
Germany 257,018 118,562 14,600,000 1.9%
Netherlands 120,933 59,139 1,300,000 9.3%
UK 456,468 199,453 9,200,000 4.5%
Source: Branding Tracking results-2004, SAT Departure Surveys 2003, StatsTool 2003
South Africa’s percentage market share of certain key market show how little of South Africa’s potential is actually being utilized
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Global CompetitorsGlobal Competitors
Domestic DemandDomestic Demand
National GoalsNational Goals
Competing Competing OperatorsOperators
Competing Competing OperatorsOperators
Supporting Supporting IndustriesIndustries
Supporting Supporting IndustriesIndustries
Consumer GoalsConsumer Goals
Strategic ContextStrategic ContextStrategic ContextStrategic Context
GlobalDemandGlobal
Demand
Competing Product Competing Product OwnersOwners
Competing Product Competing Product OwnersOwners
Becoming a global player is about an internal dialogue on how we move
forward as a destination to make sure that we are more competitive
It is built on a shared vision of the future and an understanding of where we work together and where we compete in a transparent way
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National Tourism Conference – Johannesburg 2004Phase 1 GCP 2004 Monitor Group and South African Tourism © 37
Enhancing competitiveness is ultimately about enhancing firm-level
decisions
Goals and
Vision for the
Tourism Sector
(Already Decided)
Government has certain desires for the
tourism industry based on a national
context Outcomes of firm
level choices
(over time) will create
or destroy - jobs and
value
Government’s success is measured by the outcomes of firm level choices
The question is: How does Government intervene in an industry if it wants to enhance competitiveness and therefore create jobs and grow
GDP?
The question is: How does Government intervene in an industry if it wants to enhance competitiveness and therefore create jobs and grow
GDP?
We need a framework for understanding what actions can be taken that will have a positive impact on firm level decisions. This means understanding the decision making process and its inputs.
Source: Monitor Group
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National Tourism Conference – Johannesburg 2004Phase 1 GCP 2004 Monitor Group and South African Tourism © 38
Enable efficient and successful
firm level choices
Outcomes of firm
level choices
(over time) will create
or destroy - jobs and
value
Choices about: Segments,
Product, Price, Promotion, Positioning Packaging,
Capacity and Investment
Government can assist industry by facilitating the availability of high quality
inputs that are used in the firm-level decision process
Goals and
Vision for the
Tourism Sector
(Already Decided)
Access to capital: finance,
skills, human resources
Transparency and
availability of information
Access to markets
Set the rules of engagement:Micro conditions:
Industry regulation, incentives, quality
control, transformation, etc
Create a suitable national platform
for business:Macro conditions:
Legal, Safety, Infrastructure, etc
Market level INPUTS
Macro and Micro INPUTS
Outputs of firm level choices
The framework for thinking about firm level choices is easy to understand, as it consists of inputs, outputs and outcomes. Within this framework, Government and Industry play various roles in ensuring the availability of quality inputs
Source: Monitor Group
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National Tourism Conference – Johannesburg 2004Phase 1 GCP 2004 Monitor Group and South African Tourism © 39
Enable efficient and successful
firm level choices
Outcomes of firm level
choices (over time) will create
or destroy - jobs and
value
Choices about: Segments,
Product, Price, Promotion, Positioning Packaging,
Capacity and Investment
The following framework allows Government and Industry to design an
action plan for enhancing the competitiveness of the tourism industry
Goals and
Vision for the
Tourism Sector
(Already Decided)
Set the rules of engagement:Micro conditions:
Industry regulation, incentives, quality
control, transformation, etc
Create a suitable national platform
for business:Macro conditions:
Legal, Safety, Infrastructure, etc
Availability and access to capital: finance,
skills, HR
Availability and access to capital: finance,
skills, HR
Transparency and
availability of information
Transparency and
availability of information
Access to markets
Access to markets
Organized Industry
leadership
(led by the TBCSA)
Organized Industry
leadership
(led by the TBCSA)
Source: Monitor Group
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National Tourism Conference – Johannesburg 2004Phase 1 GCP 2004 Monitor Group and South African Tourism © 40
Enable efficient and successful
firm level choices
Outcomes of these
firm level choices
(over time) will create
or destroy - jobs and
value
The goals and vision for the tourism industry are the same as the core
national economic objectives
Goals and
Vision for the
Tourism Sector
(Already Decided)
Goals and
Vision for the
Tourism Sector
(Already Decided)
Set the rules of engagement:Micro conditions:
Industry regulation, incentives, quality
control, transformation, etc
Create a suitable national platform
for business:Macro conditions:
Legal, Safety, Infrastructure, etc
Availability and access to capital: finance,
skills, HR
Transparency and
availability of information
