Marketing South Africa in Canada

Transcription

1 South African Tourism Marketing South Africa in Canada First edition

2 SA Tourism is the tourism marketing organisation of South Africa South African Tourism is the official tourism marketing organisation of South Africa. We market across the world focusing on three groups of travelers international leisure travelers, domestic and regional traveler, and business tourists who travel to South Africa for conferences and incentives. A key part of our business is to: Understand the Choose the Market the market attractive segments destination This booklet has been developed from desktop research to provide an overview of the Canadian tourism market and to help market South Africa in Canada. It is the first edition for this market and marks the beginning of our efforts to better understand this tourism market. Detailed information on marketing plans can be obtained from the Regional Director: Americas (see address on back cover). Current information on arrivals from Canada to South Africa are available on our website 2 Copyright 2010 SA Tourism. Not to be reproduced without permission

3 Agenda Market Overview Travel Patterns Out of Canada Channel Current Canadian Travelers to South Africa Demographics Travel Behavior 3 Copyright 2010 SA Tourism. Not to be reproduced without permission

4 Market Overview General Statistics Canada is the fourth largest country in terms of land area. It has a strong economy, with a per capita GDP of USD 45K (over four times that of South Africa) Key Statistics Nunavut Demographics Area (Land): 9,093,507 sq. km. Capital: Ottawa Population, : million Birth rate 1 : births/1,000 population Death rate 1 : 7.74 deaths/1,000 population Life Expectancy at birth 1 : years Literacy 2 : 99% Yukon Northwest Territories Alberta Manitoba Ontario Quebec Newfoundland & Labrador Political Facts Canada, became a self-governing dominion in the middle of the 19th century, and is a constitutional monarchy. The country retains its British ties, and is a part of the Commonwealth realm Prime Minister: Stephen Harper Parliament: The parliament of Canada comprises the Senate with 349 seats; and the House of Commons with 308 seats British Columbia Saskat- chewan New Brunswick Nova Scotia Prince Edward Island Key Economic Indicators Currency: Canadian Dollar, CAD Gross Domestic Product (at current prices) GDP Value, : USD 1,499.6 billion GDP per capita, : USD 45,085.3 GDP growth rate, : 5.7% Note: estimated value; estimated value; 3 Growth rate calculated on GDP value in national currency Source: CIA World Fact book, 2009; IMF; Oanda; Grail Research Analysis 4 Copyright 2010 SA Tourism. Not to be reproduced without permission

5 Market Overview Regional Characteristics Population Nearly three quarters of the Canadian population resides in the three most populous provinces Ontario, Quebec, and British Columbia Province % of Population Total Population 1, 2009 (in Thousands) Ontario 38.7% 13,069 Quebec 23.2% 2% ,829 British Columbia 13.2% 4,455 Alberta 10.9% 3,688 Manitoba 36% 3.6% ,222 Saskatchewan Nova Scotia 3.1% 2.8% 1, New Brunswick 22% 2.2% 750 Newfoundland and Labrador Prince Edward Island 1.5% 0.4% Northwest Territories Yukon 0.1% 0.1% Nunavut 0.1% 32 Note: 1 Population as on uly 01, 2009 Source: Statistics Canada; Grail Research Analysis 5 Copyright 2010 SA Tourism. Not to be reproduced without permission

6 Market Overview Age Distribution The population of Canada is aging, with those above 50 years expected to significantly increase by 2030 Canada Population Pyramid, 2000 Canada Population Pyramid, 2010 Female Male Female Male Thousands Thousands Canada Population Pyramid, 2020 Canada Population Pyramid, 2030 Female Male Female Male Thousands Thousands Source: US Census Bureau, International Database; Grail Research Analysis 6 Copyright 2010 SA Tourism. Not to be reproduced without permission

7 Market Overview GDP and Relative Wealth Canada is among the top-fifteen economies in the world, in terms of the GDP (PPP), deriving its wealth primarily from service-based industries USD (Billion) Composition of Canada s GDP, at Basic Prices 1, 2003 and 1,400 1,200 1, % 5% 5% % 17% 68% % 1, % 6% 14% 71% 2% 3% Agriculture, forestry, fishing and hunting Utilities Mining and oil and gas extraction Construction industries Manufacturing Services-producing industries Top 20 Countries by GDP, Rank Country GDP at PPP (USD Billion) 1 United States $14,441 2 China $7,927 3 apan $4,356 4 India $3,298 5 Germany $2,918 6 Russia $2,265 7 United Kingdom $2, France $2,130 9 Brazil $1, Italy $1, Mexico $1, Spain $1, Korea $1, Canada $1, Turkey $ Indonesia $ Iran 3 $ Australia $ Taiwan $ Netherlands $677 Note: 1 The figures have been chained to the 2002 CAD values; 2 Value has been converted using average annual exchange rate of CAD 1=USD for 2003; 3 Value has been converted using average annual exchange rate of CAD 1=USD for ; 3 Estimated value Source: SCB; IMF; Oanda; Grail Research Analysis 7 Copyright 2010 SA Tourism. Not to be reproduced without permission

