year two wonderful indonesia – pesona indonesia · 2019. 11. 20. · year two o wonderful...

YEAR TWO

WONDERFUL INDONESIA –

PESONA INDONESIA

ACHIEVEMENTS & CHALLENGES

December 2016

Year Two of Wonderful Indonesia - Pesona Indonesia Achievements & Challenges |Copyright © 2016 PT MarkPlus Indonesia. Reproduction in whole or in part without prior written consent is prohibited

3

With the goal to achieve 20 million interna-tional tourists by the end of 2019, government of Indonesia – through its Ministry of Tourism – re-quires comprehensive and strategic development of tourism destinations, infrastructure, market-ing, government regulations, and a supporting ecosystem. In addition, with the hope of continu-ously improving competitiveness of Indonesia’s tourism sector, there is a dire need to implement a global standard for optimal utilization of local resources.

In order to achieve the aforementioned tourism sector goals, MarkPlus Inc., through its Center for Tourism and Hospitality, is pleased to support Indonesia’s Ministry of Tourism and hospitality industry players with strategic advice and planning to compete globally and raise our tourism practice bar to international standards. Inaugurated on 8th November 2014 by Dr. Ir. Arief Yahya, M.Sc., the current Indonesia’s Minister of Tourism, MarkPlus Center for Tourism and Hos-pitality is committed to the goal of increasing the capability of human resources in the tourism sector through learning, obtaining comprehen-sive understanding through research, and for-

ABOUT MARKPLUS CENTER FOR TOURISM & HOSPITALITY

mulating feasible business solutions through its advisory services.

In alignment with its continuous efforts to help the development of tourism and hospi-tality industry in Indonesia, MarkPlus Center for Tourism and Hospitality regularly organizes panel discussions on several relevant subjects. In early December, the panel of discussion, led personally by Mr. Hermawan Kartajaya, was con-ducted in both Bali and Jakarta. As a result of the discussion, numerous insights covering the two-year achievements and upcoming challenges for Indonesia’s Ministry of Tourism have been obtained.

This year, MarkPlus Center for Tourism and Hospitality is launching the whitepaper, titled “Year Two of Wonderful Indonesia – Pesona In-donesia: Achievements and Challenges”, with the hope of evaluating the achievements and challenges of ‘Wonderful Indonesia – Pesona Indonesia’ and our tourism industry as a whole. This whitepaper is planned to be published an-nually as an independent performance evalua-tion to Indonesia’s Ministry of Tourism.

Inaugurated by The Minister of Tourism, Arief Yahya, on 8th of November 2014.

Previous Focus Group Discussion that was held on 28 November 2016.

Previous Strategic Discussion that was held on 14 November 2016.

Previous Strategic Discussion that was held on 14 November 2016.


The Ministry of Tourism has entered its sec-ond year in strengthening the “Wonderful Indo-nesia-Pesona Indonesia” brand. Various accom-plishments have been attributed to successful marketing strategies and promotional tactics which are increasingly being focused through-out the year. The “Wonderful Indonesia” brand has been acknowledged by many international reputable organizations throughout 2016 and it is predicted that the brand would boost the tourist visit to Indonesia to twelve million inter-national tourists visit while “Pesona Indonesia” brand has successfully achieved the 260 million domestic tourist trip target before the end of the year. The success of “Wonderful Indonesia” and “Pesona Indonesia” brand need to be comple-mented with the destinations offered in Indo-nesia. The development of the top ten priority destinations have been progressing steadily this year as a result of the destination development focused strategy by the ministry.

MarkPlus Center for Tourism and Hospitality have been actively participating in strengthen-ing Indonesia tourism through various activities. In 2016, MarkPlus Center for Tourism and Hospi-tality conducted a market research to People’s Republic of China to have a deeper understand-ing on Chinese market, the most potential in-bound travelers to Indonesia, especially on their travelling behaviour.

Various monitoring and evaluation of the

strategic implementation in the form of strate-gic discussion and focus group discussion have been conducted regularly to provide an over-view of Indonesia tourism achievements in 2016 and the Indonesian tourism challenges in 2017 from various perspectives, including the Ministry of Tourism, the local government, and industry players. This has been done to Indonesia’s top destinations such as Danau Toba and Bali.

To further encourage destination develop-ment, tourism SME empowerment was con-ducted through Marketeers Talk event. MarkPlus Center for Tourism and Hospitality facilitated the event to gather initiatives from local communi-ty to promote their tourist destinations. In sup-porting their ideas and helping them to build the startup that directly contributes to tourism in Indonesia, MarkPlus Center for Tourism and Hospitality, in collaboration with ICSB Indone-sia, launched the Wonderful Startup Academy, a tourism-based startups incubator.

Finally to support Indonesia’s tourism in 2017, MarkPlus Center for Tourism and Hospitality pub-lishes the 2017 Indonesia Tourism Whitepaper: “Year Two of Wonderful Indonesia - Pesona In-donesia: Achievements and Challenges”. Hope-fully, this whitepaper can be an annual initiative that provides a neutral view and the support to strengthen Indonesia tourism.


5

CONTENTS

6

3

4

7

9

26

Indonesia Tourism at Glance

Foreword by Hermawan Kartajaya

About MarkPlus Center for Tourism & Hospitality

Indonesia Tourism Assessment Framework

- Bali: Achievements and Challenges of Indonesia Tourism Golden Gate

Indonesia Touriscape: Competitiveness Perspective

Summary: After One Year of Wonderful Indonesia - Pesona Indonesia

- Indonesia Tourism Year Two Achievements & Year Three Challenges


INDONESIA TOURISMAT GLANCE

“Always start from The End”, said Arief Yahya, the current Minister of Tourism of Republic of In-donesia as he took the office in President Joko Widodo’s Kabinet Kerja. In alignment with the target of achieving 20 million international tour-ists and 275 million domestic tourists by 2019, Indonesia’s Ministry of Tourism has managed to show a lot achievements. Through the brand of “Wonderful Indonesia” and “Pesona Indonesia”, Indonesia’s Ministry of Tourism has managed to improve the overall branding strategy of Indo-nesia’s tourism industry to 47th rank by the end of 2015, exceeding Thailand and its “Amazing Thai-land” and Malaysia with its “Malaysia Truly Asia” ranked 83rd and 96th respectively.

Globally speaking, the tourism industry is a very “It” sector; a sector that displays strong re-silience against the dynamic and fluctuating conditions of economy compared to various other sectors. Bearing this factor in mind, it is not surprising that the government of Indonesia is paying a lot of attention to the tourism sector. Along with food-security, energy, maritime, and special economic zone development, tourism sector has been included in Indonesia’s top five development programs until 2019. By the end of 2015, tourism sector in Indonesia has managed to contribute up to ten percent of Indonesia’s national PDB, ranked as the 4th top contributor towards Indonesia’s income, and ranked 4th in creating employment space with the lowest employment-creation cost.

Many have predicted that the tourism sector of Indonesia could provide the biggest source of income for Indonesia by the year of 2020, Pres-

ident Joko Widodo has planned to increase its sectoral budgeting by 4 to 5 times from the ini-tial 4.2 trillion Rupiah. Such an increase in bud-gets is allocated with the hope of making Indo-nesia a tourism hub that will foster trade and investment activities in Indonesia.

Various strategies have been implemented by Indonesia’s Ministry of Tourism to achieve its 2016 target, which is 12 million international tourists and 260 million domestic tourists by the end of 2016. Backed by a strong positioning and clear differentiation, the program of “Wonderful Indonesia” and “Pesona Indonesia” has continued to gain popularity on international level and in-troduce the tourism habit for many Indonesians. Such claims are proven by the fact that Indonesia is facing an influx in the number of international tourist arrivals from China, Australia, and many ASEAN countries. In fact, by the end of 2016, in-ternational tourists from China visiting Indonesia have managed to surpass those from Australia.

