$ bn. $1.2bn total spend. 196,800 arrivals. 11.8m total nights. 3.2m dispersed nights 1. South Korea Market Profile

South Korea Market Profile In 2012, South Korea was Australia’s eighth largest inbound market for visitor arrivals, sixth largest market for total ex...
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South Korea

Market Profile In 2012, South Korea was Australia’s eighth largest inbound market for visitor arrivals, sixth largest market for total expenditure and fourth for visitor nights. It was also the sixth largest market for total dispersed nights1 during 2012. Findings from Tourism Australia’s recent international tourism research project2, indicate that when selecting a holiday destination South Korean visitors are wanting (in order of importance): a safe and secure destination, value for money, a family friendly destination, natural beauty, and good food and wine. Compared to other out of region destinations, Australia ranks very highly for family friendliness, natural beauty and interesting local wildlife. The research shows that Australia delivers a positive holiday experience that exceeds the expectations of South Korean visitors. The latest forecast by the Tourism Forecasting Committee (TFC), released in October 2012, estimates that arrivals from South Korea will decline 1 per cent in 2012/13 and rebound to increase 2 per cent in 2013/14, with a 2 per cent annual compound growth rate expected between 2011/12 and 2016/17.

$2.8 - 3.4bn Potential for the South Korean market to be worth by 2020 (Tourism 2020)

$1.2bn

total spend

Total spend from South Korea in 2012 (down 4 per cent on 2011)4

196,800

arrivals

South Korean visitor arrivals in 2012 (down 0.6 per cent on 2011)5

11.8m

Key airlines and share of passengers in 20123

total nights

Korean Airlines

South Korean visitor nights spent in Australia in 2012 (down 8 per cent on 2011)4

20%

Asiana Airlines Cathay Pacific Airways

35%

3%

Qantas

7%

Singapore Airlines Other

dispersed nights1

South Korean visitor nights spent outside gateway cities in 2012 (down 10 per cent on 2011)4

10%

Table includes direct and indirect capacity

3.2m

25%

Australia ranks

10th

among all out of region outbound destinations for South Korean travellers6

Visitor profile in 2012 33% repeat visitors4 73% of total arrivals are for leisure5 15-29 years largest demographic5 $6,742 average spend4 65 nights average stay4 Jun-Jul and Dec-Feb peak booking period Jul-Aug and Nov-Mar peak travel period

Sources: 1. Dispersed nights refer to nights spent outside gateway cities of Sydney, Melbourne, Brisbane and Perth 2. Tourism Australia, Australian Consumer Demand Research, conducted by BDA Marketing Planning, 2012

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South Korea Market Profile April 2013

In this Market Profile • Market Performance • Consumer Research • Aviation Landscape • Distribution • Find More Information

3. Department of Immigration and Citizenship (Aviation) 4. International Visitor Survey (Tourism Research Australia) 5. Australian Bureau of Statistics, Overseas Arrivals & Departures 6. Tourism Economics, Tourism Decision Metrics

South Korea

Market Performance 1.1 Arrivals trends History of Visitors from South Korea into Australia Source: Australian Bureau of Statistics, Overseas Arrivals & Departures

300,000

Total Arrivals per Year

250,000

200,000

150,000

100,000

50,000

0 Dec80

Dec84

Dec88

Dec92

Dec96

Dec00

Dec04

Dec08

Dec12

>> In 2012, South Korea was Australia’s eighth largest inbound market for visitor arrivals. >> Arrivals to Australia dropped sharply following the Asian Financial Crisis in 1997. Other events to impact outbound travel in the last decade have included the outbreak of SARS in Asia, influenza outbreaks, and the Tohoku earthquake and tsunami in 2011. >> Due to these events, arrivals to Australia from South Korea have fluctuated over the last decade, flattening out any overall growth or declines. >> The availability of the Working Holiday Visa to South Koreans since 1995 has helped drive youth arrivals.

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South Korea Market Profile April 2013

South Korea

Market Performance 1.2 Australia’s market share7 Australia’s market share of South Korean outbound travel >> Outbound travel from South Korea increased in 2012 to 13.6 million trips, up from 12.7 million trips in 2011. >> Australia’s share of South Korea’s total outbound travel has declined from 2.4 per cent in 2002 to 1.3 per cent in 2012.

