Seeking the smart money

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Super City mayor Phil Goff has a plan for getting money from tourists - it bears some similarity to that of the Mongrel Mob.

Amid talk of hotel taxes and tourist levies, Winston Aldworth says New Zealanders must smarten up.

By Winston Aldworth

What do Phil Goff and the Mongrel Mob have in common?

As hundreds of travel industry figures from all around the world gathered in Auckland for last week's Trenz conference, one of the many topics up for discussion was the Auckland mayor's enthusiasm for a hotel bed tax on visitors to the city.

Meanwhile, up north at Ahipara on Ninety Mile Beach, three German tourists were approached by two local Mongrel Mob members who told them that they were on Maori land, and had to pay koha. They also told the tourists they'd be taking a few of their cigarettes. A tobacco tax, if you will. Perhaps their plan for putting heavy taxes on visitors was inspired by the Super City mayor.

Goff's bed tax is about as blunt an instrument as the Mob's shakedown. "Look there's a foreigner! Let's get a couple of bucks off them." The airport tax introduced by John Key a year ago is equally clumsy.

It's a travesty that these tariffs are the best we can come up with for making money out of tourism. Yes, other countries put dull levies on visitor arrivals, but that's no reason to follow suit. We New Zealanders pride ourselves on being innovators, so let's find innovative ways to get more money out of the tourism sector. Both Goff and Key were ministers in governments that did everything they could to remove tariffs from the dairy trade. Today, the best and brightest marketing wallahs of Goff's inner circle are putting forward a plan no more sophisticated than one devised by two Mongrel Mob members standing on a Northland beach.

Super City mayor Phil Goff. Photo / Greg Bowker
Super City mayor Phil Goff. Photo / Greg Bowker

I'm not against making money out of tourists — quite the opposite, in fact. I think it's terrific that our country can be boosted by an industry that encourages us to care for our environment, celebrate the things that make our culture unique and spreads revenue quickly and efficiently to the regions.

But how about instead of putting a dumb tax on the visitors, we upsell them? Take their money at the gate for sure, but give them something special in return.

Continued below.

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How about every tourist arriving in New Zealand gets membership of a club — it's a digital thing that offers them discounts around the country. And yes, it costs money; and yes, it's compulsory.

The discounts and incentives in the digital product (which could take the form of an easy-to-use app on your phone) could be stronger in regions that we're wanting people to visit.

So you get nothing for going to Queenstown (it's already full), but pull up in Hokitika and there's a fresh flat white waiting for you and a 20 per cent discount on a motel for the night. Dargaville? Two coffees and a 30 per cent discount. Think of it as a loyalty card for the whole country.

When visitors return to New Zealand, they reactivate the app and get even better incentives. My local gym recently had an incentive scheme that would have seen me get a free pair of sneakers if a friend of mine joined. Let's do the same thing with New Zealand tourism: Bring a fellow traveller with you who hasn't been here before and there's 20 per cent off your airfare.

We would make money up front — charging people for the package when they arrive. But the real value would be in data-mining. The vast majority of tourists arrive here with very flash electronic gadgets — by getting them hooked into a digital membership like this we can track and analyse how and where they spend their money around the country.

Tourism New Zealand could make use of the data in its marketing and infrastructure-funding decisions could be based on hard numbers, not hopeful hunches.

Best of all, the Government could then sell targeted data to Kiwi tourism operators throughout the country and the overseas retailers that send people here.

Don't just slap a lazy tariff on people. Give them something in return. And for crying out loud, don't steal their cigarettes.

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7 Comments

Question

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10:19 am Friday 19 May 2017
You are going to charge the tourists for an app while mostly private providers have to sell their services at a discount or give them away? The residents of many countries are known for their bargaining skills so might decide to save on the app while negotiating their own discounts. You are correct about the limited vision of Geoff though & the concept of a smarter tax that appears to offer value is a good idea.

IA

- St Marys Bay
10:19 am Friday 19 May 2017
I think we make enough out of tourists by way of income tax and GST on their spending without a targeted tax as well. The tourism industry is always trying to find more ways to get tourists to spend and when they are successful, the tax take increases too. A proper study on the subject by an economist will be of more value than knee jerk reactions.

Craggsy

- Kamo
10:18 am Friday 19 May 2017
What an awesome idea! You should patent this idea and sell it to Tourism NZ. This is the kind of thinking we need to stand out. I would totally go for this if I was an overseas traveller.

Anthony

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10:18 am Friday 19 May 2017
All great ideas but how do we pay for the infrastructure to handle the increasing numbers. The roads, the waste disposal, the policing, medical care, the port facilitates and even clean water supply or outlet control to streams. All these services are stretched now only to be put under more pressure, unless huge amounts of money are to be invested.

KiwiCoastal

- Thames
10:17 am Friday 19 May 2017
Interesting idea for a compulsory "club" for tourists to help encourage them elsewhere than the hot spots. BUT discounting is never a winning strategy for any business. Instead we need to add value, not discount.

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10:17 am Friday 19 May 2017
Ever thought of running for Mayor? A brilliant marketing strategy.

Glenn

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10:17 am Friday 19 May 2017
Gang extortion in Northland is not new. It has been going on for over 20 years. Tourists are pre-warned that there is a safety problem up north prior to coming to New Zealand.

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