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Unlocking Domestic Tourism in South Africa DOMESTIC TOURISM SEMINAR 09 MAY 2011

The Domestic Tourism Case . Main objective:Increases volume and valueReduces seasonalityIncreases geographic spreadEntrenches travel and tourism culture in in the countryCreates and sustains jobs through meaningful participationCurrent account net effect ? ?drives local consumption"Others:?

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Unlocking Domestic Tourism in South Africa DOMESTIC TOURISM SEMINAR 09 MAY 2011

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    1. Unlocking Domestic Tourism in South Africa DOMESTIC TOURISM SEMINAR 09 MAY 2011

    2. The Domestic Tourism Case Main objective: Increases volume and value Reduces seasonality Increases geographic spread Entrenches travel and tourism culture in in the country Creates and sustains jobs through meaningful participation Current account net effect – “drives local consumption” Others: “Improved lifestyle” Social cohesion and national pride Overall, the country needs a clear policy statement and strategy on development of domestic tourism 1

    3. Environmental Scan GNI per capita - $5760 US (high than China at $3650 US) About 4 million people earn between R150 000 and R1 000 0000 (Unisa Bureau for Market Research, 2010) More jobs in the formal sector created as jobs were shared in the informal sector Net rise in unemployment from 24% in the last quarter of 2010 to 25% in the first quarter in 2011. Emerging inflationary pressures - high fuel and electricity costs and not demand (Reserve Bank, 1Q2011) Favourable interest rates – debt reduction focus Disposable income – 77% towards debt servicing Is there a room for improvement? 2

    4. State of domestic tourism in SA Overall: VFR - 55% Leisure – 14% Funeral – 11% Religious – 8% Business – 2% Other – 10% Leisure spend averages over R700 but business is over R2000 Case for increased leisure and business travel Need to extract maximum value from VFR, Funeral, religious & others 3

    5. State of domestic tourism in SA Day trips v/s Overnight trips (Activities): Recreation and entertainment: 68% - 52% Business: 4% - 1.2% (need more overnight business travel) Sports: 2% - 5% Nature based: 9% - 15% (one of the more balance portfolios) Social: 11% - 15% Religious: 3% - 10% 4

    6. State of domestic tourism in SA Overall spend driven by restaurants and shopping at malls Overall travel (share of pie): Most visited provinces for overnight trips (KZN – 21%, Limpopo – 17%, EC – 15% and GP – 14%) Most visited – day trips (GP – 24%, KZN – 18%, Limpopo – 15% and EC – 12%) NC remains the least visited province - overnight 2.7% and day visits 3.3% Contrast: Leisure: (WC, EC, NC, FS, KZN, NW, GP, MP and Limpopo) 5

    7. State of domestic tourism in SA Who leads in VFR: KZN – 20% Limpopo – 17% EC –16% GP – 15% Then – MP, NW, FS, WC and NC 21% of leisure travelers visit Friends and Relatives 6

    8. State of domestic tourism in SA Acess issues: WC (Car 55%, Air 16% and taxi 12%) GP (Car 30%, Air 3.9% and taxi 45%) KZN (Car 32%, 1,9% and taxi 54%) Generally other provinces main use taxi and car mode. Train – insignificantly low – under 5% in every Province (NC being the highest). Access is a major issue when it comes to addressing spread 7

    9. State of domestic tourism in SA Reasons for not travelling: Not travelling for financial reasons (33%) Prefer to travel shorter distance (26%) – but travels less than 40 km No one to visit Price – (only 1.6%) 2.2% time constraints Work or school (11%) No transport (0.3%) Nobody to travel with? (travel clubs?) Too much hassel to travel (0.4%) Old age (Accessibility travel????) 8

    10. Where to for domestic tourism in SA Need to think beyond the ordinary (e.g. Role of social clubs (e.g. stockvels), Role of Burial societies, Role of sports fan clubs (post 2010) etc) – should be both demand stimulation and supply Partnerships (private, media, trade, public, communities etc) Understanding opportunities presented by the various categories Recognition of what already exists Improve access to information and marketing presence Technology (e.g. easy of booking) Improved and diversified access facilities Need to understand the market and the value chain Understand unintended policy consequences 9

    11. What path do we want to take? THANK YOU

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