WHAT IS THE NEXT BIG ITB... · Zealand, 2010; Backpacking and Youth Travel in South Africa, 2007;...
Transcript of WHAT IS THE NEXT BIG ITB... · Zealand, 2010; Backpacking and Youth Travel in South Africa, 2007;...
WHAT IS THE NEXT
BIGTHING IN YOUTH TRAVEL?
Samuel VetrakStudentMarketing, Ltd.
March 8, 2012
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PRESENTATIONOUTLINE
• Market features
• Market overview
• Drivers & trends
• NEXT BIG THING
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MARKETRESEARCHMarket research can reveal answers
crucial for the future growth of any enterprise.
Good marketing decision guided by market research
leads to 25% - 50% increase in revenues within 3 years.*
*Source: D. V. L. Smith, J. H. Fletcher: The Art & Science of Interpreting Market Research Evidence
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Source: UNWTO, 2012; Youth Travel Matters, 2008; UN Population Division, 2011; StudentMarketing, 2011
YOUTHTRAVELMARKETFast facts
Market size: 196 million trips
Market value: US$173 billion
Target group worldwide: 1.8 billion
Average spending per trip: US$1,000 - US$6,000
Average lenght of trip: 10 to 53 days
Number of associations: 300
Number of businesses involved: 40,000
Number of industry events: 150 pa
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Source: UNWTO, 2001 – 2011; Youth Travel Matters, 2008;
YOUTHTRAVELMARKETIndustry value
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Global tourism is a framework
in which youth travel existsYouth traveller of today is
the global tourist of the future
YOUTHTRAVELMARKET Global tourism vs youth travel
Source: Youth Travel Matters, 2008, StudentMarketing, 2012
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Two-way relationship
US$40,000 – US$120,000
Estimated long-life budget
Youth travel currently accounts for 20%
of the global market and is expected to be 25%.
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Source: StudentMarketing, 2012
YOUTHTRAVELMARKET Industry scheme
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Service providers
YAST organisations
Mainstream brands
Governments
Youth travel
Global travelYoung travellers
Programme providers
YAST agencies
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Source: UNWTO, 2005 – 2012; Youth Travel Matters, 2008
YOUTHTRAVELMARKET Industry performance
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Youth Travel – 196million arrivals
0
50
100
150
200
250
2004 2005 2006 2007 2008 2009 2010 2011
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YOUTHTRAVELMARKET Purpose of travel
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Purpose of the last main trip
Explore34%
Relax and fun28%
VFR17%
Study abroad
9%
Work abroad
7%
Volunteer3%
Language course
2%
Source: WYSE Travel Confederation Independent Traveller Survey, 2007
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YOUTHTRAVELMARKETPopulation prospects (15-30 years)
0
0,2
0,4
0,6
0,8
1
1,2
1990 2000 2010 2020 2030
Africa Asia
Europa Latin America and the Caribbean
Northern America Oceania
billion
Source: UN Population Division Prospects, 2011
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PROGRESSIVE
GROWTH
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THENEXTBIGTHINGNext big thing in youth travel?
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2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
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THENEXTBIGTHINGNext big thing in youth travel?
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Source: UNWTO, 2011; Youth Travel Matters, 2008, StudentMarketing, 2012
196 millionarrivals
300 millionarrivals
US$173bn
US$320bn
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MARKETOVERVIEW Educational travel
Competition increases
Source: Institute of International Education, 2011; Global Education Digest, 2011, Language Travel Magazine, 2004 - 2010
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USA – market shared declined
28.6% from 2001 to 2009 (IHE)
UK – market share declined 34.1%
from 2005 to 2009 (LT, student
weeks)
0
1
2
3
4
5
6
2002 2003 2004 2005 2006 2007 2008 2009
Higher Education
English Language Travel
million
Performance
Traditional destinations are losing, new destinations are increasing.