From infrastructure development aspect, In-donesia’s Ministry of Tourism has focused its pri-mary attention towards creating special zones for tourism sector that are referred to as the “Ten New Priority Destinations”. These destinations in-clude Danau Toba, Tanjung Kelayang, Kepulauan Seribu, Tanjung Lesung, Candi Borobudur, Bro-mo-Tengger-Semeru, Mandalika, Labuan Bajo, Wakatobi, and Morotai. Through this program, it is envisioned that these ten new destinations will become the ‘New Bali’s’ that would cater to a wider set of preferences to attract international tourists. In 2017, the target that is set by Indo-nesia’s Ministry of Tourism is 15 million interna-tional tourists and 265 million domestic tourists. In continuing promotion of the successful brand of “Wonderful Indonesia” and “Pesona Indonesia” together with the significant budget increase, it appears quite feasible to achieve the target. However, what are the challenges that Indone-sia’s Ministry of Tourism might face in the up-coming years? This white-paper will thorough-ly discuss all the main challenges and attempt to provide insights and inputs on the ministry’s overall strategy.


7

The year of 2016 signifies various achieve-ments and improvements in Indonesia tourism sector. Compared with 2015, numerous initia-tives have been undertaken by Indonesia’s Min-istry of Tourism to achieve its visitors’ target in 2016. Those initiatives encompass political, con-ventional, and digital aspects. From the political aspect, one of the achievements that demon-strate the willingness to invite international tour-ists is to give free visa permits to visitors from 169 different countries all across the world. Such ease is being put into place so that international visitors would not face any administrative prob-lems and there is a high hope that this would turn out to be an attractive feature when visitors are choosing tourism destination options. Indo-nesia’s Ministry of Tourism has also managed to reform the policy regarding marine tourism which

INDONESIA TOURISCAPE: COMPETITIVENESS PERSPECTIVE

makes it easier for international ship to sail and for yachts to dock in Indonesia.

Conventional aspects, or generally referred to as the necessary tactics, are also continu-ously taken care of. Advertisement placements, whether in the name of “Wonderful Indonesia” in international media or in the name of “Pesona In-donesia” in local media, are consistently done in order to create and maintain brand awareness. In addition, this year, the brand of “Wonderful Indonesia” has managed to appear on Times Square, New York and London Taxi Cabs. Such actions are indeed impactful in encouraging the number of incoming visitors to Indonesia. In accordance with Indonesia’s Ministry of Tour-ism data, there is a 21 percent increase in visitors from the United Kingdom from January to Sep-tember 2016 compared with the previous year.

On the other hand, digital aspect has also become a focus for Indonesia’s Ministry of Tour-ism in creating promotion strategy for 2016. By analyzing the behavior and activities of tourists through its Look-Book-Share program, Indone-sia’s Ministry of Tourism has managed to build a partnership with various media. For Look, the ministry is now cooperating with Google, Baidu, and through its own platform, Indonesia Travel. As for Book, they are working together with TripAd-visor and CTrip. For Share, the ministry is working together with TripAdvisor, Facebook, and Insta-gram. Aside from digital placements, Indonesia’s Ministry of Tourism is also building a long-term partnership with travel influencers for wider ex-posure.

Another initiative that has become a mile-stone for Indonesia’s Ministry of Tourism is the creation of Indonesia Tourism Exchange (ITX), a digital platform that connects sellers and buy-ers in the entire tourism ecosystem, starting from those at micro-scale up to those at mac-ro-scale. The competitive edge of this platform is that it is very comprehensive, cost-effective, and customer-experience oriented. Generally quite comprehensive, it has managed to inte-grate both sellers and buyers, utilizes the digital platform to save cost, and ultimately provides a pleasant users’ experience.


Source: Indonesia’s Ministry of Tourism

WONDERFUL INDONESIA: HOW COMPETITIVE IS INDONESIA COMPARED TO OTHER ASEAN COUNTRIES?

Though various promotion strategies have been put into place, Indonesia’s Ministry of Tour-ism needs to have a clear landscape view on a regional level. As a part of Southeast Asia (SEA), Indonesia’s Ministry of Tourism needs to study Indonesia’s performance in tourism compared with other regional counterparts.

From the presented data, we can see how Chinese market is now a very lucrative source of tourists that is being aimed by many ASEAN countries. As of now, Thailand remains the coun-try to attract the highest number of Chinese vis-itors while Indonesia manages a much smaller portion. However, data has shown that Indonesia has begun to demonstrate a promising growth rate. It can be seen from the table how Vietnam too has an impressive rate of growth in number of Chinese tourist visits, at almost 60 percent. Such an impressive growth rate indicates that Vietnam has become a popular choice for Chi-nese tourists. There are more than 100 million outbound Chinese visitors reported this year. In-donesia must pay close attention to Vietnam as an emerging competitor in its race to win over the Chinese market.

IndonesiaMarketFocus

China

Singapore

Malaysia

Australia

Jepang

Malaysia

Arrivals on Destination (January-September 2016)

Singapore Thailand Vietnam

GrowthNumberGrowthNumberGrowthNumberGrowthNumberGrowthNumber

58.84%

8.52%

17.46%

-2.02%

0.71%

19.22%

2.68%

2.10%

-1.23%

3.56%

24.15%

-5.06%

-1.52%

14.69%

-0.61

43.52%

-2.37%

0.45%

2.08%

26.31%

2.12%

-23.76%

-14.97%

1,987,603

180,606

287,823

243,534

508,130

6,656,221

612,594

2,282,712

519,547

961,846

1,103,503

1,063,444

886,804

906,490

390,801

2,099,774

734,784

675,179

524,918

1,406,417

8,731,200

242,550

269,148


9

As for Singapore, the country has managed to retain second spot after Malaysia as the most favored tourist destination in SEA. The number of outbound tourists from Singapore to Malaysia is extremely high, thus contributing strongly to Malaysia’s overall number of foreign tourist ar-rivals. There are several reasons why many Sin-gapore tourists tend to choose Malaysia, such as due to geographical proximity, as well as similar cultural backgrounds, and the fact that shop-ping at Malaysia is much cheaper.

For the Malaysian market, the majority of its outbound tourists favor travelling to Thailand. The cultural diversity and geographical proximi-ty are again the main points of attraction. How-ever, Vietnam as well is emerging as a favorable destination by Malaysian tourist evident from the impressive growth.

Due to its proximity to Australia, Indonesia has remained a prime holiday destination for Austra-lian tourists. Therefore, Indonesia’s Ministry of Tourism must maintain its hold over this current market by preserving Indonesia’s positive brand-ing in Australia. On the other hand, the number of Japan tourist visits to ASEAN countries is rela-tively low, thus there needs to be additional in-centives offered to Japanese, such as relatively more unique propositions of experiential cultur-al travel in Indonesia.

INDONESIA TOURISM ASSESSMENT FRAMEWORK

2016 marked the second year since the brand of “Wonderful Indonesia” and “Pesona Indonesia” was made public. This year, various milestones have been achieved by Indonesia’s Ministry of Tourism, ranging from management of tourism destinations and investment, creating a pleasant customer journey for tourists, and reinforcing the branding identity of “Wonderful Indonesia” and “Pesona Indonesia”. However, the upcom-ing year will pose unique challenges of its own. Considering the rising competition in the tour-ism industry, along with various alternatives to tourism destinations offered in the market, a comprehensive yet sophisticated strategy must be devised by Indonesia’s Ministry of Tourism to stand-out amongst all its other international competitors.

An Indonesia Tourism Assessment Frame-work that has been developed by MarkPlus Center for Tourism and Hospitality will explore all the achieved milestones and upcoming chal-lenges through three main perspectives which are; Product Management, managing the devel-opment of tourism destination; Custom-er Management, managing the creation of a pleasant customer journey as a tourist; and Brand Management, managing means and strategies to strengthen the brand of “Wonderful Indonesia” and “Pesona Indonesia”.


