Late last year, Lion Travel, a travel agency under the Lion International group specializing in inbound and domestic tourism, received a letter from the British Railway Enthusiasts Association. The letter expressed the members’ wish to see a steam locomotive in action on the railroad tracks of Taiwan.

In order to demonstrate the steam engine locomotives dashing through Taiwan’s mountain forests, the rapid rotation of the train’s wheels, the white smoke billowing from the smokestack, and the sonorous sound of the whistle, Lion Travel identified Neiwan, Jiji, and Pingxi as three suitable locations for the visitors to experience. (Read: Summer Formosa Steam Locomotive Trips)

The Taiwan Railway Administration responded, however, that train traffic would be heavy during the times specified, and so running the steam engine train would be impossible. However, a week later the British Railway Enthusiasts Association wrote back to Lion Travel, saying “We looked into the Taiwan Railway Administration’s schedule, and there are quite a few open time slots.”

So it happened that the British Railway Enthusiasts Association flew to Taiwan to see steam locomotives in action. And not only did they take photos and record videos, but, with the help of railway administration officials, they also got into the driver’s compartment to drive the train for a stretch.

Thematic, customized immersion tours like this are set to become the new mainstream for foreign tourists in Taiwan.

Tourism Trends: Customization, A La Carte

According to data from the Taiwan Tourism Bureau, the proportion of tourists traveling in Taiwan on independent itineraries exceeded 80 percent in 2017.

This travel trend is gathering momentum not just in Taiwan, but all over the world.

Looking over predictions for upcoming trends among tourism-related businesses, agencies and websites over the past two years, nearly all of the content is related to people’s yearning for individualized travel and immersion in local culture.

Derek, who hails from New Jersey in the United States, came to Taiwan for work four and a half years ago. This is the first time that he has joined the Dajia Mazu pilgrimage. (Read: The Mazu Pilgrimage Experience)

“Travel has always been very individualistic; it’s just that, 20 years ago, customized travel was prohibitively expensive, and since few could afford it, they ended up joining an organized tour,” says Ming Chen, founder and CEO of KKday, himself a veteran of 20 years in the online tourism industry.

No one thought about things like dining at the same table with strangers, or falling in love with beautiful scenery yet having to get back on the bus at the time specified by the guide to head to the next stop.

That is, until the Internet age, which has seen the rise of budget airlines and the proliferation of accommodation booking sites, boosted by mobile phones and affordable data rates, effectively splitting tourism up into air tickets, accommodations, and tour itineraries, liberating people to travel on their own.

Chen observes that social media has become a platform for sharing and interaction.

For social media users looking to show how cool or exciting their lives are, rigid, formulaic itineraries have lost their appeal, and consumers are seeking to arrange more immersive experiences for themselves.

Lion Travel president Huang Hsin-chuan, who began working in the tourism industry in 1983, has deep feelings about these developments. (Read: How Much do the Taiwanese Love to Travel? The Wandering Youths of a Bygone Era)

“In the past, tourism industry training was aimed at putting together scattered components in an orderly arrangement to package into itineraries for sale to consumers. However, over the last seven or eight years, it has gone the opposite direction, breaking up package tours,” notes Huang. Compared with the group tour style of just taking in the sights, most people these days prefer “parts” assembled into a product.

Departing from the past practice of ordering set meals, more and more tourists favor an “a la carte” style approach, which allows further customization.

The Internet has turned the international travel model upside-down. As tourists arrive at destinations around Taiwan, they are not only helping boost industries directly connected to tourism, but also such peripheral sectors as the culture and creative industry and gifts and keepsakes, boosting the local economy and providing the best opportunity for Taiwan to achieve a society with more equitable wealth distribution.

Opportunities: All Industries Get Rich

Liu Hsi-lin, assistant provost of National Kaohsiung University of Hospitality and Tourism, relates that, compared to the high-tech industry, which measures production value in the trillions, the output of Taiwan’s tourism industry accounts for less than five percent of GDP. This is far lower than the global average of 10 percent, yet the benefits most easily penetrate across various industries.

The reason is that each industry can use tourism as a “vehicle” to increase its production value.

Liu cautions against businesses dropping their existing industry to rush headlong into tourism. For instance, Yunlin’s key industry is agriculture. Liu stresses that Yunlin should maintain development rooted in the area, while sprouting tourism products or tours from within to naturally attract tourists Yunlin’s way.

“If equitable wealth distribution means that every field and line of work can make money, and everyone is happy, then tourism is the only industry that can pull it off,” Liu says.

The return visit rate for independent travelers in 2017 was 25 percent. That means that one out of every four foreign independent travelers in Taiwan will visit again. (Photo by Chien-Ying Chiu/CW)

Taiwan has always had the resources and conditions for developing custom independent tours. (Read: American Travel Writer Cheryl Robbins Takes Visitors on Tailor-Made Tours to Taiwan’s Indigenous Communities)

Looking at geographic position, Taiwan is located at the airline hub for Northeast and Southeast Asia, covering one-third of the world’s population within the reach of a four-hour plane ride. And these also happen to be regions in which tourism is staging the fastest growth. (Read: Hong Kong-Taipei, World’s Busiest Airline Route 3 Years In A Row)

In spite of its small area, Taiwan has a wealth of natural scenery and cultural color.