8 Market Overview Personal Disposable Income and Relative Attractiveness Canada has the seventh highest per capita personal disposable income in the world Per Capita Personal Disposable Income per Annum 1,2,3, 36,000 33,858 30, ,000 30,304 29,174 28,380 28,198 26,469 26,388 26,035 25,127 24,888 24,247 22,283 21,705 USD 18,000 12,000 6,000 0 USA France Germany Belgium UK Italy Canada Australia Sweden Netherlands apan Spain Greece Note: 1 Personal Disposable Income is personal income after the deduction of personal direct taxes and fees, and current transfers abroad (such as gifts); 2 The value of Annual Disposable Income has been converted from base currencies of individual countries to US dollar ($) using the average conversion rates for the year ; 3 The value of Per Capita Personal Disposable Income per annum has been calculated by dividing the Annual Disposable income for (Euromonitor International) by the respective country s population figures for (IMF) Source: Euromonitor International; IMF; Oanda; Grail Research Analysis 8 Copyright 2010 SA Tourism. Not to be reproduced without permission

9 Market Overview Vacation Participation Nearly 60% of the Canadian population go on vacations, with ~13% of them traveling abroad for holidays Percentage of Canadian Population Taking Holidays 1, 2003 Percentage of Canadian Population Taking Domestic and International Holidays, 100% 100% 13% International ti 80% 40% 40% 38% 38% 41% 43% Non-Holiday Takers 80% tage of Popula ation Percent 60% 40% 60% 60% 62% 62% 59% 57% Holiday Takers 1 tage of Total Trips Percen 60% 40% 87% Domestic 20% 20% 0% 0% Note: 1 Includes both Domestic and International tourists Source: Travel and Tourism Canada, Euromonitor International, August 2009; Euromonitor International; Grail Research Analysis 9 Copyright 2010 SA Tourism. Not to be reproduced without permission

10 Market Overview Vacation Participation by Age Groups A majority of holiday takers (~50%) in Canada are in the middle to older age group of years Canadian Holiday Takers 1 by Age, 2003 e of Holiday Takers Percentag 100% 13% 13% 80% 21% 20% 20% 60% 40% 20% 26% 26% 10% 8% 9% 10% 27% 21% 28% 14% 14% 15% 15% 22% 30% 13% 12% 12% 12% 13% 12% 23% 31% 12% 11% Over 65 years years years years years 0 14 years 15% 15% 15% 15% 14% 14% 0% Note: 1 Includes both Domestic and International tourists Source: Travel and Tourism Canada, Euromonitor International, August 2009; Grail Research Analysis 10 Copyright 2010 SA Tourism. Not to be reproduced without permission

11 Market Overview Vacation Participation by Gender The proportion of females among Canadian holiday takers slightly increased, during 2003 Canadian Holiday Takers 1 by Gender, % Female Male Percentag ge of Holiday Takers 80% 60% 40% 47.0% 53.0% 47.0% 53.0% 46.0% 54.0% 47.0% 53.0% 48.0% 52.0% 48.0% 52.0% 20% 0% Note: 1 Includes both Domestic and International tourists Source: Travel and Tourism Canada, Euromonitor International, August 2009; Grail Research Analysis 11 Copyright 2010 SA Tourism. Not to be reproduced without permission

12 Market Overview Vacation Participation by Length of Trips Short trips (0 3 days) are more common among Canadian holiday takers, however, these holiday takers are increasingly opting for longer trips (over 7 days) Length of Trips by Canadian Holiday Takers 1, % Over 7 days 20.9% 24.0% 25.5% 5% 25.7% 25.8% 26.1% 4 7 days 0 3 days 80% tage of Total Trips Percent 60% 40% 32.1% 30.3% 29.3% 29.1% 28.9% 28.9% 20% 47.0% 45.7% 45.2% 45.2% 45.2% 44.9% 0% Note: 1 Includes both Domestic and International tourists Source: Travel and Tourism Canada, Euromonitor International, August 2009; Grail Research Analysis 12 Copyright 2010 SA Tourism. Not to be reproduced without permission

13 Agenda Market Overview Travel Patterns Out of Canada Channel Current Canadian Travelers to South Africa Demographics Travel Behavior 13 Copyright 2010 SA Tourism. Not to be reproduced without permission

14 Travel Patterns Out of Canada Outbound Travel Propensity Relative to Other Countries Canada is the third largest long-haul outbound market. Overall, it is the seventh largest outbound market in the world Top 40 Outbound Markets in the World, 2005 and 2005 Million 20 0 Germ any UK USA China Russia Hong Kong Canada Fra Netherla nce Italy nds Ukraine a Me pan xico Singapore Switzerl and Sweden Romania Malaysia Belg ium Spain Korea Rep Austria Tur rkey Taiwan India Ireland Czech Norway Belarus Poland Denmark Indonesia Austr ralia Bulgaria Br Iran razil Egypt Kazakhstan Finland Hungary Top 20 Long-Haul Outbound Markets 1, 2005 and Million 10 0 USA UK Canada Germany China apan France Australia Russia Italy Brazil Sweden Rep Korea India Netherlands Belgium Spain Switzerland Israel Mexico Note: 1 The long-haul outbound data was calculated using the proportions estimated from WTO data source and applying it to the Euromonitor data. It is the closest approximation as this data is not available Source: Euromonitor; IMIS; WTO Yearbook of Tourism Statistics, 2007; Grail Research Analysis 14 Copyright 2010 SA Tourism. Not to be reproduced without permission

15 Travel Patterns Out of Canada Total Travel Volume The number of outbound trips by Canadian travelers increased by ~9% annually (2003 ), reaching 27 million in 30 Total Outbound Trips by Canadian Travelers, % ion Trips Milli Source: Tourism Flows Outbound Canada, Euromonitor International, August 2009; Grail Research Analysis 15 Copyright 2010 SA Tourism. Not to be reproduced without permission

