Great Barrier Reef Diver and FishThe story of Cairns is the story of Australian tourism, a once sleepy coastal town that becomes a tourism hot spot in the go-go 1980s thanks to its natural wonders and friendly, hard working locals who create fantastic tourism products through innovation and hard work.

They skipper boats out to the Great Barrier Reef and build up great fleets, work in kitchens and run restaurants, redevelop family land into five-star hotels, transform homes into backpacker hostels, and set up rainforest tour companies or whitewater rafting businesses.

Cairns booms, builds, prospers; builds some more, busts during the 1989 pilot dispute, recovers and rides the inbound tourism wave into the 21st century.

Before you know it there are 130,000 people living in a place that didn’t have a traffic light until the early 1970s.

To the north and south, in places like Port Douglas and Mission Beach, a similar ‘build it and they will come’ mentality prevails.

People live the dream and you’d have to say that wild optimism and a bit of greed starts to cloud decision making toward the end of the 1990s.

Some poor calls are made with a few industry players expanding as if the wet season does not exist and the good times will last forever.

Then things start to get weird around the turn of the century with the arrival of the Internet and Low Cost Carriers. Together they change the way people book and travel.

But the young innovators of the 1970s and 1980s have become older, wealthier, more conservative and in many cases distant from the huge changes happening in the wider world.

They don’t react, thinking things will stay the same. Bad move, change is the only constant.

And this is reflected in the performance of Cairns as a tourism destination over the past decade.

Visitor statistics compiled by Dransfield Hotels and Resorts show that international tourism numbers fell 16 per cent from 815,000 to 686,000 in the 10 years to the end of 2010.

Domestic tourism slumped six per cent from 1.371 million to 1.282 million visitors over the same decade.

There was a 10 per cent drop in visitations for the 12 months to June 30, 2011, over the previous corresponding period.

No surprise than Cairns has the lowest priced rooms of all Australian markets with the worst growth prospects.

The major issue, alongside the big fall in Japanese visitors, is that the key domestic market appears to have lost faith in the destination and are increasingly heading overseas to places like Bali, Fiji and Thailand.

So does this mean the end of Cairns and the rest of Tropical North Queensland as a growth destination?

In my opinion the answer is a firm no.

But industry leaders really need to get with the times, especially with regard to pricing, marketing and distribution.

In terms of pricing there’s a set and forget attitude. STR Global analysis reveals that so far in Cairns this year there have been 21 days with hotel occupancy of more than 90 per cent, however room rates barely moved in response to the extra demand, up just $9 over the $129 average.

Tour operators are even more intractable – their rates never change, doesn’t matter whether it’s high or low season.

Similarly, many marketers have are still looking at traditional sales techniques with the Internet not a significant consideration.

At the recent Destination Online TNQ seminar only two delegates out of 60 said they were making search engines such as Google the primary focus of their marketing.

Yet a survey of 900 Australian travelers by Travelzoo showed that 81.2 per cent of respondents would use an internet search engine to book their Cairns trip.

And despite having access to great rates (at least from a consumer perspective) there seems to be a local fixation with ‘building brand’ rather than pushing price, which is what consumers are responding to these days.

In some respects Cairns and domestic tourism have become like the major retailers – consumers are not finding them relevant when measured against global competitors.

But the opportunity is still there. The question is can the Cairns old-school adapt or will they succumb to tourism’s Darwinian evolution, where only the young and agile will prosper?


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