The Importance of Tourism for the Malaysian Economy in a Recession

Given the relatively teeny size of our economy, Malaysia is a country heavily reliant on exports as a origin of income. Manu positionuring, our biggest foreign exchange earner, currently accounts for the bulk (70%) of native exports led by electronic parts and components, followed by commodities such as oil and gas as wellhead as palm oil. As long as this oer-dep stopency remains, Malaysia will al slipway be exposed to the risks of the rotary nature of global ICT product exact and the speculative prices of raw materials. ground on the growth experience of industrialized economies, manufacturing has excessively already piped its optimal share of 30% contri aloneion to the Malayan GDP. In other words, conventional means of exports will continue to decline and diversification of our export wages is imperative for us to compensate for the resulting gaps. Dato Seri Najib Razaks recent announcement of however liberalization to the service sector couldnt have been much well- eond. by this, we can expect to speed up our reduction of on merchandise services while boosting our exports (in various other categories) to register a better overall bank balance. Weve only just started seeing trade unembellished for services since 2007. This would non have been possible without touristry, which contributes to al just about 50% of the services sector and Malaysias 2nd largest foreign exchange earner. Besides having an undreamed multiplier effect in terms of income and employment distribution out-of-pocket to far-reaching linkages to other sectors (construction, finance, insurance, manufacturing and so forth tourism, unlike other goods or services, has no take substitutes meaning demand for holidays is more likely to grow rather than be traded with something else. Neither is it subjected to price fluctuations affected by speculative factors like commodities for example. If the great provide of average world(prenominal) tourist expenditure equals the pr ice of the international product, prices genuine enjoy greater stability versus raw materials. In fact, prices have tended to adjoin in a stable manner due to among other things, demand for holidays and the rigidity of finishing supply in the short and medium term.tourism also has the capacity to recover foreign-currency investment in a shorter time a strong motivation for FDI inflows to the country. The UNWTO estimates that a medium-class beach hotel in a developing country will earn covering in 1 year the entire foreign exchange required to build and jibe it. In this bleak climate however, decline in international arrivals is of course expected. Unless plenteous measures are put in place to safeguard the sedulousness the impact would overwhelming on not just travel per se, but on a massive chunk of businesses that rely on tourism as a demand stimulus.There are several strike things we need to do. Firstly, we need to be extremely muged in terms of our source markets. T his recession is quickly speeding up the shift of economic power to emerging economies the result of the contrast between the excess of savings in Asia and the debt burden of Europe and North America. While it is a global d birthturn, China, India, and MENA country are silent expected to post positive growth which is a far cry from the -3% growth forecasted for developed countries.Besides ASEAN, contribution of international arrivals from these countries will make up a substantial share of our prospects. What this also means, is that our ASEAN counterparts would be vying for the resembling piece of the pie. Even more difficult is the fact ASEAN ends share their own equivalent of what Malaysia offers as a travel destination common key interests like cultural experiences, beaches and spas, historical monuments, shopping, local cuisine, sports etc.As witnessed from most communication efforts some(prenominal) regionally and globally, countries have more often than not packaged t hese attractions together in a attractively crafted montage of pictures either on television or score advertise that spells out what a destination has to offer. During a time when such demonstrations get under ones skin expected proof of value, how do we then break through the clutter and arrest the travelers attention? To do this, we need to effect ideas that mean something to them, ideas they would penury to spend their time with. Value need not necessarily mean tangible or functional attractions to a traveler alone.Rather than starting with the multitude of things a destination has to offer, we need to come along at our arrival prospects as people first and identify a fundamental need, that could be emotional or rational, before tailoring our destination to resolve them. An example of how this approach has worked lies within Tourism Malaysias own communications targeting the South and West Asian markets by JWT-Sen Media Malaysia in 2008. In India, 2 large and rapidly gro wing segments of travelers were identified honeymooners and young, affluent workings twains with kids.Surveys revealed an interesting discovery amongst newlyweds, the fact that a majority of marriages in India were still largely arranged, by choice. A honeymoon for them is akin to a couple on a first date, where an awkward tension exists between both parties. By tapping on this, we demonstrated the emotional value of a Malaysian holiday by telling a story of how a relatively unknown man called a husband becomes a close booster amplifier of a woman with each passing day, having gone through polar experiences in Malaysia together.As for young families the main motivation behind a holiday is to indulge in quality time with their family, as 55% feel they dont spend enough time with their children back home. To capture this segment, a story of a busy, successful boss who rediscovers the pop music in him was spun around a holiday experience in Malaysia. in like manner for West Asi a, we tapped on a dislodgeing that the target looked forward to the snappy feeling of water when they go on a holiday, as its a transient skeletal frame of escapism from their natural surroundings.We sought to have this feeling to life by weaving a tale close a little girl who comes to Malaysia with her parents, equipped with a tiny parasol, facial expression for cool hills and the excitement of rainand finds it. Through selling value found on fundamental people motivations instead of purely selling the destination, Malaysia post a growth of arrivals from India by 28% within the months of October to December 2008 (when the campaigns ran) versus the same period during a recession-free 2007. In the largest West Asian markets Saudi Arabia and Iran stick on an astonishing 47% and 64% growth in arrivals respectively.The question we need to ask ourselves now is what are travelers looking for in these times, and how do they want to feel? Once this has been identified its a matter of ensuring the most efficient way to reach them. While this sounds seemingly simple, the proliferation of railway lines to reach ever-changing consumers is continuing to evolve rapidly. Its no longer enough to assume threshold weight on traditional mediums like print or TV advertising alone to talk to different segments of travelers with incredibly different needs.The availability of bounteousband connections has expanded speedily in our target markets the number of Internet users in China has grown by over 40% YOY to 298 million in 2008, whereas in India, a growth of 33% was seen among urban users. Increasingly, travelers in the Asia Pacific region prefer to plan their travels online 75% of them in fact, as evidenced by the latest PATA/Visa drop dead Intentions Survey strongly catalyzed by the growth in low-cost airlines over the years, where most transactions happen online.Planning usually kicks off broad based, before honing into destinations that arrest their attention f or more focused planning. The Internet allows travelers to find what interests them more easily and connect with like-minded people in ways they never could before. Top sources for information are travel, hotel, airline websites, as well as word-of-mouth and recommendations. Where the latter stemmed mostly from family and friends in the ultimo it has found its way to be readily available in the form of travel blogs, networking sites and various other forums.The Internet as an alternative media channel is unrivalled in its targeting and accountability, providing the capability to track what people search for and where they crop and allow communications and information to be tailored specifically to travelers presumed fussy interests. The on-going advancements of the infrastructure also give much fluidity to the medium allowing the unveiling of the destination experience digitally to make travelers feel a legitimate way which is far more powerful than asking people to commemora te about the value. In the TV era, getting trial happened at the end of the marketing process now it can be the start.