supply tourism industry

Reimagining the $9 trillion tourism economy—what will it take?

Tourism made up 10 percent of global GDP in 2019 and was worth almost $9 trillion, 1 See “Economic impact reports,” World Travel & Tourism Council (WTTC), wttc.org. making the sector nearly three times larger than agriculture. However, the tourism value chain of suppliers and intermediaries has always been fragmented, with limited coordination among the small and medium-size enterprises (SMEs) that make up a large portion of the sector. Governments have generally played a limited role in the industry, with partial oversight and light-touch management.

COVID-19 has caused an unprecedented crisis for the tourism industry. International tourist arrivals are projected to plunge by 60 to 80 percent in 2020, and tourism spending is not likely to return to precrisis levels until 2024. This puts as many as 120 million jobs at risk. 2 “International tourist numbers could fall 60-80% in 2020, UNWTO reports,” World Tourism Organization, May 7, 2020, unwto.org.

Reopening tourism-related businesses and managing their recovery in a way that is safe, attractive for tourists, and economically viable will require coordination at a level not seen before. The public sector may be best placed to oversee this process in the context of the fragmented SME ecosystem, large state-owned enterprises controlling entry points, and the increasing impact of health-related agencies. As borders start reopening and interest in leisure rebounds in some regions , governments could take the opportunity to rethink their role within tourism, thereby potentially both assisting in the sector’s recovery and strengthening it in the long term.

In this article, we suggest four ways in which governments can reimagine their role in the tourism sector in the context of COVID-19.

1. Streamlining public–private interfaces through a tourism nerve center

Before COVID-19, most tourism ministries and authorities focused on destination marketing, industry promotions, and research. Many are now dealing with a raft of new regulations, stimulus programs, and protocols. They are also dealing with uncertainty around demand forecasting, and the decisions they make around which assets—such as airports—to reopen will have a major impact on the safety of tourists and sector employees.

Coordination between the public and private sectors in tourism was already complex prior to COVID-19. In the United Kingdom, for example, tourism falls within the remit of two departments—the Department for Business, Energy, and Industrial Strategy (BEIS) and the Department for Digital, Culture, Media & Sport (DCMS)—which interact with other government agencies and the private sector at several points. Complex coordination structures often make clarity and consistency difficult. These issues are exacerbated by the degree of coordination that will be required by the tourism sector in the aftermath of the crisis, both across government agencies (for example, between the ministries responsible for transport, tourism, and health), and between the government and private-sector players (such as for implementing protocols, syncing financial aid, and reopening assets).

Concentrating crucial leadership into a central nerve center  is a crisis management response many organizations have deployed in similar situations. Tourism nerve centers, which bring together public, private, and semi-private players into project teams to address five themes, could provide an active collaboration framework that is particularly suited to the diverse stakeholders within the tourism sector (Exhibit 1).

We analyzed stimulus packages across 24 economies, 3 Australia, Bahrain, Belgium, Canada, Egypt, Finland, France, Germany, Hong Kong, Indonesia, Israel, Italy, Kenya, Malaysia, New Zealand, Peru, Philippines, Singapore, South Africa, South Korea, Spain, Switzerland, Thailand, and the United Kingdom. which totaled nearly $100 billion in funds dedicated directly to the tourism sector, and close to $300 billion including cross-sector packages with a heavy tourism footprint. This stimulus was generally provided by multiple entities and government departments, and few countries had a single integrated view on beneficiaries and losers. We conducted surveys on how effective the public-sector response has been and found that two-thirds of tourism players were either unaware of the measures taken by government or felt they did not have sufficient impact. Given uncertainty about the timing and speed of the tourism recovery, obtaining quick feedback and redeploying funds will be critical to ensuring that stimulus packages have maximum impact.

2. Experimenting with new financing mechanisms

Most of the $100 billion stimulus that we analyzed was structured as grants, debt relief, and aid to SMEs and airlines. New Zealand has offered an NZ $15,000 (US $10,000) grant per SME to cover wages, for example, while Singapore has instituted an 8 percent cash grant on the gross monthly wages of local employees. Japan has waived the debt of small companies where income dropped more than 20 percent. In Germany, companies can use state-sponsored work-sharing schemes for up to six months, and the government provides an income replacement rate of 60 percent.

Our forecasts indicate that it will take four to seven years for tourism demand to return to 2019 levels, which means that overcapacity will be the new normal in the medium term. This prolonged period of low demand means that the way tourism is financed needs to change. The aforementioned types of policies are expensive and will be difficult for governments to sustain over multiple years. They also might not go far enough. A recent Organisation for Economic Co-operation and Development (OECD) survey of SMEs in the tourism sector suggested more than half would not survive the next few months, and the failure of businesses on anything like this scale would put the recovery far behind even the most conservative forecasts. 4 See Tourism policy responses to the coronavirus (COVID-19), OECD, June 2020, oecd.org. Governments and the private sector should be investigating new, innovative financing measures.

Revenue-pooling structures for hotels

One option would be the creation of revenue-pooling structures, which could help asset owners and operators, especially SMEs, to manage variable costs and losses moving forward. Hotels competing for the same segment in the same district, such as a beach strip, could have an incentive to pool revenues and losses while operating at reduced capacity. Instead of having all hotels operating at 20 to 40 percent occupancy, a subset of hotels could operate at a higher occupancy rate and share the revenue with the remainder. This would allow hotels to optimize variable costs and reduce the need for government stimulus. Non-operating hotels could channel stimulus funds into refurbishments or other investment, which would boost the destination’s attractiveness. Governments will need to be the intermediary between businesses through auditing or escrow accounts in this model.

