Why Everything You Know About the Future of Tourism is Wrong

R E S O N A N C E C O . C O M @ C R F A I R
WHY EVERYTHING
YOU KNOW ABOUT
THE FUTURE IS
WRONG!
RESONANCE

ABOUT US
Resonance Consultancy is a global
advisor on destination development,
marketing and management for many
of the world’s most loved places.
@ C R F A I R

ABOUT US
Tourism Economics exists to assess the
interplay between the economy and
travel, both historically and in the
future.
• Impact studies
• Policy analysis
• Global travel data and forecasts
@ C R F A I R

AGENDA
• Global Tourism Forecast
• Potential Disruptions
• Planning for the Future: Scenario Planning
• Case Study: Tourism Vancouver 2030
@ C R F A I R

TOURISM IS ONE OF
THE WORLD’S FASTEST
GROWING INDUSTRIES

HOSPITALITY HAS LED JOB GROWTH IN 95 OF THE TOP
100 US CITIES
-1%
0%
1%
2%
3%
4%
5%
-1% 0% 1% 2% 3% 4% 5%
Employment Growth, 2007-2017 (CAGR)
Leisure & Hospitality
Total Employment

2022-30 CAGR2017-22 CAGR2007-17 CAGR
0%
1%
2%
3%
4%
5%
6%
7%
8%
Travel spending
GDP
Source: Tourism Economics
Growth of outboundtravel spending and GDP, nominal US$International travel
spending has
consistently
outpaced overall
economic growth by
nearly a full
percentage point.

@ResonanceCo
KEY DRIVERS
Three drivers of international travel growth – and their expected evolution – help us
define the sustainability of this extraordinary growth in international travel.
1. Travelling Class: The base number of potential international travelers with
sufficient income to travel is expanding rapidly. Growth of the traveling class is set
to continue, especially in emerging markets.
2. Demographics: Bookend grounds of Seniors and Millennials are driving a new
wave of growth.
3. Connectivity: Physical and technological.

R E S O N A N C E C O . C O M @ C R F A I RR E S O N A N C E C O . C O M @ C R F A I R
Driver #1: The base of international
travelers is expanding rapidly

Long-haul travel will
become affordable
for more than 244
million additional
households between
2014 and 2024.
324
366
394
40
143
272
88
145
232
0
50
100
150
200
250
300
350
400
450
2004 2014 2024
Thousands
Developed BRICS Other Emerging
Households with income over $20,000 per annum, millions
Source: Oxford Economics
Traveling Class Household Volumes

Driver #2: The world’s
population is aging across every
region of the world

By 2024, seniors will
represent more than
10% of all international
travel. This is up from
7% in 2014 and 6% in
2004.
0
40
80
120
160
200
0%
2%
4%
6%
8%
10%
12%
2004 2008 2012 2016 2020 2024
Senior travel share (L)
Senior travel volume (R)
Senior travel growth 2004-2024
Percentage
Source: Tourism Economics, IPK
Million Trips

Senior travel growth
will outpace overall
international travel
growth over the
coming decade, with
emerging markets
leading in growth
terms and developed
markets leading in
absolute volumes.
.
0% 50% 100% 150% 200% 250%
South Korea
Russia
India
China
Brazil
United States
United Kingdom
Japan
Germany
Canada
PercentSource: Tourism Economics
Percent increase in senior travel, 2014-2024
Source: Tourism Economics
Developed
average = 95%
Emerging
average = 198%

Driver #3: Travelers are more
connected to destinations
than ever before

WORLD AIR PASSENGERS
Source: U.S. Department of State Data

Massive airport
development projects
are underway or planned
around the world. This
includes more than
2,500 separate airport
construction projects
including 340 entirely
new airports.
0
100
200
300
400
500
600
700
800
900
APAC Africa Europe Middle East Lat Am North Am
Projects - new Projects - existing
Planned new and existing airport improvement
projects by region
No. of projects
Source: Tourism Economics analysis of CAPA data. Base = 2,520 (340 + 2,180)

R E S O N A N C E C O . C O M @ C R F A I RR E S O N A N C E C O . C O M @ C R F A I RR E S O N A N C E C O . C O M
POTENTIAL DISRUPTIONS TO
THE FUTURE WE EXPECT
@ C R F A I R