Taiwan has mountains, the sea, and hot springs. And, remarkably for such a small island, it has 269 mountains that rise 3,000 meters above sea level or higher. From high peaks to the deep sea, Taiwan has a rich variety of natural gifts. (Read: Taiwan’s Strategic Ocean Advantage as an Island)

In addition to indigenous and Han Chinese culture, Taiwan bears the deep influence of Portuguese, Dutch, and Japanese culture. The influx of people from the war-torn Chinese mainland who settled here brought with them a rich array of Chinese culture.

In contrast to countries with vast territory, Taiwan boasts a fairly even distribution of transportation options and conveniences, and a people whose friendliness matches the beauty and gifts of the natural environment, along with one of the world’s highest safety indexes.

“Taiwan has what it takes so that tourists who visit once want to come back on their own the next time,” says Liu Hsi-lin. The return rate of independent tourists in 2017 was 25 percent. In other words, one out of every four visitors to Taiwan comes back.

Just as Taiwan’s tourism industry exhibited a healthy constitution like never before, however, tourism profits took a heavy hit.

Problem: More People Doesn’t Mean More Money

Analyzing the situation further, Taiwan saw 11.06 million inbound tourists in 2018, the third consecutive year that the number surpassed 10 million. However, foreign exchange revenue from tourism fell from NT$458.9 billion to NT$374.9 billion, which also marked a decline for the third consecutive year.

With more people coming in but revenue not increasing, the Taiwanese tourism industry would appear to be hemorrhaging.

But there is more to the story. Over the last eight years, more Taiwanese have traveled abroad than tourists have visited Taiwan. In 2018, this “deficit” was 5.57 million individual trips, amounting to a foreign exchange deficit of NT$172.8 billion.

“Trade deficits must be addressed, so should the government actively take on this sort of gap between income and outflow in the tourism industry?” asks Chen Kuo-chun, former director of the New Taipei Tourism and Travel Department.

Four years ago, a retired lawyer from Belgium named Dr. Moons wrote a letter to MyTaiwanTour, a company specializing in designing customized tours for foreign tourists, looking to arrange a 21-day immersive tour of Taiwan for him and his wife. Following communications between MyTaiwanTour customer service personnel, the couple ultimately decided not to pull the trigger.

The reason they gave for not going ahead with the tour was that Taiwan’s tourism selling points were not made clear enough.

He had taken in China’s great rivers and seas, and millennia of culture and history; in Hong Kong he had felt the prosperity and international character of the city; in Thailand he had experienced the brilliance and beauty of everyday people and culture. After all of this, the sites and experiences suggested by MyTaiwanTour seemed anticlimactic to him, and did not spark further interest for him.

What sort of impasse has Taiwanese tourism reached? As tourism focuses more on experiencing local life, along with the trend toward autonomous touring, what can Taiwan do to seize the opportunities at hand?

Taiwan is especially lacking a long-term, specific tourism policy.

Recent years have seen excessive reliance on government funding. To wit, we have witnessed theatrics over national tourism grants six times in just the last two years, and even the New Southbound Policy is more of the same.

There is so much available in stipends, yet the economic power of the 18 countries targeted by the policy cannot measure up to that of Japan, Korea, and China. So this only proves that funding does not necessarily amount to saving Taiwanese tourism, and that short-term relief cannot foster competitiveness in the tourism realm.

The key is how to raise the level of government authority.

Solution 1: Raise The Level of Government Agencies in Charge

“Tourism” encompasses broad territory, and the secondary-level Tourism Bureau ranks too low to be effective. Only be raising the level of the government agency in charge can inter-agency resources be properly consolidated.

For example, the Tourism Bureau has designated 2020 as “The Year of Mountain Travel,” intending to utilize Taiwan’s most stunning mountain tourism card to attract international visitors.

However, aspects from mountain permits to mountain lodge management and mountain rescue operations are scattered across at least six different government agencies, including the Ministry of the Interior, Council of Agriculture, and National Fire Agency. Before the mountains are opened up next year, it is imperative that these agencies and their roles be consolidated.

National leaders should also learn from Japan, which gives full backing to the tourism industry at the strategic level of national development. In 2013, a total of 10.36 million tourists visited Japan, around two million more than the 8.01 million that visited Taiwan. Five years later, Japan recorded 31.19 million individual visits, or more than 20 million more than Taiwan. Beyond Japan’s robust tourism resources and conditions, Prime Minister Shinzo Abe’s advocacy of the tourism industry is certainly a key factor.

Solution 2: Elevate Products and Services

As Taiwanese tourism has passed the “introductory stage” and entered the “immersion tourism” stage, it would be unwise to measure it merely by the volume of visitors Taiwan receives, as opposed to evaluating satisfaction with tourism quality along with the industry’s production value.