Joint equity funds for small and medium-size enterprises

Government-backed equity funds could also be used to deploy private capital to help ensure that tourism-related SMEs survive the crisis (Exhibit 2). This principle underpins the European Commission’s temporary framework for recapitalization of state-aided enterprises, which provided an estimated €1.9 trillion in aid to the EU economy between March and May 2020. 5 See “State aid: Commission expands temporary framework to recapitalisation and subordinated debt measures to further support the economy in the context of the coronavirus outbreak,” European Commission, May 8, 2020, ec.europa.eu. Applying such a mechanism to SMEs would require creating an appropriate equity-holding structure, or securitizing equity stakes in multiple SMEs at once, reducing the overall risk profile for the investor. In addition, developing a standardized valuation methodology would avoid lengthy due diligence processes on each asset. Governments that do not have the resources to co-invest could limit their role to setting up those structures and opening them to potential private investors.

3. Ensuring transparent, consistent communication on protocols

The return of tourism demand requires that travelers and tourism-sector employees feel—and are—safe. Although international organizations such as the International Air Transport Association (IATA), and the World Travel & Tourism Council (WTTC) have developed a set of guidelines to serve as a baseline, local regulators are layering additional measures on top. This leads to low levels of harmonization regarding regulations imposed by local governments.

Our surveys of traveler confidence in the United States  suggests anxiety remains high, and authorities and destination managers must work to ensure travelers know about, and feel reassured by, protocols put in place for their protection. Our latest survey of traveler sentiment in China  suggests a significant gap between how confident travelers would like to feel and how confident they actually feel; actual confidence in safety is much lower than the expected level asked a month before.

One reason for this low level of confidence is confusion over the safety measures that are currently in place. Communication is therefore key to bolstering demand. Experience in Europe indicates that prompt, transparent, consistent communications from public agencies have had a similar impact on traveler demand as CEO announcements have on stock prices. Clear, credible announcements regarding the removal of travel restrictions have already led to increased air-travel searches and bookings. In the week that governments announced the removal of travel bans to a number of European summer destinations, for example, outbound air travel web search volumes recently exceeded precrisis levels by more than 20 percent in some countries.

The case of Greece helps illustrate the importance of clear and consistent communication. Greece was one of the first EU countries to announce the date of, and conditions and protocols for, border reopening. Since that announcement, Greece’s disease incidence has remained steady and there have been no changes to the announced protocols. The result: our joint research with trivago shows that Greece is now among the top five summer destinations for German travelers for the first time. In July and August, Greece will reach inbound airline ticketing levels that are approximately 50 percent of that achieved in the same period last year. This exceeds the rate in most other European summer destinations, including Croatia (35 percent), Portugal (around 30 percent), and Spain (around 40 percent). 6 Based on IATA Air Travel Pulse by McKinsey. In contrast, some destinations that have had inconsistent communications around the time frame of reopening have shown net cancellations of flights for June and July. Even for the high seasons toward the end of the year, inbound air travel ticketing barely reaches 30 percent of 2019 volumes.

Digital solutions can be an effective tool to bridge communication and to create consistency on protocols between governments and the private sector. In China, the health QR code system, which reflects past travel history and contact with infected people, is being widely used during the reopening stage. Travelers have to show their green, government-issued QR code before entering airports, hotels, and attractions. The code is also required for preflight check-in and, at certain destination airports, after landing.

4. Enabling a digital and analytics transformation within the tourism sector

Data sources and forecasts have shifted, and proliferated, in the crisis. Last year’s demand prediction models are no longer relevant, leaving many destinations struggling to understand how demand will evolve, and therefore how to manage supply. Uncertainty over the speed and shape of the recovery means that segmentation and marketing budgets, historically reassessed every few years, now need to be updated every few months. The tourism sector needs to undergo an analytics transformation to enable the coordination of marketing budgets, sector promotions, and calendars of events, and to ensure that products are marketed to the right population segment at the right time.

Governments have an opportunity to reimagine their roles in providing data infrastructure and capabilities to the tourism sector, and to investigate new and innovative operating models. This was already underway in some destinations before COVID-19. Singapore, for example, made heavy investments in its data and analytics stack over the past decade through the Singapore Tourism Analytics Network (STAN), which provided tourism players with visitor arrival statistics, passenger profiling, spending data, revenue data, and extensive customer-experience surveys. During the COVID-19 pandemic, real-time data on leading travel indicators and “nowcasts” (forecasts for the coming weeks and months) could be invaluable to inform the decisions of both public-sector and private-sector entities.

