Bali Studies

Tourism desperately needs new brand image to recover

TOURISM DESPERATELY NEEDS NEW BRAND IMAGE TO RECOVER
The Jakarta Post, August 10th 2006

On Aug.14, Bali province, Indonesia's prime tourist destination, will commemorate its 48th anniversary. The province is currently facing challenges in revitalizing its sluggish tourism business. The Jakarta Post's Rita A. Widiadana talked to a number of key industry players.

The image of Bali as a "paradise island" and "island of the gods" is wholly inappropriate under the current circumstances.

These romanticized, utopian views were created long ago by pioneering visitors who saw the island's "virginity," characterized by an unspoilt natural environment, exotic culture and rich tradition.

With bombings in October 2002 and 2005, security and health problems (including rumors of the spread of SARS and, most recently, avian flu), as well as environmental and social degradation, it is indeed difficult to continue branding Bali as a safe haven for tourists and a top holiday destination.

If you need further proof of this, visit a travel agency in Japan or in one of big cities in neighboring Australia, once Bali's largest inbound markets.

A number of top people in Bali's tourism and hospitality industry were curious. They visited travel agencies in some Australian cities, asking whether Bali holiday packages were available as no posters or brochures were to be seen at their offices.

Only a few years ago, large, attractive posters and glossy brochures on Bali were on view everywhere in Australia.

Suddenly, all the information on Bali disappeared. "Yes, we still have that package," said a travel agency employee while reluctantly taking out a small brochure from her locker.

"Holidaymakers here have started to abandon Bali for other destinations in Malaysia, Thailand, Fiji and other interesting places in the Pacific islands," she said, somewhat flatly.

Back in Bali, hoteliers confirmed the downturn in the Australian market, which formerly accounted for more than 50 percent of the one million tourists who vacation in Bali every year.

Bali Hotels Association chairman Michael Burchett said on the weekend that there has been a crucial demographic shift in Bali's tourist market. Currently, the market is experiencing a rise in tourists from Taiwan and Russia, with fewer Australian and Japanese guests.

"Many in the government and from survey agencies are often mesmerized by the increase in tourist arrivals, which is often misleading," Burchett explained.

Statistics show that in June this year, the number of tourist arrivals in Bali reached 109,651, 7.7 percent up on the May figure of only 101,776.

This relatively insignificant rise has provided false hope to many officials, who may now be thinking that Bali is already back on its feet. "Bali has recovered," Minister of Culture and Tourism Jero Wacik has often said.

The reality is rather more stark. "The majority of our new guests spend less time and money, reflecting the changing market. Bali has not recovered yet," confirmed Burchett, also general manager of Conrad Bali Resort and Spa, Tanjung Benoa.

This means that the industry is earning a reduced income, employers receive less in service charges and the community gets a very meager share of tourist spending. "The industry is facing a dire financial situation, as are the people of Bali in general," he explained.

According to a report by Bank Indonesia, the central bank, international travelers have reduced their length of stay in Bali from an average 4.01 days in 2003 to 3.12 in 2006.

Hotel occupancy rates were an average of 56.42 percent from June to September, traditionally Bali's peak season.

Since the 2005 bombings the island's hospitality industry has been losing around US$2.5 million per day because tourists have gone elsewhere.

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The declining popularity of Bali on the world tourist market has become the greatest challenge to the Indonesian tourist industry since Bali is its crown prince.

Bali has provided the largest share of revenue of the country's $5.1 million annual income from tourism.

The central government in Jakarta appreciates the importance of boosting tourism in Bali. President Susilo Bambang Yudhoyono set aside a special fund amounting to Rp 67 billion (the Bali Recovery Fund) soon after the 2005 bombings.

Early this year, head of Bali Tourism Office Gede Nurjaya and chairman of Bali Tourism Board Bagus Sudibya told the media that part of the recovery fund, a sum of Rp 37 billion (US$3.9 million) would be disbursed for use on a variety of promotional activities.

"With the disbursement of these funds, we shall immediately launch a number of initiatives to assist in the recovery," Nurjaya said happily.

The delay in disbursement, he said, was mainly due to a reshuffle of the Cabinet economics team.

That was seven months ago.

As of the end of July, the promised funding did not appear. "It was becoming extremely frustrating to all stakeholders in the Bali tourism industry," Nurjaya said.

Just recently, industry people urged Jero to disburse the fund immediately, as the ministry had held it for so long, apparently due to government inefficiency and excessive red tape.

With the money in hand, the industry will launch campaigns in major markets, especially Australia and Japan. A private company has been appointed to help design marketing strategies, promotional efforts and the rebranding of Bali's image on the world market.

This time, the Bali tourism industry, due to its deep frustration, is urging Jakarta to take the issue very seriously. "We've been waiting (for the disbursement of the recovery fund) for so long and this is not the time to play games," Burchett said.

A lack of recovery will mean no job for many locals, and less revenue for the industry, the government and the people.

With more than 40 percent of the island's 3.1 million population relying for a living on tourist-related activities, a slow and indistinct recovery is could well exact a huge cost in terms of social and economic unrest on the "paradise isle".

posted by andersonite @ 11:17 AM