INDONESIA TOURISMYEAR TWO ACHIEVEMENTS AND YEAR THREE CHALLENGES

As previously mentioned, the year of 2017 is filled with upcoming challenges. The desirable targets are set at 15 million international tourists and 265 million domestic tourists. Though there has been an increase in budget allocation by 4 to 5 times, achieving the target is not as easy as it sounds. By 2017, from the international tour-ists segment, there is a need to attract up to 1.25 million visitors per month. As stated before, challenges that are being posed to Indonesia’s Ministry of Tourism are mainly in terms of proper management of tourism destinations, manage-ment of customers’ journey and experience, and reinforcement of the “Wonderful Indonesia” and “Pesona Indonesia” brand as a whole.

INDONESIA TOURISM YEAR – 2 ACHIEVEMENTS AND YEAR – 3 CHALLENGES

YEAR TWO ACHIEVEMENTSYEAR THREE CHALLENGES

LOCAL AUTHORITIES PRIVATE SECTOR INTERNATIONAL COMMUNITYBR

AN

D

MA

NAG

EMEN

TCU

STO

MER

M

AN

AGEM

ENT

PRO

DU

CTM

AN

AGEM

ENT

Monitoring and Evaluating Ten Priority Destinations

development

Socializing Sadar Wisata mindset

Sharing the War-Room consolidated data

Facilitating tourism-oriented foreign investors

Focus on Ten PriorityDestinations

Rapid growth on tourisminvestment

Collaboration on TourismSpecial Economy Zone

development

260 mio and 12 mio touristachieveable targets

Stable domestic market

growth

International recognitions

National priority

Nation branding alignment

Partnering with reliableforeign travel agents

Supporting the local digitalconnectivity

Simplifying Tourism SMEslicensing

Educating the true “Halal”behavior

Amplifying the digitalcontent

Responding the safety andsecurity counter-communication

Tapping the new potentialmarket: Great India

Sharing the promotionbudget

Promoting Bali-Lombok-Labuan Bajo as “BhinnekaTunggal Ika Triangle”

Aligning national and localtarget and strategy

Intensifying tourismmentoring bureau

Synergizing with thenational tourism strategy

Empowering travel bloggercommunities

Applying H2H (Human-to-Human) homestays

Developing MICE andChina-friendly amenities

Opening new international

Familiarizing the localexperience

Maintaining the onlinebrand positive sentiment

Increasing DMO involvement

Clarifying foreign investment incentives

Building local hospitality

educational society

Enabling spiritual

community at Borobudur

Temple

Coordinating the destination development Master Plan


11

PRODUCT MANAGEMENT: IMPROVING THE QUALITY OF TOURISM PRIORITY DESTINATIONSMonitoring and Evaluating Ten Priority Des-tinations Development

Since one year ago, Indonesia’s Ministry of Tourism has focused on the development of ten priority destinations. Various strategies have been executed by the government for these destinations’ development, ranging from for-mulating a Strategic Area for National Tourism, developing Special Economic Area for Tourism, and reaching out to investors both inside and outside Indonesia.

Bearing in mind the numerous efforts that have been placed to promote these destina-tions, a thorough supervision and monitoring must be put in place to ensure that the develop-ment is heading in the right direction. Through an adequate supervision and monitoring, it is expected that the development would meet the government’s goals and expectations. Aside from supervising and monitoring the infrastruc-ture development, government of Indonesia, through its Ministry of Tourism, must also try to pinpoint the tourist anxieties and desires when visiting these destinations. This holistic approach should be conducted with a committed effort that if a problem arises, corrective actions to fix the tourism destinations infrastructure and hu-man resource capability would be executed in an immediate manner.

A good example that displays the recently discussed case would be the development of Danau Toba. Recently, infrastructure develop-ment has been accelerated, direct flight route has been opened, and promotion has been in-creased. However, the number of incoming tour-ists is still not near the expected target. Through a good supervision and monitoring, an immedi-ate and strategic corrective action that incorpo-rates the best practices from local community might

be able to tackle the root of the problem.

Socializing ‘Sadar Wisata’ MindsetA fully aware mindset, Sadar Wisata, for tour-

ism means understanding the importance of tourism sector for the local community as a whole. Sadar Wisata is basically composed of seven main aspects: Safety, Order, Clean, Cool, Friendly, and Memory. Indonesia government tends to call these seven aspects as Sapta Peso-na. These Sapta Pesona values must be upheld by the local community in order to encourage tourists to obtain a positive experience and con-sequently recommend the destination to their friends and relatives.

The Sadar Wisata mindset is closely entwined with the role of local government in ensuring greater participation from the local community. A regular socialization with the local community as well as synchronizing local government pro-grams with the principles of Sapta Pesona would definitely create a sense of ownership towards the tourism sector from the local community. Thus, the local community would effectively contribute in improving the quality of tourism destinations over the short and long term.

An example of good Sapta Pesona implemen-tation would be Kabupaten Banyuwangi. Doz-ens of festivals and events each are conducted each year, out of which most of them witness active participation from the local community. Through such actions, both directly and indi-rectly, local community’s awareness towards the importance of tourism industry will increase. Recently, Banyuwangi’s local community have demonstrated their support towards the local tourism industry by being actively involved in creating a strong online presence on the social media.

Sharing the War Room Consolidated DataMultiple breakthroughs have been conduct-

ed by Indonesia’s Ministry of Tourism. One of them is the creation of a War Room. Realizing that the existing data in the tourism industry is not organized, not integrated, and most important-ly is outdated, Mr. Arief Yahya, Indonesia’s Minister


of Tourism, who is ex-CEO of Telkom Indonesia, established a data room with real-time data update. In this War Room, Indonesia’s Ministry of Tourism is working together with Telkom In-donesia to monitor tourist movements inbound to and outbound from Indonesia. Through this method, data could be obtained quickly and de-cision-making process can be conducted with ease.

Though only several parts, data that is possessed by Indonesia’s Ministry of Tourism would be very beneficial if it could be utilized by local governments, especially regency or prov-inces that focus heavily on tourism sector such as Banyuwangi or Bali. Through such data sharing, coordination between central and local govern-ment would be more synchronized. In addition, this method would enable local governments which are not proficient at technology utiliza-tion yet to rapidly improve their capacity.

An excellent case of this data utilization would be Candi Borobudur. As one of the world wonders, Candi Borobudur has immense po-tential to attract hundreds of thousands of both international and domestic tourists every year. Should the local government of Central Java, the province where Candi Borobudur is located, be able to utilize this data sharing from War Room, it would enable them to provide service that is specially adjusted to the tourist’s profile and im-proves their customer journey.

Building Local Hospitality Education SocietyIndonesia has always been known for its hos-

pitality. However, it so happens that such hospi-tality is only displayed by service providers in the tourism industry. This causes a conundrum that such a sense of hospitality is not demonstrated by the local community. Hence, a community action that aims to educate the local people on the importance of hospitality must be es-tablished.

Hospitality education could be easily de-veloped through collaboration between local government, Department of Culture and Tour-ism, Tourism Schools, and hospitality industry

business players in each province or regency. By doing so, the awareness on the importance of hospitality values could proliferate faster and reach out to a wider arrays of citizens.

Indonesia’s Ministry of Tourism has been working together with various Tourism Schools and attempted to educate local community in areas which are included in the ten priority des-tinations. However, these education programs are not conducted in a sustainable and continu-ous manner. In addition, resources allocated for such actions are also very limited, thus hinder-ing the learning growth of the local community. Therefore, it is preferred that Indonesia’s Ministry of Tourism builds partnership between Tourism Schools and private business sectors in the tour-ism industry to establish the envisioned local community that is oriented towards hospitality and service education.