This analytics transformation will also help to address the digital gap that was evident in tourism even before the crisis. Digital services are vital for travelers: in 2019, more than 40 percent of US travelers used mobile devices to book their trips. 7 Global Digital Traveler Research 2019, Travelport, marketing.cloud.travelport.com; “Mobile travel trends 2019 in the words of industry experts,” blog entry by David MacHale, December 11, 2018, blog.digital.travelport.com. In Europe and the United States, as many as 60 percent of travel bookings are digital, and online travel agents can have a market share as high as 50 percent, particularly for smaller independent hotels. 8 Sean O’Neill, “Coronavirus upheaval prompts independent hotels to look at management company startups,” Skift, May 11, 2020, skift.com. COVID-19 is likely to accelerate the shift to digital as travelers look for flexibility and booking lead times shorten: more than 90 percent of recent trips in China  were booked within seven days of the trip itself. Many tourism businesses have struggled to keep pace with changing consumer preferences around digital. In particular, many tourism SMEs have not been fully able to integrate new digital capabilities in the way that larger businesses have, with barriers including language issues, and low levels of digital fluency. The commission rates on existing platforms, which range from 10 percent for larger hotel brands to 25 percent for independent hotels, also make it difficult for SMEs to compete in the digital space.

Governments are well-positioned to overcome the digital gap within the sector and to level the playing field for SMEs. The Tourism Exchange Australia (TXA) platform, which was created by the Australian government, is an example of enabling at scale. It acts as a matchmaker, connecting suppliers with distributors and intermediaries to create packages attractive to a specific segment of tourists, then uses tourist engagement to provide further analytical insights to travel intermediaries (Exhibit 3). This mechanism allows online travel agents to diversify their offerings by providing more experiences away from the beaten track, which both adds to Australia’s destination attractiveness, and gives small suppliers better access to customers.

Governments that seize the opportunity to reimagine tourism operations and oversight will be well positioned to steer their national tourism industries safely into—and set them up to thrive within—the next normal.

Download the article in Arabic  (513KB)

Margaux Constantin is an associate partner in McKinsey’s Dubai office, Steve Saxon is a partner in the Shanghai office, and Jackey Yu  is an associate partner in the Hong Kong office.

The authors wish to thank Hugo Espirito Santo, Urs Binggeli, Jonathan Steinbach, Yassir Zouaoui, Rebecca Stone, and Ninan Chacko for their contributions to this article.

Explore a career with us

Related articles.

Make it better, not just safer: The opportunity to reinvent travel

Hospitality and COVID-19: How long until ‘no vacancy’ for US hotels?

A new approach in tracking travel demand

An official website of the United States government

Here’s how you know

Official websites use .gov A .gov website belongs to an official government organization in the United States.

Secure .gov websites use HTTPS A lock ( Lock A locked padlock ) or https:// means you’ve safely connected to the .gov website. Share sensitive information only on official, secure websites.

U.S. Department of Commerce

• Fact Sheets

Was this page helpful?

Fact sheet: 2022 national travel and tourism strategy, office of public affairs.

The 2022 National Travel and Tourism Strategy was released on June 6, 2022, by U.S. Secretary of Commerce Gina M. Raimondo on behalf of the Tourism Policy Council (TPC). The new strategy focuses the full efforts of the federal government to promote the United States as a premier destination grounded in the breadth and diversity of our communities, and to foster a sector that drives economic growth, creates good jobs, and bolsters conservation and sustainability. Drawing on engagement and capabilities from across the federal government, the strategy aims to support broad-based economic growth in travel and tourism across the United States, its territories, and the District of Columbia.

The federal government will work to implement the strategy under the leadership of the TPC and in partnership with the private sector, aiming toward an ambitious five-year goal of increasing American jobs by attracting and welcoming 90 million international visitors, who we estimate will spend $279 billion, annually by 2027.

The new National Travel and Tourism Strategy supports growth and competitiveness for an industry that, prior to the COVID-19 pandemic, generated $1.9 trillion in economic output and supported 9.5 million American jobs. Also, in 2019, nearly 80 million international travelers visited the United States and contributed nearly $240 billion to the U.S. economy, making the United States the global leader in revenue from international travel and tourism. As the top services export for the United States that year, travel and tourism generated a $53.4 billion trade surplus and supported 1 million jobs in the United States.

The strategy follows a four-point approach:

• Promoting the United States as a Travel Destination Goal : Leverage existing programs and assets to promote the United States to international visitors and broaden marketing efforts to encourage visitation to underserved communities.
• Facilitating Travel to and Within the United States Goal : Reduce barriers to trade in travel services and make it safer and more efficient for visitors to enter and travel within the United States.
• Ensuring Diverse, Inclusive, and Accessible Tourism Experiences Goal : Extend the benefits of travel and tourism by supporting the development of diverse tourism products, focusing on under-served communities and populations. Address the financial and workplace needs of travel and tourism businesses, supporting destination communities as they grow their tourism economies. Deliver world-class experiences and customer service at federal lands and waters that showcase the nation’s assets while protecting them for future generations.
• Fostering Resilient and Sustainable Travel and Tourism Goal : Reduce travel and tourism’s contributions to climate change and build a travel and tourism sector that is resilient to natural disasters, public health threats, and the impacts of climate change. Build a sustainable sector that integrates protecting natural resources, supporting the tourism economy, and ensuring equitable development.

Travel and Tourism Fast Facts

• The travel and tourism industry supported 9.5 million American jobs through $1.9 trillion of economic activity in 2019. In fact, 1 in every 20 jobs in the United States was either directly or indirectly supported by travel and tourism. These jobs can be found in industries like lodging, food services, arts, entertainment, recreation, transportation, and education.
• Travel and tourism was the top services export for the United States in 2019, generating a $53.4 billion trade surplus.
• The travel and tourism industry was one of the U.S. business sectors hardest hit by the COVID-19 pandemic and subsequent health and travel restrictions, with travel exports decreasing nearly 65% from 2019 to 2020. 
• The decline in travel and tourism contributed heavily to unemployment; leisure and hospitality lost 8.2 million jobs between February and April 2020 alone, accounting for 37% of the decline in overall nonfarm employment during that time. 
• By 2021, the rollout of vaccines and lifting of international and domestic restrictions allowed travel and tourism to begin its recovery. International arrivals to the United States grew to 22.1 million in 2021, up from 19.2 million in 2020. Spending by international visitors also grew, reaching $81.0 billion, or 34 percent of 2019’s total.

