South Korea

Market Overview

South Korea is New Zealand's seventh largest market in terms of visitor numbers and our seventh largest source of expenditure.

After several years of year-on-year growth in visitor numbers as South Korea's economy emerged from a period of recession, arrivals slumped 21.6 per cent in 2011 (to 52,787), as a result of the Christchurch earthquake and ash cloud disruptions caused by the Chilean volcanic eruption.

Numbers are expected to recover during 2012, however, and early signs are positive. March arrivals showed the first significant sign of that resurgence to be up 12.3 per cent on 2011, and this was followed by a 38.2 per cent increase in arrivals in April.

More accessible airline capacity - as a result of Korean Air increasing the frequency of its service to Auckland - improved demand for tour group bookings, and an emerging independent traveler market are all expected to have a positive impact on arrivals.

Despite the decline in numbers in 2011, Korean visitors still represent a valuable segment of New Zealand's tourism market, spending close to NZD$130 million in the year ending February, 2012, or $2600 per person - above the $2400 average for all visitors.

Total demand for overseas travel in South Korea is expected to grow strongly this season, despite risk factors including rising oil prices, elections, and fluctuating exchange rates. Leading travel wholesalers are forecasting significant growth in bookings in 2012, with one forecasting demand for Asia-Pacific destinations to increase by over 20 per cent, led by demand for short-haul destinations such as Singapore, Hong Kong, and Palau. New Zealand also faces competition from the United States, which has grown in popularity due to a favorable exchange rate, low airfares, and strong publicity around the visa waiver programme.

The majority (over 70 per cent) of South Koreas travel to New Zealand on pre-arranged group or semi-structured tour packages organised by South Korean tour companies. Just over half (51 per cent) combine a trip to New Zealand with another destination.

Tourism New Zealand is working with South Korea's travel trade to develop greater focus on mono-destination travel targeting the high-end luxury, and independent travel markets. These sectors have been identified as having considerable potential to help build profitability in the South Korean market, and they match well with what New Zealand can offer holidaymakers.