Bali’s tourism industry must diversify: Industry group

Bali’s tourism industry has to focus on different markets in the wake of catastrophes such as the global financial crisis and the triple disasters in Japan, according to an industry group.

Diversification would make Bali’s tourism industry less vulnerable to downturns in one or two target market nations.

“Market diversification is an important step for strengthening Bali’s position as a top international destination,” Indonesia Tour and Travel Agencies Association (Asita) Bali chapter chairman Aloysius Purwa said.

Purwa said that a large number of local hotels and tour and travel agencies still targeted a single major market.

“For instance, out of 345 tour and travel agencies operating in Bali, 50 focus on the Japanese market,” he said.

Over-reliance on a single major market was similar to putting all of one’s eggs in a basket, he said — if something bad happens to the basket, you might end up with no eggs at all.

“The Japanese were still reeling from the impact of the global economic crisis, which caused a significant drop in the number of Japanese visitors who travelled to Bali in 2009 and 2010. The drop was further aggravated with the end in October 2010 of Japan Airlines’ direct flight to Bali. Now, they have to deal with a devastating earthquake, deadly tsunami and nuclear catastrophe. Surely the number [of visitors] will drop further,” he said.

For years Japan ranked in the top five markets for the island’s tourism industry. Japanese visitors were known for their loyalty to Bali and their generosity, with an average stay of 7.56 days in 2008 and average expenditure of US$1,268.85.

Hotels and tour operators that depended heavily on Japanese visitors might experience firsthand the adverse impacts of putting all their eggs in one basket as the number of Japanese visitors was expected to fall, he said.

Initial signs of a bleak future — cancellations from individual Japanese travelers and from Japanese travel operators — were reported in days immediately following the temblor and tsunami.

Despite the prospect for hard days ahead, Purwa said that the local tourism industry might draw an important lesson from the Japanese disasters on the importance of market diversification.

A similar opinion was voiced by Indonesia Hotel and Restaurant Association (PHRI) Bali chapter secretary Perry Markus.

“In the aftermath of the 2008 global financial crisis several hotels in Bali launched efforts to diversify their markets. Those hotels had previously catered to certain markets only. Nowadays, they sell and promote their products to a very diverse market,” he said.

Hotel owner and tourism expert Bagus Sudibya said that market diversification must go hand in hand with promotional campaigns.

“Bali is a very fortunate island. Throughout the global financial crisis the total number of foreign visitors to this island kept increasing, from 1,968,892 in 2008 to 2,229,945 in 2009 and 2,493,058 in 2010. Similar increases also occurred in the number of domestic visitors,” he said.