4.2 National Markets

Vision: Regional Victoria becomes more top of mind as a holiday destination for the domestic market and Melbourne's image as a stylish and sophisticated city destination continues to grow.

Objectives

• Increase awareness of key regional Victorian destinations and attractions.
  
• Build tourism business profitability and visitor dispersal.
• Market Melbourne as the gateway to Victoria.

BACKGROUND

Domestic Trips

Australians took more than 74 million overnight domestic trips during the year to September 2001, spending about $32 billion. Victoria received 25% of domestic visitors, second only to New South Wales (35%). In total, Victoria received 18.4 million overnight domestic visitors for the year, who stayed more than 55 million nights.

Victoria's Market Share

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Source: National Visitor Survey, Bureau Tourism Research, 2001

More than 46% of overnight domestic visitors to Victoria travel for holiday/leisure purposes. A large number also visit family and friends (33%) or undertake business travel (17%).

Acording to the Bureau of Tourism Research, intrastate travel for the year ending 1998 accounted for almost three-quarters of Victoria's domestic market, yielding a total of $2.7 billion at an average of $190 per trip. In comparison interstate visitors contribute more to the Victorian economy, staying about four nights and spending on average $786 per trip. In 1998 interstate visitors spent a total of $3.5 billion in Victoria. New South Wales currently accounts for 53% of Victoria's interstate market, followed by South Australia (17%) and Queensland (14%). Popular activities for visitors to Victoria include eating out in restaurants, visiting friends and relatives, sightseeing, entertainment and enjoying the nightlife, shopping and going to the beach.

More than 72% of domestic visitors to Victoria travel to regional Victoria, with the majority of these visitors (61%) originating from Melbourne. Victoria received over 40 million day trip visitors for the year ending September 2001. Nearly all day trip visitors are intrastate visitors (98%).

Interstate visitors to Victoria

Interstate visitors to Victoria have grown by 3% over the period 1998-2000

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Intrastate visitors to Victoria

Intrastate visitors to Victoria increased by 8% for the year ending December 2000 over the previous year, a significant recovery from the decline in intrastate travel that occurred in 1999. The downward turn in 1999 can largely be attributed to a shift in Victorian consumer spending patterns towards the housing sector and other related household items.

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Source:
National Visitor Survey, Bureau of Tourism Research (1998-2000)
Domestic Tourism Monitor, Bureau of Tourism Research (1993-1997)

Break in Series - In 1998, the National Visitor Survey (NVS) replaced the Domestic Tourism Monitor (DTM) which previously reported on domestic travel. The figures in the NVS are not comparable to the results in the DTM, due to the differences in the survey methodologies and changes in definitions of terminology. The NVS provides information not previously available, such as expenditure, regional and outbound travel data.

Brand Awareness and Consumer Attitudes to Victoria

Tourism Victoria has been carefully monitoring the changes in domestic consumer attitudes to Victoria as a holiday destination since the launch of Tourism Victoria's 1993 Strategic Business Plan.

Consumer research shows that the image and appeal of Melbourne as a destination has dramatically improved since the start of the You'll love every piece of Victoria Jigsaw campaign in 1993. The perception of Melbourne as a short break destination offering a range of events, theatre, arts, shopping, restaurants and street precincts is strongly reflected in the consumer surveys of attitudes to Australian cities.

Melbourne is now an established and accepted destination for Australians' short break travel. Short break trips to Melbourne have been strongly supported by the airlines and travel trade, with interstate visitation to Melbourne growing at an average annual growth rate of 5% during the period 1999 to 2001. Melbourne is the key driver of tourism to Victoria.

Recent Marketing of Melbourne

The role of Melbourne as a gateway to regional Victoria is of strategic importance to the marketing of Victoria. The Melbourne Plus campaign launched in 1998, began the process of communicating to interstate consumers the wealth of regional product available within two hours' drive of Melbourne. Melbourne is the gateway to regional Victoria for many interstate travellers, while the compactness of Victoria is a competitive strength.

The latest phase of the Jigsaw campaign, the Romantic Melbourne campaign has sought to further differentiate Melbourne from other Australian cities as a short break destination by emphasising Melbourne's style, sophistication and romance.

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Source: Brand Health Survey, Roy Morgan Research Centre

Jigsaw campaign - major campaign summary

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Recent Marketing of Regional Victoria

The Tourism Victoria Strategic Business Plan 1997-2001 identified the lack of knowledge of regional Victoria among interstate consumers. At that stage no comprehensive interstate marketing campaign had ever been conducted for regional Victoria.

The Touring Victoria marketing campaign was launched in 1997. The campaign promoted touring by car in regional Victoria. It included television, cinema, magazine, newspaper and outdoor advertising, in both interstate and intrastate markets and was supported by a new Victoria brochure detailing recommended touring routes.

Consumer response to the Touring Victoria advertisement has been extremely positive. Qualitative and quantitative research is conducted among key target segments on all marketing campaigns to test overall effectiveness and consumer reactions to the campaigns. Recent studies have found that a high proportion (78%) of consumers felt that the Touring Victoria advertisement was highly effectively in not only capturing and sustaining people's attention, but delivering an effective message.

Consumer response to Tourism Victoria marketing campaigns

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Source: Advertising Development Solutions

There has been a marked improvement in consumer awareness of regional Victoria as a result of the Jigsaw campaign activity, however there is a need to grow awareness in the market place of Victoria's key regional destinations and attractions.

Interstate awareness of Regional Destinations

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Source: Regional Awareness and Perceptions Survey- October 2001, Roy Morgan Research Centre

The major barrier to further growth in interstate visitation to regional Victoria is a lack of awareness of the destinations. This barrier can be overcome by increasing the level of marketing through a sustained marketing campaign, which seeks to build higher awareness of the key regional destinations. The campaign must hero a small number of specific key destinations and iconic attractions in order to build awareness and desire to visit. More detail can be found in the Marketing Regional Victoria section of this plan (Chapter 4).