South Korea: Total Outbound & Australia's Market Share Source: Tourism Economics (Tourism Decision Metrics)

6,084 2.64%

7,123 2.43%

7,086 2.68%

8,826 2.20%

10,080 2.27%

11,610 2.06%

13,325 1.74%

11,996 1.67%

9,494 1.74%

12,488 1.57%

12,731 1.42%

13,572 1.33%

10,000

2.0%

0

0.0% 2001

2002

2003

2004

2005

2006

Total Outbound (000s)

2007

2008

2009

2010

2011

2012 (f)

Australia's Share of Total Outbound (%) Note: 2012 is a forecast value

Top five outbound destinations from South Korea >> In 2012, the top five outbound destinations from South Korea were China, Japan, the USA, Thailand and the Philippines. >> Australia ranked 15th among all outbound destinations in 2012, slipping one position from 2011. Trend of Top 5 Outbound Destinations from South Korea Source: Tourism Economics (Tourism Decision Metrics)

6,000

Outbound Travellers (000s)

5,000

4,000

3,000

2,000

1,000

0 China

United States

Japan 2001

Thailand 2012

Note: 2012 is a forecast value

7. Figures for 2012 in this section are based on forecast data, last updated 14 February 2013

3

4.0%

South Korea Market Profile April 2013

Philippines

Australia

Market Share (%)

Outbound Travellers (000s)

20,000

South Korea

Market Performance Australia’s market share of out of region travel >> Out of region travel from South Korea excludes travel to North East Asia. >> Out of region travel from South Korea doubled to 7.5 million trips in 2012, from 3.8 million trips in 2002. >> Australia’s share of South Korea’s total out of region outbound travel has declined from 4.5 per cent in 2002 to 2.4 per cent in 2012.

South Korea: Out of Region Outbound & Australia's Out of Region Market Share Source: Tourism Economics (Tourism Decision Metrics)

3,514 4.56%

3,815 4.54%

3,791 5.02%

4,597 4.22%

5,181 4.41%

6,164 3.87%

6,631 3.50%

6,039 3.31%

4,756 3.48%

6,305 3.11%

7,123 2.55%

7,500 2.40%

5,000

6.0%

3.0%

0

0.0% 2001

2002

2003

2004

2005

2006

Total Outbound (000s)

2007

2008

2009

2010

2011

2012 (f)

Australia's Share of Total Outbound (%) Note: 2012 is a forecast value

Australia’s competitor destinations from South Korea >> In 2012, the top five destinations for South Korean travellers, outside North East Asia, were the USA, Thailand, the Philippines, Vietnam and Cambodia. >> Australia’s ranking among out of region destinations slipped one position to 10th in 2012. Trend of Top 5 Out of Region Outbound Destinations from South Korea Source: Tourism Economics (Tourism Decision Metrics)

Outbound Out of Region Travellers (000s)

1,400

1,200

1,000

800

600

400

200

0 United States

Philippines

Thailand

Note: 2012 is a forecast value

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South Korea Market Profile April 2013

Vietnam 2012

2001

Cambodia

Australia

Market Share (%)

Outbound Out of Region Travellers (000s)

10,000

South Korea

Market Performance 1.3 Visitor arrivals by age and purpose of visit Analysis of visitors from South Korea in 2012 >> In 2012, the majority of arrivals from South Korea visited Australia for Leisure purposes, with Holiday representing 60 per cent of total arrivals, and Visiting Friends and Relatives (VFR) representing 13 per cent. >> The largest age demographic was 15 to 29 years, representing 34 per cent of total visitors. >> Of total Business arrivals from South Korea in 2012, there were 7,610 convention/conference visitors.

