Focus, preparations and homework lacking to tap the world’s biggest tourism market

Kathmandu

American tourists have shown a consistent growth in arrivals to Nepal. However, this growth is organic and not due to marketing campaigns or promotional interventions. These tourists travel to Nepal mainly for adventure, mountaineering and trekking which is uniquely available here. Further, it is observed that tourists who are here for adventure tourism spend their entire vacation in the country. Most American tourists who visit Nepal feel so connected to the natural beauty and culture that they also keep coming back.

Even though Nepal is rich in cultural and geographical diversity that fascinates Americans, the tourism industry has not been able to really tap into this long haul and high yield market that offers huge potential. The US tourist market consistently stands in the third position after India and China, for Nepal.

Market significance

“I believe most American tourists come to Nepal to experience the astounding natural beauty of this country. They are interested in trekking and visiting places like Pokhara and the Annapurna range” says Ineka Stoneham, Spokesperson, US Embassy. She adds that once they are here, most also become fascinated with the culture and the warm, wonderful Nepali people.

There are two distinct types of American travellers to Nepal. “One type is interested in the culture of Nepal and can typically be found to bundle their trip with India or Thailand and the others are adventure tourists,” says Ashok Pokharel, President of Nepal Association of Tour Operators (NATO). American arrivals, before the onslaught of the Chinese tourists, were consistently the second highest for decades. He also says, “Long haul travellers, as a rule, spend more than short haul travellers in one place. When adventure travel is thrown into the equation then the spending is much higher per traveller.”

The majority of American travellers tend to travel close to home according to a research by Euro monitor international. The most popular destinations for Americans are Mexico, Canada and Britain and they spend the most on accommodation followed by food and shopping. “The US market includes diverse cultures, there are many Non Residential Indians in California and other states. These pocket segments who already know Nepal should be encouraged to visit Nepal,” says Upaul Majumdar, General Manager at Soaltee Crowne Plaza. “However, proper market research and planning is a must before carrying out any marketing campaigns in any destination,” he adds.

While the American market does hold great significance and potential for the Nepali tourism industry, the problem has always been that Nepal Tourism Board (NTB) and the travel trade have not been able to market and promote brand Nepal in an effective manner.

US Sales Mission

Two months back, NTB organised a US Sales Mission in Washington DC, Phoenix, Denver, Los Angeles, San Fransisco and Seattle. The Sales Mission was headed by Secretary of the Tourism Ministry Prem Kumar Rai. Deepak Raj Joshi, CEO, NTB, Sudan Subedi, Officer, NTB and Ghanashyam Upadhyaya, Joint Secretary-Tourism Ministry were the representatives from the government’s side. Some travel agencies also paid to participate in the mission. The total investment in the US sales mission was estimated to be Rs seven million by NTB.

“We share one of the best diplomatic relations with the US government. Further, American travel agencies have been promoting Nepal since the 1950s, so this market cannot be ignored,” shares Deepak Raj Joshi, CEO of NTB. “We ventured into the US market after a long break. The main objective of this mission was to convey the message that we are back in business and fully operational,” he says.

The 14-day long programme had media briefing sessions and business to business (B2B) sessions between US and Nepali travel trade. When asked about the impact of the mission he says, “This year we expect around 50,000 arrivals from the US. From 2017 we expect a growth of five to 15 per cent in the arrivals.” That may seem like a decent expectation but to make it a reality hard work, focused promotion, planning and follow up coordination is required. And while delegations are quick to go abroad for such programmes the follow up is often lacking.

Challenges to overcome

“Ten times more Americans visit Taiwan than Nepal. Just 50,000 Americans a year visiting Nepal is not a very big number relative to our country’s population,” Stoneham says. Nepal as a destination faces stiff competition for US visitors. One way to compete with other tourism markets would be to diversify and attract more than just the young backpackers who spend very little per day. She continues, “Another challenge is uncertainty.  Unless they know a reputable tour operator in advance, it can be difficult for Americans to plan and reserve hotels, treks, and internal flights before getting here. If credit cards were more widely accepted (especially without a 3.5 per cent fee), that would also help.” Other challenges include transportation between cities and flights being delayed or canceled because of weather and road closures due to landslides or flooding.

“Many Americans rely on the internet when they research travel plans. Sites like TripAdvisor, Yelp and AirBNB offer a wealth of information about hotels, restaurants, and other traveller’s experiences,” mentions Stoneham. She shares, “In fact, I recently had guests who decided on their Chitwan accommodations by checking TripAdvisor for the top ranked hotel.”

In today’s digital world there are many possibilities to directly connect and communicate with the consumer and convey the message that ‘Nepal is back to business’. However, NTB does not seem to active in this area. That’s probably why many in the travel trade have reservations about the desire to follow the conventional method of promotions by sending officials for road shows when other methods of communication are lacking.

Further, industry experts also claim that for the revival of tourism, regional tourists especially from India and China who are also now affluent spenders should be the main focus and marketing and promotion focussed on these countries.

Talking about the use of innovative marketing strategies for promotions, Shraddha Shrestha, Senior Officer of Brand Promotion and Corporate Marketing at NTB, says, “Travel associations and agencies come up with proposals and we facilitate it.” She adds, “We are also working towards improving our digital marketing and increasing our online presence.”

The way ahead

Further, improvement in air connectivity is required to attract the US market. Pokharel says, “It may be a little premature to suggest things like direct flights but, we could promote code shares, charters and better connecting times at hub airports like Singapore, Bangkok, Hong Kong, Dubai, Doha, Abu Dhabi, et cetera.”

“We also need to substantially ramp up our promotional activities to align them with our goals. If our aim is to make money from tourism then we must pursue that goal in the biggest market,” he says. Pokharel says that even today 25 per cent of all air tickets are issued in the US and the value

proportion of all airline sales is higher than that. While other countries may generate more tourists, he feels it is wise to pursue markets with the highest yield.

However, what almost all stakeholders agree to is the fact that in order to brand and market destination Nepal,  proper research and data is a prerequisite. The promotion authority and the tourism industry lacks research on various markets and has a vague idea of what these travellers want and need. They might be targeting the right markets; however, without enough homework the efforts may not provide the desired results.

“Many Americans rely on the internet when they research travel plans. Sites like TripAdvisor, Yelp and AirBNB offer a wealth of information about hotels,

restaurants, and other traveller’s experiences”

Ineka Stoneham

Spokesperson, US Embassy

“We also need to substantially ramp up our promotional activities to align them with our goals. If our aim is to make money from tourism then we must pursue that goal in the biggest market”

Ashok Pokharel

President of NATO

“This year we expect around 50,000 arrivals from the US. From 2017 we expect a growth of 5 to 15 per cent in the arrivals”

Deepak Raj Joshi

CEO, NTB