Going the distance

Australia's and Europe's visitor
markets show promise to help shore
up Hawaii's tourism industry


Hawaii -- Wooing the World

Hawaii's tourism planners have set their sights beyond the state's strengths on the West Coast and in Japan to target emerging markets around the globe. In the last of a three-part series detailing the opportunities that show the most promise, we take a look at Europe, Australia and New Zealand.

>> Sunday: U.S. East Coast
>> Yesterday: Asia, outside Japan

HAWAII'S visitor arrivals from Europe, Australia and New Zealand have dropped dramatically in the last decade, but the travel industry says conditions are right to see improved performance.

A weakened dollar, increased airlift and more focused marketing are expected to increase visitor arrivals and boost economic performance from these regions, assuming there are no more global disasters.

While these international markets may never equal the importance of Japan or other Asian countries to Hawaii, it's important for the visitor industry to develop a diversified portfolio of markets to lessen the potential impact of geopolitical troubles, terrorism and world events like SARS, said Frank Haas, vice president of tourism marketing for the state Hawaii Tourism Authority.

"We're in a recovery growth period," Haas said. "We are moving into good times as we recover from some of the bumps. But long-term success relies on getting the right messages out."

Although Europe, Australia and New Zealand don't have as high of visitor counts as other regions, it's still important to reach and cultivate these markets, he said.

Visitor markets in these regions have barely been tapped, so the potential for Hawaii to expand its share of travelers is high, Haas said.

Plus, these visitors tend favor longer stays and spend healthy sums on activities and events.


In the late 1990s the weak European economy and the exchange rate played a negative role in Hawaii's tourism, while the terrorist attacks of Sept. 11, 2001, the Iraq war and SARS continued to bleed the market, said Thomas Drechsler of Hawaii Tourism Europe.

Visits from Europe to Hawaii peaked in 1993 when 220,000 people came to the state, but tanked shortly after, falling to 120,000 a decade later. But with a favorable exchange rate and the possibility of more flights, the forecast is good for the market to rebound, Drechsler said.

Delta Air Lines plans to launch a Rome-to-Cincinnati flight with a connection to Honolulu. Also, the Italian airline Alitalia is discussing relaunch of its Milan-to-Las Vegas flight. Thomas Cook, a sister company of Lufthansa, plans to start a year-round charter to Honolulu via Las Vegas starting next summer, Drechsler said.

"Considering the European visitor figures from the early nineties, the European market offers a great potential. According to all major tour operators and airline partners we anticipate a significant increase for FY04," Drechsler said.

The European market, especially travelers from the United Kingdom, is extremely sensitive to world events and political turmoil, said John Elsom, chairman of wholesaler Pag & Moy Ltd. of Leicester, U.K. He added that he expects to see about a 15 to 20 percent increase in business to Hawaii from Britain next year.

"I think we are getting more used to the consequence of the war on Iraq and thankfully there hasn't been any serious terrorism," Elsom said. "The further away we get from Sept. 11 the better."

While the Australian market is more resilient to global events, a lack of available airlift has significantly impacted the market in recent times, said Helen Willams, of Hawaii Tourism Oceania.

The addition of a flight from Sydney to Honolulu by Hawaiian Airlines last month is expected to stem a trend of diminishing seat capacity from Down Under, she said.

Visitor traffic from Australia has been in steady decline since 1990 when Hawaii received 238,000 arrivals. By 2003, that figure had sunk to 78,000, according to the state Department of Business, Economic Development and Tourism, the result of major carriers using long-range jets to bypass Hawaii and fly nonstop from Australia to the West Coast.

"Australia only offered a very limited number of seats so it didn't provide a great opportunity to market, and business began to fall through the cracks," Williams said.

Hawaiian has added non-stop, round-trip service from Down Under four times weekly, adding more than 1,000 seats to Hawaii per week, a 20 percent increase. The service is expected to generate more than 34,000 visitors to the islands in its first year, producing more than $40 million in visitor spending and $4 million in state tax revenue.

"My gut is that we're coming back," Willams said.

Since Hawaiian's launch, wholesalers have reported steady gains in travelers.

"We did 238 bookings on the first day of sale, and we've booked a total of 1,400 passengers through May," said Ed Smith, manager of Talpacific Holidays. "We had only projected 250 bookings," he said.

The increase in flights combined with a weakening dollar has enticed travel wholesalers to begin renewed marketing of Hawaii as a destination, Smith said.

"We are seeing brochures again," he said.

While increased airlift has the potential to increase visitor arrivals for Europe and Australia, that's not the case for New Zealand arrivals, said Darragh Walshe of Hawaii Tourism Oceania. New Zealand marketers are lobbying to grow Hawaii airline service and are focused on increasing economic impacts among the visitors that they've got, he said.

"With the current airlift challenges, we are concentrating more on extending length of stay, increasing visitor spending and shoulder season travel," Walshe said.

For identification purposes

Characteristics of European travelers:

>> High potential to increase visitor numbers
>> Very dependent on exchange rates
>> Long-staying, averaging 13.5 days
>> High-spending, averaging $1,945 per trip
>> Visit an average of three islands per trip
>> Participate heavily in sports and activities
>> Very sensitive to geopolitical issues and terrorism

Australian and New Zealand characteristics:

>> Love to shop
>> High interest in indigenous aspects of Hawaii
>> Like to wine and dine
>> Not deterred by the distance
>> Often visit neighbor islands
>> Typically stay longer
>> Heavy participation in golf and soft adventure
>> Growing meetings and incentive market

Source: Marketing Garden Ltd.

Europe's inbound market to hawaii

Arrivals from the United Kingdom and Germany, Hawaii's core markets in Europe, fell to all-time lows after 2001, but major tour operators and airline partners predict significant increases this year:



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