Visitors from South Korea by Age and Purpose of Visit for 2012 Source: Australian Bureau of Statistics, Overseas Arrivals & Departures

Holiday 119,020 (60%)

Visit Friend/ Relatives 26,440 (13%)

Business 16,240 (8%)

Education 18,000 (9%)

Employment 4,680 (2%)

Other 12,370 (6%)

70,000

60,000

Total South Korea 196,750 (100%) + -

Total Number of Visitors

50,000

40,000

30,000

20,000

10,000

0 Under 15yrs 14,430 (7%)

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South Korea Market Profile April 2013

15 to 29yrs 66,150 (34%)

30 to 44yrs 55,150 (28%)

45 to 59yrs 44,100 (22%)

60yrs & over 16,920 (9%)

South Korea

Market Performance Age demographic of visitors from South Korea for 2002-2012 >> Since 2005, the 15 to 29 years age demographic has been the largest visitor segment out of South Korea, despite recent declines. >> Arrivals by visitors aged 30 to 44 years have remained fairly resilient in the past three years and grew slightly in 2012.

South Korea: Visitor Arrivals by Age for 2002-2012 Source: Australian Bureau of Statistics, Overseas Arrivals and Departures

90,000

Under 15 yrs

Total number of visitors

80,000 15 to 29 yrs

70,000 60,000

30 to 44 yrs 50,000 40,000

45 to 59 yrs

30,000 60 yrs & over

20,000 10,000 2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

Visitor segments from South Korea for 2002-2012 >> The Holiday segment has remained the largest visitor segment out of South Korea for the past decade, peaking in 2006. >> The VFR segment has shown resilience over the years, recording 4 per cent growth in 2012 and similarly has achieved 4 per cent annual compound growth between 2002 and 2012.

South Korea: Visitor Arrivals by Purpose of Visit for 2002-2012 Source: Australian Bureau of Statistics, Overseas Arrivals and Departures

200,000 Holiday

Total number of visitors

180,000 160,000

Visit Friends/Relatives

140,000 120,000

Business

100,000 80,000

Education

60,000 Employment

40,000 20,000

Others

2002

6

2003

2004

South Korea Market Profile April 2013

2005

2006

2007

2008

2009

2010

2011

2012

South Korea

Market Performance 1.4 Spend by age and purpose of visit Breakdown of spend by visitors from South Korea for 2008-2012 >> On average from 2008 to 2012, the largest spending segment was Holiday visitors, representing 44 per cent of total spend. This was followed by Education, representing 29 per cent. >> The largest spending age group was 15 to 29 year olds, representing 60 per cent of total spend by South Korean visitors.

Spending by Visitors from South Korea by Age and Purpose of Visit for 2008-2012 Source: International Visitor Survey (Tourism Research Australia)

Holiday $565,852 (44%)

Visit Friend/ Relatives $105,462 (8%)

Business $74,648 (6%)

Employment $54,180 (4%)

Education $373,883 (29%)

Other $98,788 (8%)

$900,000

Total South Korea $1,272,813 (100%)

$800,000 + $700,000

Total Spend by Visitors (A$ 000s)

$600,000

$500,000

$400,000

$300,000

$200,000

$100,000

$0 Under 15yrs Not covered by the IVS

15 to 29yrs $764,863 (60%)

Note: Data in graph refers to an average of 2008-2012

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South Korea Market Profile April 2013

30 to 44yrs $284,916 (22%)

45 to 59yrs $167,896 (13%)

60yrs & over $55,138 (4%)

South Korea

Market Performance Spend by age group from South Korea visitors for 2002-2012 >> Visitors aged 15 to 29 years have consistently spent more money in Australia over the past decade than any other age group, despite recent declines. >> Spend across all age groups (excluding 15 to 29 years) increased in 2012.

South Korea: Visitor Spend by Age for 2002-2012 Source: International Visitor Survey (Tourism Research Australia) $900,000 15-29 yrs

$800,000

Total Spend (A$ 000s)

$700,000 30-44 yrs

$600,000 $500,000 $400,000

45-59 yrs

$300,000 $200,000

60 yrs & over

$100,000 $2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

Spend by purpose of visit segments for 2002-2012 >> Consistent with arrivals numbers, the largest spending segment over the past decade has been the Holiday segment despite recent declines. Holiday spending peaked in 2007, before sliding during the Global Financial Crisis. >> Spending by the VFR, Business and Employment segments increased in 2012.

