James Doolan: You can’t be a tourist on Google; why Auckland must reinvest in its visitor economy

Tourism investment in Auckland is below pre-Covid levels, and needs a boost to revitalise its CBD streets.

THE FACTS

• Auckland’s CBD has potential but needs more tourists to avoid major projects becoming white elephants.
• Tourism spending helps restore safety and vibrancy, but investment is below pre-Covid levels.
• Councillors should support restoring public investment in event attraction and destination marketing.

Despite recent commentary on the confronting state of Auckland’s CBD, the city has enormous potential.

With world-class infrastructure such as the City Rail Link and New Zealand International Convention Centre, stunning waterfront views and a vibrant cultural scene, Auckland has almost all the ingredients for success. But as I’ve written before, we need to do more to attract back international and domestic tourists or else these major projects risk becoming white elephants.

Tourism is not just about economic recovery. Visitor spending and the “surveillance effect” help restore safety, vibrancy and pride. With more office workers staying home and CBD apartment sales stalling, tourists are urgently needed to revitalise empty streets and breathe life into shuttered shopfronts.

The post-Covid shift to remote working has permanently altered the role of central business districts. Globally, CBDs are transforming into CEDs (central entertainment districts) where activation is driven by visitors, events, and experiences. You can’t be a tourist on Microsoft Teams or Google. Civic leaders must respond to this paradigm shift.

This isn’t just Auckland’s challenge. Wellington faces similar issues, with its CBD struggling to regain foot traffic. Christchurch, meanwhile, is preparing to open its new stadium. This is a major opportunity to attract events and visitors, but only if supported by co-ordinated destination marketing and event attraction.

Auckland’s investment in tourism and events remains well below pre-Covid levels. Before the pandemic, the city invested over $30 million annually in these areas. Today, we are limping along at a fraction of that. This is not a clever cost-saving strategy – it’s a missed opportunity.

The return on investment for destination marketing is well established. Tourism New Zealand’s “Everyone Must Go” campaign has already delivered measurable results. If publicly funded tourism marketing works, why aren’t we doubling down?

Some argue that the private sector should pick up the slack. But voluntary contributions from hotels and tourism operators are not a sustainable substitute for co-ordinated public investment. International-standard hotels already spend 5-7% of revenue on promotion and an additional 10-12% on commissions, so it’s not like they’re sitting idle!

Others call for new tourism taxes. Overseas, marketing levies are typically industry-led and industry-controlled. These include models such as Los Angeles’ Tourism Improvement District (TID), funded by a levy on all accommodation types.

It’s time to stop treating tourism as a sector that can be taxed without consultation. Former Mayor Phil Goff’s failed Accommodation Provider Targeted Rate (APTR) is a case in point. It damaged trust and triggered costly litigation. Any new tourism funding model must be co-designed with industry and aligned with national strategy.

With local council elections approaching, voters have a chance to shape the future of our cities. Tourism is not just a sector – it’s a solution. Let’s ask candidates what they would do to revitalise our CBD.

We need councillors who understand tourism’s value and promise to support it fully. That means restoring public investment in event attraction and destination marketing to at least pre-Covid levels, and doing it fast!

James Doolan is Strategic Director at Hotel Council Aotearoa and principal of Fantail Advisory.