Oct. 14 (Bloomberg) -- The “Oprah effect” might not be enough to help Sydney’s flagging tourism industry.
Australia is spending more than A$3 million ($3 million) to bring billionaire talk-show host Oprah Winfrey to the city for the first time and stage her show in December for broadcast to U.S. audiences, Tourism Minister Martin Ferguson said last month.
While Winfrey is the city’s latest weapon in the battle to lure back visitors put off by the record-high Australian dollar, travel agents and advertising professionals say the money would be better spent attracting the Chinese. A dearth of Mandarin-speaking guides at icons like the Sydney Opera House, one of Winfrey’s show venues, is forcing tour companies to recruit staff from China, according to the Australian Tourism Export Council, the nation’s top body for the industry.
“Getting Oprah here isn’t going to get anyone from China to come here,” said Peter Grasse, executive producer in Sydney at Curious Film, which worked on advertising campaigns that won the Grand Prix at a Cannes media festival in June. “They should be making multiple ads for multiple markets, like the Chinese market, instead of putting all this effort into something so one dimensional.”
Australia’s staging of the Oprah Winfrey Show is the latest government effort to reverse a decline in its A$12.1 billion tourism industry, the country’s fifth-biggest export earner. The government has run four campaign slogans in the past five years while the currency has risen to its highest level since the end of exchange controls in 1983.
The Oprah Effect
Tourism Australia, the government body that markets the nation overseas, is spending A$1.5 million to bring Winfrey for her visit. New South Wales state, where Sydney is located, is contributing as much as A$2 million. Sydney-based Qantas Airways Ltd. will fly Winfrey and her 300-strong studio audience from North America.
All are seeking to benefit from the so-called Oprah effect, where endorsements from the most-watched U.S. talk show host has turned books, cakes and beauty products into bestsellers. Her endorsement of Barack Obama when he was a Senator is credited with helping him become U.S. president.
“Oprah coming is a good thing but that won’t do anything to encourage the Chinese,” said Mark Ritson, an associate professor of marketing at the University of Melbourne Business School who works with companies such as Adidas AG and PepsiCo Inc. “We’re not doing enough thinking about China and now is the time to get stuck in there with so much growth to offer.”
Inbound visitor numbers to Australia are 4.5 percent below their peak in July 2008 as the government shifted campaign strategies, including a slogan that pleaded with potential visitors: “Where the bloody hell are you?” according to Ritson. The current tourism tagline is: “There’s Nothing Like Australia.”
U.S. Visitors Stall
While visitor numbers from the U.S. have stalled since the global recession, China last year overtook Japan as the fourth-largest source of tourists for Australia behind New Zealand, the U.K. and the U.S., according to government figures. China could rise to first, said Christopher Brown, managing director of Tourism & Transport Forum, a lobby group representing 200 tour companies.
“As the Chinese economy continues to grow, so does the number of Chinese people who can afford to travel,” said Brown. “It’s entirely possible China could get to number one.”
Australia’s share of Chinese outbound tourism was 1.4 percent in 2009, up from 1.3 percent in 2000, putting it 13th as a destination, trailing Singapore, Malaysia, Thailand and France, according to data provided by Tourism Australia.
More Flights Planned
China Southern Airlines Co., Asia’s biggest carrier by passenger numbers, is doubling flights to Sydney and Melbourne and adding services to Brisbane from Oct. 31. HNA Group Co., controlled by the government of Hainan province, is seeking to buy Australian hotels as part of plans to spend $200 million on investments in the country, Chairman Chen Feng said in a July 28 interview.
This year, 54 million Chinese people are expected to travel abroad, according to the China Tourism Academy.
Improving support for tourists when they arrive is critical in capturing a larger share of Chinese tourism, according to Matt Hingerty, managing director of the Australian Tourism Export Council.
“We’ve got a significant shortage of Chinese speakers and we’ve got no choice but to effectively import them,” said Hingerty. “We still have a long way to go to get it right.”
Word of Mouth
It’s a view backed by Tourism Australia, which said failing to give tourists a memorable visit can do damage as “word of mouth” can be the strongest influence on potential visitors.
“That is our best opportunity to make them advocates for our country as the ‘on the ground’ experience is absolutely essential,” Managing Director Andrew McEvoy said in a telephone interview. “As the market grows the industry gets better at adapting and we are in that phase right now.”
Winfrey will record at least two programs in Australia for airing to U.S. audiences in early 2011, including one filmed at the Opera House, Ferguson said. She may also visit Melbourne and Brisbane, Australia’s second- and third-largest cities.
“Tourism Australia pitched the concept to ‘The Oprah Winfrey Show’ and we accepted their invitation,” Don Halcombe, a spokesman for Harpo Productions Inc., Winfrey’s Chicago-based company, said in e-mailed comments. He didn’t say if the show is expected to boost tourism.
Tourism contributed A$12.1 billion to exports in the 12 months ended June 2009, according to the most recent government data. In June, the Australian government announced plans to spend A$30 million marketing to Chinese tourists that live outside the nation’s three largest cities of Shanghai, Beijing and Guangzhou.
Noel Scott, a senior lecturer at the University of Queensland’s School of Tourism, said Chinese visitors face similar problems to those experienced by the Japanese in the late 1980s, such as a lack of multilingual guides or Chinese instructions on public transport.
Jessie Lu, a 29 year-old publicist from Shanghai, met the problem as she tried to get a taxi back to her hotel after dinner at the Sydney Opera House. The taxi drivers didn’t want to accept her short fare, forcing Lu and her companions to walk, she said through an interpreter.
It’s an example of how Australia needs to spend more on adapting to make the country a better destination for visitors from China, according to Tourism Export Council’s Hingerty.
“We need to keep retooling ourselves to win that Chinese market,” Hingerty said. “Oprah isn’t a strategy in itself.”
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