With inbound tourism not expected to fully recover until 2023/24, tour operators used to benefiting from international guests need to prioritise the domestic market.

Whilst there has been an upsurge in occupancy for regional accommodation providers, many tour operators have been struggling. According to the recent white paper by Tourism Research Australia ‘Moving Forward – The role of domestic travel in Australia’s tourism recovery’ the reasons are obvious:  

– Two-thirds of spend on group or package tours pre-COVID-19 came from international visitors
– Travellers that have seen a decline in household incomes will be more likely to do free activities
– Domestic travellers are familiar with what Australia has to offer and are less likely to pay for tours and attractions that the international sector would.

Meanwhile, wealthier domestic travellers are 50% more likely to travel interstate and typically spend 80% more per person per night on domestic overnight trips.  Those who would ordinarily have spent on first class international airfares each year now have a surplus of funds to spend here in Australia. Luxury travel agents are searching for ways to provide these wealthy clients with the equivalent of their overseas holiday but the lack of premium regional offerings makes this difficult, meaning funds will simply be saved up and spent overseas when they can finally travel again.