More about the Tourism Policy Council and the 2022 National Travel and Tourism Strategy

Created by Congress and chaired by Secretary Raimondo, the Tourism Policy Council (TPC) is the interagency council charged with coordinating national policies and programs relating to travel and tourism. At the direction of Secretary Raimondo, the TPC created a new five-year strategy to focus U.S. government efforts in support of the travel and tourism sector which has been deeply and disproportionately affected by the COVID-19 pandemic.

Read the full strategy here

• About the ATTA
• Sustainability
• Our Initiatives
• Adventure Travel Conservation Fund
• Leadership & Team
• Internship Program
• Business Development
• Global Travel News
• Industry Spotlight
• Industry Voices
• Member News
• Regional News
• B2B Marketing
• Signature Events
• Market Activation
• Climate Action
• Storytelling
• B2C Marketing
• Event Calendar
• AdventureELEVATE Latin America 2024
• AdventureELEVATE Europe 2024
• AdventureELEVATE North America 2024
• AdventureWeek Finland 2024
• Climate Action Summit 2024
• AdventureWeek Okinawa 2024
• AdventureNEXT Fiji 2024
• AdventureConnect
• ATTA on the Road / Virtual
• Expert Nomination & Topic Suggestions
• Events Sustainability
• Sustainability Resource Center
• On-Demand / Webinars
• Inspiration
• Guide Standard
• Global Payment Resource
• Free Community Membership
• Become a Member
• ATTA Ambassadors
• Active Members
• Adventure Champions
• Community Books
• Case Studies

Shopping Cart

Shopping cart items, understanding the supply chain of travel.

Even for industry veterans, it can be a confusing process to fully understand the supply chain of travel due to the many layers and different terminologies used. This can lead to confusion and a lack of understanding around the complexities within the industry, the cost of doing business, as well as the advantages and disadvantages of the various supplier layers. In addition, innovation, technology, and modernization are changing the travel supply chain model on a regular basis. 

This article will explore the businesses involved in the supply chain, the different terminology used, and also how those terms vary based on where you do business around the globe. For simplicity's sake, here is a classic traditional model that is used often and starts with the traveling consumer.

In this example, the consumer works with a travel advisor, the travel advisor works with an outbound tour operator, the tour operator works with a Destination Management Company (DMC), and the DMC works with local suppliers (operators, accommodations, and transportation). Let’s explore those different layers and the terminologies and meanings of each.

The consumer travels to the destination and experiences the travel product. When a consumer books a trip “direct” with a local supplier or operator, they can skip through many of these intermediaries, which is also referred to as disintermediation. For example, the chain could look like one of these examples: 

While booking direct is a growing trend in the travel industry, in adventure travel the consumer is often looking to  experience more remote destinations and combine various locations and activities. As a result, there is still a greater need for an intermediary than in other tourism sectors. Post-pandemic, having a trusted partner to provide reassurance and protection is more important and valuable than ever before. Let's take a closer look at those intermediaries, and understand the value and benefit of each.

Travel Advisors

(Also known as Travel Agents or Travel Consultants)

The travel advisor is a curator of a personalized experience for a consumer. The travel advisor’s unique role is to understand the needs of their clients and to know the depths of the travel market so they can craft a travel solution that delivers on those needs. Consumers who value not having to spend hours looking for the perfect accommodation, consider how to get from point A to B to C, decide what destinations have the best option for their current activity requests, or research which options are more sustainable, gain great value and benefits from working with a travel advisor.

A travel advisor often charges a small fee to the consumer for their expertise, and they often receive commissions from businesses. For a tour operator, an advantage of working with travel advisors is that a curated traveler is brought to them; if the traveler has a good experience, the advisor or agent is likely to return with future clients. Often, travel advisors remain involved and handle client questions and support. 

One of the greatest values of a travel advisor to a consumer is that in addition to hotels and transportation options, they are knowledgeable about and sell a wide variety of packaged trips from different tour operators, and therefore can provide a diverse range of options. International travel, in particular, can involve more unknowns and uncertainty, making travel advisors' expertise and experience particularly valuable.

Outbound Tour Operator

The outbound tour operator will craft ideal itineraries and sell those itineraries to individuals or groups as a packaged product. The tour operator's value is in knowing current market demand and travel trends and matching those with destinations to keep innovating new products. These are often multi-day itineraries–from three days to three weeks, depending on the destination and experience. 

Tour operators are often specialized and cater to a niche market with specific needs, so travelers who book with them tend to be more loyal. This is especially true in adventure travel, where many operators specialize in activities such as trekking or cycling. Tour operators usually work with DMCs in a destination who help them identify the best local suppliers for their tour needs. A consumer who wants to go on a tour through an operator will sometimes also use a travel advisor because the travel advisor can identify the right tour operator for their needs and also add additional experiences before or after the tour. 

