Op-Ed: Bernie Rosenbloom
Suppose it is 1 Jan 2020, and we’re pouring over the Tourism Development Department’s “2019 Statistical Report on Tourism in Laos”. At a glance, Laos has plenty of reasons to smile. Arrivals jumped 14% to 4,791,065, revenue surged ahead 15.2% towards USD 1 billion, and Green Season is soaring. However, where visitors get their information seems muddled.
Lao tourism had been rebounding after a dismal 2015-17. The 2019 numbers seemed to show the country was solidly back in the black. The last thing on anyone’s mind on New Year’s in January 2020, was that “back in the black” meant a once-in-a-lifetime Black Swan.
But we’re pretending to be in a time machine. Champagne glasses clinking, bragging about bookings, more flights coming. So, what woulda, coulda, shoulda happened to Lao tourism in 2020 without Covid?
Arrivals
That 14% visitor leap in 2019 narrowly topped the previous high of 4.7 million in 2015, but the situation isn’t necessarily more of the same: new markets, rising markets, fading markets.
Source: Tourism Development Department
According to the 2019 report, ASEAN’s share continued to slide, but remained the king of the hill with a 66.77% share on 3.2 million arrivals, up 11% from 2018. Thailand remained on top, recording a 12% rise to 2.1 million visitors, and accounting for nearly half of Laos’ annual arrivals. Vietnam ran second in ASEAN visitors with 925,000 entering for a 7% increase.
Albeit on a smaller scale, ASEAN rising stars included the Philippines (+59%), Singapore (+52) possibly due to increased flights, Cambodia (+50), and Indonesia (+48).
The ever-growing Asia Pacific market accounted for 27.5% of international arrivals, reaching 1.3 million visitors in 2019, almost twice that of 2015. All markets showed positive increases with China coming out the big winner. They finally passed Vietnam for Laos’ second largest market, topping 1 million visitors (+27%) and spending USD 207 million during Visit Lao-China Year.
Many think the Chinese number should be much higher considering their tendency to travel abroad. According to China’s National Bureau of Statistics, their citizens took some 160 million outbound trips in 2019 and spent USD 133.8 billion while overseas.
Korea ranked second in the A/P with a 17% jump to 203,191 visitors after a relatively stable five years. Added flights receive much of the credit, but lack of air traffic may play into Japan’s continued dreary performance. While the country’s arrivals crept ahead at 7%, the total only reached 41,736. The remaining A/P markets all showed double-digit increases, but on much smaller bases.
Europe and the Americas contributed just 5.5% of the market in 2019, but put in a strong performance. European arrivals climbed 10% to 182,465, but still well behind the 222,000 achieved in 2016. Still, all mainland markets showed double-digit increases (except Austria at +3% and Switzerland at -13%). However, Scandinavia shunned Laos, dropping between 19% (Denmark) and 28% (Sweden).
The Americas are coming back, soaring 20% from 69,101 to 82,652 arrivals. Canada reached 12,873 (+20%), but nowhere near the 19,000s they were hitting before the mid-decade tumble. On the other hand, the States rocketed 24% to 61,184, back to pre-2016 levels.
Revenue
In 2011, tourism development guru, Peter Semone, told the 3rd LANITH Symposium, “Today we will discuss how…to achieve one billion dollars in revenue by 2020.” His crystal ball appeared to be working, as 2019’s take was USD 934,710,409. A 2020 billion-dollar target looked doable.
But who is spending how much? Thailand looks good. They generally spend about USD 104 over a one-to-three-day visit. Vietnam puts in about USD 87 for a similar short stay. China, on the other hand unloads some USD 205 during the same time frame.
The math turns fuzzy, or extremely coincidental, when looking at Korea, the US, France, Japan, the UK, Germany, and Australia, all of whom dished out the exact same USD 663.275 during an average five-day stay, according to the report.
Source: Tourism Development Department
Decision Making
What prompts someone to choose a specific foreign destination has been relatively static, though the role of the web needs research. How much do Facebook, YouTube, and TripAdvisor-like reviews count?