16 Travel Patterns Out of Canada Key Long-and-Short Haul Destinations Canadian outbound travelers are nearly two times more likely to travel to USA, compared to long-haul destinations Top Outbound Destinations from Canada, % 80% 60% 40% 20% USA Short-haul haul million 34% 66% Long-haul million 39% 1% 2% 2% 3% 4% 3% 6% 6% 6% 7% 9% Others South Africa amaica India Germany Hong Kong, China Italy China Dominican Republic Mexico Cuba UK France 0% Short-Haul Destinations Long-Haul/Short-Haul Total Outbound Trips = 25.1 million 10% Long-Haul Destinations Note: 1 The proportion of long-haul and short-haul destinations is taken from UNWTO and applied to Euromonitor data Source: World Tourism Organisation (UNWTO); Tourism Flows Outbound Canada, Euromonitor International, August 2009; Grail Research Analysis 16 Copyright 2010 SA Tourism. Not to be reproduced without permission

17 Travel Patterns Out of Canada Purpose of Visit and Type of Travelers Approximately 90% of outbound trips by Canadian travelers are for leisure purpose, most of which are undertaken alone or with a partner Percentag ge of Outbound Trips Purpose of Outbound Trips by Canadian Travelers, 2003, 2005, and 100% 13.4% 12.4% 12.6% Business 80% 60% 86.6% 87.6% 87.4% Leisure 40% 20% isure Trips f Outbound Le Percentage of Type of Outbound Leisure Trips 1 by Canadian Travelers, 2005 and 100% 19.8% 21.4% 80% 1.4% 1.7% 1.6% 5.2% 1.9% 5.5% 11.5% 11.4% 60% 25.4% 24.7% 40% 20% 35.1% 33.5% Others Organised Tour Groups Backpackers Friends Families Couples Singles 0% % 2005 Note: 1 Distribution of leisure trips by type was not available for 2003 and 2004 Source: Tourism Flows Outbound Canada, Euromonitor International, August 2009; Grail Research Analysis 17 Copyright 2010 SA Tourism. Not to be reproduced without permission

18 Travel Patterns Out of Canada Length of Trips In contrast to domestic trips, international trips by Canadian travelers are usually long (over 7 days) 100% Length of Outbound Trips by Canadian Travelers, % Total Outboun nd Trips 60% 53.6% 53.5% 53.9% 55.0% 56.8% 59.7% Over 7 Days Percent of 40% 29.0% 29.4% 29.1% 28.2% 26.9% 25.0% 4 7 Days 20% 17.4% 17.1% 17.0% 16.8% 16.3% 15.4% 0 3 Days 0% Source: Travel and Tourism Canada, Euromonitor International, August 2009; Grail Research Analysis 18 Copyright 2010 SA Tourism. Not to be reproduced without permission

19 Travel Patterns Out of Canada Importance to South Africa: Arrivals from Different Countries Canada is among the top-ten long-haul travel markets 1 for South Africa, in terms of the number of arrivals. It is also the second fastest growing market for South Africa (after Brazil) Total Arrivals to SA by Market 1 (excluding Africa), 2003 and Arrivals 400 Thousands of UK USA Germany Netherlands France Australia Canada Italy India Sweden China Brazil apan CAGR (2003 )) )) 1.2% 8.9% -1.5% 1.2% 0.0% 6.9% 10.4% 2.2% 4.8% 8.4% -1.2% 15.4% 5.3% Note: 1 Only the countries covered in the study are considered Source: SAT, 2009; Grail Research Analysis 19 Copyright 2010 SA Tourism. Not to be reproduced without permission

20 Travel Patterns Out of Canada Total Canadian Travel Volume to South Africa After a decline between 1998 and 2001, Canadian arrivals to South Africa experienced continuous growth during 2002 Number of Arrivals from Canada to SA, ,000 CAGR ( ) -0.2% CAGR (2002 ) 9.1% 60,000 56,904 52,879 50,000 48,860 Num mber of Arrivals 40,000 30,000 27,539 26,989 27,531 27,401 33,684 34,692 37,170 40,818 20,000 10, Source: SAT, 2009; Grail Research Analysis 20 Copyright 2010 SA Tourism. Not to be reproduced without permission

21 Travel Patterns Out of Canada Arrivals from Canada South Africa attracts only 0.2% of the total international travelers from Canada. This proportion has remained almost constant in the growing Canadian outbound market, during 2003 Canadian Arrivals to SA 1, % Percentage Share of SA in Total Outbound from Canada Arrivals from Canada to SA Thous sands of Arriva als % % % % % % % 0.15% 010% 0.10% 0.05% anadian Outbo ound to SA Percentage C % Note: 1 Arrivals data has been sourced from SAT and percentage share of South Africa has been calculated from Euromonitor data Source: Tourism Flows Outbound Canada, Euromonitor International, August 2009; SAT 2009; Grail Research Analysis 21 Copyright 2010 SA Tourism. Not to be reproduced without permission