Access to markets
Organized Industry
leadership
Sustainable GDP Growth
Sustainable GDP Growth
Sustainable job creation
Sustainable job creation
Redistribution and transformation
Redistribution and transformation
Source: Monitor Group, South African Tourism
Choices about:
Segments, Product, Price,
Promotion, Positioning Packaging,
Capacity and Investment
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Enable efficient and successful
firm level choices
South Africa’s outcomes are a function of the number and mix of tourists
visiting our shores
Set the rules of engagement:Micro conditions:
Industry regulation, incentives, quality
control, transformation, etc
Create a suitable national platform
for business:Macro conditions:
Legal, Safety, Infrastructure, etc
Availability and access to capital: finance,
skills, HR
Transparency and
availability of information
Access to markets
Organized Industry
leadership
Outcomes of firm
level choices
(over time) will create
or destroy - jobs and
value
Goals and
Vision for the
Tourism Sector
(Already Decided)
The current performance of tourism to SA is currently being produced by a very small percentage of the total
market opportunity
Source: Monitor Group, South African Tourism
Choices about: Segments,
Product, Price, Promotion, Positioning Packaging,
Capacity and Investment
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Enable efficient and successful
firm level choices
Several product shortcomings emerged from the GCP study
Goals and
Vision for the
Tourism Sector
(Already Decided)
Set the rules of engagement:Micro conditions:
Industry regulation, incentives, quality
control, transformation, etc
Create a suitable national platform
for business:Macro conditions:
Legal, Safety, Infrastructure, etc
Availability and access to capital: finance,
skills, HR
Transparency and
availability of information
Access to markets
Organized Industry
leadership
Outcomes of these
firm level choices
(over time) will create
or destroy - jobs and
value
Current product shortcomings: Domestic tourism products Cultural product Adventure product Family product Value-for-money
Current product shortcomings: Domestic tourism products Cultural product Adventure product Family product Value-for-money
Source: Monitor Group, GCP Phase 1 2004
Choices about: Segments,
Product, Price, Promotion, Positioning Packaging,
Capacity and Investment
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Outcomes of these
firm level choices
(over time) will create
or destroy - jobs and
value
At a firm level, the barriers to efficient decisions are around market access,
skills and a lack of pertinent information
Goals and
Vision for the
Tourism Sector
(Already Decided)
Organized Industry
leadership
Availability and access to capital: finance,
skills, HR
Availability and access to capital: finance,
skills, HR
Transparency and
availability of information
Transparency and
availability of information
Access to markets
Access to markets
Enable efficient and successful
firm level choices
Set the rules of engagement:Micro conditions:
Industry regulation, incentives, quality
control, transformation, etc
Create a suitable national platform
for business:Macro conditions:
Legal, Safety, Infrastructure, etc
Narrow band of interested consumers
Safety and security perceptions
Dependence on word-of-mouth referrals
SA is a niched & underdeveloped play in the channel
SMEs access to the channel is constrained
On certain key routes – airline capacity is constrained
Narrow band of interested consumers
Safety and security perceptions
Dependence on word-of-mouth referrals
SA is a niched & underdeveloped play in the channel
SMEs access to the channel is constrained
On certain key routes – airline capacity is constrained
A lack of appropriate skills appears to be increasing the cost of doing business and constraining growth
Finance is available but access is constrained
A lack of appropriate skills appears to be increasing the cost of doing business and constraining growth
Finance is available but access is constrained
Source: Monitor Group, GCP Phase 1 2004
Choices about:
Segments, Product, Price,
Promotion, Positioning Packaging,
Capacity and Investment
Poor accessibility to consumer information
General lack of pertinent Industry performance information and monitoring
Poor accessibility to consumer information
General lack of pertinent Industry performance information and monitoring
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Access to finance is an issue – but for very clear reasons when one
considers the relative positions of entrepreneurs and finance houses
ENTREPRENEUR
Complex business challenges Lack of available industry and consumer
data Business plans are based on
assumptions and anecdote Industry is attractive and seen to be
‘sexy’
“Build it and they will come”“Build it and they will come”
FINANCING HOUSES
Banks tendency is to strive for zero risk exposure
Acknowledge the complex business challenges faced by entrepreneurs
As a consequence have identified multiple risk areas for evaluation
“Rigorous data driven evaluation of business plans across multiple dimensions”
“Rigorous data driven evaluation of business plans across multiple dimensions”
INFORMATION GAP
There is very little performance data on the tourism industry and its sub-sectors, this makes it very difficult to assess business plans on an empirical basis.