Market Segmentation

Tourism Victoria segments the national market in a number of ways using segmentation techniques including the Roy Morgan Value segments, developed in conjunction with Collin Benjamin - The Horizon Network, MOSAIC and Lifecycles.

The Roy Morgan Value Segments in particular have been used by Tourism Victoria to distinguish markets with the highest yield potential and to identify their holiday needs. A full description of the market segmentation process and profiles of the target segments can be found in Appendix B.

New South Wales (Sydney), South Australia (Adelaide) and Queensland (Brisbane) have been identified as the principal targets for marketing Victoria.

In marketing Melbourne as a short break destination, the Socially Aware, Visible Achievement, and Young Optimism are the core market segments.
The Visible Achievement and Socially Aware segments account for the largest proportion of Melbourne's interstate short break market at 25% and 18% respectively.

In terms of expenditure these segments are of prime importance as they make up about 50% of interstate short break expenditure in Melbourne. There is also a strong match between Melbourne's product offerings and the holiday experiences sought by the Visible Achievement and Socially Aware segments including food, wine, arts and culture.

A secondary market is the Young Optimism segment which comprises about 14% of interstate short breaks in Melbourne and 15% of expenditure. This segment also offers potential in terms of product match as they have a strong tendency to participate in activities such as shopping and events, which are among Melbourne's strengths.

When marketing regional Victoria, as well as the key markets of New South Wales, Queensland and South Australia there is an important emphasis on the intrastate markets.

In addition to the Visible Achievement, Socially Aware and Young Optimism segments, the Traditional Family Life segment has been identified as a priority for regional Victoria because of its high propensity to undertake touring holidays.

ISSUES

The recognition and consistency of the Jigsaw Brand remains a competitive strength. Further development of the brand and leveraging the profile already achieved provides a unique opportunity for the State.

Selling the compactness of the State is an important aim, especially the diversity of attractions and experiences available in a relatively small area. A combined city and regional holiday or visit is readily achievable.

Interstate awareness of regional Victoria is low. Success achieved in marketing Melbourne needs to be mirrored in regional Victoria. A key objective of the marketing strategy is to build "top of mind" awareness of key destinations and attractions in regional Victoria.

One of the most crucial trends will be the merging of the tourism and leisure industries. This places tourism in competition with other entertainment activities such as theatre, home entertainment and other related products.

Competition for the tourist dollar has never been stronger. The Victorian tourism industry has both direct and indirect competitors ranging from other destinations such as News South Wales and Queensland, to competitors for consumer leisure time such as sport and home renovation. As the value of tourism becomes increasingly apparent, the competition in tourism marketing will continue to escalate.

Victoria must highlight and leverage product strengths such as events and festivals, food and wine, touring, and the natural environment. Further emphasis on marketing and integrating product to develop a more holistic experience for the consumer is needed.

Victoria's lack of a singular product strength creates a more complex marketing challenge. Although the State's diversity provides a competitive advantage it requires a spread of the marketing effort. There is no single hook with which consumers can associate Victoria.

The intrastate market makes up three-quarters of all domestic travel in Victoria. There is a significant opportunity to increase the benefits of domestic tourism by placing more emphasis on the intrastate market. The growth of tourism in regional Victoria requires increased operator profitability. Marketing to the intrastate market will help boost tourism visitation and yield in regional Victoria.

STRATEGIES

Tourism Victoria, in co-operation with industry partners will implement the following:

• Interstate marketing of Melbourne will continue to be undertaken under the banner of the You'll love every piece of Victoria Jigsaw campaign. Image marketing campaigns for Melbourne, including Romantic Melbourne will be strongly interpreted with a range of Melbourne product, event and tactical marketing campaigns.
  
• Phase 7 of the You'll love every piece of Victoria Jigsaw campaign will focus on regional Victoria.
  
• Over the three-year campaign a series of major marketing promotions will be conducted to hero selected key regional destinations and attractions. Marketing of these destinations and attractions will include public relations, image and tactical advertising, direct marketing and internet marketing and will be undertaken cooperatively with the relevant campaign region committees.
  
• Interstate marketing campaigns will feature both car-based touring holidays as well as flight and ground content holidays using Melbourne as the gateway to the regions.
  
• Phase 7 of the Jigsaw campaign includes an increase in the level of intrastate marketing of regional Victoria. New marketing campaigns will be developed to promote visitation by Victorians to all of the State's campaign regions.
  
• Cooperative marketing of the diverse and seasonal attractions of Melbourne will continue through the Melbourne in Spring, Melbourne in Summer, Melbourne in Autumn and Melbourne's Great Indoors umbrella campaigns.
  
• Cooperative marketing programs will be expanded with domestic airlines and domestic wholesalers and retailers to develop attractive packages to Melbourne for domestic consumers.
  
• National marketing and promotion of Victoria's wineries will increase and be supplemented by increased promotion of regional Victoria's restaurants, local food and regional produce.
  
• Work will continue with the television networks to promote regional Victoria to Victorians through television programs such as Postcards and Discover Victoria.
  
• Promotion of regional accommodation through programs such as Victoria's Great Escapes and Bed and Breakfast Getaways will continue. Distribution of regional accommodation through a range of domestic wholesale programs will be further developed.
  
• An integrated marketing program for regional tour operators will be developed featuring a range of product such as natural attractions, adventure tourism, nature based tours, food and wine tours, heritage and cultural tours. The program will include incorporation of product in published guides, as well as promotion on visitvictoria.com.