Demographic developments are the kick-off for the megatrends in tourism. Those who recognise the potential of demographic developments, and the different generations can help shape the future of tourism. These different generations have a major impact on tourism and will greatly change the way we know tourism today. The Organisation for Economic Co-operation and Development (OECD) shows the trends until 2050.
Global changes in demography
We are living in a time of transformation and change, not only in terms of technology but also in terms of society. By 2050, 9.7 billion people will live on this planet. The great potential for tourism lies in the differences between people. On the one hand, these can be divided into countries and the most diverse social classes. On the other hand, the different age groups have to be considered. They will have a great influence on tourism. Those who know their target market are clearly at an advantage and can already build the foundation for the future.
The different development of countries
The global middle class will grow strongly. But technologisation will also influence this group. What is particularly exciting is global economic growth, which will be different in all countries. For example, a sharp rise in the middle class is expected in developing countries, while many industrialised countries will see little change in this group. However, it is the rising middle class that is particularly forward-looking for tourism, as there are usually enough financial resources for (short) holidays.
A targeted division of source markets, generations and income levels makes sense in order to address the respective groups. For example, Millenials and Generation Z from current developing countries will have an enormous impact on travel behaviour by 2050 and will permanently change the tourism industry (Kyyrä and Rantala, 2016).
The ageing population
The different generations and the ageing population are already having a huge impact on the tourism industry, and this will continue to intensify in the future. Life expectancy is continuously increasing, while the birth rate in industrialised countries is decreasing (ESPAS, 2015). The ageing population is becoming an increasingly important source of revenue for tourism. This group can usually fall back on sufficient financial reserves, while the willingness for more leisure activities is increasing. In this respect, tourism is already benefiting greatly. In the UK, people over the age of 65 spent four times as much money on trips abroad as people under 35 (OECD, 2019).
Surprisingly, a change is taking place with the baby boom generation. Unlike previous retirees, their self-image is characterised by "not being too old to travel". On the contrary. Vitality, variety and the need to discover the world in old age will play a major role for this generation in the coming years. Educational trips are also becoming more and more interesting (Horwath & Partner).
The young generations
Probably the biggest change in recent years is happening through two generations: Millennials and Generation Z. Two generations are becoming key figures in tourism, with different needs, values and expectations of their holidays.
Millennials already represent 20% of all international tourism. They already take several holidays and trips a year, with an average of four holidays per year (Globetrender, 2017). Millennials value authentic experiences on holiday, they want to experience regional culture and specifics first hand (Future Foundation, 2016). Group travel will decline sharply, this generation focuses on uniqueness and individual experiences. Digitalisation will play an increasingly important role, as will the correct use of technologies and the increase of transparency on holiday (Horwath & Partner).
The first generation to grow up with new technologies. Social media use is commonplace, and holiday planning is also heavily influenced by social media and peer recommendations. Unique and customised experiences are also important to this generation (OECD, 2019). Holidays need to be uniquely designed and can be quite varied and risky (Globetrender, 2017). In the future, there will be a focus on numerous platforms and digital interaction options in hotels. While the baby boomer generation values personal interaction, this generation focuses on efficiency and quick retrieval of information in real-time (Horwath & Partner).
Impact on tourism
How can you make yourself fit for the future? We have exclusive recommendations for you on how to cope with the global changes in demographics.
- Internal hotel planning: As a hotelier, you will also be increasingly affected by demographic change. Your employees are getting older, and fewer young people are joining them. Use digital concepts now and reduce your workload. With the use of smart hotel solutions, you can already save on staff and make yourself fit for the future. Also be open to new concepts, for example, you can rely on an international staff rotation with several establishments. Here, your staff rotates in different establishments at certain intervals, which leads to an efficient exchange of staff.
- Barrier-free conception: You will certainly have to make some investments in the coming years. Invest now in barrier-free access to your hotel and all amenities (rooms, restaurant, wellness area). By doing so, you pave the way for the silver generation, but also for people with disabilities. The EU expects up to 39% more revenue through barrier-free overall concepts in holiday destinations (Miller, 2014).
- Tailor offers: Be aware that there are different target markets and generations with different needs, expectations and values. Each group needs its own marketing, its own concepts, its own offers and its own holiday experiences. Offer digital interaction opportunities for the younger generation or create local offers to give your guests regional insights. NeedNect Solutions helps you to get to know your guests and to create tailor-made offers for each guest.