ENVIRONMENTAL
@ C R F A I R

0
35
70
105
140
175
0
2
3
5
6
2008
2009
2010
2011
2012
2013
2014
AnnualAveragePM2.5levels(µg/m3)
AnnualInboundVisitors(millions)
BEIJING ANNUAL INBOUND VISITORS BEIJING ANNUAL AVERAGE PM 2.5 CHINA PM 2.5 STANDARD U.S. PM 2.5 STANDARD
BEIJING ANNUAL VISITORS
Source: U.S. Department of State Data

TERRORISM
@ C R F A I R

-6.2%
17.8%
12.8%
2.8%
5.7%
9.9%
1.0%
9.8%
5.5%
-1.6%
-30.1%
10,000,000
17,000,000
24,000,000
31,000,000
38,000,000
45,000,000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Foreign Arrivals Foreign Arrivals Change
ISTANBUL FOREIGN ARRIVALS
1st Terrorist Attack
Source: Kultur

PEAK
GLOBALIZATION
@ C R F A I R

UK ARRIVALS
Source: Visit Britain

TOO MANY TOURISTS

CITY TRIPS SOARED 98%
BETWEEN 2011 AND 2016 TO
REACH 25% OF ALL LEISURE
HOLIDAYS
R E S O N A N C E C O . C O M
Source: World Travel Monitor
@ C R F A I R

WHY CITIES?
@ C R F A I R

TYPES OF FUTURE VACATIONS FOR U.S. MILLENNIALS
47%
42%
41%
40%
27%
26%
23%
19%
19%
6%
Visit to a beach resort
Visit to a major metropolitan city
Family vacation with kids
Vacation with friends
Multi-generational vacation
Cruise
Visit to a mountain resort
Quiet countryside holiday
Combining business trip with leisure vacation
Other
Source: Resonance 2015 Portrait of the U.S. Millennial Traveler

TYPES OF FUTURE VACATIONS FOR U.S. RETIREES
33%
30%
29%
28%
21%
14%
11%
10%
4%
23%
Visit to a major metropolitan city
Vacation with friends
Cruise
Visit to a beach resort
Multi-generational vacation
Quiet countryside holiday
Visit to a mountain resort
Family vacations with kids
Combining business trip with leisure vacation
Other
Source: Resonance 2015 Portrait of the U.S. Retiree Traveler

VENICE
BARCELONA
AMSTERDAM
ASHEVILLE
SAVANNAH
SONOMA

“THE FUTURE IS
ALREADY HERE –
IT’S JUST NOT VERY
EVENLY DISTRIBUTED.”
- William Gibson
@ C R F A I R

SCENARIO
PLANNING

R E S O N A N C E C O . C O M @ C R F A I R@ C R F A I R

@ResonanceCo
SCENARIO DEVELOPMENT
Scenarios mapping out potential future industry landscapes tend to
unfold into one of four major patterns of change (or combinations).
1. Continuation. The system moves forward along its current
trajectory.
2. Collapse. The system falls apart under the weight of “negative”
driving forces.
3. New equilibrium. The system reaches a balance among competing
forces that is significantly different from the current balance.
4. Transformation. The system is discarded in favor of a new one with
a new set of rules.

TOURISM VANCOUVER 2030
A future looking initiative with the objective
of identifying the ideal scenario for tourism
in Vancouver by 2030.
1// Stakeholder Opportunities / Issues
2// Destination Assessment & Forecasting
3// Online Forum - Factor Priorities
4// Scenario Building Workshop
5// Scenario Development
6// Strategic Evaluation
7// Ideal Scenario and Action Plan
@ C R F A I R

KEY POTENTIAL FORCES
Through this process, stakeholders identified six factors
most likely to influence the future of tourism in Vancouver
thatcould potentially alter the trajectory of visitor growth.
A. YVR as an important hub
B. Limited hotel supply
C. Increased TV budget
D. A terrorism event
E. A global financial crisis
F. Employment constraints

Assuming a moderately faster growth in YVR aviation traffic over the forecast period
would result in a premium of 706,989 total overnight visitors to Vancouver by the end of
2030 compared to the baseline scenario.
FUTURE FORECASTING

Under this scenario, an average of 92,000 visitors per year would be deterred from
visiting Vancouver, which would result in a cumulative loss of almost 1.2 million
visitors by 2030 compared to the baseline scenario.
FUTURE FORECASTING

Assuming that TVan budget grows 1% faster than the historic average, we would
see a premium of approximately 670,000 visits by the end of 2030.
FUTURE FORECASTING