“Word of Mouth” has long been the leading reason for a choice at around 40%. Filling that bucket list ranks a close second, with the “web” holding third. Deal hunters and geographic location follow. Travel agents, TV shows, magazine articles, guidebooks, etc. barely register, according to Medium.com.
Running parallel to choosing a destination is finding information about it. The Lao report claims 71% heavily rely on Twitter research. Literally unheard of. The April 2019 Business Systems Research Journal was one of a few periodicals that mentioned Twitter in “planning and studying tourist decision-making processes.”
Source: Tourism Development Department: 2014-2019
Almost every travel and hospitality business in Laos has a Facebook page, but only 11.5% of visitors polled used them in 2019, less than in previous years. How many use Twitter? According to Hootsuite, 167,000, or some 3% of the Lao population, in line with most of the planet.
In fact, Laos pretty much follows the same script as most countries. Facebook, YouTube, WhatsApp, Instagram…Laos is right there. And Twitter scrapes the bottom of the barrel.
An overview of a variety surveys and reports show each market has its own bent. Some 70% of Thailand, Laos’ cash cow, use Facebook, but Twitter sits second at about 22%. China bans Twitter, but estimates surmise 3.2 million Chinese have accounts.
In Vietnam, Facebook captures 60 million users from all ages. Instagram hauls in some 8 million, though the users are generally younger than 30 and seek inspirational and lifestyle content. Twitter lags behind with 1 million users. The rest of ASEAN would require extensive research as they’re all over the social-media-map.
Facebook only gets a fifth in the growing Korean tourism market, but they have other popular options. Meanwhile, Japan has about 45 million Twitter users to Facebook’s 28 million. Instagram nails third at 27 million.
In conclusion, Lao travel businesses should get a Twitter account and use it…just in case this 71% anomaly is true.
Seasonality
It looks like the efforts to boost Green Season have borne fruit. In 2017, July and August wallowed at under 300,000 visitors per month. September stood at rock bottom. In 2019, July and August soared to the third and fourth best months, recording more than 400,000 per month. Only November and December topped them. January and February 2019, were the losers, both sinking closer to 300,000 a month. Â Â
Source: Tourism Development Department
2020: Woulda, Coulda, Shoulda
So what if 2020 continued on the same course as 2019? What woulda, coulda, shoulda happened?
Arrivals: Chinese arrivals shoulda grown to well more than 1 million, while Thailand may have continued to experience a double-digit jump. With increase flight capacity and promotions, Singapore visitor numbers coulda closed in on 20,000 from 11,730 on the back of its 52% leap in 2019.
Korea coulda hit 220,000 visitors, while Japanese arrivals probably woulda stayed just above 40,000. Europe remains a head-scratcher at 182,465 tourists. Yes, Laos depends on its popular neighbours for access, but plenty of Grade-A DMCs offer multi-country options. A Vietnamese operator leaked a spreadsheet showing some 80% of their customers “aren’t interested” and/or “don’t have information” on Laos. The Americas coulda reached 100,000 arrivals in 2020, if the Yanks kept pouring in.   Â
Revenue: I’d have bet on Mr Semone’s 2020 forecast. It was reasonable in 2011, and Laos was knocking on the door in 2019. My money woulda also gone on China, Thailand, and Korea taking Laos way over the top. I woulda put USD 663.275 on every Western country except Scandinavian nations and Switzerland.
Decision Making: While conventional methods remain, the web throws everything off. Hootsuite did a great job on overall use, but try finding case studies on what people in what countries use what social platform for main travel decisions, and why. NTO and DMO websites seem reasonable for information. Social platforms seem like sloppy research. Facebook, like a friend’s scrapbook, gets a pass. YouTube is currently hot, but social media is fickle. Instagram sank. Many say it didn’t deliver on expectations. But now, Lao visitors are racing to Twitter.
Seasonality: Branding the rainy season as Green Season vaulted low season into high season in just three years. In fact, there are no seasons based on arrivals, though January and February could use some help because it’s cold. Skiing with ethnic groups in Phongsaly?
Back to reality and the 2020 dud. Plenty of local experts have opinions on how 2021 will pan out. As Crowne Plaza Vientiane General Manager Patria said, it’s really just a guess.
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