australia outbound travel trends

Outbound Travel TrendsDecember 2015

Country Report

Australia - Outbound Travel Trends

Did You Know?

• Australia ranks 7th out of 141 countries in Global Travel

and Tourism Competitiveness. (WEF Report, 2015)

• Australia is the 9th largest spender on travel abroad

(UNWTO, 2014).

• Though a greater majority of Australians holiday

within the country, the trend for outbound travel is well

entrenched.

• As a nation of immigrants, Australians usually have

friends and relatives scattered around the world and

their travel plans often involve them.


Current Scenario


8% Growth In Outbound Traffic

• Increased outbound travel was driven by VFR visitors

(up 14.7 per cent to 1.9 million visitors) and holiday

visitors (up 6.2 per cent to 4.5 million visitors).

• Marginal increase in business trips (up 0.8 per cent).

• Decrease in average length of trip resulted in outbound

business visitor expenditure falling by 10.7 per cent to

$6.6 billion.

* 2014 figures


Propensity Increased To

42 Trips

Propensity for

outbound travel

increased to 42 trips

per 100 people in

in the year ending

March 2014; up

from 26 trips in the

year ending March

2006.


All Segments Travel

• Touring youths - young people touring the world

on minimal budgets.

• DINKS - double income no kids.

• SINKS - single income no kids.

• Families - prefer South-east Asia, Pacific Islands…

• Retirees and empty- nesters - over 55s , in search

of distant relatives ,cultural heritage or new

experiences.


Slight Decline In Travel By 35-64 Group

Age of short-

term outbound

travellers

2007 2012

000s % 000s %

0-4 years 170 3.1 303 3.7

5-14 years 362 6.6 561 6.8

15-24 years 589 10.8 938 11.4

25-34 years 951 17.4 1,516 18.4

35-44 years 1,038 19.0 1,428 17.4

45-54 years 1,110 20.3 1,534 18.7

55-64 years 834 15.3 1,234 15.0

65-74 years 315 5.8 564 6.9

75+ 94 1.7 143 1.7

Total 5,462 100.0 8,220 100.00


Short-term refers to the intention to stay abroad for less than 12 months.

Increase In Travel By Older Segments


Under 16 6%

16-24 17%

25-34 29%

35-44 4%

45-54 13%

55+ 31%

Under 18 years 7%

18-34 years 23%

35-54 years 22%

55+ years 47%

Ireland, 2012 Canada, 2011

• The age at which people were most likely to go overseas for holiday

shows two peaks - the first around age 26 years for women and 29

years for men, then a longer peak of around 49-60 years for women and

late 50s and early 60s for men.

• However, UK receives holiday visitors from all age bands. Destinations

like India receive more of Australian holiday visitors in the 25-34 and

35-44 age groups. .

Heavily Influenced By Online Sources

• Though recommendation from past visitors, family and friends are important, Australians depend heavily on online sources for information.

• For USA: travel agency office, online travel agency, airline websites and personal recommendation are the top sources of information.

• For UK : friends, relatives or colleagues influence destination choice the most followed by special offers, hotel websites and traveller review sites.

• For Singapore: internet is the top source of information before travel for the Australians. Travel agents come next followed by recommendations from past visitors, travel guides and recommendation from friends or family.

• For Canada: past visitors and a mix of traditional media, the travel trade and online sources.


NSW, Leading Source Market

34%

25%

17%

15%

5%

2%1%

1%

Percentage Share*New South Wales (NSW)

Victoria

Queensland

Western Australia

South Australia

The Federal Capital

Tasmania

Northern Territory


* 2012 statistics

Asia, Main Outbound Region

Europe, Oceania and the Americas have lost ground to Asia in the

recent years for outbound travel from Australia.


46%

21%

15%

13%

3% 2%

Percentage Share*Asia

Oceania

Europe

Americas

North Africa &

Middle East

Sub-saharan Africa* 2012 statistics

Asia, Europe For

Multi-Destination Trips

Single destination trips usually to

New Zealand, the Pacific

Islands, North America.


Asia and Europe leads in multi-

destination trips.

Holiday, Prime Purpose

Visiting friends and relatives (VFR) is the main

reason for Australians travelling to UK, Continental

Europe and North America .


September, Peak For

Holidaying

• September is peak for holiday travel and December for VFR.

• Short term outbound travel peaks in June, September and December.

• January, February and March are usually slack.