Enabling Spiritual Community at Borobudur Temple

Candi Borobudur is one of the destinations that is a part of UNESCO World Heritage Center. Every year, Candi Borobodur manages to be-come a magnet for hundreds of thousands of tourists. Nowadays, most of the activities con-ducted at the location is photo-taking with a small number of people who are actually trying to learn the history of the temple. Such phe-nomenon is causing Candi Borobudur, one of the most magnificent wonders of the Buddhist, to lose its soul and essence that is supposedly designated for religious activities.

With hope to restore the essence and soul of Borobudur as a temple, the government, through Indonesia’s Ministry of Tourism, must support continuous religious activities to be conducted on the temple. While on one hand it will utilize the temple in accordance with its designated purpose, it will also increase its at-traction as a place for religious tourism.

Coordinating the Destination Development Master Plan

The total investment that entered Indonesia


13

this year has reached USD 900 million. It is pre-dicted that nearing the end of 2016, this number will grow to up to USD 1.5 billion. A major part of these investments made are heavily focused on hospitality industries, especially on tourism destination development. The output of these investment is heavily linked with the price of land on the developed areas. Without proper coordination, cost of land development would significantly surge. In the long run this might hamper the Return of Investment (ROI) as the development cost would go up.

In addition to attracting visitors in the tourism industry, Indonesia’s Ministry of Tourism must also coordinate with Investment Coordinat-ing Board of the Republic of Indonesia (BKPM) and local government to manage the direction of the incoming investment. Through such ac-tions, it is expected that a healthy atmosphere for investment and a profitable condition could always be maintained.

Increasing DMO InvolvementDestination Management Organization

(DMO) is an organization that manages a tour-ism destination and they are responsible for the management and promotion of a certain tourism destination. The form of this organiza-tion could vary from a singular authority by the government to a joint partnership with any related industry players. Most of the time, the system that is followed by Indonesia is a single body of authority, in which all the planning and implementation are solely conducted by Indo-nesia’s Ministry of Tourism on central and regional level. However, the problem is that not all local governments are prioritizing tourism sector. Such cases, many times, are causing problem for the development, management, and promotion effort at a tourism destination.

A partnership with DMO is a very common practice outside of Indonesia. Some of these DMO are from private sectors. As for the effort in developing tourism industry, Indonesia still has much to learn and benchmark with established DMOs. Therefore, both the central and local gov-ernment of Indonesia could start formulating

a base in establishing partnership with a DMO that is suitable with the current political and economic situation in Indonesia.

One of the DMOs that manages a tourism destination in Indonesia since 2009 is SwissCon-tact. SwissContact has coordinate tourism effort in Flores and several islands around Nusa Teng-gara Timur (NTT) by creating a sophisticated management system to increase the competi-tiveness of Flores as a tourism destination. Indo-nesia’s Ministry of Tourism should consider such forms of partnership, especially in developing remote areas that have a lot of tourism potential.

Facilitating Tourism-Oriented Foreign Inves-tors

As discussed multiple times, tourism industry has a very strong relation with the flow of in-vestments. Indonesia’s Ministry of Tourism aims to enable investment for USD 1.5 billion in 2016, majority of them obtained from foreign inves-tors. The form of legal business that is allocat-ed for them is generally in the form of hotels or properties. There are multiple cases where inves-tors are seeing their investment only as a regular property business instead of hospitality industry as a whole.

There is a strong tendency that investors only develop hotel industries with the aim of obtain-ing a return without considering the balance of other factors in the tourism industry. This is caus-ing the direction of a tourism area development to not go in alignment with the positioning and differentiation that is offered by both the local government and the local community.

Taking an example of Ubud, one of the most prime tourism destination in Bali. Due to its strong market demand, there has been estab-lishment of many high-end hotels with numer-ous quantity of rooms to accommodate the market. However, such a practice is not in align-ment with Ubud’s current positioning as “The Spirit of Bali”. Ubud has always been promoted as a region with strong cultural roots. Thus, mass quantity development of modern hotels has the potential to hamper Ubud’s current values.


Clarifying Foreign Investment IncentivesTo attract investors in tourism industries,

government of Indonesia has provided an in-centives scheme to make the investment look more lucrative. One of the incentives being pro-vided is tax incentives. In this incentive scheme, it is mentioned that government of Indonesia will provide incentives of 25-100 percent for KEK. Such a mechanism is quite concerning for in-vestors as there is no clear specific incentive for any specific amount of investment. From the perspective of foreign investors, clarity on tax incentives would highly affect the tax interest. Hence, clarity on incentive scheme could enable investors to predict the rate of return more ac-curately.

Based on the interview conducted with Mr. Heri Fikrio, an Associate Director of China Har-bour Indonesia, he agreed that clarity would be one of the primary keys in attracting investors. In addition, aside from tax clarity, legal clarity is also a factor that is a concern for foreign investors.

Aside from product management, customer management is another important pillar that must be taken into account. Tourists, a term used to refer to customers in the tourism sector, must be properly managed to create loyalty, be it in the form of return visit or advocacy to rela-tives. A satisfied tourist would willingly provide recommendations to family, friends, community, or even to the public about the positive experi-ences during their journey. In addition, in an era when everyone is connected, stories about their experiences can easily spread and influence oth-ers.

Looking at the milestone of tourism activities in Indonesia, domestic tourists are showing ex-cellent resilience despite the fluctuation in the political and economic conditions in Indonesia. Such phenomenon is a perfect example that tourism activities is not only a lifestyle that is fol-lowed by international citizens, but also actively followed by local citizens. The high number of domestic citizens could be used as an asset to conduct digital marketing, especially through the use of social media.

On the other hand, the number of interna-tional tourists coming into Indonesia is also ex-periencing a positive growth. Through a consis-tent promotion conducted in priority countries such as China, Australia, Malaysia, and Singa-pore, tourists from these countries have consis-tently grown over the past year. As per August 2016 data from Biro Pusat Statistik, the number of visitors from China visiting Indonesia reached 980.184. It is followed by Singapore and Austra-lia, each with 939.231 and 791.235 tourists, re-spectively.

In conducting tourist’s experience manage-ment, Indonesia’s Ministry of Tourism needs to

CUSTOMER MANAGEMENT: OPTIMIZING THE MOMENT OF TRUTH FOR TOURISTS


15

work closely with various stakeholders in pro-viding an unforgettable experience to visitors. Though the majority of customer management falls under the responsibility of industry players, Indonesia’s Ministry of Tourism, to a certain ex-tent, must intervene through either central or regional governments to establish an adequate quality control.

Local government, as the representative of policy makers, must be able to create an ecosys-tem that is conducive for the tourists and indus-try players in order to create the desired custom-er experience. Without simultaneous effort by both of these parties, the creation of ecosystem that supports customer management could not be achieved. In addition, positive relations that are created with international community must also be maintained, especially with those inter-national travel agents and potential tourists.

Supporting the Local Digital ConnectivityNowadays, connectivity has transformed into

a basic need in conducting tourism activities. Tourists aka tourism customers tend to see, or-der, pay, and share their either positive or negative experience via online channel. Such behavior in-dicates that online connectivity is a crucial factor that must be possessed by any agency respon-sible for development of a tourism destination.

At the very basic, connectivity is a general need of not only tourists, but also local citizens. Therefore, provision of Wi-Fi connection and in-ternet access at public places, especially at tour-ism spots, has become very crucial. On the other hand, the meaning of online connectivity can’t be single-handedly perceived as providing mere infrastructure. To a certain extent, information and history of tourism destination can be effec-tively integrated to further feed the tourist’s curi-osity regarding any destination.

It is critical for us to learn from China and South Korea, where majority of its cities have internet that is free for use. Such factors enable exchange of information to happen easily, thus fostering growth in tourism.