It is also important to note that tour operators usually hold a legal responsibility or bond to safeguard the consumer, depending on the country in which they operate. This adds an extra layer of protection by requiring transparency, information sharing, cancellation rights, and assistance to travelers.

Destination Management Company (DMC)

(Also known as Wholesalers, Ground Handlers, Inbound Tour Operators)

A DMC is a company that sells and packages solutions within their destination. They have deep knowledge of and connections with accommodations, local transportation, and local suppliers who offer logistics and activity options. DMCs get rates from their suppliers for products which they then package and sell to operators, advisors, or even directly to the consumer. In each case, DMCs can be thought of as wholesalers or ground handlers in their destination.

DMCs work with outbound tour operators or cruise companies (specifically expedition cruise companies within adventure travel) to provide options that meet the tour needs. Travel advisors can also work directly with DMCs to provide a menu of activity options and on-the-ground support for clients if issues arise. However, it is important to note that not all travel advisors can work with DMCs due to variations in laws and business practices across different countries.

Local Suppliers

In the growing and ever-changing world of travel there are many businesses that offer services on the ground for travel experiences. These include varying levels and styles of accommodation, transportation, and activities such as kayaking, climbing, food tours, cultural experiences, and more. Local communities are an important part of the travel experience and DMCs’ relationships with and connections to these communities is important. Understanding the sustainability efforts of local suppliers is key as market trends show that 90% of consumers are asking for sustainable travel options.

Online Travel Agencies (OTAs) / Web-Based Marketplace

OTAs are best known for selling flights, hotels, and cars. However, many also sell packages, such as outbound tour itineraries or packaged tours from DMCs.

OTAs curate products from the DMC and directly connect the DMC with the consumer. The DMC is the one crafting the product and selling it to the consumer, while the OTA takes a commission for bringing the consumer to them. In this case the DMC must be able to sell directly to the consumer to be featured in the OTA’s platform. This is particularly true of tailor-made holidays which require a strong local expertise. The resulting supply chain in this example looks like this:

To further complicate matters, OTA can also stand for Online Tours & Activities (such as Viator, Get your Guide, Klook). These are web-based marketplaces that directly curate activities or experiences from the local activity providers and sell them to individual travelers.

Adventure Travel Terminology

At the Adventure Travel Trade Association (ATTA), we often use the term “supplier” when referring to DMCs and local suppliers and the term “buyer” for outbound tour operators and travel advisors.

“Buyers” are the ones directly connected with the consumer and who influence travelers’ destination and activity decisions. They 'buy' or source products and services from local DMCs in the destination.

“Suppliers” or DMCs in general are 'supplying' services from the ground and destination to the outbound market. Online Travel Agencies (OTA) and online wholesalers are also important players in the market.

Example of Global Differences and a Changing Marketplace

The global travel supply chain is a complex puzzle which is constantly changing in a disruptive world and varies depending in which country the company is based. For instance, in the United Kingdom, there is a clearly defined line between tour operators and travel agencies. Outbound tour operators contract directly with local DMCs, while travel agencies sell products from tour operators or UK-based businesses with a UK tourism license. In contrast, in France, travel agencies work directly with local DMCs as well as with outbound tour operators.

In Asia, travel advisors and outbound tour operators are often one and the same business, calling themselves a travel agent, but taking the role of packaging the trip themselves.

Increasingly more popular in the travel industry is the role of the marketing representative or ‘Sales Rep’ who is in charge of promoting and connecting DMCs with outbound tour operators (and possibly travel advisors). They are based in the targeted market destination and very well-connected. They can work on commission or retainer fees, depending on a country’s practices and agreement between the two parties.

An additional disruption in the market are media influencers who sell their own curated tours to their followers where they often lead the group. Since they have already built trust with their audience, their loyal followers are interested in traveling with them to destinations and experiencing travel through their lens and brand.

Special interest groups are another growing niche market, for example avid cyclists might organize an annual trip overseas for their group, where they might work directly with an outbound tour operator, DMC, or even the local suppliers themselves.

Building Relationships

Developing relationships across the complicated global travel supply chain is more important than ever, especially as destinations and businesses recover from the pandemic .  New entrants to the market should ask clear questions when establishing their business relationships to ensure both parties understand their individual roles and expectations and maintain open communication throughout their partnership. 

Mexico's Tourism Industry Reveals Strong Start To 2024

M exico's tourism industry this year has started with positive numbers, mainly in destinations such as Cancun , Puerto Vallarta, Los Cabos and Mexico City, places that have recorded high numbers of visitors from the United States and Canada, mainly.

Meanwhile, Acapulco is gradually recovering from the devastation of Hurricane Otis , which hit that area of the Pacific several months ago.

Mexico started 2024 receiving more international tourists, capturing higher income from foreign visitors, and obtaining an average expenditure of these tourists (who arrive in the country by air), higher than in the same period of 2023.

With data from the International Traveler Surveys of the National Institute of Statistics and Geography (Inegi), the consultancy specialized in tourism, Gemes, announced that, in January, 3.6 million tourists arrived in Mexico, 124 thousand more than in 2023, which represented a growth of 3.6 percent.

On the other hand, each international visitor spent, on average, 808 dollars, which is the second-highest figure recorded. While the average spending of tourists arriving by air recorded an all-time high of $1,262. The total revenue collection for international visitors was 3,143 million dollars, representing the highest revenue in a month of January.

