Commentary

What Changi Airport, SIA and STB have to do to boost tourism

What Changi Airport, SIA and STB have to do to boost tourism
Published: 11:45 PM, April 21, 2017
Updated: 10:05 PM, April 23, 2017

Changi Airport Group (CAG), Singapore Airlines (SIA) and Singapore Tourism Board (STB) this week announced a renewal of their partnership – first forged in 2015 – to pull in more visitors to Singapore.

The three organisations have set aside S$33.75 million over the next three years.

There is a lot of synergy to be achieved in the symbiotic relationship. More importantly, they may not have a choice, as competition for tourism dollars is intensifying.

SIA’s passenger numbers have been less impressive. Annual growth has been declining in the last five years, dipping into the negative in 2014 and has since been quite flat at less than half a per cent.

Changi Airport has done well; its growth rate more than doubled last year over the preceding two years. But the challenge to keep the numbers growing looms large as it has to justify the additional capacity created when Terminal 4 opens this year and Terminal 5 in mid-2020s.

The much-vaunted Jewel project that connects the first three terminals will also add additional capacity to Terminal 1. Today Changi operates under 90 per cent of its current capacity of 66 million passengers.

Changi’s rivals are no longer confined to the South East Asian region but farther afield such as Hong Kong International and Dubai International which threaten Changi’s hub status for transfers and transits.

Hong Kong is positioning its airport as the gateway to Asia, and Dubai is attracting more airlines to connect at its hub. Not too long ago, Australia’s flag carrier, Qantas moved its Kangaroo route hub from Changi to Dubai. The growth of more direct flights between destinations also means that travellers no longer have to pass through hubs like Changi. This has affected not only Changi, but SIA as well.

Changi can still grow on the back of other carriers, but it cannot ignore the significant impact of SIA’s performance on the airport’s success.

Changi’s ambition to make the airport a destination in itself with its array of facilities has endeared it to travellers from all over the world, particularly transit passengers who typically dread a long layover.

But more often than not, the airport is incidental to a traveller’s itinerary, and this limits Changi’s appeal even as the world’s best airport.

 

NEW CHALLENGES, NEW STRATEGIES

 

There is growing recognition that the travel and tourism industry is an ecosystem, and all three entities – CAG, SIA and STB – have to not only work with one another, but also with other players, such as the hospitality industry, the entertainment sector, the art and heritage board, and event organisers.

In this challenging landscape, it becomes all the more important to promote Singapore as a destination, and STB has to work hard to boost the traveller’s preference for Singapore, whether for business or leisure.

According to their joint media release, a key initiative of the renewed tripartite partnership is the promotion of Singapore as an attractive stopover and twinning destination.

This is a step in the right direction to sell Singapore not as a single destination, but as one in a region with easy connections.

This requires reaching out to regional and international partners, through bilateral agreements and Asean connections to create experiences such as a regional food trail or a Unesco heritage themed junket through Asia.

The partnership will do well complementing, instead of competing willy-nilly, with regional attractions.

Singapore’s geographical location and state-of-the-art infrastructure are major advantages. Some regional tour operators already sell itineraries that include road trips between Singapore and Peninsular Malaysia, or boat rides to nearby Indonesian islands.

STB and SIA can certainly facilitate more short hops from Singapore as part of the twining initiative.

The joint marketing efforts will expand the previous target group of travellers from specific long-haul markets such as the United States and Europe.

This makes sense, as both Changi and SIA are experiencing higher passenger numbers from Asia. Reaching out to Tier 2 cities in China, such as Nanjing, Xiamen and Shenyang, instead of focusing only on core Tier 1 cities like Beijing and Shanghai, could reap more benefits because of the relatively untapped potential.

Similarly, provinces in India and Indonesia could be mined for greater tourism capacity.

Also the partnership plans to broaden a marketing programme to woo business and MICE (Meetings, Incentives, Conventions and Exhibitions) visitors. According to STB, the average business and MICE traveller spends two times more than the average leisure visitor, and the fall in its numbers was largely responsible for the 6.8 per cent decline in tourism receipts last year.

MICE organisers are inclined to favour unique experiences for their participants beyond mere sightseeing. While Singapore’s excellent infrastructure and facilities puts it in good stead to recover the business as the global economy improves, it harks back to the question of Singapore’s attractiveness as a destination compared to the myriad other exciting tourist spots worldwide.

A more targeted approach could also look at the demographics of the target markets, for instance, millennials and their preferences for more off-the-beaten-path attractions.

STB must think of ways to continually refresh domestic attractions, such as the Zoological Gardens and Night Safari, or Cirque du Soleil performances, Grand Prix races and various festive activities.

New attractions such as the Gardens by the Bay and a memory-lane park along the stretch of the old Malaysian railway line in the fashion of the popular High Line in New York will boost visitor numbers by attracting repeat visitors.

Singapore too certainly has the capability to host more world events.

The Free Singapore Tour which offers stopover passengers at Changi a taste of Singapore will be refreshed and expanded to cater to specific interests of the participants, such as a foodie jaunt that includes sampling of a popular local delight.

It has reportedly attracted 59,000 passengers last year, up 8 per cent from the previous year. Its popularity may encourage more passengers to choose Changi for transits and transfers even if they are not visiting Singapore. Hopefully, some will be enticed to return to Singapore for a longer visit.

One other segment with lots of growth potential is in cruises. CGA, SIA and STB can do more to promote and facilitate air-to-cruise adventures, providing seamless transfers. Such packages offered elsewhere usually include an extended land stay. This can be another form of twinning.

It is not uncommon for airlines and tourism agencies to work together. Incorporating the airport as well, the tripartite partnership of CGA, SIA and STB is a union of strengths that is quite uniquely Singapore.

 

ABOUT THE AUTHOR:

David Leo is a published author and aviation veteran.