Visitor arrivals numbers still increasing, but visits are becoming shorter
Since 2010, the number of visitors arriving in New Zealand has increased by almost 60 percent, but visits are becoming shorter.
In October last year, BERL posted an article on this website, about the slower growth in international visitor numbers. At that point in time, the annual rate of growth in both international visitor arrivals and international visitor guest nights had slowed to around 3.5 percent, compared to a peak growth rate, for both measures, of almost 12 percent in late 2016.
Since then, the rate of growth in visitor arrivals has firmed a little, but the rate of growth in guest nights has slowed even further. It is now apparent that guest nights are growing more slowly than visitor arrivals, because visitors are making shorter visits.
In the 12 months to January 2019, the number of international visitor arrivals in New Zealand was 3,883,335. This was 151,468, or 4.1 percent more than during the 12 months to January 2018.
By comparison, in the 12 months to January 2019, the number of nights international visitors spent in commercial accommodation was 17.559 million. This was 257,000, or just 1.5 percent, more than during the 12 months to January 2018.
It is now apparent that guest nights are growing more slowly than visitor arrivals, because visitors are making shorter visits.
The chart below shows how the annual growth rate in visitor arrivals (based on Statistics New Zealand data from arrivals cards) and guest nights (based on Statistics New Zealand’s Accommodation Survey) has tracked since 2010.
It shows that the growth rate in international visitor arrivals dipped into negative territory just once, in 2013. By contrast, the growth rate in international guest nights was negative in all four years between 2010 and 2013. Moreover, the growth rate in international guest nights was more rapid than the growth in visitor arrivals only in 2014 and 2015.
Looking at the whole period between the 12 months ending January 2010 and the 12 months ending January 2019, the number of visitor arrivals increased by 59 percent, while the number of international guest nights increased by just 30 percent.
A possible explanation is that international visitors have increasingly used accommodation that is not covered by the Accommodation Survey, such as staying with friends and relatives and Airbnb. However, it is known from the International Arrivals data that the average length of stay amongst all visitors has decreased fairly steadily since 2009. In 2009, the average (mean) length of stay was 20 days, but this had fallen to 18 days by 2018. A two day reduction in the average length of stay might not sound much but, multiplied by the number of visitors, it amounts to a great deal.
One of the factors behind the reduction is the increasing share of the market accounted for by Chinese visitors, who tend to pay shorter visits than the average. On the other hand, Chinese visitors tend to spend more than the average, so the overall result is that total international visitor expenditure in New Zealand has not been adversely affected.
Postscript: Readers might like to note that BERL will shortly be publishing a longer research report that examines the changing profile of international tourism in New Zealand between 2008 and 2018. The report reflects our ongoing interest in the tourism industry, and it will delve into many facets of the market, including: visitors’ origins; their reasons for visiting; their age groups; how much they spend; where they visit; and how long they stay.
The report will be available on this website and will be downloadable.