Source: GCP Phase 1 2004 – Industry Interviews
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National Tourism Conference – Johannesburg 2004Phase 1 GCP 2004 Monitor Group and South African Tourism © 45
Choices about:
Segments, Product, Price,
Promotion, Positioning Packaging,
Capacity and Investment
Enable efficient and successful
firm level choices
Outcomes of these
firm level choices
(over time) will create
or destroy - jobs and
value
In the micro environment a lack of capacity at a local level and a lack of
industry organization are seen as key barriers to growth
Goals and
Vision for the
Tourism Sector
(Already Decided)
Availability and access to capital: finance,
skills, HR
Transparency and
availability of information
Access to markets
Institutional and regulatory capacity needs to be upgraded towards facilitating delivery and management
Develop tourism specific incentives
Institutional and regulatory capacity needs to be upgraded towards facilitating delivery and management
Develop tourism specific incentives
Set the rules of engagement:Micro conditions:
Industry regulation, incentives, quality
control, transformation, etc
Create a suitable national platform
for business:Macro conditions:
Legal, Safety, Infrastructure, etc
Organized Industry
leadership
Organized Industry
leadership
Industry is highly fragmented and some industry sub-sectors are not organized into representative associations
Cluster linkages are generally weak with low levels of information sharing
Mainstream SME participation and competitiveness issues at various points in the value chain
Industry is highly fragmented and some industry sub-sectors are not organized into representative associations
Cluster linkages are generally weak with low levels of information sharing
Mainstream SME participation and competitiveness issues at various points in the value chain
Source: Monitor Group, GCP Phase 1 2004
Confidential
National Tourism Conference – Johannesburg 2004Phase 1 GCP 2004 Monitor Group and South African Tourism © 46
Enable efficient and successful
firm level choices
Set the rules of engagement:Micro conditions:
Industry regulation, incentives, quality
control, transformation, etc
Outcomes of these
firm level choices
(over time) will create
or destroy - jobs and
value
Choices about: Target
Segments, Product, Price,
Promotion, Positioning
and Packaging
There are several of the major GCP findings that apply to the national
environment
Goals and
Vision for the
Tourism Sector
(Already Decided)
Availability and access to capital: finance,
skills, HR
Transparency and
availability of information
Access to markets
Organized Industry
leadership
Create a suitable national platform
for business:Macro conditions:
Legal, Safety, Infrastructure, etc
Build the SA brand Improve safety and security (reality and
perceptions) Provide the necessary infrastructure
(Public transport and tourism information provision and public amenities)
Drive transformation as a competitive advantage
Provide necessary regulatory and institutional platforms (incl aviation policy)
Build the SA brand Improve safety and security (reality and
perceptions) Provide the necessary infrastructure
(Public transport and tourism information provision and public amenities)
Drive transformation as a competitive advantage
Provide necessary regulatory and institutional platforms (incl aviation policy)
Source: Monitor Group, GCP Phase 1 2004
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Enable efficient and successful
firm level choices
Having the right outcomes for tourism is about ensuring that the industry
has the requisite quality inputs
Set the rules of engagement:Micro conditions:
