The Mastercard Economics Institute has released its Travel Industry
Trends 2023 report, shedding light on the latest developments in global
travel. The report emphasises the resurgence of leisure and business
travel, the reopening of mainland China, and the enduring preference for
experiential journeys.
Key findings:
- Leisure and business travel are growing at the same pace, with
flight bookings up approximately 31% in March 2023 compared to 2019,
driven by the lifting of travel restrictions in Asia.
- Mainland China's reopening following Covid-19 regulations relaxation
is expected to have a positive impact on the global and Asia Pacific
tourism industry. Pent-up demand for travel is anticipated to drive
strong growth, benefiting economies with close ties to China.
- Travellers are venturing further from home, establishing new
corridors. The US and Australia remain popular destinations for
travellers from the Asia Pacific region, while Hong Kong has seen
increased visitor numbers, ranking third on the list of top destinations
in February 2023.
- The preference for experiences over material possessions continues,
with spending on experiences up 65% compared to 2019. Travellers are
seeking cultural immersion in lesser-known destinations and are
prioritising unique travel experiences.
- Corporate travel has caught up with leisure travel, indicating a
strong return to office culture in many regions. Demand for in-person
meetings and commercial travel has shown significant growth,
particularly in the Asia Pacific and Europe regions.
- Spending on experiences in Singapore has surged, with a 264.7%
increase in March 2023 compared to the same month in 2022, following the
easing of Covid-19 restrictions.
David Mann, chief economist for Asia at the Mastercard Economics
Institute, anticipates a strong demand for travel that will extend
beyond the initial "revenge travel" phase. However, the challenge lies
in whether flight and accommodation supply can keep pace with this surge
in demand.
Mann added that to cater to evolving consumer expectations,
comprehensive support for travellers and the tourism sector is crucial.
Companies must focus on enhancing the entire travel experience, from
booking to on-ground services, by offering diverse payment options,
personalised recommendations, and tailored offers. By keeping the
individual traveller at the centre of engagement, companies can foster
long-lasting and valuable relationships.