South Korea: Visitor Spend by Purpose of Visit for 2002-2012 Source: International Visitor Survey (Tourism Research Australia)

$800,000

Holiday

$700,000

Total Spend (A$ 000s)

$600,000

Visiting Friends/Relatives

$500,000 Business $400,000 Education

$300,000 $200,000

Employment

$100,000 Others

$2002

8

2003

2004

South Korea Market Profile April 2013

2005

2006

2007

2008

2009

2010

2011

2012

South Korea

Market Performance 1.5 Visitor profiles for spend and nights Average visitor

Spend per trip $6,812 Stay 66.4 nights Spend per night $103

Purpose of visit

Holiday

Spend per trip $4,993 Stay 47.4 nights Spend per night $105

Visiting Friends and Relatives

Business

Spend per trip $4,527 Stay 34.6 nights Spend per night $131

Spend per trip $4,987 Stay 18.5 nights Spend per night $269

Other (including education and employment)

Spend per trip $14,934 Stay 169 nights Spend per night $88

Age groups

15 to 29 years

30 to 44 years

45 to 59 years

60 years & over

Spend per trip $9,944 Stay 126.3 nights Spend per night $79

Spend per trip $5,350 Stay 36 nights Spend per night $149

Spend per trip $4,133 Stay 14.9 nights Spend per night $277

Spend per trip $3,434 Stay 11.2 nights Spend per night $307

International Visitor Survey (Tourism Research Australia) Note: Data refers to an average of 2008-2012

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South Korea Market Profile April 2013

South Korea

Consumer Research In 2012, Tourism Australia undertook a major international tourism research project8 into how global consumers view Australia and what most motivates them to visit, identifying the ‘triggers’ and experiences important to the consumer when selecting a holiday destination. The research involved 13,389 consumers across 11 markets, who have travelled long haul in the past two years and/or plan to travel long haul in the next few years. The results below refer to the responses of South Korean consumers.

2.1 What travellers from South Korea want in a holiday destination Participants were asked what they look for when choosing any holiday destination. The graph below outlines the top five considerations of South Korean respondents.

Korea

Their key considerations are: safety and security, value for money, family friendliness, natural beauty, and good food and wine.

South Korea: Top 5 Importance Factors A safe and secure destination

60

A destination that offers value for money

57

A family friendly destination

48

World class beauty and natural environments

45

Good food, wine, local cuisine and produce

35

Romantic destination

34

Rich history and heritage

31

A range of quality accomodation options

28

Clean cities cities, good road infrastructure with clear signposts

21

Spectacular coastal scenery

20

Friendly and open citizens, local hospitality

19

Native or cultural heritage or activities

15

Great shopping h / world ld class l b brand d names

13

Luxury accommodation and facilities

13

Ease of obtaining visa

11

Flights with no stop-overs

9

Great swimming beaches

9

Different and interesting local wildlife Good leisure activities such as nightclubs/bars and/or casinos

8 6

Read as: 60 per cent of South Korean respondents ranked ‘a safe and secure destination’ in their top five considerations when choosing a destination

8. Tourism Australia, Australian Consumer Demand Research, conducted by BDA Marketing Planning, 2012

10

South Korea Market Profile April 2013

South Korea

Consumer Research 2.2 Associations with Australia For South Korean respondents, Australia is known for having beautiful natural environments. Generally, many importance factors for South Korean respondents had a low association with Australia, which presents opportunities for the destination to build awareness. Compared to other out of region destinations, Australia ranks highly (first, second or third) for family friendliness and natural beauty.

2.3 Opportunities for Australia highlighted by the research The research shows that Australia delivers a positive holiday experience that exceeds the expectations of South Korean visitors. This was particularly clear for their perception of Australia’s safety and security, offering value for money and being a family friendly destination. Despite unfavourable exchange rates, South Koreans who had visited Australia perceived their experiences delivered value for money. Noting that ‘value’ was not defined during the research and is considered a subjective term. Likewise for the perception of safety and security and family friendliness, South Korean respondents who have visited Australia ranked the country much higher than those respondents who had not been. Given the importance placed on these considerations by South Korean respondents, this presents future opportunities to improve upon their perception of Australia.

