NEW ZEALANDS TOURIST INDUSTRY HAS GROWING PAINS - IS AGRI-TOURISM THE ANSWER?
New Zealand’s tourism industry, the star of the local economy for the past decade, has growing pains.
International visitor arrivals for the year ending November 2016 were 3.4 million, up 12% on the previous year*. But more tourists mean a need for more visitor infrastructure and experiences to capture the imagination.
One under developed answer to this growing problem could be agri-tourism.
Imagine visiting a place where you could immerse yourself completely in the land and what it can produce, hear from the families creating world class produce, taste and experience the food cooked by local chefs over a glass of wine at the vineyard where the grapes were grown – to learn the history of a region through its people and its food.
As people increasingly want to know where their food comes from and learn about how it is produced, agri-tourism represents a huge opportunity for New Zealand – but are we missing out?
In places like Italy, where the direct contribution of travel and tourism to GDP in 2015 was EUR 68.8 billion, agri-tourism is a well-accepted part of the visitor experience. But it hasn’t happened by accident; it’s taken a conscious effort from tourism promotion agencies and the agricultural industry.
New Zealand’s vineyards, orchards, craft breweries and distilleries, honey, dairy, red meat – these are all industries where there is an opportunity for the farming and broader food and beverage sector to innovate around traditional business models and bring in additional revenue through tourism.
A quick look at the figures from ANZ’s December Agri Focus ‘Tourism and its connection to New Zealand’s countryside’ reveals just how big that opportunity could be. Tourism is now our biggest export earner with international tourist expenditure totalling $14.5 billion in the year to March 2016.
27% of those international visitors visited a farm or orchard, and 20% visited a vineyard or wine trail. In the same period, 65% of Chinese visitors stated they visited a farm or orchard – given that much of the projected growth in tourism is expected to come from China that last figure is important.
While the largest numbers are still visiting from Australia, China comes in second and the share has grown significantly over the last 10 years. And when you look at how much they spend, Australians typically spend around $2000 per person, well below the averages of Chinese ($4,750), US ($4,550) and UK ($4,900), you can see where the opportunity lies.
From a regional perspective Auckland still gets the lion’s share of tourist spend with Otago coming in second.
Sector growth means those popular areas are coming under pressure - but rather than putting a cap on industry growth, we should be focussed on a future where we attract those tourists to different parts of our country and give them more to spend their valuable tourist dollars on.
So what could that future look like? Well there is no doubt the future for tourism looks bright – the Ministry for Business, Innovation & Employment forecasts international visitor arrivals to grow by 5.4% each year to reach 4.5 million in 2022 (from 3.4 million now). Total visitor spending is also forecast to increase strongly, with forecasts suggesting it could top $16 billion in 2022 – a 66% increase from 2015’s level.
How do the farming sector and broader food and beverage industry leverage off that positive outlook for tourism? For a start, understanding the demographics, age and spending habits of our international visitors is really important – a one size fits all approach won’t work.
Innovative ideas around teaming up with other businesses to create unique experiences, like the Tora Coastal Walk in the Wairarapa, are a great example.
Over 20 years ago, two neighbours decided they wanted to create alternative income from their farms as well as sharing the natural beauty around them. Today, the three day walk across farmland has grown to include unique accommodation and the opportunity to dine on fresh local produce.
Linking with other local businesses they have created a story based on hospitality offered by the people who own and farm the land.
There is also huge opportunity to showcase the entire production process (growing, harvesting, processing etc.) and connect people directly to the food experience.
After 15 years here I consider myself a Kiwi, and when I travel back to the UK like I did this Christmas I am reminded just how lucky I am to call New Zealand home. If we get this right, tourists take the New Zealand story home with them. And with the internet, mobile apps and social media there is an opportunity for tourists to form a lasting relationship with Kiwi businesses long after they have left our shores.
GM Central Commercial & Agri, ANZ
*ANZ Agri Focus December 2016