Markets are adjusting to the new normal – long-haul demand in short supply.
HONG KONGHong Kong received more than 12.6 million visitors in the second quarter of 2013, reflecting a 13.7% year-on-year (YOY) growth from 2012. The mainland Chinese market accounted for 73.8% of total visitor arrivals, registering YOY growth of 21.2% – the highest in the market.
Similarly, the Russian market continued to experience robust YOY growth, posting the second highest increase in the market at 17.3%. Growth was fuelled by the synergies created by active promotional efforts by the Hong Kong Tourism Board (HKTB), such as the launch of the first Russian-language Hong Kong travel guide, as well as increased flight capacity.
Among the top five source markets, only mainland China and Japan recorded positive YOY growth, with the Japan market slightly recovering by 2.0%.
Given the volatile economic situation, the US market decreased by 22.2% YOY, while the South Korean and Taiwan markets contracted by 9.6% and 1.8% YOY, respectively.
On the brighter side, the Thailand market continued to expand, growing by 8.0% YOY mainly due to the appreciation of the Thai Baht. The European market, meanwhile, grew by a slight 2.6%.
Among Oceania markets, Australia and New Zealand declined by 4.0% and 2.4% YOY, respectively.
The share of total overnight visitor arrivals declined from 48.9% in the second quarter of 2012 to 47.3% over the same period in 2013. More mainland Chinese visitors stayed overnight, with numbers increasing by 18.8% YOY.
According to the HKTB, this growth is mainly attributable to the increasing number of mainland Chinese visitors who come to Hong Kong for a vacation, from both Guangdong and other provinces.
The Thailand market also recorded a 14.6% YOY in overnight visitor arrivals, due to the increased spending power of Thai travellers.
On the other hand, South Korean and Japanese overnight visitor arrivals dropped by 10.4% and 12.3% YOY, respectively, compared to the same period last year. The number of South Korean and Japanese visitors to Hong Kong is expected to decline throughout 2013 due to the depreciation of their respective currencies and the vigorous tourism promotions of neighbouring cities.
For instance, Thailand launched products with pricing strategies that aimed to capture more price-sensitive visitors amid the uncertain economic environment.
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About Daniel J Voellm
Daniel J. Voellm is Managing Director of HVS Hong Kong and has provided advice in major markets across Asia-Pacific. Prior to heading the Hong Kong office, Dan was Vice President at HVS' global headquarters in New York conducting a wide range of appraisals, market studies and underwriting due diligence services. Dan brings a strong understanding of the hospitality industry to HVS. His experience in hotel and food and beverage operations in Germany, Switzerland, England and the United States is complemented by an Honours Bachelor of Science Degree from Ecole hôtelière de Lausanne in Switzerland. Dan works closely with key institutional and private owners of hotel properties, financiers, developers and investors. Dan further advises on property and concept development and strategy.
About PuReaNae Jang
PuReaNae Jang is an analyst of HVS Hong Kong, working primarily on hotel consulting assignments including Market Studies and Feasibility Studies in the Asia Pacific region. Graduating with an Honors Bachelor of Social Science degree from the Hong Kong Polytechnic University and with previous working experiences in hotel operations, PuReaNae brings a comprehensive knowledge of the hospitality industry.
