This is not true, for Russians and Australians I think it is, and lots of backpackers from all over. But for Americans it is very much an aspirational destination on the other side of the world, which is why Marriott resort properties, to pick one example, are usually on the high side of what you'd expect. From Singapore, it's a place to go to for expats and regular Singaporeans alike.
And then there is the huge domestic tourist market. Jakarta-Denpasar is the 10th busiest route in the world, in terms of number of seats on offer.
As an anecdote, a few times I've returned from Bali to SIN on KLM, and the crowd milling around the KLM gate was chalk and cheese to the crowds hanging around the gates for Australian departures. Understandable, the European equivalent of Australian Bali holidaymakers are probably sipping coughtails in the south of Spain, Greece or Turkey (at certain times of the year, anyway).
If you look at the distance from the airport to the northern part of the island - it spans a greater distance than Bondi to Penrith,. It doesn't mean all of Bali is the same (as Kuta).