As plans to reopen the Indonesian island of Bali to foreign visitors have been delayed until 2021, domestic travellers are now in the spotlight.
Tourism industry members see the delay as realistic and are now optimising the potential of the domestic market, reported the chair of the Indonesian Hotel and Restaurant Association (PHRI) Badung chapter, I Gusti Agung Ngurah Rai Suryawijaya.
If high-end Indonesian travellers aren’t able to [travel abroad], then by necessity they will go to Bali. It’s a very solid market which is enormous.
Since restarting domestic tourism at the end of July, Bali has seen an increase of more than 100% in domestic arrivals. At the recent launch of the island’s famous Kecak dance with ‘new normal’ protocols, Bali governor, I Wayan Koster, said “there are already signs of improvement, or restoration, of our tourism industry.”
The governor reported that Ngurah Rai Airport is now receiving up to 35 flights per day, and that over the recent Independence Day and Islamic New Year holiday period, up to 5,000 passengers arrived daily. These figures do not include those entering via land routes, which have also increased, he noted.
Matt Gebbie, Pacific Asia (Indonesia) director of Horwath HTL, has said that Bali’s massive demand base in Jakarta, Surabaya, Makassar and Medan comes at every price point. “If high-end Indonesian travellers aren’t able to [travel abroad], then by necessity they will go to Bali. It’s a very solid market which is enormous.”
While Bali is Indonesian's most established destination for foreign tourists, the island actually received 10.7 million domestic arrivals in 2019, significantly more than the recorded 6.3 million international arrivals. Nationwide, there were 300 million domestic tourist trips made last year, compared to 16.1 million foreign trips.
Total revenue generated by domestic arrivals in Bali last year almost matched the US$8 billion contributed by international tourism, governor Koster has stated. Furthermore, 55 per cent of total national tourism receipts in 2019 came from the domestic market, according to the coordinating minister of maritime affairs and investment, Luhut Binsar Pandjaitan.
To entice Indonesians from various regions, national carrier Garuda, PHRI-Bali, and several other tourism associations are formulating flight and hotel bundles, Bali Tribune reported. Garuda will also add new domestic routes, such as Bandung to Bali.
Meanwhile, Bali Hotels Association’s (BHA) government relations director, Fransiska Handoko, says hotels have been pivoting towards the local market through various campaigns that prioritise flexible booking conditions and hassle-free cancellations. “The domestic leisure market generally prefers a free and easy stay and to not be bound by tour packages,” she explained.
Handoko also emphasised that while some hotel brands and tourist areas are quite popular among the domestic market, others are not. “We need to monitor demand and consider the pricing strategy, as [current strategies are certain to] lead to a price war.”
However, BHA believes that domestic demand will not be strong enough to support all hotels in Bali to a profitable level, she said. “But of course domestic tourists will contribute to Bali’s economy. They still eat, shop and engage in activities that support local businesses.”