22 Travel Patterns Out of Canada Importance to South Africa: Economic Value The spend per trip 3 by Canadian travelers to South Africa was higher, compared to other major markets, except USA and Netherlands, in Importance to South Africa, Market Seasonality Distribution 2 Spend Per Trip Value (in Million 34 Arrivals Index 1 in SA (Rand) 3,4 Rand) 3 UK 8.3% , ,166 5,868.1 USA 53% 5.3% , ,438 4,352.7 Germany 10.3% , ,306 2,735.9 Netherlands 15.8% , ,097 1,630.2 France 10.8% , ,956 1,238.7 Canada 4.3% ,400 56, Italy 32.1% ,500 55, Note: 1 An index value of 0% represents perfect seasonality, i.e., the market is not characterised by large fluctuations from month to month. A value of 100% means that seasonality is very poor, i.e., the market is characterised by large fluctuations month by month; 2 Average number of provinces visited by all foreign tourists; 3 Total Foreign Direct Spend (excl. capex.); 4 Rounded-down to the nearest hundred Source: SAT Departure Survey, ; SAT 2009; Grail Research Analysis 22 Copyright 2010 SA Tourism. Not to be reproduced without permission

23 Travel Patterns Out of Canada Tourist Spend in South Africa South Africa s tourism industry benefited due to appreciation of the Canadian Dollar (CAD), relative to the Rand, in 10 8 Exchange Rate, Rand per CAD, 2003 Spend Per Trip 1,2 by Canadian Travelers in SA, , % 14,400 15,000 12,000 10,100 10,600 10,900 10,800 10,000 Ra and 5,000 Rand / CAD 6 4 CAD ,200 2,100 2,000 1,800 1,600 1,900 Spend Per Day 1,3 by Canadian Travelers in SA, ,200 2 Rand % Average yearly exchange rate CAD Note: 1 Total Foreign Direct Spend (excl. capex.); 2 Rounded-down to the nearest hundred; 3 Rounded-down to the nearest ten Source: SAT Departure Survey, 2003 ; OANDA; Grail Research Analysis 23 Copyright 2010 SA Tourism. Not to be reproduced without permission

24 Agenda Market Overview Travel Patterns Out of Canada Channel Current Canadian Travelers to South Africa Demographics Travel Behavior 24 Copyright 2010 SA Tourism. Not to be reproduced without permission

25 Channel Key Trends in the Canadian Travel Market Negative Impact of the Global Economic Slowdown Growth of Online Travel Retail Products The economic slowdown led to the depreciation of the Canadian The online sale of travel products in Canada grew at the rate of Dollar relative to USD, during the latter half of, thereby leading ~20%, during 2003 to a reduction in the purchasing power of the Canadians This negatively impacted both outbound and domestic tourism, as a majority of Canadians cut down their travel Retailers introduced discounts and lowered prices to promote sales in the travel retail market Recovery is expected in the Canadian travel market, as Canada hosted the Winter Olympics in 2010, thereby attracting tourists from all over the world Online sales accounted for about 29% of the total travel retail sales in Internet sales continued to gain popularity they provide flexibility, one-stop shopping experience, and consumers can save time Increased popularity of the online sales channel exerts pressure on traditional travel agencies to reduce prices The key challenge for the industry is to ensure the safety of customer information over the internet Increased Competition in the Travel Market Intense competition among tour operators, especially from smaller players, has led to a decrease in the average selling prices, despite an increase in demand According to industry sources 1, competition caused airlines to increase their capacity by ~16% in winter season of, while decrease the average selling prices by 7% Increased internet penetration and direct suppliers in the travel retail market have forced traditional agencies to lower their prices Positive Impact of Low-cost Carriers In, Westet was the only major low-cost airline in Canada, contributing ~16% to the total air transport value sales in the market Westjet implemented the lowest fuel surcharges in, giving intense competition to other airlines Air Canada, the leading Canadian airline, has been forced to lower its prices to stay competitive, indirectly benefitting the consumers Note: 1 As per Euromonitor International Source: Travel and Tourism Canada, Euromonitor International, August 2009; Travel Retail Canada, Euromonitor International, August 2009; Outbound Travel Canada, August 2009; Grail Research Analysis 25 Copyright 2010 SA Tourism. Not to be reproduced without permission

26 Channel Travel Retail Outlets The number of travel retail outlets in Canada marginally decreased during 2003 Number of Travel Retail Outlets in Canada, 2003 Num mber of Outlets 10,000 8,000 6, ,000 Exchange Services 1 Tour Operators Travel Agents -0.5% 6,839 6,772 6,711 6,724 6,704 6, ,072 1,068 1,065 1,066 1,058 1,057 5,427 5,356 5,289 5,286 5,270 5,244 2, Note: 1 Dedicated currency exchange outlets only Source: Travel Retail Canada, Euromonitor International, August 2009; Grail Research Analysis 26 Copyright 2010 SA Tourism. Not to be reproduced without permission

27 Channel Travel Retail Sales by Products Canada s travel retail products sales grew ~11% annually, during 2003, reaching over USD 18 billion 1, in. Independent bookings (flights and accommodation) accounted for 50% of the total sales US SD (Billion) Travel Retail Sales 1 in Canada by Products, % Other travel retail products Other transport Traveller s cheques City break Adventure/trekking holidays Fly-drive Cruise Spa packages Package holidays 0.4 Accommodation only Flight only Note: 1 The figures have been converted from CAD to USD using the average annual exchange rates for respective years Source: Travel Retail Canada, Euromonitor International, August 2009; Oanda; Grail Research Analysis 27 Copyright 2010 SA Tourism. Not to be reproduced without permission

