We now know exactly how foreign tourists come for holidays in Hungary

With the connection of catering establishments and tourist attractions to the online data reporting service, the tourism sector will be entirely digitalised by the summer. According to László Könnyid, deputy CEO responsible for tourism at the Hungarian Tourism Agency (HTA), real-time information bolsters fast decision making and also provides a competitive advantage in rebuilding the tourism sector.

The full digitalisation process was launched two years ago, just before the start of the COVID epidemic, with the establishment of the National Tourism Data Supply Centre (NTDSC). The process started with the registration of accommodation providers, and now it is the turn of catering establishments. What information has this provided concerning tourism today?

The big database has essentially been established, we now have current, aggregated data pertaining to the turnover, occupations and reservations of more than 42 thousand accommodation providers, including almost 39.5 thousand small accommodation providers (i.e. in the private and other categories). Because of the comprehensive and real-time data, this digitalisation approach is pure genius: what we should have done is no longer being analysed subsequently, two months later, but traffic can be increased immediately if necessary with the use of targeted, and therefore very efficient marketing campaigns. A spill-over effect due to the digital recording of data, is that the accommodation providers obtain tools and information useful for analysing their own business activities.

The HTA can intervene quickly, but rapid changes of direction may also be needed. Do you have any recent examples?

Yes. A good example was when Austria cancelled its Christmas fairs: we exploited the surplus demand with a Hungarian Advent campaign targeting tourists who were heading there. The idea worked well, both the Basilica and Vörösmarty tér fairs reported high numbers, with many foreign shoppers throughout. 

Where did the most visitors come to Hungary from at the end of the year?

Most visitors came for the Advent fairs, spending a short time in Budapest and occupying the city’s hotels to a relatively high level. The occupancy of some three and four star hotels in Budapest was around 70-80% on New Year’s Eve. 

The pandemic is not yet over, advance booking times have decreased, people are cautious in their plans, and all around the world, travel decisions are being made at the last minute. How far into the future can you see at the moment?

We have advance booking data: that is the point of data-based management. Booking times have got significantly shorter, down to zero-seven days even in the high season. This means that the days are over when we had to launch a campaign in Germany in March to get visitors to come to Hajdúszoboszló, Hévíz or some other spa resort six months later. Today, travel decisions can be influenced quickly in a short time in the digital ether, if we have the data to support then. If we can also see regional disparities, we can launch a more differentiated, targeted campaign. For example, if necessary we can target 35-40 year old Polish families with small children who live in the vicinity of Warsaw-Katowice with offers from Miskolctapolca or Eger. As a result, the utilisation of marketing resources has become exceptionally efficient, which certainly played a role in ending the summer with an all-time record turnover of 15 million guest nights.

Spending on marketing is now concentrated online. What is the current percentage of digital platforms?

The emphasis is definitely shifting in the direction of online, approximately three quarters of marketing expenses are now devoted to digital campaigns.

The previously approved National Tourism Development Strategy has been reviewed and fine-tuned due to the COVID epidemic. Now that the sectoral characteristics have become clear, how has this altered the picture?

The most important goal at the moment is relaunching: to regain the 2019 figures, which also happened to be a record year with 43 million guest nights and even signs of overtourism in certain locations. The genius of the NTDSC is that it is also able to manage regional differences, which is becoming increasingly important and useful. Let’s consider a future example. What happens if a “No vacancies” sign has just been hung up on a Balaton beach or a country spa, but new guests heading there are unaware of this fact? A message is sent by way of a mobile app that includes an offer for a nearby beach or spa that can accommodate more visitors because it has not yet reached full capacity. The goal is to enable this using both big data and artificial intelligence.

Apropos attractions. When will we have real-time data on baths?

By the summer, catering establishments and tourist attractions will also have joined the system. By the end of the year, we expect to have exact, real-time data suitable for analysis on museums, castles, baths and festivals that issue entry tickets, as well as restaurant turnover. We won’t know how many Wienerschnitzels have been ordered in a given restaurant, but we will know food consumption figures and the revenue from the sale of alcoholic and non-alcoholic drinks consumed on site: so basically, everything the National Tax and Customs Administration sees. The analysis of turnover and forecasting using algorithms is also an enormous help in human resources management. As soon as we have data on all three slices of the tourism pie (accommodation providers, catering and attractions) we will have taken the historic step of digital transition, which will truly be a milestone in the history of the profession.

Has the large quantity of data caused any surprises, or have you received any information that you were not familiar with?

It would be better to say that previously we would assume certain things, but now we know them. For example, the NTDSC data have made it clear that Western Hungary is most frequented by Austrians living near the border. The Viennese tend to visit Sárvár, Zalakaros or Bük, but our feeder market is not really the whole of Austria.

Besides the NTDSC, what other databases does the HTA use?

We have purchased mobile cell location data, the aggregated anonymous data that show where and when mobile phones are located, so we know how much time tourists spend at various locations. For example, this has shown us that Buda Castle is a thirty-minute attraction, and that at certain times the Parliament building and the Dohány utca synagogue are the most visited locations in Budapest. We also know, as now backed up by data, that the majority of foreign tourists move around Pest city centre, without even leaving it. We have also discovered that Polish tourists are very mobile, even travelling all round the country, but Czech tourists favour wellness spots and generally do not leave their hotels after checking in. We plan to use Czech language advertisements to encourage them to visit local attractions and check out what is on in the area.

Is it possible to deduce what 2022 will be like? What are your expectations?

Bookings for 1.7 million guest nights had already been made by the end of the year, 850 thousand of which were made for January. Foreign tourists are starting to return, and we expect to reach 43 million guest nights from other markets, even without tourists from Asia. The progress of rebuilding is promising, as we neared 30 million guest nights in 2021. Not everything will return to what it was, for example the Far East is taking longer to bounce back and we do not expect guests from Asia before the summer: this market is still lacking in Budapest. But the Danube floatels with American guests will open in April. Meanwhile, the Visegrad countries have gained strength and value, as we have managed to reach people in nearby locations within driving distance. 

Will the pandemic have a long-term effect on clientele?

Yes, we expect travel habits to change permanently. We visit nearby locations more frequently, which tendency we expect to persist, but that can be exploited. That is why the fact that the NTDSC is now complete is so advantageous. What’s more, we are the only ones with this type of solution, which provides a huge competitive advantage due to fast and exact decisions.

What will we have to do differently?

A number of important points have been added to the long-term strategy, for example, catering has become very important, which is in line with the expansion of the NTDSC. Health tourism is another important element which also targets the basis for the development of baths as supported by the EU in the period 2021-27, as baths are a primary product in the countryside, which may prove to be competitive even on an international level. Religious tourism also has enormous reserves. These are what we will be focusing on in the future. Meanwhile, we have also set the boundaries for tourism areas, which places international marketing on a new foundation.

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