Simplifying Tourism SMEs LicensingSMEs are one of the primary drivers in Indone-

sia’s economy that are also crucial for the tourism sector. In the context of tourism, businesses de-veloped by SMEs are focused on promotional ef-forts, transportation, travel agents, food and bev-erage, accommodation, show business, MICE, information providers, tourism consultants, and spa. These forms of business will highly support the tourism spots as a whole and improve the well-being of local citizens.

A long and winding bureaucracy tends to hamper the formation of small businesses in the tourism industries. There are too many forms of permits which are needed, a time-consuming process, and many other bureaucratic factors, which are detrimental to SMEs development and tend to cause demotivation. It can’t be de-nied that such factors have a huge impact on the growth of tourism industries. Nowadays, local governments already attempt a coopera-tion with BKPM to create a “One Door, One Stop Service”. However, such efforts are not effective enough and thus further evaluation on licensing processes must be considered.

Educating the True Halal BehaviorLatest data has demonstrated that Indone-

sia continues to be the country with the larg-est Muslim population. This could act as both a strength and limitation for Indonesia’s Ministry of Tourism. Through “Halal Tourism”, various Mus-lim-friendly attractions have been introduced as options for tourists. In general, the concept of halal tourism usually offers religious activities and halal food guarantee as an option.

The concept of halal is basically something more than just a tangible and functional aspect. The concept of halal must actually be widened to encompass honesty, good-will, justice, and other such intangible factors.

If we take a closer look at Banyuwangi where the majority of its local citizens are Muslim, they opt to not only offer halal concept but take an-other leap to introduce the value of Islamism. The kind of mindset that is possessed by Banyu-


wangi local citizens is to value local culture but maintaining openness. As stated by the Depart-ment Head of Culture and Tourism of Banyuwan-gi, Mr. Bramuda, “Banyuwangi pushes the value of Islamism such as honesty and good-will in its tourism concept, which is more than just a sim-ple halal tourism.”

Applying H2H (Human to Human) Homestays

In 2016, it is planned that 100.000 homestays will be established everywhere all across Indo-nesia, especially at the top ten priority destina-tions. These homestays will be established with a standard design that would prioritize local wis-dom from each region. The diversity of culture in Indonesia will be introduced from a simple ac-commodation concept that is homestay.

In its development, homestay owners will be equipped with knowledge of accommodation management. However, the most important thing that would be the core differentiation of homestay would be its intimacy value. Homestay owners will have the chance to interact directly with tourists and thus could present them with their daily culture as an Indonesian. Homestay owners need to prioritize the concept of H2H (Human-to-human) in its service. Therefore, the provided service would be able to touch the heart and emotions of the tourist through their hospitality culture. Thus, the desired unforgetta-ble experience would be created.

Developing MICE and China-Friendly Amenities

MICE is one of the most potential man-made attractions that could be used to attract tourists. Sporting events, festivals, and exhibitions could be a source of attraction in a region that would escalate their income from tourist engagement. One of the core problems that could still be found in Indonesia is the availability of space or capacity. The inadequate capacity, especially in the form of room quantity and meeting rooms, presents its own unique challenge for hosting an exhibition. It is a different case when hosting a festival or sporting events, whereby these two events are easier

to host, depending on a region’s creativity and capability in hosting the event. One of the com-petitive edges in MICE Tourism for a region is the availability to create combination between lei-sure (pre- and post-event) and business (during the event). Thus, the potential for income is sig-nificantly larger.

On the other hand, the case of China tourists is slightly different. China is one of the prime con-tributor of the number of international tourists coming to Indonesia. However, the use of lan-guage for amenities is dominantly still English. It is hoped that cities that are top destination for Chinese tourists could provide amenities that accommodate the tourist local language and thus ease their customer journey in Indonesia. Added with the target of 10 million international tourists coming from China by the end 2019, it can’t be denied that such a provision of ameni-ties could prove to be critical.

Opening New International Flight for Specific Market

Accessibility is one of the three components of tourism, aside from attraction and amenities. In the past one year, Indonesia’s Ministry of Tour-ism has planned an accelerated development in ten priority destinations that encompass infra-structure, destination management, and many others.

In order to support Indonesia’s Ministry of Tourism effort, the availability of inbound and outbound flights to and from the destination should also be taken into account. Air travel ac-counts for the majority of trips by tourists, espe-cially those coming from outside of Indonesia. Thus, more airline routes must be opened to ac-commodate the demand from the market.

If we use China as an example, a country where the majority of its citizens practice Buddhism, it could be assumed that their citizens might have an interest in visiting Candi Borobudur. It is the largest Buddhist temple in the world, which might become a point of attraction for the Chi-nese tourist. Introduction of a direct flight from China to Yogyakarta could tap the potential of


17

inviting Chinese tourists to visit Indonesia.

Partnering with Reliable Foreign Travel Agents

Recently, there is a negative trend of interna-tional travel agents neglecting the internation-al tourist. Such cases could be detrimental and cause a boomerang effect towards the tourism destination as it might create a negative brand-ing.

Supposedly, cooperation scheme that is con-ducted between international travel agent and the tourism destination is aimed to create an in-flux of tourist into Indonesia while at the same time ensuring that they are provided with an adequate service. Therefore, by partnering with only reliable foreign travel agents, Indonesia’s Ministry of Tourism could ensure that the tourist will have a pleasant journey when they are visit-ing Indonesia.

Familiarizing the Local ExperienceLittle information regarding the local culture

tends to cause unmatched expectation and re-ality. Tourists may complain about a certain ser-vice at a tourism destination, while on the other hand, that could be a normal thing to occur on a daily basis, vice-versa.

Therefore, there is a need to familiarize in-coming tourists with the local culture to ensure that they would be able to appreciate and get to know the local wisdom and culture. Taking an example of Medan, where the majority of its citizens talk in a very loud voice. To some tourist, such gestures might be taken as rude as they do not know the local citizens’ daily culture. Such cases might hamper our effort in attracting tour-ists.

Maintaining the Online Brand Positive Sen-timent

The brand of “Wonderful Indonesia” and “Pe-sona Indonesia” have been well known by both international and domestic citizens. Such claims are proven by the high number of tourists coming to visit Indonesia. The continuous growth in tourist numbers have proven that the current

promotional effort have been effective.

We must take a closer look at how interna-tional tourists tend to share their holiday expe-rience via online channels, both positive and negative experience, via their social media. Such cases must be realized by Indonesia’s Ministry of Tourism, as there is a dire need to manage their complaint while at the same time utilize their positive sentiment.

Social listening is a method that can be used to manage both positive and negative senti-ment to a specific brand using an online plat-form. Through social listening, it can be made known what are the current global citizens’ sen-timent towards “Wonderful Indonesia”, “Pesona Indonesia”, and Indonesia as a whole.


One of the main points in the agenda of Ministry of Tourism is to strengthen “Wonderful Indonesia - Pesona Indonesia” branding. A host of expansive “Wonderful Indonesia - Pesona Indonesia” branding campaigns have been im-plemented over the past year in a bid to boost awareness of Indonesia tourism and to achieve the target of 12 million international tourists and 260 million domestic tourists.

Vigorous campaigns conducted by the Minis-try of Tourism are not only directly affecting the number of tourists but the “Wonderful Indonesia” campaign has also won numerous prestigious international awards at events, from ITB Berlin to China Travel and Leisure Awards. These awards are also a solid proof that “Wonderful Indonesia” is getting increasingly renowned globally which in turn translates into greater interest in visiting Indonesia, ultimately assisting in achieving Indo-nesia’s desire to become a tourism hub.

A myriad of achievements by Indonesia’s tour-ism industry and its contribution to the economy has made the tourism sector a national priority. President Joko “Jokowi” Widodo has decided that tourism sector must become a national priority sector of development in 2017. Being a nation-al priority sector, the development of Indonesia tourism is expected to be more focused and integrated, which would improve the quality of tourism destinations and ultimately deliver more effectively on the “Wonderful Indonesia” promise to the tourists.