28 Channel Travel Retail Internet Sales by Products The value of online travel retail sales almost doubled, during Similar to overall sales, online sales also had ~50% contribution from accommodation and flight only bookings Travel Retail Internet Sales 1 in Canada by Products, 2003 Commentary USD (Million) 8,000 6,000 4,000 2,000 0 Other travel retail online sales 2 Other transport only Car rental only Dynamic packaging Traditional package holidays Flight only Accommodation only 20.5% 4,013 3,258 1,100 2, , , ,920 1, ,091 1, ,398 1, ,188 1, The growth rate of online sales of travel retail products was almost twice that of the overall travel retail product sales, during 2003 The proportion of online sales in the travel retail market grew from ~19% in 2003 to ~29% in Key drivers for the growth of online travel retail sales are: Increasing internet penetration Convenience of time and flexibility Dynamic packaging has been the fastest growing online product, growing at ~31% annually, during 2003 Accommodation only booking, the largest selling online product, accounted for about 28% of online sales in. It grew at ~25%, during 2003 Expedia and Travelocity are the leading players in the online sales market. They further consolidated their position in through a marketing campaign Note: 1 The figures have been converted from CAD to USD using the average annual exchange rates for respective years; 2 Others include tourist attraction entrance fees, car rental hire, travel insurance, and foreign currency purchase via exchange services, which may be located within travel agents Source: Travel Retail Canada, Euromonitor International, August 2009; Oanda; Grail Research Analysis 28 Copyright 2010 SA Tourism. Not to be reproduced without permission

29 Channel Travel Retail Products: Top Players The Canadian travel retail market is fragmented, with the top ten players accounting for only ~36%, in Percenta age of Retail Value Canadian Travel lretail ilproducts Market tshare, 2004, 2006, and 100% 63.7% 0.2% Others 0.3% Thomas Cook Travel 69.8% 70.2% 1.2% 0.8% Ltd Canada 1 30% 20% 10% 0.8% 1.0% 0.1% 0.2% 0.9% 2.0% 1.0% 2.2% 1.6% 5.0% 5.8% 2.3% 3.0% 3.6% 5.1% 4.8% 0.9% 0.1% 0.3% 0.8% 0.9% 13% 1.3% 2.5% 3.7% 5.6% 5.7% 6.2% 9.6% 8.8% 8.0% MyTravel Group Plc 2 Air Canada Vacations Signature Vacations Inc Canadian Automobile Association itravel2000.com Thomas Cook Group Plc 2 Travelocity.ca Flight Centre Ltd Transat AT Inc Expedia.ca Carlson Wagonlit Canada American Express Co Commentary Canada s travel retail market is fragmented. Market share of the top ten players grew from ~30% in 2004 to ~36%, in American Express Co., was the largest player in the travel retail products market space, with a ~9% share of the total sales, in Transat AT Inc., a leading company in the travel retail sector, increased its market share from ~2% in 2004 to ~6% in It assembles tour packages through Transat Tour, and sells them through Transat Distribution Canada The Thomas Cook Group 2, another leading retailer, acquired the travel wholesaler, Triwest Travel Holdings, in, to diversify from the highly competitive tour operating segment 0% Note: 1 Thomas Cook, Canada was sold to Transat A.T. Inc in 2006; 2 MyTravel Group plc merged with Thomas Cook AG to form Thomas Cook Group plc, in 2007 Source: Travel Retail Canada, Euromonitor International, August 2009; Grail Research Analysis 29 Copyright 2010 SA Tourism. Not to be reproduced without permission

30 Channel Scheduled Flights to South Africa There are no direct flights between Canada and South Africa; however, since other European travel hubs are well connected with South Africa, indirect flights are easily available Flight Routes from Canada to SA 12 1,2 Toronto London Amsterdam Frankfurt Zurich Atlanta e2 Note: 1 Flights with two or more stops have not been shown; 2 Assuming flights from Canada to South Africa for May 17 May 23, 2010, as checked on March 11, 2010 Source: Expedia; Grail Research Analysis Cape Town ohannesburg 30 Copyright 2010 SA Tourism. Not to be reproduced without permission

31 Slide 30 e2 Need to add NYC and Washington DC as connecting points as well evelyn, 4/13/2010

32 Agenda Market Overview Travel Patterns Out of Canada Channel Current Canadian Travelers to South Africa Demographics Travel Behavior 31 Copyright 2010 SA Tourism. Not to be reproduced without permission

33 Current Canadian Travelers to South Africa: Demographics Age Distribution The Canadians traveling to South Africa have a fair distribution of different age groups Canadian Travelers to SA by Age, 2003 nt of Travelers Perce 100% 80% 60% 40% 9% 17% 19% 23% 15% 16% 18% 18% 11% 9% 11% 11% 20% 20% 20% 22% 21% 15% 19% 22% 15% 17% 18% 15% 65+ years years years years years years 20% 28% 23% 23% 23% 22% 20% 0% 10% 10% 9% % 10% 11% Source: SAT Departure Survey, 2003 ; Grail Research Analysis 32 Copyright 2010 SA Tourism. Not to be reproduced without permission

34 Current Canadian Travelers to South Africa: Demographics Gender Distribution A majority of Canadian travelers to South Africa are males, with slightly higher proportion than female travelers Canadian Travelers to SA by Gender, % Female Male 80% 46% 41% 44% 44% 51% 47% Percen nt of Travelers 60% 40% 20% 54% 59% 56% 56% 49% 53% 0% Source: SAT Departure Survey, 2003 ; Grail Research Analysis 33 Copyright 2010 SA Tourism. Not to be reproduced without permission

