Sri Lankan tourism, numbers and value

Now Sri Lanka is enjoying the dividends of peace. The growth of the tourism sector can be witnessed. This is more important for economic growth since the country always depends on garments as well as traditional exports like tea.

Especially for products like garments, we have to import the materials from overseas. So the net income is not that much significant in terms of revenue generation. We can now also see the pressure mounting from Western countries (GSP+, etc.) on Sri Lankan garments.

Hence, in this context as well as because of the peaceful environment, the strategic window has been opened for tourism in Sri Lanka. Tourist arrivals to Sri Lanka rose 39 per cent in May 2011 from a year earlier. This is same in the international scenario as well.

Rise in tourist arrivals

International tourist arrivals increased by 4.5% in the first four months for 2011, according to the latest issue of the UNWTO World Tourism Barometer. Between January and April 2011, destinations worldwide recorded 268 million international tourist arrivals, some 12 million more compared to the 256 million registered in the same period in 2010.

Regions around the world recorded strong year-on-year growth, led by South America (up 17 per cent), South Asia (up 14 per cent) and South-East Asia (up 10 per cent). A large number of countries around the world reported positive results in the first months of 2010.

Of the 77 destinations reporting data for this period, 60 showed positive figures, of which 24 posted double-digit growth including Estonia, Israel, Hong Kong (China), Macao (China), Japan, Taiwan (PR of China), Indonesia, Singapore, Vietnam, Guam, India, Nepal, Sri Lanka, US Virgin Islands, Nicaragua, Ecuador, Kenya, Seychelles, Morocco, Egypt and Saudi Arabia. So the increase in tourists is visible in many other countries as well.

Therefore, the mechanism for Sri Lanka is to get a competitive advantage by promoting the industry by adopting better marketing strategies including proper research in the field as well as developing the cluster areas for tourist attraction by promoting our Sri Lankan identity.

Diversified strategies and sustainability

It is important to understand from which countries we have more tourists arriving. Figures released by Sri Lanka’s Tourism Authority confirmed that 68,830 Indians visited Sri Lanka between January and May this year, up 54.5 per cent over the same period last year.

However, even though the numbers are increasing, there should be a system to increase spending in Sri Lanka and to increase the staying time in the country. Numbers will not tell you the story. As an example, most of the Indians are coming to Sri Lanka by looking at cheap accommodation and shopping but the tourist coming from Russia will spend millions to enjoy his holiday (different objectives). The country can also target different segments like international business conferences, etc.

In 2010, Malaysia welcomed 1.3 million international business event visitors, contributing an estimated EUR 4 billion (US$ 6 billion) to the economy. The meetings hosted include the Asian Pacific Digestive Week (2,661 delegates), 6th World Islamic Economic Forum (2,000 delegates) and the 2nd Global Model United Nations Conference (1,000 delegates).

Such diversified strategies can be very important for the sustainability of the tourism. We can get an example from our neighbouring countries, like the Maldives.

Maldives example

Tourism in the Maldives is the largest industry for the country. It is always the practice of travelling for pleasure and the business of providing tours and services in Maldives. There was a nice story behind this as well.

Back in the 1960s, a UN report said that none of the 1,100 islands were suitable for tourism. That was the verdict of UN (so we can see the conclusions of the UN were debatable even back in the 1960s). Today, Maldives is synonymous with terms such as luxury getaway, paradise on earth, lavish holiday, et al, and the United Nations holds the country as a ‘model for sustainable tourism’.

This industry in Maldives started in 1970s with just two resorts with a capacity of about 280 beds in Kurumba Village and Bandos. Today, more than 500,000 tourists visit the Maldives each year. The most important factor is the way the country is targeting tourists from countries like China (considered as an emerging super power in the world’s economy).

The Maldives received more than 65,000 Chinese tourists in the first five months of this year, a 56.7 per cent increase over the same period of 2010, according to the latest figures. Numbers from the Maldivian Tourism authorities illustrate that the number of Chinese tourists to the Maldives accounted for 16.6 per cent of total foreign tourists from January to May, ranking top among foreign visitors, followed by Italy with 47,900 tourists, Britain, Germany and France.

Eye on China

Given China’s fast growing economy, an increasing number of people are able to afford overseas holidays. According to sources, the major factors in attracting Chinese tourists include unique sand beaches, visa free access and a variety of water sports.

In Sri Lanka also we can promote areas like Pasikudah and Nilaveli, as well as other areas with strategies on creative promotional programmes. Unlike the Maldives, Sri Lanka is equipped with more places to be seen, from mountains to beaches to cultural traditions in places like Anuradhapura and food to sports.

However, promoting ‘Sri Lanka’ should be the game plan. Again, there is a need to improve infrastructure. We should know how to ‘market; our culture by protecting its core values. That should be the way we gain the competitive advantage in this industry.

The arrival of more tourists can be considered important, but that is only one factor for sustainability. It is obvious that people are coming because of the peaceful environment. However, Sri Lanka should change the ratio of tourism; say 30% Europe, 20% China, etc. by 2015.

We have to have such smart objectives in place, which can be achieved through implementing a sound mechanism for sustainability in tourism.

Attracting and retaining tourists

According to experts, there should be a proper research mechanism to understand the needs and wants of tourists. Asking tourists whether they are satisfied with their trip and why can be very helpful when identifying the lack of quality and possibilities for improvement.

According to the publication of ‘Criteria for Sustainable Tourism’ by the UNEP and GEF, constantly checking visitor satisfaction and the success of measures taken to improve the products offered can be evaluated. Possible indicators for this can be percentages of tourists satisfied, visitor expectations met and return visitors.

These factors can be very important in attracting and retaining tourists (acquisition and retention drivers in customer relationship marketing) in Sri Lanka.

It can be proposed that instead of only looking at the number of tourist arrivals in Sri Lanka, to also change the composite of tourists coming to Sri Lanka. The authorities can benchmark countries like Maldives or even Malaysia on this (with proper rationale by looking at the Sri Lankan context). Accordingly, it is important for Sri Lanka to make use of this opportunity by using the strategic perspective with long-term mission.

(The writer is a Chartered Marketer and Consultant, Senior Lecturer in Marketing – Open University of Sri Lanka and a certified trainer for tutors and mentors in online learning. He holds an MBA (Colombo), B. Sc Mkt. (Special) (SJP), MCIM, Dip in MKT (UK), MSLIM, MAAT and Dip in CMA, Chartered Intermediate from ICASL.)