In this scenario, we assume an occurrence of a significant geopolitical crisis or a
terrorism event in a global tourist destination (other than Vancouver), and examine
its effects on our baseline projections.
FUTURE FORECASTING

A global financial crisis would have a moderate impact on Vancouver visitor volume.
It would result in 150,000 fewer visitors in the year following the recession.
FUTURE FORECASTING

If we assume a tight labor market where employment in the tourism sector grows only
marginally and below the historic annual average of 1%, we would expect to see an
average of close to 17,000 fewer visitors annually, resulting in a cumulative loss of 220,000
visitors by the end of 2030.
FUTURE FORECASTING

VANCOUVER VISITOR FORECAST
Based on an analysis of these factors, Vancouver should
expect to welcome between 13 million to 14.7 million
overnight visitors in 2030 – 24% to 40% growth over 2017.

CONTINUATION
SCENARIO
RESONANCECO.COM@CRFAIR

CONTINUATION
• No new hotels rooms and ever-higher ADR
• Vancouver attracts sophisticated cultural explorers and
outdoor enthusiasts
• Youthful, energetic, happy to spend for unique experiences
• High end stores, restaurants and services are doing well
• The shoulder season is increasingly in demand
• Vancouver offerings more closely aligned with Whistler
@CRFAIR

NEW EQUILIBRIUM
SCENARIO

NEW EQUILIBRIUM
• The bump in business travel has been remarkable—the number of
business travellers has grown from 13.5% to 20% of all visitors
• Key catalysts are the city’s booming tech sector and substantial
growth in Vancouver’s commercial space
• Former President Trump’s hostility to immigration and Vancouver’s
proximity to Seattle and California’s tech scene aided growth
• Business travel took up the vacancy slack left after Vancouver’s
usual full-occupancy summer and fall
• The financials of hotel development begin to make sense at last, and
new venues are planned.
@CRFAIR

R E S O N A N C E C O . C O M @ C R F A I R RESONANCECO.COM@CRFAIR
TRANSFORMATION
SCENARIO

TRANSFORMATION
• Continuing high downtown hotel development costs made the
creation of hospitality and meeting venues in the region a smarter
move
• Launch of the very big, very tall cruise ships and a new terminal at
Tsawwassen accelerated regionalization; smaller ships docked
downtown.
• Regional developers partnered with hotel flags that had long been
eager to access the Lower Mainland
• Richmond hotel rooms grew exponentially
@CRFAIR

PREFFERED
FUTURE

RESULTS
@CRFAIR

COMPOSITE
SCENARIO

COMPOSITE
CONTINUATION
NEW EQUILIBRIUM
TRANSFORMATION

• Tourism will grow from 10.5 million to 13.4 million in 2030.
• Spending will increase from $5.063 to $8.749 billion.
• Growth in ADR will increase profitability, and encourage many
leisure visitors and some business travellers to seek out
accommodations and activities in the less-expensive regions.
• Downtown Vancouver remains the hub of tourism activity with
more visitors travelling from outlying neighborhoods
• As tech becomes Vancouver’s dominant industry, commercial space
grows to accommodate the demand. Seasonality becomes less of an
issue as business travel grows year-round.
• Monied business and leisure travellers will create demand for more
sophisticated and upscale experiences and services
COMPOSITE SCENARIO

@ResonanceCo
KEY TAKEAWAYS
1. The future is not one but many.
2. The growth of tourism globally is creating new opportunities and
challenges for destinations.
3. Rather than just reporting on what’s happened, DMMOs will need
to forecast what might happen in order to plan accordingly.
4. Scenario planning is a useful approach to considering a variety of
potential futures.
5. Planning and preparing for a variety of futures will improve the
resiliency and success of both the organization and the destination.

THANK YOU!
www.resonanceco.com
Chris Fair, President
cfair@resonanceco.com
www.tourismeconomics.com
Adam Sacks, President
asacks@oxfordeconomics.com

Why Everything You Know About the Future of Tourism is Wrong

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Was ist angesagt?

Was ist angesagt? (8)

Ähnlich wie Why Everything You Know About the Future of Tourism is Wrong

Ähnlich wie Why Everything You Know About the Future of Tourism is Wrong (20)

Mehr von Chris Fair

Mehr von Chris Fair (7)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Why Everything You Know About the Future of Tourism is Wrong