35 Current Canadian Travelers to South Africa: Demographics Income Distribution The proportion of high income earners (earning more than R20,000 per month) traveling from Canada to South Africa increased from ~67% in 2003 to ~85% in Canadian Travelers to SA by Income Category (Monthly Income in Rand), % 80% 14% 10% 19% 23% 11% 14% 12% 19% 10% 16% 4% 10% < R10,000 R10,000 to R19,999 R20,000 to R39,999 R40,000 34% Percen nt of Travelers 60% 40% 35% 35% 44% 39% 34% 20% 40% 32% 32% 32% 30% 51% 0% Source: SAT Departure Survey, 2003 ; Grail Research Analysis 34 Copyright 2010 SA Tourism. Not to be reproduced without permission

36 Current Canadian Travelers to South Africa: Demographics Occupation A majority of Canadians traveling to South Africa are professionals, with their proportion having increased from 47% to 56%, during 2003 Canadian Travelers to SA by Occupation, 2003 Percen nt of Travelers 100% 18% 17% 14% 18% 6% 80% 9% 10% 9% 12% 10% 12% s7% 60% 17% 16% 14% 16% 40% 15% 8% 12% 13% 11% 7% 10% 15% Others Student Executive - Managerial Retired - pensioner Professional 20% 47% 45% 53% 49% 52% 56% 0% Source: SAT Departure Survey, 2003 ; Grail Research Analysis 35 Copyright 2010 SA Tourism. Not to be reproduced without permission

37 Current Canadian Travelers to South Africa: Demographics City of Residence Toronto and Vancouver accounted for the highest proportion of Canadian travelers to South Africa; however, there was slight increase in the number of travelers residing in other Canadian cities Major Cities of Residence of Canadian Travelers to SA, 2003 nt of Travelers Perce 100% 12% 3% 14% 3% 22% 18% 1% 20% 19% 3% 3% 1% 3% 80% 3% 3% 2% 2% 2% 1% 2% 1% 4% 1% 8% 4% 4% 2% 5% 3% 2% 4% 8% 8% 9% 3% 19% 12% 60% 9% 8% 8% 11% 9% 8% 5% 7% 10% 16% 40% 14% 16% 15% 16% 14% 1% 1% 1% 2% Others London Winnipeg Ontario Quebec Edmonton Calgary Ottawa Montreal Vancouver Toronto 20% 36% 34% 30% 32% 34% 31% 0% Source: SAT Departure Survey, 2003 ; Grail Research Analysis 36 Copyright 2010 SA Tourism. Not to be reproduced without permission

38 Agenda Market Overview Travel Patterns Out of Canada Channel Current Canadian Travelers to South Africa Demographics Travel Behavior 37 Copyright 2010 SA Tourism. Not to be reproduced without permission

39 Current Canadian Travelers to South Africa: Travel Behavior Summary Canadian travelers contributed over R3 billion to the South African economy, during The average contribution by a business traveler 1 was higher than by other visitors General Holiday VFR Business Traveler 1 Business Tourists All Canadian Arrivals Total Volume ( 03 08) 150,037 42,153 39,783 15, ,699 TFDS (excl. capex) 2 ( 03 08) (in billion) R1.58 R0.41 R0.58 R0.16 R3.03 Value / Volume Index ( 03 08) N / A Spend / Day 3 ( 03 08) R660 R410 R710 R1050 R580 Total Prepaid Spend ( 03 08) (in billion) TFDS (excl. capex) 2 to Prepaid Spend ( 03 08) R3.35 R0.57 R0.90 R0.27 R Average Length of Stay Average Number of Provinces Visited ( 03 08) Note: 1 Business: A trip which is undertaken to conduct commercial or formal transactions or activities that are related to a person s job, e.g., visiting a client, signing deals, negotiating a contract (including import / export), etc.; 2 Total Foreign Direct Spend (excl. capex.); 3 Roundeddown to the nearest ten Source: SAT Departure Survey, 2003 ; Grail Research Analysis 38 Copyright 2010 SA Tourism. Not to be reproduced without permission

40 Current Canadian Travelers to South Africa: Travel Behavior Purpose of Visit A majority of Canadian travelers visit South Africa for holidays, with business travel 2 being the fastest growing purpose of visit Primary Purpose of Visit of Canadian Travelers to SA, 2003 and Perce entage of Arriv vals 100% 75% 50% 4% 8% 14% 16% 8% 4% 15% 20% 58% 25% 53% Other 1 Business Tourist VFR Business Traveller 2 Holiday Perce entage of Arriv vals Percent of Canadian Arrivals to SA by Purpose, 2003 Combined 75% 60% 56% 45% 30% 16% 15% 15% 6% 7% 0% Holiday VFR Business Traveller 2 Business Tourist Other 1 0% 2003 CAGR (2003 ) 7.5% 10.8% 14.6% -5.9% 24.9% Note: 1 Other includes visitor categories, Shopping Business, Shopping Personal, Medical, Religion and Others ; 2 Business: A trip which is undertaken to conduct commercial or formal transactions or activities that are related to a person s job, e.g., visiting a client, signing deals, negotiating a contract (including import / export), etc. Source: SAT Departure Survey, 2003 ; Grail Research Analysis 39 Copyright 2010 SA Tourism. Not to be reproduced without permission