Only quality can drive return visit rates, and make it possible for more tourists to come to Taiwan as consumers.

Customer satisfaction with tourism quality has everything to do with facilities and services. Instead of directing its share of airport taxes of more than NT$10 billion on funding for tourism, the Taiwan Tourism Bureau should use the funds to fix up such public places as night markets and other markets, as well as the overall sprucing up of scenic areas.

“In terms of friendliness, Taiwan’s tourism environment does not make the grade when it comes to serving international tourists,” observes Huang Hsin-chuan. Other than foreign language ability, clean and tasty restaurants that can attract Japanese tourists to come in and patronize are essential, as well as clean bathrooms and an overall improved environment.

Photo by Kuo-Tai Liu/CW

Solution 3: Relax Legal Restrictions

Given the impact of the trends toward globalization, digitalization, and localization, Taiwanese tourism finds itself taking stock of the structure of visitors and types of tourism consumption. Meanwhile, regulatory restrictions should be relaxed in a timely manner.

The government has expended considerable effort in recent years to promote agricultural and indigenous tourism, as well as local business, encouraging startups or youths returning home to develop small local tours.

However, restricted by the Statutes of the Development of Tourism Act, domestic tourism involving dining, accommodations and transportation arrangements must be run by Class A and B travel agencies with capital of at least NT$3 million. This leaves returned youths no option but to skirt the law in the name of “gaining experience.”

At one point last year, the Tourism Bureau thought about allowing private organizations to join Class C travel agencies, only to cause intense backlash from travel agencies. Then, this past March, the Tourism Bureau announced that it was planning to lower the capitalization requirement for Class B travel agencies from NT$3 million to 1.5 million, only to encounter more protests.

“Where is a tea farmer or aborigine going to put up NT$1.5 million to start a travel agency?” asks MyTaiwanTour founder founder and CEO Michael Wu, whose company frequently cooperates with local organizations.

Since emerging travel ventures can enliven local economies, regulations should be loosened under accompanying measures intended to reduce risks and safeguard consumers’ rights and privileges, or be omitted from the provisions, while also planning out industries that embody and highlight local color, legally operated by returned youths.

Although independent tours have become the trend, other than planning itineraries, tourists also need travel agencies to help tie together smaller local operators for a taste of local living. Accordingly, conventional travel agencies should give thought to how to go about transitioning and developing localized itineraries.

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Solution 4: Shift Focus to Immersive Travel

Travel agencies should go beyond just taking tourists on whirlwind tours, sampling local dishes, and trying DIY crafts, and forge additional opportunities to make more local connections. Huang Hsin-chuan, who got on board quite early with in-depth domestic tourism, believes that the core value of in-depth travel is “local,” in which “people” are the most important factor. Therefore, tourists must be able to sample local living.

Travel these days has departed from the old habit of choosing set packages, increasingly leaning toward a la carte options. Travel is no longer just about following the same formulaic set itineraries. (Photo by Chien-Ying Chiu/CW)

For instance, a group buying Chinese New Year’s provisions might be led by a Hakka guide from Zhudong, who takes them to a little unknown market to buy local ingredients. Or they might tag along with a licensed buyer to the Taitung Chengkung Fish Market, where they can feel the excitement of the auction, after which the fish is prepared and served to the tourists.

Interestingly, less than one percent of Taiwan’s approximately 3,000 travel agencies are equipped to lead in-depth immersive tours. “A lot of people don’t think it’s their market, but if they can get close to the changes afoot with tourists, there are still opportunities,” observes Huang Hsin-chuan.

“I can get a client for US$100 a head, which beats my dad with a whole bus full of mainland Chinese tourists,” says Michael Wu, a second-generation tour operator. Conventional tour operators are still not very familiar with new modes of tourism consumption. Operating customized tours, Wu never promises commissions, rather leveraging service to raise value and help locals make more money.

Tourism is really a projection of local life and culture. Countless festivities such as the Matsu temple procession, harvest festivals, sky lanterns, and earth ovens are rooted in the culture and way of life of people that lived on the land before us. Youths and private organizations are moved to action in order to keep local industries alive and pass on culture and history.

Apart from paying attention to and taking these old things seriously, transforming them into cultural attractions for tourists to experience, or creating high added-value products like “dining tables by the rice fields,” it is even more important to “internationalize” local color.

Even the best attraction will fail to resonate with foreign tourists without a good story to bring out its richness. Michael Wu believes that itineraries should be planned and packaged from foreigners’ perspectives, ideally in direct consultation with foreigners, with local guides playing the role of “cultural storytellers” on site.

Most of the tourists Wu serves are “just passing through” Taiwan while touring other countries, or have exhausted their options after already visiting 60 or 70 other countries. However, after experiencing Taiwan, these Western tourists invariably tell him that Taiwan is “a hidden treasure in Asia.”

This is the best feedback the tourism industry can get, and it is the responsibility of every Taiwanese to help ensure that the whole world stands up and notices this hidden treasure in Asia.

Translated by David Toman

Edited by TC Lin, Sharon Tseng