Post COVID-19 Strategies for Indonesia Tourism
The worldwide outbreak of COVID-19 has given major unprecedented challenge to many sectors. Within just a flip of several weeks, things have changed, lifestyle changed. Many countries urged their people to stay home to help stop the spreading of the virus. Some even applied lockdowns and forced travel restrictions in and out their countries.
This outbreak has hit the tourism sector quite hard, as many hotels and tourism destinations all over the world have to be closed temporarily, including amusement parks, sport venues, and also convention centers. The United Nations World Tourism Organization estimated that global international tourist arrivals dropped by approximately 22% in Q1 2020. Forward looking scenarios estimates that international arrivals on 2020 can fall of by 58%–78%, depending the speed of containment and the re-opening of borders.
The impact of COVID-19 to Indonesia tourism can be seen by the drop of the foreign tourist arrivals. In February 2020, foreign tourist arrivals plunged 24% on year-on-year basis, while in March, it further fell off by 64% year-on-year to about 470,900, or fewer than half of January’s number.
Malaysia, China and Singapore were recorded as the three main contributors of foreign tourist arrivals in Indonesia in recent years. As a result of the pandemic, foreign tourist arrivals from those countries experienced a sharp decline. Chinese tourist arrivals even slid more than 97% on a yearly basis in March.
Thus, what will be the outlook for tourism?
Despite the massive impact of the COVID-19, we have seen that tourism sector has been resilient in previous crises, such as SARS and the global economic crisis. We fully expect to have a fast recovery after this pandemic too. On the other side, Indonesia is benefited by its huge population and high domestic consumptions, not to mention the nature and culture richness it has.
Several strategies to adopt for the recovery of Indonesia tourism sector include:
This outbreak has hit the tourism sector quite hard, as many hotels and tourism destinations all over the world have to be closed temporarily, including amusement parks, sport venues, and also convention centers. The United Nations World Tourism Organization estimated that global international tourist arrivals dropped by approximately 22% in Q1 2020. Forward looking scenarios estimates that international arrivals on 2020 can fall of by 58%–78%, depending the speed of containment and the re-opening of borders.
The impact of COVID-19 to Indonesia tourism can be seen by the drop of the foreign tourist arrivals. In February 2020, foreign tourist arrivals plunged 24% on year-on-year basis, while in March, it further fell off by 64% year-on-year to about 470,900, or fewer than half of January’s number.
Malaysia, China and Singapore were recorded as the three main contributors of foreign tourist arrivals in Indonesia in recent years. As a result of the pandemic, foreign tourist arrivals from those countries experienced a sharp decline. Chinese tourist arrivals even slid more than 97% on a yearly basis in March.
Thus, what will be the outlook for tourism?
Despite the massive impact of the COVID-19, we have seen that tourism sector has been resilient in previous crises, such as SARS and the global economic crisis. We fully expect to have a fast recovery after this pandemic too. On the other side, Indonesia is benefited by its huge population and high domestic consumptions, not to mention the nature and culture richness it has.
Several strategies to adopt for the recovery of Indonesia tourism sector include:
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Look within. Focus on domestic tourists.
Indonesian tourism is still very much dominated by the domestic market. The composition of domestic tourists in Indonesia is far greater than foreign tourists. With much of the world also facing uncertainty, utilizing domestic tourists is lucratively the best way to drive Indonesia's tourism growth in the short and medium term. Local tourism empowerment. The destination for domestic tourists is generally VFR (Visiting Friends & Relatives). So that the empowerment of local tourism objects has the potential to be developed. Targeting millennials alongside enhancing digital marketing activities.
More than 50% of domestic tourists who carry out tourism activities are millennials (aged under 35 years now). Millennials are travelers that is very close to technology. They have involvement in various social media and are active in sharing their experiences including traveling. This is a great potential that needs to be developed by various tourism actors. |
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Targeting the upper-middle class of major cities in Indonesia for they are high-spending travelers.
Indonesia benefits from a large population and high domestic consumption. Looking at the area of origin of travelers, the largest composition of domestic tourists who travel is from Java, especially East Java, West Java, Central Java and DKI Jakarta. Accommodation development that is cost savvy yet offers a unique tourist experience. Accommodations that are still commonly used by domestic tourists are the places where friends and relatives live. Only 11% of the total Indonesian tourists using hotels as accommodation facilities during travel. The solution to respond to this trend in the current pandemic conditions is the development of new accommodations that are cost savvy but offer unique tourism experiences, for example glamping, or hotels that are integrated with historical tourism activities, agro resort, and so on. Culinary tourism. Based on statistical data, the biggest expenditure component of domestic tourists is transportation and food-beverages. One type of tourism that is quite affordable and in-demand by most tourists (including Indonesian tourists) is culinary tourism. Moreover, Indonesia is rich in culinary variety that has the potential to be appointed as a tourist theme in various regions. The development of culinary tourism is seen as having great potential in the recovery period of this pandemic, because it can utilize relatively lower investment compared to the development of accommodation or other tourism facilities. |
With most of the world is also dealing with uncertainty, tapping domestic travelers may be the best way to fuel the growth of Indonesia tourism in the short to medium term. Start from within. Empower locals. Engage multi-players. Small steps to survive, then accelerate. These parallel efforts will surely enable the sector to emerge from this crisis even stronger.
Author
Iswin Hudiarto
Principal/Lead Consultant
Principal/Lead Consultant
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