The consultancy firm Gemes reports that, in February 2024, the four airports that recorded the largest influx of foreign tourists were Cancun, Mexico City, Puerto Vallarta and Los Cabos. These are the percentage increases reported compared to 2023:

• Cancun — 10.7 percent
• Mexico City — 2.4 percent
• Puerto Vallarta — 14 percent
• Los Cabos — 5.7 percent

Cancun Airport, which receives visitors mainly from the United States and Canada, recorded the arrival of more than 1 million travelers, which accounted for more than 46 percent of international arrivals in Mexico.

Acapulco Is Back After Hurricane Otis

Months after the devastating Hurricane Otis, the port of Acapulco has begun to recover and has already hosted international events such as the Tianguis Turístico 2024, in which 43 countries participated, as well as sports competitions such as the Mexican Tennis and the GNP Acapulco P1 Premium Padel.

As part of the work of the Tianguis Turístico 2024, the most important trade fair of the industry in Latin America, Miguel Torruco, Minister of Tourism of Mexico, said that about 36,000 business appointments were held in which 1,115 buyers and 833 companies participated.

He said that, after the effects of Hurricane Otis, Acapulco again began to be one of the main destinations for domestic and foreign visitors. This was demonstrated during the past Easter holidays and on the days that the Tianguis Turístico 2024 was developed, in which there was a hotel occupancy of 9,500 available rooms, which meant more than a 13 percent increase.

Little by little, this famous Pacific resort recovers the activities of the tourism industry and, in addition to starting to rehabilitate hotels, tour operators have returned to offer the products that for years have been distinctive of Acapulco, such as the emblematic nailed Playa Pie de la Cuesta (with its beautiful sunsets), Papagayo Park, Fort of San Diego, and Punta Diamante, and the iconic Quebrada, located in the old area of the port and in which visitors admire expert divers who throw themselves more than 30 meters high.

• The Star ePaper
• Subscriptions
• Manage Profile
• Change Password
• Manage Logins
• Manage Subscription
• Transaction History
• Manage Billing Info
• Manage For You
• Manage Bookmarks
• Package & Pricing

Surge in tourist arrivals straining room supply in Philippines: Report

• Philippines

Thursday, 02 May 2024

Related News

Philippines summons Chinese diplomat over South China Sea flare-up

China coast guard becoming 'more aggressive': philippines, philippines keeps schools shut as heat shows no signs of abating.

MANILA: The hotel industry may have some trouble meeting high demand this year as foreign tourist arrivals continue to outpace hotel developments, according to Leechiu Property Consultants Inc.

In its latest Property Market report, the real estate brokerage firm said tourist arrivals in the first quarter of the year reached 1.66 million, up by 18 per cent year-on-year. This marked the highest single-quarter arrivals in the postpandemic stage, it added.

“The introduction of additional direct international flights and the easing of visa restrictions for certain source markets, a strategy employed by other countries to attract more foreign tourists, contributed to the increase in arrivals,” Leechiu said.

It pointed out, however, that there may be a potential shortage in hotel supply due to construction delays and high costs of funding exacerbated by the economic impact of the Covid-19 pandemic.

To recall, the Department of Tourism aims for 7.7 million tourist arrivals this year. This is expected to grow by up to 10 percent annually until 2028.

However, Alfred Lay, Leechiu head of hotels, tourism and leisure, said the projected growth in hotel keys from 2025 to 2028 was less than 1 per cent.

The shortage may pull up room rates, and “it will become a more expensive pastime for us to travel locally and for foreigners to come here,” Lay explained.

Last year, the local hotel industry had an occupancy rate of 65.2 percent, still lower than the prepandemic average by 8 percentage points.

While upscale hotels in central business districts have yet to regain their prepandemic performance, upscale hotels have already shown resilience, according to Leechiu.

The company expects a “complete rebound” in overall hotel performance by next year.

In the meantime, Leechiu recorded a total of 24,267 keys in the pipeline across 87 hotel projects throughout the country.

Of this, 9,668 are located in Metro Manila, while the rest are in Cebu, Bohol, Boracay, Davao and Palawan.

Leechiu also reported that the real estate sector was expected to remain resilient despite the high interest rate environment as developers continue to diversify their portfolio and achieve high yields.

It said the local property market was particularly looking forward to the potential policy rate cuts that may be implemented by the Bangko Sentral ng Pilipinas (BSP) within the year.

“On the surface, the market looks calm and steady,” said Leechiu director Tam Angel. “But actually, the whole market and everyone involved—the stakeholders, BSP, developers and consultants—are working hard to keep things afloat.”

During the Monetary Board’s April 8 meeting, it maintained the BSP’s rate at 6.5 per cent to tame inflation.

Leechiu said the delay in anticipated cuts was beginning to exert pressure on the market, raising concerns on the resilience of capital values, especially in central business districts.

However, the company also pointed out that developers were now “strategically diversifying” their investments to include the industrial and tourism sectors in response to the “higher-for-longer” interest rate environment.

In turn, this investment shift could enhance yields and position for more growth opportunities.

High interest rates typically nag on the performance of property firms, as these could pull up prices and weaken demand.

Property firms are also encouraged by the International Monetary Fund’s 6.2-percent revised growth forecast for the country that was better than the 5.5-percent growth recorded last year and the 2.9-percent global average.

