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Research suggests backpacker industry ‘in crisis’

Australia’s backpacker industry is ‘in crisis’, according to new figures from Tourism Research Australia.   

The number of people staying in hostels has decreased by nearly seven percent in the year ending March 2012 in every state in Australia, according to an article in The Herald Sun.

There was also a 20 per cent fall in backpackers from the UK – Australia’s largest source market – since 2010.

A number of factors have been blamed for the decline, such as the strong Australian dollar, global economic uncertainty, increased competition from cheap Asian destinations, unpredictable weather and tight regulations.

Brendan McKenna from Base Backpackers said, “Sydney is very quiet… If Sydney is empty it is very worrying.”

This decline is expected to have lasting effects on the future of the tourism industry in Australia.

By James Besanvalle  ·  August 8th, 2012 at 5:21 pm

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Comments


  1. Tony
    9 Aug 12
    9:10 am

    2. From what I’ve seen unfold since 2010 in and around my neck o’ the woods, I can’t help but agree with Brendan’s comment in the Sun article that “The industry feels overlooked.”

  2. Macca
    9 Aug 12
    12:21 pm

    3. One of the biggest crisis is that State, Federal and local Governments do not take the backpacker industry serious enough and what it contributes.

    We can not get them to stamp out illegal operators in these tough times.

  3. anon
    9 Aug 12
    2:09 pm

    4. “A number of factors have been blamed for the decline, such as the strong Australian dollar, global economic uncertainty, increased competition from cheap Asian destinations, unpredictable weather and tight regulations”

    It is all well and good blaming these things but don’t forget about the lack of “tourist-friendly” road signs. Don’t worry though Scotty has that one under control so we should seem a rise in numbers soon once word of these road signs gets around.

  4. Paul
    9 Aug 12
    6:08 pm

    5. Did they really need to do some research on this? Maybe just attend some of the trade events and talk to the people at the coal face would have been much simpler and cheaper! I guess they just needed to reaffirm what everyone has been telling them.

    One of the key factors for the decline has not even been mentioned though – product quality! Too much of a can of worms I guess and not one they would want to publicly announce.

    Certain points raised on Current BTN forum debates such as: ATA, AAT, Wayoutback, Selling at cost, Commissions and Customer service, all tie into this most important factor.

    As we have seen over the years, businesses come and go, mergers take place and ‘offloading’ is a common practice: business is business and all these things are necessary evils of survival. But unfortunately the end results are not always the best outcome.

    I could rattle off numerous examples, but one recent scenario highlights my point (and whilst it is not specifically backpacker related it is a good example of the issue). I recently had some clients express their disappointment to me regarding the fact that they had booked some tours with an Australian owned family run business that had looked after them over the years. To their dismay, upon reaching Darwin, they were picked up by Another multi national company for all their touring and subsequently endured all the hassles they had the last time they travelled with them.

    In this case, they had not been informed about any alternate carrier and simply seen themselves as a commodity and suggested they probably would not have booked if they knew this would occur.. Scenarios like this occur everyday and irrespective of the quality of the product, how these situations are managed plays a large role in customer satisfaction levels and ultimately the positive word of mouth needed.

    Whilst most of the factors listed in the article could have an impact if things were to turn around, Operators and Agents need to become far more transparent and honest with their clients to improve customer satisfaction levels. Backpackers in particular are simply sick of being funneled through multi national conglomerates by travel agent chains and not having much of a choice.

  5. Jeff H
    15 Aug 12
    3:35 pm

    6. When Tiger Airlines stopped flying Melb to Alice Springs, it really hurt. Budget flights into Darwin with Budget links to Alice Springs and Melbourne or Sydney will re-open the circuit for Backpackers—-Right now it`s just too expensive

  6. Juan
    16 Aug 12
    9:13 am

    7. Apart from all the reasons already mentioned above, I still remember all those stakeholders chasing Vanpackers out of their cities, when instead they could have came out with a solution: a nice, friendly and value for money product for budget travellers.

    Anyway I would not call this as a crisis but a new challenge!!!

    Juan Lopez
    an ex-vanpacker in OZ.
    Master in tourism.

  7. Tony
    16 Aug 12
    10:42 am

    8. G’day Juan. I thought we DID have “nice, friendly and value for money product for budget travellers” called… hostels.

    ;-)

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