41 Perc cent of Travele ers Current Canadian Travelers to South Africa: Travel Behavior Travel Partner Canadian travelers usually visit South Africa alone or with their spouse/partner. The proportion of Canadian visitors, traveling alone, further increased during 2003 Percentage of Canadian Travelers to SA by Travel Partners, % 3% 7% 4% 4% 3% 2% 7% 7% 5% 5% 4% Children under 18 years 7% Colleagues/associates 9% 8% 9% 8% 10% Tour group 8% 80% 4% 7% 6% Family/children 5% 6% over 18 years 11% 7% 7% 8% 10% 8% Friends 60% 40% 31% 26% 33% 34% 30% 29% Spouse/partner Alone 20% 38% 42% 36% 33% 39% 41% 0% Source: SAT Departure Survey, 2003 ; Grail Research Analysis 40 Copyright 2010 SA Tourism. Not to be reproduced without permission

42 Current Canadian Travelers to South Africa: Travel Behavior Length of Stay The length of stay of a majority of Canadian travelers to South Africa decreased from 14 days in 2003 to 6 days in Length of Stay of Canadian Travelers in SA, Average Length of Stay Most Common Length of Stay Num mber of Nights Source: SAT Departure Survey, 2003 ; Grail Research Analysis 41 Copyright 2010 SA Tourism. Not to be reproduced without permission

43 Current Canadian Travelers to South Africa: Travel Behavior Spend per Trip/Prepaid Spend Average prepaid spend by Canadian travelers to South Africa grew at higher rate to reach twice the value of average spend per trip, in 2007 Average Prepaid Spend by Canadian Travelers to SA 1, 2003 Average Spend Per Trip (TFDS excl. Capex) 1,2 by Canadian Travelers to SA, ,000 18,000 id Spend (in Rand) Prepa 32,000 24,000 16,000 8,000 18,600 17,100 18, % 19,100 24, ,400 Rand) TFDS excl. capex (in 13,500 9,000 4,500 12,000 10, % 10,600 10,900 10,800 14, Mean = R21,400 Mean = R11,500 Note: 1 Rounded-down to the nearest hundred; 2 Total Foreign Direct Spend (excl. capex.) Source: SAT Departure Survey, 2003 ; Grail Research Analysis 42 Copyright 2010 SA Tourism. Not to be reproduced without permission

44 Current Canadian Travelers to South Africa: Travel Behavior South African Package Tour Types A majority of Canadian leisure travelers are independent travellers 100% Channel for Purchasing Independent Deals 2,3, 0.3% 4.2% 3.2% Package Type Purchased by Canadian Leisure Travelers to SA 1,2, 100% Channel for Purchasing Packaged Deals 2,3, 0.4% 7.0% 4.9% 2.6% 5.0% 7.0% 75% 53.0% 33.5% 0.2% Independent 66% 75% 50% 47.0% 50% 88.1% 85.0% 25% 42.8% Package 34% 25% 0% Airline 15.8% Accommodation Directly with Airline Direct with Airline via Internet Didnt pay/stay with family/friend Tour operator Airline Directly with place of accommodation Travel agent Note: 1 Package refers to the following: Full Package = Flight, Accommodation, Car hire and Food; Fully Inclusive Package = Flight, Accommodation, Food and Coach; Package = Flight, Accommodation, and/or Car hire; Independent = Separate booking for Flight, Accommodation, Car hire, Coach and Food; 2 Includes only travelers whose primary or secondary purpose of traveling is holiday; 3 Data has been re-proportioned to make the total equal to 100% Source: SAT Departure Survey, ; Grail Research Analysis 0% Accommodation 43 Copyright 2010 SA Tourism. Not to be reproduced without permission

45 Current Canadian Travelers to South Africa: Travel Behavior Activities Undertaken Visiting natural attractions and watching wildlife are the most common activities 1 of Canadian travelers in South Africa Volume of Canadian Travelers to SA by Activity 1, 2003 Combined ) Volume of Can nadian Tourist ts (Thousands Visiting natural attractions Wildlife Cultural, historical and heritage Beach Social Theme parks Business Visited a Casino Adventure 11 Sporting 5 Medical Health Education/ Trading training/study 1 Hunting Note: 1 Excludes Shopping and Nightlife Source: SAT Departure Survey, 2003 ; Grail Research Analysis 44 Copyright 2010 SA Tourism. Not to be reproduced without permission

46 Current Canadian Travelers to South Africa: Travel Behavior Reasons for Satisfaction Exploring scenic beauty and wildlife/game-park experience are the most common reasons for satisfaction among Canadian travelers to South Africa Top 15 Reasons for Satisfaction Among Canadian Travelers to SA, 2004 Combined 1 Scenic beauty 89 Wildlife / Game-park / Safari Friendly people / Hospitality Visiting friends / family Culture and Heritage Diverse experience Business opportunities Beach Good service Weather/climate Resturants / Food / Wine Good infrastructure Sport Value for money Attractions Volume of Canadian Tourists (Thousands) Note: 1 The question regarding best experience was introduced in 2004, hence, the data has been presented for 2004 Source: SAT Departure Survey, 2004 ; Grail Research Analysis 45 Copyright 2010 SA Tourism. Not to be reproduced without permission

47 Current Canadian Travelers to South Africa: Travel Behavior Province Visited Western Cape and Gauteng are the most widely visited provinces by Canadian leisure travelers SA Provinces Visited by Canadian Leisure Travelers 1, 2003 Combined Northern Cape 4.7% Gauteng 52.5% Northwest t 8.2% Free State 6.4% Limpopo 7.2% Mpumalanga 33.7% KwaZulu Natal 30.7% Percent of Travelers Western Cape 64.1% Eastern Cape >50% 21.6% 10-50% <10% Note: 1 Includes travelers whose primary or secondary purpose of traveling is holiday Source: SAT Departure Survey, 2003 ; Grail Research Analysis 46 Copyright 2010 SA Tourism. Not to be reproduced without permission

