Tourism now worth $28 billion to Victoria, but warning signs for regional Victoria’s international performance

The Victoria Tourism Industry Council (VTIC) welcomes the latest results of the International and National Visitor Surveys for year-ending September 2018 which showed that Victoria continues to outstrip the nation across many key metrics.

The performance of Victoria’s overall visitor economy hit $28 billion for the first time ever and with the litany of international major events and blockbusters over summer, tourism performance in Victoria is poised to grow even stronger.

VTIC Chief Executive, Felicia Mariani said, “The latest visitor survey results are pleasing and testament to the collective efforts of the industry. Crossing the $28 billion mark is an achievement both industry and Government can be extremely proud of.”

Spend from domestic visitors in Victoria is up nearly 10% to $14.6 billion ($8.2 billion in Melbourne and $6.4 billion in regional Victoria). Victoria also welcomed over 25 million overnight visitors from across Australia, with 16.2 million of those visits in regional areas.

“This is a terrific result for Melbourne and regional Victoria, and is directly related to the excellent marketing and events strategy that has supported the State’s domestic performance,” said Ms Mariani.

Victoria continued its year-on-year growth in overseas visitors, reaching three million international visitors to our State. International expenditure reached a record $8.3 billion, representing an increase of 8.6% compared to this time last year, which is well ahead of the national average of 5.3% and ahead of key competitor New South Wales.

Melbourne continues to do the heavy lifting, as reflected in Victoria’s strong year-on-year growth in international spend which increased 9.5% to $7.8 billion, outperforming the national capital city average growth of 6.9%.

The gap in expenditure continues to widen, with only 6.5 cents in every international dollar being spent in regional Victoria.

International overnight expenditure in regional Victoria continued to decline, falling by 2.6% year-on-year to reach $542 million. Nationally, regional spend declined at a higher rate (-3.5%).

“The worrying signs are highlighted when you compare the performance of regional Victoria to those states that are predominantly focused on regional visitation for their international performance, namely Tasmania (+7.7%), South Australia (+8.7%), Western Australia (+4.4%) and even Queensland (+12.5%), where Brisbane is not generally the major drawcard,” said Ms Mariani.

International visitors to regional Victoria decreased as well (-1.4%) to 528,300, landing well below the national regional average growth rate of +3.8%.

Also significant is the decline in overnight visitors to regional Victoria from our traditional Western markets (-6.2%), who tend to stay longer and disperse more widely.

These trends continue to be alarming signs for the performance of regional Victoria in attracting international overnight visitors. Continued quarters of decline to regional centres cannot go unheeded. When other states with predominately regional appeal continue to eclipse the performance of our regional areas, we must begin to look at the infrastructure and experiences we are offering in regional Victoria when compared to these other destinations.

“VTIC has worked closely with the regional industry and we know there is a need for improved infrastructure in the luxury end for our regional areas; better transport options to disperse our international visitors beyond Melbourne for overnight stays; and high-end guided experiences for international visitors to engage with our amazing nature-based assets.

“These are not issues that we can market our way out of and we need a comprehensive analysis that will look at the supply side issues impeding the growth and prosperity of the visitor economy in regional areas when it comes to high-yielding international markets.

“The latest results also point out the importance of diversifying marketing efforts to ensure that we are not overly reliant on any one market or geographic region. A blended portfolio of visitation is important to ensure consistent performance,” Ms Mariani said.

/Public Release.