2.4 Preferred Australian experiences South Korean respondents prefer experiences in Australia which include wildlife (both aquatic and non-aquatic), coastal or harbour settings and/or cities. Compared to the average across other markets in the research, South Koreans differed by ranking cities in their top preferences.

11

South Korea Market Profile April 2013

South Korea

Aviation Landscape 3.1 Summary >> Limited aviation growth to Australia from South Korea has occurred in the past 10 years, with capacity declining in 2012. >> The South Korean market is highly seasonal, with carriers increasing and reducing capacity in line with seasonal demand. During peak travel times in December and January, average airfares increase significantly and seats are very limited.

Seoul

Hong Kong

Brisbane

>> Through-traffic from North Asia and Europe can also impact seat availability for South Koreans travelling to Australia. >> South Korean Air and Asiana Airlines are the key carriers on the route, with direct services from Seoul. As of early 2013, there are no longer direct services from Seoul to Melbourne, following South Korean Air’s suspension of the service. >> Qantas recently announced its Asian strategy which mentioned Seoul as a potential destination for the deployment of the airline’s B787-900 orders, due for delivery from 2016.

Sydney Auckland

Operating Airlines

Flights per week

Route

Korean Air

7

Seoul-Sydney

5-6

Seoul-Brisbane

3-->0

Seoul-Melbourne

7

Seoul-Sydney

Asiana Airlines

Alliance/Codeshare partner (on route)

Qantas, Air NZ, Turkish Airlines

Source: Innovata, Northern Summer Scheduling Season (31 March 2013 to 26 October 2013) Note: Table includes direct services to Australia only

Key airlines and share of passengers

20% 35%

3% 7% 10% 25%

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South Korea Market Profile April 2013

Airline Korean Airlines Asiana Airlines Cathay Pacific Airways Qantas Singapore Airlines Other Table includes direct and indirect capacity

2008 33% 20% 8% 11% 4% 24%

2009 37% 24% 10% 7% 2% 20%

2010 36% 23% 10% 9% 2% 20%

2011 34% 24% 12% 10% 2% 18%

2012 35% 25% 10% 7% 3% 20%

South Korea

Aviation Landscape 3.2 Trends Capacity >> In 2012, capacity from South Korea to Australia declined four per cent, with both Korean Air and Asiana Airlines reducing capacity. Capacity is expected to decline a further five per cent in 2013 following the withdrawal on Korean Air’s Melbourne service. >> Australia has lost significant market share of aviation capacity out of South Korea compared to similar haul destinations in recent years. New Zealand has also experienced similar declines to Australia, while there has been very strong growth to the USA and Canada as well as Asian destinations such as the Philippines and Thailand. Capacity from South Korea to Australia vs competitor destinations Source: Innovata; Department of Infrastructure and Transport Forecasts

l l l

Thailand - Up 28.3%

l

Philippines - Up 12.1%

l

Vietnam - Up 20.3%

l

2.5

United States - Up 10.8%

Singapore - Up 18.1%

l

3.0

Australia - Down 4.2%

Canada - Down 11.7%

l

Seats per year (000s)

3.5

New Zealand - Down 8.3%

2.0 1.5 1.0

l

0.5 0.0 Dec-07

Dec-08

Dec-09

Dec-10

Dec-11

Dec-12

Dec-13

Note: Chart includes direct capacity only and above percentages reflect change in direct capacity from 2011 to 2012

Average loads >> Load factors or seat utilisation is the ratio of passengers carried to the number of seats available, expressed as a percentage. >> As capacity declined in 2012, average load factors increased from 73 per cent in 2011 to 79 per cent in 2012. The number of Australians travelling to South Korea increased five per cent, whereas South Korean visitors to Australia were down 0.6 per cent in 2012. >> Despite average loads increasing, the South Korean market remains highly seasonal. Average loads tend to be softer during March to June and higher during Australian school holidays (January/February, July and October). Loads and seasonality in 2012 South Korea to Australia 100%

Jan

Feb

Mar

Source: Department of Infrastructure and Transport

Apr

Monthly load factors

95% 90%

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Low seat availability

85% 80% 75%

Sustainable seat availability

70% 65% 60%

Note: Chart includes direct capacity only

13

May

South Korea Market Profile April 2013

High seat availability

South Korea

Distribution 4.1 Distribution system The South Korean travel distribution system is complex, with consumers using a combination of traditional and online channels to plan and book travel. There is no formal distinction between wholesalers and retail agencies. The outbound travel market for Australia consists of around 30 per cent group travel and 70 per cent Free Independent Travel (FIT).