Apart from being the national priority sector, the success of “Wonderful Indonesia” in attract-ing the attention to Indonesia is also considered as an achievement towards nation branding. “Wonderful Indonesia” is expected to not only be the leading campaign on national identity for

BRAND MANAGEMENT: STRENGTHENING THE “WONDERFUL INDONESIA – PESONA INDONESIA” BRAND

tourism but also in foreign trade and investment sector. A stronger “Wonderful Indonesia” cam-paign would eventually support Indonesia as the tourism hub in Southeast Asia which would also potentially result in a rise in investment and trade to Indonesia.

2017 would be a challenging year for the Ministry of Tourism. With the “Wonderful Indo-nesia-Pesona Indonesia” campaign, the Minis-try of Tourism is expected to attract 15 million international tourists and 265 million domestic travelers. President Jokowi has also given his commitment to increase the budget for tourism promotion. However, these tasks would not be easy and straightforward due to high competi-tion from neighboring countries like Malaysia, Singapore, and Thailand, followed by other ASEAN tourism rising star countries such as Vietnam.

In order to further strengthen the brand, it is required that the Ministry of Tourism synergizes with the local government, especially local governments of the 10 tourism priority desti-nations, in developing a consistent strategy and defining the agreed targets. The cooperation be-tween the Ministry of Tourism and industry play-ers is much needed to promote an integrated tourism offering. Such an initiative would help both parties to have effective and efficient pro-motion. The Ministry of Tourism is also required to strengthen content marketing to raise inter-national exposure and at the same time perform a counter-communication strategy to negate the coverage on political and social issues that could potentially affect the “Wonderful Indone-sia – Pesona Indonesia” brand.

Promoting Bali-Lombok-Labuan Bajo as “Bhinneka Tunggal Ika Triangle”

Indonesia is a very diverse country. It con-sists of more than 17 thousand islands, from Sabang to Merauke, inhabited by people from various ethnic, religious, racial, and cultural backgrounds. Bali is one of the most renowned areas in Indonesia, rich in cultural and religious attractions, complemented by hugely appealing natural beauty. Bali neighboring island Lombok is also gaining prominence as a tourism desti-


19

nation in Indonesia. Lombok differentiates itself through halal tourism as it is also known also known as the island of thousand mosques, hop-ing to become one of the world’s popular halal destinations. Slightly farther from Bali is Labuan Bajo – a unique peninsula in Eastern Nusa Teng-gara. Labuan Bajo has vast landscapes of islands and home to a unique species, the Komodo Dragon. It is the largest lizard and the oldest ancient living animal in the world. Majority of dwellers in Labuan Bajo are Christians despite its close proximity to Lombok, which is largely inhabited by Muslims. These areas, so called the “Bhinneka Tunggal Ika Triangle” represent the unity in Indonesia’s diversity. A synergic promo-tion campaign could be implemented around this theme by leveraging the idea of this unique diversity in the area.

Research Consortium of Udayana University expressed the idea of Bali, Lombok and Labuan Bajo as the destinations with rich and diverse spiritual culture. Adding the beauty of surround-ing natures and the cultural heritage of these destinations together form highly attractive three different yet united Indonesian characters.

Aligning National and Local Target and Strategy

The Ministry of Tourism has been implement-ing Indonesia’s tourism marketing strategy con-sistently. The implementation of the strategy must also be supported by the local govern-ment’s respective efforts in formulating and ex-ecuting their own tourism marketing strategy. The strategy pursued by each of the local governments should be aligned with the nation-al grand strategy of tourism marketing by the Ministry of Tourism to yield the maximum out-come. Both the strategy and the targets for each region should be based on mutual agreement. More often than not, the local governments face various obstacles to achieve the given targets. These difficulties could be overcome together by aligning and synergizing the strategies between the Ministry of Tourism and the local govern-ments.

To that end, there should be strategy ses-

sions to transform the marketing plan into a marketing activity plan at the local level by both parties. By doing so, both parties would be on the same page in terms of strategy and tactics to achieve the regional targets. Alignment between the target and the strategy would eventually bolster help bring closer to the national target and achievements.

Intensifying Tourism Mentoring BureauIn relation to the alignment of marketing

strategy and promotion tactics, the Ministry of Tourism has been organizing mentoring teams to conduct discussions with the local authorities in implementing the strategy in each region.

Given the importance of the alignment pro-cess and strategy execution in each region, the mentoring team formed by the Ministry of Tourism must proactively guide each local government. Regular meetings could be one of the points in the agenda in 2017 to achieve the national target.

Sharing the Promotion BudgetThe tourism industry players have their own

goals to promote their products or services. Ho-tels are proactively promoting their room fa-cilities and banquets to various companies, travel agencies advertise their tourism packages, and the airlines are promoting their services heavily, all to gain as much profit as possible from the tourism industry.

However, the tourism industry could create an integrated offering, with the Ministry of Tourism, promoting Indonesia tourism as well as offering end-to-end products and services. By doing so, the effort of promoting tourism could be less costly and yield more effective results.

Synergizing with the National Tourism Strat-egy

Lack of coordination between industry play-ers makes the tourism industry players offer various and sporadic tourism products which leads to a less effective tourism promotion. The 10 tourism destinations prioritized by the Minis-try of Tourism should also become the focus of products and services offerings in the industry.


Therefore, the Ministry of Tourism needs to conduct regular coordination meetings with tourism industry players to put itself and the industry players on the same page. This syner-gy helps both parties to focus on the same mis-sion, to achieve the national target. In addition, the tourism industry players, as stakeholders who deal directly with tourists regularly, could also provide feedback to the Ministry of Tourism based on the anxieties and desires of tourists.

Empowering Travel Blogger CommunitiesSharing their travel experience has become

a norm for tourists in the form of photos, sto-ries, or the combination of both. As tourism be-comes closely connected with the digital world, the role of storytellers or bloggers is becoming increasingly influential. More often that not a travel trip occurs not only as a result of tourism promotions, but also by taking inspiration from the stories of various travel bloggers.

Tourists are faced with various choices of travel destinations. Low price would definite-ly attract tourists. However, recommendation from a trusted person or reputation of a tourist destination in the digital world could also make tourists to eventually decide to go to a particular tourist destination. Travel bloggers increasingly hold important roles, both individual influencers and community of bloggers. These approaches are expected to build reputation of the destina-tions in Indonesia to attract tourists, from both domestic and foreign tourists.

Amplifying the Digital Content“Wonderful Indonesia” branding is continu-

ously being implemented in the international market. The paid media, social media, and gov-ernment-owned media tactics continue to pro-mote Indonesia tourism. Various contents are continuously being offered, based on the char-acteristics of each origin. However, customized content must be amplified to yield more im-pactful results.

One of the tactics that could be done is by entering in a partnership with several estab-lished social media, such As through promotion

in the form of promoted tweets and Facebook ads. By advertising through social media tools such as Facebook ads and promoted tweets, “Wonderful Indonesia” campaign could reach the right potential tourists and the community, which would result in an increased awareness of “Wonderful Indonesia” at the international level. In order to yield more effective results, the tour-ist profile and behavior for each country of origin should be investigated in advance, then the suit-able content in the amplifier media for each of these countries’ audience could be determined.

Responding to the Safety and Security Counter-communication

Security and political stability of a country is a strong decisive factor when considering a trip abroad. A safe country would attract more tourists. Indonesia is often faced with unpredict-able political conditions such as demonstrations which brings the national issues to the fore.

These factors could heavily influence the “Wonderful Indonesia” brand which creates the need for a counter-communication tactic to clarify and positively align the perception of the international community towards Indonesia. Through such counter-communication tactics, the Ministry of Tourism could communicate positive vibes about Indonesia as a balancing factor of the other news (especially negative news).

