Chairman's report

The past year has been one of two vastly different stories for Australian tourism.

In the first six months of the year, our industry continued to post steady growth in international visitation and still stronger growth in spend, with $126.1 billion in overnight tourism expenditure. These results came off the back of a stellar year in 2018/19, in which our industry had already surpassed the lower range target of the 10-year Tourism 2020 plan by exceeding $115 billion annually in combined domestic and international overnight visitor spend.

We continued to build on this performance in the first half of 2019/20, with a solid program of consumer and trade marketing activity in our 15 international markets across the globe. At the same time, we had maintained our standing as one of the strongest performing destinations in terms of yield, ranking 39^th for visitation, seventh for tourism receipts and first for visitor spend.

By the close of the 2019 calendar year, international arrivals had reached a new record of 9.5 million visitors for the year, having grown from a modest 5 million at the start of the decade, and spend to a record $45.4 billion. These results were driven by strong growth from key markets like China, Japan, New Zealand, North America, India, Singapore and emerging markets like Indonesia.

At the same time, tourism was acknowledged as one of five globally successful Australian industries alongside agribusiness, education, financial services, and resources and energy.[1] And while growth in some economies overseas had started to slow, with the potential to impact travel, we still had plenty of reasons to be cautiously optimistic about the future.

Against this backdrop, the second half of the year has been one of stark contrast. The devasting impacts of the summer bushfires, and the subsequent impact of international media attention negatively affecting bookings to Australia, saw us pivot to focus on rebuilding both domestic and international visitation to those communities both directly and indirectly affected by the fires. Backed with $61 million in funds as part of the Australian Government’s $76 million rebuilding Australian tourism package, we began implementing domestic and international recovery campaigns, a business events recovery strategy, additional media hosting plans and special funding initiatives to support Australian industry attending the 2020 Australian Tourism Exchange.

Just as we were beginning to gain momentum with our bushfire recovery efforts, the global COVID-19 pandemic brought global travel to a complete and sudden stop. The impact was immediate as we saw international visitor numbers plummet to near zero during some of the darkest months of the pandemic. Overnight we saw tourism businesses and associated industries across the country impacted as almost every aspect of travel came to a standstill. Through generous government support many of these businesses were able to mothball during the months of lockdown as health authorities sought to contain the spread of COVID-19. While this was happening, we paused our campaigns, but continued to engage consumers and trade with new and virtual ways – maximising available technology to get our message through.

As we closed out the year, we started to see many tourism businesses tentatively reopening under new COVIDSafe guidelines as restrictions eased and communities tried to move to a ‘new normal’. We are still yet to see what the future will look like for tourism. However, we know that recovery will likely take time and is unlikely to be smooth, but rather beset with moments of recovery and setbacks. On a positive note we know that our sector is incredibly resilient, and that the experience of travel is something that people will continue to desire now and into the future. What’s more we know that when it comes to tourism experiences, Australia has so much to offer the rest of the world.

In 2020/21, the Australian Government will deliver funding of $191.9 million to Tourism Australia. An additional $39.7 million has been authorized, bringing Tourism Australia’s total available funding to $231.6 million. This will facilitate the delivery of a strong and robust approach to ensure Australia is front of mind for consumers, in what will be an increasingly competitive environment. Importantly, we can regain our share of international visitors. Tourism Australia will be ready, alongside its industry partners, with a powerful recovery strategy to ensure a strong tourism future for Australia.

Bob East

Managing Director’s report

I never would have thought that in closing out the 2019/20 financial year, and my first nine months as the Managing Director of Tourism Australia, we as an industry would find ourselves grappling with the most significant disruption to have occurred in our lifetimes, and an unprecedented new reality where international travel to Australia was effectively nil.

As we approached the closing months of 2019, we had started to see our growth moderate after almost a decade of record figures, but we were still on-track for another record year as an industry, and in a strong position as an organisation.

In October 2019, we launched our refreshed brand platform, which sought to elevate one of Australia’s greatest attributes – our way of life and people. This set the scene for a big, bold activation in the UK, where change and uncertainty had impacted on consumer confidence and recent travel numbers to Australia. On Christmas Day 2019, right before the Queen delivered her annual Christmas message, we launched our Matesong campaign – a fun, musical message delivered by Kylie Minogue that celebrated the longstanding ties and sense of mateship that exists between Australia and the UK. In the same way that our bold Dundee campaign invigorated the US market, we were confident that this idea would deliver a big impact in the UK.

However, shortly after its launch and in light of the worsening bushfire crisis, we made the difficult decision to pause Matesong in early January, along with all other international brand campaign activity. The results achieved in the short time that the campaign was live exceeded our expectations, generating significant press coverage and highlighting that we had hit the right tone with the UK audience.

Faced with the bushfire crisis, which was a significant blow to the tourism industry in the peak summer travel period, we were quick to mobilise with a domestic-focused Holiday Here This Year campaign, launched just four days after the government announced a $61 million funding boost for Tourism Australia as part of its recovery efforts. Significantly, this represented the first domestic marketing campaign undertaken by Tourism Australia since 2013 and saw us working closely with our state and territory tourism partners to coordinate an effective, unified national marketing response. Unfortunately, just weeks later, we had to hit pause on our marketing activities yet again due to the escalating global COVID-19 crisis.

With the future of international travel to Australia still unclear, Tourism Australia will be maintaining a presence in the domestic market in the short to medium term, while continuing to gauge how and when we ramp up our international marketing activities. Crucial to our recovery strategy is ensuring that as a destination brand we maintain an appropriate presence, because brands that continue to engage with their audiences in a crisis that tend to recover the fastest. It was this sentiment that underpinned our Live from Aus campaign in May 2020, which highlighted that even though people couldn’t travel, there was still huge appetite for inspiration to help them dream about their next holiday.

The campaign’s success was in part due to the extensive research and consumer insights that informed its timing and tone, and this will play an important role in guiding our strategy as we market in this new world. While we do not yet truly know what travel will look like in the future, we are beginning to see some trends emerge in terms of consumer priorities and sentiment. Physical distancing and hygiene will certainly be key issues for the travel industry to navigate, while a desire among travellers to seek out less crowded attractions and destinations and nature-based experiences is also likely. Fortunately, our outdoor lifestyle, spectacular nature, clean air, wide open spaces and reputation for safety will stand us in good stead as the world starts to travel again.

I would like to take this opportunity to extend my deepest gratitude and best wishes to our industry partners and operators, and every member of our tourism industry. The combined impacts of the summer bushfires followed by the COVID-19 crisis have been exceptionally challenging and, for many, nothing short of devastating. But our industry has proven itself resilient in the face of crisis and, as we continue together on the path of rebuilding, I am hopeful that the new strategies and foundations that we are putting in place now, ensure that in time we emerge as a stronger industry than before.

Pip Harrison

[1] Austrade, Australia Benchmark Report, October 2019