Wholesalers/ Large Agents

Retail Agents

Commission Level: 5% to 12%

Commission Level: 9% to 20% for major travel agencies only.

>> The South Korean system does not formally distinguish between wholesalers and retail agencies. >> Hanatour, the largest wholesale agency, has diversified the number of Inbound Tour Operators (ITOs) it works with and no longer has exclusive contracts with select ITOs. >> Hanatour also has a strong FIT brand/ business unit called Hana Free. >> Hanjin/Kal Tour, a subsidiary of Korean Air, has shifted its business model from retail to wholesale. Special Interest >> Luxury travel is growing in the South Korean market, especially in the older age demographic. Two large wholesalers, Hanatour and Mode Tour Network, have dedicated divisions dealing with luxury products, named Zeus and Jewellery Mode. Korean Air’s affiliated travel agent, KAL Tour, uses KALPAK for luxury products. Jason Travel is specialised in high-end honeymoon products. >> Major credit card companies also provide cardholders with travel services including high-end packages. >> There are three key agents specialising in trekking, including Hyecho, Himalaya and Green.

>> There are two types of overseas travel agencies in South Korea: General Travel Agencies (GTAs) handling both inbound and outbound travel, and Overseas Travel Agencies, handling outbound travel only. >> There are approximately 1,655 GTAs and 5,300 Overseas Travel Agencies nationwide however, the GTAs are the most influential agencies for outbound business. >> Among both types of agencies, the top five group travel agencies manage approximately 25 per cent of total travel Australia. Top five agencies in terms of volume are Hanatour, Mode Tour networks, Feedom Tour, Lotte Tour and Verygood Tour. >> There are some active FIT agents in South Korea, such as Naeil Tour, Tour Express, Interpark, Blue Travel, IOS, Saegaero and Webtour, who develop customised FIT packages. >> FIT agents handle a marginal level of business to Australia compared to the total number of South Korean visitors, with many FIT travellers booking directly online. Online

Commission Level: 8% to 10% >> All major travel agencies have an online presence, however the number of direct consumer enquiries and visits to offline agents is still high. >> Interpark has a high percentage of online-only business. Aussie Specialists >> The Aussie Specialist Program is the primary platform for Tourism Australia to train and develop retail agents to sell Australia. >> As at March 2013, there were 353 qualified Aussie Specialists in South Korea and a further 903 agents in training.

14

South Korea Market Profile April 2013

Inbound Tour Operators

Commission Level: 5% to 10% >> ITOs provide a vital link between Australian product and South Korean group travel agents, with about a third of business to Australia handled through ITOs. >> Most major ITOs operate offices in Seoul, however there are no set patterns in business relations between the Australian and Seoul offices. >> Many ITOs deal with consumers directly through their websites for FIT, honeymoon, small group and incentive travel. >> Some ITOs assume a wholesaler role for the honeymoon market, particularly in regional cities of South Korea. >> Key ITOs located in Sydney and the Gold Coast include: Blue Sky Tours, OZ World Travel (formerly Hana Tours Australia), Hoju Tour (formerly Harbour City International), Honew Tours, I Tour, New Line Tours, OZ Korea Travel, Royal Holiday Travel, S.S.K Travel (HIHOJU), Win Hanaro Tour, Wonderful Pacific, Paran Travel and Good Memory Tours. >> Key ITOs in Seoul include: Newline Tours, Honew Tour, Key World, Road Tour and Travel, I Travel, Australia Tour, Paran Travel, Tour TTL, Wonderful Pacific, Oceania Tour and OTT. Business Events >> Major agents that specialise in business events include: BT&I, Sejoong Travel, Global Tour, Sharp Travel, BCD Travel, Redcap Tour and Hana Business Travel. >> Many incentive groups tend to travel as Leisure groups, with an additional component such as a gala dinner added to the program.