Tapping the New Potential Market: Great India

India and other southern Asia countries make one of the promising markets for Indonesia tour-ism in the future. India is the second most popu-lous country in the world. Despite limited access to Indonesia, India has contributed 115,838 visits in the first quarter of 2016. This year, the Ministry of Tourism is targeting 350,000 Indian tourists.

Culturally, Great India has close relations with Indonesia. Region such as Bali with the major Hindu community can offer great attractions for Indian, Nepali, and Sri Lankan tourists, which is also the case with other southern Asia countries like Pakistan and Bangladesh. Indonesia could be an alluring tourist destination due to its rich and diverse regions.


21

BALI: ACHIEVEMENTS AND CHALLENGES OF INDONESIA TOURISM GOLDEN GATE

Bali is the most important tourist destination in Indonesia. On average, Bali accounts for 40% of the tourist arrivals every year. Bali, as a desti-nation or the branding, requires to be well-man-aged. Its magnitude of importance in Indonesia requires a solid and comprehensive destination management, so as to be able to maintain its position as the largest contributor to Indonesia tourism while at the same time, reinforcing the “Wonderful Indonesia-Pesona Indonesia” branding.

PRODUCT MANAGEMENT: DEVELOPING THE “BALI AND BEYOND” CONCEPT

Bali has been holding various achievements and still counting. One recent is the new tourist development area around Nusa Islands which are quite popular among foreign tourists. Nusa Islands is a cluster of islands near Bali, Nusa Lembongan, Nusa Penida and Nusa Ceningan. Despite the imbalance in the development on these islands, Nusa Islands has become an emerging destination for domestic and foreign tourists.

Some of the challenges that need to be antic-ipated by Bali in developing its remarkable des-tinations in 2017 include the zoning of tourism attractions, data consolidation, and the manage-ment of safety, security, and sustainability. Em-powerment of Desa Wisata into new attractions could also enrich the tourism attraction in Bali. Moreover, the investment is still essential for an even development in Bali.

YEAR – 2 ACHIEVEMENTS YEAR – 3 CHALLENGES

LOCAL AUTHORITIES PRIVATE SECTOR INTERNATIONAL COMMUNITY

BRA

ND

M

AN

AG

EMEN

TCU

STO

MER

M

AN

AG

EMEN

TPR

OD

UCT

M

AN

AG

EMEN

T

Zoning the tourismattraction

Consolidating Bali tourismreal-time data

Managing Bali safetysecurity and sustainability

Activating the frequent-visited attractions

Nusa Islands as theextentions destination

of Bali

Bali as tourism mainentrance holds a 24%

growth for 2016

Ubud as New YorkTimes’ one of 52 Places

to Go in 2016

Building point-to-pointpublic transportation

Consolidating with thetourism industry players

Managing the localamentities development

Empowering YouthWomen, and Netizen for Branding

Strengthening MICETourism promotion

Spinning the WonderfulIndonesia ‘Bali’-sub brand

Creating a China-centrictourist experience

Tapping the B2B market fortravel agents

Expanding airportoperational time

Developing an Investor Guideline

Collaborating with conversation organizations

Empowering Bali DesaWisata as new alternativeattraction

Attracting tourisminvestor for North Balidevelopment

Creating new cultural man-made attractions


Zoning the Tourism AttractionBali has various types of tourist destinations,

ranging from nightlife to cultural tourism. How-ever, development of some tourist attractions in Bali is out of mere copying of the successful tour-ist spots or activities, without considering the positioning of the region. For example, it would be inappropriate to have nightlife and clubs in Ubud. This issue could be a lesson learned for other local governments in developing the tour-ism destinations in their respective regions.

Consolidating Bali Tourism Real-time DataBali, as the main gateway of Indonesia tourism,

is visited by millions of tourists each year. It is vital to have uniform and consolidated data from in-dustry players. This consolidated data could also be a basis for any strategic decision-making. For example, the occupancy rate. The low occupan-cy rate may pull the market prices to consumer, while high occupancy rate may pull the market price to the service provider. Similarly, the case with the number of arrivals in each region. By doing so, the local governments and the indus-try players could have a better and deeper un-derstanding of the tourist behavior.

Managing Bali Safety, Security, and Sustainability

Bali is proven to be Indonesia’s most ready tourist destination. With 40% of Indonesia’s to-tal tourists come to Bali every year, the safety, security, and ecosystem sustainability become crucial things to be managed. Safety rate needs to be maintained, especially related to the road rules. The security aspect also needs to be main-tained. In the past, two bombings incidents had visibly affected Bali tourism thus, safety is indeed important for tourists. The issue of sustainability could gain momentum in the future. Sizeable amount of garbage is produced from tourist activities every day. To that end, consumable goods production needs to be directed towards environmental-friendly production, as well as undertaking effective waste management.

Empowering Bali Desa Wisata as New Alternative Attraction

A very strong culture in Bali is one of the most important attractions of the island. Desa Wisata Development may further improve the concen-tration of tourist destinations in Bali to further north. With a diverse Desa Wisata, tourists can directly participate and socialize with people, to understand the local culture in more depth. The traditional ceremonies often done by villages can be interesting attractions, as long as they are well managed and tourist activities do not inter-fere with the ceremonial processions.

Attracting Tourism Investors for North Bali Development

Bali development is hugely concentrated in the southern part of Bali due to its proximity to the international airport as the main entrance for tourists. In fact, the northern area of Bali also stores a wealth of tourism potential, both in terms of culture and natural resources. Northern Bali also offers attractions such as water sport tourism. In addition, the travel distance is not huge as such, especially for long stay tourists. This can also support the development of new attractions as an alternative tourist destination. However, the development has not been as fast as in northern Bali compared with southern Bali. To that end, there is a need of a scheme that is easy for the local government to partner with investors.

Creating New Cultural Man-made Attractions

Apart from its culture and natural resources, Bali is also home to many artisan crafts. There are tourist attractions consisting of crafting, such as sculptures. Garuda Wisnu Kencana in Bali is one of the interesting attractions and an example of man-made attractions. Similarly, Bali Pemuter-an, a combination of cultural tourism and water tourism, is famous for its underwater temple which is a man-made attraction created in 2005 as part of a conservation program.

Activating the Frequent-visited AttractionsTourist destinations are not only determined

by the local community and the government. Sometimes, a tourist destination can be created due to the enthusiasm of a group of tourists who


23

think that a certain area has high tourist appeal. Canggu, for example, is very famous due to fre-quent visits by foreign tourists to surf in the area. What has followed up is development of cafes and restaurants in order to serve the surfers and as a result the area continues to develop as a tourist spot. The local government needs to ob-serve such areas that have not been popular yet carry the potential to become a tourist destina-tion, such as Amed area.

Developing an Investor GuidelineOne of the concerns of investors, particular-

ly foreign investors, is the distinct and explicit terms and conditions. Additional expense could be one of the issues for investors that creates in-convenience. Bali is renowned for its indigenous community culture, where the customs and rules are held very highly. One of the customs and rules is the expense should be given to the local villages. The additional expenses are com-monplace for the locals, but can be a potential inconvenience for investors. It is imperative to create a guideline for investors that documents the written and unwritten rules in Bali to further understand the nature of the Bali community.

Collaborating with Conservation Organizations

Biodiversity of water tourism in Bali is one of the most popular attractions. However, the com-munity is often too focused on development surrounding the destination, not the attractions itself. The natural resources attractions need to be duly safeguarded. Through a collaboration with international conservation organizations, Bali can maintain the ecosystems for tourist at-tractions. The sustainability of these attractions can be maintained through the use of cut-ting-edge technologies and systems.