• However countries like India receive maximum visitors in the first (Jan-Mar) and

fourth quarter (Oct-Dec).

• Ireland receives highest number of Australian visitors from Oct-Dec followed by

Jun-Jul.


Booking, 3-6 Months Prior To Travel

• To Canada

Over 50% of recent visitors booked their holiday within three months of travelling; 18% booked more than six months prior to travel.

• To UK

Half of all holidays to Britain booked more than 6 months before departure with a further 29% between 3 and 6 months.

• To Singapore

1 in 3 respondents of a survey by the tourism board, book 4- 6months ahead of the trip.


Singapore, Top Destination

Malaysia, China, Indonesia, Fiji and Singapore are expected to be the top five

fastest growing (main) destinations to be visited by Australian residents in

2015.


Longest Holiday In Europe

Holidays abroad are usually long as most trips are long haul. Average length of all

outbound trips was 20 nights.


Europe *

36 nights

Middle East/Africa

34 nights

Americas

26 nights

Asia

16 nights

Oceania

10 nights

*Average length of stay, 2012

High Average Spend

• Ninth largest spender on travel abroad (UNWTO)

• Overall spending per trip between A$ 3,200 and A$3,800 over the last

five years.

• High average spend due to Australia's status as one of the world's more

affluent countries and to its remoteness from many important

destinations which leads to long-haul travel and more spend.


FITs On The Rise

• Australians have a reputation for being confident and

active travellers with strong compatriot support networks

in many destinations.

• FITs(Free Independent Traveller) predominate especially

to European destinations.

• Small group tours are also becoming popular.

• For Canada, nearly 60% of recent visitors travelled

independently, while 18% opted to take fully escorted or

guided tours.

• Half of holiday visits to US were with a Spouse/Partner ;

about one in five are by lone travellers.


Culture & Heritage, Nature, Sports

Preferred• Australians love heritage, culture, landmarks, places

of natural beauty, beaches...

• Addicted to sports and love to watch sporting events

or participate in sports while on holiday.

• Shopping is preferred in some destinations.

• Youth prefer social experiences, new friends and city

cultures.

• Senior Citizens prefer cultural experiences, heritage

sites, outdoor sports.


Preferred Activities, Destination-wise

• UK Trip to museums, art galleries and built heritage sites, theatre, walk in the countryside...

• IrelandGolf, hiking and cross country walking.

• US Shopping, national parks and monuments, sightseeing, guided tours, historical locations. Preference for sporting events and visiting theme parks are on the rise.

• Singapore Shopping, local tours, visit to well-known landmarks, VFR, cultural and historical attractions.

• Canada Culture, history, visiting main attractions and places of natural beauty.


What‟s Trending?


SEA Most Popular

• South East Asia(SEA) remained on top of the most

popular places for Australians to travel to in 2015 (20

per cent) followed by Europe (18 per cent), New

Zealand (16 per cent) and America (15 per cent).

• Malaysia, China, Indonesia, Fiji and Singapore to be

the top five fastest growing destinations to be visited

by Australian residents in 2014-15.


Multi-gen Travel, Experiences &

Personalisation Holds The Key

• Multi-generational travel:

The new family holiday includes multiple generations travelling together. Experiences feature activities that are suitable for grandparents and toddlers, as well as entertaining for teenagers and parents. Cruising is a prime example of a travel trend that caters to this market.

• Meet the maker:

Workshops with hotel representatives, such as hotel florist, tour by the art buyer and/or architect or interior designer. …Consumers are increasingly interested in the quality and vision behind experiences and places.

• Personalised Amenities:

An increasing trend is exclusive and quirky hotel amenities that reflect the brand‟s personality. - bespoke shower products, quirky quotes on hotel pillows, stress balls, cupcakes with names ...

• All-inclusive:

Increasingly popular in tropical destinations such as the Maldives, or on cruises, Travellers love to leave their wallet at home for all-inclusive stays that include dining, spa, activities and alcohol.


Social Media, YouTube Leads

• YouTube remains the highest growing social media platform

followed by Facebook.

• Video is a new trending tool to provide insights on experiences

and travel. Over 50% of Australians on Facebook watch video on

the platform daily.

• SnapChat is another element of this video expansion, as more

brands are sponsoring the app, live broadcasting global events

and featured destinations to millions of consumers.

• Australian bloggers still remain leaders in the travel market, with

the number of influential bloggers and digital personalities

increasing month-on-month.


Outbound Grinding To A Halt?