Still, Leechiu noted that stakeholders would monitor inflation trends and policy rate decisions to sustain market stability and growth. - Philippine Daily Inquirer/ANN

Tags / Keywords: Philippines , hotels , tourism

Found a mistake in this article?

Report it to us.

Thank you for your report!

CHARTING A NEW PATH FOR HEALTHCARE

Next in aseanplus news.

Trending in AseanPlus

Air pollutant index, highest api readings, select state and location to view the latest api reading.

• Select Location

Source: Department of Environment, Malaysia

Others Also Read

Best viewed on Chrome browsers.

We would love to keep you posted on the latest promotion. Kindly fill the form below

Thank you for downloading.

We hope you enjoy this feature!

Tourism Supply and Demand

• First Online: 30 September 2017

Cite this chapter

• Mark Anthony Camilleri 2  

Part of the book series: Tourism, Hospitality & Event Management ((THEM))

96k Accesses

12 Citations

2 Altmetric

The demand for tourism products may be affected by the marketing mix elements, including the nature of the product or service, its distribution, its promotional strategies and its price. Price is the only element in the marketing mix which actually produces revenue. However, the setting of a price is not an easy task, as there are a number of pricing strategies which any travel business may apply, including; prestige pricing, penetration pricing ; cost-based pricing ; differential pricing and uniform pricing . Moreover, there are a number of factors which will influence what type of pricing strategy could be employed. Such factors include; corporate objectives; the marketing objectives, and the organisations’ cost levels, among other matters. This chapter explains the various approaches which may be utilised when setting prices. Ultimately, the customers themselves will decide whether the product that is being supplied to them will meet or exceed their expectations.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

• Available as PDF
• Read on any device
• Instant download
• Own it forever
• Available as EPUB and PDF
• Compact, lightweight edition
• Dispatched in 3 to 5 business days
• Free shipping worldwide - see info
• Durable hardcover edition

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Author information

Authors and affiliations.

Department of Corporate Communication, University of Malta, Msida, Malta

Mark Anthony Camilleri

You can also search for this author in PubMed   Google Scholar

Corresponding author

Correspondence to Mark Anthony Camilleri .

Rights and permissions

Reprints and permissions

Copyright information

© 2018 Springer International Publishing AG

About this chapter

Camilleri, M.A. (2018). Tourism Supply and Demand. In: Travel Marketing, Tourism Economics and the Airline Product. Tourism, Hospitality & Event Management. Springer, Cham. https://doi.org/10.1007/978-3-319-49849-2_8

Download citation

DOI : https://doi.org/10.1007/978-3-319-49849-2_8

Published : 30 September 2017

Publisher Name : Springer, Cham

Print ISBN : 978-3-319-49848-5

Online ISBN : 978-3-319-49849-2

eBook Packages : Business and Management Business and Management (R0)

Share this chapter

Anyone you share the following link with will be able to read this content:

Sorry, a shareable link is not currently available for this article.

Provided by the Springer Nature SharedIt content-sharing initiative

• Publish with us

Policies and ethics

• Find a journal
• Track your research

Money latest: Billie Eilish fans furious at 'outrageous' ticket prices

Billie Eilish fans are complaining about "outrageous" ticket prices for her Hit Me Hard and Soft tour. Read this and all the latest consumer and personal finance news below, plus leave a comment in the box.

Thursday 2 May 2024 20:01, UK

Please use Chrome browser for a more accessible video player

• OECD warns UK shouldn't cut interest rates yet
• UK ranks bottom in G7 economic growth forecast
• 'Outrageous': Billie Eilish fans complain about ticket prices
• Aldi's market share falls as people head back to traditional supermarkets (except one)
• New ISA rules were supposed to help savers - right now they've just made everything more complicated

Essential reads

• How to nab yourself a free upgrade on a flight
• You're probably washing and storing your clothes wrong. Here's what you should do instead
• Money Problem : 'Builders won't repair dodgy work - what are my rights?'
• '£2,000 landed in my account' - The people who say they're manifesting riches

Ask a question or make a comment

If you earn significantly more or less than your partner, how do you split payments for things like housing, food, household essentials, entertainment and holidays? 

Do you both pay equally, do you split costs according to income, or do you have another method? 

Get in touch with an outline of your situation in the  box above or:

• Email [email protected] with the subject line "Money blog"
• WhatsApp us  here .

Pint-sized bottles of wine will be allowed on UK shelves from autumn under new post-Brexit trade rules - although doubts have been raised over their demand.

Seven changes to pre-packaged wine sizes are due to come into force on 19 September.

The move to introduce the 568ml size of wine, to sit alongside 200ml and 500ml measures already available, was announced in December and hailed by ministers as a Brexit "freedom".

Pint bottles of Champagne were sold in the UK before Britain joined the European Common Market and were on shelves until 1973.

Read more here ...

JD Sports has told head office staff they must return to the office at least four days a week .

The new amendment to the hybrid working policy will be effective from 1 July and will impact employees at the retail chain's head office in Bury, Retail Gazette reports.

However, the chain will still allow flexibly depending on individual roles.

Pubs could stay open late during the Euros this summer, according to The Sun .

Home Secretary James Cleverly hinted he was looking into extending pub opening hours for the tournament on The Sun show Never Mind The Ballots.

He said: "I will certainly look into it."

We've been bringing you news of plenty of bank switch deals offering free cash these past few months, but Virgin Money has a different kind of incentive for switchers - a 12% interest rate. 