As the main door of Indonesia tourism, Bali managed to grow by 24% compared with last year. Bali’s readiness, especially in terms of access and amenity, attracts numerous tourists to visit the island. Although there are issues with traffic congestion in some areas, the road access in Bali is ready to accommodate tourists. The rapid de-velopment of hotels and villas in Bali has given more alternatives for tourists visiting Bali.

The upcoming challenges in terms of tour-ist management, among others, are related to the transportation and capacity management. There is a need to manage the I Gusti Ngurah Rai airport for the upcoming needs of the future. Meanwhile, the construction of hotels and villas, which tend to converge in a certain region, needs to be well-managed to create a healthy competition among players. And, there is a need for developing a more customized amenity to cater tourists, especially Chinese tourists.

Building Point-to-Point Public Transportation

Although there are many attractions in Bali, tourists often face troubles reaching at the at-tractions in various areas. The means of trans-portation is often a rental car. In fact, there is a great potential to even out the tourists visit in Bali. Public transport is one of the solutions very much needed in Bali. Through public transport, tourists can visit other attractions with a relative-ly low price, increasing the visits to other attrac-tions and tourists will not be too concentrated in southern Bali. In addition, it can be an answer to the issue of congestion that is now facing tour-ists in Bali.

CUSTOMER MANAGEMENT: MANAGING THE TOURIST EXPERIENCE THROUGH ATTRACTION ZONING AND TAILORED OFFERING


Consolidating with the Tourism Industry Players

Generally, the tourism industry players have been supporting tourism in Bali through their products and service offerings. However, such independence should not be allowed to con-tinue. The local government needs to reach out to the industry in order to optimize the satisfac-tory tourist experience. A consolidation is need-ed between local governments in Bali with the industry players. Thus local governments can optimize the potential existing in the market through regional regulations that favor the local tourism industry.

Managing the Local Amenities DevelopmentThe local government has a very big role in

supporting local tourism. One of them is the development of regional amenity. To create an enjoyable experience for tourists, amenities play a fairly important role. The local government must also be able to maintain a fair competition, thereby benefiting both tourists and the indus-try. In southern Bali, for example, the growth rate of construction of hotels and villas needs to be kept an eye on by looking at the level of occu-pancy in the area. If there is too much develop-ment with few differentiations, it is necessary to review the licensing policy to create a healthy competition between players. The local govern-ment plays a major role in creating the afore-mentioned conditions.

Creating a China-centric Tourist ExperienceChina is one of the main target markets of

Indonesia tourism. As the main gate of tourism, Bali needs to be prepared not only to welcome general tourists but also the need for special-ization in Chinese tourists. Visitors from China would be much more comfortable if they feel accepted and facilitated in terms of language. Chinese tourists experience is not only reflected during its trip but a more holistic 5A concept, namely Aware, Appeal, Ask, Act, Advocate. The 5A concept could describe conditions at which point they are still not Chinese-friendly.

Tapping the B2B Market for Travel AgentsBali is a destination with a huge potential for

MICE. Various regions in Bali have a large MICE capacity. Bali has a special appeal among tour-ists to not only attend a business meeting, but also travelling. In addition, most companies still prefer to use travel agents to manage their travel activities. Travel agents often feel threatened by the presence of Online Travel Agents (OTAs). But there is still a segment of the B2B market which is big enough to generate income as well. By targeting a particular segment, it is expected to create a sustainable balance between the travel agents and OTAs.

Expanding Airport Operational TimeArrival in Bali in the afternoon is often faced

with airline delays. One of the reasons is due to the limited operating hours of Bali airport. Con-sidering the construction of new infrastructure such as the new line as well as the building a new airport takes long time, Bali needs to pro-long its airport operating hours to 24 hours to increase the flight capacity from and to I Gusti Ngurah Rai Airport.


25

BRAND MANAGEMENT: STRENGTHENING “BALI” AS THE SUB-BRAND OF “WONDERFUL INDONESIA – PESONA INDONESIA”

Bali is very popular at the international level, both for its natural and cultural resources. One of the rising destinations is Ubud due to its strong differentiation. In 2016, Ubud was elect-ed as one of the 52 Places to go to by the New York Times, together with various leading tourist destinations around the world. A strong cultur-al identity maintained and guarded by the local community has become the main attraction for foreign tourists who visit Ubud, creating a very memorable experience.

In 2017, Bali needs to work on creating its own identity and strengthening the same. Bali is already proven as a tourist destination. How-ever, it would be stronger if Bali is supported by good brand management, which is aligned with the branding of the twins “Wonderful Indonesia - Pesona Indonesia”. Bali also needs to empower young people, women, and netizen to strength-en its branding and capitalize its economic po-tential, such as MICE Tourism.

Empowering Youth, Women, and Netizen for Branding

Youth, Women, and Netizen (YWN) is a very important segment in the world of marketing. YWN are believed to be the future economic drivers and the brand which is more familiar to all three segments will be successful. Bali brand-ing reinforcement requires a good collaboration with YWN. Bali’s existing brand could be im-proved and strengthened through the empow-erment of young people, women, and netizen. Bali could collaborate not only directly related to the promotion of the attractions, but also through sharing experiences with friends and family.

Strengthening MICE Tourism PromotionMICE great potential in Bali needs to be con-

tinuously explored. Events, meetings, and con-ferences in Bali could provide an economical benefit much greater than general tourism. With MICE tourism, the tourists visit would rise, the duration of stay would get longer, because of pre- and post-event activity, and result in in-creased spending compared with general tour-ism. It would provide a direct economic impact on the economy in Bali. Moreover, Bali with its tourism appeal, must also have qualified MICE facility and amenity which makes MICE Tourism easier to promote.

Spinning the Wonderful Indonesia ‘Bali’ Sub-brand

One missing element from Bali is a unique identity. Bali’s strong brand in the internation-al community is not currently supported by a strong identity of Bali itself. Imagine, if Bali had a distinctive brand that is continuously commu-nicated, it could become a very strong brand and would be able to support its parent brand, “Wonderful Indonesia”. Through visual synergy and communication between Bali and “Wonder-ful Indonesia”, these two brands would be able to provide benefits for tourism in Indonesia.


SUMMARYEntering its second year, Indonesia’s Minis-

try of Tourism is relatively more prepared and focused in promoting the brand of “Wonderful Indonesia – Pesona Indonesia”. Numerous mile-stones have been achieved, and its branding has been made popular on international scale. However, there are still many challenges that must be solved. Destination management has become a priority that is imperative to be ca-tered right away. A safe, clean, and organized tourism spot can be a huge attraction point to potential tourists. In addition, attention towards customer journey management is also needed as a means to continuously improving tourism destination. The more tourist-friendly a destina-tion is, the more tourists will come and visit the destinations. The Chinese market right now is the biggest and most lucrative market for Indo-nesia. There is an urgent need to understand the anxiety and desires of potential Chinese tourists to further create a positive impression and thus make them more willing to recommend Indone-sia to their relatives as a tourism destination.

Brand management through the strengthen-ing of “Wonderful Indonesia – Pesona Indonesia” must also be a highly prioritized agenda of In-donesia’s Ministry of Tourism. Bali will continue to play its role as the main gate of tourism, and thus its role must be optimized. On the other hand, digital-based activities must continue to run and manage so as to improve brand equity of “Wonderful Indonesia – Pesona Indonesia” at both international and domestic scales. Target-ing another potential and lucrative market, such as Great India, is also an option that could be considered by Indonesia’s Ministry of Tourism.


27

AUTHORS

Abdullah [email protected]

Adrian Osmond Hudiono

[email protected]

Kevin [email protected]

EDITOR:

Priyanka [email protected]

Berry Biz Hotel, Ground FloorJl. Sunset Road No. 99, KutaDenpasar 80361, IndonesiaPhone: +62 361 8495 670

Fax: +62 361 8495 671

www.markplusinc.com

year two wonderful indonesia – pesona indonesia · 2019. 11. 20. · year two o wonderful...

Documents