TAT tells businesses to focus on quality, not worry about Russian decline

0
811

With the number of Russian visitors to Pattaya continuing to fall, tourism officials are telling local businesses to stop focusing on stats and focus more on improving their offerings for tourists in other markets.

After two months of 20-percent-plus declines in the number of Russian arrivals in Thailand, it’s become apparent that Pattaya cannot depend on the ruble to power its high season this year. The Russian currency has fallen more than 50 percent in the past year versus the dollar, sapping any ability of most Russians to travel overseas.

Pattaya Beach still sees a large number of tourists despite the weakening of the ruble.Pattaya Beach still sees a large number of tourists despite the weakening of the ruble.

Sanphet Suphabuansathien, president of the Thai Hotels Association Eastern Region, estimated Russians last year held a 30 percent share of Pattaya’s tourist market.

The impact on Pattaya has been profound.

Russian arrivals in Thailand fell 4.9 percent from January – November last year – the most recent statistics that are available – with 1.4 million visitors coming to the kingdom. That’s down only about 90,000 from the same period in 2013, but December’s numbers are expected to see that gap grow.

Arrivals tumbled 21.2 percent in November to 181,888 visitors, after plunging 23.2 percent to 115,197 tourists in October, according to the Ministry of Tourism and Sports’ Department of Tourism.

“The crisis in Russia this year is expected to cut about 16.5 billion of Thailand’s revenue from Russian tourists relative to normal,” a recent economic review predicted.

Sinchai Wattanasartsathorn, president of the Pattaya Business & Tourism Association said in a recent television interview that the decline has put the brakes on Pattaya’s tourism industry, as well as its real estate sector, as many Russians had become property investors.

However, he vowed, Pattaya will find ways to make the city an attractive place for holidays and investing for other nationalities.

Tourism Authority of Thailand Pattaya office director Suladda Sarutilavan urged business owners not to worry too much about the Russian decline, but instead turn crisis into opportunity.

She said they should review their product offerings and services to find ways to improve or adjust to the needs of the tourists that are here or can still afford to come to Pattaya.

Not just the ruble

Pattaya’s tourism problem is about more than just the ruble. The city has lost market share to other destinations, such as Phuket, whose international airport offers direct flights to Moscow and Vietnam.

In addition, calmer political climates in Egypt and Turkey have Eastern European tourists returning to their traditional vacationing spots, closer to home than Thailand.

About 20 percent of small travel agents in Russian also have closed due to the currency crisis, which also diminishes chances of booking Thai holidays.

However, Suladda said, every crisis is an opportunity if businesses learn to adapt to the situation and seek new opportunities to sustain their operations.

Juthaporn Rerngronasa, deputy governor for international marketing at the TAT, admitted that the number of Russian tourists for 2015 is expected to total about 1.6 million, a 7 percent decrease from 2013.

Originally, TAT expected it to be 1.9 million in the first 11 months of 2014. But while official numbers had yet to be released for December, simply looking at the number of charter flights booked indicates Thailand has lost market share to Vietnam, he said.

Juthaporn estimates Russian arrivals in Thailand will drop15-20 percent in the first quarter as the total number of Russians traveling overseas plummets 30-50 percent.

Beach chair vendor Siritiport Satchukorn says that the Russian decline undermines an already weak European market. Russians, she said, were irregular customers. The regular customers are those from Norway and other northern European countries who traditionally stay in Thailand for months.

She said now her Norwegian customers have cut their visits in half. She said many operators – already faced with new restrictive operating regulations – are considering laying off employees due to reduced revenue.

TAT said it is working to help Thai businesses affected by the tourism slowdown.  The organization plans to promote Pattaya as a family holiday destination for weekend Thai travelers and target large factories looking for places for their staff’s recreational activities or places for seminars.

TAT also will attend the Thailand Tourism Festival and the Thais Tour Thai event for domestic marketing, and attend trade shows in India and Germany. They also will hold road shows in Indonesia, China, South Korea and Eastern Europe, which are potential markets that could counter the Russian decline.