Travel & Tourism - Southern Europe

Southern Europe

Southern Europe is expected to witness a rise in the Travel & Tourism market revenue, which is projected to reach US$69.22bn by 2024.
Moreover, the market is expected to grow annually at a rate of 3.05%, resulting in a projected market volume of US$80.44bn by 2029.
The largest market in the market is the Package Holidays market, which is projected to have a market volume of US$30.10bn in 2024.
By 2029, the number of users in the Package Holidays market is expected to amount to 101.10m users.
The user penetration rate is expected to increase from 55.1% in 2024 to 65.0% by 2029.
Additionally, the average revenue per user (ARPU) is expected to amount to US$0.53k.
It is projected that 79% of the total revenue in the Travel & Tourism market will be generated through online sales by 2029.
Lastly, it is noteworthy that United States is expected to generate the highest revenue in the market, with a projected revenue of US$214bn in 2024, when compared to other countries.
Spain's Travel & Tourism industry is experiencing a rise in sustainable tourism practices, with eco-friendly accommodations and activities on the rise.

Key regions: Malaysia, Europe, Singapore, Vietnam, United States

Definition:

The Travel & Tourism market encompasses a diverse range of accommodation services catering to the needs and preferences of travelers. This dynamic market includes package holidays, hotel accommodations, private vacation rentals, camping experiences, and cruises.

Structure:

The market consists of five further markets.

The Cruises market covers multi-day vacation trips on a cruise ship. The Cruises market encompasses exclusively passenger ticket revenues.
The Vacation Rentals market comprises of private accommodation bookings which includes private holiday homes and houses as well as short-term rental of private rooms or flats.
The Hotels market includes stays in hotels and professionally run guest houses.
The Package Holidays market comprises of travel deals that normally contain travel and accommodation sold for one price, although optional further provisions can be included such as catering and tourist services.
The Camping market includes bookings at camping sites for pitches using tents, campervans, or trailers. These can be associated with big chains or privately managed campsites.

Additional Information:

The main performance indicators of the Travel & Tourism market are revenues, average revenue per user (ARPU), users and user penetration rates. Additionally, online and offline sales channel shares display the distribution of online and offline bookings. The ARPU refers to the average revenue one user generates per year while the revenue represents the total booking volume. Revenues are generated through both online and offline sales channels and include exclusively B2C revenues and users for the above-mentioned markets. Users represent the aggregated number of guests. Each user is only counted once per year. Additional definitions for each market can be found within the respective market pages.

The booking volume includes all booked travels made by users from the selected region, independent of the departure and arrival. The scope includes domestic and outbound travel.

Prominent players in this sector include online travel agencies (OTAs) like Expedia and Opodo, as well as tour operators such as TUI. Specialized platforms like Hotels.com, Booking.com, and Airbnb facilitate the online booking of hotels and private accommodations, contributing significantly to the market's vibrancy.

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Region

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Analyst Opinion

The Travel & Tourism market in Southern Europe has been experiencing significant growth and development in recent years.

Customer preferences: Travelers in Southern Europe are increasingly seeking authentic and immersive experiences, driving the demand for unique cultural and gastronomic activities. They are also placing a strong emphasis on sustainable and responsible tourism practices, favoring eco-friendly accommodations and activities.

Trends in the market: In Spain, the rise of digital platforms and online booking services has revolutionized the tourism industry, making it easier for travelers to plan and book their trips. Italy has seen a surge in experiential travel, with tourists looking to engage in hands-on activities such as cooking classes and vineyard tours. Greece is becoming a popular destination for luxury tourism, attracting high-end travelers with its upscale resorts and exclusive experiences.

Local special circumstances: Southern Europe benefits from its rich cultural heritage, diverse landscapes, and favorable climate, making it a highly attractive destination for tourists from around the world. Countries like Portugal are leveraging their coastal beauty to promote beach tourism, while Croatia is capitalizing on its stunning Adriatic coastline to attract sun-seekers and sailing enthusiasts.

Underlying macroeconomic factors: The economic stability and improved infrastructure in Southern Europe have contributed to the growth of the Travel & Tourism market. The region's strategic location as a gateway between Europe, Africa, and the Middle East has also boosted its connectivity and accessibility, attracting a growing number of international visitors. Additionally, government initiatives to promote tourism and invest in sustainable practices have further stimulated the industry's expansion.

Methodology

Data coverage:

The data encompasses B2C enterprises. Figures are based on bookings, revenues, and sales channels of hotels, vacation rentals, cruises, package holidays, and camping.

Modeling approach:

Market sizes are determined through a bottom-up approach, building on a specific rationale for each market. As a basis for evaluating markets, we use financial reports, the Global Consumer Survey, third-party studies and reports, data from industry associations (e.g., UNWTO), and price data of major players in respective markets. To estimate the number of users and bookings, we furthermore use data from the Statista Consumer Insigths Global survey. In addition, we use relevant key market indicators and data from country-specific associations, such as country-related GDP, demographic data (e.g., population), tourism spending, consumer spending, internet penetration, and device penetration. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, ARIMA, which allows time series forecasts, accounting for stationarity of data and enabling short-term estimates. Additionally, simple linear regression, Holt-Winters forecast, and exponential trend smoothing methods are applied. A k-means cluster analysis allows for the estimation of similar countries. The main drivers are tourism GDP per capita and respective price indices.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change.