I took the liberty of taking a closer look at the data from Infoshare and did the same calculations for several periods. What I found was rather interesting. From a national perspective, I calculated the year on year percentage change in guest nights for domestic, international and combined. For the March-August 2011 period, the national change in guest nights was -0.39% when compared to the same period in 2010. The domestic guest nights for this period in 2011 were up by 6.25% on the same period in 2010 while the international guest nights were down by 9.75%.
I wondered if the aggregated March-August period results were influenced by the March month results (when the immediate effect of the Christchurch earthquakes), so I separated out the year on year percentage changes. These were the outcomes:
March: Total guest nights: -5.44%; Domestic guest nights: 1.65%; International guest nights: -13.1%
April: Total: -3.76%; Domestic: 0.41%; International: -9.91%
May: Total: 0.90%; Domestic: 6.41%; International: -7.54%
June: Total: 0.29%; Domestic: 3.83%; International: -6.25%
July: Total: 1.99%; Domestic: 8.55%; International: -8.86%
August: Total: 8.4%; Domestic: 14.39%; International: -1.01%
It is clear that the March and April months are influential in the aggregated period - the other months had increases in total guest nights. What is interesting about these monthly figures is how the change in domestic guest nights was positive and growing in July/August, suggesting a time-shifting effect is occuring when compared to the October figures. It appears that domestic travellers decided that they should do their travelling before the RWC rather than during it. Without question the school holidays being shifted to accommodate the timing of the RWC will have contributed to this effect. Also of note is the negative change in international guest nights for all six months - although there was a marked improvement in August. The negative year on year percentage changes in international visitor nights seen above actually began in September 2010.
The September 2011 period saw a small increase from 2010, with the change in total guest nights an increase of 0.23 percent. International guest nights were up by 20.72%, although this was almost offset by a fall in domestic guest nights by 11.8%.
When the RWC months of September and October are aggregated and compared with the same period in 2010, overall guest nights were down by 0.69%, with the 13.45% increase in international guest nights being more than offset by the 9.03% fall in domestic guest nights. It would appear that the overseas visitors did come for the RWC, but locals decided to travel before the influx of international visitors, resulting in a dampened effect on the accommodation sector (and. most likely, on the net economic impact of the tournament) during the RWC period.
A quick look at the total guest nights for regions for the RWC period reveals that each region experienced:
- Northland: a fall of 2.53% compared to an increase in the March-August period of 2.62%;
- Auckland: a smaller increase (12.5%) compared to the March-August period of 14.06%;
- Waikato: an increase (6.32%) compared to the March-August period of 5.05%;
- Bay of Plenty: a fall of 1.58% compared to an increase in the March-August period of 4.13%;
- Hawkes Bay and Gisborne: an increase (9.47%) compared to a fall during the March-August period of -5.51%;
- Taranaki, Manawatu and Wanganui: an increase (0.36%) compared to the March-August period of 0%;
- Wellington: a smaller increase (6.5%) compared to the March-August period of 13.48%;
- Nelson, Marlborough and Tasman: an increase (7.35%) compared to the March-August period of 5.17%;
- Canterbury: a smaller fall, (-25.1%) compared to the March-August period fall of -26.06%;
- West Coast: a larger fall, (-9.87%) compared to the March-August period fall of -7.29%;
- Otago: a smaller fall, (-1.3%) compared to the March-August period fall of -2.66%; and
- Southland: a smaller fall, (-2.04%) compared to the March-August period fall of -8.09%.
It will be particularly interesting to see what happens to these figures in the November and December months.
" It would appear that the overseas visitors did come for the RWC, but locals decided to travel before the influx of international visitors, resulting in a dampened effect on the accommodation sector"
ReplyDeleteIf all that occurred was locals decided to change the timing of their holidays, then the accommodation sector is no worse off. They're only harmed if people decided to cancel holidays altogether.
Also consider the effects of price changes. Locals may have travelled less because of the high prices, not of the RWC itself. If that's the case it may be the accommodation industry's own fault for the decrease in customers because they raised their prices too much.
It may also be that prices went up by enough to offset the decrease in customers, and the accommodation industry actually increased their profits during the RWC period. i.e. if a lot of price inelastic customers enter a market where consumers are normally price elastic, it may be profitable to raise prices so that overall quantity falls.
Price changes are particularly interesting, and will almost certainly have influenced what we have seen. I don't think there's a lot of doubt that higher prices during the RWC hurt domestic guest night totals. As you say, however, it could well be due to the nature of demand that the higher prices could have more than offset the loss in customers and as a result some accommodation providers were more profitable as a result. Let's not forget that a decent chunk of overseas visitors would have booked their accommodation in advance and would therefore have paid the pre-determined prices. Towards the end of the tournament, prices were reported to have come down in some areas due to a lack of customers.
ReplyDeleteIf the increase in prices cause numbers to fall, then it seems only fair to ask why the prices were up. This would be an interesting thing to check out - what exactly has the price of accommodation been doing in recent times?
It's really great to spend holiday vacation with this such kind of accommodation.
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