The industry will benefit from a revival in international vacation and business travel
Los Angeles, CA (PRWEB) September 17, 2012
The Global Hotels and Resorts industry is sensitive to a wide range of economic, social, demographic and geopolitical factors that affect domestic overnight travel within any country, as well as global international travel demand and patterns. With the onset of the global recession, all forms of travel accommodation experienced decreases in revenue as both consumers and businesses became more concerned about their finances and cut back on luxuries, which included travel. In 2009, as the global recession deepened and unemployment rose, a decline in the domestic travel rate and a 3.8% fall in international tourism arrivals (according to the United Nations World Tourism Organization) cut into demand for industry services. Since destination hotels and resorts rely heavily on domestic and foreign tourists, the decline in these travel rates hurt the global industry's bottom line during the recession, says IBISWorld industry analyst Nima Samadi. Nevertheless, in 2010 and 2011, international tourism arrivals rebounded 6.6% and 4.6% respectively. In 2012, domestic travel and international arrivals are anticipated to continue rising, with international arrivals forecast to grow 3.8% for the year. The infusion of tourist dollars is expected to benefit hotels and resorts and increase room rates, causing revenue to grow 1.6% in 2012. Over the five years to 2012, industry revenue is expected to increase at an average annual rate of 0.8% to $579.9 billion.
Travel spending is projected to increase over the next five years as the world economy continues to improve and tourist dollars will continue bolstering revenue for global hotels and resorts, says Samadi. International tourist arrivals in emerging economy destinations of Asia, Latin America, Central and Eastern Europe, Eastern Mediterranean Europe, the Middle East and Africa will grow at double the pace of destinations in developed economies. The biggest growth will be seen in Asia and the Oceania, where arrivals are forecast to increase. This will result in emerging economies surpassing advanced economies by 2015. In order to keep up with the aggressive rise in travel rates in these emerging regions, more hotels and resorts will be built, which should increase the proportion of industry revenue generated from these regions and drive revenue growth for the Global Hotels and Resorts industry over the five years to 2017.
It is estimated that in 2012, the industry's top players include Marriott International Inc. and Hilton Worldwide, providing this industry with a low level of concentration. Although industry concentration is low, it is increasing slightly due to continuing hotel buyouts and mergers, and operators joining franchise and chain operators. Major companies in the hotel segment are increasingly seeking to operate on a global basis and have a presence in major regions and countries and in the major towns and cities in these areas. The merging of smaller operators with the major hotel companies on an international basis is expected to continue in the next five years. Industry concentration is continuing to increase among the major global operators, although this is more now on a franchised or managed property basis. For more information, visit IBISWorld’s Global Hotels & Resorts industry report page.
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IBISWorld industry Report Key Topics
Firms in this industry include hotel and resort accommodations, with private or shared facilities, and with or without meal services and restaurants attached. This includes both chain and franchised operators; however, it excludes all other forms of accommodation, such as motels; caravan parks and camping grounds; youth and backpacker hotels; and bed and breakfast establishments.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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