Tourism and Hospitality Market Forecast: USD 10,708 Million by 2032
(TRAVPR.COM) INDIA - November 27th, 2024 - Global Tourism and Hospitality Market Report | Share, Trends 2024-2032
The global tourism and hospitality market was valued at USD 8,207 million in 2023. The ventilator industry is projected to grow from USD 8,453 million in 2024 to reach USD 10,708 million by 2032, exhibiting a compound annual growth rate (CAGR) of 5.94% during the forecast period 2024-2032.
Current Scenario of the Global Tourism and Hospitality Market
The tourism and hospitality market is at a transformation stage and is experiencing disruption. Changing source destinations and markets, increasing demand for luxury and experiential travel, and ground-breaking business strategies are all uniting to greatly modify the industry landscape. Considering this dramatic change, one of the key trends shaping the market is the vast majority of travel is around home. Moreover, customers progressively prioritise travel and that too on their own terms, which influences the growth of this market. Additionally, in the hospitality sector, asset-light approaches such as management and franchising have become increasingly common, despite boutique and luxury brands are choosing to refrain from these models.
Market Drivers
The growth of the tourism and hospitality market is fuelled by strong demand in Europe and the resurgence of business environments in Asia and the Pacific. As per the data released by UN Tourism in September 2024, about 790 million tourists journeyed abroad in the 1st seven months of 2024, marking an 11 per cent compared to 2023 and just 4 per cent lower than in 2019. Moreover, a rapidly increasing need for group business travel in the last few years has also propelled the market growth. This can be attributed to the improved networking opportunities, increased demand for Team-building operations, rising bookings, emphasis on employee well-being, affordability, and return of in-person events.
Market Restraints
The cost of living crisis, maintaining the online reputation and labour shortages are restricting the growth of the tourism and hospitality market. Inflation affects hospitality businesses on both the consumer demand front and the supply chain side. Based on demand, accommodation companies, ranging from coffee chains to Caribbean resorts, heavily rely on consumer discretionary expenditures. According to a 2023 report by Booking.com, it was revealed that around 3 quarters of travellers signalled that the increasing cost of living was affecting their spending plans. As a result, these factors are hindering the growth of the market.
SEGMENT ANALYSIS
By Type
- Domestic Tourism
- International Tourism
Domestic tourism is the prevailing segment of the tourism and hospitality market and is believed to keep on growth course over the forecast period. Even though international travel may look more appealing, industry stakeholders must acknowledge that domestic travel constitutes the majority of the market, which makes up 75 per cent of travel expenditures worldwide. Apart from this, cuisine has risen as a crucial element influencing traveller’s destination choices, which leads to an increase in tourism in areas renowned for their culinary heritage and local dishes.
By Services Provided
- Accommodation
- Food & Beverages
- Recreation & Entertainment
- Transportation
- Travel
The food & beverages segment is the biggest category of the tourism and hospitality market and is anticipated to keep advancing throughout the estimation period. This can be attributed to the changing consumer preferences and dining habits that are transforming the hotel and accommodation sector. Moreover, food and beverage revenue is increasingly vital to the whole hotel's profitability, marking a shift from previous perceptions where it was viewed as a loss leader. Besides this, there is a rising desire among travellers to explore local cuisines as a way to connect with the culture and heritage of their destinations. Furthermore, as food tourism gains popularity, there is an increasing demand for distinctive and authentic cooking experiences.
By Travel Model
- Business Travel
- Leisure Travel
- Other Activities
Business travel is the rapidly expanding category of the tourism and hospitality market and is expected to continue to drive forward during the estimation period. A 2023 GBTA Business Travel Index Outlook – Annual Global and Report and Forecast, the global business travel industry has recovered more quickly than expected over the past year. In addition, trends in business travel related to low-carbon options received increased attention in 2024, which is contributing to the expansion of the market size of this segment. Apart from this, increased personalisation by business travellers is fuelling the share of the segment. On average, 1.3 billion business trips occur each day in the United States.
REGIONAL ANALYSIS
North America commands the tourism and hospitality market and is believed to maintain its growth during the forecast period. In 2023 and 2024, the United States established itself as a leading player in this market. The country secured the first spot in the Travel & Tourism Development Index (TTDI) for 2024, welcoming more than 80 million foreign visitors or holidaymakers in 2023 and adding 1.8 trillion dollars to the country’s GDP.
Europe witnessed a significant rise in the tourism and hospitality market and is likely to follow an upward trajectory throughout the estimation period. The region has historically housed a major portion of intraregional travel, with 70 per cent of their tourist's international journeys remaining within the continent.
Recent Market Developments
- In November 2024, Lords Hotels & Resorts broadens its offerings with the introduction of Mandala Norling Lords Prime in Kathmandu, emphasizing a mix of traditional Nepalese hospitality and contemporary luxury.
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- Extended Stay Hotel Market
- Sustainable Tourism Market
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