First predictive Tourism Index launched for Hong Kong

August 4, 2023

Education / Tourism /

Hong Kong University of Science and Technology has today launched the Wisers-HKUST Tourism Index to support Hong Kong's tourism growth following the resumption of normal travel between Hong Kong and the Mainland.

The University’s School of Business and Management launched the Tourism Index in collaboration with Wisers Information Limited with the Tourism Index offering forecasts of key tourism metrics based on a predictive model of Mainlanders' intentions in travelling to Hong Kong.

The model was constructed using leading-edge AI technologies, such as natural language processing and machine learning, to analyse over 10 million data points¹ from social media platforms, online travel agencies, and travel forums in Mainland China.

Adjunct Associate Professor of HKUST Business School and Advisor of CBSA Dr. HE Chao notes "Tourism is one of the four pillar industries in Hong Kong. To help the industry better respond to the fast-changing environment, we have constructed a series of predictive tourism indices. The Wisers-HKUST Tourism Index leverages big data text analytics for the first time to forecast Hong Kong tourism activity levels, overcoming the limitations of traditional surveys' limited insights and the delays in industry statistics."

The tourism industry faces a challenge in business planning, as key tourism statistics are available with a lag time. For instance, data for January is only accessible in March. To help address this issue, the Tourism Index provides forecasted values for crucial tourism metrics such as the overall tourism sector outlook, mainland visitors' arrivals, hotel occupancy, and hotel average daily rate. This forward-looking indicator offers a glimpse of the near-term sector outlook, and its forecast values for the current month and the next two months² are publicly accessible.

To produce its forecasts, updated on the 10th each month, the Index makes reference to historical tourism statistics and over 20 travel-related influencing factors, including travel desire and sentiments captured from analysing social/online media postings.

Senior Associate Dean of HKUST Business School and Director of CBSA Professor HUI Kai-Lung adds "Accounting for nearly 80% of visitor arrivals to Hong Kong, mainland visitors hold key to the revival of Hong Kong's pandemic-hit travel sector. Working at the confluence of business and technology, our research team has put together a set of forward-looking indices showing near-term trends of key tourism metrics to support government agencies and the industry in devising pre-emptive tourism policies.

“Through this project with practical applications for the tourism sector, we also hope to demonstrate the potential of the fast-growing field of data analytics, and promote the wider use of big data technologies in the business community and beyond."

Wisers Chief Executive and Advisor of CBSA Denise CHE explained "Powered by Wisers' extensive Chinese media database and automatic data processing platform, the predictive model underlying the Tourism Index analyses massive volumes of text data collected by WisersOne from digital platforms frequently used by Chinese travellers, providing a systematic understanding of factors impacting Hong Kong's tourism arrivals."

Commenting on the Tourism Index, Hong Kong Hotels Association (HKHA) Chairman, Peter WONG Chak-fung shared "Marking a significant milestone for the tourism industry, this initiative underscores HKUST's and Wisers' dedication to innovation and the utilisation of big data to generate crucial tourism indicators for economic and tourism recovery. HKHA understands the importance of accurate and insightful tourism indicators that can aid hotel operators in making informed decisions. We eagerly anticipate working together with two organisations to contribute to the sustainable growth and development of Hong Kong's hotel sector as well as smart city transformation."

Wisers-HKUST Tourism Index comprises the Composite Index, and its three component indices, namely Visitor Arrivals Index, Hotel Occupancy Index, and Hotel Average Daily Rate Index, which are the weighted average of the Composite Index, with weights of 50%, 25%, and 25% respectively. The Index is available for viewing on the CBSA website at tourismindex.hkust.edu.hk/

References

1. A data point refers to a post made on social media, online travel agencies, and travel forums

2. The Tourism Index's forecasts for the period from Jan 2018 and Mar 2023 had an error rate as low as 4%, according to a study by a research team of CBSA and Wisers AI

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