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MARKETOVERVIEWBackpacking/Flashpacking
Top 10 preferred destinations
Source: 2009 Snapshots: Backpacker accomodation in Australia, 2009; Ministry of Economic Development NewZealand, 2010; Backpacking and Youth Travel in South Africa, 2007; Youth Travel Matters (ATEC Symposium), 2009
Share of youth on backpacking
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Australia
USA
France
Spain
Italy
Germany
UK
Thailand
New Zealand
China 79%
76%
70%
New Zealand Australia South Africa
Backpacking and budget travel on rapid increase
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MARKETOVERVIEW Volunteer travel
Evolution of volunteer organisations
Source: Volunteer Tourism: A global analysis, 2008
GoAbroad.com – number of
volunteer programmes offered:
• 2005 – 698 programmes
• 2007 – 3,036 programmes
• 2011 – 6,398 programmes
• 2012 – 6,599 programmes
845% increase over the last 7 years
Case study
Source: Novelli, M., 2005; Coppage, J., 2007;GoAbroad.com, 2011, 2012
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0
50
100
150
200
250
1915 1925 1935 1945 1955 1965 1975 1985 1995 2005
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MARKETOVERVIEWYouth travel accommodation
Hotels vs hostels
Source: Youth Travel Matters, 2008; The STAY WYSE Youth Travel Accommodation Industry, 2008, 2009; The STAYWYSE Youth Travel Accommodation Industry Survey, 2010
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30 29
36
2005 2007 2008 2009
US$
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Average price of a hostel overnight
50% 48%
56% 57%
63%60%
55%58%
2007 2008 2009 2010
Hostels Hotels
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DRIVERSANDTRENDSGrowth contributors
• Emerging markets
• Youth travel agencies
• Mergers & acquisitions
• Governmental engagement
• Diversification
• Less barriers
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Economic impact = shift in the industry?
DRIVERSANDTRENDSEmerging markets
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2002 2012
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Source: Standard Chartered Bank Research, 2010; IATA Industry Outlook, 2010; OECD, 2010
DRIVERSANDTRENDS Emerging markets
Middle class booming in emerging markets
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Emerging countries catching up – international arrivals in global tourism
Advanced; 523
Emerging; 457
150
200
250
300
350
400
450
500
550
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
million
Source: UNWTO World Tourism Barometer, January 2012
DRIVERSANDTRENDS Emerging markets
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DRIVERSANDTRENDS Youth travel agencies
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Source: StudentMarketing, 201226,000 retailers, over 50% bookings, increasing share
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• Young travellers tend to travel for a reason, are not “escapists” and many
programmes include assistance to local communities what underpines
importance of the industry
DRIVERSANDTRENDS Mergers and acquisitions
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• Due to increase in share on global travel, governments and
international organizations have started to recognize the
size and significance of this industry (UNWTO initiatives, EU
- European Year of Volunteering)
• Organisations active on the market are successfully
bringing in partners from different spheres
(Microsoft, ManUtd, TUI)
• Industry is becoming more and more documented
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Youth and student travel brands in TUI portfolio
Source: www.tuitravelplc.com
DRIVERSANDTRENDS Mergers and acquisitions
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TUI Portfolio
297 brands
c. 20 % offering youth & student travel
Youth and studenttravel
Educational travel
StudentCity
Manchester Academy of English
Educators
English Language Centre York
Adventure travel
MasterClass Sports Tours
Interpid Travel
Gecko's Adventures English
Jumpstreet Tours
Volunteer travel
i-to-i volunteering
Real Gap
Inspired Breaks
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Source: www.thepienews.com, 2012; www.timesofmalta.com, 2011; www.travelpress.com, 2009
DRIVERSANDTRENDS Mergers and acquisitions
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Traditional destinations currently dwell in a re-evaluation
phase, reappraising regulations, policies and standards.
Emerging destinations, intensive marketing investments and easing
regulations to gain more market share and international students.
DRIVERSANDTRENDS Governmental engagement
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Source: StudentMarketing, 2012
DRIVERSANDTRENDS Diversification
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Portfolio Destinations
Booking channels Source markets
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Four aspects of the future growth
More youth travellers More stakeholders
More arrivals More revenues
Source: StudentMarketing, 2012
DRIVERSANDTRENDS Diversification
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226
451
639
2004 2007 2010
million
Low-cost carriers fuel grow in YT
Source: iata.org, airneth.nl
DRIVERSANDTRENDSLess barriers
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155
322
802
320
717
937
Europe Asia Transatlantic
Low-cost carriers
Full-service carriers
US$
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Critical mass already speaking lingua franca
Source: British Council, 2006
DRIVERSANDTRENDSLess barriers
9001000 1050
1250
1800 1850
17001600
1400
1250
1990 1995 2000 2005 2010 2011 2015 2020 2025 2030
million Language abilities give current
youth travellers rather different
options and opportunties than
to their parents.
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• 80% online
• 50% word of mouth
• Young first purchasers of overseas services
• Information sharing & vizualisation
• Customer reviews
• Product knowledge
DRIVERSANDTRENDS Less barriers
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Technological leap
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THENEXTBIGTHING Youth Travel
• US$ 100 bn market potential by 2020
• Meaningful sectors (2/3 receipts)
• Education and experience programs
• Both traditional and alternative destinations
• Emerging source markets
• Youth travel agencies
• Online presence
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2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
196 millionarrivals
300 millionarrivals
US$173bn
US$320bn
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