Industry regulation, incentives, quality
control, transformation, etc
Create a suitable national platform
for business:Macro conditions:
Legal, Safety, Infrastructure, etc
Availability and access to capital: finance,
skills, HR
Transparency and
availability of information
Access to markets
Organized Industry
leadership
Outcomes of these
firm level choices
(over time) will create
or destroy - jobs and
value
In order to ensure that positive outcomes are achieved; Government and Industry need to jointly address the
barriers to competitiveness
In order to ensure that positive outcomes are achieved; Government and Industry need to jointly address the
barriers to competitiveness
Goals and
Vision for the
Tourism Sector
(Already Decided)
Facilitate, lead, take action
Facilitate, lead, take action
Source: Monitor Group, GCP Phase 1 2004
Choices about:
Segments, Product, Price,
Promotion, Positioning Packaging,
Capacity and Investment
Facilitate, lead, take
action
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Backup
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Europe:
Accommodation Usage Pattern: First Timers vs Repeaters
31%
8%9%
11%
8%
13%
11%
4%5%
19%
8%7%
6%
9%
36%
4%
2%
8%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Hotel Guest House Bed andBreakfast
Game Lodge Self Catering Friends andrelatives
Backpackers Camping Trains
First Timers
Repeaters
Per
cent
age
of b
ed-n
ight
s
It is clear that first timers spend the majority of their bed-nights in hotels and repeaters spend the majority of bed-nights with friends and family
Source: Departure Survey 2003
Europe: First Time and Repeat Tourists, Percentage Bed-nights by Accommodation Type, 2003
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29%
5%6%
12%
14%
18%
6%
3%
7%
20%
5%6%
12%
17%
27%
3%2%
9%
0%
5%
10%
15%
20%
25%
30%
35%
Hotel Guest House Bed andBreakfast
Game Lodge Self Catering Friends andrelatives
Backpackers Camping Trains
First Timers
Repeaters
Ran
ds (
Tho
usan
ds)
There is a clear switch out of hotels and into Friends and Relatives from First Timers to Repeaters
Americas:
Accommodation Usage Pattern: First Timers vs Repeaters
Americas: First Time and Repeat Tourists, Percentage Bed-nights by Accommodation Type, 2003
Source: Departure Survey 2003
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32%
1% 2% 1%
14%
37%
1%0%
12%
27%
18%
0%1% 2%
45%
2%0%
4%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Hotel Guest House Bed andBreakfast
Game Lodge Self Catering Friends andrelatives
Backpackers Camping Trains
First Timers
Repeaters
Ran
ds (
Tho
usan
ds)
Asians do not appear to be attractive tourists to the accommodation sector.
Asia:
Accommodation Usage Pattern: First Timers vs Repeaters
Asia: First Time and Repeat Tourists, Percentage Bed-nights by Accommodation Type, 2003
Source: Departure Survey 2003
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International tourists spend approximately more than a third of their bed-
nights in hotels and the remaining in alternative accommodation types
32,722
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
Hot
el
Sel
f C
ater
ing
Gue
st H
ouse
Bac
kpac
kers
Bed
and
Bre
akfa
st
Gam
e Lo
dge
Tra
ins
Cam
ping
Tot
al
Frie
nds
and
rela
tives
Total
Rest of World
SADC
Africa
Asia
Americas
Europe
Bed-nights by Type of Accommodation used in South Africa, 2003
# B
ed-n
ight
s (t
hous
ands
)
Note: Europe – UK, Germany, France, Italy, Netherlands; Asia – Japan, China; Africa – Kenya, NigeriaSource: SAT Departure Survey, Jan-Nov 2003
Bed-nights with friends and relatives which is the largest category at over 20 million nights, has been shown separately so as not to distort the picture for paid accommodation.