People who switch to its M Account, M Plus Account or Club M Account will be able to get bonus interest rates of 10% gross/10.47% AER (fixed). 

This is on top of the 2% gross/2.02% AER (variable) interest rate already offered on current account balances up to £1,000 - meaning customers can get an interest rate of 12%. 

No other savings accounts offer interest rates this high, and the bonus applies for a year.

TikTok will restore millions of songs to its app after settling a royalty dispute with Universal Music Group. 

Users had been unable to make videos featuring songs from the likes of Billie Eilish and Ariana Grande due to a row over how much TikTok was paying. 

The fight had led to Universal withdrawing music from some of the world's most famous singers. 

The dispute appears to have been settled as the companies announced "improved remuneration" for artists.

More than 10,500 black cab drivers in London have launched a £250m legal case against Uber. 

They accuse the app of breaking the capital's taxi booking rules and deliberately misleading authorities to secure a licence. 

Transport for London (TfL) rules state drivers cannot take bookings directly from customers and must instead use a centralised system. 

The drivers, who are being advised by law firm Mishcon de Reya, argue they have faced unfair competition from Uber and that it knowingly broke these rules. 

Uber has denied these allegations and said the claims are unfounded.

The company has faced numerous challenges in London, including refusals from TfL to renew its licence which were later successfully appealed. 

Billie Eilish fans are complaining about "outrageous" ticket prices for her Hit Me Hard and Soft tour.

The 22-year-old singer unveiled an 81-date tour programme this week, sending fans rushing to secure tickets.

But some expressed disbelief on social media at the prices.

"I know I moan about this all the time, but look at the price of Billie Eilish tickets," one fan called Marianne wrote on X, sharing a screenshot of seated tickets priced at £398.50. 

"Something seriously needs to be done about ticket prices, it's f*****g outrageous!" 

Another complained they had paid less for Taylor Swift's Eras Tour, which was also criticised for high ticket prices.

A fan called Liv tagged Eilish, Live Nation and Ticketmaster, writing: "Are you ok? £145 for standing tickets is atrocious."

Thousands of people who receive government benefits, including Universal Credit, will be paid as early as tomorrow.

This is because there's a bank holiday coming up on 6 May which will affect benefits paid by both the Department for Work and Pensions (DWP) and HMRC (they don't pay benefits on bank holidays).

A statement on the government website reads: "If your payment date is on a weekend or a bank holiday you'll usually be paid on the working day before. This may be different for tax credits and child benefit."

Here are the 11 different government benefits that are expected to be paid early:

• Universal credit;
• State Pension;
• Pension Credit;
• Disability Living Allowance;
• Attendance Allowance;
• Carer's Allowance;
• Child Benefit;
• Income Support;
• Jobseekers Allowance;
• Personal Independence Payment;
• Tax credits (such as Working Tax Credit)

Will your benefit payment change?

No, you'll be paid the same amount you usually receive.

Benefits are usually paid straight into your bank, building society or credit account.

Goldman Sachs is removing a cap on bonuses for London-based staff, paving the way for it to resume making multimillion pound payouts to its best-performing traders and dealmakers.

Sky News can exclusively reveal the Wall Street banking giant notified its UK employees today that it had decided to abolish the existing pay ratio imposed under European Union rules and which the government recently decided to scrap.

In a video message to staff, Richard Gnodde, chief executive of Goldman Sachs International, which comprises its operations outside the US, said it had decided to bring its remuneration policy in Britain in line with its operations elsewhere in the world.

"We are a global firm and to the extent possible we adopt a consistent global approach across everything we do," Mr Gnodde said in the message, which has been relayed to Sky News.

"The bonus cap rules were an important factor preventing us from being consistent in the area of compensation."

Aldi's market share has fallen - as people seemingly head back to traditional supermarkets for their shopping.

Aldi's share of the grocery market slipped from 10.8% to 10.4% in the 12 weeks to 20 April.

NIQ data shows sales rose just 1.3% in the period - for Morrisons it was 4.4%, Tesco 5.8% and Sainsbury's 6.6%.

Asda was the laggard with sales falling 0.9%.

Ocado is the fastest growing retailer with sales up 12%.

Aldi's rival discounter, Lidl, saw sales surge 9.5%, bumping its market share up to 8.2%. Media campaigns highlighting new ranges helped, NIQ said.

A Santander online outage is affecting thousands of UK customers.

Over 2,000 reports have been made on Downdetector - indicting the issue is widespread.

Customers have been met with messages like this...

Santander wrote on X: "We are aware some customers are experiencing issues accessing online services, we apologise for any inconvenience this has caused.

"We're working hard to resolve this as soon as possible."

Following on from our previous post, and the OECD also says the UK will grow more slowly next year than any other major advanced economy.

It puts this down to stealth taxes and high interest rates squeezing the economy.

The organisation, which is based in Paris, downgraded its forecasts for GDP to 0.4% this year and 1% in 2025.

In February, the UK had been in the middle of the rankings with forecast growth of 0.7% this year and 1.2% next.

The OECD pointed to the fact "tax receipts keep rising towards historic highs" - with National Insurance cuts not offsetting the additional burden Britons are feeling due to tax thresholds not rising along with inflation due to a government freeze.

Some good news is expected for UK workers as the OECD said there will be "stronger" wage growth when inflation is factored in against pay.

Be the first to get Breaking News

Install the Sky News app for free