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Arrivals growth slowdown

The slowing global economy is having an impact on the growth of many industries and tourism is not immune.

We are seeing a slowdown in visitor arrival growth globally, with markets softening and outbound tourism declining. As expected, this is having an impact on New Zealand’s visitor numbers.

Tourism New Zealand is taking a leadership role and working hard to try and soften the decline by investing in some of our core markets and ensuring that industry is kept informed about what we are doing and what is happening globally so they can respond accordingly. Below is some information about growth slowdown that we have shared with industry.

Why are we seeing a slowdown in arrivals growth?

Global economic conditions and uncertainty from events like Brexit and the trade war between China and the USA are impacting people’s travel choices around the world. Some consumers are choosing short-haul and domestic travel over long-haul which means New Zealand is competing against other destinations for a smaller pool of people wanting to travel to long-haul destinations.

It’s important to remember that after a period of strong tourism growth a subsequent period of moderation should be expected, and given the cyclical nature of tourism this has happened plenty of times before.

What is arrivals data telling us?

After years of strong growth international arrivals to New Zealand are starting to soften. In the year ending July, total arrivals growth was up 2.8% and holiday arrivals fell flat at 0%. We expect this trend to continue, with holiday arrival growth set to remain low or maybe soften further for the 2019 calendar year, before potentially improving in the second half of 2020.

What action is Tourism New Zealand taking to soften the impact of slowing arrivals?

To try and help soften arrivals slowdown and support the industry Tourism New Zealand is increasing its investment in its largest visitor markets: Australia, USA and China. We believe increased investment in markets that have solid and growing connectivity as well as sufficient value and volume might help to mitigate the impact of decline.

As we head into this period of arrivals slowdown it’s incredibly important for New Zealand to continue to remain a desirable destination and top of mind as an option for international visitors. Our new global campaign, 100% Pure New Zealand Welcome is playing a crucial role in positioning New Zealand as a desirable destination and helping to make New Zealand distinctive to consumers. The campaign is now live across most of our 15 key markets and is working hard to showcase our unique offering, with early results showing great promise in engaging and motivating potential visitors to choose us.

What can industry do to continue to attract visitors during the growth slowdown?

Industry have an important role to play by ensuring they’re doing everything they can to provide a great visitor experience to continue to attract visitors from each of our markets and find ways to improve spend per visitor too. Businesses can learn more about our visitors and their preferences by using our Visitor Profiles tool

It’s also increasingly important for businesses to have a strong digital presence across online platforms so visitors know about them, can find them and book them easily. And of course, our globally recognisable campaign work is available for industry to leverage through their own marketing work.

What about the future?

While arrivals are predicted to remain flat for the near future, they’re expected to pick up again in the coming years. The Ministry of Business, Innovation and Employment’s (MBIE) 2019-2025 international tourism forecasts predicts visitor volumes are estimated to grow to 5.1 million in 2025, up from 3.9 million in 2018.