How changes in tourism will affect medical travel

 

International tourist figures

The first six months of 2010 saw international tourist arrivals grow by 7% according to the World Tourism Organisation’s UNWTO World Tourism Barometer. This result confirms the recovery trend beginning in the last quarter of 2009 and is expected to continue.

Asia and the Pacific (+14%) and the Middle East (+20%), continue to lead growth in the first half of 2010 with the majority of destinations in both regions posting double-digit growth rates. Asia in particular is experiencing a very dynamic rebound, with strong results from Sri Lanka (+49%), Japan (+36%), Vietnam (+35%), Myanmar (+35%), Hong Kong (China) (+23%), Macao (China) (+23%), Singapore (+23%), Fiji (+22%) and the Maldives (+21%). Thailand (+14%) posted encouraging results in spite of the political unrest early this year. In the Americas (+7%), Central and South America show steady growth, as does North America. Growth has been slower in the Caribbean but results are still improved compared to 2008 and 2009. Europe (+2%) shows the slowest recovery but results from recent months are more positive.

International tourism receipts are affected as travellers travel closer to home, for shorter periods of time and seek value for money, while on the supply side increased competition has been driving prices down.

Overall, international tourist arrivals totalled 421 million during the first six months of 2010, up 7% on 2009, but still 2% below that of the record year of 2008 (428 million arrivals). These results follow one of the toughest years for the tourism sector with international tourist arrivals declining by 4.2% in 2009 to 880 million and international tourism receipts falling in real terms of 5.7%.

High unemployment continues to be a major cause of concern and the austerity measures as well as the rise in taxation implemented in several advanced economies to fight public deficits represent a clear challenge to many leading outbound markets. Taleb Rifai of UNWTO says. “In the USA and some major European markets, economic recovery has still to consolidate. ” A large majority of international travel takes place within the traveller’s own region, with around four out of five arrivals worldwide originating from the same region. The remarkable rebound of Asia is to a large extent a reflection of the strength of the regional outbound markets. Domestic tourism is of equal importance. Worldwide the number of domestic arrivals is estimated to exceed some four times the number of international arrivals.

Destinations

The top ten international tourism countries are; France, USA, Spain, China, Italy, UK, Turkey, Germany, Malaysia and Mexico. Most have been in the top ten for a few years, but Turkey is a newcomer. Europe accounts for half of all international trips, and four out of five of these are within Europe.

Domestic tourism

UNWTO has also looked at domestic tourism. Márcio Favilla of UNWTO comments,” With consumers tending to travel closer to home in times of downturns, domestic tourism has been experiencing significant growth. Coupled with regional tourism, domestic tourism can serve as an important driver of development and growth, in particular during times of economic uncertainty.”

Medical tourism figures

In 2008 and early 2009 countries fell over each other in a rush to tell us how fast their medical tourism numbers were growing. From late 2009 and onwards, most fell silent, perhaps not wanting to admit how badly numbers had fallen, and how far off predicted targets current numbers were. Even the handful now issuing figures are often at great pains to give encouraging news for 2010, while referring back to 2007 or earlier for comparisons. It is as though 2008 and 2009 figures have been wiped from the collective memory. Some current figures are based on solid research; and although not perfect, the way the UK counts medical tourism separately from spa and wellness tourism, and as one of a dozen niche categories in inbound tourism, gives a good benchmark. The interesting thing about the UK figures is that they are complied by independent researchers who are not promoting tourism. For most country’s figures we have to rely on government or other bodies that are specifically promoting tourism and medical tourism, so have a vested interest in painting the best picture possible. The worst recent case of this is the claims of  the UAE where the claimed medical tourism figures are so exaggerated as to be pure fantasy.

Medical tourism likes to think it is not tourism, but it needs to work with national and international tourist bodies who produce reliable figures. Then we might get a real view on numbers globally and by country. Real statistics may show up the data from some highly promoted destinations as works of fiction. I suspect that if we had more real European country figures, several countries now claiming to be top destinations, would be shown to be way down the number list.

UNWTO figures only count visits with one or more night’s accommodation. So they exclude day visits. This means that domestic tourism numbers are understated. It also means that medical tourism trips with no overnight stay, e.g. across the Mexican border or from the UK to Poland, may not be counted.

Consumers

According to consumer trend analysts trendwatching.com, travel customers look for instant gratification. If something online is too slow or too cumbersome or too boring, then an alternative site is only a second away. 57% of US customers will wait three seconds or less before abandoning a website.  The post-recession consumer has changed. Customers are not willing to pay full price for anything and are prepared to spend time seeking the best deal. This does not mean they look just for the lowest price, as they are looking to save money without sacrificing quality. It has become the norm to look at customer comments on websites and social media, before booking.

Competition

On all types of travel and tourism, and all sectors from hotels to airlines, suppliers have had to cut prices and improve the quality of their product to get business. Medical tourism providers have to compete with each other and with domestic providers.

What this means for medical tourism

  •     Figures

The industry should be working to get medical tourism counted as a niche tourism sector. To do this it needs to decide whether medical tourism and health tourism are the same or different animals. It is convenient for some countries to include them both in medical tourism figures as it boosts figures, but others use a strict definition of medical tourism. No other tourism niche seeks to go it alone on country-by-country figures; so why do we ignore existing figure collectors who have been doing it for years?

  •     Competition

There are now many more competitor countries, hospitals and agencies than five years ago. Trading on low prices only, or expecting customers to pay a premium to come to you are now both defunct strategies. People want high quality but a good price too. Medical tourism has to first persuade people to travel, and only then persuade them where to go; hospitals just promoting their brand totally misunderstand how sales and marketing work.

  •     Websites

These have to be slick, interesting and inter-active. Fewer potential customers will bother to phone or email for details of costs, they want instant information or will go elsewhere. It is vital to offer real customer reviews, to monitor what is said about you on social networking sites, and to give a genuine response to complaints. Attacking people who say ‘bad’ things is totally counter-productive (Indian government please note!)

  •     Targeting

Some people will still travel long-distances for treatment. But the vast majority will only travel within their region, or even only within their own country. Agencies, countries and hospitals have to decide their target market/s; blanket global promotion is wasteful. Almost all governments are struggling on healthcare costs. More responsibility is being put on to individuals to look after their own health. So targeting governments or other official bodies in the hope they will spend money they no longer have to send people to your country, is almost always going to be a waste of time and effort. 

Conclusions

The recovery in tourism numbers offers great hopes for medical tourism. But growth will be slow, and annual increases much smaller than before. The industry is settling down as a developing niche sector. Increasing competition and changes in customer wants and behaviour mean that only the most professional hospitals, agencies and clinics will prosper. The days of sitting back and expecting customers to rush at you are gone forever. All business will be hard won, and many in the business will be found wanting and fall by the wayside.

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