• Deloitte's Tourism and Hotel Market Outlook Mid Year Update

2015 indicates that the weaker Aussie dollar is having a major

impact on travel patterns with outbound growth by Australian

travellers "grinding to a halt" while domestic holidays grow in

popularity.

• After growing at an average rate of 11% a year for the last

decade, outbound holiday travel came to a grinding halt, falling

0.2% over the year to June.

• The growth in trips is slowing and Australians are opting for

cheaper destinations, staying for shorter periods and spending

less.


Forecast – Medium Term


Modest Growth Of 3.2-3.4 Percent


• After strong increases in most years from the mid-

2000s, Australian resident outbound departures

slowed considerably in 2014-15.

• Modest growth is forecast to continue in the

coming two years, with outbound departures

expected to grow by 3.2 per cent to 9.5 million in

2015-16, and 3.4 per cent to 9.9 million in 2016-17.

Other Asia, Indonesia, NZ – Main

Destinations


While a downward revision has occurred for some long-haul destinations such as the

UK and Other Europe for 2015–16 and 2016–17, forecasts for short-haul destinations

including New Zealand, Fiji, Thailand and Other Asia are higher.

Departure Growth By Main Destinations, 2015-16 & 2016-17

Forecast – Long Term


Departures Revised Down

• Departures growth per annum is revised down.

• This can be attributed to the weaker assumptions for Australian GDP

growth and the lower value of the AUD which is likely to have a

dampening effect on Australian residents‟ overseas travel.


The Country – A Snapshot


Interesting Facts

• 6th largest country in the world.

• 3rd largest ocean territory in the world.

• 19 world heritage listed sites.

• If Australia were a city, at 23.5 million it would still only be the

world's seventh largest (after Tokyo, Guangzhou, Shanghai,

Jakarta, Seoul and Delhi).

• World's highest proportion of migrant settlers in a developed

nation.

• Australia is currently growing by 1 million every 2 years - that's

an additional Adelaide every 2.5 years.


Economy At A Glance

• GDP (current US$) - $1.454 trillion, 2014

• GDP per capita (current US$) - 61,887.0, 2014

• Ranked 9th globally for wealthy individuals.

• High Net Worth Individuals (HNWIs) -

226,000, 2014.


Population At A Glance

• Population, total - 23.49 million 2014 (52nd most

populous country in the world)

• Population Density - 3 per sq km. (very sparse)

• Urban Population - 90%

• Median Age - 36.8 years

• Households - 7.8 mn (Census 2011)


Conclusion

• European Travel Commission notes that outbound travel is becoming less of a lifestyle priority for Australians particularly among the younger generations. Reluctance to use credit to fund travel places a constraint on long-haul travel.

• A bleak picture for the medium term is given by both Deloitte and Tourism Research Australia.

• The weakening of Aussie Dollar, the impacts of a slowdown in Chinese economy, lower growth in the number of “empty nesters” (aged between 50-years-old and 70-years-old) -an impetus behind outbound growth – all these may have a role in the slow-down.

• However, outbound travel will continue at a modest pace with Australians opting for less expensive and nearby destinations.


References

• Canadian Tourism Commission, ‘Australia Market Profile’, January 2013.

• Capegemini/RBC, ‘World Wealth Report’, 2015.

• Deloitte Access Economics, „Tourism and Hotel Market Outlook -Mid Year Update‟, August 2015.

• European Travel Commission, ‘Market Insights - Australia’, January 2014.

• Hatching Communications, „Australian Market Travel Trend Report’, Q2 2015.

• Singapore Tourism Board, Market Insights – Australia, March 2014.

• Tourism Research Australia, „Tourism Forecasts’, 2015.

• Tourism Research Australia, „Tourism Forecasts’, Autumn 2014.

• Tourism Research Australia, „State of the Industry’, 2014.


References

• Tourism Ireland, „Australia Market Profile’.

• Tourism Research Australia, „What is driving Australians' travel

choices?’, June 2011.

• U.S. Department of Commerce International Trade

Administration, 2014 Market Profile: Australia, 2014.

• Visit Britain, ‘Australia Market and Trade Profile’, December 2014.

• http://data.worldbank.org/

• www.weekendnotes.com

• http://www.news.com.au/



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Disclaimer

This report is based on the information from the

published sources and references mentioned and

inferences drawn are from them. Stark Tourism is not

responsible for errors/omissions that could have crept

in knowingly or unwittingly.