48 Current Canadian Travelers to South Africa: Travel Behavior Accommodation Type by Province A majority of the Canadian leisure travelers to South Africa prefer to stay in paid accommodation, particularly in the Mpumalanga and Northern Cape provinces Geographic Spread of Canadian Leisure Travelers 1 to SA by Accommodation Type, 2003 Combined 100% 80% 40% 27% 28% 45% 11% 30% 20% 14% 49% Percenta age of nights 60% 40% 20% 60% 73% 72% 55% 89% 70% 80% 86% 51% 0% Gauteng Western Cape Eastern Cape KwaZulu Natal Mpumalanga Limpopo North West Northern Cape Free State Unpaid Accomodation Paid Accomodation 2 Total Nights Spent in Province, 2003 Combined % of Total Nights (2003 ) 17.2% 39.8% 8.3% 18.4% 9.3% 2.8% 1.5% 1.1% 1.5% Note: 1 Includes travelers whose primary or secondary purpose of traveling is holiday; 2 Paid accommodation includes all accommodation types except for staying with friends and family Source: SAT Departure Survey, 2003 ; Grail Research Analysis 47 Copyright 2010 SA Tourism. Not to be reproduced without permission

49 Current Canadian Travelers to South Africa: Travel Behavior Other African Countries Visited Zimbabwe, Zambia, and Botswana are the most widely visited African countries by Canadian leisure travelers to South Africa Other African Countries Visited by Canadian Leisure Travelers to SA 1, 2003 Combined Morocco Tunisia Western Sahara Algeria Libya Egypt, Arab Rep. >10% 4% 10% 1% 4% Mauritania Mali Senegal Niger Chad Sudan Eritrea Gambia Burkina Faso Guinea-Bissau Guinea Benin Nigeria Djibouti Ghana Sierra Leone 0.3% Ethiopia Liberia Cote Togo Cen. Afr. Rep. Cameroon d'ivory Uganda Kenya Equat. Guinea CongoDem. Rep. 34% Gabon Congo Rwanda 3.4% Percent of Travelers Not mentioned / Score below 1% Note: 1 Includes travelers whose primary or secondary purpose of traveling is holiday Source: SAT Departure Survey, 2003 ; Grail Research Analysis Burundi Tanzania 3.6% Somalia Seychelles Malawi Angola 1.5% Zambia 0.1% 10.2% Mozambique Zimbabwe 3.0% Madagascar Botswana 10.4% 10.3% Swaziland Mauritius 5.6% Namibia 7.7% South Africa Lesotho 2.2% 48 Copyright 2010 SA Tourism. Not to be reproduced without permission

50 Current Canadian Travelers to South Africa: Travel Behavior Seasonality of Travel: Canada vs. USA Canadian arrivals to South Africa witnessed higher monthly fluctuations, compared to arrivals from USA and all markets (combined), during 2006 Canada, USA, and All Markets Arrivals Monthly Index, Canada to Average Arr rivals per Month 0.0 USA All Markets Indexed t -0.5 F M A M A S O N D F M A M A S O N D F M A M A S O N D Annual Seasonality Index 2 Canada 4.49% 2.84% 4.27% All Markets 1.19% 1.11% 1.44% USA 2.58% 2.84% 5.34% Note: 1 An index value of 0% represents perfect seasonality, i.e. the market is not characterised by large fluctuations from month to month. A value of 100% means that seasonality is very poor, i.e. the market is characterised by large fluctuations month by month Source: SAT, 2009; Grail Research Analysis 49 Copyright 2010 SA Tourism. Not to be reproduced without permission

51 Current Canadian Travelers to South Africa: Travel Behavior Seasonality of Travel: Purpose of Visit Seasonal Patterns of Canadian Travelers to SA by Purpose of Visit, 2006 to average vals indexed t onthly arrivals Monthly 1 arri mo Holiday Business Traveller Business Tourist VFR -1.5 F M A M A S O N D F M A M A S O N D F M A M A S O N D Note: 1 Month of taking the survey Source: SAT Departure Survey, 2006 ; Grail Research Analysis 50 Copyright 2010 SA Tourism. Not to be reproduced without permission

52 Current Canadian Travelers to South Africa: Travel Behavior Seasonality of Travel: Province Seasonality by Province, 2006 Gauteng Western Cape Eastern Cape KwaZulu Natal All Provinces 3 Monthly 1 Arri ivals Indexed to Averag e Monthly Arriv vals F M A M A S O N D F M A M A S O N D F M A M A S O N D Province Average difference between peak and low month (Arrivals) Gauteng 1,980 Western Cape 2,481 Eastern Cape 939 Mpumalanga Limpopo North West Northern Cape Free State All Provinces KwaZulu Natal 1,138 5 Mpumalanga 1,499 Month hly 1 Arrivals Indexed d to Average Month hly Arrivals Limpopo 617 North West 460 Northern Cape 539 Free State F M A M A S O N D F M A M A S O N D F M A M A S O N D Note: 1 Month of taking the survey Source: SAT Departure Survey, 2006 ; Grail Research Analysis 51 Copyright 2010 SA Tourism. Not to be reproduced without permission

53 For more information contact our head office : Regional Director: Americas South African Tourism Private Bag X10012 Sandton ohannesburg 2146 Tel: ; Fax: info@southafrica.net Website: