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Are you a tourism business who is leaving money on the table?

I realise sitting down to write this piece that I have done an awful lot of work in very remote areas trying to crack the tourism puzzle. What has always struck me when working with tourism entrepreneurs in these places is the massive artificial barrier they build in front of themselves because of what they define tourism to be. Which is the arrival of suitcase lugging wealthy white international travellers with lots of dollars to spend. And as more than one local entrepreneur has informed me, the best way to get as much of these dollars as possible is to call what you do ecotourism. Because then you can charge international tourists a whole lot more money for it.

The challenge with this penchant to "other" tourists in this way (let me leave the ecotourism story for another day) is that it becomes a lot harder to build a business when your market is so far away and so foreign to you (excuse the pun). And Covid19 has most certainly shone a harsh spotlight on the risks entailed in taking this approach.

All of this has left me pondering how we have come to prioritise international tourists as the default tourist.

Yes yes, I realise that foreign exchange (the driver of tourism industry development at a government level) trumps all else. But how does that translate down to businesses on the ground?

I wondered if the problem is the technical definition of tourism. But I was proved wrong. According to the United Nations World Tourism Organisation, a tourist/traveller is defined as someone who moves between different geographic locations for any purpose and any duration. Which leaves the door wide open to think about all the different types of tourists that could be catered to, from local, to domestic, to the next ring of neighbouring countries, to regional, continental, and in the very last ring, short-bound and long-bound international tourists.

So where do these international tourist blinkers come from?

Why if the market is so broad and so accessible, do local entrepreneurs keep focusing on the elusive, highly competitive, and costly-to-get international market instead of the early adopter market on their doorstep?

It may perhaps boil down to the belief that the local market has little value to offer. That they are not wealthy enough to be tourists and are not wanting/willing to pay for weekend/holiday entertainment. And tied to this is the mis/perception that the international market by definition is wealthy (full stop) and not price sensitive at all. So for a product to be considered tourism, it has to be high-priced and therefore beyond the reach of the local market.

Don't get me wrong there is nothing intrinsically wrong with designing high-priced product if you can create the quality standard and experience worth paying that much for. But the reality is that many first time tourism entrepreneurs struggle to achieve this. I have had entrepreneurs tell me that they are charging $1000 for a very basic two-night homestay (picture a bed on the floor and a bucket shower). Or $200 for a canoe ride to a lake where you can bob-up-and-down before returning back. It is of little surprise that no matter how hard they tried these entrepreneurs struggled to get bums-in-beds/boats.

Yet at the same time, there was a real need in these villages for activities that families could do together on weekends, like fun canoe adventure races, forest treasure hunts, boat tubing, paddle-boarding, the list goes on and on. But because these entrepreneurs were so focused on dollar-wielding tourists they struggled to see the multitude of "hyperlocal" tourism opportunities on their doorstep.

And this is not unique to local entrepreneurs. I see the same thing with hotels that are so focused on the international market that they completely miss all the "hyperlocal" opportunities found within their urban setting. Just think about the last time you went to a hotel in your city for a meeting and looked over to see a sad empty hotel restaurant or business lounge... When this space could be filled with locals spending money daily.

All these missed opportunities make me believe that we do in fact need to redefine tourism. And rethink the way we design tourism product so that we stop leaving all the money on the table and start to create better places and product for people to enjoy.

What does this mean for you going forwards?

Reach out and lets explore how taking a "hyperlocal"approach can help you make more money in your business.

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