Asia to Make up 32% of Travel Spending by 2020
Asia will make up one third of the global travel market by 2020 and the industry must adapt to its new-found consumers, according to a report from Oxford Economics Thursday.
"Asia will account for nearly 22 percent of global arrivals by 2020 (up from 18 percent in 2008) and the region’s residents will account for 32 percent of travel spending by 2020," the report said.
The strong economic growth seen in many of the region's countries will provide the means for greater travel, Adrian Cooper, CEO Oxford Economics, told CNBC.com.
"As the Asian economies develop and people become richer, that will create the wherewithal that will allow people to travel," he said.
Even though European consumers have pulled back on travel spending as a result of the recession, the industry will see recovery from the region, Cooper said. But that growth will be outpaced by that of the Asian region, he added.
The "dramatic realignment of travel spend" toward the East means that the current Western-focused industry will have to change, the report said.
"Emerging markets and the rise of the BRIC (Brazil, Russia, India and China) economies, in particular, are likely to overturn this model in the future," the report said.
The survey carried out by Oxford Economics found that many emerging market economies have "different tastes" to their Western counterparts, including a greater emphasis on traditional foods. Few Western hotels are geared toward Asian travelers, the report added.
Meanwhile, the Western focus on high-profile destinations like the U.S. may also need changing to accommodate developing tastes, according to the report.
One Latin American carrier told Oxford Economics that there was a growing demand for flights within the region as people travel to see relatives more. While other respondents said that some Asian travels favored more cultural destinations.
Meanwhile, the face-to-face experience of a travel agent will become increasingly valued, Philippe Chérèque, executive vice president for commercial at Amadeus IT Group, told CNBC.com.
Simple travel arrangements such as direct flights will continue to be made mostly over the Internet, but with more complicated arrangements, a tailored experience will be increasingly sought after, he said.
Travel companies will also be able to take advantage of the growing demand for tailored arrangements, according to Cooper.
Even the experience of getting a flight can become much more tailored, from fast security and check-in procedures to quiet sections and different foods, he said.