South Korea

Distribution Brochures and rates

Brochure Validity >> Ad hoc basis Brochure Space Policy

>> Not applicable in this market

Setting Rates

>> Rates are usually set during the first week of the month and then applicable for next three months

Standard Rate Validity Periods

>> Standard Rate Validity Periods »» Low season: April to June and September »» High season: July to August and December to March

Seasonality of Visitors from South Korea Source: Australian Bureau of Statistics, Overseas Arrivals & Departures, 2008 to 2012

Variation from Monthly Average Arrivals

70% more than the average

35%

0%

-35% less than the average

-70% Jan

Feb

Mar All Purposes Avg: 83,996

Apr

May

Jun

Jul

Aug

Nov

Business

Other

Avg: 61,302

Avg: 6,223

Avg: 16,470

>> The peak travel periods to Australia are July to August and November to March.

South Korea Market Profile April 2013

Oct

Leisure

Seasonality >> The peak booking periods for travel to Australia are June to July and December to February.

15

Sep

Dec

South Korea

Distribution 4.2 Trends Distribution >> The structure and function of distribution channels in this market is complex and changes rapidly. Consumers tend to use a combination of traditional distribution partners and online options to research and book travel. >> The FIT segment accounts for approximately 70 per cent of the total outbound market for Australia. Most FIT consumers book online while a small percentage use FIT specialised agents. >> T he number of South Korean ITOs in Australia has significantly reduced in recent years. >> Special interest travel continues to grow. Awareness of major events in Australia such as the Gold Coast Marathon and Melbourne Cup has grown in South Korea. Trekking and self-drive (campervan) are also growing in popularity.

4.3 Planning a visit to market Planning and purchasing travel >> According to findings from Tourism Australia’s Consumer Demand Research project9, South Korean respondents would use a mix of online and traditional sources when planning a trip to Australia. There is a preference for general internet searches and government tourism websites, followed by talking to family and friends who have been to Australia, using guidebooks and travel agents. The research found the use of brochures was low compared to the average across all markets. >> The lack of diversified products in the group market drives a consumer focus on price. This is the differentiating factor in the group travel segment rather than product inclusions. Group tour prices are also affected by high airfares in peak season. >> Consumers prefer South Korean language information and brochures. However, younger South Korean consumers are comfortable using English language websites for research and bookings. >> The percentage of young FIT travellers booking tourism products after arriving is increasing. >> Airlines use sales promotions to drive consumers to book airfares and travel packages online. Booking lead times are becoming shorter, approximately two to three weeks prior to departure. >> Word of mouth and online peer reviews are becoming increasingly influential in South Korea.

9. Tourism Australia, Australian Consumer Demand Research, conducted by BDA Marketing Planning, 2012

16

South Korea Market Profile April 2013

Top tips for sales calls >> The South Korean travel trade generally prefer hard copies of brochures and collateral in South Korean language. >> It is helpful to have a translator on sales calls for more effective communication. >> The South Korean travel trade value punctuality and it is a good idea to reconfirm your meeting in advance. >> Bring product information, promotional ideas and specially discounted rates. >> South Koreans value personal relationships. Persistent visits and contact can assist in this process. >> Learning and using simple South Korean words on sales calls can be a good ice-breaker during meetings. >> The best time for sales calls is March to April and October to November. >> The key market centres to visit are Seoul, followed by Busan and Taegu. >> For more general information on sales calls and planning a visit to market, please see Tourism Australia’s Planning for Inbound Success at www.tourism.australia.com/inboundsuccess

South Korea

Distribution 4.4 Key trade and consumer events Key Trade and Consumer Events

Event

Location

Date

Hana Tour Convention

KINTEX, Ilsan city

May 2013

Where to Find More Information Tourism Australia’s activities in South Korea are managed from Tourism Australia’s Seoul office. For more information visit Tourism Australia’s Corporate website at www.tourism.australia.com Australian State and Territory Tourism Organisations operating in South Korea include Destination New South Wales, Tourism and Events Queensland, Tourism Victoria and Tourism Western Australia. Also see: Republic of Korea Country Brief published by the Department of Foreign Affairs and Trade at www.dfat.gov.au/geo

17

South Korea Market Profile April 2013