41%
11%
11%
9%
9%
8%
7%3%
20,261
13.4mil bed-nights
13.4mil bed-nights
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The majority of the paid bed-nights are spent in Gauteng and Western Cape
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
Gau
teng
Wes
tern
Cap
e
Kw
azul
u N
atal
Fre
e S
tate
Mpu
mal
anga
Eas
tern
Cap
e
Nor
th W
est
Lim
popo
Nor
ther
n C
ape
Africa
Asia
Americas
Rest ofWorld
Europe
SADC
Provincial Distribution, 2003
Sha
re o
f Bed
-nig
hts
The skew in bed nights has led to a disproportionate development of accommodation offering across the different provinces.
Note: Europe – UK, Germany, France, Italy, Netherlands; Asia – Japan, China; Africa – Kenya, NigeriaSource: SAT Departure Survey, Jan-Nov 2003, SAT Domestic Survey 2003, Monitor Analysis
1.4
2.0
2.1
2.0
2.3
1.2
Ave. # Provinces Visited
16,183
13,665
4,165
8,062
3,8453,055
2,2211,687
0,645
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40%
9%
5%
2%
9%
27%
3%
0%
5%
43%
7%5%
1%
9%
32%
2%0% 0%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Hotel Guest House Bed andBreakfast
Game Lodge Self Catering Friends andrelatives
Backpackers Camping Trains
First Timers
Repeaters
Ran
ds (
Tho
usan
ds)
Accommodation usage patterns are similar in nature.
Africa:
Accommodation Usage Pattern: First Timers vs Repeaters
Africa: First Time and Repeat Tourists, Percentage Bed-nights by Accommodation Type, 2003
Source: Departure Survey 2003
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Length of stay in SA – Botswana, Malawi, Swaziland, Zambia, Zimbabwe
• The most common length of stay by tourists from these markets remained constant or increased in Q3 2004.
• The most common length of stay of Zambian tourists decreased by 1 night in the quarter.
Q3 2004 Q3 2003 Diff
BotswanaAverage 8 12 -4
Most common 7 5 2
MalawiAverage 6 8 -2
Most common 4 4 0
SwazilandAverage 4 4 0
Most common 3 1 2
ZambiaAverage 6 7 -1
Most common 3 4 -1
ZimbabweAverage 8 12 -4
Most common 7 5 2
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Most common length of stay - Botswana
The number of nights spent in South Africa by tourists from Botswana remained the same in Q3 2004 compared to Q3 2003. The number of tourists who spent 2 nights in South Africa in Q3 2004 was greater than in Q3 2003.
Most common length of stay - Botswana
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Number of nights
% t
ou
rist
s
Q3 2003
Q3 2004
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Most Malawian tourists spent four nights in South Africa in Q3 2004. This is consistent with Q3 2003. There was an increase in the number of tourists who spent three nights in South Africa in Q3 2004.
Most common length of stay - Malawi
Most common length of stay - Malawi
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17
Number of nights
% t
ou
rist
s
Q3 2003
Q3 2004
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There was an increase in the number of nights spent in South Africa in Q3 2004. There was a peak at two introduced in Q3 2004 and an increase in the number of tourists who stayed three nights in Q3 2004 compared to Q3 2003.
Most common length of stay - Swaziland
Most common length of stay - Swaziland
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Number of nights
% t
ou
rist
s
Q3 2003
Q3 2004
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There was a decrease in the number of nights spent in South Africa by Zambian tourists in Q3 2004 compared to Q3 2003. The modal peak shifted from 4 nights in Q3 2003 to three nights in Q3 2004. A shift in the seven night peak in Q3 2003 to six nights in Q3 2004 was also noted.
Most common length of stay - Zambia
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17
Number of nights
% t
ou
rist
s
Q3 2003
Q3 2004
Most common length of stay - Zambia
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Most Zimbabwean tourists spent two more nights in South Africa in Q3 2004. There appears to be a shift in the length of stay of Zimbabweans from the modal peak of 5 nights in Q3 2003 to 7 nights in Q3 2004. The modal peak of 12 nights in Q3 2003 seemed to shift to 10 nights in Q3 2004. While the peak of 14 nights remained, fewer tourists stayed 14 nights in Q3 2004 compared to Q3 2003.
Most common length of stay - Zimbabwe
Most common length of stay - Zimbabwe
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17
Number of nights
% t
ou
rist
s
Q3 2003
Q3 2004
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